Reference no: EM132855270

CASE SCENARIO: Starting a New Business

This case scenario will help you review the chapter material by applying it to a specific situation. Kelly Lee and Noah Walker meet in a marketing class and recognize that they have two things in common. First, they enjoy working with animals. Kelly's family breeds Irish setters, and Noah works part time in a veterinary office. Second, they both want to be entrepreneurs. After some initial market analysis, they decide to collaborate on creating a pet daycare center, Pet Haven, that will offer daily workouts for the animals, hourly playtime and petting with individual handlers, and clean and roomy cages or containment areas.

To get Pet Haven up and running, Kelly and Noah realize they must persuade either a bank or other investors to give them a small business loan. Then they must persuade potential customers to use their service.

Persuading Lenders to Fund a Loan

When Kelly and Noah go to the bank to discuss a loan for Pet Haven, the banker is interested in the idea but tells them their interest rate will be very high because they have an insufficient credit history and no collateral for the loan. To secure a more reasonable rate, he suggests they ask relatives to co-sign the loan application. In other words, their parents would have to agree to repay the loan if Kelly and Noah could not.

Kelly and Noah decide they need to convince their parents that Pet Haven is a sound financial idea. To prepare for these meetings, they brainstorm a list of questions their parents might ask:

Identifying Benefits and Objections

Based on Kelly's and Noah's persuasive business plans, their parents agree to cosign the loan. However, they insist that Kelly and Noah begin to market their business before graduation. As a next step, Kelly and Noah decide to learn more about their potential customers:

Building Credibility Through a Website

Noah and Kelly know that small businesses need to have a presence on the web to attract customers. However, they are not sure how best to use a website to increase their credibility with potential customers, especially because they are new to the business and do not have much experience.

Question 1: Identify at least two ways that Noah and Kelly can use their website to increase their credibility as part of their persuasive strategy.