1. Compare new sustainable business practices to current industry practices. Select one sustainable business practice for the rest of the assignment that provides your organisation with venture uniqueness and/or innovation (radical or incremental).
2. Identify opportunities and/or threats linked to implementing or not implementing your selected sustainable business practice.
3. Identify associated benefits and/or cost (financial and others).
4. Discuss how the adoption of sustainable business practices could impact the performance measurement of your entrepreneurial new venture using the triple bottom line.
Entrepreneurship is the method of designing, running and launching a new business. Entrepreneurs start a new business with a notion to earn profit from the business (Drucker 2014). The types of ‘sustainopreneurship’ practices have strategic purposes and objectives that respect the social boundaries and also earn a profit. Moreover, these types of businesses can be defined as ‘businesses with a cause’. In this study, an entrepreneur venture will be launched with a sustainable practice. The aim of the study is to highlight a sustainable entrepreneur practice where real-world problems can be turned into business opportunities by deployment of sustainable innovations.
Green & Co is going to be a green restaurant established in Perth. The concept of a green restaurant defines that the restaurants aims to become environmentally responsible. Green & Co is going to be the first of its kind in Perth and will use a world class waste management technique. The supply chain process of the restaurant will be sustainable and as a result will not harm the environment. Green & Co will be a rooftop restaurant that is going to offer raw and vegan food items accompanied with alcoholic and or non-alcoholic beverages. The rooftop restaurant will have a touch of green on the roof and the seating arrangements will be made out of recycled timber. A significant aspect of Green & Co that will not harm the environment is the unique cooking process of the restaurant, where no percentage of smoke will reach and contaminate the environment. Green & Co will attain a certificate from the Green Board and will claim that Green & Co is 100% a green restaurant and credible to the community. The major target of sustainability is the water efficiency, food services, recycling, waste reduction, building and interior materials.
Green & Co will be part of the Australian Food and Beverage industry. The Food and Beverage industry is a significant industry sector in terms of employment and financial contribution and is very robust. Correspondingly, the Food and Beverage industry in Australia earned revenue of 104 billion AUD in 2016 (Schaper et al. 2014). Additionally, employees that work in the Food and Beverage industry equates to almost 15% of the overall service sector in Australia. Moreover, in Perth, there are various restaurants that offer quality food products and beverages. There are more than 72,040 registered food and beverage service businesses overall in Australia. Therefore, in order for Green & Co to maintain a strong competitive advantage they will endeavour to be unique in the way that they are going to be environmentally responsible at the core.
Green & Co is going to be a vegetarian restaurant and it is going to offer salads, fruit salads, rice, bread, wraps, burgers, pizza, sandwiches, soup and pasta. This restaurant will offer breakfast, lunch and dinner to the customers and serve the customers from 7 am to 11 pm at night. The alcoholic beverages will be served all day long. The restaurant will offer Absinthe, Beer, Brandy, Cachaça, Gin, Ouzo, Rum and Whiskey. There will be a parking lot where the customers can keep their cars. The restaurant will be on the 12th floor. The speciality of the restaurant will be the ambience and it will have two sections on 12th floor, one section will have an open rooftop and another section will be the cafeteria. The touch of greenish beauty on rooftop floor will attract the customers with quality food.
Green & Co will be a green restaurant and the business will need a large investment in technology and the day-to-day operation of the restaurant will be expensive. The restaurant is aimed at the upper-middle class environmentally conscious customers who can afford premium pricing of the food items and alcoholic beverages. Green & Co is going to target primarily the young generation who want to check out fine cuisine with excellent ambience and share the status symbol. The secondary target customers will be professionals who can arrange informal meetings with clients in a cosy ambience with fine delicacies.
In the restaurant industry, the common business practices are the successful independent owners. In the restaurant industry of Australia, most restaurant owners are independent and they open small businesses as an entrepreneurial venture. In addition, there are certain large players in the market that have opened their outlets in Australia too. The current industry practice in the Food and Beverage sector revolves in marketing around the customers' database (Kirzner 2015). Successful independents in restaurants mail customer newsletters to their customers at the beginning of each month (Frederick et al. 2015). In Australia, most restaurants run with minimal staff as they want to grow the profit first prior to growing units. More importantly, most restaurant businesses keep a running inventory as the potential profits are decreased due to potential theft, spoilage, waste and unrecorded sales.
Australian Government has taken the initiative of national Innovation and Science Agenda for the start ups as between 2006 and 2011, start-ups venture created more than 1.44 million jobs in Australia (Innovation.gov.au 2017). This government initiative helps in innovation and funding in early stage of business. In crowd-source equity and raise money, this initiative will be helpful. NSW Government launches the innovation strategy that could strengthen the entrepreneurship practices. NSW government is going to create Ministerial Innovation Committee to see the strategy implementation and the government has set aside $3 million to grant the start-ups in 2017-2018.
Products and Service Offering
There are two different types of sustainability, strong and weak. As stated by Brandenburg et al. (2014), weak sustainability refers that an organisation can use natural capital if it is manufactured the capital of equal value. On the other side, strong sustainability refers to the natural capital that must be maintained and increased so that it can performance of the organisation must not be duplicated by manufactured capital. An entrepreneurship practice can use natural resources so that it provides services and materials. An entrepreneur can focus on mainly four capital model so that it can acquire the profitability as well as the societal impact. An organisation’s social responsibility depends on the human capital and it is related to the labour skills, intelligence, social networks, trust and reputation and influence and power (Farguson and Souza 2016). Secondly, financial sustainability refers to the debt, cost, monetary instrument and investment. Moreover, an entrepreneur can practice environmental sustainability in order to make the business sustainable, natural capital is related to the resources, living system and ecosystem services. Manufactured capital is associated with the infrastructure, factories and machines tools. However, too much attention to manufactured and human capital can affect the environmental sustainability.
Water stewardship: In addition, restaurants in sustainable practices use water efficiency and conservations as in landscaping of the restaurants, the management uses the plants that do require less water to grow. The sustainable restaurants are setting up catchment in order to reuse the water and for rainwater harvesting.
Waste reduction: Waste reduction in the restaurant is one such factor that can be eco-friendly. The entrepreneurs in green restaurant are trying to go paperless and they are trying tom use technologies for booking and billing (Frederick et al. 2015). The reusable menu, reusable coasters and staple-free staplers can be used in restaurants. Moreover, use of towels, environmentally friendly cleaners, wash dishes and steam cleaning can be used in the green restaurants.
Energy efficiency: Another sustainable practice in the green restaurant can be energy efficient electricity. The restaurant can use indoor moderate temperature and use energy-star compliance. Energy star-appliances can provide support to save extra energy; the restaurants can purchase energy efficient toasters, microwaves, OTG, fans, exhaust fans, ovens, refrigerators and lighting.
Of late, the in global perspective, the green or sustainable restaurant offers green food that is mostly vegan or organic food. In food labels, the restaurants can use GMO labels (Karuatko 2016). Finally, in the restaurant industry, the management of supply chain is very important and most of the common business practices use large supply chain. The result of the large supply chain is to hamper the environment with pollution from vehicles (Storey 2016).
Being green is one of the hottest concepts in a green and sustainable business practice. As opined by Brandenburg et al. (2014), most restaurants and businesses are trying to spend more in re-branding themselves as green and they are trying to give special concentration on supply chain management and recycling. In an eco-friendly supply chain, Green & Co will make partners with a small number of suppliers and logistics; where they will be using renewable energy. In keeping the raw materials, they will keep the products in cold-storage and the waste of raw materials will be zero. Green & Co will choose suppliers and partners who are environmentally and socially responsible and will discuss freely whether the suppliers are ethical partners or not. As stated by Seuring (2013), a green supply chain is integrating environmental thinking into supply chain management, including material sourcing, manufacturing process, and selection of partners and delivery of the final products to the consumers. Supply chain sustainability is an organisation based issue that can influence an organisation in terms of waste costs, risks and environmental issues (Frederick et al. 2015). In the traditional case, the supply chain of the organisation ensures a just-in-time approach and suppliers use multiple vehicles in reaction to increasing the environmental costs.
Eco-friendly supply chain has the interface in the supply chain process and it represents movement of goods, information flows, transfer of title and purchase and sale. Moreover, strategic supply chain can consists of developing smarter ways to buy from, choose and sell to business partners.
Developing sustainable business is related to the strategy as it is one of the important drivers in planning and setting values of the entrepreneurship practices. The strategy of sustainable business is related to the environmental, economic, social and cultural ideals. In addition, process is related to the change and it is related to the production technique, energy efficiency and developing resources. In order to create lean operation, Green & Co can do the transport in cost saving way. People are the centre of the business and good employment practices are necessary in business process of Green & Co. Lastly, capital is essential in business and selling products, services and delivering or attracting investors. Two-fold capital benefits of sustainability are related to improved images and savings from inefficiencies (Ortiz?de?Mandojana and Bansal 2016).
Most companies spend a significant amount of money in supply chain management and in business operations. There are benchmarking tools that can reduce waste from the supply chain. In Green & Co the restaurant takes the collaboration strategy with the suppliers that can help in sharing the distribution and logistics of management.
Current and New Sustainable Business Practices
In supply chain management, new venture Green & Co can partner with local suppliers in taking the raw materials for making food items and as a result it will eventually minimise the transportation kilometres. Once Green & Co identifies the suppliers and sustainable materials they must be transparent with their customers. Green & Co can use easy-to-read info-graphics in order to illustrate the whole supply chain process and the energy efficient moves.
- Increased revenues
- Increase asset utilisation
- Reduced costs
- Enhanced customer services
- Increased energy efficiency
- Reduced waste
- Reduced water emissions
- Reduced fuel consumption
- Reduced air emissions
- Noise reduction
- Traffic congestion
- Reduce community impacts
Design the products in such a way that can fit the recycled materials as the food items of the Green & Co restaurant will be vegan and organic. The packaging they will be using would be recyclable. As opined by Beske et al. (2014), managing waste in the supply chain is very important as this is related to the waste management and the compost process. Recycled glass and cardboard can be used in the packaging of raw materials by the suppliers and Green & Co can focus on showcasing the innovation through this. In the supply chain process, Green & Co can engage employees and investors in order to make it more transparent.
When implementing a sustainable supply chain, Green & Co can face multiple threats in supply chain management. In the sustainable supply chain, Green & Co can face the issues of quality of supply as the numbers of suppliers will be lower in the sustainable supply process. Green & Co can apply the sustainable supply chain process by decreasing the cost of supply chain and in order to make the business more environmentally friendly. This can result in the geopolitical security as the suppliers can use the RFID technology in the supply chain that uses a radar technique in order to track vehicles (Sarkis 2013). The entrepreneurship practice is itself a risk and in extreme weather conditions, the relationship between suppliers and restaurant can no longer be established.
Green & Co can generate revenues by creating new business models in the supply chain as the supply chain process and operation will be small. In developing sustainable business practice through the supply chain, the restaurant can enhance its brand name that would increase the chance to develop the business in new markets apart from Perth. In addition, the sustainable practice can improve the energy efficiency and that can reduce the cost and streamline the supply chain and logistics can reduce the costs as well (Govindan et al. 2014).
Green & Co needs to follow the stakeholders in order to maintain the reputation in the market. Stakeholders like customers, investors and suppliers can put pressure to extend the sustainable business practice. Supply chain sustainability process of the organisation can be published through a blog that can bring publicity to the organisation. In the restaurant industry, the main suppliers are from agricultural sectors and these types of products do not last long if they are kept in the open (Ortiz and Bansal 2016).
The carbon footprint is an issue of the environment and it can be reduced through the use of vehicles. The figure will touch 20 million tons per year in greenhouse gas emission by the end of 2020. Wal-Mart, in this case, will be an example that is trying to reduce the supply chain and CSR technique of Wal-Mart has been remaining the same (Zhu et al. 2013). The process of making the supply chain small can save significant money for an organisation and it can influence positively on the organisation.
Green & Co needs to be familiar with the global standards of contract in sustainable supply chain management. As it is a new venture, entrepreneurs may not know the global standards; however, they can follow the shared commitment in helping the industry to zero discharge of hazardous elements from the supply chain. The warehousing policy and logistics contracts must follow the global standards.
Green & Co will be a new venture and the sustainable business practices can make the organisation follow the CSR practices. From the very first day, the organisation will start to follow corporate social responsibility.
The social bottom line can measure the business profit in human capital that is included with the position in the local market. The social bottom line can be defined as the organisational benefits on the local society based on the labour practices (Hogevold et al. 2015). ‘People’ concept stands for the socially responsible organisation. Green & Co will use supply chain that will be maximum from the local places or any agricultural firm. The restaurant will nurture a positive relationship with the local community and the customers will be from the Perth local communities. The social bottom line is included with sustainable business practices in long-term basis and sustainable supply chain will provide an opportunity to some of the employees to get a job in a restaurant.
The business venture Green & Co will have less impact on the environment as the main aim of the business will be a green restaurant that is an eco-friendly restaurant. Controlling the environment means monitoring, managing, reporting the consumption of waste and carbon or fuel emissions (Farguson and Souza 2016). Planet concept stands for the how the entrepreneur practice is environmentally responsible. The restaurant will have the best waste management technique and the implementing of the supply chain will reduce the chance of pollution through the logistics. The vehicles in the supply chain will be energy efficient and numbers of vehicles will be small as well. Green & Co will have green policies and it will have corporate-wide values in all levels of business.
The Economic bottom line is not only the corporate capital; however, it is included in the human and environmental capital as well. The business must impact on the economic environment as well and the business needs to strengthen the economy of the industry. Profit of the organisation is very important and economic sustainability is constant profit-making venture (Suliman et al. 2016). Green & Co must be aware of the profit and the break-even point of the business must be gained within two years of the business. It is a matter for Green & Co to survive in the industry for future as the economy is related to the contribution of community and economic condition.
Management of new venture Green & Co can interpret the sustainability to all levels in an easier way by integrating value creation, long-term social and economic aspects. One of the strategic approaches to attain the sustainable business practice could be of the sustainable supply chain management.
The entrepreneur must appoint management of the business venture to a team who know the sustainability performance of the business. Each member of the team in Green & Co must follow the sustainable operation including the supply chain. Technology must be utilised in the business practices. The incentive scheme can be implemented by management to facilitate the business practice.
In the business practice, Green & Co must practice the ethical work in respect of laws and regulation. In the supply chain, any kind of corruption and favouritism will not be entertained in choosing the suppliers. The behaviour of management can be recorded and resources should be utilised in a proper way. In promoting the new venture, the entrepreneur must respect the human values as well as environmental values.
In the opening of the new venture, environmental impact and economic profit both are important in recent times. The new venture Green & Co must cooperate with stakeholders in opening bilateral communication. In addition, entrepreneurs find gaps in the existing market and use disruptive innovative concepts to start a new venture. Additionally, in recent times, entrepreneurs have been developing the concept of social entrepreneurship as these are the creative business entrepreneurial practices that can solve the issues related to the sustainability agenda. Moreover, entrepreneurs in selecting partners must prioritise the sustainability and the operational need to be transparent as well.
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