Envirofit Company Essay
1. It is appropriate to consider Envirofit to be a social enterprise because their main focus is innovation, risk taking, and large-scale transformation to solve social problems. Envirofit is doing so by bringing sustainable clean energy solution to solve health and energy challenges on a global level at the lowest possible cost. They are combining resources while exploring and exploiting opportunities to create social value by stimulating social change or meeting social needs. They are meeting the needs of the present without compromising the ability of future generations to meet that need. In this case the need is clean air. Envirofit’s approach to shared value is to make a difference by focusing on energy and pollution reduction, and health and economic improvement. They wanted to create and economical value and also create value for society by addressing its needs and challenges. Envirofit hoped to reduce pollution by developing commercializing a retrofit kit that dramatically reduced emissions in dirty two-stroke carbureted motorcycle engines. Their approach was to transform their business thinking, recognizing societal weaknesses and create a way of solving both. The social problem Envirofit is attempting to solve is air pollution while increasing the income of the drivers through increased fuel mileage. Envirofit offer it’s investors a good reputation and a triple bottom line by giving them the chance to go beyond the traditional measures of profit but also include environmental and social dimensions. They would be more focused on profits, people, and the planet instead of just profits.
2. The Envirofit’s two stroke motorcycle engine conversion kit described as being targeted at the “base of the pyramid” because the taxi drivers are considered micro-entrepreneurs; using the small amount of money they earn to support their families. They typically earn $3-$5 per day after all their expenses. These drivers are in the largest and poorest socioeconomic group. The impact this has on Envirofit’s business model is that it would be challenging to find ways so that the drivers can purchase the kit at a reasonable price. It would be challenging to come up with a business model that would meet their triple bottom line objectives, allow for scalability, and provide the ability to raise start-up capital. The factors that they need to take into consideration include: the market, the customer, and the competition.
3. One of the biggest obstacles to be overcome would be developing a business model that would enable them to sell to customers in base of the pyramid markets and meet their triple bottom line objectives. Finding a way that motorcycle drivers could afford the projected price of the kit ($220), which is a significant money to the drivers because they make less than five dollars a day, little money saved, and little access to commercial credit. They would also need to learn the market, manufacturing, finance, regulatory, and cultural issues that the venture would face. Another obstacle is to provide a kit that would be commercially available, durable, and reliable. It also needs to have less power draw on the motorcycle and easy and inexpensive to install.
4. If I was offered the opportunity to join the venture as one of its key members, I would evaluate the long term impact of the venture. If it’s something that has the potential to make significant changes in the environment especially in third-world countries, I would definitely accept the offer. From what I read, it all sounds like a great plan but it needs lots of work and effort and I would definitely make the sacrifice because I think it would pay off in the long run.
5. I would look for start-up capital among the members of the ventures before looking anywhere else. It is very important for the members to invest first that way they can show potential investors that they are serious about their venture. I would also turn to nonprofit organizations and large corporations that are interested in making profits as well as helping the environment.