These are the following topics:
When you own a small business that runs so well, you want to expand it by running another store (or stores), whether in the same area or even in another country. To do such thing, you need to know several important things like how is the local potential market, how much is the cost and risk to build a new store in certain area, or how is the competition among similar business in the area? But, if we calculate the cost to gather that kind of information, you might not be able to have any more money to run your business.
If you are facing the similar problem as we said before, you probably want to consider franchise system as your expansion strategy. By definition, franchise is a “type of license that a party (as we call them ‘franchisee’) acquires to allow them to have access to a business's (as we call them the ‘franchisor’) proprietary knowledge, processes and trademarks in order to allow the Franchisee to sell a product or provide a service under the franchisor business's name. In exchange for gaining the franchise, the franchisee usually pays the franchisor initial start-up and annual licensing fees” (Investopedia, 2017).
One of the articles that you can access in theentrepreneur.com says that franchise forecast continues strong for 2013 and getting stronger afterward. And it’s not only happens in the US, but also in the world.
But before you make up your mind to put your business into franchise open market, you need to know some of the advantage and disadvantage to choose such an expansion strategy. In the other article you can find in thentrepreneur.com, written by Scott Shane, a Professor at Case Western Reserve University, says that there are some important advantages and disadvantages franchising your business. The advantage of franchising your business is that you can have access to better talent, you can easily expand your capital, and you can also minimize your growth risk. But on the other hand, you might have the disadvantages such as you will have less control over your managers. But that’s not it. You also might have weaker core community as much as you can’t be as innovative as you are before since you need to gain approval from your franchisee if you want to apply some new ideas, even when you are the franchisor. To read the full article, you can access https://www.entrepreneur.com/article/226489
If you are an entrepreneur economist consultant, what will you suggest your client? Send us your thought and analysis about this issue!!
Nowadays, if you go to a mall or even a small plaza or department store, you will most of the time find a pop up bazaar. This bazaar will have different theme overtime and change the tenants and items they sell. As the mall visitor, sometimes they come to the mall not merely to visit the mall, but the want to visit the pop up bazaar being held that time.
Usually, the length of a pop up bazaar period is no more than a month. Even some of the pop up bazaar only last for 2-3 days for one event. The thing about pop up bazaar is, most of the time, the tenants are come from micro, small, and medium enterprise category. And for the items category, pop up bazaar most of the time are filled by creative industry product from innovative food and snack product, contemporary fashion product (clothes, shoes, bags, etc), to wood craft or creative contemporary interior product.
For the last few years, the growth of creative industry in Indonesia is about 10,8% each year. In fact, for the 2015 to 2016 only, the growth of this industry reached 17% of growth. As the industry growth, the market and the household spending for this industry product is raising from IDR 642.327 to IDR 866.542 in billion IDR.
This kind of phenomenon not only happens in Indonesia. In Singapore, back on February 2017, a prestigious hotel called New Majestic Hotel had turned its hotel into a bazaar palace for the weekend. This bazaar was featuring 21 brands selling homeware, clothes, jewellery and food that provided by the local business.
Regardless of all the positive things caused by pop up bazaar activity, this business model couldn’t give any proof about how pop up bazaar could create an establish business environment for the local producers since there is no permanent place to sell things and permanent market in an area. So for the long term, we could not rely on this kind of business to boost a country’s economic condition, especially Indonesia.
As an entrepreneurial economist, how do you see this phenomenon? Send us your thought and analysis about this issue!!
We have come to the time when all the things are digital, including in promoting your business. To put it into a smaller discussion topic, social media itself can be used as the only channel to promote your business. In Indonesia, if you troll through Instagram, you will find countless online shops. Furthermore, even your favourite celebrities doing the endorsement of a product.
Social media allows smaller companies to compete against some of the larger businesses to reach more customers. One of the biggest advantages of social media marketing is its less reliant on a large budget. Being successful with social media for business comes down to creativity and engagement. Any business and product can be promoted through social media. Thus, the lower “barrier to entry” makes it possible for any business to compete.
In the US, there are some evidence showing that social media is the best way to promote your business. Here is some of them:
Social media for business is a necessity just like paid ads, flyers and other traditional marketing efforts. In order to compete, businesses can’t afford to be inactive on social media.
Despite all of these stats, some businesses still aren’t sold on social media as a marketing tool. In fact, one in three small businesses doesn’t think social media is important for their business. One of the primary reasons for this is because organizations don’t realize all of the benefits it has to offer yet. And this is partially understandable due to the nature of social media. It’s used as a way to build brand awareness, fuel content marketing and other important aspects that aren’t as measurable as what small businesses on social media are used to.
We cannot argue with the negative comment as well when we couldn’t control our follower. Not all your follower or your audience in your social media account is your potential market. For example in Indonesia case, you have Bandung as your production based area, while your followers are come from every other area of Indonesia where the shipping cost will cost you double or triple your product price. As the “barrier to entry” is so low, it can take the other side where the follower might be just be there to steal your idea and apply it in their local area.
As an entrepreneurial economist, how do you see this phenomenon? Send us your thought and analysis about this issue!! J
*(Most of the words in the article are taken from https://sproutsocial.com/insights/social-media-for-business/)