Fat Lama Business Plan Analysis

This comprehensive report provides a detailed analysis of Fat Lama's business plan. It covers various aspects of the company, including its background, market analysis, competitive landscape, marketing strategies, service offerings, business architecture, management and ownership, revenue model, financing requirements, financial data, and risk assessment. The report examines Fat Lama's unique business model of connecting individuals to rent out their belongings, highlighting its potential for growth and sustainability within the sharing economy. A thorough market segmentation analysis is presented, along with a discussion of competitive advantages and strategies for mitigating potential risks. The report concludes with an evaluation of the feasibility and value of Fat Lama's business opportunity.

BACKGROUND ANALYSIS OF FAT LAMA
1

TABLE OF CONTENTS
EXECUTIVE SUMMARY.............................................................................................................3
Overview......................................................................................................................................3
Background..................................................................................................................................3
The Problem.................................................................................................................................3
The Opportunity...........................................................................................................................3
Business Model............................................................................................................................4
Financial Results and Funding.....................................................................................................4
MARKET ANALYSIS....................................................................................................................5
Market Segmentation...................................................................................................................5
Analytical Spending & Outsourcing – Global Perspective..........................................................6
COMPANY DESCRIPTION..........................................................................................................6
Business Definition......................................................................................................................6
Value Proposition.........................................................................................................................7
Competitive Market.....................................................................................................................7
Market Share................................................................................................................................8
Revenue Generation.....................................................................................................................9
Competition..................................................................................................................................9
Regulatory Restrictions................................................................................................................9
MARKETING STRATEGIES......................................................................................................10
Overall Objectives and Strategies..............................................................................................10
Customer Focus..........................................................................................................................10
Laboratory Focus.......................................................................................................................10
Customer Oriented Activities.....................................................................................................11
2

Network Oriented Activities......................................................................................................11
SERVICE OFFERINGS................................................................................................................12
Product/Service Description......................................................................................................12
Copyrights, Patents and Trade Secrets.......................................................................................12
BUSINESS ARCHITECTURE.....................................................................................................14
Key Capabilities and Operating Model......................................................................................14
Operating Model........................................................................................................................14
Capability Description...............................................................................................................15
Technical Architecture: Description of the Key Components and Applications.......................15
MANAGEMENT AND OWNERSHIP........................................................................................17
Interim Governance Structure....................................................................................................17
REVENUE MODEL.....................................................................................................................20
FINANCING REQUIREMENTS.................................................................................................22
FINANCIAL DATA..................................................................................................................24
RISK AND CRITICAL ISSUES...................................................................................................25
Market Related Risks.................................................................................................................25
Supplier Network Related Risks................................................................................................26
Operations Related Risks...........................................................................................................26
CONCLUSION..............................................................................................................................28
REFERENCES..............................................................................................................................29
3

EXECUTIVE SUMMARY
Overview
A report is developed which will include information related to a business plan to a Start-up
named as Fat Lama. The company is working in a market of connecting people with the effect of
which they can provide their products on rent to others (Anon, 2017). To ensure that a proper
and effective set of direction could be provided to the company a business plan is developed
which will include all the aspects with the effect of which success and sustainability will be
obtained by the company in a competitive market.
Background
Fat Lama is a company which provides a platform to the customers to rent out their belongings
to other people in need available in the nearby location. This is the company which helps the
people in connecting with the people available in the neighborhood and helps them in using the
things at cheaper rates. Fat Lama believes that the people available should work together to
ensure that the world could become efficient (Poon, 2010). Fat Lama is a start-up which was
initiated by founders who left their corporate jobs so as to create a co-working space in East
London in the autumn of 2015. Eight weeks were spent by the co-founders in creating and
renovating a warehouse conversion in Hoxton on a shoestring.
The Problem
Many of the issues were faced by the company as expenses were increasing day by day in
managing the company as there were certain goods and tools which were required to purchase at
many of the times at a higher rate (Sawyer, 2011). In this situation, it has become important for
the company to develop a business plan which could help it in managing the expenses and
processing the work with quality.
The Opportunity
Adopting an effective set of strategies with the effect of which success of the company could be
maintained will be developed. In present time opportunity available with the company is to
diversify the business of to develop a new market. In-depth discussion in relation with these
4

factors will help in developing more effective and better set of understanding and will provide a
direction to the company in attaining success and sustainability (Lee, 2015).
Business Model
Fat Lama is an organization which is run and managed by several co-founders. The Co-founders
play a very vital role in every single aspect of the business. The company works on an online
platform where it provides access to the people to land and borrow their belongings. All set of
regulatory aspects are focused upon by the company in which assurance is made that fair trade
should take place. This helps in the business growth aspects and provides an opportunity for
growth and development in the market.
Financial Results and Funding
The company has set plans in relation to the financial aspects. Presently is growing at the growth
rate and is working towards to raise more funds so that it could enter the market of New York.
The company is working on a path of growth with the effect of which sustainability will be
obtained and a success factor will be developed with the effect of which it will attain competitive
advantage in the market. Fat Lama has an impressive idea which helps it in attracting funders
towards the business with the effect of which it manages it marketing aspects (Stoutenburg,
2015).
5

MARKET ANALYSIS
Online businesses are increasing day by the in the market due to which it has become important
that the start-ups trying to enter into the market should come up with innovative ideas. It is
required that the ideas with which the companies are trying to enter the market should be
innovative and new (ZANETTA, 2016). In the same manner, Fat Lama entered the market with
its idea of connecting people so that they can provide their products and services on rent for a
certain period of time to the people in need. This was helping people in making the process of
sharing their belongings in a quick and easy form.
Market Segmentation
Segmentation is the process in which bifurcation of the people available in the market is done on
the basis of geographic factors, demographic factors, behavioral factors and psychographic
factors. Targeting is done by the organization so as to ensure that people available in the market
could get attracted towards the products and services (Huang et al., 2015). Fat Lama is a
company which has targeted the people of the low-income group which is middle-aged people.
People who have less money to fulfill their needs they will visit the website of Fat Lama so as to
check whether they will be able to afford the product or service at a low cost or not. The
behavior of people is being evaluated by the company before indulging in any kind of strategy
this helps the company in obtaining a competitive advantage in the market and provides a set
direction with the effect of which more and more people get attracted towards the company.
It is necessary that the Fat Lama should develop the strategies according to the geographic
factors which include customer location and region like urban or rural. This classification of the
customer will help in developing marketing and promotional strategies with the effect of which
population of the mass area will get attracted towards the business (Sawyer, 2011).
Demographic factors should also be taken into consideration by the company in which factors
like age, gender, occupation, and the socio-economic group should be focused upon. This will
help in availing services according to the type of people and will help the customers in
classifying the products and services according to the classification.
6

Understanding the behavior of the customer and developing attractive packages according to
their behavior will also help Fat Lama in attracting a maximum number of customers towards its
products and services. Behavioural aspects include the rate of usage, benefit sought, loyalty
status and readiness to purchase (Wagner, 2012).
Psychographic factors also help the companies in understanding the market and help in
developing an appropriate set of strategies for managing the growth aspects. Personality,
lifestyle, attitudes, and class are some of the psychographic factors required to be undertaken by
Fat Lama. These factors will help Fat Lama in managing the work process and will help in
attracting a maximum number of people towards the business.
Analytical Spending & Outsourcing – Global Perspective
Fat Lama is the company which is totally dependent upon outsourcing. Without outsourcing, it is
not possible that the company could fulfill the requirements of the people available in the market.
The company works as a link between the people available in the market so that they can meet
and finalize the deal provided on the website of the company. In the rental market, the company
takes a 30-40 data points to create a risk profile for the renters (Stoutenburg, 2015). There are
90% of the renters who are qualified on the basis of the assessment. This helps the company in
ensuring that the renter will remain attached with the same and will ensure to avail the products
and services on rent. This helps the company in maintaining the outsourcing process and ensures
that timely delivery of the products and services could be managed.
The analysis was done and with the help of the secondary sources, it is being evaluated that
16.7% of the spending of Fat Lama is being made on outsourcing only as its whole business is
dependent upon it. It is being evaluated that the company is working toward to indulge in the
activities which could help it in outsource he work at international level so that it could provide
its services in other parts of the world (Rousek, 2010). This will help the company in entering the
global market which will help in enhancing its brand value and will provide a set direction for
the success of the company.
7

COMPANY DESCRIPTION
Business Definition
Fat Lama is a company which is helping the people in connecting and providing their belongings
on rent. In present time it is being evaluated that the things are changing and so the requirements
of the people are also changing. People in present time are moreover relying upon smart buy
rather than going for the products and services which are expensive. Online marketing is taking a
control over the market. Hence, in this condition introducing the concept of connecting people so
that they can avail their belongings on rent is really an impressive and effective idea
(CrunchBase, 2017).
Value Proposition
The company believes that sharing and caring, therefore to ensure that this legacy could be
maintained it is working towards to develop a system where they share their belongings in a
quick and easy way. Dream of the company is to develop a platform where all goods from
everyday to the abstract can be borrowed within a minute. This will help the people in managing
their day to day lives and will help in connecting people with each other.
Competitive Market
E-commerce is becoming highly competitive in which there are many of the competitors are
entering. People are starting up their businesses by introducing some of the other new and
innovative idea in the market (ZANETTA, 2016). Hence, to gain competitive advantage Fat
Lama prefers to ensure that all the up to date promotional and marketing activities could be taken
into consideration. The expansion is one of the strategies on which company prefers to focus
upon. Such type of activities will help the company in managing the things and will help in
attaining competitive advantage in the market.
Competition is one of the aspects which have a huge impact on the progress of a company. The
direct impact is caused by the sale of the products and services of the company due to which
growth of the company gets affected. It is necessary that the competitive strategies should be
developed by the company so as to ensure its success in the market (ZANETTA, 2016). To attain
competitive advantage in the market it is required that several aspects should be focused upon by
the company. These aspects are:
8

Cost leadership in which a company should ensure to develop the strategy in which it could lead
the market with its cost. Cost leadership will provide a proper set of support to the company in
managing the things and will help in attaining competitive advantage in the market.
(Poon, 2010)
Differentiation is another aspect which is required to be focused upon by the organizations
available in the market. It is necessary that Fat Lama should introduce the products and services
which are different from the other companies. This will help in attaining competitive advantage
and will help in providing a set direction of success and sustainability in the market (Sawyer,
2011).
Cost focus provides an opportunity for success but it narrows the progress of the company in the
market. To attain competitive advantage in the market it is required that company should remain
customer focus and should develop the strategies with the effect of which more and more
customers could get attracted towards the products and services of the company.
Differentiation focus is another aspect which is related to the competitive advantage in the
market. It is required that rather than relying completely on differentiation company should also
work towards to expand its business by entering into the new market. New market entrance will
provide a platform for growth and will help the company in connecting with new people and
covering a large area across the globe.
9

Market Share
Fat Lama is a company which remains indulged in the process of making an effective set of
contribution in the economic growth. The company has a 1 percent market share which helps it is
growing in the market (Manocha, 2017). It provides a set path to the company in maintaining its
growth and helps in managing the market activities in a proper and effective way. For a start-up
grabbing a 1 percent of market share in such a small time is really an aspect which is influential.
It could be suggested that Fat Lama should indulge in the strategies with the effect of which it
could expand its business and could ensure acquire a huge market share.
Revenue Generation
Net Revenue of Fat Lama tracked is $21k with $80k in the booking value. Cofounders of the
company are planning to launch the business in San Francisco and New York in near future
(Pargaonkar, 2016).
Competition
Fat Lama is a start-up which is different and new as it is providing a set platform to the
customers where they can share their belongings with others and apply the rental charges on
them. In short, the company is availing business to the customers available in the market and is
helping them in managing their living. The concept is new and attractive and there is no
competition available so it creates an opportunity for the growth of the company with the effect
of which it could sustain in the market.
Regulatory Restrictions
According to Fair Trade Act, it is necessary that Fat Lama should ensure to provide the services
which are fair. Providing fair information will help in maintaining the decorum of the market and
goodwill of the company.
It is necessary that data should remain protected and confidentiality should be maintained by the
company. Fat Lama should use the personal information of the customers for business purposes
only and the information should be shared with the authenticated and authorized people only
(Wagner, 2012).
10

MARKETING STRATEGIES
Overall Objectives and Strategies
One of the main objectives of Fat Lama is to create the importance and effectiveness of sharing
among the people living in the UK.
The company wants to develop a platform which could help the society in which both, the person
wants to share the belonging and the person wants to take the belonging on rent could get
benefitted (Stoutenburg, 2015).
The company aims at saving the time of the people. With the help of service provided by the
company, people available in the market could rent the goods and services just by making
several clicks which will help them in saving their time and managing their day to day life in a
more appropriate way.
Customer Focus
Fat Lama is a company which remains indulged in the practices of adopting new strategies which
will help the company in managing the customers and will provide a set path for growth. The
company has a tendency to provide a huge scope of growth to its customers (Rousek, 2010). It
ensures that fair deals could take place by spending minimum cost. Hence, it could be evaluated
that Fat Lama is a company which focuses on its customers and take care of them which helps in
ensuring that the value chain could be maintained and feeling of sharing could be developed
among the target customers available in the market.
Laboratory Focus
Customer focus is one of the aspects which remain attached to the company with which company
prefers to focus on the strategies and innovation. Fat Lama is a start-up which requires that it
should remain indulged in the practices of adopting some of the other new strategies with the
effect of which growth of the company could be managed so that competitive advantage could be
gained by the company (Crunch Base, 2017).
11

12