Assessment Answers Archives

Opportunity Analysis: Pet Coach

Assessment Answers, EXTERNAL ANALYSIS, Financial Analysis, Industry Analysis, Investment, OPPORTUNITY ANALYSIS, PESTLE Analysis, Swot Analysis

Pages:10

1.0 Introduction

Entrepreneurship is defined as that mind-set that gives someone the ability to see opportunity everywhere (co-founder of Sweeten) This can be a business idea and it can also mean the ability to see the opportunities in people that can help someone grow the company.

Mauritian economy encourages young entrepreneurs with great incentives. SMEs contribution to the Gross Domestic Product (GDP) is 40 percent and accounts for 54.6 percent total employment in the country.

Pet Care is a good investment opportunity in Mauritian market as people love their pets, and they are willing to provide them with the standard quality of grooming and care when they are away or busy.

1.1 Opportunity Analysis

For the past decades, there have been many incentives and supports given to enterprises for the promotion of the SME sector in Mauritius. The Start-Up Scheme that provide financial support of up to a maximum of Rs. 100,000 to entrepreneurs to set up their enterprise.

The trends that effect the pet care industry includes the increase in disposable income of middle-income group and rising trend of nuclear families. Moreover, people are adopting more pets and demanding higher quality pet products and services (Market, 2019)

The Mauritius commercial bank had teamed up with the DCDM Research to investigate on the mindset of entrepreneurs, their behaviours and motivations with regards to same.

In Year 2016, the SME sector contributes approximately 40% to the GDP and employs around 300,000 people in the country (55% of total employment).

1.2 Company

This report provides not only the opportunity analysis, but also my affection for pets. I have always been a pet lover and the idea for pet care business originated from my passion for pet grooming and pet sitting. The goal is not just to start a business, but to form a work family who work with integrity and radical transparency with clients and provide services with excellence.

Mission

To provide innovative, high-quality, consistent, value-for-money, pet friendly service that will make your pet want to come back again and again.

Vision

Vision: To bring integrity and excellence in the pet care industry and become the number 1 service provider in Mauritius.

1.3 Key People and Skills

Pet Coach intends to open two branches, one in Balaclava and the other one in Trou aux Biches

Training pets require skills and time; therefore, the firmwill employ professionals with experience in dealing with pets but most importantly animal lovers. The veterinarians possess technical skills, e.g., first aid, wound stitching, sterilization of surgical instruments. The administrative clerk with top communication skills and administrative, two carers who have the know-how of Pets’ grooming and especially those who know the premises and safety measures of Pets (especially dogs). There will also be 2 drivers, one of which will be on part time basis, and the finance administrator in charge of all financials of the company.

2.0 External analysis

The World Trade Organization considers Mauritius’s investment apparatus as “open and transparent.” (Freedom, 2019). Mauritius’ GDP expanded by 3.4% in June 2019. While the GDP per capita reached 10,992.3 USD. Mauritius Consumer Price Index (CPI) for February 2020 was estimated to be 2.1%. Moreover, the Gross Saving rate of Mauritius was 6.8% in 2019. (CEIC, 2020). These macro indicators show the financial condition of Mauritius. Over 4 million pets are transferred by air, Millions of people are choosing to take their pets while they travel. According to LA Traveling magazine, Millions tend to marry later, and often spend a vast amount of money on their pets (Forbes, 2019).

Analysis

Political

A robust legal framework protects property rights and improves business acumen. Political stability will help pet coach in many ways including traveling, tax payments.

Economical

In terms of Business Confidence, Mauritius has moved up the ladder to 161.60 index points in 2019. The average compensation for labour has increased by 5.1 percent (Anon., 2019). The literacy rate of Mauritius is 93.16 percent (UNESCO, 2016), having educated and well-spoken staff and employees will prove to be beneficial tothe business.

Social

Poverty and inequality is not a serious challenge in Mauritius which means the residents are not too poor to afford pet care services. Moreover, the government of Mauritius contributes a lot to social inequality and social justice, enabling businesses and service providers a safe and secure environment, social benefits will help pet care expand its business further.

Technology

Smart cities and techno parks is another pillar, which the government believes can assist inturning Mauritius into an intelligent island. Pet Coach is a mobile pet care service provider and is directly associated with technological improvement in the country.

Legal

Intellectual property rights are protected in Mauritius by the Trademark act of 2002 (Bheenick, 2018) making it secure and safe for pet coach to purchase new assets. According to Mauritius workers’ law, 2019 monthly salary of an employee must not increase MUR 50,000 (except for some sections), and an employee shall not work more than 12 hours a week (Yuen, 2019). Pet coach will provide its employees all the required and legal incentives.

Environmental

Environmental protection Act of Mauritius is responsible for assessing and reviewing environmental regulation. Pet Coach will abide by the rules . Tropical cyclones can cause damage to property. However, there is a system of warnings and Pet Coach will adhere to the advice issued by local officials (Environement, 2019)

3.0 Industry analysis

Some of the noteworthy trends in Pet care industry:

Pet Parenting

Pet owners are treating and taking care of their pets, like family members. Pets provide companionship to their owners. Pet care and Pet products are associated with pet humanization because pet owners want to buy similar products and acquire the best services for their pets as they would for their child. Pet humanization gives rise to other trends in the pet industry. Few examples of pet humanization are per-friendly traveling service, therapy sessions, opulence grooming routine. (INTERNATIONAL, 0CTOBER 2016)

Pet Obesity

Obesity research done in the United States by the Association for Pet Obesity Prevention (APOP) found that almost 35% of the dogs and about 28% of the cats in the US are obese. The pet obesity is the cause of inappropriate human food provided by pet owners, not having a proper exercise routine, and too much eating. (INTERNATIONAL, 0CTOBER 2016)

Premium Products

Pet premiumization means getting the premium level products for pets. Consumers who demand premium products and tools for their pets are middle class and urban living pet owners. (INTERNATIONAL, 0CTOBER 2016)

Source: Globeenewswire.com

3.1 SWOT

STRENGTHS

First-ever mobile application-based Pet grooming and Pet care platform in Mauritius
Managing the business will be easy as most of the time, pet-sitters will be traveling places, which reduces the operating cost.
No inventory; this reduced the cost of business.
Pet grooming tools and products are easily accessible on e-commerce platforms.

WEAKNESSES

Establishing a brand name for any new business is a hurdle. Marketing and Advertisement will help overcome this problem.
Initially, getting your business started could be very costly. Having a low budget will prove to be a big hurdle.
Having strong business links and PR (Personal relations) is essential. It might take time to establish ties with clients and locals.

OPPORTUNITIES

The increasing use of the mobile and internet will make it much easier to reach out to new customers, making it easy for business expansion.
Increase in Business confidence (Economics, 2019)
Turning passion into profit. Being a pet enthusiast could be profitable and a great opportunity for business.
Once the business has successfully made a brand image, then further franchising to other passionate pet groomers is another opportunity to grow business further.

THREATS

Increasing competition
The higher cost of services (Economics, 2019)
Volatility in the exchange rate
An already established business might start providing mobile-based facilities as well (copying our business idea)

4.0 Financial analysis

One thing is clear that there would always be a demand for organizations and individuals pet owners whose demand is extra coaching and grooming for their pets. That is the primary reason why Pet grooming and training will still be required. To start-up capital estimated for Pet Coach is 2.3 million MUR (USD 53,000), which constitutes of 1.3 million MUR loan from a bank and 1 million MUR is personal deposits and some loans (from relative and family members).

One of our primary goals of initiating the Pet Coach is to start a business that will survive off its cash flows without the need for financial resources from outside sources once the business is officially running.

4.1 Investment Outlay

Total number of employees 20	Employee wages per month 35,000 MUR 700K total
Advertising and Marketing Billboards, Social media marketing	40,000 MUR
Transport (10 bikes and twotrucks)	300,000 MUR 670,000 MUR
Tools and equipment	100,000 MUR
Tax and legal payments	50,000 MUR
Inventory and warehouse	200,000 MUR
Total	2 million MUR

Source: self-work

Generally, for Pet grooming and Pet sitting, prices are charged on an hourly basis, but Pet Coach’s pricing strategy is different. They will charge a flat fee for the service, except for, few cases which may require different pricing. E.g., Pet Coach will invoice 700 – 800 MUR for pet sitting. Additionally, if the client needs 24 Hours service or more than 24 hours, the charges will vary. Similarly, during holidays prices charged shall be a little higher than usual due to excess demand for service. Keeping in mind that there would be some clients who wouldn’t mind paying extra bucks for their pet routine and grooming and for that Pet coach has established a premium and tailored services, according to clients’ needs. The Payment policy will be entirely inclusive. Payments transaction shall be accepted via Bank Transfer, via Cheques, via Mobile Payment and Cash payment.

5.0 Exit

Pet caring is considered a “hot” opportunity for business start-ups. But, in a situation where the business doesn’t go as planned, the pet coach has an exit strategy.

Merge with an already established business. Sell 51% of the business shares and the controlling power.
Complete sell-off to another firm or business who will acquire the management as well as the capital of the business.

6.0 Conclusion

As per the report, it is concluded that Pet Coach is a viable business opportunity. Bringing a revolutionary and to the Mauritius market. It will prosper in the future as the business is technology-driven, and the targeted audience is expatriates and tourists. With extensive research and business strategies, Pet Coach has the know-how of consumer taste, preferences, and, most of all, customer needs. With PESTEL analysis on the front, the business will be sustainable in the long run producing more jobs to the locals and expansion of business opportunities.

Appendix

Potential of New entrance

§ Initial cost is low

§ Tools and products are easily accessible.

§ No barrier to entrance

Power of Customers

§ High customer loyalty

§ Pet coach has different service identity

§ No mobile pet grooming in Mauritius

Power of Suppliers

§ Higher number of suppliers

§ Similar products are available

§ E-commerce platforms provides variety of tools and equipment

Threat of Substitutes

§ Online available free platforms

§ Freelance pet care business

§ Veterinary shops

Competition in the industry

§ Pet industry is growing

§ People are fond of conventional pet shops

§ Well-known retailers

7.0 REFERENCES

Anon., 2019. Statitics Mauritius. [Online] Available at: ttp://statsmauritius.govmu.org/English/Publications/Pages/Prod_Comp_Yr08-18.aspx[Accessed 19 March 2020].

Bheenick, S., 2018. Mauritius – Protecting Intellectual Property. [Online]
Available at: https://www.privacyshield.gov/article?id=Mauritius-Protecting-Intellectual-Property[Accessed 19 March 2020].

CEIC, 2020. Economic Indicators Mauritius. [Online] Available at: https://www.ceicdata.com/en/country/mauritius[Accessed 9 March 2020].

Climate Change, M. o. E., 2017. Environmental regulations under EPA. [Online]
Available at: http://environment.govmu.org/English/legislations/Pages/Environmental-Regulations-and-Standards-under-EPA.aspx[Accessed 9 March 2020].

Economics, T., 2019. Mauritius Business Confidence. [Online] Available at: https://tradingeconomics.com/mauritius/business-confidence[Accessed 10 March 2020].

Economics, T., 2019. Mauritius Labour Cost. [Online] Available at: https://tradingeconomics.com/mauritius/labour-costs[Accessed 10 March 2020].

Economics, T., 2020. Mauritius Personal Income Tax. [Online] Available at: ttps://tradingeconomics.com/mauritius/personal-income-tax-rate
[Accessed 10 March 2020].

Environement, M. o., 2019. Environmental Law and Prosecution Division. [Online]
Available at: http://environment.govmu.org/English/Department%20of%20Environment/Pages/Environmental-Law-and-Prosecution.aspx[Accessed 19 March 2020].

FactBook, C. W., 2020. Mauritius Economy 2020. [Online] Available at: https://theodora.com/wfbcurrent/mauritius/index.html[Accessed 9 March 2020].

Forbes, 2019. Americans Spending Billions On Pet Travel And Boarding. [Online]
Available at: https://www.forbes.com/sites/michaelgoldstein/2019/02/22/americans-spending-billions-on-pet-travel-and-boarding/#6567b08724f7[Accessed 19 March 2020].

Freedom, I. o. E., 2019. Mauritius. [Online] Available at: https://www.heritage.org/index/country/mauritius[Accessed 10 March 2020].

Index, T., 2018. Mauritius Report. [Online] Available at: https://www.bti-project.org/en/reports/country-reports/detail/itc/mus/itr/esa/[Accessed 10 March 2020].

Institute, O. D., 2019. Mauritius Economic Conditions. INTERNATIONAL, E., OCTOBER 2016. Because they’re Worth It: Pet Care Global Overview, s.l.: s.n.

Markets, R. a., 2019 – 2025. MICE Tourism Market.

Ministry of Technology, C. a. I., 2019. Digital Mauritius 2030. [Online] Available at: http://mitci.govmu.org/English/Documents/2018/Launching%20Digital%20Transformation%20Strategy%20191218/DM%202030%2017%20December%202018%20at%2012.30hrs.pdf
[Accessed 10 March 2020].

Trade, D. f. I., 2015. Overseas Business Risk- Mauritius. [Online] Available at: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/818828/Overseas_Business_Risk_-_Mauritius.doc[Accessed 9 March 2020].

UNESCO, 2016. countryeconomy. [Online] Available at: ttps://countryeconomy.com/demography/literacy-rate/mauritius[Accessed 19 March 2020].

Yuen, F. Y. S., 2019. Workers’ Right Act 2019. [Online] Available at: https://www.dtos-mu.com/mauritius-employment-law-update/[Accessed 19 March 2020].

COST OF CAPITAL – VOSSLOH

MANAGEMENT ETHICS & LAW Assessment

Assessment Answers

Pages:8

Individual assessment Case study 1

Your company is currently discussing a contract for the construction of solar panels with the Government of Vindalubia.
Your company is requested pay a motivation fee for the Minister of Energy of Vindalubia in order to facilitate the signature of the contract with the Government of Vindalubia.
The CEO of the company asks you to look into this issue.
Do you pay the motivation fee? Why? What are the legal aspects you will take into consideration in order to justify your decision?
Please prepare a document explaining your decision, your arguments and the legal reasons for your decision

Assessment Case study 1 Answer

We will disagree with paying the motivation fee and considering it as bribery. We will notify the CEO. An act done with an intent to give some advantage inconsistent with official duty and the rights of others. It includes briberybut is more comprehensive;because an act may be corruptly done, though the advantage to be derivedfrom it be not offered by another, this is considered as well as corruption.

The forms of corruption are diverse in terms of who are the actors, initiators, and profiteers, how it is done, and to what extent it is practiced.

The Convention does not utilize the term “active bribery” (to avoid it being misread as implying that the briber has taken the initiative and the recipient is a passive victim). Moreover, that could lead the further company dispute.We will also refer to The OECD Convention.

Article 1

Each Party shall take such measures as may be necessary to establish that it is a criminal offense under itslaw for any person intentionally to offer, promise or give any undue financial or another advantage,whether directly or through intermediaries, to a foreign public official, for that office or a third party,so that the official act or refrain from acting concerning the performance of official duties, from obtaining or retaining business or another improper advantage in the conduct of international trade.

We will refer to the United Nations Convention of 2003 Convention Against Corruption

Active and passive corruption by a public official

Passive corruption or bribery has been described as the acceptance of any undue advantage by a public official in exchange for performing a corrupt act relating to his or her public functions. Active corruption could be described as the granting of any undue advantage by a public official for himself or herself in exchange for performing an act of fraud relating to his or her public functions. Both offenses can be committed either directly or indirectly.

Article 15

The article prohibits passive and active corruption and mandates the States to take measures to establish as criminal offenses.

The elements constituting rushing offense are those promising or offering or giving something to a public official.
An undue advantage may be something tangible and intangible, whether monetary or non-pecuniary. The unfair advantage, however, must be linked to the official’s duties.
Passive bribery requires soliciting and accepting the bribe to constitute an offense.

The primary reason for my decision against the payment of the above mentioned ‘motivation fee’ is that the demand or the ‘request’ for the amount of such a sum of money for the facilitation of the business contract falls in the domain of bribery. The demand for a motivation fee is an attempt of solicitation and extortion from the office of the Minister of Energy to enable the company to construct solar panels with the government of the country. Solicitation is defined as the ‘demanding of a bribe, whether or not coupled with a threat if the demand is refused.’

Resisting such demands and ‘requests’ of solicitation and extortion are imperative for the leadership and executive management of the company to foster and maintain a culture that promotes and encourages ethical and moral business practices within the organization. Apart from the moral and ethical obligations, specific legal considerations also call for the resistance against attempts of solicitation for securing business contracts. One of the major international projects that are aimed at enabling the companies and businesses to resist solicitation during business transactions is the RESIST Program, which is a joint venture between the ICC, UNGC, PACI, and Transparency International (ICC, 2019).

Individual assessment Case study 2

Your company signed a contract for the construction of solar panelswith
the Government of Vindalubia (fictitious state).
Your company paid a ‘motivation fee’for the Minister of Energy of Vindalubiato facilitate the signature of the contract with the Government ofVindalubia.
A few months later, the Government of Vindalubia terminated the
The CEO of the company is really concerned about this issue. CEO asks you to look into
What should the companydo?
What are the methods of resolving the dispute?Why?
Pleaseprepareadocumentexplainingyourdecisionandthereasonswhy? you propose your answer.

Assessment Case study 2 Answer

International business contracts and transactions are incredibly susceptible to a range of global factors and influences that can easily result in the termination of such agreements. It is, therefore, imperative for a company to prepare and plan for conflict resolution in case of international business contracts, especially in the context of dealing with a foreign government. A dispute resolution clause is a vital aspect of a global business contract that outlines the steps and legal procedures that need to be taken to arrive at a possible and viable solution to the conflict.

The company should verify that contract in detail. The contract should be sufficiently precise so that difficulties of complying with the contractual provisions are unlikely, but also flexible enough so that foreseeable contingencies fall within the scope of the agreement. If the company desires an ongoing commercial relation, they may wish to specify that disagreements be initially addressed by re-negotiation, mediation, or conciliation, or other forms of dispute resolution mechanisms as an alternative to court or arbitral proceedings.

A well-drafted contract will also contain a clear and precise clause specifying the dispute resolution technique agreed upon by the parties.

International arbitration is the most common way of solving international business disputes.If the company failed to provide for a specific dispute-resolution mechanism in their contract, they might try to agree after a dispute has arisen.

One of the most fundamental and significant ways, in order to solve business conflicts and disputes between contracting parties, is through the process of international arbitration. It is considered to be more effective in the context of decision enforcement than litigation in the instance of a global business conflict. The company should discuss the possible terms and aspects of an arbitration process with the officials and representatives of the government of the country. The two parties should decide on which arbitration rules and frameworks to follow to solve the business conflict. Some of these arbitration rules include the

UNCITRAL Model,
Washington Convention,
ICC Arbitration Rules etc.

Apart from deciding the governing rules, the parties should also agree on other aspects of the arbitration process, including the choice of arbitrators, the duration and obstacles of the process, and the place of arbitration. Additionalprocedures for solving the business dispute include negotiations, the establishment of a dispute review board, conciliation and mediation,etc. However, reaching an agreement on elements such as the place of arbitration, the applicable law to the merits of the case, and the selection of the arbitral institution and the range of the arbitral tribunal may be complicated(Redfern & Hunter, 2004).

Individual assessment Case study 3

You recently joined your company as the Chief Compliance
The company is a medium-sized company based in Riyadh doing business in the construction
TheCEOofthecompanyisreallyconcernedbecausetheCompanydoes nothaveaComplianceandEthicsTheCompanypreviously haddifficultexperiencesinnegotiatingcontractswithnewclientsand subcontractors.
TheCEOasksyoutoproposeanewComplianceandEthicsProgrammetobediscussedatnextTheCEOalsowantsyoutomakeproposalsforaCorporateGovernanceofthecompanyifthiscanfacilitate thesettingupof thenewComplianceandEthicsProgramme.
Please prepare a document detailing your proposed Compliance and Ethics Programme and a new Corporate Governancestructure.
Explainthereasonsforthisnewprogram,theobjectivesandthelegalbackground.

Assessment Case study 3 Answer

The establishment of an effective corporate governance structure is necessary for the compliance and ethics program to function efficiently. Some of the proposals for corporate governance are as follows;

Establish clear Vision and Mission and Values to be communicated through all levels of employees.
Establish clear objectives and goals
Establish clear measures for evaluating the performances of senior managers and executives of the company.
Most of the members on the board of directors of the company should be independent actors. An independent nomination committee and a distinct process for monitoring the performance of the directors should be established.
Policies should be drafted to develop a clear and distinct code of conduct for the company. The system of conduct should serve as the guiding framework for all business decisions and activities of the organization.
An independent audit committee should be set up to maintain the integrity and transparency of the financial activities of the board and the organization’s business dealings.
A capable communications team should be established with the sole objective of disclosing all the relevant data and information regarding company activities to the shareholders in a timely and efficient manner.
An independent remuneration committee should be established that designs and maintains fair and just compensation procedures for higher management (ASXGC, 2007).
A Risk Management Committee should be setup, The Committee should have overall responsibility for monitoring and approving the risk policies and associated practices of the Company. The risk management committee will also be responsible for reviewing and approving risk disclosure statements in any public documents or disclosures.

The establishment of a corporate governance structure along with a compliance and ethics program will help in developing a code of conduct for the company, which will govern and monitor all organizational policies and practices. The primary objective of the ethics and compliance program is to effectively protect and safeguard the interests of all the stakeholders associated with the organization. The program will not only enable the employees to carry out their work practices in an effective and ethically compliant manner, but it will also facilitate the shareholders of the company and streamline the business practices with their interests by establishing values of transparency, integrity and disclosure. The corporate governance structure and the compliance and ethics program will also help with the effective planning and implementation of risk management practices (Jackson, 2010).

The Organization for Economic Cooperation and Development (OECD) has developed a framework for organizations and business that provides a guideline for establishing compliance and ethical practices within the company. Such principles include development and promotion of transparent and effective policies and business strategies, clear and distinct division of responsibilities, protecting the interests and rights of shareholders, ensuring the equitable treatment of all stakeholders of the company, provision of equal opportunities to all shareholders to obtain effective redress in case of violation of their rights, ensuring effective and efficient disclosure and transparency practices, establishing monitoring and evaluation mechanisms and accountability activities within the company, and ensuring that the board of directors and the managerial leadership of the company performs its duties effectively (OECD, 2004).

References

(2007). Corporate governance principles and recommendations.
(2019). Resisting Extortion and Solicitation in International Transactions (RESIST). Retrieved December 30, 2019, from ICC – International Chamber of Commerce website: https://iccwbo.org/publication/resisting-extortion-and-solicitation-in-international-transactions-resist/
Jackson, G. (2010). Understanding corporate governance in the United States: An historical and theoretical reassessment. Arbeitspapier, Unternehmensmitbestimmung und Unternehmenssteuerung.
(2004). The OECD principles of corporate governance. Contaduría y Administración, (216).
Redfern, A., & Hunter, M. (2004). Law and practice of international commercial arbitration. Sweet & Maxwell.
https://www.sec.gov/Archives/edgar/data/1067491/000106749107000015/exv15w07.htm

Cookie	Duration	Description
cookielawinfo-checkbox-analytics	11 months	This cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Analytics".
cookielawinfo-checkbox-functional	11 months	The cookie is set by GDPR cookie consent to record the user consent for the cookies in the category "Functional".
cookielawinfo-checkbox-necessary	11 months	This cookie is set by GDPR Cookie Consent plugin. The cookies is used to store the user consent for the cookies in the category "Necessary".
cookielawinfo-checkbox-others	11 months	This cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Other.
cookielawinfo-checkbox-performance	11 months	This cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Performance".
viewed_cookie_policy	11 months	The cookie is set by the GDPR Cookie Consent plugin and is used to store whether or not user has consented to the use of cookies. It does not store any personal data.