In this paper, I have chosen the product “Farm to Finger”. I will discuss the different kinds of strategies used to operate this business effectively and efficiently to sustain it in the organization. At first, I will provide the background of the product then I will explain the various strategies used in the product market. Secondly, I will elaborate on the financial strategies used by the company. Then, I will mention the market potential investor used by this company to operate the financial activities smoothly. Moreover, I will explain the different organizational strategies that we have used to achieve the target goal. At last, I will discuss some of the risk associated with this business and some of the measures to overcome those risk.
Keywords: product market, organizational, financial, investors, risk, strategies
Determining the organizational strategy of Farm to Finger
Farm to finger is the agricultural product marketer that directly connects to the farmers and assemble the local products from them and deliver to the customers. It was established to maintain a gap between the farmers and customers. It provides great quality fresh and organic products at a reasonable price. Now, this company is in survival stage where we have anticipated the requisite for cash to keep the company constant and cost-effective. In this stage, we have already made the financial projection of our business and also we have evaluated the income statement, sales revenue, balance sheet, and cash flow to make the proper financial activities. We have also recognized the associated risk and used some methods to mitigate those risk.
The strategy used for product-market
A product marketing strategy goes hand to hand with the product strategy. It is the plan that recognizes and characterizes what we need to achieve. A proper strategy focuses on everybody from the CEO to sales to consumer support in a similar direction. It aids in keeping us concentrated on our customers and the target market (Hellmann & Puri, 2000). The agricultural product marketer is to protect the services engaged with moving an agricultural product from the farmers to the buyers. Likewise, we focus on marketing the products by adding value to those products with different methods by arranging, sorting out, coordinating, handling, repackaging, rebranding, and marketing agricultural products so as to satisfy both the farmers and the buyers. Hence, the basic features of this business are gathering, transporting, evaluating, preparing, and utilizing the selected agricultural products.
As we know, nowadays people are being health conscious. So, the product was started with the aim to connect more and more rural farmers to the urban consumers and create a healthy and easy lifestyle by providing highest quality products with natural, fresh and agricultural products. Our target customers are mainly office workers, business person and health freak. Additionally, there are some competitors that exists in the same market but the best part is that we are able to compete with them by mainly using two methods of Porters competitive strategy that are cost leadership and differentiation (Dess & Davis, 1984). Cost leadership because we provide our products with high volume low cost and differentiation as we have maintained uniqueness in our products by not just connecting farmers and consumers but, providing chemical-free products with eco-household products and also listing full information about the products like when, how and where it was produced to make our consumer aware of those products.
A financing strategy is crucial for any association’s strategic plan. It sets out how the association intends to invest its overall tasks to meet its goals now and in the coming future. A financing strategy has precise targets, and the actions to be made over a three to five-year time span to accomplish the goals (Anthony, 2019). To run the business effectively we have projected different financial strategies such as income statement, balance sheet and cash flow statement to know how the organization will utilize and deal with its financial assets to seek after its goals. Fundamentally, it outlines the steps to develop the business and achieve our financial objectives.
Strategy for the potential investor market
To make the product or service successful in the market, it should have a recognizable need in the market. Most of the companies get solutions for failed organizations in search of issues. Accomplishment comes through the sale so, for individuals to pay for what you give, they should feel that they need it (Lazi, 2017). Investors will perceive how our products tend to discourse particular issues that the potential customers have. Whatever may be the size of the potential market, we need to first discover our way in. A few organizations begin with a high-end procedure and after that go to the majority whereas, others search for a lower-income market to help build up a mass intrigue. With a particular purpose of entry, we would be able to depict to investors a reasonable strategy to utilize the investment that investors give to create and develop the business. There are different types of investors such as friends & family, venture capital, banks, angels, supplier, government, customers, and corporate investors. Likewise, there are two sources of funds that are debt and equity financing (Hovakimian, Opler, & Titman, 2001). The major investment of this business is through equity financing from venture capital and family. Hence, we must ascertain the good investor who can financially support our venture to magnificently sustain in the market for the long run.
Organizational strategies give an outline of the actions that we expect to make so as to accomplish our long haul business objectives. Prior to developing its strategy, the organization must contrast how it is in the beginning and how it needs to turn into. Particularly, where it needs to be at a given future time period (Miles, Snow, Meyer, & Coleman Jr, 1978). It must characterize the distinctions and afterward list what it needs to do to achieve. In business, we need a well-characterized plan so as to succeed. Without a proper organizational structure, it’s difficult to set up achievements and realize when we are accomplishing the goals.
The organization strategy is depended on the vision and mission of the business. The company started with a vision to provide our customers with the fresh Nepalese produced agricultural products. To provide information to the consumers by offering products with a complete product line of when, where, and how the products were produced to create value for the products. Also, to support organic farms that keep our earth and water pure. Moreover, the mission of this business is to provide the highest quality of fresh and agricultural products with chemical and pesticides free products. We are excited to connect additional number of rural farmers to the urban consumers and create a healthy and easy lifestyle. Further, to maintain friendly working environment where we are eager to serve and ready to educate.
The associated risk to the organization
Risk infers future vulnerability to deviation from anticipated earnings or anticipated results (Maverick, 2019). It estimates the uncertainty that a financial specialist is happy to take to understand profit from an investment. It is inalienable in any business venture, and great risk management is a basic part of maintaining an effective business. An organization’s management has to change degrees of control in regards to risk. A few risks can be legitimately overseen whereas, other risks are generally beyond the ability to control of organization management.
There is some financial risk associated with the business such as liquidity risk, market risk, operation risk, and credit risk that affects the internal and external factors of an organization. Additionally, when a similar business exists in the market then there might be the risk of loss as the consumer may be attracted to another company. Sometimes, the company can invest all the cash in assets due to which it becomes difficult to fund in the next milestone leading to a decrease in sales revenue. Further, there are some measures of risk to prevent the business from the risk are beta, standard deviation, the conditional value of risk, coefficient, and value at risk.
To conclude, in this paper I have displayed my product ‘Farm to Finger’. This is an agricultural product marketer that connects with the customers and farmers. In this business, we collect the local product from farmers and deliver to consumers. This product was started with the aim to connect a huge number of farmers to urban consumers and create a healthy and easy lifestyle by providing the highest quality products with natural, fresh, and agricultural products. We are able to compete with them by mainly using two methods of Porter’s competitive strategy which are cost leadership by providing a low-cost product with high-quality products and differentiation as it provides full information about the product like when, how, and where to the customers when delivering that product. Similarly, we have projected balance sheet, cash flow and income statement for the smooth operation of financial activities to earn sales revenue. Moreover, the major investment of this business is through equity financing from venture capital and also family. We have identified organizational strategies by determining the vision and mission of company to maintain accurate and successful business activities. Further, liquidity risk, market risk, operation risk, and credit risk are risks that are faced by an organization. To overcome those risks I will be evaluating the coefficient, value at risk, beta, and standard deviation.
- Anthony, L. (2019, January 25). Financial Strategies in a Business Plan. Retrieved from https://smallbusiness.chron.com/financial-strategies-business-plan-5107.html
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- Hellmann, T., & Puri, M. (2000). The interaction between product market and financing strategy: The role of venture capital. The review of financial studies, 13(4), 959-984.
- Hovakimian, A., Opler, T., & Titman, S. (2001). The debt-equity choice. Journal of Financial and Quantitative analysis, 36(1), 1-24.
- Lazi, Y. (2017, October 16). Developing Marketing Strategy for Potential Investors. Retrieved from https://www.lexology.com/library/detail.aspx?g=97e22a8a-8d06-4a4e-8833-0513316ef8e0
- Maverick, J. B. (2019, July 17). Financial Risk: The Major Kinds That Companies Face. Retrieved from https://www.investopedia.com/ask/answers/062415/what-are-major-categories-financial-risk-company.asp
- Miles, R. E., Snow, C. C., Meyer, A. D., & Coleman Jr, H. J. (1978). Organizational strategy, structure, and process. Academy of management review, 3(3), 546-562.