ENTREPRENEURSHIP

BA(BS) 421
MISS FARIHA KHAN
 PORTER’S FIVE FORCES
• Porter’s Five Forces: A tool for analyzing the competitive forces within
an industry and understanding the potential for profitability.
 Threat of New Entrants: Medium
• Barriers to Entry:
• Capital and Operational Costs: Starting a food delivery service like
Foodpanda requires significant capital investment in technology
infrastructure, building a delivery network, and customer acquisition.
While new entrants can use third-party platforms or limited-area
services, large-scale operations are capital-intensive.
• Brand Recognition and Network: Foodpanda has already established
a strong brand and network of restaurant partners and delivery riders.
New entrants would need to heavily invest in marketing and
partnerships to gain a foothold in the competitive market.
Threat of New Entrants: Medium
• Technology and Logistics: The need for advanced technology to
handle orders, payments, and logistics is another barrier. New
companies might struggle to build the necessary infrastructure for an
efficient, reliable service.
 Bargaining Power of Suppliers: Low
to Medium
• Supplier Concentration:
• Foodpanda works with thousands of restaurants, so the bargaining
power of individual suppliers (restaurants) is typically low. The large
network of restaurants available on the platform dilutes the power
any single supplier may have.
 Bargaining Power of Suppliers: Low
to Medium
• Importance of Suppliers:
• However, some popular and exclusive restaurants may have higher
bargaining power, especially if they are in high demand. These
suppliers might negotiate better terms with Foodpanda, or even
choose to partner with other platforms for better visibility or profits
 Bargaining Power of Suppliers: Low
to Medium
• Food Quality and Pricing Pressure:
• Suppliers may also influence food pricing and quality, impacting
Foodpanda’s ability to control service costs and customer satisfaction.
 BARGAINING POWER OF
CUSTOMERS: HIGH
• Multiple Alternatives:
• Foodpanda faces significant competition from other food delivery
services like Cheetay, Uber Eats, and Careem NOW, giving customers
many alternatives. As a result, customers have high bargaining power.

• Low Switching Costs:

• Switching between food delivery services is easy for consumers as the
apps are simple to use, and the products (food) are interchangeable
across platforms. There are very few loyalty barriers.
 BARGAINING POWER OF
CUSTOMERS: HIGH
• Price Sensitivity:
• Many customers are price-sensitive and may choose a platform based
on promotions, discounts, or delivery fees. They can easily compare
options across platforms, which puts pressure on Foodpanda to
maintain competitive pricing and offer deals to retain customers.
 THREAT OF SUBSTITUTE PRODUCTS
OR SERVICES: MEDIUM
• Alternative Food Sources:
• Customers may opt for cooking at home, ordering directly from
restaurants without a third-party service, or using alternative services
like meal kit deliveries. These options present substitutes to food
delivery platforms.
• Home-Cooking Trends:
• With increasing health awareness, some consumers may prefer
preparing food at home, especially as food delivery prices rise or the
demand for healthier options increases.
 THREAT OF SUBSTITUTE PRODUCTS
OR SERVICES: MEDIUM
• Meal Kits and Grocery Delivery:
• The rise of meal kit and grocery delivery services, where consumers
can order fresh ingredients and cook at home, also competes with
food delivery platforms, especially for consumers seeking
convenience but with more control over what they eat.
 INDUSTRY RIVALRY: HIGH
• Number of Competitors:The food delivery industry in Pakistan is
highly competitive, with several well-established players such as Uber
Eats, Cheetay, and Foodpanda itself. These competitors are vying for
market share, creating intense rivalry.
• Service Differentiation:While Foodpanda and its competitors offer
similar services (food delivery), there is some differentiation in terms
of app user experience, customer service, delivery speed, and
restaurant partnerships. However, these differences are often not
significant enough to reduce competition substantially.
 INDUSTRY RIVALRY: HIGH
• Price Wars:Price competition is prevalent, especially with the rise of
discounts, offers, and lower service fees. The frequent promotions
and discounts are driven by the need to capture market share in a
crowded field.
• Switching Costs:As mentioned, customers can easily switch between
platforms, and there are few loyalty factors that bind them to a single
service. This increases rivalry further as platforms fight to retain and
grow their customer base.
• Business Model Canvas: A visual tool to outline the key elements of
the business model, including customer segments, value propositions,
channels, and revenue streams.
 Key Partners
• Restaurants and Food Providers: Foodpanda partners with a wide
range of local and international restaurants to offer various cuisines to
its customers.
• Delivery Riders (Logistics Providers): Independent delivery riders (or
drivers) are crucial to the delivery process. Foodpanda either employs
or partners with riders who use their own vehicles to fulfill orders.
• Payment Service Providers: Partnerships with digital payment
platforms (e.g., Easypaisa, JazzCash, and credit card companies)
facilitate secure online transactions.
 Key Partners
• Technology Providers: Third-party companies that help with
infrastructure, IT support, and payment gateway solutions.
• Marketing and Promotion Partners: Collaborations with influencers,
media channels, and advertising agencies to boost brand awareness
and customer acquisition.
 KEY ACTIVITIES
• Platform Development and Maintenance: Building and maintaining
the online platform (mobile app, website) for customer ordering,
payments, and tracking.
• Restaurant Onboarding and Management: Continuous onboarding
and support for restaurants to keep the platform diverse and ensure
restaurants meet the required food safety and quality standards.
• Order Fulfillment: Managing the logistics of order processing,
including dispatching and tracking deliveries through riders.
 KEY ACTIVITIES
• Marketing and Customer Acquisition: Running digital marketing
campaigns, promotions, discounts, and offers to attract new
customers and retain existing ones.
• Customer Support and Service: Providing customer support for
inquiries, complaints, refunds, or any issues related to food delivery.
 KEY RESOURCES

• Technology Infrastructure: The website, mobile apps, and backend

systems that handle orders, payments, user data, and the logistical
process.
• Brand Equity: Foodpanda's established reputation in the market,
which adds customer trust and loyalty.
• Delivery Fleet: A network of delivery riders and drivers who ensure
timely deliveries.
 KEY RESOURCES
• Data and Analytics: Customer data, behavioral insights, and
operational metrics that help in decision-making, personalizing user
experience, and optimizing routes.
• Restaurant Network: An extensive range of restaurant partnerships
offering diverse food options.
 VALUE PROPOSITIONS

Convenience: Foodpanda provides a hassle-free and fast food delivery

service directly to the customer’s doorstep, saving time and effort.
Variety: A broad selection of restaurants and food options available on
the platform, catering to different tastes, dietary preferences, and
budgets.
Speed and Reliability: Reliable and quick delivery service with real-time
tracking of orders.
 VALUE PROPOSITIONS
• Promotions and Discounts: Foodpanda frequently offers discounts,
deals, and loyalty programs, making food delivery more affordable.
• Multiple Payment Options: The ability to pay via cash on delivery,
credit cards, or digital wallets (e.g., Easypaisa, JazzCash), enhancing
payment convenience for customers.
 CUSTOMER RELATIONSHIPS
• Loyalty Programs: Offering loyalty rewards, discounts, and incentives
to repeat customers to keep them engaged and encourage brand
loyalty.
• User Engagement: Regular email campaigns, push notifications, and
app-based promotions to keep users engaged with the platform.
• Personalized Customer Service: Providing 24/7 customer support
through live chat, phone, and email for inquiries, complaints, and
refunds.
 CUSTOMER RELATIONSHIPS
• Feedback Mechanisms: Collecting feedback through customer
reviews, ratings, and surveys to improve service quality and user
experience.
 Channels
• Mobile App: The primary platform where customers place orders,
track deliveries, and make payments.
• Website: An alternative platform where customers can access the
menu, place orders, and track deliveries.
• Social Media: Engaging with customers and promoting deals and
offers through social media channels (Facebook, Instagram, Twitter,
etc.).
• Advertising and Promotions: Digital advertising (Google Ads, social
media campaigns) and offline promotions to drive brand awareness
and user acquisition.
 CUSTOMER SEGMENTS

• Urban Middle-Class Consumers: Working professionals and families

who seek convenience in food delivery.
• Young Tech-Savvy Individuals: Millennials and Gen Z who prefer to
order food online via their smartphones.
• Food Enthusiasts: Customers who value variety and are looking to
explore different cuisines and restaurants.
• Business Clients: Companies and offices ordering food for employees
during meetings or events.
• Low to Middle Income Groups: Offering budget-friendly options
through discount promotions and affordable meal selections.
 COST STRUCTURE

• Technology and Platform Maintenance: The cost of developing and

maintaining the app, website, backend systems, and payment
infrastructure
• Marketing and Advertising: Significant expenses go into running
promotional campaigns, digital ads, influencer collaborations, and
customer retention programs.
• Logistics and Delivery Costs: Expenses related to paying delivery
riders, managing the fleet, and ensuring timely delivery of food.
 COST STRUCTURE
• Restaurant Partnerships and Commissions: Foodpanda often takes a
commission from restaurants on each order, which is part of its cost
structure.
• Customer Service and Support: Costs associated with maintaining a
customer support team and handling complaints, refunds, or queries.
 REVENUE STREAMS
• Commission on Orders: Foodpanda earns revenue by charging
restaurants a commission for each successful order placed through
the platform. This is typically a percentage of the order value.
• Delivery Fees: Customers pay a delivery fee based on their location
and the size of the order, contributing to Foodpanda’s revenue.
• Advertising and Promotions: Restaurants may pay for additional
visibility on the platform, and Foodpanda can generate income
through sponsored ads or featured listings.
 REVENUE STREAMS
• Subscription Services: Foodpanda may offer subscription models for
customers, such as discounted delivery or exclusive access to certain
restaurant offers.
• Data and Analytics Services: Foodpanda can monetize aggregated
data and insights about customer preferences and market trends to
partner with restaurants or third parties.
 WHAT IS A BUSINESS PLAN?
A business plan is a detailed written document that outlines a business's
goals, strategies, and the steps it will take to achieve those goals. It
serves as a roadmap for the business, detailing its mission, vision,
products or services, target market, competition, financial projections,
and operational plan. A business plan is often used to secure funding
from investors or lenders, and it helps business owners stay focused and
organized as they build and grow their company.
 FUNCTION OF A BUSINESS PLAN
1. It provide a battery of tools a mission statement, goals, objectives,
budgets, financial forecast, target market and entry strategies to
help entrepreneur subject their ideas to one last test of reality
before launching the business.
2. The second function of business plan is to attract leaders and
investors
 BUSINESS PLAN TEST
• To get external financing, an entrepreneur plan must have three test
1. Reality test
2. Competitive test
3. Value test
 REALITY TEST
• The Reality Test checks whether the business idea is viable and
grounded in reality. This test focuses on assessing whether the idea
addresses real-world problems, can be implemented effectively, and
has a market for it. It looks at factors such as
• Feasibility: Is the business idea realistic? Can it be executed with the
available resources, technology, and skills?
• Market Demand: Is there a proven demand for the product or
service? Are customers willing to pay for it?
• Financial Viability: Are the projected financial returns reasonable,
and will the business be able to cover its costs and generate profits?
 COMPETITIVE TEST
• The Competitive Test examines the competitive landscape and
whether the business can effectively compete with existing players in
the market. This test involves:
• Market Differentiation: What makes the business stand out from its
competitors? Does it have a unique selling proposition (USP) or
advantage that differentiates it?
• Competitive Advantage: Does the business have any strengths (such
as proprietary technology, brand loyalty, or cost advantages) that will
allow it to compete successfully?
• Barriers to Entry: Are there any barriers (e.g., high startup costs,
patents, or regulations) that will prevent other competitors from
easily entering the market?
• This test helps identify the potential challenges from competitors and
evaluates whether the business can sustain a competitive edge.
 VALUE TEST
• The Value Test assesses whether the business creates value for its
customers, stakeholders, and the entrepreneur. It’s about
understanding the worth of the business and its impact. Key factors
include:
• Customer Value Proposition: Does the business deliver enough value
to customers to justify the price they’ll pay? Is the product or service
solving a significant problem for customers?
• Profitability: Is the business model sustainable in the long run? Will it
generate profits, and can those profits support the business's growth
and objectives?
• Social Impact: Does the business create value beyond just profits,
such as contributing positively to society or improving the
community?
• The Value Test helps ensure that the business is focused on providing
tangible benefits and has long-term potential for growth and success.
BUSINESS PLAN FORMAT
 TITLE PAGE AND TABLE OF
CONTENTS
• Title Page: This page includes the name of the business, logo (if
available), the business owner(s) or founders, and contact
information.
• Table of Contents: A list of all sections and subsections of the
business plan, allowing readers to easily navigate the document.
 EXECUTIVE SUMMARY
• This section provides a high-level overview of the entire business
plan. It should be concise but compelling, offering the reader a
snapshot of the business, its mission, and its key goals.
 MISSION AND VISION STATEMENT
• Mission Statement: A brief statement of the business's core purpose
and values. It should answer the question: "Why does this business
exist?“
• Vision Statement: A clear, aspirational statement about what the
business hopes to achieve in the future. It should answer the
question: "Where do we want to be in the long term?"
 DESCRIPTION OF FIRM’S PRODUCT
OR SERVICE
• his section provides a detailed description of the products or services
the business will offer. It covers:
• Product/Service overview: Description of the products or services,
including their features and benefits.
• Unique selling proposition (USP): What makes your product or
service stand out from competitors?
• Development or production process: How the product or service will
be created or delivered.
• Pricing strategy: How products or services will be priced to attract
customers and ensure profitability.
 BUSINESS AND INDUSTRY PEOPLE
• This section focuses on the business’s structure and the people
involved in the company’s operations:
 COMPETITOR ANALYSIS
• This part is crucial to understanding the market landscape. It includes:
• Direct and indirect competitors: Identify and evaluate key
competitors, both direct (those offering similar products or services)
and indirect (those offering alternative solutions).
• Competitive advantages and disadvantages: Analyze your business’s
strengths and weaknesses relative to competitors.
• Market positioning: Where does your business fit in the competitive
landscape, and how will it differentiate itself?
 MARKET ENTRY STRATEGY
• This section outlines the approach the business will take to enter the
market and gain initial traction:
• Market entry strategy: The approach the business will use to break
into the market, whether through direct sales, partnerships, licensing,
or franchising.
• Barriers to entry: Identification of any obstacles that could make it
difficult for competitors to enter the market.
 Market Strategy
• This part outlines the overall strategy the business will adopt to grow
and succeed in the market:
• Marketing plan: How will the business promote its product or service
to attract customers? This may include online and offline marketing
tactics, such as social media, content marketing, SEO, or influencer
partnerships.
• Sales strategy: The approach the business will use to convert leads
into paying customers, such as direct sales, e-commerce, or retail
partnerships.
 TARGET MARKET

• This section defines the customer base the business is targeting and
provides detailed insights:
• Customer segmentation: Identify and describe the target audience by
demographic, geographic, psychographic, and behavioral factors (e.g.,
age, income, location, lifestyle, buying behavior).
• Customer needs: What are the specific needs of the target market,
and how does your product or service meet those needs?
 PROMOTION, 4 PS, PLAN OF
OPERATION
• This section details the key elements of the business’s marketing mix
and operational plan.
• Promotion Strategy:
• Promotional tactics: How will the business communicate its product
to the market (e.g., advertising, PR, events, or partnerships)?
• Marketing channels: Where will the business promote its products or
services (e.g., social media, email marketing, TV ads)?
 PROMOTION, 4 PS, PLAN OF
OPERATION
• 4 Ps (Marketing Mix):
• Product: The actual product or service being sold, including features,
design, and branding.
• Price: The pricing strategy, including how the business will price its
product or service relative to competitors.
• Place: Distribution channels (e.g., online, physical store, direct sales).
• Promotion: How the business will communicate its value proposition
to customers.
 PLAN OF OPERATION
• This section describes how the business will be run on a day-to-day
basis, covering:
• Location: Where the business will operate (e.g., office, storefront, or
online).
• Technology: Any tools, systems, or software the business will use to
operate efficiently.
• Suppliers: Key suppliers or partners necessary for the business to
function
• Staffing and management: The team responsible for executing daily
operations.
 FINANCIAL FORECAST
• A Financial Forecast is a critical part of a business plan, as it provides
a detailed projection of the business's financial performance over a
specified period (typically 3-5 years). It helps stakeholders, such as
investors, lenders, and the business owner, understand the expected
revenue, expenses, profitability, and cash flow of the business.