Tresses Glow: Business Plan & Environmental Analysis - UK Startup

This report presents a business plan for 'Tresses Glow,' a startup focused on natural and organic hair care products in the UK. It identifies the partnership business structure as the most suitable and analyzes the macro environment using PESTEL (Political, Economic, Social, Technological, Environmental, and Legal) factors, including the impact of Brexit and COVID-19. The micro environment is assessed using Porter's Five Forces, highlighting competition, consumer bargaining power, and supplier power. The plan includes a market analysis targeting Millennial and Gen Z audiences, outlining marketing and sales strategies, financial needs, and operational approaches, with a focus on sustainability and organic products. The report concludes by emphasizing the importance of understanding both external and internal environments for the success of a new enterprise.

Introduction to
business

Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Different types of Businesses.................................................................................................1
Business structure of the enterprise........................................................................................1
Macro environment................................................................................................................1
Micro environment.................................................................................................................3
Impact on business.................................................................................................................4
o Business Proposal Plan...........................................................................................................4
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Building a new entrepreneurial venture is a risky task as it involves understanding the
external and internal environment of the company to take appropriate action for continuous
success of the firm. A new enterprise which offers organic and natural hair care products which
help consumer gain healthy hair. The name of the enterprise will be Tresses Glow. This report
recognizes different type of business and identifies the type of business start-up. In addition to
the macro environment of the company is analysed by the usage of appropriate business models.
The impact of macro and micro environment is also included in this report.
MAIN BODY
Different types of Businesses
o Sole proprietorship: This type of business structure involves creating an enterprise under
own name and conducting business operations under own name (Marchet and et. al., 2018).
The liabilities and assists are fully gained by the single owner of the company. The
advantage is that it helps quick creation of an enterprise while the disadvantage is the huge
risk.
o Limited Liability Partnership; A limited liability partnership is a separate legal entity from
its members (partners), who are only liable for the amount of money they invest, plus any
personal guarantees. The advantage of LLP is that it is convenient and has minimum capital
requirement while the disadvantage is that it leads to public disclosure.
o Partnership: This involves formation of an agreement between two individuals to create an
enterprise through equal investment and responsibility. This type of business structure
provides advantage of resources and knowledge from partners while reduction in control of
the enterprise (Wu, Zhang and Tang, 2020).
Business structure of the enterprise
The business structure for Tresses Glow will be Partnership because it reduces the risk of
financial investment and knowledge from like-minded entrepreneurs can increase the possibility
of success of the enterprise. In addition to this financial capital can also be gained by forming
partnership with investors.
1

Macro environment
PESTEL analysis
 Political Factor: Brexit is the primary political factor impacting start-up organizations in
UK. This is because it means introduction of new tariff regulations and business regulations
while importing or exporting goods from UK. Small business firms and start-up
organizations have to cope with such changes and regulatory impact of Brexit.
Positive Impact: The competition from EU businesses will reduce in UK market which I
beneficial for regional growth of UK based start-ups such as Tresses Glow.
Negative Impact: The labour shortage created because of free movement restrictions created by
Brexit will introduce financial difficulties for start-up firms.
 Economical Factor: COVID-19 has affected global supply chain and reduces economic
health of different countries including UK (Papadopoulos, Baltas and Balta, 2020). This will
impact start-up enterprises such as Tresses Glow.
Positive Impact: The vaccination roll outs in UK along with better performance of UK in
recovering from COVID-19 in comparison to other countries will be beneficial for financial
growth of UK based start-ups.
Negative Impact: The negative impact of COVID-19 on consumer confidence as well as
purchasing power of consumers will negatively affect success of start-up firms.
 Social Factor: The focus of consumers towards purchasing beauty and wellness products has
increased in the pandemic. This can be seen from the data as the sale of hair colouring
products increased by 172% in comparison to previous year (How COVID-19 hit the beauty
market, 2021).
Positive Impact: Tresses Glow can use the trend of self-care and focus on wellness to gain loyal
consumer base quickly.
Negative Impact: This has increased competition in the cosmetics and beauty industry as small
scale firms are selling home made products on website such as Etsy.
 Technological Factor: COVID-19 boosted the e-commerce and online shopping. This
enables small firms to quickly establish a consumer base by creating trusted e-commerce
brand.
Positive Impact: The opportunity created by rise of e-commerce for small start-ups is huge
because less time is needed to build e-commerce audience across the globe.
2

Negative Impact: Reaching to consumers through e-commerce requires investment in
advertisement and also introduces the threat of cyber crime such as online financial frauds.
 Environmental Factor: The trend of purchasing organic and natural beauty and wellness
products affects start-up firms in this industry to reduce environmental damage and enhance
responsible shopping is increasing.
Positive Impact: The Tresses Glow can gain popularity and consumer attention through their
organic and natural product line.
Negative Impact: The cost of producing natural and organic products is high.
 Legal Factor: The requirements for starting a new business is not very complicated in United
Kingdom. The ease of doing business index in UK places the country at 83.5 with a core of
94.6 in case of starting an enterprise (United Kingdom, 2021). This showcases that the legal
procedures and costs associated with starting a business in UK is easy which supports
growth of small enterprises.
Positive Impact: In context of the hair care company Tresses Glow this supports quickly
creating an enterprise.
Negative Impact: The negative impact with high ease of doing bossiness ranking in UK is that it
can increase competition in the hair care industry.
Micro environment
Porter’s Five Forces Analysis Intensity of competition: The intensity of competition in the hair care industry is high. The
reason behind this is that there are different regional as well international rival who of hair
care product such as Treseme, Pantene, L’Oreal, Head and Shoulders, Matrix, Yves Rocher
and Grainier. In addition to this Supermarket such as M&S also offer their own brand hair
care product which increases competition in the industry. Bargaining Power of Consumers: This element of Porter’s five forces analysis helps
understand the ability of consumers to influence the price of a product (Musonera, 2018).
The price sensitivity of consumers in context of the hair care industry is high. This is
because there are various alternative as well as substitute products available to consumer.
This makes the bargaining power high.
 Bargaining Power of suppliers: The power of supplier to impact on prices is showcased in
this part of the model. In the hair care industry basic product and packaging material can be
3

gained through large number of suppliers at low price with high quality. This reduces the
power of suppliers in the industry and makes it low.
 Threat of Substitute Products: The availability of alternative products which complete the
same purpose I referred to ass threat posed by alternative substances. The threat of substitute
products in case of hair care industry is moderate. This is because while there are
homemade alternative to hair care a well-made and effective product for specific hair
conditions of consumers does not have perfect alternative.
 Threat of new entrants: Various entry barriers such as legal requirements and cost of start-
up affect new business firs from entering the industry. The threat of new entrants in case of
the hair care industry is low (Irfan and et. al., 2019). This is because high investment is
needed to gain credibility as a hair product brand.
Impact on business
The external environment as well as competitive landscape of the hair care industry
impact on the possibility of success of the new enterprise Tresses Glow. The external
environment provides opportunities in the rise of ecommerce as well as threats such as the
economic downfall affecting consumer purchasing power negatively. The competitive landscape
in the hair care industry is harsh and requires high investment to maintain competitive
positioning in the industry.
o Business Proposal Plan
Business Overview:
Type of business and name? Tresses Glow
Partnership
Products and services of the
business?
Natural and Organic Hair care products
Which theory or model
would you like to briefly
add in to your business?
PESTEL
Market Analysis:
4

Who will buy your product
and services? (Target
Audience)
Millennial and Gen Z audience
How will they benefit from
your product and services?
Sustainability and organic solutions for hair conditions.
What is your mission
statement?
To provide sustainable hair care products affordable for everyone.
Who are your competitors? Tresseme L’Oreal
Why your business will be
better than your
competitors?
Better Sustainability
Marketing and Sales Plan:
How will your customers
learn about your business?
The consumers will be able to lean about the business through social
media email advertisements and collaboration with beauty influencers.
How you’ll encourage
customers to tell others
about your business?
This can be completed through email marketing and by offering
discounts on increasing social media engagement with brand.
How much capital do you
need and briefly why?
The capital needed is 1000,000 GBP to purchase raw material, packaging
material, human resources and create marketing campaigns.
What are your plans for
promotions and offers?
Social media promotions as well as seasonal discounts will be used to
attract consumers
How will you operate your
products and services to
your customers?
Sustainability and organic nature of the products will be used to operate
to target consumer base.
Finally, what are your 3
goals of successful business
for your customers?
 To provide consumers positive brand experience
 To improve consumer journey at every point.
 To enhance consumer communication after sale
5

CONCLUSION
From the above report I can be concluded that merits and demerits of different business
structures need to be understood in order to adopt appropriate business structure for the
company. Sole proprietorship, partnership and limited liability partnership can be adopted by
business firms to start a new enterprise. The external environment of an enterprise can be
understood through application of PESTEL analysis while the internal environment of an
industry can be determined by using Porter’ five forces analysis. The too business analysis tool
hep understand the impact of various forces on a start-up and take action for quick growth of the
company.
6

REFERENCES
Books and Journals
Papadopoulos, T., Baltas, K. N. and Balta, M. E., 2020. The use of digital technologies by small
and medium enterprises during COVID-19: Implications for theory and practice. International
Journal of Information Management, 55. p.102192.
Marchet and et. al., 2018. Business logistics models in omni-channel: a classification framework
and empirical analysis. International Journal of Physical Distribution & Logistics Management.
Wu, S., Zhang, L. and Tang, R., 2020, September. Energy Format and Classification Based on
Format Summary. In Journal of Physics: Conference Series (Vol. 1649, No. 1, p. 012018). IOP
Publishing.
Irfan and et. al., 2019. Competitive assessment of Indian wind power industry: A five forces
model. Journal of Renewable and Sustainable Energy, 11(6). p.063301.
Musonera, E., 2018. Instagram: A photo sharing application. Journal of the International
Academy for Case Studies, 24(4). pp.1-9.
Online
How COVID-19 hit the beauty market, 2021. [Online] Available through
<https://www.nutritionaloutlook.com/view/how-covid-19-hit-the-beauty-market>
United Kingdom, 2021. [Online] Available through
<https://www.doingbusiness.org/en/data/exploreeconomies/united-kingdom#DB_sb>
7