Munch Box: Analysis of Entrepreneurial Opportunities in Food Delivery

This report analyzes the entrepreneurial opportunities for Munch Box, an online food delivery startup. It begins by identifying different sources of entrepreneurial ideas, focusing on Ducker's seven sources of innovation, and then explores the application of Porter's Five Forces model for gap analysis within the online food delivery market. The report includes primary and secondary data to evaluate market potential, including survey results and industry statistics, and interprets the data to assess market viability and growth prospects. Furthermore, it incorporates a SWOT analysis to evaluate the internal strengths and weaknesses of Munch Box, as well as external opportunities and threats. The report also examines internal and external factors affecting the business, concluding with insights into the competitive landscape and strategies for success in the dynamic food delivery sector.

Identifying Entrepreneurial
Opportunities

Index
INTRODUCTION...........................................................................................................................3
Task 1...............................................................................................................................................3
P1. Different sources of entrepreneurial idea: .......................................................................3
Task 2...............................................................................................................................................4
P2. Tools and techniques used for gap analysis:....................................................................4
Task 3...............................................................................................................................................5
P3. Data collected for evaluation of the market potential:.....................................................5
P4. Interpretation of the data to analyse the market potential :............................................10
Task 4.............................................................................................................................................12
P5.SWOT Analysis: ............................................................................................................12
P6. Internal and External factors affecting the business................................................................13
CONCLUSION..............................................................................................................................15
REFERENCES..............................................................................................................................16

INTRODUCTION
Entrepreneurial opportunity can be defined as the situation where products and services can be
sold at the greater price which is more than actual price. These opportunities consist of future
oriented action. Present study will lay emphasis on a factious company known as Munch Box. It
is a new start-up done by entrepreneurs. It is an online food delivering company. Firm has a
vision of providing about 300 jobs in UK. Report will lay emphasis on different source of
entrepreneurial ideas and innovation. Study will also provide rationale and the market gap for
specific entrepreneurial idea using specific tools and techniques. It further lays emphasis on
competitive and market environment that can affect business.
Task 1
P1. Different sources of entrepreneurial idea:
The company name is munch box and we are providing an online food delivery service .
Ducker's 7 sources of innovative opportunity:
Unexpected:
According to the NPD delivery will grow by 17 % in the coming years. Over the past few years
the delivery market has boost up from sterling 2.4 billion. The foods which were recorded as the
favourite food in UK is Chinese, pizza, burgers and curry(Anderson and et.al., 2016).
As with the delivery service provides people reliability, reduce their transport expense, also
provide additional services thus people prefer to buy food online. The possible reason for the
failure of the business can be bad past experiences of the customers.
Incongruity: there is still a gap as many of the people are not aware about the use of the service
and the advantages of the service.
Process needs: In order to improve the business the company should provide rewards and cash
backs to the customers as this is the best strategy to attract the customers.
Change in industry and market structure:the restaurant are now providing the online service also
there is a rapid change in the business of restaurant. It was found that about
there is huge competition in the market as it was found that in year 2017 about 14.04 million
restaurant has started consumer delivery and it was expected to grow by 24.25 million by 2023.
Demographics : as the need and the preferences of the people changes as the innovation came or
change in the market trend. The statics shows that the people of the age between 25-34 prefer the

online food (Hartsfield, Johansen 2017). In the study it was find that the women are more likely
to buy online food.
Change in perception, Mood or meaning: the online food delivery has changes view of people.
the people earlier used to go to the restaurant to have their meal but with an invent on online
delivery people now prefer to order the food so that they can save their time and money.
New knowledge: the new technologies are helping the companies to know the customer buying
habits and their preferences. The technology made it easy for the business as well as customer to
interact. It helps the consumer to plan ahead with the help of various applications it becomes
easier for customer to track their meals and for the safe payment.
Looking to the statistics it can be concluded that there is wide scope in the business.
Task 2
P2. Tools and techniques used for gap analysis:
Porters five forces model:
Threat of new entrants: The threat of new entrant in the market is high because the cost involved
is low for the restaurant who are already well settled the online delivery service for them act as a
medium to earn more profit. The all a company need to start a online business is to have a good
operation team and only a initial amount is required to start an online delivery business(Boling,
Pieper, and Covin, 2016). And with the advent of the technology reaching to the customers,
understanding there needs and giving service accordingly has created a less risk of entering in
the industry.
Bargaining power of suppliers: the bargaining power of the suppliers is low as the need of the
online delivery business is a food parcel which they can get from any of the restaurants as
selected or not selected by the customer from the listed restaurants on their mobile applications.
Since there is huge number of suppliers in the industry pricing plays an important role in order to
gain the market share.
Bargaining power of buyers: Bargaining power of buyer is high as with the use of various
devices and internet customer can easily check the prices of other companies in the same field.
As the customer want the fast service at a reasonable rate so the factor of brand loyalty is not
high. In order to gain the brand loyalty and attract the new customers the cashback and discount
offers have to be offered(Eshima, Anderson, 2017). The other tactics which can be used to get
more and more customers are cash on delivery, cheap price, cash on delivery etc.

Threat of substitute: there is no such threat to the food industry. The need of the customer is food
and there are various alternatives present in the market it can be food stalls, restaurants of nearby
location etc. depending on the need the customer can take action accordingly as the delivery
takes time on an average of 30 minutes, in case of urgency customer can switch to other
alternatives. But as the customer prefer online delivery as they feel more comfortable in homes
and enjoying their meal with family, reduce transportation cost.
From the above it can be considered that the threat of substitute is moderate.
Rivalry among existing competitors: the competitors are high as the food industry as the online
delivery business is growing day by day every restaurant now start providing online delivery
services and many online devilry company has also come into the market. Switching cost is also
high as there are many other company in the same service. So it can be said that the rivalry
among the existing firm is high.
The porter five forces helps to analyse the current trend in the online food business and identifies
the prevailing market opportunities. And it shows the potential of the customer as well as
suppliers. The model also help in analysing the key players in the market, application areas,
market segmentation and give an idea of growth strategies to be adapted.
Task 3
P3. Data collected for evaluation of the market potential:
In order to evaluate the market potential both time of data i.e., secondary as well as primary data
has been used. Secondary data such as government statistics, market research report, and
industry association which is a website having the full information about the industry have been
used. And for the primary data surveys is used in which we conducted a survey of 10 potential
consumers in order to know about the perception of the customers toward online food ordering.
Questionaries’
Name:
Age:
Gender:
1. How often do you order food line?
 Always
 Rarely
 Sometimes

2. What according to you is the best part of online food ordering?
 Wide range of choice
 Time
 Discounts
3. By which medium do you order online food?
 Food Websites
 Restaurant websites
 Mobile application
4. Do you feel buyers have limited choice of restaurants when ordering food online?
 Yes
 May be
 No
5. What according to you we can improve in venture?
 Online payment system
 Restaurant choices
 Geographical reach
Theme 1: Majority of consumer order food sometimes
1. How often do you order food line? Frequency
Always 4
Rarely 1
Sometimes 5

Theme 2: Discounts is the best part of online food ordering
2. What according to you is the best part of online food ordering? Frequency
Wide range of choice 2
Time 2
Discounts 6
Theme 3: Majority of consumer order online food via Mobile application
3. By which medium do you order online food? Frequency
Food Websites 4
Restaurant websites 1
Mobile application 5

Theme 4: Yes, majority of consumer feel buyers have limited choice of restaurants when
ordering food online
4. Do you feel buyers have limited choice of restaurants when ordering food
online? Frequency
Yes 5
May be 3
No 2

Theme 5: As per majority respondent Restaurant choices is the improvement which can be
managed in new venture
5. What according to you we can improve in venture? Frequency
Online payment system 2
Restaurant choices 4
Geographical reach 3
According to the statistics of the digital buyer, it was found that about US$ 3,810m is
the revenue of the online food delivery in 2019 and it is expected that the revenue will grow at
the rate of 9.0% annually which will grow by US$ 5,382 m by 2023(Wales and et.al., 2019).
The market value of the online food delivery is about US$ 2,721m.
According to the NDP group it is expected that the business will grow by 17% in next 2 years.
The facts found about the food delivery business is:
 It was found that about 46% order is done by phones in which about 38% is done through
online and 16% is done by the use of mobile application. But it is expected that the order
through mobile application will increase in the coming 2 years.
 Burgers are most ordered food in UK which make up 60% of deliveries in year 2017 as
compared to 2016.
 Pizza has shown dropped in its percentage from 2016 to 2017 as customer want pizza to
be hot but due to the delivery time they did not get the expected delivery.

The millennial are the main reason behind the success of the food delivery business as they
spend most of their earning on the ordering of food in comparison to any other generation. As the
Nigel Travis, CEO of Dunkin Brands says “ I think millennial generation is much more
demanding than prior generations”.
Delivery through use of augmented and virtual reality: Companies are using AR and VR in order
to create the brand awareness, boost sales etc.
P4. Interpretation of the data to analyse the market potential :
By analysing all the data it was found that the scope in the online food delivery is high, as
many of the millennial prefer ordering of food as most of them are the young professionals so
they find it better to order food online rather than cooking by themselves.
By the research on it was found that for the last few years it is seen that online food
ordering is increasing. As it provide a large number of food items to the customers. One of the
major advantage of food industry is that it incur low labour cost as the customer does not want to
stick to the counter. And also the ordering food online provides the company an information
about the customer which can be used to design a marketing strategies as the ordering is done
through various websites and mobile application which demand for personal details. It also helps
the company to estimate the delivery time and gives response to the complaints. According to the
survey which have been conducted it was found that majority of customers order food
sometimes. Discounts offered help in gaining the customer attraction. According to the survey it
was found that many of the people buy online food. One of the main limitation in buying online
food is limited options available for ordering food. It was found that geographical reach will help
in the improvement of munch box.
It can also be seen from the data collected that the taste of preferences of the people has also
changed as the online ordering of food provide a huge number of alternatives to the customer
which includes various types of cuisines such as chinese, italian etc therefore it one of the reason
in the growth of the food industry.
As with the online food delivery option it has become easier for the customer to get food with the
help of food outlets it has become easier to get the food throughout the day(van Doorn, Heyden
2017).

It provides convenience to the customers as customer can order food with many of the mobile
application. The all needed is to provide a discount and offers to the customer in order to
increase brand loyalty.
The data collected shows the various opportunities for the online food delivery business :1. Consumer segmentation: The millennial and women are the main target of the online
food delivery.2. Purchase situational analysis: food is the basic necessity of life and there is not a single
day when the business has to suffer loss because most of the people who are working
tend to order food online(Lomberg, and et.al., 2017). The peak time for the business is
during festive season.3. Direct competition analysis: As it can be seen that there is no entry barrier as the low
investment is needed to enter into the online food delivery business as a result there is
large number of competitors in the market. In the food industry the online delivery
services is taking a huge market share many restaurants are entering into the business.
But as our company has come up with an idea of providing food services at low cost
without the additional charges and to provide the attractive cash back and discounts to
attract the customer. We provide more 50+ cuisines to the customers and the dishes in
themselves has a variety. We will provide a good quality of service to our customer and
are services are customized. We also take order of birthday cakes with additional services
included such as providing gifts and cards along with the cake.
4. Analysis of complementary services: In order to attract the customer various
complementary services are provided to the customers. Many companies provide
complementary food and drinks , gift vouchers, cashback etc. the new trend in the market
is the customer prefer those online service which provide them cashback therefore this is
the best way to attract the customer(Lumpkin, and Dess, 2015).
According to the study it was found that now a days people prefer to buy online food(Wessel, G.,
Ziemkiewicz, C. and Sauda, E., 2016). Therefore in order to achieve success in the market the
munch box should focus on improving its online services such as payment system. In order to
avoid any type of delay in delivering the company should also focus of providing food delivery
on time. In order to strengthen the customer base the company should actively manage and

monitor the customer care platform. The company should focus on online platform more and
should try to make its services more efficient.
Task 4
P5.SWOT Analysis:
For analysing the market of the online food delivery the swot analysis is done of the
entrepreneurial idea.
Strength: Wider Scope: As online food delivery industry is growing sector in the UK there is a
good scope of growth in future for Munch Box in this sector, as per the report in 2018 440
million US dollar revenue has been increase of an online food delivery companies in the past one
year.
Client Relationship: Munch Box can offer food to customer at a cheaper rate by cutting down the
rate of the food by making exclusive partnership with outlet owner in UK just like Deliveroo.
Capital Requirement: This industry will require less fixed capital as compare to the other
industry as there will be no production of good in this industry so no requirement of machinery.
Weakness:
Requirement of man power: In this industry requirement of man power is very high as compare
to other service providing company as food need to be deliver at any place in the city within a
specific time so that food does not get spoil or damage otherwise it creates a wrong impression
of organisation in the eye of the customer and will surely spoil the company goodwill in the
market.
Over dependency on Technology: In these type of industry there is over dependency on
technology to run day to day business as without technology it will be very difficult for customer
to approach Munch Box and it may result in the heavy losses for the firm.
Opportunities:
Eating trend: As nowadays fast food eating trend is growing in the UK there are good
opportunities for Munch Box to cover a good market area, There are customer who are ordering
the food online at regular basis as they feel it more convenient way as compare to cook the food
at home.
New working relationship: There are many restaurants and food outlets which are still not
contacted by any of the competitor in the market, Munch Box can have a working relationship

with those type of outlet as it will help to Munch Box to offer more to their customer and will
also help in growing customer base in the wide market.
Threats:
Competition: Munch Box may be affected by the competition offered by the others company in
this industry. Competition is growing rapidly as many new company are entering into this
industry some example are Delivroo, Uber eat, Justeat and Hungry house. As some of these are
well established company they offer their customer food on very cheap rate to attract customer.
Changing food Taste: As food taste used to change in the people at regular interval it may cause
problem to the Munch Box as company need to be ready to adapt the changes in the market. For
e.g. nowadays in UK people are looking to eat more healthy food.
P6. Internal and External factors affecting the business
Pestel analysis
Political factors : There are various political factors which can affect the business of munch box
such as government regulations which affects the online food business are increase in taxes
(External and internal factors affecting business. 2014). If the tax rate is increased on the food
items than it will make adverse impact on the profitability of the online food delivery business.
Thus, a company should be aware about the rules and regulations of the government before
entering in the business.
Environmental factors : Various environmental factors such as change in climate, whether can
also create a threat to the company. Change in climatic condition may cause the company to face
difficulties in transportation and also lack of necessary resources.
Social factors : Social factors such as culture, attitude and belief may affect the working of the
business. For example now a days peoples are getting more concerned about their physical
presence they want to remain fit and healthy and in shape which is putting the pressure on the
restaurants to provide healthy food to customers. The munch box therefore should try to provide
healthy food to the customers.
Technological factors : As the technology is changing rapidly therefore every business is facing
the threat of rapid change of technology. The change in technology can cause a threat to munch
box business as well as it can also provide huge opportunities to the business. As now the people
are more in use of online services therefore it can also act as a opportunity for the company.
Competitor in the market which already done their business in food industry make an huge

impact on the online business. The existing competitors already capture the market and
customer. Munch Box will do the market study of the different online food business and study
their strategies to capture the customer attention.
Economic factors : Various economic factors such as change in inflation rate, exchange rate,
interest rate may affect the food business. The change in economy of the country may affect the
buying behaviour of the customer as well. Suppliers and customer also affect the business.
Suppliers are the person who supply the raw material and goods to the firm and customer are the
end user of the product. Munch Box have to choose some promotional techniques like free
delivery to limited area, offers to the first users, discount on occasion and provide the customer
to tailor made services. These promotional strategy help to capture the attention of the customer.
Legal factors : Various legal factors such as governmental law related to food and safety can
also affect the working of the business. The other legal factors which can affect the working of
munch box are consumer law, health and safety law, fraud law etc. In order to avoid any negative
affect from such factor the company should look on such factors.
Internal Factor which can affect Munch Box:
Management Decision: Decision taken by Internal management is always helpful in the
organisation success but in the case of Munch Box it will be difficult for Munch Box authority to
pass on the decision and to supervise each and every employee in the firm because of large
number of employee working in a firm in different timing shift.
Labour Cost: Labour cost of company working in online food delivery service is always high as
they require huge amount of man power as compare to other service providing company it may
affect the Munch Box profitability because in UK labour rate tend to have a good rise every year,
as per the report wage rate has been increased to 8.21 pounds per hour which was just 7.83
pound per hour in the year 2017.
Discipline: It is very difficult for online food delivery companies to supervise their employee on
discipline bases as they are on to the working field for whole day it may result in decrease in
efficiency of work under Munch Box as without discipline no company can succeed in long run.
The various factors which has been analysed with the help of Pestle analysis shows that there is a
huge opportunity for the business. The munch box should consider all these factors and should
take proper measure to get success in the market.

CONCLUSION
From the above study, it has been summarised that online food delivering system has been rise in
UK sector. Company has been able to set up its business in London. It has also been analysed
from the report that firm has vision of providing job opportunities to number of people. Many
environmental factors have affected growth of company. Firm has also been engaged in
performing activities like Corporate social responsibility, so they can grow easily. Laws, rules
and regulations of different country can affect global growth of organization. They have been
able to gain competitive advantage.

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