The Success Story of the Bakery Fiesta - Designer Cakes in Piatas - Case Study Example

? Interview of Entrepreneur AFFILIATION: Contents EXECUTIVE SUMMARY 3 INTRODUCTION AND HISTORY 3 ANALYSIS OF ENTREPRENEURIAL CHARACTERISTICS 4 BUSINESS ANALYSIS 6 BUSINESS STRATEGY ANALYSIS 7 SUGGESTIONS AND LEARNING 9 REFERENCES 11 APPENDIX 13 EXECUTIVE SUMMARY The report is an analysis of an interview taken of an entrepreneur running a sole proprietor business in Lahore, Pakistan. The interview is all about the entrepreneurial career and inspirations, how she came about becoming an entrepreneur and how has it turned out for her. Throughout the report, the analysis is stated along with the entrepreneur's responses, helping me to evaluate the success, the challenges and learning for myself and other future aspiring entrepreneurs. It integrates a comparison of my theoretical learning about entrepreneurship and the practical application of the theory in the business world. The reports reflects upon how entrepreneurs face failure initially and then they become successful. INTRODUCTION AND HISTORY The entrepreneur I interviewed is a young cook, who has opened up her own business of made-to-order fancy cakes and pastries. At the age of 23 years, Maham Baber began her business inspired by a few fancy birthday cakes she observed. Being a food fanatic and her passion for cooking and baking, she decided to open up a small business of made-to-order fancy home sweets of all kinds. Before opening her new business she took a few essential basic baking courses of professional baking. Based in her home town of Lahore, Pakistan, her business has flourished immensely over the past two years of the company's existence. The name of her bakery is Fiesta: Designer Cakes n Pinatas. Currently she works solo in the preparation of ordered sweets. The product offering includes designer cakes, desserts and pinatas. Each of these categories are available in numerous flavours. Cakes are custom made mainly fondant cakes with designs according to the customers' requirements. Desserts include all kinds of sweets like cupcakes, brownies, eclairs, macaroons, fruit and carrot cakes, moose, caramel crunch and tiramisu. Recently Fiesta has introduced a new variant to the business named Oh Ohs, which are chocolate coated cream filled rolls. The company takes orders through a Facebook page. Since it’s a young organization, it does not have a proper website as yet. However, the company works professionally as the orders are taken a week earlier and delivered to customers on the deadline. Sometimes the orders are picked by customers themselves from the owner's residence. At the inception of the business, the entrepreneur had to face certain challenges. For the initial few months, her business was running at a loss since at the time the demand for such fancy products was minimal. The product used to prepare the cakes were expensive as at times imported products were used which are usually expensive. She practically created the demand for designer cakes and other such sweets which took her more than an year. Moreover, her only communication was through Facebook which meant initially she was unable to reach her potential customer base. Also, since she took only a few courses in the beginning before starting, she had some cake and sweet disasters in the beginning which increased her cost immensely. One other main challenge was to convince customers to try out her product. This required good marketing skills which she lacked and hence gaining loyal customers was an extremely difficult phase for the entrepreneur. ANALYSIS OF ENTREPRENEURIAL CHARACTERISTICS As an entrepreneur, there are numerous characteristics which she embodies in her work and these entrepreneurial characteristics are the key to her immense success in just two years of the business operations. However, her working solo on the orders hinders her way of developing some of the most essential entrepreneurial characteristics. Like every successful entrepreneur, Fiesta's owner loves her work. Her passion for baking is what led her to build the foundation of her business. She enjoys making customised cakes the most, which are the product category ordered the most by her customers. Her passion for her work is intense and has been unwavering since the inception of the business. Entrepreneurs need to be passionate and determined with their work regardless of the hurdles and failures they face in the beginning of the business (Lengh, 2003 and Iandoli et.al., 2007). Furthermore, planning is the root of the entire production process (Price, 2013 and Stephenson, 2013). Since these sweets, especially designer cakes, require planning and brainstorming for the fondant designs to be made, the chef needs to carefully plan out the production of the cake. Planning is essential for her since she has to complete the orders before time and manage her personal life with it as well, since she is a student. She is a confident girl and possesses good communication skills, considering these two qualities/attributes are necessary for an entrepreneur (Miner, 1996 and Hall, 2012).. Also, since she is the one who communicates with the customers and take their orders, therefore, these two characteristics are extremely crucial for her. What further makes her a successful entrepreneur is her ability to understand and know her customers, what they want and how to execute the production process to bring out a product exactly according to customers' preferences. Her business is all about customers, which is crucial since her products are custom-made according to what customers want. She has developed a competitive edge over other cake designing companies, which is low price and higher sweet variety for customers. Her creativity is immense which could be seen from her work on her Facebook page. Lastly she invests in herself continuously by taking professional baking courses time to time as she wants to become an expert. Recently she took a course from Wilton Cake Decoration Course from U.S.A. Risk taking is another attribute that the entrepreneur possesses. She took the risk of opening a business of a product which was not in demand two years back. Taking that risk did cost her as she failed to pull off the business successfully in the first year, due to higher costs, low demand and certain expertise and financial issues. She handled these challenges smartly and thus emerged with huge success. Now her business is soaring in profits. The attributes she does not possess among the total set for successful entrepreneurs are designing her workplace since her workplace is her home. Also she needs to build up a team as being a team player she does not have a team yet to delegate certain tasks. She possesses most of the entrepreneurial attributes that we have learnt in this course except the few mentioned above. BUSINESS ANALYSIS Initially when Fiesta came into existence, the business was a unique business since back then customised cakes were not much common and people used to go for normal cakes and sweets at the time. Yet with time, more and more competitors have entered this new found business sector and the business has lost its uniqueness. This is the current challenge which Fiesta is facing and is in fact handling it quite well with its upcoming new innovations and its competitive advantage of low priced high quality products. The initial financial and market challenges faced by the company were overcome by its innovation and efforts which increased the demand for its products. Initial failure due to lack of demand and high costs helped the business learn how to capture the market by its innovative and presentable products. Considering our entrepreneurial studies, this small business can be called a typical business venture. This is because we are looking at a made-to-order food service company, which is similar to the restaurants' service. However, the business could be called unusual and not a typical business venture in the sense that customised cake and sweets bakeries are a new kind of business venture whose trend has only recently increased in Pakistan. Even in certain cities of Pakistan like the capital city Islamabad, these services are nowhere to be seen. The trend for such a business has emerged/originated from Lahore and up till now has spread in the city Karachi. The business comes under the category of Food and beverages, yet even under this category, this new kind of business is a new sub-category introduced only recently (Entrepreneur.com, 2013; Ahmed, 2010). So, we can say that it is not a typical small business that we studied in our entrepreneurship class, though the business falls in the already created business category of food and beverages. BUSINESS STRATEGY ANALYSIS Currently, Fiesta is just based in the city of Lahore. However, the owner has stated in her interview that she plans to expand the business further. She is firstly planning to open up a bakery and move forward to an official professional location for her business which she does not have right now. Also, she is planning to expand her product offerings even further. Her current professional course with Wilton has allowed her to expand her skill set in the field and will help her in expanding her product offering. In the near future she plans to start working on customised wedding cakes. Currently the business is running on low priced competitive pricing strategy. Although this strategy cost the company losses initially when the business started, yet this strategy now gives Fiesta an edge over other competitors since customised cakes and desserts have high costs of production (Zahorsky, 2013). The marketing strategy being used is niche market strategy, since the customised cakes and desserts are expensive and often preferred by upper and middle class. Moreover, the one marketing tool used by the company is word of mouth and social media marketing (Shimp, 2010). Initially the company had to create its word of mouth and thus at the inception of the business, it only made use of social media marketing to increase its products awareness in the market. This meant higher initial costs and lower revenues since fancy cakes were not a trend at that time. The company gradually has been able to develop a positive word of mouth by providing good quality food and service and markets its services through a Facebook page. Word of mouth can prove to be an effective tool if used properly (Valos, Powell, and Ewing, 2010). The company further plans to implement a product expansion strategy in the future by diversifying the product category of customised cakes. Previously the company produced customised birthday cakes, bridal shower, baby shower and occasions like Eid and Christmas etc. Now the company aims to introduce customised wedding cakes. Also the company is expanding its desserts category by introducing a new product Oh Ohs. Also the company makes use of innovation strategy since the competition in this business sector is increasing gradually due to increased demand for the customised cakes and sweets (OECD, 2007). Previously for the company, the fondant cakes (customised cakes) category has worked well and thus Fiesta will be concentrating on expanding this product category in the future. SUGGESTIONS AND LEARNING Through her 2 years experience of entrepreneurship, Maham has learnt that handling a business alone is a tough task, which requires assistance from other people in one way or another. For this purpose, she plans to employ workforce in the future as she will be opening up a bakery in future. This would require finances which she is planning to acquire through a loan. For being a successful entrepreneur according to her, it is important that a person pursues a business in a field for which they are passionate. It is important to enjoy the work they do and love the work, since extreme dedication is very important for an entrepreneur to work at their best consistently. The one thing that she would want to do differently if given a chance to start over again is take complete baking courses before starting the venture and then begin her business, since courses polish a person's already existing skills. Moreover, this could have helped her master her professional skills and thus begin the business in a more professional way than she originally did. According to her more and more people should pursue entrepreneurship in their areas of interest since Pakistan currently needs young entrepreneurs. Moreover, since the country's economic position is adversely deteriorating, entrepreneurs could help in some way to develop and improve its economic situation. The initial challenges which she faced in the first year of the business made her see how tough she would have to be. Managing a business whose products’ demand was low at the time of its inception made her see the risk she had taken. Yet it helped her learn how to tactfully handle that risk. She invested in herself by taking more professional courses. She delivered a high quality service and product to the few customers she had at the time, and never stopped trying. This dedication and ambition helped her provide a consistently high quality product which eventually paid off as gradually her business earned a favourable word of mouth and her business grew. I have learnt that entrepreneurship is all about self-confidence, perseverance, dedication, love for the business they pursue and extreme professionalism. For an entrepreneur to be successful, it is important that he/she loves his/her business, is confident, decisive and passionate about his/her work. Seeing that Maham never gave up on her dream even when initially her business went down with losses, it helped me learn that perseverance is a stepping stone for an entrepreneur. Her courage, confidence and hope that she will be successful as an entrepreneur one day made me see what a true entrepreneur is like. Being an entrepreneur is a whole new dimension which includes a wide range of qualities and attributes to be present in a human being. Running a business is not an easy task. It is filled with risks, challenges and responsibility. This interview assisted me in learning that a true entrepreneur is one who is possessed a visionary approach, never gives up on his/her goal, is a risk taker and is of a strong character who knows he/she can face multiple unpredictable situations and yet he/she is not afraid to face them. So, an entrepreneur is not just a person with a vision, he/she is much more than the attributes personified by our young entrepreneur here. REFERENCES Ahmad, H.M., 2010. Personality Traits among Entrepreneurial and Professional CEOs in SMEs. International Journal of Business and Management, 5(9), p.203-213.  Entrepreneur.com., 2013. 100 Brilliant Companies. Retrieved 14th October, 2013, from http://www.entrepreneur.com/page/223620. Hall, J. (2012). Top Characteristics Of Successful Entrepreneurs: Larry Levy, Kellogg School of Management, Weighs In. Retrieved 14th October, 2013, from http://www.forbes.com/sites/alanhall/2012/10/24/top-characteristics-of-successful-entrepreneurs-larry-levy-kellog-school-of-management-weighs-in/. Iandoli, L., Landstrom, H. & Raffa, M. (2007). Entrepreneurship, Competitiveness and Local Development: Frontiers in European Entrepreneurship Research. Edward, Elgar Publishing Inc., UK. Shimp, T.A., 2010. Integrated marketing communications in Advertising and Promotion. 8th ed. United Kingdom: South-Western Cengage Learning. Lengh, R.G. (2003). A Comparative Study of the Entrepreneurial Characteristics and Orientation of K--8 Public, Charter, and For-profit Schools. Cardinal Stritch University, U.S.A. Miner, J.B. (1996). The 4 Routes to Entrepreneurial Success. Berrett-Koehler Publishers Inc., U.S.A. OECD. (2007). Innovation and Growth: Rationale for an Innovation Strategy. Retrieved 14th October, 2013, from http://www.oecd.org/science/inno/39374789.pdf. Price, J. (2013). 10 Personality Traits Every Successful Entrepreneur Has. Ross School of Business, University of Michigan. Stephenson, J. (2013). 25 Common Characteristics of Successful Entrepreneurs. Retrieved 14th October, 2013, from http://www.entrepreneur.com/article/200730. Zahorsky, D. (2013). Pricing Strategies for Small Businesses. Retrieved 14th October, 2013, from http://sbinformation.about.com/cs/bestpractices/a/aa112402a.htm. Valos, M.J., Powell, I.H. & Ewing, M.T., 2010. Practitioner prognostications on the future of online marketing. Journal of Marketing Management, 26(3-4), p.361-376. APPENDIX FIESTA: DESIGNER CAKES AND PINATAS FACEBOOK PAGE: https://www.facebook.com/pages/FieSta-Designer-Cakes-n-Pinatas/151162411622497. Interviewed: Maham Baber, CEO Fiesta: Designer Cakes and Pinatas. Read More