...Frustrated by errant page markers, Arthur Fry wanted a way to hold bookmarks in his hymnal while singing in the church choir. He was aware of an adhesive accidentally developed by fellow 3M employee Spencer Silver. Applying this weak glue invention to yellow paper, the post it was born (Hall, 2013). 'This defines entrepreneur and entrepreneurship - the entrepreneur always searches for change, responds to it, and exploits it as an opportunity' (Drucker, 2015).
This report aims to reflect on the process of developing and implementing our business project based on entrepreneurial concepts. And shed light on what we achieved and how we dealt with various setbacks.
The venture creation framework (figure 1) provides a comprehensive structure to help entrepreneurs find, explore, develop and implement business plans (Hackings, 2016).
The first step is finding a business idea. According to Burns, this begins with the 'eureka moment'- when a business idea is born. Entrepreneurs either 'create opportunity' by making a new innovation or 'spot opportunity' by looking for changes in the existing market structure. After using some of Burns methods of generating ideas like brainstorming or making mind maps (Burns, 2014). Our group came up with a range of ideas like starting a cleaning service, being tour guides for golfers in St. Andrews and setting up dessert bars in student accommodation. We finally settled on hosting a 'Fall Fit Fair' to promote a healthy lifestyle to the students and locals of St. Andrews.
Connectivity and Networking are essential factors in this step. A connection to what is going on in the society helps acquire new ideas and information. Networking involves meeting a range of people and broadening our perspective (Burns, 2014). We connected with the whole foods store opening on South Street to open a stall at our fair, so they could promote their products and get familiar with the residents of St. Andrews. We also contacted fitness shops in Edinburgh and Dundee like Lululemon, Run4it and Sweaty Betty to open pop up shops at the fair. This would benefit the retailers by increasing their sales and the students as St. Andrews has a limited number of stores. We called Taste and Zest to open health food stalls. And we later decided to invite the Yoga, Dance, Shimmy, Tai Chi and Pilate's societies allowing more individuals to gain membership.
The last stage of this step is to test whether the business idea is viable and sustainable. One should have the skills required to be an entrepreneur and fit their business idea to the market structure (Burns, 2014).
The second step is, understanding the market. Market research helps estimate the size and growth of the market. It gathers information about customers like age, personal characteristics, socioeconomic group, occupation and location. It creates awareness of why, when and where customers buy and the nature of economic and environmental trends that might affect the business (Burns, 2014). The need to understand conventions in markets is critical to opening new outlets, thus our group used a primary research method of face-to-face surveys. Each member of the group went around town and asked students and locals if they would be interested in a fitness fair and what product or service would they want to purchase. The results were extremely positive and so we decided to go ahead with our fair.
To develop a business model, it is essential to identify the market segment and core value proposition for the business idea. Market segment can be established by four factors- geographic, demographic, psychographic and behavioural (Khalik, 2016). The value proposition is why customers will buy from one company over another. The core values include - low price, high differentiation and customer focus (Burns, 2014). Our target market was the locals and students of St. Andrews who wanted to make a change in their lifestyle, wanted an exposition of the fitness oriented businesses in town or just wanted a shopping venture. We set low prices as we were focusing on students who are on budgets. Thus we targeted the health and cost conscious consumer. Our value proposition was the combination of local business, societies and food that promotes 'healthy food, healthy mind and healthy life'. The consumer could walk away with a new society to take part in, a new favourite local business, and a satisfied palate.
The third step is devising a marketing strategy. Marketing develops an integrated strategy based on consumers and competitors and combines it with strategic inputs like finances, human resources, research and development. A well planned strategy promotes the business, builds a loyal clientele, allocates resources efficiently and maintains the reputation of the firm. It focuses on long term, sustainable advantages (Wind and Robertson,1983).
Marketing begins with setting the organizations values and vision. The values determine how the organization will function and the vision is grounded in the purpose of the organization and should engage people. The mission statement reflects the organizations' goals and means to achieve it (Burns, 2014). Our values included passion for a healthy life, teamwork to achieve goals, integrity and honesty to vendors and consumers. We envisioned the idea of 'healthy body, healthy food and healthy life'. Thus, the mission statement of our venture was to promote a healthy lifestyle by providing information and arranging opportunities for consumers.
The next stage in marketing is creating an identity. A clear identity means that consumers recognize their purchase and repurchases it as the marketing mix (price, product, place and promotion) meets their needs. Branding is a marketing tool that ensures customer loyalty, brands should not only be a logo but should also represents the company's values (Burns, 2014). For our venture we created a clear identity by generating a unique concept- fitness fair. We did not have an entry price. Our location, the parliament hall, was an easily accessible place. We arranged products from fitness stores and organic shops. Our fair aimed to promote a healthy lifestyle. We also created a logo for our fair (figure2), however at this stage we do not have a recognizable brand. We hope to shape the identity of our start-up to make this an annual fair.
Communications media is also used to spread awareness of a new business. There are several methods like word of mouth, viral marketing- social networks and media, guerrilla marketing and advertising (Hackings, 2016). Our group created a strong communications campaign. We used word-of-mouth to inform our friends about the event who then informed others and thus increased awareness. We also used social media like Facebook to provide students of St. Andrews information about the time, date and venue of our event. We additionally used traditional methods of advertising like visually attractive flyers and posters to make sure the local residents were informed as well (figure3). In order to attract more consumers we had incentives like free classes offered by Dance, Shimmy and Tai Chi societies and a raffle system for free Yoga classes and Pilates for a month.
Another stage in this step was identifying competitors in terms of their product/service, size, profit, customer segments and the quality of their value proposition (Burns, 2014). We thought the fresher's fair would be a competitor to our fall, however our tutor assured us that our fitness fair offers a consolidation no other venture provides. Thus we adopted marketing strategies for weak competitive position (Burns, 2014).
The fourth step is advancing an operations plan. This should produce a series of milestones and deadlines to achieve them. It involves detailed planning and hard work. The operations plan is divided into two. First, pre-launch- things that need to be in place prior to launching the business. Second, operations- things that need to be done during the business (Burns, 2014). Our operations plan was very cut and dry. We had bi weekly meetings and a weekly tutorial. We divided the tasks into two- those responsible for logistics and those responsible for marketing. The members responsible for logistics secured a venue, analyzed the finances, invited and confirmed with all the vendors. While members responsible for marketing focused on spreading awareness of the event, designing flyers and posters and creating the Facebook event. All members of the group oversaw the overall execution of our event. Even during the event we divided into two groups. Some of the members stayed at the fair and helped organize while others handed out posters and flyers in places like the union and library- where most of the students go. We later realized this was not an efficient way to divide roles. A further, more detailed division of roles into categories likes head of creativity, finance, marketing, PR, etc. would involve each member more and ensure that all the tasks were completed.
While launching retail business the 'place' element of the marketing mix is the most crucial. The location must provide access to the target market and should not be chosen because many people pass it (Burns, 2014). Our group picked the parliament hall as it was central, easily accessible, had enough room for each vendor and had place for people to try on fitness clothing. However, since Lululemon and many other merchants backed out last minute we were left with a large location for very few vendors- thus making the fair seem extremely empty.
The fifth step is risk control and strategic options. One cannot start a business without taking risks. Risks can be difficult to predict. Our risks included a reliance on the vendors and being unable to compensate the capital paid by each member. Since we had no entry charge, we decided to charge each vendor fifteen pounds, in order to make a profit. This was a major risk as, if vendors cancelled we would lose profit and resources.
The sixth and last step is financial planning. Finance is required to create a business, gain assets, develop products, run market surveys and advertise. Organizations have to focus on being reactive, efficient, quantitative and risk averse (Griffin, 2016). New ventures require finance to get started and goal is to make profit. For the 'Fall Fit Fair' we had to pay a cost of 150 pounds in order to secure the parliament hall. To encourage larger footfalls and to promote a healthy lifestyle we decided not to charge an entry fee. We charged each vendor coming to our fair 15 pounds in order to recoup our cost price and make a profit. However since a few of the vendors backed out we could not make the profit we wished to and ended up incurring a loss of 30 pounds.
We faced various barriers and setbacks. A week before the fair Lululemon- the only fitness shop that had agreed to come, backed out. This was a considerable obstacle for us, as we did not expect it. On hearing Lululemon had backed out, other food vendors like Taste and Zest also declined from coming. Even the Tai Chi and Yoga societies were busy on the day. Due to this setback in the eleventh hour, we did not have adequate time to implement a new business plan. We had already secured the parliament hall, which seemed extremely empty due to the lack of vendors. Since our only sources of income were the vendors we ended up making a loss of 30 pounds.
Considering we had multiple obstacles, we had to really step up as a group. The most important imperative for a service business is the ability to deliver the service, and that depends on the knowledge, skills and abilities of those delivering it (Burns, 2014). We met with the Tai Chi and Yoga society and learnt information on each of them so that we could represent both at the fair. Partnerships, alliances and joint ventures are good ways of exploiting a business opportunity when you don't have enough resources (Burns, 2014). Thus we decided to approach another enterprise project and asked them to sell their bubble tea at our fair. This would provide us with a mutual advantage- we would obtain another vendor and they could sell their tea free of cost price. However, this did not work as they did not have inventory to make a fresh batch for our fair. We then decided to prepare healthy food and smoothies by ourselves, this was a brilliant idea as it increased the resources for our fair. Besides these setbacks, we did get payed by the vendors who attended the fair and thus did not make a tremendous loss. The turnout was good, as various students and locals were interested in the concept of a fitness fair. It was overall a good learning experience as we understood where we made blunders, we should have had formal contracts and agreements with the vendors (making it difficult for them to back out) instead of communicating through email and over the phone. We do wish to repeat this fair annually as 'Fall Fit Fair' is a unique and valuable concept that got positive feedback from the students and locals of St. Andrews.
As Dr. Ronald Niednagel (2012) says 'Failure isn't failure unless you don't learn from it'. This enterprise project was a beneficial learning experience.
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