Business model
Establishing a robust family-operated company requires having a clear structure, an understanding of how business processes will be organized. Since Mommy and Me will be a small business family enterprise, the most efficient course of initial action would be personally assuming full control of the operations. By doing that, I would efficiently oversee the early stages of the company’s development. However, as the business grows and other family members and friends contribute to its operation, I will likely accept them as partners. Under the partnership business model, we will be putting our resources and creativity together to expand the family company (Mbugua, 2021). In the end, Mommy and Me will benefit from the joint leadership of closely-related people interested in its success.
Target Market Segment
A small family business cannot spread the resources too thin to satisfy everyone. Instead, Mommy and Me will tailor its selection of apparel to the primary and secondary target market segments. Camilleri (2018) provided several marketing segmentation criteria, from which we will be specifically interested in demographics and geography. Mommy and Me will primarily target a local young-to-middle-age female population of our city and its vicinity. In addition, these women are quite likely to have families and children. Therefore, their children will become a secondary target audience for our goods. Children cannot buy anything on their own; however, their parents, particularly mothers, will visit our store and purchase children’s wear even if they do not need anything for themselves.
Start-up Funds
Mommy and Me will raise start-up funds from the four sources. Most importantly, I would self-fund the company by converting available bank balance, cash, and other resources into funds for business development (Zhao et al., 2021). After that, I would reach my friends and family, whose impact will serve as a foundation for future partnership and expansion. Furthermore, I would apply for the available state and government grants for small businesses. In addition, I would establish contacts with Angel investors, who might provide valuable resources. Lastly, I would avoid relying on bank and small business administration loans since this funding source would lower the return from operations due to the mandatory monthly payments.
Exit Strategy
Finally, a business plan should have an exit strategy for emergency cases, such as economic crises and subsequent unemployment, a decline in demand, and customers’ purchasing power. In the case of a family company like Mommy and Me, I would consider the following factors in planning an exit strategy. First, I would prefer a merger strategy, which reflects value and effort embedded into a family company (Chirico et al., 2020). Selling the company may be more profitable financially, but horizontally merging with another apparel outlet would allow managing the former family business. Second, I would ensure that the merger partner becomes a valuable addition to Mommy and Me; the merger should ultimately increase our market share and potential revenue. Overall, the exit strategy is based on overwatching the business after the deal rather than cutting the ties to increase personal profits.
References
Camilleri, M. A. (2018). Travel marketing, tourism economics and the airline product. Springer.
Chirico, F., Gómez-Mejia, L. R., Hellerstedt, K., Withers, M., & Nordqvist, M. (2020). To merge, sell, or liquidate? Socioemotional wealth, family control, and the choice of business exit. Journal of Management, 46(8), 1342-1379. Web.
Mbugua, D. (2021). The best business model for family businesses. International Business Times. Web.
Zhao, L., Shneor, R., & Sun, Z. (2021). Skin in the game: Self-funding and reward crowdfunding success. Business Horizons. Web.