Urban Outfitters Continuing Case Study

1. Identify at least three challenges when setting up a business. Explain why they are challenges.
There are several challenges an entrepreneur will face when setting up a business. In my opinion, the top three challenges are: deciding what type of business you want to have, establishing where to set up the business, and coming up with the money to start the business. I am certain that businesses encounter more than just these challenges, but these are definitely challenges that all sorts of businesses will come across in the start-up stage.
Deciding the type of business you want to start can be very challenging. You need to make sure your business is unique enough to draw customers in, but you also need to make sure you are selling something the customer wants to buy. Urban Outfitters, for example, came up with the idea to sell “used clothes, bohemian knickknacks, and ‘found objects’.” One of the founders was a college student and knew that the students didn’t have much money. They came up with a business uniquely for the budget of college students and sold items that they would want to buy.
It is also very important (and challenging) to come up with the “ideal” location for your business. You won’t find a five star restaurant or hotel in an area that is poor. Entrepreneurs need to keep in mind whom their customers will be in order to determine the ideal location. The founders of Urban Outfitters based their business off of the needs and wants of college students. Therefore, the ideal location for their business was close to a college campus. When Hayne expanded the business, he kept that tradition and opened up several other Urban Outfitter stores close to colleges.
Financially speaking, businesses generally cost a lot of money to start. Coming up with the money to start a business can be pretty challenging for some. There are loans available to help entrepreneurs with start-up costs. In the case of Urban Outfitters, however, they put their heads together...