Opportunities of New Business - Term Paper Example

? BUSINESS PLANNING ………………………….. College ……………………………… ……………….. Words count: 1749 Introduction Discovering a newer business opportunity and grabbing hold of it with dynamic and strategic business activities are perhaps the most rewarding research and development in the field of business. A business opportunity, as an idea with compelling commercial potential, is not a guarantee of success but it represents a likely project for establishing a successful business. This paper puts forward a new business idea developed on the basis of potential market demand for fresh and premium quality natural fruits and vegetables to be available in retail outlets of supercentres and hypermarkets. This paper presents a brief feasibility study about the ‘logistics’ business based in London to channelize the distribution of fresh fruits and vegetables to retail outlets around UK. The business idea The ‘Fresher Pvt Ltd’ will be a unique logistic and supply chain company and an exciting experience of ‘freshness’ designed to fulfill the responsibility of providing the target market with ‘fresh’ and premium quality natural products. The business idea is about logistics based in London to collect freshest and supreme quality natural fruits and vegetables directly from farms in different countries and supply them to retail outlets such as supercentres and hypermarkets. The very basic functional principle of the company will be based on the ‘six rights’ that a normal logistic company is required to fulfill. Therefore, the ‘Fresher’ is highly concerned about distributing the right and fresh fruits and vegetables to right customers at the right time in the right condition at the right place and at the right price (Voortman, 2004, p. 3). The ‘Fresher’ is not just a new opening of a logistic business, but, it is the output of a new idea to uncover a hidden market opportunity for meeting the demand for ‘fresh’ fruits and vegetables available in large-scale retail outlets in lowest price possible. Fruits and vegetable goods presently available in supermarkets, hypermarkets and other retail outlets often lack the quality and values of freshness that customers expect them to be. The Fresher Pvt. Ltd proposes to replace these goods with ‘freshest and most genuine natural fruits and vegetables’ supplied directly from farms around UK and from abroad. For this purpose, the company plans to enter in to strategic alliance with large-scale farmers in both UK and foreign countries including India and Sri Lanka to collect the most freshest goods directly from the farms and to transport them as quickly as possible with latest cold-storage facilities to make them available in large retail outlets. Going directly to farms in other countries and collect fresh fruits and vegetables from the farmers seems an idealistic social movement. Thousands of farmers in countries like India are deprived of better facilities and opportunities to market their products. They neither get advanced facilities to transport or quickly supply them to markets nor get right prices for the goods they supply to markets. The ‘Fresher’ is going to influence the media to gain wider reputation for a social movement to extend the helps to poor farmers in other countries. The company proposes to utilize the resources, mainly the excess agricultural products that have been of no proper marketing use for that the farmers in India and other developing as well as under developed countries did not effectively market their products due to fewer facilities or decreased demand or reduced prices for their goods. The ‘Fresher’ would satisfy these farmers by providing financial assistance for post-harvesting preservation and for advanced transportation facilities. The Fresher will increase the demand for their goods and value their products to return fair prices for their vegetables and fruits. The company helps them by creating a market for these premium and fresh goods in parts of London. The business idea is highly attractive because the ‘Fresher’ will gain the advantage of ‘cheapest and most competitive’ fruits and vegetables from countries like India. The goods directly from farms in India will cost below 20 percent of the present market price for the same in London market. The transportation, technology, cold storage etc may approximately add up 20 percent to the cost. But still, the ‘Fresher’ can dominate the market as it can offer these freshest goods for as cheapest as 50 percent less to the present market price. In recent study, Poulter (2012) reported that fruits and vegetable prices have soared by 50 percent within one year due to wettest summer and other factors as well. The increased prices for fresh fruits and vegetables means that people’s consumption is reducing by 25 or more percent and thus they get less to their healthy diet. The fruits and vegetable prices in London market is ever increasing and therefore, this seems to be an opportunity for the Fresher’s business idea to market the cheapest and freshest goods directly from India. Industry Related Issues Logistics is one of the fastest growing industries in UK and across the world. The UK total logistics market has been estimated to be worth around €30 billion in 2006 (Rushton and Walker, 2007, p. 54) and this has grown to become worth over ?93 billion to the economy by 2012 (Skills for logistics, 2013, Business matters, 2013). The UK logistics market makes up 10 percent of the total GDP and logistics operators in the UK are leading businesses (Baxter, 2013). Including various sub-sectors of the logistics industry, the UK logistics industry is growing rapidly and has been reported as the fourth largest logistics industry in Europe. The fruits and vegetables market in London especially throughout large scale retail outlets represent a significant segment of UK’s economy. The general public are mostly found satisfied with shopping from large scale retailers such as Tesco, Sainsbury’s, Asda etc and are found to be highly satisfied for quality, convenience, amenities, competitive price etc. However, recent reports revealed that public can save up to 32 percent of fruits and vegetables prices by shunning large scale retailers and buying from street markets. Fruits and vegetables in sold in street market are 32 percent cheaper as compared to the prices of supermarkets and hypermarkets. Davies (2012) reported that shoppers can save up to 32 percent for buying fruits and vegetables from market stalls instead of buying from large retail outlets. The business idea of the ‘Fresher’ is to target millions of customers by providing ‘freshest’ and premium quality fruits and vegetables in cheapest prices. Customers also get advantages of tasting different fruits and vegetables from abroad. Target market and customer focus The target market represents millions of customers who every day visit large scale retail outlets including the top market leaders such as Tesco, Sainsbury, Asda, Waitrose and so on. There are more than thousands of large scale retail stores in various parts of London and each of these retail stores attracts more than hundreds of customers every day. The major targeted market includes customers who demand fresh and higher quality fruits and vegetables for their daily use. Fruits are demanded for individual or family uses or for programs such as events or celebrations. They are also demanded by businesses or shops that market juices, sweets, frozen yogurts etc. As critical elements to the business strategy, the Fresher will take customer orientation in to account. For achieving customer focus, the company will provide premium quality goods, take care of the corporate and individual customers, take care of the affiliate partners and help farmers in poor countries. These are the main success keys to the strategic business focus of the ‘fresher’. In order to ensure customer satisfaction and customer focus, it is critically important to see what customers really demand in the market, how their demands and needs can be satisfied and what distinctive business ways to be used for satisfying these needs. Customers behave differently in the market since they have individual requirement and preferences. The ‘Fresher Pvt. Ltd’ needs to conduct market research to study about the individual preferences of customers for fruits and vegetables. Founder related issues The logistic business idea is not new. Marketing fruits or vegetables to large retailers is also not a new business idea. However, collecting fresh fruits and vegetables from farms that can sell them cheaply and supplying them by using advanced technology of cold-storage and transportation to large retailers in London to offer these goods to the potential customers for highly competitive price seems to be a unique business idea. There are no issues related to the founder of this business idea. The business has to undergo legal procedures for procurement, logistics and strategic alliance with farmers in other countries. Financial Issues Establishing a logistics business is not going to be an easy task. It requires huge investment mainly for latest technology-assisted transportation, advanced cold-storage and for further legal or otherwise procedures for strategic alliance with large farms abroad. The company has to invest heavily on research and development and innovative technology for maximum speedy transportation etc. The initial investment for these purposes would certainly amount more than ? 5,00,000. The business will be started up as a private limited company. As a private limited company, the company can raise funds from bank loans and mortgages for further investments including technology, building, vehicles etc. The company can achieve the financial success only by providing high quality goods and highly valued services through ongoing supply of fresh fruits and vegetables and by reducing operational expenses. The financial projects show that the company will be able to break even after the first year of operation. Overall Business Potential No business can successfully perform unless there is better marketing opportunity and the company can strategically seize it. For the ‘Fresher Pvt. Ltd’, the opportunity is highly rewarding and it has designed and developed effective and idealistic way to seize this opportunity. Customers who visit large retail outlets want freshest fruits and vegetables, but are most often dissatisfied for that they are less fresh and are not competitively priced. Fresher proposes to go abroad for collecting freshest fruits and vegetables directly from farms and to market them through large scale retailers in London. This business idea will certainly pave way to establishing a successful and highly powerful business enterprise with highest potential for achieving greater returns on investment. Conclusion This piece of research paper has outlined a newer business idea and has presented an ideal business model for converting the idea in to a realistic business model. The ‘Fresher’ will be a unique logistic business for that it has identified a highly rewarding business opportunity and has found successful way to grab this opportunity. References Baxter, A, 2013, Transport and Logistics, Clarion Events, Retrieved from http://www.clarionevents.com/business-to-business-events/markets/transport-and-logistics Business Matters, 2013, Entries open for 2013 FTA Every woman in Transport and Logistics award, Business Matters Magazine, Retrieved from http://www.bmmagazine.co.uk/in-business/13151/entries-open-for-2013-fta-everywoman-in-transport-logistics-awards/ Davies, D, 2012, Can shoppers really save '32%' on fruit & veg by shunning supermarkets for Street markets? We test the claim, This is Money, Retrieved from http://www.thisismoney.co.uk/money/bills/article-2149796/Can-shoppers-really-save-32-fruit--veg-shunning-supermarkets-street-markets.html Poulter, S, 2012., Fruit and veg prices have soared by more than half in just one year... and the pain isn't over, Mail Online, Retreived from http://www.dailymail.co.uk/news/article-2215892/Fruit-veg-prices-soared-half-just-year--pain-isnt-over.html Rushton, A and Walker, S., 2007, International Logistics And Supply Chain Outsourcing: From Local to Global, Kogan Page Publishers Skills for Logistics, 2013, FTA Every woman in Transport and Logistics award, Skills for Logistics, Retrieved from http://www.skillsforlogistics.org/?entryid4=344432 Voortman, C., 2004, Global Logistics: Management, Juta and Company Ltd Read More