American Chemical Society Working for Yourself ACS Career

American Chemical Society Working for Yourself ACS Career Pathways Series

American Chemical Society Do I See My Boss in My Mirror? Individual to pairs self-assessment activity 2

Working for Yourself The Potential Upside American Chemical Society The Potential Downside

Working for Yourself: Objectives • To provide you with additional clarity about whether the self-employment option is appropriate for you • To develop a very preliminary business plan for your potential new business American Chemical Society

Working for Yourself: Agenda • Section 1: Describing the Business • Section 2: Describing the Market • Section 3: Describing the Organization • Section 4: Developing the Marketing and Sales Strategy • Section 5: Describing the Financing American Chemical Society

American Chemical Society Meet Four Entrepreneurs Small group activity

American Chemical Society What Could I Do? Individual application activity

Working for Yourself: Agenda • Section 1: Describing the Business • Section 2: Describing the Market • Section 3: Describing the Organization • Section 4: Developing the Marketing and Sales Strategy • Section 5: Describing the Financing American Chemical Society

How to Describe the Business • Brief summary of the purpose of the business (mission statement) • The growth objectives or volume projections for the first year to three years • The products or services that the business would provide American Chemical Society

The Three Key Questions for a Mission Statement • What are the opportunities or needs that the business will address? (The purpose of the organization) • What will we do to address those needs? (The business of the organization) • What principles or beliefs guide our work? (The values of the organization) American Chemical Society

Growth Objectives What kinds of guidelines or tips can we give here? American Chemical Society

Description of the Products or Services • Think beyond Expected to Augmented and Potential • This expansion usually involves focusing less on physical product and more on the “service surround. ” • Try to categorize your offering into three or four main types or packages. • When describing the offering of a new business, remember that typically “less is more. ” Generic Expected Augmented Potential Ted Levitt’s Concept of “The Offering” American Chemical Society

American Chemical Society Coaching an Entrepreneur (Part 1) Small group activity

American Chemical Society Writing My Own Business Plan (Part 1) Individual application activity

Working for Yourself: Agenda • Section 1: Describing the Business • Section 2: Describing the Market • Section 3: Describing the Organization • Section 4: Developing the Marketing and Sales Strategy • Section 5: Describing the Financing American Chemical Society

How to Describe the Market • Describe the general profile of the ideal customer organization • Survey the competition • Answer the question, “What will we count on to win? ” American Chemical Society

Profile the Ideal Customer • Industry (or industry segment) served • Location • Size of firm • Quality, technology, price preferences • Other (issues specific to your offering and industry) American Chemical Society

Survey the Competition From Michael Porter’s Competitive Advantage American Chemical Society

What Do We Count on to Win? • Customer intimacy – Focus on delivering a customized response to each customer – Example: Nordstrom’s • Operational excellence – Focus on quality, price and ease of purchase and use – Example: Federal Express • Product superiority – Focus on creating the best, leading-edge products and services – Example: Intel or Apple The Disciplines of Market Leaders, Treacy and Wiersma American Chemical Society

American Chemical Society Coaching an Entrepreneur (Part 2) Small group activity

American Chemical Society Writing My Own Business Plan (Part 2) Individual application activity

Working for Yourself: Agenda • Section 1: Describing the Business • Section 2: Describing the Market • Section 3: Describing the Organization • Section 4: Developing the Marketing and Sales Strategy • Section 5: Describing the Financing American Chemical Society

How to Describe the Organization • Brief biography of principal(s) • Description of the legal structure of the organization • Plans for managing day-to-day activities of the business American Chemical Society

Legal Structures Personal Liability No Personal Liability • Independent contractor • S-Corporation • Sole proprietor • C-Corporation • General partnership • Limited Liability Corporation (LLC) American Chemical Society

Independent Contractor or Sole Proprietorship American Chemical Society

General Partnership American Chemical Society

S-Corporation vs C-Corporation S-Corporation American Chemical Society C-Corporation

Managing Day-to-Day Activities • Website design and maintenance • Proposals, contracts, and purchase orders • Bookkeeping, taxes, tax records, tax reporting • Payroll (self or service? ) • Billing, A/P and A/R American Chemical Society

Members of Your “Extended Enterprise” • Depending on the nature of the business, you may well want to have access to independent contractors who are separate from your organization • Anticipate your requirements: – Editor? – Who else? • Discuss compensation models (By the hour? By the project? ) • Be sure to build these costs into your costing model. American Chemical Society

American Chemical Society Coaching an Entrepreneur (Part 3) Small group activity

American Chemical Society Writing My Own Business Plan (Part 3) Individual application activity

Working for Yourself: Agenda • Section 1: Describing the Business • Section 2: Describing the Market • Section 3: Describing the Organization • Section 4: Developing the Marketing and Sales Strategy • Section 5: Describing the Financing American Chemical Society

How to Develop a Marketing and Sales Strategy • Marketing strategy: the Four P’s – Pricing – Product diversification – Promotion – Placement (channel options) • Sales strategy – Who will do the selling? – Who is the typical contact in the customer organization? – How will we identify and develop leads? American Chemical Society

Pricing Models For Product-Based Offerings For Service-Based Offerings • Cost plus • Competitive positioning • Per hour • Value pricing • Per project • Tiered or volume pricing • Exotics (razor blade model, “freemium” model, Ryanair model) American Chemical Society

Product Diversification • Do you offer one product/service package or several? • To what extent do your product/services make up “bundles” (the whole being greater than the sum of the parts)? • How much diversification do you want? – Too little, you might lose out on opportunities – Too much, and you may lost focus American Chemical Society

Promotion • Marketing collateral (brochures, folders, business cards, etc. ) • Web presence (website, search engine optimization) • Advertising • Social media American Chemical Society

Placement (Channel Options) Direct Channels Indirect Channels • You and your employees do the selling • • Fixed costs • More control, more attention, closer to customers American Chemical Society Agents and non-employees do the selling • Variable costs • Less control, less attention, more distance from customers

American Chemical Society Coaching an Entrepreneur (Part 4) Small group activity

American Chemical Society Writing My Own Business Plan (Part 4) Individual application activity

Working for Yourself: Agenda • Section 1: Describing the Business • Section 2: Describing the Market • Section 3: Describing the Organization • Section 4: Developing the Marketing and Sales Strategy • Section 5: Describing the Financing American Chemical Society

How to Describe the Financing • Estimate start-up costs • Develop firstyear income statement projection • Develop first-year cash flow projection American Chemical Society

Estimating Start-Up Costs One-time • Computer • Office furniture • Marketing materials Fixed Variable • Rent • Salaries • Phone/internet • Advertising • Insurance Ongoing American Chemical Society

Income Statement • Measures a company’s performance over a specific accounting period • Often called a “profit and loss statement” Revenue • • • Sales revenue Interest income Royalty payments Expenses • • • Advertising Bank and credit card fees Bookkeeping fees Subcontractors Entertainment Legal and professional services Printing, postage and stationery Rent Materials Telephone and utilities Revenue – Expenses = Net Income American Chemical Society

Cash Flow Statement American Chemical Society

American Chemical Society Coaching an Entrepreneur (Part 5) Small group activity

American Chemical Society Writing My Own Business Plan (Part 5) Individual application activity

Working for Yourself: Review • Section 1: Describing the Business • Section 2: Describing the Market • Section 3: Describing the Organization • Section 4: Developing the Marketing and Sales Strategy • Section 5: Describing the Financing American Chemical Society