SIMPLY GREEN BIOFUELS

What similarities do you think a sustainable business start--‐up shares with a “normal business” start--‐up?
What differences do you think there are?
Give an example of a business challenge that both Simply Green and a conventional fuel dealer share.
Give an example of a business challenge that was unique to Simply Green and would not have affected a conventional fuel dealer from the chapter.

Business Start-up Issues
Starting a business is both an invigorating yet daunting challenge. Hundreds of new businesses are started every other day across a range of industries. However, the fact is that start-up businesses have a very high rate of failure.
Some common consequences that are common to any kind of business – Sustainable or Normal are:

Inadequate funding: Securing finance is one of the toughest challenges faced by new business owners. Banks and credit agencies are generally wary of lending to new companies as they are less likely to have any credit history. In this particular case Andrew Keller was fortunate enough to have an existing profitable business which could provide funding as the initial capital for his new venture.

Poor marketing: The costs associated with marketing and advertising can be expensive. As a startup the principles need to be very clear with its target market and business environment. Andrew Keller was able to use social media and his existing contacts with greater success.

Poor Planning: Proper planning gives you the opportunity to analyze your business idea and how to execute it. Andre Keller preferred to start during the “soft” spring period to better understand and anticipate any potential issues.

Staffing problems: Getting the right kind of employees and the right head count is challenge faced by new business owners.

Competition: Every Established companies have both brand recognition and financial strengths and competing against them require an innovative and novel approach.

Sustainable Business specific Issues.
Acceptability: Sustainable Business models stand on people, planet, and profit. while traditional business model works primarily on the Profit model. Getting investment and starting the process takes a commitment far beyond just looking at the "Bottom Line”.

Marginal Niche: The market for green products especially during hard financial times is very limited; People are looking to spend the least and need to be educated on how a sustainable business product may be better for them in the long run.

Common Business Challenge.
An example of a business challenge that both Simply Green and a conventional fuel dealer share would have been volatile oil prices and changing overall economic conditions. As a standard industry practice Oil dealer’s prebuy oil from suppliers, in the winter of 2008 Oil went to an unanticipated $4 a gallon and all Oil dealers were contractually obligated to pick up those gallons at the fixed price.

Simply Green specific Business Challenge.
A challenge specific to Simply Green was essentially human errors. Andrew Kellar while managing the start-up with all his enthusiasm for the environmental and social mission failed to understand that’s it still was a business and in the end needed to have effective management of capital and cash resources.