Product economics/Exit

Product economics/Exit

The cost structure of the business:

Cost of entities	Cost proportion	Importance	Priority
Hire of employees	10%	3	2
System development	50%	5	1
Marketing	10%	4	3
Operational cost	20%	2	5
Customer service/support	10%	5	4

 

            The Content is the service and system that we designed to provide to our customer, it includes the tangible product as well as intangible such technical support and consulting service. The context is the overall looking of our business entity which create and provide the content. The community is the environment of our business which creates the industries and market that allow us to enter into. And finally the Value proposition includes the participation of partners in technical, customer relationship and marketing fields. We will directly reach our end customers to maintain our competence against the competitors and partners since as the end of the supply chain, we will have more control of the customer behavior, demand as well as a clear view on the market.

Summary

Still there are many other options to make this idea profitable. We can choose not to promote the system by ourselves, instead, licensing it to other vendors and charge fees. Or we can promote the system to the Enterprise resourcing planning companies and together we can create a ERP specifically in restaurant field. Either way we need to first analysis the industries and anticipate the opportunities that will or are existed within our business scope and then consider the IP issue because the intellectual property is the central value asset within our organization. With more concern on the initial investment on the business, the venture capital companies may be interested to help. They can be rewarded with preferred stock and certain amount of common stock since preferred stock holder does not have the voting right. So we can reduce the risk of not aligning with the venture capital’s business strategies. We can either give them dividend or share them certain percentage of income for a period of time. The VC will be able to realize its value by holding our stock and getting great reputation from our success.