BUSINESS MODE

Introduction

To the entrepreneur, the business model serves as the core of any successful startup, because no matter

the intelligent idea, business startup must have an element of viability in recognition of making money

that is worthy for future investment and sustain itself.

As such a unique business model to be chosen needs to work better than the competitor’s model, therefore

it is important to adopt a model that best suits the business portfolio of services. Likewise as an

entrepreneur, bearing in mind that one of the worst mistakes is trying to reinvent a business model that

has never been done before.

Answers to Question 1:

The model to be adopted for the business startup after school is called AGENGO Business Model. This is

referred to as serving as a "middleman" between the manufacturer of the products and the final consumer

who serve as the end user. Ideally, this model of business is to take shape as a form of retail and store

supermarket chain outlets. As it is suitable for the sales of high-end luxury products, consumables in

clothing and shoe accessories manufactured by world-renowned brands from other African countries with

the aim of to meet the needs of the average middle-class income earner in Ghana.

Furthermore, the business model will integrate both offline situations of stores and shops which can be

engaged with an online web presence to the business clients. In addition, an extra form of a catalog,

telephone and sales support is to be provided. In contrast to the nature of this model, the motivation of
being a middle man operator makes the business very popular, looking at the dominance in the Ghanaian

market place.

A common example is the physical facilities provision of the chain stores to project for potential customers

to either pick their order directly at a local branch store or get it to their home. The emphasis will be on

the establishment of an efficient and effective logistics and supply chain network with the manufacturer.

Answer to Question 2

A unique business level strategy formulation for the AGYENGO Model is the strategy of overall cost

leadership as the emphasis is to improve the value chain and create a low-cost position suitable for the

retailers who serve as middlemen to the end user of the business product or service. The organization is

to manage the retailer position from the manufacturer to the retailers and then final consumers.

Support Activities for Overall Cost Business Level Strategy

A. Firm Infrastructure

Basic Components: Management layers reduce overhead cost, standard accounting practices,

require personnel’s,

B. Human Resource Management:

Basic Components: Cost immunization, turnover of employees, strategic employee policies,

employee orientation, recruitment and training programmers, retailer performance appraisal.

C. Technology Development

Basic Component: Internet Adoption, Integrated technology service, cost of technology

development etc.
 D. Procurement:

Basic Component: Policy guidelines quality levels on the procurement of materials, purchasing

operatives of the business unit

Competitive advantage with the adoption of overall cost leadership business strategy

1. Overall cost leadership to the entrepreneur enables the start-up firm to achieve above average

retunes despite strong competition.

2. It protects the startup firm against rivalry from competitors because lower cost allows a firm to

maximize returns

3. At the low-cost position, it protects the enterprise against powerful buyers

4. An overall cost leadership provides more flexibility to cope with demands for powerful suppliers

for input cost.

5. The strategy position for the firm in a favorable position which requests to substitute product

introduced by new and existing competitors.

However in recognition to the business model, there potential pitfalls for the business level strategy and

as such the entrepreneurs should focus on solving challenges which include:

1. Too much focus on new value chain activities

2. All rivals of a product share a common input or raw material.

3. The strategy is imitated too easily

4. A lack of parity in differentiation

5. Erosion of cost advantages where the pricing influences.

 Model Approach to the Retailer System

INBOUN OPERAT OUTBOU

D IONS ND
LOGISTI LOGISTI
CS CS

Mark SER
eting VIC
& E
Sales

PROCU TECHNOLOGY
REME DEVELOPMENT
NT

HUMAN
RESOURCE
DEVELOPMENT

GENERAL
ADMINISTRATI
ON

Retail Value Chain System

PA P M O
RT U A P
NE R N E
R C A R
WI H G A
TH A I T
VE SE N I
ND & G O
M
OR ST D N
AR O I S
KE R S T
TIN E T O
G& G R R
SA O I E
LES O B S
D U
Business Tactics:

1. Acquire the concentration of facilities in the retail shops and store

2. Vigorous pursuit of cost reductions from customers

3. Target cost and overhead control

4. Avoidance of marginal cost on shoppers cost

Answer to Question 3:

The impacts of Internets have swept across the economy and now intensify on how every new and old

company conducts its business. Moreover, the presence of these technologies is so widespread that is

questionable and this is to say competitive firms have to update their strategies and set them apart from

rival competitors. The business strategy is adequate for overall cost leadership, as it tends to leverage the

price positioning of the organization products and secures into the mainstream corporate advert market

channels. This effort is to create a public image to the end user on the value of building an effective

network chain for its prospective customers.