24A--Venture Concept No. 1

          Three Major Elements: 

1) Opportunity

Once I get my production humming, I intend to spread out into other semi-local communities with the same problem my existing customers have: lack of supply. There is a huge need for high quality, affordable feed that isn't an hour away. I intend to solve this issue by hiring a driver who will help me expand our reach into surrounding counties. I anticipate this window of opportunity will be open for seven to 10 years. There is no doubt the local communities will grown, although potentially at the same incredibly slow rate they're currently at. Currently, my potential customers are driving 35 minutes to an hour away to buy feed, then trucking it back home and fretting trying to keep it dry. I think I could easily increase sales by 30%, but likely more. The pool is almost completely untapped.


2) Innovation

I can also branch out as a vendor. My trucks will already have designated routes. Therefore, I could pick up a couple of contracts to deliver mineral regiments, hay, equipment. There is a significant demand for said services in my tri-county area. I would charge 11 cents per mile, but I could distribute that cost among my customers, giving everyone a better deal. I could also charge different flat rates based on what items are being delivered and offer discounts on recurring and/or bulk orders. I won't be able to calculate prices for those until I own the equipment.

3) Venture Concept

Customers will purchase my goods and services because I am taking virtually all of the hassle out. They no longer need to use their truck, which likely gets horrible fuel mileage and may not be reliable enough for long trips to the store. I am guaranteeing their goods will be in good shape and there on time. I am freeing up significant blocks of time that they can spend shuttling kids to baseball practice or spending time on their many other chores. I can pick up supplier cheaper than they can because I'll be buying in bulk. I think I will devote a certain amount of marketing funds to house calls. I will show up with what they need, ask if they're interested, and retain their address and contact information for my future routes.

Currently, I'm competing with other vendors, not producers, within a 150-mile radius of my location. I'm capturing the customers who don't really want to drive all the way out to my competitor's store.

Packaging, pricing, customer service, and value are everything about my business. They are my niche.

I'm anticipating hiring three employees. One can work after school helping me make feed; this employee will be happy with the minimum wage. My other two employees will be drivers. I will pay them more since they will have more responsibility and be held to a high standard of excellence due to their direct interaction with customers.

Three Minor Elements:

Most Valuable Resource: My most valuable resource is proximity. It is what truly allows me to set myself apart from competitors.

Next Opportunity or Innovation: My next opportunity is to exploit similar markets in my tri-county area. I will deliver to everyone who lives more than ten miles from a farm supply store.

What's Next for Me: On a larger note, I will experiment with new products and contracts. Most notably, I can expand my delivery service sector to deliver for various other supplier and vendors. I will charge a fair fee for delivering to specific clients. I think this could result in even greater sales volume, potentially adding an additional 15% to my existing sales.

Avoiding Pitfalls and Traps:

A helpful list from Dr. Pryor

"1) Students talk about their innovation or concept in their description of the opportunity. When you talk about opportunity, you should talk only about your customers and their needs.
2) You can’t solve everything. Figure 1 shows how an opportunity and innovation only partly overlap. Your innovation won’t solve every customer’s need, and at the same time, most customers will buy your product, service, or process for part of the attributes and features it offers and ignore (or care less about) the others. Recognize these limitations, and especially don’t hesitate to indicate who your customers aren’t.
3) Related to No. 1, students tend to blend all three of these elements together. Be careful. Each of these elements concern unique concepts and should be described as clearly as possible.

4) Many concepts fail to provide enough detail about the three elements. The more you can fit into this description (and you’re limited to only two pages), the more in-depth the online conversations can be.

5) Students often assume that the best way to write a concept description is to use a narrative format. That’s not true. In the last two pages alone, I’ve used a picture, I’ve used bullet points, I’ve used numbered lists, and I’ve used narrative. I’ve also used bolded sub-headings, and I have italicized important words. What I care about is clear communication -- do what it takes to clearly describe your venture concept." -- Chris Pryor