Week 12: Venture Concept No. 1

Opportunity:

Earlier last year, I was diagnosed with a chronic disease called Interstitial Cystitis. The day I got the diagnosis, I was handed a pamphlet of my new diet to follow for the rest of my life. Things to avoid included chocolate, orange juice, tomatoes and their byproducts such as ketchup, alcohol, yogurt, sports drinks such as Gatorade, and cereal just to name a few. As someone with an already picky diet, this practically eliminated half of my options from now on. Enough about me though, an estimated 8-10 million people have Interstitial Cystitis alone. This got me thinking about other dietary restrictions in the world today. Whether for personal, religious, or medical reasons, there are many diets today including gluten free, kosher, diabetic, vegan, vegetarian, and lactose intolerant. Food is a necessity of life and any one of these dietary restrictions limits these options. Because there are so many different types of restrictions, there are no exact figures, but if you add up these 6 segments alone, that’s over 50 million Americans with dietary restrictions, so there is a huge unmet need. Going to the grocery store, by now we know the types of foods we can and cannot eat, but restaurants and premade options are much harder because you need to know the complete list of ingredients to ensure that you can have that type of food. There are no grocery stores specifically designed to meet the needs of people living with dietary restrictions. We are lucky if things are properly labeled, or if there is a section properly identifying our particular segment. This will continue to be an opportunity forever because these diseases aren’t going anywhere. Actually, the numbers are increasing, especially with genetic diseases, so unless a cure is developed, these segments will only continue to grow.

Innovation:

I am proposing an on campus grocery store, similar to the POD that specializes in foods for those people with dietary restrictions. It would be open for extended hours so you could run in for a midnight snack, and be at reduced prices because it is for college students and faculty. Often gluten free flour or cheese that contains no dairy is extremely expensive because they only cater to smaller segments. However, you may not know that common foods also meet these demographics such as Oreos, which are vegan, and Tostitos, which are gluten free. This means that anyone would be able to shop at the market because it would carry “normal” snack food that also happens to fit these needs. It would make a profit because simply a grocery store on campus is long overdue, but also it would fit the needs of many different types of people, so anyone could shop there and appreciate the cheap prices, convenient location, and extended hours.

Venture concept:

I think it is fairly straightforward that nothing exists that specifically addresses the needs of people living with dietary restrictions. Potential customers would not be switching from any other company because there is no current competition. Distribution and business location play a fairly significant role because part of the benefit of this idea is that it is on campus, but it is relatively easy to get supplies to these areas, so it would not be hard to use existing suppliers to get the resources to the market. Like I mentioned before, it would be fairly similar to the POD market, so a small on campus grocery store with about 3 employees to start. These employees would have a nutritional background so they would be able to answer questions about what foods are safe for certain segments, and also specialize in customer service. I think starting small and seeing the popularity is always smarter, just to build your reputation and get the word out, and then expand from there.

Other elements:

As I mentioned in my unfair advantage assignment, I would have to say that my top resource is reputation because it is the combination of numerous elements working together. Intangible resources are harder for competitors to copy and certainly take time to develop. Someone may be able to sell similar products, but adding the welcoming atmosphere, great hours, convenient locations, and experienced staff, all contribute to a reputation that sets my business apart. A positive reputation is essential in any industry, and is a key factor in being the best for years to come.

I think the next thing is just expanding the product line. As new products come out, just being sure to keep up with market trends and listen to customers. As I mentioned on a previous assignment, with technological innovation and genetically modified foods, I think science could potentially develop foods that are safe and delicious for those who can’t eat traditional key ingredients such as regular flour, sugar, or wheat. Seeing what the future holds in terms of science and innovation will be interesting in years to come.

Having a personal connection to this, I am very passionate about finding alternative foods that actually taste good for people living with dietary restrictions. I would love to stick with this and keep a personal stake in the company. Management would be nice, but my skills are in marketing, communication, and customer relations. Wherever this may go, I would want to make sure that I am actively involved and not calling the shots from behind a desk. Possibly partner up with someone whose talents are more administrative so I could run more of the employees and customer feedback, whole they focused on business and company operations.

Week 11: Amazon Whisperer

1). My revenue drivers are the convenience of having groceries and fresh produce that fits the needs of certain unmet sectors, specifically those with dietary restrictions such as gluten free, vegan, lactose intolerant, kosher, and diabetic, in an on campus market at a reduced price. Having a store on campus with convenient hours, low prices, and foods not offered at tradition grocery stores are the key resources that make us different.

2). Just as gluten free has become a recent trend in many upscale bakeries, such as cupcake shops, I think the focus in the future could be expanding to be accommodate many different dietary restrictions. Eventually science and technology could potentially create ingredients that both tastes good and are able to be digested by those with certain limitations. For example, creating a wheat substitute that can be digested for those with celiac disease or a sugar that diabetics could process. Genetically modified foods are currently being developed, so I don’t think it’s an impossible task to be developed in the near future.

3). If advances in science ever got us to that point, this would be extremely beneficial because a market such as this could expand and sell other types of foods with these new ingredients. It could also expand the customer base because if it tasted as good as the regular ingredient and was sold at a similar price, others may buy it too. For example, if a man was married to a diabetic, he could buy this sugar and eat it himself as well because he is already buying it for his wife and it tastes just as good.

4). The product I described above does not currently exist yet. It is an ideal model to hopefully be invented in the near future, so I had to loosely interpret this to just be something similar on Amazon. I chose a gluten free flour that is commonly used in baking since we were talking about similar ingredients above. Pamela's Products Gluten Free Artisan Flour Blend currently ranks 4.7 stars on Amazon with 466 customer reviews.

               

5). The customer reviews are very high for this product, averaging at 4.7 stars out of almost 500 reviews. For the negative comments, the principal complaint is that baked goods are sometimes too dense and flavorless compared to similar flours. Similar complaints stated that it is chalky-tasting and can be too crumbly. As far as the positive reviews, 68% gave it 5 stars, so definitely a majority. They like that the flour can be used in almost any recipe and it turns out consistent every time. Many of the reviews even say that they use it as a substitute for regular flour and prefer it.

6). It is flour so there is not much to change for the design. I like the packaging and the reviews are mostly positive, so I would agree that they are doing something right. If I were to change something, their pancake mix has a perfect 5 star rating, so I might adapt some of the successes from other more successful products and see how they could potentially improve this one. I am by no means an expert baker, but if anything, I would thin out the flour slightly too to make it more refined based on customer reviews.

7). For a store that specializes in groceries for those with dietary restrictions, this product would fit perfectly. Someone who is gluten free and wants to bake some muffins could run in, pick up all of their ingredients at our market, and go home to bake without worrying about checking the labels 100 times to see if it’s safe or not. This flour would be a great addition to sell in our market because it further diversifies our product line.

Week 13: Reading Reflection (Chapter 14)

1). The most surprising part for me was the section on Africa and Brazil. As the box mentions, these two regions were formally considered third world countries, and now they are quickly on the rise. Africa’s growth surge was in large part thanks to governmental action, and Brazil is experiencing its greatest economic growth in history. Their rising valuation has placed them both among the world’s most rapidly growing economic regions.

2). The most confusing part for me was the section on the vocabulary common in term sheets. Because we don’t use this terminology in our everyday language, it was a little harder to understand. The differences in the types of rights and the types of preferences can be a little confusing because we are less familiar with these terms.

3). My first question would be how he accumulated the checklist for analyzing a business? Because it encompasses so many different areas and is so long, I would like to know why he chose to include certain concepts and not break it up into e few smaller charts instead? My second question would be if the author himself has ever encountered emotional bias?  I think this is an easy term to apply to business because we tend to overvalue things that we have a personal connection to, so I’d be curious if the author himself has any experience with this.

4). I did not disagree with anything in this chapter. Understanding how to value a business is rather complex, but the author organized the material in a very logical manner and explained each concept well.

Week 12: Reading Reflection (Chapter 13)

1). I was most surprised by the section on the “Fab Four” companies. I would definitely consider Apple, Facebook, Google, and Amazon to be the best in each of their respective fields, but it was interesting to get each of their histories and relate them to the entrepreneurship process. Each of these companies have been special since the beginning in terms of creativity and originality, but pointing out what specific strategies and innovations have made them successful was unique.

2). Nothing in particular was confusing in this chapter. A lot of these concepts build off of many things we have learned in the past, so it was fairly straightforward. I would have to say the most complex section would be the entrepreneurial strategy matrix because you are choosing an appropriate strategy based on the existing risk and innovation levels. The author did a good job explaining the concepts in this chapter though.

3). My first question would be why is it important to differentiate between the entrepreneurial and administrative and entrepreneurial point of view? He elaborated on the differences between the two, but it seems to me that working to better one often improves the other as well, so why make the distinction? My second question would be if the author himself ever encountered the growth wall in his career, and how he worked to overcome it? I think many people encounter obstacles in life, both personally and professionally, so what struggles did he face along the way?

4). I partially disagree with “fatal vision #3” when discussing strategic planning. The author states that one should not pursue an unattainable competitive position because if the venture succeeds, competitive advantage cannot be sustained. While I understand where he is going with this, I somewhat disagree in the way it’s worded I guess. I think you should always aim high and allow room for growth, just be smart and realistic, especially in fast-growing industries. I think it doesn’t hurt to have big dreams as long as you don’t get too far ahead of yourself.

Week 11: My Unfair Advantage

1). Selection of groceries/produce- the whole idea is that there are more options to chose from for people living with dietary restrictions, assortment

V-very valuable, basis of entire business idea

R-currently yes (although future demand is likely to increase so likely to be copied by competitors)

I-can be imitated, easy to physically sell a wide variety of products

N-currently has no equivalent, closest is a normal grocery store or farmer’s market

2). Experienced/knowledgeable staff- hire employees with a high degree of familiarity about nutritional content of groceries (for example- if someone who is gluten free can eat a certain type of cereal)

V-yes, can add value by helping customers and answering nutritional questions

R-not extremely rare to have educated employees, but rare in this industry, rare to have workers at a grocery store be able to answer questions about nutritional content

I-could be imitated, but would be difficult

N-somewhat, you could potentially Google certain questions on your Smartphone but extremely beneficial to have a person on site to answer questions instead

3). Convenient location- for college students, having a grocery store on campus is ideal because of the accessibility of the physical location

V-very valuable, on campus and close to target demographic of students

R- sort of, could get location nearby but physical building/store is unique to company

I-can be copied in the sense that you could open next door or across the street

N-has no equivalent

4). Originality of business concept- currently, no grocery store focuses on the needs of people living with dietary restrictions in particular, such as being gluten free, lactose intolerant, vegetarian, or kosher, so these segments are now the emphasis

V-yes, first to the market/industry

R-yes, no one else exists in the market as of now, no competitors yet

I- competitors can imitate the idea, but we will always be first

N- has no equivalent, nothing else provides a similar benefit

5). Customer service- employees are polite and willing to answer questions, possible background in the service industry or communications

V-yes, customer service is important in any industry

R-not extremely rare, but higher quality than most

I-can be imitated to a certain extent, but not duplicated

N-no equivalent or similar service

6). Convenient hours- as college students, we are often hungry for a midnight snack, so staying open late is a major benefit that differentiates us from other grocery stores

V-yes, enables customers to shop whenever is convenient for them

R-yes, not many grocery stores or markets are open late

I-could easily be imitated, but not many people do it

N-no real equivalent, not much else open late except gas stations which is only junk food

7). Community outreach- staying connected with campus and being involved with the community we’re situated within is a major priority

V-yes, adds value, exploits opportunities

R-relatively rare, few competitors are actively involved with their community

I-can be imitated if other firms wanted to copy

N-has no equivalent, nothing else provides the same service

8). Quality of groceries/produce- ensuring there are options for fresh produce, organic fruits and vegetables, and the best brand name snack foods is essential

V-yes, exploit opportunities by providing this particular selection all together

R-not extremely rare, possessed by other competitors

I-can be imitated or copied by competitors

N-similar products of lower quality would be comparable

9). Strong organizational culture- fun workplace atmosphere, high employee morale, low employee turnover

V- very valuable, adds a welcoming environment to an already great store

R-yes, very unique and individualized to the company

I-cannot be copied by competitors, although they may try and imitate certain parts, organizational culture cannot be duplicated

N-no equivalent

10). Reputation- the accumulation of all elements working in harmony, translating the highest quality to each customer that comes into the store

V- extremely valuable, encompasses everything

R-yes, organizational culture and atmosphere is unique

I-yes, cannot easily be copied by competitors

N-has no equivalent, nothing else provides a similar benefit

I would have to say that my top resource is reputation because as I mentioned, it is each of these elements working together. Intangible resources are harder for competitors to copy and certainly take time to develop. Someone may be able to sell similar products, but adding the welcoming atmosphere, great hours, convenient locations, and experienced staff, all contribute to a reputation that sets my business apart. A positive reputation is essential in any industry, and is a key factor in being the best for years to come.

This video elaborates on the importance of a good reputation. Although she focuses more on a personal level than a business, the same principles hold true for both. Your actions and the way you conduct yourself on a daily basis form your reputation over time, and you want others to think of you in s positive light whenever they hear your name. Here is a link to the video: https://www.youtube.com/watch?v=HiyZ8sQaafI