Entrepeneurial Challenge

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Entrepreneurial Challenge Pure Vida Nutrition 2016 Macy Kuhl[pic 2]

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Contents

Section I

Introduction        

Buyer Power        

Supplier Power        

Rivalry, Threat of New Entrants, Substitutes        

Three Generic Strategies        

Conclusion        

Section II

Information Quality        

Databases        

Data Warehouse        

Conclusion        

Works Cited        

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Section I

Introduction

In the many years that I knew my grandfather he passed down to me many things.  One of these life lessons was his love of nutrition.  It is because of him and my inheritance of this Pure Vida Nutrition Group, that I decided to further his legacy and continue running his life’s passion.  This store has been flourishing with many happy and healthy customers for as long as I can remember.  This is partly to do with the fact that my grandfather knew everyone by name, and knew what they needed to help them further their journey to a healthy life.  The fact that I had been around this business most of my life helps me, because my grandfather was not much of a record keeper.  He knew everyone and everything about the business like the back of his hand.

Buyer Power

In the nutrition industry, buyer power is a component that is important to pay attention to.  This is pertinent because many people that are health conscious know that there are many substitutes for one item.  In today’s age it is very easy to find most products for cheaper on websites, like Amazon, than in stores.  In order to combat this fight in the industry I will need to provide many different types of each nutrition enhancer, and possibly implement a rewards program or loyalty club (Baltzan).  If I were to put one of these two ideas into place I would need to have a reward after a customer buys so many products, such as a free item, or a new product that is greatly discounted.  

Supplier Power

Another problem that arises in this industry is supplier power.  If one of the suppliers that I buy from notices that I am buying a large number of one product from them, then they may decide to raise the price of it, which would cause me to pass that new higher price to my customers.  In order to avoid raising my prices I could find several suppliers for each product and switch between them so I could keep my prices low.  I could also buy products in bulk and hopefully get a discount that I could then pass on to my customers.

Rivalry, Threat of New Entrants, Substitutes

There is a lot of rivalry between competitors in the nutrition industry.  This is because there are many places that offer the same products, and customers can also go online and find just about anything they want (Baltzan).  For Pure Vida Nutrition it would be important to keep prices low and carry products that no one else does so my customers would not want to buy anywhere else.  Another risk in the nutrition group is the threat of new entrants.  Anyone could open a nutrition store if they wanted to.  Many companies could sell their products directly to the public and completely bypass the retailors, or they could open their own retail locations to sell their products and others.  Along with the factors that have already been named, there is the threat of substitutes.  As stated before, one major substitute for nutrition shops is the Internet.  To evade the threat of the Internet, Pure Vida Nutrition could offer personalized nutrition planning, weight loss counseling, and organized fitness groups.  With these things, Pure Vida Nutrition could have the upper hand against the Internet.  

        

Three Generic Strategies

The most beneficial strategy, of Porter’s three generic strategies, for Pure Vida Nutrition would be the Focused Strategy (Baltzan).  This would work best for the business because it focuses on those people that are heath conscious, but by using this strategy I could carry both high end products and some products that most everyone could afford.  This would allow me to have customers that vary in product buying, and take business away from those companies that only carry high end, or low end products, and are limiting their sales.

Conclusion

My goal with Pure Vida is to tackle all of these problems that will rise up, and find new ways to combat each problem.  This is important in order to “keep my head above water” and keep the business going.  Taking on each of these problems separately is necessary because if I tried to tackle all of the business problems together, many things may get overlooked.  The goal of this strategy is to keep my grandfather’s legacy alive.

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Section II

Information Quality

At Pure Vida Nutrition Group, high quality information is important.  With the new data system that will be implemented each customer’s information will be recorded, such as their full name, address for shipping needs, phone number for contact, e-mail to update them with sales, and purchase history so we can predict what products they may be interested in.  In order for this information to be viable, it needs to be of high quality.  This means it needs to be accurate, complete, consistent, timely, and unique, the “Five Common Characteristics of High-Quality Information” (Baltzan).  If there is a discrepancy in my data system, the customer may not get the right mail, or if their name is spelled wrong, they may be offended and not come back.  The same goes for e-mail.  If a customer gets a message that has nothing to do with what they usually buy, they may block our emails because they think it is a scam.  If a customer’s information is duplicated somewhere in our system, they may be receiving the same thing multiple times and this may begin to annoy them.  Having high quality information is important when running a customer-based nutrition group.