Business Development: Feasibility and Risk Management - Foodstuff Shop

This report provides a comprehensive analysis of "Foodstuff to Shop," a new startup business venture focused on providing vegan fusion foods. It details the business idea, emphasizing the growing demand for healthy and tasty dietary options. The report includes a concept statement outlining products, target market, values, and scale, along with an assessment of industry, market, organizational, and financial feasibility. A value chain analysis and business canvas model are presented to understand the company's operations and potential. Furthermore, the report addresses potential risks and proposes management strategies to ensure the startup's long-term survival and profitability within the competitive food retail marketplace.

Entrepreneurship and
business development

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Explain new business idea..........................................................................................................1
Key components of concept statement .......................................................................................2
Appropriate assessment of industry, Market, organisational and Financial Feasibility.............3
Components of value chain.........................................................................................................8
Business canvas model................................................................................................................9
In what manner potential risk could be managed......................................................................10
CONCLUSION .............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Entrepreneurship defined as a creation of value. It reflected as change that is generated to
maintain survival of business. An entrepreneur is an individual person who emphasis on
developing new business by bearing most of the risk to enjoy high profitable results within
marketplace (Aljuwaiber, 2020). An entrepreneur within an organisation represented as an
innovator who source new ideas, services, goods and businesses etc. A particular report is based
on a new start up business i.e. “Foodstuff to shop”. It is a kind to retail business platform where
an entrepreneur attracts customers via their vegan fusion foods that is fusion of taste and health.
In recent environment, people are highly emphasis on buying good and services that are highly
healthy and tasty. Due to this, an entrepreneur operate their start up using organic ingredients. To
effectively understand start up firm this report involves explanation of new business idea along
with description of products and services, location, values, features, scale of new proposed
business etc. It also involves financial feasibility, business canvas model, value chain analysis
that helps to understand company so that it would generate more profitable results. Using risk
management model this report emphasis on managing potential risk so that new start-up would
be survive for longer time period within marketplace.
MAIN BODY
Explain new business idea
An entrepreneur start a new business venture i.e. foodstuff to shop where they sell all
kinds of foods products to customers which are healthy and effective for people health. The main
reason behind the establishment of new business venture is to generate health within people.
Now a days people are highly conscious about their health and does not invest their income to
buy junk food. Although they are also emphasis on dietary products that are also tasty as Junk
food (Duan and Sandhu, 2021). To fulfil the demands of customers, an entrepreneur initiate to
launch a new start-up organisation where they offer organic and vegan food meal to customers
that is a fusion of health and taste. They attracts customers via online and offline medium by
operating business on e-platform also. The new start-up is based on food retailing market
because people are highly emphasis on their health and safety. This helps to gain more profitable
results within marketplace. Therefore, while operating the business “Foodstuff to shop” several
things were faced by an entrepreneur like face difficulty in arranging funds and implement a
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prominent position in food retail marketplace because there are number of competitors present in
market who are deal in food retailing business. Hence, by satisfying the demands of customers
entrepreneurs adopts their vegan fusion food meal that is one of the best trend in current
marketplace.
Key components of concept statement
Product and services
The product that were offered to the customers by start-up venture is of vegan food
products range that is highly healthy for people who are conscious about their health and want to
improve the dietary habits (Ferreras-Garcia, Hernández-Lara and Serradell-López, 2020). This
food product range offer fusion products such as healthy burger that is made with Sorghum bread
and healthy veggies with vegan sauce that all the sustainable material that offer natural benefits
to the health of individual person who adopts the use of these products.
Target market
The target market of this new venture is mainly the middle class people who are highly
emphasis on consuming health and organic products.
Special attributes
Sustainable and organic packaging of food material are mainly used to deliver the
products to customers (Galvão and et. al., 2020). This is a kind of special attributes of products
that are mainly offered by Foodstuff to shop that is new start-up venture at their shop. Hence, it
offer customers sustainable and affordable options for healthy and tasty meals.
Values
The company values the customer perception as they highly emphasis on health. To fulfil
all their requirements company deliver quality and quality food products at the price friendly.
Venture also make honest relation with customers in relation to sell their goods to them.
Scale of newly proposed business
It is a type of medium size business where large amount of investment are contributed by
organisation to develop organic or vegan foodstuff. Thus, investment within improving the scale
of venture could develops high financial risk. Therefore medium size scale firm will mainly
emphasis on limiting the financial risk that also support business to offer sustainable products to
the people.
Location
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The organic food products are mainly sold by the company at those areas of London
where high crowd is existed. Although company also sell their products by using online website
and e-commerce websites.
Who are involved
In this business several stakeholders are involved such as employees, suppliers,
customers and investors.
Appropriate assessment of industry, Market, organisational and Financial Feasibility
Industry feasibility
The organic market of UK is highly worthy after examine 12.6 % growth in sales within
2020. This organic market is highly reached to their prominent peak in last 15 years. Since 2020
around more than £50 m per week were spent highly on purchase of organic drink and foods. AS
uncertain crises was occur in 2020 i.e. COVID 19 due to which companies supply chain will
highly suffer but at this time many people turn to purchase organic products for assurance of
integrity, occurrence and quality they offer. However, due to online market, sale of organic
goods are enhance by 36.2% that is highly beneficial to maintain profits and sales even in
COVID 19 situation (Organic Food Retailing in the UK - Market Research Report, 2021). The
organic food retailing within UK based on £842m market size where 2120 business is working.
Pestle analysis
For Start-up, it is important to examine market and take some effective pointers that are
crucial for growth opportunities which are presented within market for venture. In this terms
firm must includes environmental factors that reflects opportunities that organisation used for
growth. Hence for this, PESTLE analysis is used that are presented below:
 Political factor- In this all aspects that consider political situation of country are taken
into account of this determinant. For new start-up Foodstuff for shop, present political
condition of UK is not highly favourable because of uncertainty present due to Brexit
(Keyhani and Kim, 2020). Since it is officially executed within UK because of this
political uncertainties is maximised due to negotiations with EU. This impose threat for
start-up because uncertain policies refrain enterprise to generate long term plans.
 Economic factor- It relates to economic environment of nation that directly impact
working of Start-up firms. Pandemic trade restrictions affects the growth of start-ups. But
this may maximise online shopping that helps organic food firm to gain profitable results
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by selling online. On the other hand COVID 19 impact negatively on economy of UK as
it affects the growth of food retailing industry.
 Social factor- This factor related to trends, social and cultural frameworks, preferences
etc. have an impact on business venture and their offerings (Kolte, Khandelwal and Jain
2021). As for organic retailing industry, the current UK market started to emphasis on
developing appropriate organic products which are organic, healthier and are price
friendly to customers. This reflects as opportunity for start-up company in terms of
developing offer that satisfy needs of large base of customers.
 Technological factor- The technological advancement that are presently occur in nation
and industry are crucial for Start-ups to operate smoothly and enhance growth. For
organic food venture there are numerous advancement done in relation to artificial
advancement, robotics etc. that help organisation to growth opportunities related to
distribution process.
 Legal factor- All these legislation which are highly prevalent in this industry are
necessary to taken into consideration by new start up of organic foods. For food retailing
sector there are various laws that are used by this sector in UK such as Equality Act 2010
where company ensures that each individual who are capable to buy the goods have an
effective access to same and also workers within business venture get equal opportunities
related to growth and profitability. Therefore these legislations demonstrate an
opportunities to improve organisation practices effectively.
 Environmental factor- it mainly considered the environment and their impact on how
business enterprise manufactures and distribute their goods and services. In UK, there are
lots of concern showcased by government side in terms of protecting the environment
(Kurmanalina and et. al., 2020). Hence it reflects as an opportunity for company in order
to enhance products which are highly related to environment friendly products that does
not damage the environment and customers.
Market feasibility
STP analysis
 Segmentation- The main segmentation aspect used for the new start up company is
based on Psycho graphic segmentation. This creates customer segments as per lifestyle
choices. This segment of consumer is justified for organic food products because in this
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company primary emphasis on sustainable of goods. Apart from this demographic
segment is used for segmenting consumer on middle and high income basis. These buyers
select health organic food products over other company due to their health and safety.
This helps in attaining profitable results within marketplace.
 Targeting- Company targets consumer those emphasis on buy sustainable and affordable
foods products that is also environmental friendly. The customer segment identified by
psycho graphic segmentation. However, in 1 to every 3 years consumer taste and
preferences are changed (Nakaoand Nishide, 2020). Therefore targeting the demographic
segments helps to depict high profitable outcomes in targeting customers who are high
price and health conscious.
 Positioning- The Start up company mainly emphasis on setting the position to generate
more profitable results. As company mainly emphasis on developing organic and
sustainable food products with health and taste fusion as it helps to develop high brand
image within marketplace. Organic fusion food meal is high trendy and new concept
within UK and expressed as unique value proposition of venture. Hence to encourage
consumer towards brand promotional campaigns is used that create awareness regarding
products that fulfill demands and requirements of customers. The organic market is
developed by 12.6% in 2020 along with the market is high on peak to target the £2.9b by
the end of 2k21 (UK organic market hits highest growth level in 15 years, 2021).
Therefore, environment aware position of food products that venture to generate more
prominent position within UK and helps to attract number of customers online and offline
stores.
Market growth strategy
It is very prominent for food retailing start-up venture to emphasis on market growth
strategy. Therefore, for Foodstuff to shop should adopts the penetration strategy where they offer
products and services to customers affordable cost because it develops the sales of offerings so
that company generate more profitable results. Hence, execution of this particular strategy is
useful for organic food retailing brand as it improve market share in UK. Maximise the UK
market share helps business venture to expand in global market effectively along with improving
brand image at marketplace.
Marketing strategy
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Marketing mix for Foodstuff to shop:
 Product- Organic and sustainable range of food products is offered by business venture
that is highly tasty and healthy. Therefore they offer Burger which is made up of sorghum
bread and filling with organic sauce and veggies that are highly healthy for people (Parry,
2020). The company also offer pizza, sandwich, taco, roll with the use of organic
products and for this packaging they use sustainable material such as jute bags that does
not harm the environment.
 Price- Foodstuff to shop adopts the competitive pricing strategy where they sell their
products to customers by comparing the price with competitors who offer similar
products. They mainly target middle class people who are also health conscious but does
not leave the taste for health. This helps in attracti9ng large base of customers within UK
market online and offline outlets.
 Place- The business venture sell their products via online and offline platforms to reach
the vast area customers without high spending of opening offline outlets.
 Promotion- Foodstuff to shop adopts the digital media for promoting goods and services
to customers because digital platforms are highly used by consumers. Although it is also
cost effective to company because by using this business venture reach large market
without high cost investment.
Organisation feasibility
Vision- To attain global success within organic food retailing sector
Mission- To deliver sustainable and affordable organic fusion products that is easily
assessable to people.
Competitor analysis (Porters five forces model)
 Intensity of competition- This aspect aims to identify level of competitive intensity
within industry. The competition in foods and beverage industry is high. UK based food
retailers such as Tesco, Waitrose etc. are present in market that generate high competition
for company (Saxena, 2021). Due to their affordable pricing and attractive products
Foodstuff to shop gain profitable outcomes.
 Bargaining power of suppliers- In food retailing industry bargaining power of suppliers
is low because there are large number of suppliers offer same organic products to firms
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that decreases control of suppliers on company purchasing. This helps to attain more
profitable result.
 Bargaining power of customers- The power of consumer is moderate in food retailing
industry. It is done because if the prices and quality is not match customer satisfaction
then they switch company. In terms of Foodstuff to shop they offer products on penetrate
pricing due to which they attract large base of customers.
 Threats of new entrants- in Food retailing company threat of new entrant is low
because there are number of retailing company who offer quality products to customers
and need high investment. So it is beneficial for Foodstuff to shop to make their high
market position without fear of entry of new entrant.
 Threat of substitute- This element mainly emphasis on threat of substitute products. It
mainly involves alternative products that satisfy consumer requirements. Threat of
substitute products in organic food products is low because fresh veggies and fruits are
best substitute of organic food meals that are highly healthy and tasty.
Financial feasibility
Financial budget
Particular 31/12/21 ($)
Implementing technology cost 1000
Promotional expense 8500
Publicity expense 4000
Catalogues 8800
Training charges 9000
Total Cost 31300
Cash flow statement
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Components of value chain
Primary Activities Inbound logistic involve managing and sourcing of materials from suppliers. Hence,
inbound logistics of food products involves collecting organic food supplements from
responsible suppliers at low cost. This is helpful to maintain quality of products in UK
market. Operations consider convert inputs into finished goods. In terms of organic food products
automated manufacturing plant of producing food will constructed that develops food
products such as bread, sauces etc. In this solar technology is used to provide power of
several plants. Hence, it gives sustainable results to business.
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 Outbound logistics includes delivering of finished offers to customers. It involves
packaging, shipping products etc. in this Foodstuff to Shop collaborate with logistic
providers to outsource warehouse that fulfil outbound transportation requirements
(Zhang, 2020). It is so because third party expertise in transportation and warehousing
due to which food products are deliver to customers on time. Marketing and sales is highly utilised by start-up venture. Foodstuff to shop adopts
digital channels to promote goods to customers. This helps business firm to easily
coordinate with customers and understand their needs so that it could be easily fulfilled
by them.
Support Activities Human resource management is a supporting activity that focuses on offer training,
recruiting, retaining skilled workforce. In terms of Foodstuff to shop, HR manager
merely emphasis on retain employees to maintain sustainability and retain customers for
longer time period with their organic range of food products.
 Technological development is essential support activity that helps to gain competitive
advantage at market and reach last range of customers in small time period. In Foodstuff
to shop, R&D department is mainly responsible for selecting food range for attracting
customers and develops profitability by emphasis on creativity.
Business canvas model
 Consumer segments is a part of business canvas model that define consumer segments
of business venture. The main consumer segment for Foodstuff to shop is on
demographic segment where they target middle class people who buy products according
to price. Consumers who are highly health conscious are also targeted to enhance growth
of business.
 Value proposition is another aspect of business canvas model. In this business start-up
offer their organic food products to customers on affordable price. This generate value of
company in competitive marketplace and it also develops long term survival in
marketplace.
 Revenue streams expressed the direct sale of food products by official website of the
store (Kim and et. al., 2021). E-commerce portals such as Amazon and Swiggy etc. they
distribute their food products to customers and generate more revenues.
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 Channels is another element that involves information about distribution channel.
Foodstuff to Shop adopts adopts the use of sustainable delivery channel that is
environment friendly. Hence it helps to retain consumers prominently.
 Consumer relationship is mainly focused by Foodstuff to shop where they emphasis on
established personalised relation with customers. This helps to retain and attract
customers. It also develop brand image at marketplace.
 Key activities involves daily operations of company that generate value for consumers.
Primary activities includes by Foodstuff to shop are emphasis on developing quality
organic products that are healthy and tasty. In this company contract with responsible
suppliers who supply quality products to company so that more customers are connected.
Apart from all these collaborating with logistic providers to easily ship the products to
buyers is key activities of organisation.
 Key resources involves human resources, automation resources, transportation,
warehousing etc. are used by Foodstuff to Shop at the time of start-up so that company
function smoothly.
 Key partners reflect information about partners. The key partners within foodstuff to
shop are shareholders, suppliers,logistic provider, employees etc.
 Cost structure of Foodstuff to shop is based on acquire human resources and technology
resources to develop producing and delivering plants so that objectives are attained
(Rezazadeh and Nobari, 2018). Therefore logistics and suppliers cost are essential cost
for business venture.
In what manner potential risk could be managed
Risk management model
RISK SEVERITY RESPONSIBILITY MITGATION AND
CONTINGENCY
ACTIONS
SCORE
(out of 10)
Monetary risk High Top managers Analyse essential
milestones and schedules
that clearly present time and
debts which are necessary to
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reach next milestone.
Another proper articulation
of growth path to reach
organisation milestone in
time frame. This remove
financial risk for company.
Commercializ
ation risk
High Owner of business To manage
commercialisation risk
company emphasis on fulfil
customer expectation by
listening their issues and
providing solution to them.
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Patents right
protection
Moderate Legal department To protect the logo, name of
the start up company
company need to emphasis
on indulging intellectual
property rights where they
protect the quality of
organic food range that they
supply to customers
(Nguyen and et. al., 2018)
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Collaboration
risk
Low Leaders To overcome with
collaboration risk company
timely invest in evaluating
needs and requirements of
team members so that issues
will be reduced and
collaboration among
members enhanced.
3
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CONCLUSION
From the above report it is to be concluded that develop an business idea for operating a
new start-ups is very crucial for completion of number of activities. It is more significant to
develop the industry overview for construct a new venture. Further this report define target
market of firm. However, by this report conduct macro analysis by emphasis on PESTLE helps
to gain market variables. In this STP model also used to examine targeted customer base of
organisation. Further this project also demonstrate porter five forces model in organisational
feasibility so that competitive analysis is easily understood. Develop of effective market strategy
and market growth strategy helps organisation to properly advertise goods that is useful to set
future direction of company. In this value chain and business canvas model is also elucidated in
order to examine key essential areas of proposed business venture. Hence it is essential to
recognise potential and formulate risk management strategies in order to gain high success of the
start-up venture in marketplace.
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REFERENCES
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Online
Organic Food Retailing in the UK - Market Research Report, 2021. [Online]. Available through:
<https://www.ibisworld.com/united-kingdom/market-research-reports/organic-food-
retailing-industry/>
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UK organic market hits highest growth level in 15 years, 2021. [Online]. Available through:
<https://www.dairyindustries.com/news/36506/uk-organic-market-hits-highest-growth-
level-in-15-years/>
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