Entrepreneurial Opportunity: Coffee Fusion Business Report Analysis

This report presents a comprehensive business plan for Coffee Fusion, an entrepreneurial venture focused on providing organic coffee with brown sugar in the UK. It begins with background information on the inspiration behind the idea and the entrepreneur's motivations. The report then introduces the business concept, identifying the target audience as health-conscious individuals and the location as prime areas within the UK. A detailed competitor analysis using Porter's Five Forces is conducted, followed by a gap analysis employing the McKinsey 7-S model to assess the current and desired performance. Market research supports the business's viability, including an examination of strengths, weaknesses, risks, and future growth opportunities. The report highlights the potential for Coffee Fusion to gain a competitive advantage by offering a unique product in a market with significant demand. The analysis covers the business's potential by targeting old age customers and health-conscious people. Overall, the report provides a thorough assessment of the Coffee Fusion business opportunity.

IDENTIFYING
ENTREPRENEURIAL
OPPORTUNITIES

Table of Contents
INTRODUCTION...........................................................................................................................3
1. Background information about those sources that inspired your idea and what motivated
you personally in wishing to set up your own business..............................................................3
2. An introduction to your business idea and what it is, and who and where your potential
customers and target audience are ..............................................................................................5
3. A competitor analysis that looks at the competitive marketplace...........................................5
4. Gap analysis, current and future situations and objects of business ideas..............................7
5. Market research to support viability for your business idea...................................................8
6. Why your business idea is viable, what are the strengths and weaknesses. How will you
overcome the risks and the potential opportunities for growth and development in the future?
...................................................................................................................................................15
CONCLUSION..............................................................................................................................17
REFERENCES..............................................................................................................................17

INTRODUCTION
Entrepreneurship is defined as the capacity and the willingness to develop, start, organise
and manage a business venture assuming all the risk in the hope of earning more profit. These
are normally the small business and individuals who develop these business are known as
entrepreneurs. In order to start this venture various innovative ideas are required to get success
and maintains their profitability level. This report is based on developing a business idea by
identifying the opportunities within UK, i.e to start a new venture of Coffee Fusion which will be
made using organic beans with brown sugar to grab the attention of health conscious people and
this innovate offering will led to capture larger market share (Baldacchino, 2013). Along with
this it also analysis competitive market place and conducts market research through collection of
primary and secondary data to support viability of business idea.
1. Background information about those sources that inspired your idea and what motivated you
personally in wishing to set up your own business.
In order to select the most viable idea, entrepreneur needs to identify the available
opportunities in the market which assist in the growth and success of their business venture.
Therefore the new idea developed is to start a business venture of Coffee Fusion which will me
made using Organic beans with brown sugar to target health conscious customers and meet their
satisfaction level. With the help of Peter Drcuker Model seven sources of innovation are
explained below-
The Unexpected- Business situations are uncertain in nature which may leads to
unpredictable success and failure of business idea. These serves as a great source of business
idea and inspires managers within Coffee Fusion to develop more ideas and take the advantage
of the situation within the business.
Incongruity- Proper information should be collected to determine their target customer
as well information about customers tastes and preferences should be gather to provide the
products according and determine the success of the company (Elenurm, 2012). Coffee Fusion
should collect information through customer surveys and feedback and provide organic coffee
according to their demand.
Process Need- As by identifying weakness, it led to the analysis of available opportunities in
market and assist entrepreneur to develop a new business idea. This act as a source of new
business idea and helps in the development of venture.

Industry and Market Structure Change- As because of the intense competitive in the market
and use of advanced technology led to the development of innovative products and services.
Hence managers at Coffee Fusion should analyze these changes and develops new products
according to the existing trends.
Demographics- This factor is a great source of business idea as demographics is related to the
age, gender and education of the customer. Change in such factor leads to the development of
new business idea. Coffee Fusion is developed by analyzing the demand of health conscious
customer and also to target old age customers (Grégoire and Shepherd, 2012).
Change in Perception- Perception of customers for the product varies differently because of the
various competitors products available in market as well as technological change. This act as a
source of new business idea to develop products differently according to the perception level of
customer.
New Knowledge- In this competitive market place, it is necessary for the business to adopt
recent technology and new ways of performing their business activities. This led to the
innovation of a new product and meet the perspective of customers.
From all the above sources new innovative ideas can be developed and allow Coffee
Fusion to maintain their sustainability in this competitive market place.
2. An introduction to your business idea and what it is, and who and where your potential
customers and target audience are
Entrepreneurial business helps in the growth of nations economy as well as provides
innovative offerings to gain competitive advantage and sustain in the market for long period of
time. Business ideas are collection of thoughts which are developed by conducting market
analysis and grabbing the available opportunities towards starting a new business. Therefore
business idea should be impressive so as to target larger customer base and achieves their goals
in a significant manner. The business idea develop is to start a Coffee Fusion Venture in which
coffee will me made using organic beans and brown sugar which keep the customers calorie and
sugar level down and keep them away from the stress (Hang, Garnsey and Ruan, 2015). Thus its
a new and innovative concept which will allow entrepreneurs to enhance sales and improve
profit margins for the company. Characteristics of Coffee Fusion Business idea are promising
and will automatically helps in the growth of small business idea.

Target Customers- As the Coffee Fusion is made up of organic and natural ingredients,
target customers would be old age customers and health conscious people who are very much
concern for their health. Consumption of this coffee will reduce the calorie and sugar level and
provides a healthy lifestyle to the customers. These are the target customers for the new product
but it s potential customers includes individuals from all age groups who can enjoy coffee and
maintain a healthy life style. This new product will be available in all prime locations within UK
so that the new product is easily accessible to the customers (Hansen, Monllor and Shrader,
2016). Moreover the business venture can adopt various promotional tools such as
advertisement in social media tools to grab the attention of large number of buyers. Therefore
word of mouth promotion will assist in the growth of small business. Apart from this changes
would be made in the existing product according to the changing demands of customers and
meet their satisfaction level.
3. A competitor analysis that looks at the competitive marketplace
In order to succeed effectively it is necessary for the business to properly analyses the
competitors within the market place. This led to analysis of the available opportunities in the
market and leads to the effective development of idea. Moreover it has been analyzed that in the
UK market individuals have tendency to drink coffee. Thus this is a good opportunity for the
business to develop their business idea of providing fusion coffee to the customers. With the help
of Porters five forces model it provides an insight to Coffee Fusion to determine the level of
competition. This is explained as follows-
Porters five forces Model
Porters Five forces is a effective tool for analyzing the level of competition and
determines the attractiveness of the industry in terms of profitability.
Threats of New Entry- As the respective business idea is about developing organic
coffee which is a unique and a attractive concept, leads to targeting larger customer base and
maintains sustainability of the business (Kohlbacher, Herstatt and Levsen, 2015). Moreover this
require huge investment and high research for developing the innovative idea. This restricts the
entry of new firms within the same sector.
Intensity of Rivalry- As within the UK market, individuals have a great tendency to
have coffee and enjoy with their friends and relatives. Thus this existing demand has increased
the opportunity for the Coffee Fusion to grow and effectively sustains in the market. Competitors

in the UK market for Coffee Fusion are Costa, Caffe Nero and Coffee Republic. Therefore
Coffee Fusion is providing organic coffee with brown sugar which is not provided by any other
competitors leads to gain competitive advantage. But to the due to existence of many large
competitors Coffee Fusion should upgrade its products and effectively sustains in market
(Mitchel, more,and Rowley, 2013).
Bargaining power of suppliers- Their are few suppliers of raw materials of organic
coffee within the UK market as well as greater demand for the product. This led the suppliers to
raise the prices of the raw material and enjoys more bargaining power.
Bargaining Power of Buyers- Coffee Fusion should provide high quality products to the
customers at a moderate rate to have low switching cost of the buyers. Moreover the business
targets health conscious customers and old aged customers. It doesn't targets individuals from all
age groups. Therefore target customers have a high bargaining power because of the various
competitor products available in market. Thus Coffee Fusion should provide innovative offerings
at a moderate price so as to attract larger customers and lowers down the switching cost of
buyers.
Threat of Substitute products- If there are large number of substitutes available for
Coffee Fusion it lowers down the profit margins for the company and customers can easily
switch towards the substitute products. Moreover for organic coffee, organic tea is the substitute
products, therefore Coffee should add innovative features in order to gain the advantage and
reduced the threat of substitute products (Sarasvathy and et. al., 2010).
From this model it has been analyzed that there is intense competition prevailing in the
UK market moreover company has a chance to set up coffee venture in UK because of the
greater demand of the customer.
4. Gap analysis, current and future situations and objects of business ideas.
Gap analysis is the comparison of the actual performance with the desired performance.
This provides an idea to the entrepreneur to adopt effective strategies and minimizes the gaps
analyzed in the outcomes. However the gap signifies the present state of where the organization
is and where it wants to be.
As the major focus of the business is to provide quality products to meet the requirements
and satisfaction level of customers. Moreover gaps should be effectively minimized by choosing
the effective strategy (Tontini and Dagostin, 2010).

Their are several tools which enables the company to analyses the gap based in their current and
target performance. McKinsey is the effective model which consist of elements divided into two
groups such as hard elements which are tangible and can be controlled and soft elements which
are intangible and cannot be controlled.
Hard Elements-
 Strategy- It is the action plan should be made effectively after analyzing the gap between
the actual and target performance and assist business to gain a competitive advantage.
 Structure- It is concerned with the organizational structure followed within the
organization. It represents how divisions are organized and who is accountable to whom.
Thus Coffee Fusion should develop effective organizational structure to reduced the
conflicts and gaps in their performance (Yuan, 2013).
 Systems- It is the process through which daily activities are conducted within the
respective entrepreneur business. Therefore effective process should be followed at
Coffee Fusion which enables them to take effective decision and improve the working
practices within the organization so as to reduce the gaps.
Soft Elements
 Shared Values- These are the norms, standard rules and regulations which assist in
influencing employees behavior to work effectively and attains the target performance of
the company.
 Style- It represents the way which leadership style is adopted by the business to guide
and inspire employees to work effectively. Managers at Coffee Fusion should adopt
effective leadership style so that employees work effectively towards the success of
organization (Hills and Hultman, 2013).
 Staff- This element discusses what type of employees are required within the
organization with specific skills and capabilities. Qualified and trained employees should
be recruited at Coffee Fusion to minimize the gaps in their performance and attains
maximum profitability.
 Skills- These represents the abilities of the employees to perform their task effectively.
However necessary training should be provided to the employees at Coffee Fusion to
enhance their skills and knowledge and attains high profitability for business.

This is a effective tool which bridges the gap between the actual and target performance of
Coffee Fusion and attains competitive advantage (Popp and Holt, 2013).
5. Market research to support viability for your business idea
It is vital for the business to collect proper information regarding the market conditions
and the changing trends and also to analyze the demands and requirements of the customers
before launching the product. As the Coffee Fusion is introducing new organic coffee within the
UK market proper collecting of information assist the business to support the viability of their
business idea. Information can be collected through two methods such as Primary and Secondary
methods of data collection.
Primary Research- Under this method of data collection information through customers
is collected with the help of survey, questionnaire and conducting interviews. This helps in
getting first hand information from the customers and assist company to take effective decisions.
This assist the business to develop more innovative ideas by identifying the opportunities within
the market of UK (Chang and Chen, 2015).
Secondary Research- Under this method of data collection, information is collected
from the published sources such as in the form of journals, articles, books, magazines and many
other internet sources through which data is easily available and accessible. This assist the
entrepreneur to gather effective information regarding their business and provide the products
according to the existing trends.
Under this report, entrepreneur has used primary method of data collection with the help
of questionnaire and taken 40 respondents for the same.
Questionnaire
Name:
Age:
Address:
Q1 Do you know about the organic coffee being available in market ?
 Yes
 No
Q2 Does the product meet the requirement of health conscious customers?

 Yes
 No
Q3 Is the price for the organic coffee easily affordable to the customers?
 Yes
 No
Q4 Do the organic coffee needs to adopt extra flavours to target all age groups customers?
 Yes
 No
Q5 Is the product able to get competitive advantage?
 Yes
 No
Q1 Do you know about the organic coffee
being available in market ?
Frequency
Yes 30
No 10
Median 20
Mode 0
30
10
Yes
No

Interpretation- From the above data it has been analysed that out of 40 respondents, 30
are aware about the new organic coffee introduced in the market and rest are not aware about the
concept. This shows that business has adopted good promotional tools in creating awareness
about the new product.
Q2 Does the product meet the requirement of
health conscious customers?
Yes 25
No 15
Median 20
Mode 0
Interpretation- It has been analysed that among 40 respondents 25 are in favour that
products meets the requirement of health conscious customers whereas 15 respondents believe
that product should be modified and more of natural ingredients should be used to meet the
satisfaction level of customers.
25
15
Yes
No

Q3 Is the price for the organic coffee easily
affordable to the customers?
Yes 30
No 10
Median 20
Mode 0
Interpretation- From the above graph it has been concluded that among 40 respondents
30 believes that price for the organic coffee is affordable to all customers whereas 10
respondents are not in favour for the same. But large proportion of respondents are suitable with
the price of the product.
Q4 Do the organic coffee needs to adopt extra
flavours to target all age groups customers?
Yes 22
No 18
Median 20
30
10
Yes
No

Q4 Do the organic coffee needs to adopt extra
flavours to target all age groups customers?
Mode 0
Interpretation- It has been concluded from the above data that large proportion of
customers I.e. 22 respondents out of 40 believes that adding more flavours to organic coffee will
target larger customers from all age groups and leads to enhanced brand image but the rest 18
candidates are suitable with the organic coffee product.
Q5 Is the product able to get competitive
advantage?
Yes 32
No 8
Median 20
Mode 0
22
18
Yes
No