Showing posts with label entreprenurship. Show all posts
Showing posts with label entreprenurship. Show all posts

Tuesday, November 1, 2011

Entrepreneurs in auto service industry

In recent posts, we were mainly devoted to automobile companies, their profits, supply and demand, international attitudes, promotion and popularity of the brand, etc. However, it is important to mention that it is not just about to selling or buying cars, it´s also about how to keep it in shape . I found some interesting stories of entrepreneurs who started their small business in the last century and who are progressing in its development so far.

One of these companies is Ziebart International Corporation that is the worldwide leader in vehicle appearance and protection services (1).The company was found in 1954 by Kurt Ziebart, a German mechanic, who developed a process to stop corrosion and opened the first Ziebart store in Detroit (2). The company began franchising in 1963 and has grown to a network of approximately 400 locations in 30 countries (1). The main reason of their success is probably the fact that they focuse on three main sources of profit: professional detailing, window tint and protection.


Another successful entrepreneurship we can see in the founding of Big O Tires. A franchise is now based in Englewood, Colo and was established in 1962 by a group of independent tire dealers. "Each Big O center offers a variety of auto repair services, including brake, alignment and front-end repair, as well as tire and ride control products" (3). Like earlier mentioned company, Big O Tires has grown into one of America's largest retail tire franchisors, which is based in 21 states (4).

To become a  prosperous founder of a company, an entrepreneur must show discipline and calmness when the business fails. He must also be prepared for the tolerance of risks and show great attention to details. As an entrepreneur doesn´t have a boss to keep him at work when necessary, he must find his own balance (5).

Sources

Monday, October 31, 2011

Entrepreneurship and its Affect on Market


A high school friend worked for entrepreneur Michael Hinderliter for about 2 years. My friend's job was to prepare and serve bubble tea for the Chill Bubble Tea franchise, but he came into contact with the owner because they shared a common interest: custom car parts. The entrepreneur also ran a car parts importing business. He started by importing crates of the parts he wanted for his car and selling off the parts he did not need on the internet and eventually became the sole US importer for an international suspension manufacturer (1).


It is not easy to enter the auto manufacturing industry; the barriers to entry are very high (1). Tesla Motors is one example of a successful auto manufacturing business, but they are the minority: Their electric car sector has countless examples of failed start-ups. The affect their success has had on the auto market is also very limited: they expect to sale only 20,000 by 2013 worldwide (2).


Opportunities to enter the auto manufacturing business are therefore severely limited. Despite this, there are opportunities for entrepreneurship within this industry. There are opportunities for new firms manufacturing and importing after-market performance parts, like in the case of Hinderliter. Often these new parts will fill different niche markets in the aftermarket parts sector.


There are also opportunities for entrepreneurs to enter the auto industry by participating in its distribution chain. Most auto manufacturers sell new cars exclusively through franchised dealerships (4). Because cars are among the few products still only available through a physical retail location, entrepreneurs can affect regional markets dramatically by bringing new manufacturers to an area. Because car prices are often negotiated at the dealer, the price for a new car can change dramatically if there are more dealers in an area selling cars in the same segment or even of the same model.


Sources
(1) Michael Hinderliter, personal communication (2011)
(2) http://mises.org/freemarket_detail.aspx?control=384
(3) http://money.cnn.com/2011/06/21/autos/tesla_roadster_selling_out/index.htm
(4) http://pubs.aeaweb.org/doi/pdfplus/10.1257/jep.24.3.233
(image) http://upload.wikimedia.org/wikipedia/commons/thumb/9/98/Lexus_Car_dealership_%28setagaya_tokyo%29.JPG/800px-Lexus_Car_dealership_%28setagaya_tokyo%29.JPG

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