PROJECT SELECTION
IT ALL BEGINS WITH AN
IDEA The overriding reason for anyone to think of
establishing a MSME can be summarised in one word -
opportunity. If one sees an opportunity to provide a
product or service in a manner to generate sufficient
surplus, then one is on the way to start up a MSME.
This is all the more true if one is a believer in the
maxim, "Small is Beautiful". So how does one find the
dream opportunity? Opportunities emerge out of ideas
that one comes across by thinking about lives of ones
friends and neighbours. This can generate ideas about
products and services that can make things easier, and
improve quality of life for people. The ideas thus
generated need to be filtered through an 8 layer sieve
to come out with the opportunity that can frutify in
your dream of your own MSME. This model is shown in
the following flow:
- Does the idea fire
up your motivation ?
- Is it a viable
business proposition in your area ?
- Does it match the
needs of your clientele ?
- Check it out with
basic market research
- Test it out at
market place
- Consult with the
experts
- Look out for
competition in the field
- Is it a sunrise
industry ?
- Your business
opportunity
- Project
conceptualisation
Once the ideas are
screened and a viable business opportunity emerges the
project has to be conceptualised in all its dimensions.
The 4 Ps of Project Conception are:
- PRODUCT (Shape, Size
and Nature)
- PROCESS (Technology
to produce the product)
- PLACE (Location of
Plant)
- PARTNER
(Technological of Financial Collaborator)
MAKING A PRODUCT CHOICE
In
a project conceptualisation stage while making a product
choice following factors are related to product need to
be considered:
- PRODUCT LINE -
DEPTH, WIDTH
- PACKAGING
- BRANDING
- WARRANTIES
- AFTER SALES SERVICE
Some other factors
that one should consider while finalising the product
choice are:
- Easy availability of
raw-material
- Processy Technology
- Easy accessibility
in the market
- Incentive and
support from Government
Market information is also important for product selection. Products,
which are likely to have a number of players in the market are best
avoided. Some such products in the recent past have been, plastic
footwear, audio cassettes, disposable gloves and bulk drugs. In case the
entrepreneur is looking for a product which has export potential, the
following additional questions need to be asked:
- What should be the
contents of export-product portfolio ?
- What are the special
requirements for packaging if one has to export the
products?
- What product
adaptations are needed to be made for exporting a
product to a specific country ? The development of
export- product portfolio can be done by considering 4
parameters viz.
- External demand
conditions
- Internal supply
capability
- Complexity of
Marketing Tasks
- Amount of investment
required to penetrate the market
Analysis can be conducted using this four dimensional model. The obvious
choice is a product which scores a high rating on first two parameters and
low rating on last two parameters.
EXIM
(Export Import Bank of India) Bank has also developed an
excellent model to conduct the export-product portfolio
analysis based on three parameters viz.
- SUPPLY CAPABILITY IN
PRODUCT GROUP
- DOMESTIC ENVIRONMENT
- EXPORT MARKET
ATTRACTIVENESS
This analysis gives
rise to product groups with high potential or low
potential. Some high potential areas are:
- LEATHER GARMENTS
- YARNS AND THREADS
- APPAREL - WOVEN AND
KNITTED
- B & W TV SETS
- COSTUME JEWELLERY
With
regard to special packaging requirements one has to be
careful about laws of the country one is exporting to.
For instance, while exporting to Australia,
wooden-packaging cannot be done.
Product adaptations for country's specific
needs look into things like whether voltage supply is
220V or 110V for electric appliances and for automobiles
whether left-hand drive or right-hand drive is
appropriate.
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