Fra Pas Frozen Yoghurt Shop Report

This report analyzes the business strategy of Fra Pas Frozen Yoghurt Shop, a partnership firm, using Porter's Five Forces model and PESTLE analysis. It examines the competitive landscape, identifies key macro-environmental factors, and provides recommendations for improving the business's profitability and sustainability.

Fra Pas Frozen Yoghurt Shop

EXECUTIVE SUMMARY
This report is based on case study of two partners opening a partnership firm as Fra-pas
Frozen Yoghurt shop. This report helps in analysing competitive analysis of a particular market
and also the environmental factors that may affect them to a great extent. Further
recommendations has also been provided to overcome such factors in easy and smooth way.

Table of Contents
EXECUTIVE SUMMARY.............................................................................................................2
INTRODUCTION ..........................................................................................................................2
1. Partnership as a business type..................................................................................................3
82. Using Porters 5 forces to analyse Fra-Pas Yoghurt business.................................................3
3. Discussing Three Macro environmental factors with reference of improving Frozen Yoghurt
business........................................................................................................................................5
CONCLUSION................................................................................................................................7
RECOMMENDATIONS.................................................................................................................7
REFERENCES................................................................................................................................7

INTRODUCTION
Business organisation is defined as an entity that aims in carrying out commercial
enterprise in terms of providing goods and services so that they can meet needs of customers.
The term partnership is defined as a business type where two or more parties work together
towards achieving common goals (Chambers and Hall, 2014). Thus, in this report Fra-Pas has
been taken into consideration. It is a type of ice-cream parlour shop and is specialised in order to
sell frozen yoghurt. The location of a shop is in busy Bullring cebtre which is a very large and
huge shopping centre that has been located at Brimingham city centre. There are many shops but
none of them sell frozen yoghurt. In the following report, competitive advantage of the business
has been discussed. In addition to this, this report also highlights on macro environmental factors
that affect business.
1. Partnership as a business type.
Partnership is a formal arrangement where two or more parties cooperate in order to manage and
operate a particular business (El-Masri, Orozco, Tarhini and Tarhini, 2015). Various partnership
arrangements are therefore possible in which all partners might share liabilities and also all the
profits in equal ratio. there are many advantages and disadvantages in order o work in a
partnership as follows-
Advantages
 Partnerships are the easiest one rather than companies in order to set up a business.
 Partnerships also helps in combining the resources and also expertise of number of
people.
Disadvantages
 Tax is charged at personal tax rate. It increases as per the earnings of the business.
 Personal difference may interfere with business.
Sole trader-
Sole trader is one of the independent owner of a particular business. They have all rights
and also responsibilities of business either in terms of profit or loss.
Advantages
 They have complete control over daily and also strategic decision making.
 They have lack of staff that can manage business.

Disadvantages
 They have unlimited number of liability for debts.
 All decisions in terms of business depends on self. It is difficult in bidding and accepting larger contracts.
Limited liability company
It is a form ODF private limited company that combines and passes through taxation of
partnership or also sole proprietorship.
Advantages
 They have protected assets.
 Creditors may not pursue the personal assets of owners in order to pay business debts.
Disadvantages
 It is little more expensive to operate rather than sole proprietorship
 A limited liability company may have to pay unemployment compensation for them.
Partnership firm is best to operate as they have equal amount of risk as well as of profit.
82. Using Porters 5 forces to analyse Fra-Pas Yoghurt business.
Mini-intro Fra-pa's Frozen Yoghurt shop is a type of ice cream parlour that has been
established by Frank Jones and Paddy Jackson as a partnership (Buckley, Burton. and
Mirza eds., 2016). Thus, the competitive advantage of this is been analysed with help of
Porters five forces model as per the below context-
Porters Five forces model is that tool or framework that helps in analysing the competition in
terms of business. It is an important tool that helps in understanding the forces that shapes
competition within a particular industry.
Threat of new entrants- the industries that are much profitable that yields high amount
of return will attract new firms towards them. Fra pas frozen yoghurt will result in decrease in
profits of many other firms that are available in industry. It acts as a threat unless the new firm
entry can be made more difficult with incumbents, abnormal profitability that may fall towards
zero. It is the minimal level of profitability that is required in order to keep an industry into
business. There are many factors that causes threat in high level that includes the following-
 Capital amount is low that is required in order to enter a market.
 Lack of customer loyalty base.
 Products are identical nearly.

 Switching cost of customer is low.
Threat of substitutes- A substitute is one that tries to solve same need of economy by
using different technologies. This force is act as threatening when buyers can easily find the
products of substitute in very reasonable price that is attractive for customers or in terms of
quality that is better from competitors. It is also termed as threatening when buyers of Fra-Pa's
easily switch their product in limited or low cost to other. It also referred to as the likelihood of
customers in order to find different way of doing that is done by Fra-pa's. Thus, substitution that
is cheap and easy to find may weaken the position of the cited company and threaten
profitability.
Bargaining power of customers- Customers have extreme power in order to demand for
products with lower price and higher in quality by Fra-pa's (Dijkman, Sprenkels, Peeters and
Janssen, 2015). This is possible when the bargaining power of customer is strong. Thus, lower
price results in limited revenue because to produce the high quality product, the production cost
rises that leads to lack of profit. The bargaining power is strong due to following factors as-
 To buy in large quantity or control many access points.
 The number of buyers that exist are few.
 Switching cost is low to other suppliers.
 Number of substitutes available are high.
Bargaining power of suppliers- This may affect directly to profit of firms because it has
to pay more in terms of materials. The bargaining power of supplier becomes strong due to
following factors-
 The number of suppliers are low in comparison to buyers.
 Substitution of raw materials are few in existence.
 The resource that are hold by suppliers are scarce.
 High cost in terms of switching raw materials.
Industry rivalry- this gorce act as the major determinant on the competitiveness and
profitability of an industry. In the industry having maximum competition, Fra-pa's have to
compete in aggressive manner for gaining high market share that results in low amount of
profits. The rivalry among competitors occurs mainly due to following factors as are-
 The number of competitors available in industry are high.
 Barriers in terms of exit are also high.

 The growth of industry is slow and negative.
 Products can be substituted easily and cannot be differentiated.
 There are equal size of competitors available in market industry.
 Lack of customer loyalty base.
Thus, from this, it can be analysed that the cited company or partnership Firm Fra-Pa's has to
face many problems in order to become stable in competitive market.
3. Discussing Three Macro environmental factors with reference of improving Frozen Yoghurt
business.
The macro environmental factors that may affect business to large extent has been described as
per below context with the help of PESTLE analysis (Adnyana, Anwar, Soemitro and Utomo,
2015). This is a tool or framework that is used by marketer in order to analyse and to monitor the
macro environmental factors that affect Fra-pas enterprise to a great extent.
 Economic factor- Economic factor has significant impact on business and also on
profits. This facto includes growth of economic, interest rates, exchange rates,
inflation, and disposal income of consumers and also the Fra-Pa’s business. It
would also affect the purchasing power of consumers. This factor also account for
foreign direct investment that depends on certain that are undergoing this analysis
in specific manner. The cited partnership firm of both the partners is facing with
strong sales revenue. They are going to finance further 20,000 Euros in the business
loan form from a bank. In addition to this, economic factor has a great impact on
the selected enterprise.
 Social factor- This factor scrutinize social environment of the market. This includes
cultural trends, demographics, and population analytics. It also includes taste,
preferences and demands of the society in terms of a particular product. Further,
there has extreme change in the society. Nowadays people have become more
health conscious. So the cited enterprise has to fulfil the requirements according to
the demand of the customers. This will help them in attracting large number of
customers towards the brand and may lead in achieving long term profitability.
They have to offer healthy and high quality product at lower price because most of
the customers of Fra-pas are teenagers and young adults that visists this shop in
order to meet their friends.

 Technological factors- The trend of technology also has great impact on business
(Wassmer, Pain and Paquin., 2017). If the shop wants to attract the potential
customers towards them, advancement in technology plays important role. Thus,
technology helps in improving the operations and also reaching the people easily.
The cited shop Fra-Pas has not even advertised or used promotional literature. If
they have used technology in terms of advertisement and promotion of their
product will help them in achieving long term success by attracting large number of
customers towards the brand. In addition to this, technology also plays essential
role in terms of online shopping as people are nowadays very much attracted
towards internet. Therefore, it becomes important for the cited store to update their
websites by adding some attractive features.
CONCLUSION
From the above report it has been concluded that Fra-Pa’s is a partnership firm. Thus, it
has also been analysed that both the partners plays significant role in order to achieve high
volume of profits by offering high quality products at lower price. Further, Porter’s Five forces
model has also been used in order to analyse the competitive advantage. In addition to this,
Pestle analysis is done to find the external environment that affects the business to large extent.
RECOMMENDATIONS
 They must go through training programs in order to enhance awareness.
 They must also develop industry specific services as per the variation in needs.
 They must also select place that may be effective for them.
 They must identify strengths and weakness of the firm and accordingly manage situations
so that they can earn huge amount of profit.

REFERENCES
Books and Journal
Chambers, C. and Hall, W.T., 2014. Partnership business items. AGENDA, 13.
El-Masri, M., Orozco, J., Tarhini, A. and Tarhini, T., 2015, July. The Impact of IS-Business
Alignment Practices on Organizational Choice of IS-Business Alignment Strategies.
In PACIS (p. 215).
Buckley, P.J., Burton, F. and Mirza, H. eds., 2016. The strategy and organization of
international business. Springer.
Dijkman, R.M., Sprenkels, B., Peeters, T. and Janssen, A., 2015. Business models for the
Internet of Things. International Journal of Information Management. 35(6). pp.672-678.
Wassmer, U., Pain, G. and Paquin, R.L., 2017. Taking environmental partnerships
seriously. Business Horizons. 60(1). pp.135-142.
Adnyana, I.B.P., Anwar, N., Soemitro, R.A. and Utomo, C., 2015. Critical Success Factors of
Public-Private-Community Partnership in Bali Tourism Infrastructure
Development. Journal of Sustainable Development. 8(6). p.208.