1. Entrepreneurship
Week 10
Operations

2. Business Operations
Value Chain – suppliers to company to distributors to customers – Toy example

3. Business Operations
Value Chain – suppliers to company to distributors to customers – Book publishing example

4. Business Operations Value Chain – Dress shop example –
Who are the suppliers?
How do dresses get to your shop?
How do dresses get to your customers?

5. Business Operations Value Chain – Perfume shop example –
Who are the suppliers?
How do Perfumes get to your shop?
How do Perfumes get to your customers?

6. Business Operations Value Chain – Restaurant example –
Who are the suppliers?
How does food get to your restaurant?
How does food get to your customers?

7. Business Operations Value Chain – Your business –
Who are your suppliers?
How will supplies get to your business?
How does your product get to your customers?

8. Setting up your Business
What will it take to prepare your business? Usually you need to fix up a facility, buy equipment, and hire employees. What will all that cost?

9. Set up – ice cream shop example
I first need to rent a store near the Nizwa Mall. It will need to have some parking spaces out front, and a good air conditioning system to keep the store cool. It will also have to have a wash basin where I can clean my ice cream scoops. I will want to paint and decorate it before I open. I will need to purchase two display refrigerators with glass fronts so I can keep the ice cream cool, but still have it visible for customers to see. I will need another freezer in the back of the store to keep extra ice cream. To collect money, I will need a cash register and a counter. I will operate the store during the first year, so I do not need to hire any employees.

10. Initial Costs – ice cream shop example
Costs – Stores with the size and location I need rent for about 200 OMR per month. I estimate decorating costs at 50 OMR I have found used ice cream refrigerators for 130 OMR each, and a large freeze will cost me another 300 OMR. The cash register and counter will cost 90 OMR. Total set up costs – 50 OMR for paint and decorations 430 OMR for the storage freezer 90 OMR for the cash register

11. Group Competition
Assume you are opening a flower shop in the Nizwa Mall. Your competitive strategy is to offer more kinds of flowers than other flower shops, and you will provide free delivery.
Make a list of all the expenses you will have to start up your business.
Find creative ways to reduce each of those expenses.
The group with the most complete list of expenses – and – the best solutions to the expenses wins.

12. Operations
How will you make your product? Where will you get materials? How much will those materials cost? How long will it take to make each product?

13. Suppliers Ice cream shop example
I do not plan to make my own ice cream. I will purchase it from Muscat Creamery. I have contacted them and learned I can buy their ice cream in 5 liter containers for 20 OMR. I have found that 5 liters of ice cream yields 50 scoops, or .4 OMR per scoop. I have another source – Nizwa Supply – for plastic cups, spoons, and napkins. Total cost per sale will be .1 OMR. Total cost of each sale: .4 OMR ice cream .1 OMR cups, spoon, napkins .5 OMR total

14. Growth Plan
What plans do you have for the future? What might you do in the next 1-3 years if your business is successful?

15. Growth Plan Ice cream shop example
I plan to start with 8 flavors of ice cream. If the store is successful, I will add additional flavors and some candy items.

16. Set up – Photobook example
I have a good camera, but for professional quality photos, I will need to buy a very good Nikon. I will also need to drive to many important locations about Oman to take pictures. I expect that will take me 6 months. I will also have to write up the history of these places. I already have some books on the history of Oman, but I will need to go to the library for more, and I will want to talk to local people who might have additional stories to tell. I have a car that can travel throughout Oman, but I will need money for gas and meals.

17. Initial Costs – Photobook example
Costs OMR for the Nikon camera 20 OMR for gas and food for 6 months

18. Suppliers – Photobook example
I have spoken with sales people at Muscat Instaprint. They tell me I need to layout 180 pages for the book. For each page I will have to identify the photo to use, and give them the photo description in a Microsoft Word document file. They will charge me a 50 OMR “set up” fee and 6 OMR for each book I order. I plan to order 200 books to start. Once I have the books, I will act as my own salesman, and I will visit tourist hotels and tour company operators to see if they will show my books to their customers.

19. Growth Plan – Photobook example
There are several ways I could expand my business. One way would be to hire a salesperson who can reach more tour operators in the south of Oman. Another way would be to produce more tour books with each either focusing on a location (Nizwa, Muscat, Salalah), or a theme (castles, seashore, mountains).