23A – Your Venture’s Unfair Advantage
1. Human capital of knowledge of sales. I have had many jobs, and with each one I have gained valuable knowledge on how to sale things. This ranges from when I was a waiter at a restaurant and I had to try to upsell the daily specials or drink options, or my job as a lifeguard when I have to contact local summer camps to convince them to come to our pool instead of others. I feel like this sales knowledge will help me approach Gainesville restaurants and sell my service and products. This is valuable because I could sell my product. It is not rare because a lot of people can sale stuff, which makes it inimitable.
2. I have been saving and investing money since I was a small child, and looking at prices from Alibaba I could afford around 350,000 bamboo straws. This could give me the start up capital to sell directly to restaurants and fulfill orders instantly instead of waiting for shipping.
3. I drive a big SUV, so I can deliver straws myself in bulk to restaurants.
4. My friends rent a house in Gainesville with a big garage, and told me if I needed to start the business, I could store the 350,000 straws at their place, and wouldn’t charge me rent for the first three months to see if my idea would take off.
5. I eat at many restaurants and go to many small coffee places, where a lot of the employees and managers know me, so I could use that social capital and connections to initiate sales.
6. For capabilities of the distributing center it would start small, the pricing for packs of 1,000 bamboo straws are 0.03 a piece, but it does specify there are discounts and incentives for bulk quantities and purchases. Even assuming I buy for the full price of 0.03 and sell for 0.06 a piece to restaurants, selling the whole initial stockpile would result in a $10,500 profit before taxes. Since straws are small, I would be able to keep a lot in my SUV and fir the rest in either my apartment or friends’ garage. I would say this low overhead is definitely a resource because I would not even have to hirer a staff or rent office space.
7. My organizational culture would push environmentalism as a image, so that companies could advertise they are environmentally friendly. I would try to keep myself always open to order requests and work with companies that need help fulfilling their orders. There are many different products I could offer including customized stainless-steel straws, paper straws, bamboo straws and grass straws. There are even more type of straws I could offer, but would limit it to these products to keep inventory smaller, unless special requests are made by customers.
8. Another resource I would say I have is knowledge for purchasing bulk orders on Alibaba. With trade embargos, it could be difficult getting items through customs, but I have been working with my network to learn ways to help getting products through.
9. Another resource I have is my friend works with Spoon University, which is a popular blog for restaurants around college campuses, and frequently has restaurants reach out to her to write articles and reviews on them. She said she can work with me to reach out and use her social capital to get sales.
10. A last resource I have is that I am a finance major, and have the knowledge to do the financial for this, such as registering as a company and set up taxes and stuff for it.
I would say my most valuable resource is the fact I will have such low overhead. Many businesses do not last because they go bankrupt before they can make a profit. I already own a big SUV that can make deliveries, and have my own room for storage that I would not have to rent additional space. The only initial cost would be the first purchase of straws for the stockpile. I feel this is so valuable and more important than my other resources because it shows my business is practical and low cost to operate.
2. I have been saving and investing money since I was a small child, and looking at prices from Alibaba I could afford around 350,000 bamboo straws. This could give me the start up capital to sell directly to restaurants and fulfill orders instantly instead of waiting for shipping.
3. I drive a big SUV, so I can deliver straws myself in bulk to restaurants.
4. My friends rent a house in Gainesville with a big garage, and told me if I needed to start the business, I could store the 350,000 straws at their place, and wouldn’t charge me rent for the first three months to see if my idea would take off.
5. I eat at many restaurants and go to many small coffee places, where a lot of the employees and managers know me, so I could use that social capital and connections to initiate sales.
6. For capabilities of the distributing center it would start small, the pricing for packs of 1,000 bamboo straws are 0.03 a piece, but it does specify there are discounts and incentives for bulk quantities and purchases. Even assuming I buy for the full price of 0.03 and sell for 0.06 a piece to restaurants, selling the whole initial stockpile would result in a $10,500 profit before taxes. Since straws are small, I would be able to keep a lot in my SUV and fir the rest in either my apartment or friends’ garage. I would say this low overhead is definitely a resource because I would not even have to hirer a staff or rent office space.
7. My organizational culture would push environmentalism as a image, so that companies could advertise they are environmentally friendly. I would try to keep myself always open to order requests and work with companies that need help fulfilling their orders. There are many different products I could offer including customized stainless-steel straws, paper straws, bamboo straws and grass straws. There are even more type of straws I could offer, but would limit it to these products to keep inventory smaller, unless special requests are made by customers.
8. Another resource I would say I have is knowledge for purchasing bulk orders on Alibaba. With trade embargos, it could be difficult getting items through customs, but I have been working with my network to learn ways to help getting products through.
9. Another resource I have is my friend works with Spoon University, which is a popular blog for restaurants around college campuses, and frequently has restaurants reach out to her to write articles and reviews on them. She said she can work with me to reach out and use her social capital to get sales.
10. A last resource I have is that I am a finance major, and have the knowledge to do the financial for this, such as registering as a company and set up taxes and stuff for it.
I would say my most valuable resource is the fact I will have such low overhead. Many businesses do not last because they go bankrupt before they can make a profit. I already own a big SUV that can make deliveries, and have my own room for storage that I would not have to rent additional space. The only initial cost would be the first purchase of straws for the stockpile. I feel this is so valuable and more important than my other resources because it shows my business is practical and low cost to operate.
Dear Matthew,
ReplyDeleteI agree that your human capital and knowledge of sales can be a very valuable asset and an unfair advantage. This is because sales are the driving force in any business. Your product can be very good, but if you do not know how to sell, it could lead to nowhere. However, it is smart to say that one of your most valuable resources would be or is low overhead.
Dear Mathew,
ReplyDeleteFirst, I thought this was a great post. Second, I agree with you on saying your most valuable asset is your low overhead. high overhead costs is a huge reason many small or new businesses fail so i think that is great that this business would have a ow overhead cost. also i think its very valuable that you are a finance major and are willing to do some of the accounting and tax work for this venture.