Entrepreneurship Development: Organic Bakery Business Model Analysis

This study material analyzes the business model of an organic bakery, including the customer value proposition, marketing plan, operational plan, and financial plan. It also discusses the future developments and opportunities for the bakery. Find more study material on entrepreneurship development at Desklib.

ENTREPRENEURSHIP
DEVELOPMENT

TABLE OF CONTENTS
PART A...........................................................................................................................................3
PART B...........................................................................................................................................3
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
BUSINESS OBJECTIVES...........................................................................................................3
CUSTOMER VALUE PROPOSITION CANVAS......................................................................4
LEAN BUSINESS MODEL CANVAS.........................................................................................5
DEVELOPMENT PLAN................................................................................................................7
Marketing plan...........................................................................................................................7
Operational plan........................................................................................................................8
Technical solution and information technology plan...........................................................8
Human resources and organisation plan..............................................................................9
Financial plan.............................................................................................................................9
FUTURE DEVELOPMENTS.....................................................................................................10
SUMMARY...................................................................................................................................10
REFERENCES............................................................................................................................11

PART A
(Covered in Presentation)
PART B
INTRODUCTION
Entrepreneurial development is a detailed procedure that involves working on any
innovative idea or thought and evolving it in such manner that it can be turned into a
comprehensive business idea (Piva, 2018). The entrepreneur development is an
essential aspect in the overall progression of the society and the infrastructure of any
economy towards innovation and advancement.
The current start- up that has been planned is the Organic Bakery i.e. supplying
the bakery products and delicacies that will be prepared in an organic manner. There
are not many healthy choices that are available in the bakery items such as cookie,
cakes, pastries, scones etc. These are all baked and cooked using lot of butter and
sugar ultimately increasing the overall calorie intake. The organic bakery will replace the
food items that are basically increasing fats and prepare these items using different
techniques which will taste only a little different but the calories will be reduced.
This report will present an elaborative analysis of the business model canvas and
the customer value proposition canvas illustrating all the key points of the new
entrepreneurial venture that has been set up and the different plans that are necessary
such as marketing plan, financial plan etc. will also be prepared for the Organic Bakery.
MAIN BODY
BUSINESS OBJECTIVES
The business objectives basically signify the aim with which the business has been
set up and the ultimate measures or objectives that are to be achieved by the business.
Every business has a certain set of objectives which they strive to achieve through their
operation (Wang, Thornhill and De Castro, 2017). The current business Organic Bakery
also has a certain set of objectives that have been formulated for the period of three
years. These can be illustrated as follows:
The profit of the bakery should reach up to £ 50 on every bakery item that is
being sold. Since the products will be organic, the prices will already be higher as
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compared to other bakeries in the market and hence the profit quota should slowly be
increased along with the increase in quantity as well.
The sales of the bakery should expand 10% in the first year, by 20% in the
second year and by 40% in the third year. The ultimate aim is to target as much of
customers as possible and make them aware of the innovative concept on which the
entire bakery is based. This will ultimately increase the sales of the bakery as well.
The profit margin of the company should also rise significantly in the three years
as this will be the key earnings of the owners of the bakery.
CUSTOMER VALUE PROPOSITION CANVAS
Figure 1 Value proposition canvas
(Source: How to really understand your customers with the value proposition canvas, 2016)
Organic bakery will have to first understand their customers so that there is going to be a
better decision making for the organization. The customers have a certain way of selecting their
products and services in the market so that there is going to be a better functioning. The
organization will have to increase the brand value for themselves in the market so that there is
going to be a better functioning. The products have to be designed and produced in the way the
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customers will like it otherwise the organization and the products will not be able to capture the
market effectively. There is a stand which the organization must create for themselves or the
customers standards must be met so that the organization will be able to operate effectively in the
market. The competition in the market is increasing which will have to be monitored and
analysed so that the decisions for the future can be taken effectively. There are a lot of ideas and
creativity which comes in the minds of the business but all are not practical and will not be able
to gain the attention of the customers on time. There have to be right employees which have to
be hired by the organization so that there would be a better operation which can take place. There
is a lot of pain when the customers do not get the right products and the satisfaction level is not
high in the company.
The competition in the market for the bakery field is also high which is why it is very
important for the organization to have unique products and services so that they can get in the
right customers which are going to help the bakery be able to get in higher sales and profitability.
Organic bakery is good because there are a lot of customers which are getting health conscious
which has to be maintained by the organization so that there would be a good functioning which
can take place (Tomar, 2016). There has to be a clear direction which needs to be maintained by
the organization so that there is going to be a good functioning. There is a value of pricing as
well which the organization will have to be monitored so that the customers are going to have a
better understanding. There are going to be a lot of problems which are going to raise in the
organization so that there are going to be a better functioning. The company will have to be
having a strong goal for themselves and this canvas can help organic bakery to be able to operate
effectively in the market. The taste of the products of the organization is going to be well
maintained and the organization is going to make the customers have better products and
services which are going to make the organization have higher brand recognition for a longer
functioning.
LEAN BUSINESS MODEL CANVAS
The business model canvas is basically a detailed document that contains
analysis and description of some of the key and important aspects of a business that
need to be necessarily implemented i.e. it basically helps in visualising the different
parties that act as building blocks for the businesses (König, Gudd and Baltes, 2017).
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The business model canvas items in context of Organic Bakery can be analysed
in following manner:
Value proposition: The key value proposition of the business is in the fact that the
bakery food items will be prepared in organic manner which will be healthier to consume
(Levine and Rubinstein, 2017). This is an innovative idea that will not affect the taste
buds of the customers and also take care of their calorie intake.
Key partners: The key partners would be the raw material suppliers for the bakery and
they will be providing the required materials based on a designated timeline. The
sponsors of the company would also constitute as key partners as they will be
responsible for the success of the bakery in initial phase. The local tie- ups with the
farmers etc. can also help in obtaining the necessary organic materials.
Key activities: The key activities is the production of the bakery items that taste similar
or even better than the normal bakery items except that fact that they are made in
organic manner (Balaban, Župljanin and Ivanović, 2016). The production, distribution
and selling of these items would be the key activity being performed.
Key resources: Key resources required are equipments, an appropriate location and
building, human resources and intellectual rights and lastly, the financial resources will
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also be necessary for the bakery to perform smoothly. The digital and technological
integration will be the key towards the success and hence a comprehensive core team
of employees will be required.
Customer relationships: Organic Bakery will develop loyal customer base by
customised selling where self – service options will be given to the visitors (Das, 2017).
The special items such as cakes, pastries, muffins, cookie etc. can be customised in
shape and size as per the wish of the customer so that excellent relationship can be
established.
Customer segments: The customer segments that are targeted are mainly health
conscious people who do not want to compromise on either taste or health. The main
customer segments would be segmented on the basis of their lifestyle and they will be
targeted exclusively.
Channels: Both online as well as offline channels will be used by the bakery where they
will have stores at proper locations attracting the customer and the online websites will
also be used to attract the key customers of the company. In this manner, the cost-
efficiency can also be introduced.
Cost structure: The major costs will be incurred in the equipments and the set up of
the business because the raw material cost for bakery items is not very extravagant
(Emuoghene and Okoye, 2017). The costing is expected to incur an initial amount of £
20,000 to set up the business properly and then gradually the follow up costs will
decline significantly.
Revenue streams: The major revenue earning will be from the offline and online sales
of the bakery items that have been manufactured or produced at the bakery and which
are ultimately served to the customers.
Therefore, in this manner the different components of the lean business model
canvas will be applicable for the Organic Bakery and its set up.
DEVELOPMENT PLAN
Marketing plan
The marketing of the bakery will be mainly done through a series of offline and
online promotional techniques being adopted. The bakery will adopt a variety of rigorous
offline campaigns where they will use the free sample distribution technique, discounts
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and offers at the initial level, use of attractive posters and billboards etc. so that people
can become aware of the new innovative business that is about to be launched ( Ha,
Chau and Hieu, 2016). The major marketing will however be done through online
mediums where making a presence amongst the youth which is the key targeted
customer segment because of their health consciousness and the need to eat right. The
social media platforms and the tools that it provides with the ease can be used to
systematically launch the brand and monitor the reach and influence that it has had over
the targeted customers. The marketing plan for the Organic Bakery can therefore be
executed in this manner.
Operational plan
The operational plan will basically signify what role will be performed by whom and
how will the overall role distribution be so that the bakery can be operated in a
systematic manner. The raw material will be obtained directly from the suppliers of the
company which will supply all the basic requirements such as flour, organic ingredients
that are necessary and other required items. Additionally, since the bakery will also be
giving the wholesale services, the bulk order will be transported through the van that the
bakery owns and since it is the beginning, staff will have to perform multiple roles in the
bakery (Peura, 2017). The delivery of the online products that are ordered and the
maintenance of all the stock etc. will be done in a systematic manner where at initial
level, the bakery can meet its order on its own and when it begins to grow then a
collaboration or partnership can be developed so that a wider area can be covered.
Therefore, in this manner the operational activities of the company will be implemented.
Technical solution and information technology plan
The technical team of the Organic Bakery comprises of 4 key people and they will
manage the online marketing activity of the business and the reach that they have,
monitor the website that they have developed for online ordering and also maintain the
social media activities of the company. There has been a separate amount of fund that
will be dedicated to the maintenance and the performance of the technological
equipments and software in particular because these are the key to the success of any
business today and these need to be implemented adequately and monitored closely as
well (Ács, Szerb and Autio, 2016). The bakery might seek the assistance of some
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experts as well such as website developers, maintaining of the website etc. where until
the staff becomes trained, these services can be obtained from secondary or external
sources. In this manner therefore, the technical solution of all the problems will be
achieved and the information technology plan will also be implemented in the bakery.
Human resources and organisation plan
Currently, the human resources are being employed in a limited manner in the
company where since the level of operation is also limited at present, the staff required
will also be limited. At present, there will be three major departments that will be working
in the bakery i.e. the finance/ accounting department, the sales and promotional activity
staff and the general maintenance and kitchen staff (Braver and Danneels, 2018). Since
the employee strength will also be limited to only 15 employees apart from owner at the
initial level, 3 of them will be in the finance team, 4 will be on the technological team
maintaining online platforms and channels, 3 will be working on traditional selling
methods, 2 employee and the owner will be on the self- serving/display/ order counter
and 3 will be responsible for general maintenance and the cooking and baking field.
When required, the assistance from the external experts can be taken by the bakery
and as the scale of operation will expand over the years, the quantum and department
of human resources will also increase in the bakery.
Financial plan
The financial plan for the bakery can be developed in following manner where the key
resources that will be required have been presented in the form of a budget:
Particulars Amount
Human resource £ 2000
Marketing and promotion £ 3000
Technological equipments £ 8000
Experts £ 2000
Raw materials £ 2000
Others £ 3000
Total £ 20000
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FUTURE DEVELOPMENTS
In future, there are various opportunities for development of the bakery further as
the basic concept on which the idea is based i.e. organic bakery items has immense
growth potential. The ayurveda and consumption of those goods which are more and
more nature oriented is slowly rising and this will continue to rise further until it becomes
a millennial trend (Sharma and et.al., 2017). The Organic Bakery can take advantage of
this situation by regularly adapting themselves with the changes that are necessary and
making their products healthier every day.
The consumers of this kind of goods will only see a rise in the future because of
the preference towards leading a healthy lifestyle and making good choices and the
tendency to go vegan, and adopt the cultures of the Indian lands where they prefer
consumption of plants which can give strong immunity to the body is increasing
(Blundel, Lockett and Wang, 2017). The number of nirvana clubs, yoga centres etc. are
a proof of the impact that Indian culture is having over the western culture.
Therefore, if the bakery continues to modify itself in this respect, they will be able to
achieve the ultimate success.
SUMMARY
The research conducted in the report above helps in concluding that the business opportunity
that has been identified in the form of the organic bakery items. The preparation of the customer
value proposition analysis and the business canvas model clearly indicated that the idea is a
feasible venture and can be easily implemented as a business collectively. The research also
concluded that how the different plans can be developed and executed for the business. Lastly,
the future trends and growth of this business was also analysed and presented collectively.
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REFERENCES
Books and Journals
Ács, Z.J., Szerb, L. and Autio, E., 2016. Global entrepreneurship and development
index 2015. Springer International Publishing.
Balaban, M., Župljanin, S. and Ivanović, P., 2016. Sources of Finance for
Entrepreneurship Development. Economic Analysis. 49(1-2). pp.48-58.
Blundel, R., Lockett, N., and Wang, C., 2017. Exploring entrepreneurship. Sage.chapter
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Braver, L. and Danneels, E., 2018. Propensities return us to the discovery-creation
debate about entrepreneurial opportunities. Academy of Management Review.
43(4). pp.812-815.
Das, K., 2017. Going through the new avenue of life: A study on factors working behind
entrepreneurship development through self-help group. In Women's
entrepreneurship and microfinance. (pp. 157-171). Springer, Singapore.
Emuoghene, O. and Okoye, E.I., 2017. Accounting for Sustainable Entrepreneurship
Development.
Ha, T.T., Chau, N.N. and Hieu, N.T., 2016. The impact of governance on
entrepreneurship development in ASEAN+ 1 Countries: Evidence from World
Bank Datasets. Modern Economy. 7(5). pp.515-525.
König, M., Gudd, G., and Baltes, G., 2017, June. Business model validity in early-stage
technology ventures' business plans testing agreement between text and
reality. In 2017 International Conference on Engineering, Technology and
Innovation (ICE/ITMC) (pp. 930-937). IEEE.
Levine, R. and Rubinstein, Y., 2017. Smart and illicit: who becomes an entrepreneur
and do they earn more?. The Quarterly Journal of Economics. 132(2). pp.963-
1018.
Peura, K., 2017. Exploring agency in entrepreneurship development-A narrative
approach.
Piva, E., 2018. Time allocation behaviours of entrepreneurs: the impact of individual
entrepreneurial orientation. Economia e Politica Industriale. 45(4). pp.493-518
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Sharma, V.K., and et.al., 2017. Impact assessment of training on farmer’s perception,
performance and entrepreneurship development. Maharashtra Journal of
Agricultural. Economics. 20(2). pp.154-156.
Tomar, T.S., 2016. Entrepreneurship development and innovation management: key
connections. In 4th International Conference on Innovation and
Entrepreneurship (pp. 263-271).
Wang, T., Thornhill, S., and De Castro, J. O., 2017. Entrepreneurial orientation,
legitimation, and new venture performance. Strategic Entrepreneurship
Journal. 11(4). 373-392.
Online
HOW TO REALLY UNDERSTAND YOUR CUSTOMER WITH THE VALUE
PROPOSITION CANVAS, 2016. [ONLINE]. AVAILABLE THROUGH: <
http://designabetterbusiness.com/2017/10/12/how-to-really-understand-your-
customer-with-the-value-proposition-canvas/ >.
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