Assignment #1 – Urban Outfitters Continuing Case Study Part 2: Creating a Business

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1.Identify at least three challenges when setting up a business. Explain why they are challenges. Setting up a new business can be a complicated task and entrepreneurs often face many challenges. One challenge is finding the funding necessary to get started. Many times there aren’t enough personal resources, like savings, or credit cards, and it may be necessary to seek help from family or friends. If they can’t help, a bank may be able to; however, getting a loan may be tough. Often, you cannot get a loan for 100% and you will be forced to find other ways to acquire funds for remaining start-up costs. (Introduction to Business, 2010) A second challenge is developing a great and unique idea that fills a certain need in the market. The idea needs to entice the buyer to want to buy it or a service that the public finds is a necessity. Even if you have found a great idea, there is no guarantee that the business will succeed and the product or service will sell. Another challenge to starting a business is the thorough market research which will have to be done to determine how the business might succeed. Decisions such as whether the business will be established via a store front or online and how best to market your business will be crucial, as will establishing what potential competitors exist and identifying what sets your product or service apart from businesses already existing. 2.Define what a “niche” product is. Give at least three examples of niche products. A niche product is a small part of a much larger market and is made and marketed for use in a small and specialized but profitable market (“Market niche”, n.d., para.1). It is something that people want to buy and is a solution to a certain problem. Some examples of niche products are Proactive, a skin product for acne, electric cars, and Tupperware, a household container that keeps food

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