Issues Confronted during the Start-Up of the Business, Economic and Social Impact of the Business - Case Study Example

Reflective Report By Introduction Entrepreneurship has become a major venture in the present economic times. Most peoplethat want to be their own bosses today have taken the path of entrepreneurship. This has different benefits for the entrepreneur and leads to employment opportunities for other people. Although entrepreneurship has become popular today, it is not a venture that any individual can get into and realize success. For an entrepreneur to be successful they should set themselves apart by possessing strong qualities and skills that will help tem attract success. Entrepreneurship is a journey, and each entrepreneur has a story to tell; of the start-up, the challenges, and the opportunities. From these stories, people interested in venturing into entrepreneurship might benefit a lot. This paper is a reflective report that reflects on an interview with an experienced entrepreneur, and points out the knowledge acquired that can be applied to an anticipated future entrepreneurial venture. Overview of the business My interviewee was Mr. Danny Grant, the CEO and founder of Tacos restaurant. This is a fast food restaurant, and has been operational for the past two years, starting mid-2012. Being new in the fast food industry, Tacos restaurant aims at beating competition by providing foods with healthy ingredients and lower price. This is based on small scale, and currently has no other similar outlets. The types of food that this restaurant serves include burgers, different fruit and vegetable salads, fruits, sausages, fries, a variety of soft drinks, pizza, chicken, sandwiches, and pies, among others. The restaurant offers deliveries to homes, offices, and sometimes schools. The staff members of this restaurant include the CEO, one human resources manager, one marketing manager, one chef, and cooking experts. Others include a receptionist, security guards, and cleaners of the restaurant. How they came to start the business Mr. Grant was resourceful during the interview, as he shared some important insights into his fast food business. First, Mr. Grant pointed out that since his early years in business school, he dreamt of being an entrepreneur. However, he planned to become formally employed in order to raise capital for his business, as well as gain considerable experience in entrepreneurship. After college completion, Mr. Grant started to search for formal employment. However, things did not go as he had anticipated. After about five months after college graduation, Mr. Grant was still jobless. This joblessness then became a source of inspiration for Mr. Grant to pursue his dream of entrepreneurship. However, capital became his major challenge. The family of Mr. Grant was supportive, and they agreed to provide him with capital to start his business. This is then how Mr. Grant ventured into the business of fast food. Background of the Business Tacos restaurant was officially launched mid-2012, the month of July, to be precise. This is a medium sized restaurant. The business is yet to expand to a chain of restaurants. In this case, Mr. Grant has not opened other restaurants in different locations. However, plans are underway to expand, beginning early 2015. Mr. Grant admitted to be in the process of strategizing how to roll out the expansion plan. Nonetheless, the expansion of this business has taken quite long, according to Mr. Grant, due to the major fact that he wants to establish medium-size, and not small restaurants. In addition, quality is a priority for Mr. Grant. This therefore, calls for an increased budget and strategy setting. Issues that were confronted during the start-up of the business During the interview process, Mr. Grant admitted that it was quite challenging to set up the business. This was especially at the start-up period of the business. Therefore, the entrepreneur faced a multitude of challenges. His commitment to the business goals and objectives is what ensured that the business picked up and became successful. A major issue that confronted Mr. Grant during the start-up period of the business is lack of experience. As seen, Mr. Grant ventured into entrepreneurship, even though he did not have any hands-on experience in entrepreneurship, except for his theoretical business knowledge he acquired back in business school. This way, Mr. Grant was doubtful of some of the major decisions he made at the start. However, consultations with other experienced entrepreneurs were resourceful to him, and enabled him make effective decisions in his business. A second major issue in the initial stage of the business was capital. As seen, Mr. Grant did not have capital of his own to start up the business. However, he managed to raise capital through family contribution, and this had to be refunded within a stipulated period of time. For this reason therefore, Mr. Grant started low. He rented a small space, where he set up his business. He also hired two people with experience in fast food industry, specifically in the culinary field. Together with these two, Mr. Grant ensured that the small restaurant was operational. They cleaned the restaurant, prepared food, and billed, among other tasks. However, this was quite manageable as the restaurant was small. The business at the start-up period relied heavily on the profits in order to make any developments. For this reason, it was quite impossible to save money, which the business would use in future. Profits were therefore, used to pay debts and purchase kitchen equipment. When the business picked up, Mr. Grant rented a bigger space. Therefore, profits were used on rent, hiring new employees, and increasing the food supplies, as customers had increased as well. Another issue that affected this business during the start-up period is demotivation of employees. Initially, the business had two employees before employing an additional five employees after expansion. However, due to financial challenges at the start, the CEO did not afford to pay employees an attractive salary. In addition, the pay of employees was delayed in some months. For this reason, most employees were demotivated. One employee opted out of the job, while some started to report late to work and exhibiting decreased productivity in their work. This therefore, had a detrimental effect on the productivity of the business. However, upon addressing this issue, the productivity of the business was restored to normal. How they assess both the economic and social impact of their business Mr. Grant believes that his business influences the surrounding community in different ways. This includes socially and economically. According to Grant, the business has made positive social impact in the surrounding community. For instance, this has strengthened the social ties of people in the around. Most of the time, different people come to meet other people in the restaurant, and in the process order for food. In addition, during weekends in the afternoons, most parents bring their children to the restaurant, where they enjoy family times and food served by the restaurant. This therefore, serves to strengthen family and friendship bonds of people in the area. The business also has had positive economic influence in the surrounding community. In the area, there are only a few eateries. However, comparing the prices of food in these restaurants shows that the Tacos restaurant offers the cheapest food prices to customers. This is one of the major reasons that the restaurant receives many customers, as compared to the other restaurants. Mr. Grant therefore, feels that the restaurant considers the economic needs of its customers. This way, it saves customers their money, thus reducing the amount of money they spend on expenses that are related to food. Skills Needed for Successful Entrepreneurship This interview has instilled great knowledge in me regarding entrepreneurship. This knowledge is important for me, as I will apply in my future entrepreneurship in the food industry. I have been able to learn the process of entrepreneurship, challenges in entrepreneurship, and how to overcome those challenges. Furthermore, I have learnt how as an individual, I can transform my ideas into products and services. Before carrying out this interview with Mr. Grant, I held the popular belief that once one had capital and a perceived effective business plan, the person was likely to succeed in entrepreneurship or whatever business they plan to venture in. However, at the moment, I have changed this perception, based on the experiences of Mr. Grant in entrepreneurship. Apart from having the capital, it is important that an entrepreneur prepares a business plan. However, a business plan is not a guarantee for success in the business. Therefore, I consider it important for an individual to also prepare a feasibility study of the business. All these are vital tools for the success of a business. Therefore, for successful entrepreneurship, an individual should have knowledge and be skilled in feasibility planning and business planning. Through this interview with Mr. Grant, I have also realized that it is quite impossible for any entrepreneur to thrive without the skill of time management. Although Mr. Grant started his business with considerable challenges, he was able to grasp and utilize his time management skills, which contributed to the success of the business. For instance, Mr. Grant devoted all his time to his business. According to Plaskett (2009), for an entrepreneur to realize success in their business, they must devote time to the business. Therefore, the fact that Mr. Grant was there all the time for his business, working together with his employees contributed immensely to the growth of the business. I have identified planning to be an important skill in entrepreneurship. According to Longenecker et al (2013), all entrepreneurs need to know how to plan for their business. I consider this to be a major lesson to Mr. Grant and me as well. When starting the business, Mr. Grant did not have an effective plan. If only he could have taken time to plan well before launching his business, he would have avoided most of the challenges that he faced at the start of the business. For this reason therefore, any upcoming entrepreneur should be able to plan for their business in order for the business to be successful. Entrepreneurs should also embrace the value of patience. This together with other skills will contribute to the success of the business. Judging from the interview, Mr. Grant portrayed a high level of patience. Although his business experienced a multitude of challenges at the beginning, Mr. Grant was patient, and worked with patience towards addressing the challenges. Therefore, as Nieuwenhuizen (2008) argues, anyone that gives up easily might not succeed in entrepreneurship. This is mainly because entrepreneurship involves many challenges and decisions to make, thus giving up will mean failure on the side of the entrepreneur. From the interview, I realize that it is imperative for any entrepreneur or aspiring entrepreneur to have good communication skills. Without communication skills, it is impossible for anyone to succeed as an entrepreneur (Nieuwenhuizen 2008). In the case of Mr. Grant, he exhibited great communication skills, and this is one of the reasons his business was able to weather the storms it faced. First, from the interview, it is clear that Mr. Grant had a network of other successful entrepreneurs with whom he interacted. When Mr. Grant set up his business, he lacked hands on experience in entrepreneurship. However, through consultations with his network of entrepreneurs, Mr. Grant was able to make significant progress in his business. Mr. Grant also exhibited good communication skills with his employees. Although the business had a challenging start-up, Mr. Grant was able to retain most of his employees at this challenging moment. Therefore, the way he communicated with the employees made them to remain committed to the business. Mr. Grant also established a positive relationship with his suppliers. This is mainly attributed to his communication skills. He has maintained the same suppliers since he set up the business, and these have remained loyal to him. Good communication skills are therefore, critical in the realization of success by an entrepreneur. Starting a New Business Starting a new business is process that involves a series of steps. This I have learnt from the interview with Mr. Grant, as well as the class course. According to Sullivan (2000), the first step in starting a new business involves identifying an opportunity that would lead to the setting up of the business. In the case of Mr. Grant, he identified an opportunity out of a challenge, in this case joblessness. In addition, he decided to venture in fast food after carrying out a research in the surrounding area, and established that there were only countable fast food restaurants, which did not meet fully the needs of the people in the surrounding area. In this case, Mr. Grant realized a business opportunity. Therefore, in order to be an entrepreneur, one must have a business opportunity that they have identified, before implementing it. After the interview with Mr. Grant, I now understand that a successful entrepreneur must possess strong characteristics and perspectives. Although I might not want to turn out exactly like Mr. Grant, I have a desire to learn from his experience as an entrepreneur. Clearly, Mr. Grant took a risk when he ventured into entrepreneurship. He had other options to choose from, but instead chose entrepreneurship. Personally, I have been in many situations that have required me to make a choice out of the many options that were available. However, sometimes I lack confidence that is enough to take a risk or a chance. For this reason, I feel I have lost many opportunities related to the pursuance of my dreams. This interview was therefore, insightful, as I could relate and apply the lessons learned from the experiences of Mr. Grant to different aspects of my personal and professional life, apart from the aspect of business or entrepreneurship. It is important for a person to be confident enough to take risks in entrepreneurship or other aspects of life (Sullivan 2000). Although Mr. Grant was uncertain of his predicament in entrepreneurship, he forged ahead and here he is today, a successful entrepreneur. After identifying an opportunity, an entrepreneur should proceed to the stage of developing a vision for the desired business. Here, one is supposed to determine the business seeks to accomplish. In addition, an entrepreneur must set the goals of the planned business. In this case, an entrepreneur will determine the short term as well as the long term goals of the business (Moore 2008). These are important in ensuring that the business has a direction with regard to its vision. Therefore, if one has an idea about a business, they must know what they want to come out of the idea. In this case therefore, a vision and goals are some of the most important features that any business should possess in order for it to boom. Nonetheless, this is part of the business planning process. Securing finances is another key step when starting up a new business. Capital can be sourced from family, friends, credit or loans (Vance 2005). In this case, Mr Grant sourced from his family. Therefore, it does not matter where one sources for capital. However, it should be a reliable, legit, and inexpensive means (Vance 2005). After this, an entrepreneur should ensure to get business assistance and training. Mr. Grant made consultations with other entrepreneurs that were experienced in the field. In addition, Manjunath (2010), it is important for one to determine the structure of business, and learn about the legal steps involved in hiring a workforce. From the interview, it is quite evident that Mr. Grant went through these steps, which is why his business thrived despite the challenges at the initial stage. Addressing Challenges in a Business What the interview with Mr. Grant has taught me is that entrepreneurship is not without challenges. However, a good entrepreneur is capable of changing the challenges into opportunities. What is important is for the entrepreneur to strategize on how well to address a challenge, and go ahead and apply the strategy (Moore 2008). For instance, Mr. Grant experienced competition from the surrounding fast food restaurants as a major challenge. This had resulted in his restaurant not attracting many customers as compared to his competitors. However, after considerable research, Mr. Grant identified price to be the major source of the challenge. After adjusting his food prices and advertising them, the restaurant started to receive many customers, and in this case beat competition. Some challenges are more specific, depending on the nature of the business. A major challenge of the fast food industry that I learnt from the interview lies in their promotion of healthy foods and lifestyle. According to Floyd (2004), fast food is considered lethal to human health, especially in this century where awareness is made on obesity and other effects of fast food. However, in order to address this challenge, Mr. Grant introduced fruits, a range of salads, and other low fat options in the menu of his restaurant. This therefore, would also attract those customers that were keen on their health. With this, I realize that it is vital for an entrepreneur to address some challenges based on the nature of their business. Additionally, entrepreneurs should prioritize the needs of all customers, in this case, the need for healthier foods. According to Manjunath (2010), when customers are prioritized, they feel important, and the business will win their loyalty, thus increasing its productivity and profitability. Overall, when it comes to challenges in a business, it is important for an entrepreneur to be psychologically prepared to face challenges. However, a successful entrepreneur will exhibit patience, determination, and commitment. This way, the entrepreneur will not give up on the business when challenges abound. Instead, the entrepreneur will look for effective strategies to deal with the challenges. In most cases, challenges might open up more opportunities for an entrepreneur, if he or she addresses them effectively. Therefore, I realize that in entrepreneurship, the different challenges that are experienced should serve to strengthen the business and sharpen the skills of the entrepreneur. Conclusion This reflection report has presented an interview with one entrepreneur that runs a medium-sized fast food restaurant. Form the interview, I have identified the various lessons that I have learnt from the experience of the entrepreneur. On the other hand, I have also established how those lessons and key issues generate diverse knowledge that pertains to entrepreneurship. The major areas that have been addressed include skills needed for successful entrepreneurship, starting up a new business, and addressing challenges in a business. The knowledge on these areas is based on the experiences of the interviewee. Nonetheless, these are important to me, hence I can apply them in future when I venture into entrepreneurship. Overall, the interview was a great source of information and knowledge, and this has enlightened me on various aspects of entrepreneurship that are important in my academic as well as professional practice. Works Cited Floyd, C 2004, “The Great Fast Food Challenge,” Accessed 9 April 2014 < http://www.franchise-chat.com/resources/fast_food_challenge.htm > Longenecker, J., Petty, J., Palich, L. & Hoy, F 2013, “Small Business Management,” Cengage Learning, New York. Manjunath, V.S 2010, “Entrepreneurship & Management,” Pearson Education India, Mumbai. Moore, C 2008, “Managing Small Business: An Entrepreneurial Emphasis,” Cengage Learning, New York. Nieuwenhuizen, C 2008, “Entrepreneurial Skills,” Juta and Company Ltd, New York. Plaskett, Ralph, R. P 2009, “6 time management skills for entrepreneurs. Time is Currency for the True Entrepreneur,” Accessed 9 April, 2014 < http://christianpf.com/6-time-management-skills-for-entrepreneurs/> Sullivan, R 2000, “The Small Business Start-up Guide,” Information International, New York. Vance, D 2005, “Raising Capital,” Springer, London. Read More