Entrepreneurship 1

ENTREPRENEURSHIP

Name

Course

Professor

Date
 Entrepreneurship 2

Introduction

Entrepreneurship can be defined as the starting of a new business after proper designing. In
addition, this business is generally small in the beginning and may offer product, service or
process to the people. An entrepreneur is the one who starts the business after assessing the
demands and needs of the consumers (Barreto, 2013). The basic elements of entrepreneurship
include an individual, a market opportunity, and adequate resources to carry it out, a business
organisation and a favourable and conducive environment. The process involves formulation
of a business plan, hiring of human resources, obtaining financial resources, acquiring the
fixed assets, risk taking capability to be able to take the responsibility for the success and the
failure of the organisation (Cassar, 2014). In this assignment, an attempt has been made to
understand the thought process that goes behind starting a new venture with the help of an
Australian entrepreneur. The background and entrepreneurial traits of the person will be
discussed. Moreover, the opportunity recognition and the competitive advantage of the
business will also be discussed in addition to providing recommendations for further
improvement of the business.

Background

Ruslan Kogan moved to Australia in 1989 with his parents and sister. Ruslans parents had
just $90 when they came to Australia and used to work day and night to give proper
education to both the children. Growing up in such a background, he realized it very early in
his life that in order to become successful he would have to work hard and look for out of the
box means to earn money. Kogan started his first business at the age of 10 years when he
used to find the lost golf ball, cleaned them and sold for $0.50/each to the Elsternwick Golf
course players every Saturday morning (Hart & Kogan, 2013). He used to call this as the
challenge of the canal. He was a very tech savvy person and had started almost 20
businesses since the age of 10. The Kogan.com is his latest and most successful venture.

Kogan received a scholarship and joined Monash University to complete his Bachelor of
Business Systems after he completed his high school from Melbourne High School. He had
worked in the IT department of many famous companies like Bosch, GE and Telstra. He also
worked as a management consultant for Accenture (Birchall, 2013). Kogan was a calculated
risk taker from the very beginning and used to analyse data very well, when it came to
business environment. He attributes his success as an entrepreneur to this and not to sheer
 Entrepreneurship 3

luck. He sees success as being happy and often says that he maintains a proper work-life
balance in his lifestyle.

Entrepreneurial Traits

An entrepreneur is the central piece of a successful entrepreneurship. He/she should possess

the basic traits that are required for an entrepreneur to success. The person should have the
ability to perceive, pursue and exploit the available opportunities and execute the business in
a sustainable manner (Al Mamun & Ekpe, 2016). There are four key factors that helps one
understand the way entrepreneurs perceive and pursue the opportunities.

Firstly, they are busy searching for opportunities and exploit them. Ruslan had a business
mind-set from the very early age of 10 years itself. His first business venture was collecting
the lost golf balls and then cleaning and selling them to the golf players at the club.

Secondly, they should have the entrepreneurial alertness. This refers to the ability of
identifying the existing opportunities in the markets. Ruslan had a well-paid job of a
management consultant in Accenture but he left it and started his own venture. He saw the
weakness in the markets in the form of gaps between the demand and supply, and wanted to
fill those gaps. He started his venture Kogan.com, where he used to sell the private label
retail televisions. It grew to be the most trusted store in Australia for a wide range of
consumer goods. Ruslan found that the trend for online business is increasing and there is no
online e-commerce player who offers private brands. He exploited this opportunity and
executed it well.

Third, an entrepreneur should have prior knowledge. To start an online e-commerce business,
the basic traits that are required are the knowledge of business and technology. Ruslan holds
a bachelor degree in Business Systems from the Monash University. He was also a tech savvy
person from the very early age (Barreto, 2013). Regarding business knowledge, the person
had already started and executed around 20 business to have enough knowledge and
experience in the field.

Fourth, the person should have good social networking. Ruslan was very popular in Australia
as he started and executed a large number of businesses. He also made many acquaintances
and friends during his life. This gave him a proper social presence among the people. In
addition, he started a business that would attract a large number of retail customers that
would make him still popular.
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So it can be seen clearly that Ruslan Kogan had a proper entrepreneurial mind-set from very
beginning and he pursued what he was best at. The result was that Kogan.com became the
fastest growing business in the last five years in Australia.

Opportunity recognition and idea development

A successful entrepreneur recognizes opportunities by finding the inefficiencies in the

resource allocation or by discovering the imperfections in the competitive nature of the
market (Leutner & Ahmetoglu, 2014). This is the basic idea behind the opportunity
recognition by an entrepreneur. In case of Ruslan Kogan, he discovered that there is an
opportunity in the e-commerce space. He started his business in his parents garage. He found
that people who use the online shopping sites are increasing continuously but there are no
players in the e-retailing space who sell private label consumer goods. He started his business
by selling LCD televisions online (Bird & Schjoedt, 2017). Once the business gained
popularity, he then expanded his business by including various other products like
refrigerator, air conditioners, coolers and room heaters. He was continuously discouraged in
his path to success but he continued because he had conviction in his idea and faith in
himself. This is another very important aspect of a successful entrepreneur. He was driven by
passion and self-motivation.

He started with offering the televisions at a discount to his customers. Since the quality that
was being offered was good, people started liking the website and its popularity started
increasing. He encountered a major challenge of convincing the factories to supply him
products at a cheaper rate (Schwerdt, 2015). But the factories were not willing to take orders
that were so small in size. The basic step that most people take at this point of time is finding
an investor who could help Ruslan with an initial capital. But he didnt want to waste time
looking out for investors and instead helped the factories by organising their marketing
brochures and finding the loopholes in their marketing strategies. This helped him gain their
attention and as a result he started getting his supply.

Competitive Advantages

The main competitive advantage of Kogan.com was price leadership that was achieved
through efficiency (Morris & Webb, 2013). They use online marketing tools like Google
AdWords and AdSense very efficiently. They try to monitor around 100,000 keywords on a
daily basis. They used the technique known as targeted digital marketing wherein they used
to refine their bidding on the various keywords on a daily basis based on the popularity of
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those words. They also used analytics to figure out the types of customers that visit their site.
They used parameters like demographics, frequency of visits, most visited pages and least
visited pages. Then they tried to find out reasons for each of them which helped in better
targeting their customers. They also tried to modify their target audience on a regular basis.
These were the factors which helped Kogan.com gain a competitive advantage in the field of
e-retailing.

Recommendations

Although Kogan.com is extremely popular and is one of the fastest growing e-retailing sites.
However, there could be few initiatives which could be taken to improve the profitability of
the company and the brand perception in the minds of people. It can expand its product
portfolio by selling apparels and accessories through its website at a lower price than its
competitors. This would help it compete directly with the e-commerce giants like
Amazon.com and Flipkart.com (Mishra & Kotkar, 2015). These sites offer a full range of
products at a discounted and affordable price. Since Kogan.com has used analytics, data
mining and personalization so well to turn profitable at a much faster rate than others, it can
the similar techniques to attract people to its new offerings. Overall, the business model and
the passion and dedication of the man behind Kogan.com Ruslan Kogan is noteworthy and
sure to take the company to greater heights going forward.
 Entrepreneurship 6

Bibliography
Al Mamun, A. & Ekpe, I., 2016. Entrepreneurial traits and micro-enterprise performance: a
study among women micro-entrepreneurs in Malaysia. Development in Practice, 26(2), pp.
193-202.

Barreto, H., 2013. The Entrepreneur in Microeconomic Theory: Disappearance and

Explanaition. s.l.:Routledge.

Birchall, A., 2013. They're Kogan's heroes. Management Today, p. 30.

Bird, B. & Schjoedt, L., 2017. Entrepreneurial behavior: Its nature, scope, recent research,
and agenda for future research. Revisiting the Entrepreneurial Mind, pp. 379-409.

Cassar, G., 2014. Industry and startup experience on entrepreneur forecast performance in
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Hart, B. & Kogan, R., 2013. Method and Apparatus for Preventing Fraudulent Transactions
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Leutner, F. & Ahmetoglu, G., 2014. The relationship between the entrepreneurial personality
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Mishra, S. & Kotkar, S., 2015. A Study on Current Status of E-Commerce in India: A
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Computer Science and Management Studies.

Morris, M. & Webb, J., 2013. A CompetencyBased Perspective on Entrepreneurship

Education: Conceptual and Empirical Insights. Journal of Small Business Management,
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Schwerdt, B., 2015. Secrets of Online Entrepreneurs: How Australia's Online Mavericks,
Innovators and Disruptors Built Their Businesses... And How You Can Too. s.l.:John Wiley
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