Unit 2: The Innovative Entrepreneur/Business Planning and Pitching
In this assignment, I will explain my business vision and proposal for a micro-business which will be operated as a subsidiary of my main marketing business. I shall also devise a business model and route to market, this will then be assessed by myself after I consult with other business owners (my target market) and using limited data from market research that I am currently conducting for use in Unit 10, Assignment 2 alongside the positive responses I received from the LBC in Leicester’s cultural quarter and at business networking events we have attended; this will also allow me to assess the feasibility of my business ideas and also show me which parts of my business I should focus on first. I will also identify any strengths or weaknesses and barriers I may need to overcome when it comes to starting my business.
I want to give the poorest, most unfortunate individuals the opportunity to make money.
My vision is to make a real difference within British society and beyond by alleviating poverty and reducing the stigma of those who suffer from homelessness and drug abuse and everything that comes with it including criminal behaviour. It is my stern belief that nobody wakes up and thinks “Today, I’m going to become homeless!” or “Today, I’m going to ruin the rest of my life by becoming addicted to drugs.” or “Today, I’m going to go and burgle a property!”
No, instead people become homeless as a result of circumstances beyond their control and poor personal choices; I have met millionaires who have lost everything to people like myself who were kicked out of home at a very young age, before they were even adults, due to a deterioration of relationships at home.
People typically become drug addicts, as a result of peer pressure and again, poor choices. This, coupled with the desperation homeless people find themselves coping with, leads to crime.
A common idea many people have is “criminals should be punished and it should haunt them forever.” And seemingly, rightfully so… at what point do we draw the line? Should your life be ruined just because you went 1mph beyond the speed limit?
I believe it is this stigma which results in such a high rate of reoffending. It is important I explain all of this to really understand the justification behind my reasons to help people in my business. It was unfortunate when a, for lack of a better word, subject of mine was arrested for a crime he committed before he made the decision to stop committing crime on the basis that if he does stop committing crime and stops consuming illegal substances, I will give him a place to stay and he will take part in my social enterprise and possibly even manage that side of my business. However, since going to prison on remand, he has begun his recovery from the heroin addiction which he was already on the road towards before he was arrested. He refused to be released from custody at his remand hearing to enable himself to disassociate from his fellow drug addicts and it would seem that the opportunity I have presented him has giving him the one thing he needs to decide he wants his life back. The subject was brought into that world after he was the victim of his own father who tortured him and left him for dead in a cement sack, it was well publicised by the local and national news outlets, I appreciate why he was led to his heroin addiction by peers he met when he was rehoused in a hostel for homeless people. Had his father not done what he did to him, perhaps he’d have never eventually have become a criminal? My vision is to bring his, and people like him who have unfortunately ended up on the wrong path’s, potential to the surface and show them there is something better than offending, this will benefit them and the communities they live in by reducing crime. The subject was arrested whilst he was begging, the only way for homeless drug addicts to earn an income and it is illegal, asking for kindness is considered anti-social or all things.
I want to give homeless people and ex-criminals and drug addicts a hand up, not a hand out and I will do this by liaising with relevant support services and identifying areas of support and need for those who are working for me on a self-employed basis, like Big Issue sellers.
The Big Issue do a very similar thing to what I want to do, so how exactly am I any different? Well, for The Big Issue sellers, they get the first few for free and they sell those for £2.50 each and then repurchase more for £1.25 each, this gives them responsibility and it allows them to run their own businesses and work as little or as much as they like, the income The Big Issue earns from this simply covers printing costs and distribution overheads such as fuel. From my experience, some people, like myself, have too much pride to declare ourselves homeless to the general public which is what donning on The Big Issue seller’s bib would mean; everybody knows that the majority of the sellers are either street homeless or living in temporary accommodation such as The Dawn Centre or Leicester City Council Supported Accommodation such as Unity House on Lincoln Street in Leicester or now-closed Upper Tichbourne Street Hostel. I have also identified four qualities a Big Issue must possess at least one or more of to have any sort of success and these are, in order of what I believe to be most important:
What I will do is give my self-employed workers a non-customer facing role where it won’t necessarily be important for them to ensure they get to use the only public shower in Leicester provided by YASC (a service operated by the YMCA and located in the Dawn Centre on Conduit Street, another homelessness hostel) each day before they go out to pitch, where they don’t have to have confidence because they’re not talking to the end-user unless where appropriate and most importantly, they’ll get paid an equivalent amount if not more to the average income a Big Issue seller makes on a day to day basis (I hope to get an insight into how much this will actually be by completion of Unit 10: Assignment 2).
What exactly is my business idea though? Well, it is all about marketing and distribution of marketing materials. This will include advertising, PR, face to face marketing (including direct selling) and door to door marketing material distribution (such as leaflets, catalogues or brochures) and travelling billboards with the hopes to also incorporate digital media marketing at a later date.
The business itself is not designed to be a social enterprise however, we will have a social enterprise “arm” if you like, for lack of a better term, where those who fit the previously mentioned criteria will manage and operate the leaflet distribution and some of the travelling billboard services with opportunities to progress into paid employment or to continue working on a self-employed basis into leadership roles and eventually into their own office which would be how we expand; this will generate revenue for us as we would retain control of the business, once they get to this position, it would be difficult to consider them self-employed as they’ll be responsible for running the office day to day and managing their own staff. At this early stage, however, we should focus on starting up and increasing brand awareness and reputation..
Why is it important I do this now? Because every day it saddens me to see homeless services having their budgets cut, good people ending up in bad places because homeless services such as hostels are being shut down. Even YASC has had to reduce their hours of operation and make redundant paid outreach staff, Leicester City Council have closed numerous hostels around Leicester from Hastings Street to Upper Tichbourne Street to St James Terrace. Hits Homes had to refuse to renew their lease for the Maidstone Road building which housed homeless people though thankfully it has remained a homelessness hostel for mothers by East Midlands Housing. Not nearly enough is being done to empower individuals to take control of their own lives without having an adverse effect on innocent people around them. I have met several homeless people who are willing to work and face the same setbacks as I did; without an address, nearly all employers will not hire you even on a self-employed basis except for social-enterprises like The Big Issue.
I believe there is a better alternative to prison for most offenders and working with probation, homelessness and drug and alcohol services as well as the criminal justice system we can reduce the risk of people offending before their first offence and give repeat offenders a different opportunity. There are a lot of offenders who are given the condition of unpaid work, where they carry out mostly unimportant work without a hope for a job at the end of it; they complete their hours and now what do they do with their time? Criminal record preventing them from getting a job… Nobody to take them seriously when they say “I’ve done wrong but I’ve made amends and want to do better.” They will resort back to crime.
I know myself that no employer will hire you without an address and if you put “Homeless” in the address field, it is game over. You won’t even get an email to tell you that you were unsuccessful but for the most part, emails are difficult to access if you are homeless due to budget cuts to the local libraries limiting computer usage… I feel it is somewhat of a duty to give others the chances homeless people are very unlikely to be offered as a result of circumstances which were caused by things which weren’t entirely all their own fault.
My vision will only work if I am fully transparent with my customers. I will have to eliminate the risk of marketing materials being “dumped” by ensuring full GPS tracking though if customers opt for a cheaper package, this will not be included. I will also have a duty to protect my workers from the negative impact of the typical stereotypes of homeless people.
I will have to ensure my workers are upfront and honest with me about their criminal careers which may mean they agree to be subject to the possibility of DBS and background checks. Because of the level of support these less-fortunate individuals will receive from our business, it will also be imperative they agree to authorise us to discuss their personal data with relevant support services we work with.
I hope that, should I achieve my vision, my business will be able to help end the cycle of homelessness>drugs>crime>stable accommodation>repeat once and for all. I wouldn’t be able to do it myself but with the likes of Virgin Trains, who are recruiting directly from prisons, The Big Issue, SocialBite and others, we will be able to reduce the amount of people who have found themselves stuck within that cycle. The future of the social enterprise could lead in several directions from housing to shelters for male domestic abuse victims for which, to the best of my knowledge, there is little above none in the UK. However, before we come to those decisions, it is first crucial to establish the business’ foundations. It is important to also note that the social enterprise arm will be operated as a subsidiary of the main marketing business, a micro-business within a company.
Corporate Structure:
Managing Director/CEO – – – – Partner Managing Director/CEO (dependent on future progression opportunities)
Upper Management
General Staff
Partner CEO Trainee – Self Employed (dependent on future progression opportunities)
Area Managers – Self Employed
Team Leaders – Self Employed
Operatives – Self Employed
(Staff will be hired as and when appropriate, we shall not need every level of the corporate structure right from the offset of starting the business)
Progression opportunities will be for those who really excel in their recovery/rehabilitation and overall work ethic, performance and achievement. It will allow us to expand nationally and also provide a better standard of life to those who really deserve it. They will have to be willing to relocate and they will eventually become the managing director of their own branch with adequate support from us. This is popular in many direct sales companies and has been, in my opinion, proven to motivate staff.
Services/Products (subject to change depending on outcome of market research):
All outsourced services have already been sought within Leicester with the exception of lead generation which will only be outsourced online for less targeted lead generation. When we expand, we will need to seek new suppliers local to the areas we work in.
Business Model:
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Intended Customers |
Sources of initial finance |
Sources of Revenue |
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Small businesses |
Personal savings |
Sales Revenue |
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Medium businesses |
Social Enterprise Grants |
Commission from direct sales + service fees |
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Charities |
Investment (ONLY from those who have a high asset value and will be contributory to the business beyond financial aid) |
Profit share from partner CEOs |
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General public (eg. One-off charity events) |
Start Up Loans Co. |
Donations (used to assist in operational costs of the social enterprise and where possible, used to further support those who operate within the social enterprise arm) – We must make it clear from the outset we are NOT a charity but a for profit business, we will explain what the donations are going to and make it abundantly clear that their donations will not be kept as profit. |
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Large Businesses |
Further lines of personal credit |
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Educational providers |
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Religious organisations |
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Political organisations |
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Routes to Market:
I will enter the market as I did when I first started my venture, by simply walking into stores and building rapport with business owners whilst identifying their marketing needs; this will enable me to make recommendations which will adequately suit their needs. I shall then explain the fantastic things we are doing within the community and discuss how we eliminate the risks which are a real possibility when employing vulnerable people such as homeless individuals, ex-criminals who are in the process of reform and recovering drug addicts. I will handle their objections and close the sale which will end the 5 steps of B2B sales which I have adapted from the 5 steps of door to door sales;
5 Steps of B2B sales:
I will also utilise social media over time to build an online presence which, alongside nationwide expansion, will get our name heard. I have also found that word-of-mouth referrals are a great way to find new customers; I have never been to some of the cities some of my customers are from who I’ve never met – these all came as a result of other customers I had prior to them recommending me. We will also have our own business information on any of our customer’s marketing materials or on our travelling billboards where permitted by our customers.
Barriers:
In regards to barriers, the only way my business will work is if I am honest with my customers. These people who are operating within the social enterprise will only be responsible for distributing leaflets or riding travelling billboards. All other services will be carried out by myself and other staff who may or may not be self-employed (refer back to Corporate Structure).
Strengths/Weaknesses
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Strengths |
Weaknesses |
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We will be doing a really good thing for our communities. This will include lowering the amount of people who beg during the daytime and night time hours (as travelling billboards can be effective at night time, especially for night clubs and businesses who open late such as restaurant bars) Because of our co-operation with drug and alcohol services and outreach workers, we will be able to reduce the number of addicts, hopefully, slowly but surely. If anything else, we will be able to identify those who really want help but can’t find it and give them the help they need whilst sign posting those with lower needs. By working with homeless services, it will be my intention to ensure that anybody who works for me never spends another night under the stars unwillingly. This will improve the health of those who are victim to what could arguably be the worst social issues in England, homelessness and poverty. The opportunities to diversify are limitless; the long term goal would be to open up medium-term housing complexes where tenants will stay for up to 5 years until they’re able to afford private rent, this will lower the demand for social housing meaning less people will end up in hostels or on the streets due to a lack of supply, it will also save the local authorities money by preventing them from being forced to house vulnerable families in high-cost hotels. |
The most obvious weakness is the fact that criminals and drug addicts and homeless people are often frowned upon by businesses and consumers alike. The good news is, however, the end user (our customer’s customer) needn’t know this person is homeless, an ex-criminal or drug addict. We have also previously detailed how we would overcome this by being transparent. The second weakness is finance, at the moment we have very little personal savings so without investment, it may take a while before we are able to take on staff and really help those in need. This will also massively slow down growth. Another weakness or barrier, if you like, is licencing. During certain times of the year, licences are required (such as to operate on Belgrave Road, Leicester during Diwali would require a licence from the local authority) – we would mitigate this by liaising regularly with the local authorities about any upcoming marketing campaigns (by either recorded phone call or email) to ensure we are fully compliant with any licencing regulations. |
Expected initial start-up costs and overheads:
In relation to the above expenses, many of them are subject to change over time given that we are at such an early stage in the business planning process and they will be refined over time. However, as it stands currently, costs total is less than £10’000 (excluding licences and website maintenance).
ROI will be defined upon evaluation of the data collected from the market research conducted for Unit 10: Assignment 2. However, I predict each customer to be spending at least £24 to in excess of £1000 at a time for our services.
From the market research I have completed so far whilst undertaking this assignment, it is clear to me that it is perfectly viable provided we mitigate the risks associated with those who operate under the social enterprise arm. As for the other marketing services, the Cultural Quarter of Leicester shown a huge amount of interest in our travelling billboards which I am in the process of having designed and hopefully built in exchange for a period of free advertising; I can see it now, advertising space on a billboard, carbon emission free, pulled by a bicycle.
I also believe it will be successful, looking at the success of John Bird, there is no reason why it will not be just because of the calibre of the individuals who operate a small portion of my overall business.
My idea is innovative, it brings something new to the table where it is helping to relieve the social issues of homelessness, drug addiction and crime at its root by giving the people who operate within my business a hand up instead of a hand out, a reason not to commit crime and an opportunity to make money without having to sacrifice their own dignity whilst hopefully giving them their self-respect back to enable them to recover from their drug addiction; if drugs are the only thing that makes a person cope with their own lack of self-worth, they’ll continue to use; I am giving them an opportunity to see there are better things to do with your time than taking drugs which could end up killing them.
Further evidence of viability is the appraisals I have so far received from potential customers, especially those who provide support services for people I hope to also help. With the ever increasing amount of social enterprises and charities in the United Kingdom, if other non-social enterprises did not want to use my services, I believe there will still be enough work for those I want to help whilst I focus on setting up a subsidiary which will be operated by people who will be more attractive to the customers so we can still capitalise on the market.
Furthermore, Jordan Singh who operates many business networking events attended Leicester College as a business surgery advisor has given me some wonderful tips on how to mitigate the risks associated with leaflet distribution which have been further confirmed by Leicester Leaflet Distributors (LLD), by implementing tracking and being open, there will be no reason for my customers to not trust me should they find out seemingly less-desirable individuals operate in our business.
Other sources of advice and knowledge I will draw upon during the start-up phase and where else is necessary will be the internet and also from any mentors I work with along the way and especially if I secure a loan through Start Up Loans Co., failing this, I may invest in independent financial advice where appropriate.
The most likely source of funding I will use will be provided by the Start Up Loans Co. who partners with several providers who offer mentoring, in Leicester, there are several partners who specialise in Social Enterprises and I would expect to be working with them. Other funding will come from grants and where appropriate, investment.
In conclusion, like Sir John Bird and Josh Littlejohn (SocialBite CEO), who have proven success in profitable business from helping those who suffer from the direst of social issues, my business idea is similarly going to be a success. on top of this, as the news story published on the 11/11/2016 by the BBC reveals, even Virgin Trains are hiring directly from prisons to help resolve “the revolving door syndrome” of repeat offenders (see reference below) and they have doubled the amount of ex-offenders under their employ, if the likes of Virgin Group (owned by Richard Branson) can successfully hire criminals, why can’t everybody else? I will end with this; Kevin Mitnick was the most wanted man by the American FBI before he started his own successful security firm. A book and film called “Catch Me If You Can” is based on the true story of Frank Abagnale who was a prolific fraudster who started his own successful fraud consulting company and even Steven Fry, presenter of QI and extremely successful television personality has spent time in prison for credit card fraud. There are countless men and women who were criminals who turned their lives around, most of them only did so because of the help and support they received outside of the criminal world. You just have to look at Daniella Westbrook, Amy Winehouse and countless other successful people within their own industries who became victims to drug addiction and I know myself just how easy it is to become homeless for several years for very little reason. We are all just people and most of us only make the choices we have in the past out of desperation and a need to be helped. What my business does is it enables people to help themselves whilst still providing reliable marketing services and diverse marketing packages to businesses (see above Business Model).
Sources/Reference:
https://youtu.be/nXVn8XuNEFk?t=2m28s – About Lord John Bird
https://www.youtube.com/watch?v=adWIwko0slo – Possible partnership opportunity to assist with JB’s The Big Issue distribution plans.
http://www.marketingdonut.co.uk/ – General reference
http://www.smarta.com/advice/sales-and-marketing/sales/routes-to-market/ – General reference
http://www.bbc.co.uk/news/uk-scotland-37942255 – Virgin Trains Hire Criminals
Business Surgery Meetings @ Leicester College; Refer to Reflective Logs