Relationship Between Resource Acquisition Methods and Firm Performance

The assignment delves into the topic of resource acquisition methods and their impact on firm performance in Chinese new ventures. It specifically examines the intermediate effect of learning capability in this context. The paper reviews existing literature on new venture teams, international entrepreneurial culture, and innovation antecedents, among other topics. It provides a comprehensive analysis of the subject matter, shedding light on the importance of resource acquisition methods for firm success.

UNIT 28 LAUNCHING NEW
VENTURE

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Investigate and explain a new venture chosen organisation, identifying specific target
markets and undertaking competitive analysis.......................................................................1
Competitive analysis..............................................................................................................2
P2 Determine specific tangible and intangible resources that would be required by your
chosen organisation for the launch of a new venture............................................................2
TASK 2............................................................................................................................................3
P3 Credible proposal to launch a new venture in your chosen organisation..........................3
P4 Skills and capabilities required to launch a new venture and how they are acquired or
developed................................................................................................................................4
TASK 3............................................................................................................................................5
P5 different promotional activities and channels that will support the launch of the new
venture ...................................................................................................................................5
P6 Appropriate promotional activities plan for both launch and pre-launch of your chosen
organisation’s new venture.....................................................................................................7
TASK 4............................................................................................................................................8
P7 Cash budget for the pre-launch phase of the venture and the first 12–18 months preceding
launch of your chosen organisation’s new venture................................................................8
P8 Appropriate legal form for the venture, stating why it has been chosen for organisation. 10
CONCLUSION..............................................................................................................................10
References .....................................................................................................................................12
Books and journal ................................................................................................................12

INTRODUCTION
Business is defined as a procedure of buying and selling of products which will help
individual in earning of profits (Aldrich and Yang, 2014). this report discusses about expanding
of business and targeting specified segment of customers. Organization critically assesses the
business’s state of affairs and identifies whether it will be economic to expand its business
activity. In this competitive world there are many rivals of coffee market.
Moreover, competitive analysis helps in identifying the competitor and also assist in
identifying the strategies to determine their strength and weakness. Assignment cover topics
proposals to launch a new venture, skills and capabilities required to launch a new venture. In
said assignment Lazer coffee shop is being established, which serves quality coffee along with
some pastry to satisfy customers demand. Project emphasis on promotional activities plan which
are required for both launch and pre-launch of coffee shop.
TASK 1
P1 Establishing of coffee shop, distinguishing specific target markets and undertaking
competitive analysis
Investigating new venture:
Business is defined as transfer of goods and services to earn profits, entrepreneur perform
all activities required for running business effectively. New venture established is Lazer coffee
shop, which aims at delivering valuable services to its clients. Cafe stores critically evaluate the
business environment and identified that it will be profitable to expand its operation (Andersson,
Evers and Kuivalainen, 2014). In addition to this coffee shop mainly strategies in building the
strong brand by attracting potential customers. They put many strong efforts in establishing
strong relation with clients in order to build strong brand image. Organisation delivers quality
beverages in order to satisfy their customers and capture market share.
Specific target markets
Lazer coffee bar on the basis of observations, targets young generation and youth having
age of 19 to 26 because they prefer having coffee more, than compared to other age group
people. In order to achieve targeted segment, business expands its operations at university of
Cambridge in UK. Lazer coffee is ascertained to become requirement for the people, having
coffee on regular basis. It focuses on developing a comfortable place where students hang out in
order to reduce stress of normal life (Barringer, 2015). It was observed great demand of high
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quality gourmet coffee, so in order to satisfy the requirement the offer coffee with combination
of pastry.
Competitive analysis.
In this competitive world there are many competitors in the coffee market as they
strengthen themselves in achieving high potential growth. Moreover, competitive analysis helps
in identifying the competitors and also helps in evaluating the strategies to determine their
strength and weakness. Mainly there are two types of competition in the market which can be
defined as direct and indirect (Bettis and et.al., 2015). When an organisation competes with the
same coffee offering in known as direct competition whereas indirect is if they come up with
combination of other innovative idea. According to the competitive analysis the main strengths
of coffee shop is unique décor and offers amazing taste of beverage. Shop is open till late night,
and establishes unique relations with their potential buyers.
Small menu with less variety was identified as the weakness in above analysis. There
were various opportunities available in business market as they can open more coffee shops at
every centres where customers find it easily and rapidly (Competitive analysis, 2017). Moreover,
it helps in increasing the profitability of business and enhances its customers base. Business has
threat of high entering cost because new firms can enter market at any time thus decreasing
overall profits.
P2 Determine specific tangible and intangible resources that would be required by coffee shop
Tangible resources
Every business need resources to carry out its operations effectively, tangible resources
will enhance profits and output of the organization (Tangible resources, 2018). Tangible
resources can be termed as assets of company which is essential for generating revenue and
profits.
Human resources: it is other tangible assets that is needful to carry out any form of commercial
activity. it is the tangible asset that work effectively to generate end product and provide profits
to businesses (Cai, Hughes and Yin, 2014). While unskilled labour might be proper for simple
activities like serving and washing of dishes etc. highly skilled labour is essential to operate
complex and advanced coffee machines which will serve quality beverages to clients. Such a
capable human force is much in required by Lazer coffee bar as it is rather difficult to obtain
enough of such skilled workers.
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Financial resources: it is most essential factor for establishing new coffee bar, there are
multiples of additional costs like start-up expenses, printing of menu cards which are incurred.
Capital can be arranged by various sources like banks, financial institutions and personal savings
(Cardon, Post and Forster, 2017). Entrepreneur of a coffee works hard in order to cover all the
cost and start earning revenue from the selling of coffee. UK government promotes
establishment of small business in order to increase employment opportunities and decrease
poverty from the country.
Physical resources: it is crucial to identify the correct location in order to reach the targeted
segment of customers which is young generation. Coffee shop must have adequate resources to
perform all activities of business. Businessperson of the new venture critically evaluates its
assets before taking any decisions regarding purchase, marketing, etc.
Intangible resources of entrepreneur of Lazer cafe play crucial role in their growth and success,
as it defined as potential to start up new venture. Some intangible resources which will be
required by enterpriser are given below (Daily, Kieff and Wilmarth 2014). Intangible resources
aim at delivering quality services, in order to increase its customers base.
Goodwill of the organisation: This is an essential element which is required for starting up
coffee shop, Lazer cafe can capture market with its good brand name. People generally prefer
buying products from the with known business.
TASK 2
P3 Credible proposal to launch a coffee shop named as Lazer Cafe.
Idea generation: this is termed as a process of developing and communicating of
objectives which are essential to carry out the process of establishing required goals and
objectives (Business proposal, 2017). Company organises group discussions, management
motivates stakeholders to actively participate in the above mentioned process.
There are various marketing researches which are conducted to identify taste and
preferences of clients. For example, before Lazer cafe served coffee in combination with pastry
to satisfy the need of college students. According to market research conducted by business it
was ascertained rise in coffee demand (Fisher, Kotha and Lahiri, 2016). In order to increase
profits and sale the venture can be started up at college campus. It offers various types of coffee
like cappuccino, espresso, iced coffee, decaffeinated coffee with whipped cream, and flavoured
coffee syrups.
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Idea modification: company must take regular reviews from clients in order to assure
that desired objective is achieved. Lazer cafe targets working people and university students but
it was observed that they were not satisfied with the services of the organisation. In this process
testing phase is involved which considers regular interactions with potential buyers to identify
the weak points. Customers wanted to have brownies and biscuits in addition with gourmet
coffee (Géraudel, Gast and Gundolf, 2017). Cafe decided to add healthy biscuits and food items
in the menu, in order to increase the targeted customer base.
Idea execution: it includes Start-up phase where promotional techniques is adopted by
cafe shop to reach the identified targeted segment. Lazer cafe aims at their potential customers to
convert them into loyal coffee consumers by satisfying demands of adding food menu. Company
offers free cups of coffee to the clients who are first time entering in shop to attract them. They
must assure that different types of coffee are delivered to various age groups. For example, cold
coffee is generally preferred by young people whereas old age people have hot coffee.
Advertisement of cafe can be given on college magazines with attractive colours and
promotional offers like; ‘buy coffee and get a mug free’ (Marion and et.al., 2015). They can also
offer royalty points which clients can redeem next time when they visits bar. Above mentioned
planning can help in increasing the customers base and satisfying the targeted market.
P4 Skills and capabilities required to launch a new venture and how they are acquired or
developed
In order to start up new venture, entrepreneur is required to have certain skills and capabilities.
Some of them are given below
Leadership skills: It plays a crucial role in achieving desired goals and objectives within
prescribed time frame. Entrepreneur must be capable enough to guide and motivate their
followers for overall goals of the coffee shop. They must encourage workforce to enhance their
productivity by providing quality beverages to clients. Lazer cafe welcomes all suggestions of
staff which assures healthy working environment of business. Satisfied employees will help in
establishing good relations with customers and treat them in appropriate manners.
Business planning skills: entrepreneur must critically evaluate business environment and
develop business strategies to deal with changing taste and preferences of clients (McGowan and
et.al., 2015). Manager of cafe is concerned about managing daily operations of business like
serving quality beverages. They are required to collect regular feedbacks from customers and
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enhance existing procedures and products. Applying of business strategy can result in overall
increase in profits and achieving long term objectives of expanding business.
Marketing skills: In order to run business successful it is important to understand need of their
potential clients. Marketing is termed as important skill as it aims at delivering quality services to
its clients because sale of business is an essential target. It helps Lazer cafe in understanding
current trend of market which is essential to increase sales and profits of business. To reach
targeted market segment which is student and office going employees, it is essential to match
demand and supply.
Communication skills: it is an effective tool used for delivering right information about
products to potential clients. Entrepreneur must be capable enough of using the correct words in
appropriate way to reduce the chances of misinterpretation (Sleuwaegen and Onkelinx, 2014)
communication skills is required by coffee shop to spread awareness about the promotional
offers which they are giving to grab attention of the clients. This helpsw in establishing good
relations with potential buyers and building loyalty towards Lazer cafe.
Effective management of human resource: it is crucial to hire capable workforce in order to
carry out business operations effectively. Lazer cafe sets goals for employees and leaders
motivates them to achieve set standards. Human resource management is a part of leadership
skill, as it coordinates the efforts of workforce in a common direction. For example, Lazer cafe
has talented workforce which delivers quality services and resolves all quires of the clients.
Finance and accounting skills: profitable business can also run in loss if entrepreneur fails to
manage cash. Funds are required to carry out every activity of business smoothly and effectively.
Lazer cafe decides prices of coffee after considering all expenses and costs which are incurred in
the process of business.
TASK 3
P5 different promotional activities and channels that will support the launch of the new venture
Developing a promotional plan is extremely important as it helps to make plans for the future.
There are multiple types of promotional activities as it is necessary for the Cafe (Zeichner and
Pena-Sandoval, 2015). With the help of these activities cafe can generate the awareness among
the people about the best quality services that Lazer cafe provides.
The promotional activities plan for launch of Lazer cafe are doing advertising through
newspaper, pamphlets etc. There are many activities that are:
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-Social media: Social media is the effective marketing tool. As from various websites like
Facebook, twitter, etc. they are the best platform for promoting. Cafe can create the Facebook
fan page. As social media allows individuals to interact with each other and by this we can reach
to billions of people on one platform.
- Vouchers: Cafe will provide free vouchers as people love new and free things and will love to
do what it takes to get it free. This will pull the customer in free coffee for first time customer.
As from vouchers everyone should know about the Cafe
-Feedback cards: By the feedback cards cafe knows about the customer’s experience . Learning
from the honest feedback given by customer is crucial to the success of the cafe. Through
feedback there is the enhance cafes data base as we can take personal details by feedback. An
email address is needed by which we can build customer base.
- Free Wi-Fi: Providing internet facility such as free Wi-Fi is must for customer these days and
from free Wi-Fi with good speed they can enjoy. And if someone wants to do their work they
can do easily with high speed of Wi-Fi and can enjoy the coffee.
Pre- launch is also very important as by this we can generate awareness among the
customers. As pre-launch is done through various activities like digital and social media.
Through pre advertising people came to know about the cafe and about the services that we
provide them. They will come to know about the special offers and specialities of the cafe
(Aldrich and Yang, 2014).
- website: Venture will build the website and it takes google a few months to find a website. By
creating website one can visit our website and can know everything about the cafe. Customer can
know about the location, contact us, about menu, interior etc. Website helps the customer to
know more about the cafe.
- Application for cafe: There will be app for cafe so the customer. They can install it in their
handset and can check about the offers. If they want to give order than they can give there. They
can order from home or from any place. By this online customer will generate.
-Facebook offers: There will be Facebook and twitter offers for those who are following the page
on Facebook. By giving Facebook offers our following will increase and they will also visit the
cafe. with positive Facebook comments there will be increase in the image of the cafe.
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-Flyers: Flyers are very potent and effective in covering the local areas. Flyers can reach
everywhere we can’t reach and by this everyone can know about the cafe. flyers are quick inside
the stores and if someone is going through the cafe then they will remember the advertise
through flyer and they will visit the cafe.
P6 Appropriate promotional activities plan for both launch and pre-launch of coffee shop
Launching of new venture
Identifying target customer: It is necessary to identify customer base to increase profits and
revenue of business. Lazer cafe has targeted university students and people going to office which
has age group of 19 to 25. Business is set up near college campus in order to have continuous
interaction with clients.
Developing of product: after deciding the targeted segment, it becomes easy to design a product
which will satisfy their requirements. Lazire affair identified the need of serving coffee in
addition with pastry (. Andersson, Evers and Kuivalainen, 2014). Business uses high quality
ingredients which is coffee beans in making of beverage. They came up with innovative idea of
gourmet coffee, that grabs attention of potential clients.
Promotional strategy: promotional strategy plays a crucial role in spreading awareness about
the specific product, so that customers can choose them over the competitors. Lazire affair
promotes coffee by giving free cups to the people those who have stepped first time in the shop.
Promotion of shop is given on educational institution magazines with attractive colours and
catchword like buy coffee and get a cup free. They assure that customers are provided with
varieties of coffee like espresso, cappuccino, etc. company add points of 10% the bill amount
generated which clients can redeem in their next purchase.
Pre-launch strategy
Financial statement: entrepreneur must critically evaluate financial capabilities of business in
order to invest money in different activities like marketing, production, etc. financial statements
helps in identifying the availability resources which can be utilised by business to deliver quality
services to clients.
Setting up of timeline: entrepreneur must plan in advance desired number of sale which can be
achieved in a specific time duration. For example, Lazer cafe plans to increase sales by 2% at the
end of this year (Barringer, 2015). Setting up of target helps business to achieve goals and
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objectives by developing of strategic plans. Shop can focus on adding extra items in menu card
to attract the attention of its potential clients, this will help them in achieving target.
Targeted clients: To increase sales and profits of business, it is essential to reach targeted
segment of clients. In present scenario company focuses on young generation because they prefer
to have more hangout as compared to adults. To achieve desired sales results they have targeted
age group of 19 to 25.
Deciding place: in order to attract customers to coffee shop, it has been set up inside Cambridge
university. It was observed that students like to have coffee and some snacks and spend good
time with their friends.
Goals: organisation assures that their goals and objectives are achieved within the given time
frame. Lazer cafe effectively utilises resources of business to achieve target of increasing sales
by 2%.
TASK 4
P7 Cash budget for the pre-launch phase of the venture and the first 12–18 months preceding
launch of your chosen organisation’s new venture
Lazer coffee is an organisation which sale quality beverages like coffee, in addition to its
offer pastry and some snacks. This is situated inside campus of university, which will enhance
the customers base. Funds of the business were mainly arranged from two sources banks loans
and owner’s personal savings (Bettis and et.al., 2015). It was observed that business took loan of
100000 from financial institution and has own investment of 30000 which brings total capital up-
to 130000. Mentioned below is cash budget of Lazer cafe.
Table 1: Cash budget for Lazer
Initial expenses of business $
Furniture 1300
Coffee machines 600
Raw materials purchases 3200
Insurance 2400
Rent 4500
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Other 1600
Total amount for start-up business 13600
Start-up expenses
Start-up assets 65000
Cash required 15000
Inventory cost 12000
Current assets 300
Non-current assets 4520
Total assets 96820
Total requirements 110420
Expenses to cash 25000
Start-up assets 14000
Funding required 39000
Assets
Non cash assets from initial stage 74000
Cash requirement from initial stage 65000
Additional cash 5000
Starting date balance 68000
Liabilities and capital
liabilities
borrowings 15000
Long term liabilities 10000
Outstanding bills 0
Total liabilities 0
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capital
Banks 100000
Own investments 40000
Planned investments 0
Loss during initial stage 120000
Total capital 25000
Total capitals and liabilities 113250
Funding total 165200
P8 Appropriate legal form for the venture, stating why it has been chosen for coffee shop
Venture is defined as process of establishing new business in order to satisfy needs of the
clients along with the motive of earning profits and expanding its operations.
Sole proprietorship: it is defined as a type of business which is owned and managed by single
person. Entrepreneur is responsible for all loss and profits of business; it has unlimited liability.
It is most simple and easiest types of venture as it has minimum legal requirements which are to
be fulfilled.
Partnership: This is a legal form of business which consists of formal agreement between two
or more organisations (Cai, Hughes and Yin, 2014). Entrepreneurs mutually decide to share
liabilities and effectively manage all operations of business.
Limited company: members of organisation has limited liability up-to the amount of unpaid
share. In addition to this organisation is owned and managed by private individuals.
Appropriate form of venture for establishing coffee shop is sole proprietorship, some of its
advantages are given below.
 It is simplest and instant way of starting up new venture with minimum legal formalities.
 Sole proprietor gets tax benefits. For example, they are exempted from paying of income
tax.
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 Owners have advantage of combining personal assets with business to pay borrowed
funds or debts.
Lazer coffee shop can choose partnership legal approach to set up its new venture. This
Lazer coffee shop can establish its venture with the building partnership with universities and
other well known coffee shops and restaurants. This will help the Lazer coffee shop to easy
access and building venture because it need less capital. In the partnership Lazer and others firms
jointly start the firm and it will also help the Lazer coffee shop to easy recognisable as if it
established venture with well known restaurants or coffee shops or with the university.
CONCLUSION
This project concludes that establishing of new venture is a complex procedure,
entrepreneur need to work hard in order to achieve the desired goals and objectives. To start up
new venture it is significant to identify targeted market and conduct competitive analysis to
assure expansion goal is accomplished. In order to start up new venture, entrepreneur is required
to have certain skills and capabilities. Entrepreneur must have leadership skill to be capable
enough to guide and encourage their staff members for accomplishing the goals of the coffee
shop Further this project explained that marketing research is essential, as it helps in identifying
requirement of customers. There are different resources both tangible and intangible out of which
financial resources is considered to be important for establishing new coffee bar. There are
multiples of additional cost which are incurred for example start-up expenses, printing of menu
cards, etc.
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REFERENCES
Books and Journals:
Aldrich, H.E. and Yang, T., 2014. How do entrepreneurs know what to do? Learning and
organizing in new ventures. Journal of Evolutionary Economics. 24(1). pp.59-82.
Andersson, S., Evers, N. and Kuivalainen, O., 2014. International new ventures: rapid
internationalization across different industry contexts. European Business Review. 26(5).
pp.390-405.
Barringer, B.R., 2015. Entrepreneurship: Successfully launching new ventures. Pearson
Education India.
Bettis, R.A., and et.al., 2015. Qualitative empirical research in strategic management. Strategic
Management Journal. 36(5). pp.637-639.
Cai, L., Hughes, M. and Yin, M., 2014. The relationship between resource acquisition methods
and firm performance in Chinese new ventures: The intermediate effect of learning
capability. Journal of Small Business Management. 52(3). pp.365-389.
Cardon, M.S., Post, C. and Forster, W.R., 2017. Team entrepreneurial passion: Its emergence
and influence in new venture teams. Academy of Management Review. 42(2). pp.283-305.
Daily, J.E., Kieff, F.S. and Wilmarth Jr, A.E., 2014. Introduction. In Perspectives on Financing
Innovation (pp. 13-16). Routledge.
Fisher, G., Kotha, S. and Lahiri, A., 2016. Changing with the times: An integrated view of
identity, legitimacy, and new venture life cycles. Academy of Management Review. 41(3).
pp.383-409.
Gabrielsson, M., Gabrielsson, P. and Dimitratos, P., 2014. International entrepreneurial culture
and growth of international new ventures. Management International Review. 54(4).
pp.445-471.
Géraudel, M., Gast, J. and Gundolf, K., 2017. New product and service launching in new
ventures: a multilevel approach to innovation antecedents. Economics of Innovation and
New Technology. 26(4). pp.353-367.
Klotz, A.C., and et.al., 2014. New venture teams: A review of the literature and roadmap for
future research. Journal of management. 40(1). pp.226-255.
Marion, T.J., and et.al., 2015. The evolution of interorganizational relationships in emerging
ventures: An ethnographic study within the new product development process. Journal of
business Venturing. 30(1). pp.167-184.
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McGowan, P., and et.al., 2015. The influence of social and human capital in developing young
women as entrepreneurial business leaders. Journal of Small Business Management.
53(3). pp.645-661.
Sleuwaegen, L. and Onkelinx, J., 2014. International commitment, post-entry growth and
survival of international new ventures. Journal of Business Venturing. 29(1). pp.106-120.
Zeichner, K. and Pena-Sandoval, C., 2015. Venture philanthropy and teacher education policy in
the US: The role of the New Schools Venture Fund. Teachers College Record .17(6).
pp.1-44.
Online:
Tangible resources. 2018. [Online]. Accessed through
<https://yourbusiness.azcentral.com/tangible-vs-intangible-resources-20874.html>
Business proposal. 2017. [online]. Accessed through;
<https://www.business.gov.au/planning/business-plans/writing-a-business-plan/how-to-
write-a-business-plan>
Competitive analysis. 2017. [online]. Accessed through; <
https://www.entrepreneur.com/encyclopedia/competitive-analysis>
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