Case Study of Flavourly: A Crowdfunded Gourmet Food Start-up

The assignment content consists of a collection of academic articles and online resources related to entrepreneurship, small and medium-sized enterprises (SMEs), and crowdfunding. The articles cover topics such as e-commerce adoption in SMEs, internationalization strategies for SMEs, entrepreneurial marketing, family businesses, risk-taking by youth, quality management, brand-building efforts, and financial structure in small business. Online resources include information about the startup Flavourly, which raised £300,000 through crowdfunding after turning down four investors on Dragons' Den.

Small Business
Enterprise

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
AC1.1 Brief profile......................................................................................................................3
AC1.2 Comparative Analysis......................................................................................................4
TASK 2............................................................................................................................................5
AC2.1 Justification and actions to overcome weaknesses...........................................................5
AC2.2 Methods for maintaining performance.............................................................................6
AC2.3 Areas of expansion...........................................................................................................6
TASK 3............................................................................................................................................7
AC3.1 Assessment on existing business objectives and plans....................................................7
AC3.2 Evaluation of business plan..............................................................................................8
AC3.3 Action Plan.......................................................................................................................9
TASK 4..........................................................................................................................................10
AC4.1 Impact of proposed changes...........................................................................................10
AC4.2 Plan for management of changes...................................................................................11
AC4.3 Improvements in performance ......................................................................................12
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................14
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INTRODUCTION
Businesses can be small, medium or large depending upon their financial structure and
capital investments. Small Business Enterprises are recognised as firms that are solely owned by
single or group of individuals with less number of employees and least capital investments.
These enterprises can be retail operations background or e-commerce businesses, etc. The young
and innovative ideas when nurtured with angel investors or great opportunities from the market
turn out to be small business enterprises. Dragons' Den is one such platform that gives
opportunities to budding entrepreneurs with one success story of Flavourly which is a one stop
destination for gourmet food, snacks and craft beer subscription through an online website. This
report aims to attain greater understandings for the small business enterprises with in depth
coverage of different aspects in such ventures.
TASK 1
AC1.1 Brief profile
Name of the Business: Flavourly.com
Owner: Ryan O' Rorke
Background/ History: The company was just an idea or thought in the mind of Ryan O' Rorke
its sole founder. Dragons' Den was the platform he explored for gathering investments by
displaying his idea of a online portal that will deliver food and craft beer door to door over a
monthly subscription. He gathered investments worth £75,000 for 5% share or equity but these
were declined and the company aspired crowdfunding from Crowdcube. This decision acquired
him great publicity as the company engaged almost four times larger investments through this
platform than Den's angel investors (Victor, 2015).
The company was launched in a garage in 2012 in Edinburgh which sold gourmet food,
snacks and craft beers to its subscribed customers every month. Flavourly became a link for the
small British producers who could not find huge audiences for their quality product. With about
500% growth every year the company now has established relations with over 500 lone
producers to sell their commodity in the name of Flavourly (Victor, A., 2015).
Activities: Sells snacks and gourmet food, craft beers in two variant packaging through online
subscription facility for every month. The company also launched a Flavourly craft beer club for
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its members to develop a social network and deeper connections with its customers (About.
2016).
Business Location: Edinburgh, UK
Strengths and Weaknesses:
Strengths: With unique idea and effortless implementation the company acquired good
reputation within 4 years of its launch. Unlike any other profit earning company, Flavourly did
not entertain super markets but collaborated with small scale producers that had high quality
products. Regular reviews and feedbacks are encouraged by the company for improving its
qualities and demands regarding the products and services.
Weaknesses: The company doesn't has any physical store or office other than its core
operational block. Although the variety of beer is rare and exclusive but it is a bit costlier than
the ones available at the supermarket. Another drawback for the company is lack of existence in
other parts of the continent.
AC1.2 Comparative Analysis
Flavourly had a fresh concept of delivering craft beers to the consumers in the region by
ordering on the website and that too with a subscription. This intends the consumers had all the
convenience with extravagant quality services. Beer52 is one of the prominent competitor for
Flavourly. Being in the same segment of small businesses and selling same commodity the
company faces tough competition. This company Beer52 provides beer bottles with a snack and
a magazine. Flavourly grew financially stronger as it already gathered enough publicity as well
as made headlines with its target achievement of crowdfunding up-to £3,00,000.
Customers were more attracted towards the concept of Flavourly than Beer52 because of
the following reasons:
1. Variety of options regarding the products. The latter company has more options for the
consumers regarding the type of craft beer that is light, mild or dark as well as the
flavours for the beer.
2. Flavourly gives price relaxation to the consumers hence, more people are attracted.
3. The company has been working with principles and ethics of not involving supermarkets
or big investors. This gave the small scale producers a great exposure through Flavourly.
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4. Flavourly sells those commodities that are not available in the supermarkets or any other
physical outlets which makes it unique by itself.
The company has been efficiently providing services from Edinburgh to several parts of
UK. With promotional offers and gifting option consumers are pampered in every possible way.
Financial performance was more strengthened with its innovative marketing strategies through
promotion on social networking portals and the company website also (Bridge and O'Neill,
2012). The financial growth is steadily increasing with the growing popularity of the brand.
Listing of the organisation on the top 100 list of start-ups in UK has increased its
financial resources and invited more crowdfunding in the past year.
TASK 2
AC2.1 Justification and actions to overcome weaknesses
The company has been functioning from past 4 years only in UK. Here, lies the
weakness. The organisation has to expand in other European as well as sub continental countries.
This feature is a weakness because being an e-commerce website the company had a very big
advantage of saving money needed for setting up a physical store. Physical stores require more
labour and capital with huge investments in collection of resources. Although the founder
members cleverly saved money and launched their idea; but since the start-up became successful
within such a short time span they must focus now on expanding their business (Freel, 2013).
Micro breweries are present in many parts of Europe. The headquarters are situated in
Edinburgh but there is no other physical office in the country. Hence, the company can build up
at least one more back office and also expand its warehouse. Expansion has its own benefits
(Blackburn, Hart and Wainwright, 2013). Being an e-commerce portal, the company doesn't need
any funds for setting up physical stores. The only tool required is complete market analysis of
the particular region where the expansion is planned. Ryan O' Rorke the director and founder of
the company must work out all the possibilities for developing its roots in other parts of the
continent.
The engrossment of micro brewers across Europe with Flavourly will improve the variety
of craft beers, consequently increasing the consumer belt. People love regular new options
(Ackermann and Audretsch, 2013). These can only be possible by exploring new areas.
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AC2.2 Methods for maintaining performance
Performance is a parameter that is made of different factors constituting a company or
organisation (Hilmersson, 2014). In order to maintain and strengthen the performance every
company must inculcate the following steps:
1. Knowing the current efficiency of the company. It is very important to get complete
information regarding the strengths and weakness of the company. If the core is not
strong enough then the supporting systems will also weaken with time.
2. Customer base data collection must be performed timely. From old to new to pursuing all
the customer information must be safeguarded. For Flavourly, this information is
necessary because the plans regarding new collection or customisation of old, customer
opinions are a must. These reviews help in making decisions regarding this factor.
3. Timing is second important factor that can either enhance performance or deteriorate
company standards. The decision takers must judge whether the current time is suitable
for business growth or not.
4. Existing performance standards can also be increased by getting more market share.
Flavourly has to keep on working for increasing its market share so that competitors do
not take advantage of such a situation.
5. Management of finances in the company is very essential. If finances are not regulated,
despite of earning profits the company would have less of income and more of
expenditure or and imbalance in the overall spending. Borrowing, cash flow, working
capital are such elements that have to be controlled for managing finance (Ritchie, 2015).
6. Goals and objectives are factors that make the company move on a particular path. With
exceptionally dynamic business environment, company's have to keep on devising new
work plans and evaluate these so that irrelevant activities are avoided.
AC2.3 Areas of expansion
Flavourly was established with the concept of providing craft beers to its consumers over
a monthly subscription for on door delivery. The company then expanded with the launch of
gourmet food products like snacks, jam, breads, etc. with the craft beers. Exclusive and rare
collection is the advantage of the company but there are chances and scope of expansion for the
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company. These new areas can be beverage sector with openings in vines or juices or a
completely new dimension that is goodies.
From teenagers to old people, everyone wants to grab a talk with a drink or a beverage.
Hence, this section is a never ending one. Flavourly targeted this need of the consumers and
proposed cheap and exclusive craft beers to be delivered tension free at the start of every month.
The company as has contacts with micro breweries and producers that cannot market themselves,
this edge can be utilised in introducing a completely different range of drinks that is juices and
vines. Vines can be a costlier input but juices can be both affordable and huge profit earning.
With an initiative to head the country towards health safety and nutritionally rich citizens, extra
ordinary juices can be encouraged. With knowledge and statistics of the current customer base
the company already has test audience for the launch of its product (Forsman and Temel, 2011).
Goodies are just like memoirs that people collect for remembrance and value of goods
(Jones and Rowley, 2011). If Flavourly offers consumers a new and exclusive range of goodies
like key-chains, mugs, beer glasses, hoodies, etc. with some interesting and trendy captions
printed on them, people will definitely be attracted. These kind of products are not at all provided
by other competitors and the buyer-seller relationship will become more valuable. Just as the
company is listed as #1 supplier of craft beer with price effectiveness, this image of the company
can help it acquire good audiences for the new products it has been proposing.
Some other strategies can also be proposed for expanding Flavourly. These strategies
include expansion of services in new lands, franchising the brand or creating patents and
licensing of the products. These will increase the company's popularity and further add up to the
brand reputation.
TASK 3
AC3.1 Assessment on existing business objectives and plans
Business Objective of Flavourly: To give great quality beer with exclusive and rare range
in flavours with affordable pricing and best in class experience for the consumers (FAQs. 2016).
It is quite astonishing for strategists to digest such an objective by a small business entrepreneur
that never had any experience in working of a business. But Ryan worked pretty well in
achieving its goals and objectives and made it to the list of top 100 start ups of UK. The
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objective of the company clearly states that it is customer oriented but on the same time it works
for the development of micro producers.
Business plan of the company is based on two basic principles. The authenticity of the
products will never be lost and consumer satisfaction is the main motive (Burns, 2010). By
authenticity the company meant originality and uniqueness. There are a lot of micro breweries
and small or micro scale producers of beer and food products. But these could not develop their
contacts with the supermarkets or even local retailers due to lack of resources and good pricing
standards. Ryan O' Rorke saw this as an opportunity for developing Flavourly. The company
made contacts with these producers and signed a pact to become a platform for these producers.
Originality and uniqueness came up as Flavourly had sole ownership. None of its products were
available in any of the supermarkets and retail stores. This enterprise also focused on complete
digitalisation. No physical outlets were developed and the complete trades were launched
through e-commerce website.
Hence, the business flourished due to no chance of imitation and curbing half the
competition by cheap pricing. The business plan was made up for acquiring a sustainable
competitive advantage which the company acquired within just two years of its establishment.
AC3.2 Evaluation of business plan
The business plan of a company is like a guideline that needs to be followed for
achieving the objective of the company. Complete working of the company depends on this
strategy. From production to marketing and sales the complete functioning of the organisation
depends on this business plan. With a ravishing business strategy the company Flavourly
flourished in the initial years of its launch but there is no such thing like perfection. Therefore,
the company has to work on the limiting areas so that any hindrance doesn't cause inconvenience
to the consumers. These aspects are discussed below:
1. The company must cooperate smoothly with breweries. Earning more name and profits
always invites greed for money. This can result in increasing supplier demands or
purchaser demands. The bargaining power of supplier can be controlled through proper
pricing policies and agreements.
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2. Rights are always an area that get threatened with competition. The use of patents or
copyrights over labels and particular flavours will help the company to retain competitors
from acquiring their rights.
3. Two important links in the online business are transaction mediums and delivery options.
With better logistics and more secure payment modes increase the trust of consumers in
the company.
4. Regularly refurbished stock is always appreciated. Since, the company has a small
warehouse it must work out options for managing its stock in such a way that in
situations of less demands stock is not outdated or expired.
5. Management of financial resources can be improved. Capital spending and profit earning
has to be managed with meeting requirements of staff and consumers. The finance
structure must be clearly defined (Van Der Wijst, 2012.).
With improvement in such areas the company can excel and emerge as a global brand in
the craft beer segment.
AC3.3 Action Plan
An action plan is based on several steps that need to be configured before preparation.
These include the determination of goals and objectives with assessment of rules and strategies
that have been implied for meeting these objectives (MacDonald and Coffield, 2015). Action
plan is step wise implementation of improved strategies in the company. The proposed action
plan for the company is :1. Scope of changes: Changes are always necessary for development of the company and
here a lot of scope is available for changes (Odoom, 2016).2. Creating vision: The complete financial and documentation work of the company has to
be changed. This includes making improvement in policies regarding purchase of
resources and developing better financial strategies for the company. Leaders have this
responsibility for delivering the objectives and goals to the team members who will be
working in implementation of this action plan.3. Driving commitment: Employees must be made aware about the necessary changes they
may face because sudden implementation without any proper orientation may cause
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disintegration of the company. The executives and employees efficient in designing legal
structure and the finance strategies must be given their part of the strategy.4. Establish change infrastructure: This section comprises of introducing the new tools and
techniques that have been designed for changing the prospective areas of the
infrastructure. It is very important that the people who will undergo the changes have to
be acquainted with all the ammunitions and necessary weapons (Murphy and Leonard,
2016).
5. Sustaining the change: the success of an action plan relies in its results and after-effects.
The progress of the company is not disturbed but in fact increased this means the changes
were seriously necessary and the company would have faced consequences if these were
not realised.
TASK 4
AC4.1 Impact of proposed changes
Change is a part of the organisation and it is also impacted in a positive manner so that
this will assist to manage their work in a appropriate manner (Ghobakhloo, Arias-Aranda and
Benitez-Amado, 2011). Here are some points that shows the impact of change. In addition to that
this will also assist to evaluate various changes in the workplace. Flavourly.com is also impacted
from the changes in a positive and negative manner.
Employee of the organisation faces various problem in which mental stress is one of
them. Some times when changes take place so that employee feel fear. A employee automatically
develop a strategy in which they focus on the time related issues and unfairness and many more
things that leads to mental stress in the personal and professional life.
In addition to that this will also leads to the lack of loyalty in which employee of
Flavourly.com concern with their salary issues as well as benefits that may affected from the
same. All this things that leads to demotivate people so that working performance of an
individual. If Flavourly.com change impact as a major one so that this will be impact on the
individual in a effective manner (Victor, 2015). In addition to that this will assist to manage the
change in a biggest manner.
In this various positive impact is also included in this in which management concern with
the various new opportunities that leads to growth of individual as well as its motivation towards
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the same. By adopting the change management can promote their future. With the help of this
management can oversee the perception of individual that cover the improvement in the attitude
of individual. Moreover change impact in the positive and negative both way so that
management can concern with the change in the time to time.
AC4.2 Plan for management of changes
When management of Flavourly.com changes their working method, it led to the various
things. For this management of entity develop plan for the change so that change will be impact
the business in a effective manner (Lussier and Sonfield. 2015). Here are some points discuss
below as a plan that is assist to handle with the change.
 Management of the company has to focus on all that point that impact on the change in
which they do this thing before the change.
 After this they develop strategy that is use for the all changing process such all important
decision, working method, cost that affects the finance the department and last but not
leads employee behaviours with the change.
 In addition to that now management of the Flavourly.com concern each and every point
that is listed above. In which they focus on the working that leads to the better impact of
change.
 Management also involve employee in this process so that they can involve their
individual in the decision-making process so that they are able to now the change as well
as the reason of change.
 When employee become able to understand and ready to change now at that movement
changes take place towards the same.
 At last management of the entity focus on implementation of change in which they
develop training and section for better implementation and this will also assist to manage
the work in a effective manner. In this training management try to improve their
employability skills towards change and resist with it.
 So the moreover this planning in contest of change become its successful and this will
also positively impact on the goodwill of Flavourly.com.
A systematic planning is always leads to the growth of individual as well as organisation. So that
change is good but with the systematic planning is necessary for the same.
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AC4.3 Improvements in performance
Below depicted table is the trend graph of the company that are based on the performance
of the company for past two years.
Improved parameters 1-6
Months
6-12
Months
12-18
months
18-24
Months
Consumers
Merchants
Delivery options(Quicker deliveries)
Its clearly visible that past two years saw relative growth for the company. The number of
consumers increased rapidly in the initial months. This was because of the introduction of better
opportunities in subscription and payment methods. With improvement in the document structure
of the suppliers more merchants got interested to work with Flavourly (Jones, 2014). As specific
producers worked for specific flavours and taste of products, the company got an opportunity to
introduce more options and variety for the consumers. Quick and efficient deliveries were a
relief for the customers. They could get their orders according to the relevance and demand
without getting stuck by undesirable reasons.
CONCLUSION
The complete journey of an idea to its implementation and transformation from a thought
to a real time functioning business is a start up process. This report enlightens young minds with
the functioning and bringing up of a small business enterprise. The main aim of the report was
achieved by understanding the processes involved in a small business and by reviewing the
performance of Flavourly. This report also provides comprehensive insight about the plans that
can be used for proposing changes in the management or business operations as well as the
impacts of these changes. Overall working of a small business enterprise has been elaborated
with reference to Flavourly. Small business enterprises must be encouraged in every country for
safeguarding consumers from monopoly as well as heading the company towards sustainable
development.
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REFERENCES
Books and Journals
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strategy and owner-manager characteristics. Journal of small business and enterprise
development. 20(1). pp.8-27.
Bridge, S. and O'Neill, K., 2012. Understanding enterprise: entrepreneurship and small
business. Palgrave Macmillan.
Burns, P., 2010. Entrepreneurship and Small Business: Start-up. Growth and Maturity. Palgrave
Macmillan.
Forsman, H. and Temel, S., 2011. Innovation and business performance in small enterprises: an
enterprise-level analysis. International Journal of Innovation Management. 15(03).
pp.641-665.
Freel, M. S., 2013. Enterprise and small business: Principles, practice and policy. International
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MacDonald, R. and Coffield, F., 2015. Risky business?: youth and the enterprise culture.
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Murphy, H. W. and Leonard, D., 2016. Quality management (QM) leads to healthier small
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Online
About. 2016. [Online]. Available Through:<https://www.flavourly.com/about/>. [Accessed on
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Burn Callander, R., 2015. Dragon slayer spurns all five celebrity investors. [Online]. Available
through: <http://www.telegraph.co.uk/finance/businessclub/money/11425644/Dragon-
slayer-spurns-all-five-celebrity-investors.html>. [Accessed on 12th December, 2016].
FAQs. 2016. [Online]. Available through: <https://www.flavourly.com/faqs/>. [Accessed on 12th
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Jones, M. 2014. 10 Exciting Crowdfunded… Foods. [Online]. Available
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December, 2016].
Victor, A., 2015. Gourmet food start-up Flavourly raises £300,000 through crowdfunding in just
three weeks... after turning down FOUR Dragons' Den investors. [Online]. Available
Through:<http://www.dailymail.co.uk/femail/food/article-3007611/Gourmet-food-start-
Flavourly-raises-300-000-crowdfunding-just-three-weeks-turning-FOUR-Dragons-Den-
investors.html>. [Accessed on 12th December, 2016].
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