Future Outlook and Raising Capital in the Sports Drink Market

The plan of attack and obstacles to bringing up large(p) and managing early change move make or break a parvenue accompany that is trying to compete for merchandise sh are in the sports beverage industry. According to a recent monthly labor report, to the highest degree new product linees hurl the stovepipe chance of surviving during the eldest both years (Knaup, 2005). The young company must also determine how to best utilize legal services. It is whizz thing a new business take chances should not only consider but plan for. some other area of concern and attention must go to the issue of raising m one and only(a)y to fund the business.The competitive and lucrative sports alcohol addiction commercialise has in the past been dominated by two main players, Gatorade and Powerade. Together they have long held over two thirds of the mart share. However, the future outlook shows that the merchandise is starting to include a wider variety of sports drinks that are tar geting a broader direct of personal needs. LJ Enterprises impart utilize more than one avenue in raising corking. This will attend to ensure the new company is funded head from the start in order to retain it the best chance to succeed. 1. establish the future outlook and industry trends related to the new risk.Future vista and Industry Trends The future outlook for the sports drink industry involves many new companies entering the market and offering different pillow slips of non traditional sports drinks. Gatorade has been leading the market for years but has yet to really come out with a new product. They have pushed different marketing campaigns and tried to repackage their product a bit, but the formula and product remain fundamentally the same. This is where new companies are able to gain ground against the bigger and more established market leaders.One new trend in the industry is to target a item segment of the market such as kids or athletes. The right off disc ontinued product Gatorade Tiger was one way the market leader and our competitor tried to innovate and take advantage of this trend. This product was intemperately marketed to the endurance athlete and team sports. Powerade is now targeting the kid segment of the market with their product called Powerade Play for kids. This product contains 20% of the Daily Value (DV) of tetrad B vitamins, 100% DV of vitamin C, 20% DV of zinc, a trademarked electrolyte system and 25% less sugar (Spano, 2005).Another industry trend beingness seen involves the judgment of nutrient timing. This involves drinking certain nutrients around the time of carnal exertion or exercise to allow for shorter recovery time and for specific needs such as strength training or endurance. So far, this practice has focused mainly on carbohydrates and protein but in the future the trend will be nutrient timing for non-nutrients. The most considerably known sports drink currently involving nutrient-timing are protein based recovery drinks or Ready-to-Drink beverages.LJ Enterprises new product offering, Sore-B-Gone will be a perfect gybe for this emerging market trend. 2. Discuss the legal or concerns related to the venture idea Legal Services and Industry Concerns In most cases the enterpriser will need to harbor his or her intellectual fitty. The practice of get bares, trademarks, copyrights, and trade secrets will ensure this property is protected by the courts and by the services of an lawyer. An attorney can be specialized in one area such as patents or real estate.It is all-important(a) for the attorney and the client to develop a good working relationship. This can sponsor to give the entrepreneur much needed confidence and help to palliate some of the risk of infection launching a new venture. One if the first things a new company will want to do aft(prenominal) hiring the services of an attorney is to have a conversation about patents. more or less of the work will be don e by the lawyer who will work to secure a patent for the new company. In doing this, the entrepreneur gains exclusivity regarding his or her figure for a limited amount of time.The time that the invention or product will be patented depends on which type of patent is acquired. A Utility patent will grant the owner protection for twenty years from other people or businesses fashioning, using, or selling the invention that has been patented. This type of patent usually involves a act such as the mixture of ingredients. It is this type of patent that LJ Enterprises will test in order to protect its intellectual property, such as our drink mixture. Another type of patent is called a design patent. This one has a term of fourteen years and involves the appearance of an object.For example, if a company cute to protect a product or container configuration, this would be the type of patent that would be needed. It will be very important for any company looking to sell internationally to file for an international patent. This will protect the company from unforeseen laws or taxes involving the many different countries. 3. Discuss the memory access and obstacles to raising capital for the new venture. Approaches to genteelness Capital In the start stages of starting a new business venture, the entrepreneur will portray many difficult tasks.One of these tasks will be deciding how to elevation the necessary funds in order to get their product or idea off the ground. The best course may involve one or many sources depending on the business needs and initial capital already available. One easy and logical first step would be to ask friends and family. In most cases this group is excited about their relatives or friends taking on a new venture with the chance of making a lot of coin. However, this approach can damage relationships if certain expectations are not met and/or investment fundss are not paid back as promised.Another problem is that the capital borrow ed is often small and not passable to cover all the initial costs. Another more effective approach is through Angel investors. This group has more money available to give the new business but one of the downsides is they may want a stake in ownership, stock creams, or some other physical body of compensation up front. This will not be an ideal option for the owner who wants full ownership of the company. Yet another option is the criterion bank add. The two key elements to obtaining this type of loan is the business owners personal credit history and having a soild bsuiness plan. It is the ntention of LJ Enterprises to first rent the help of a wealthy uncle with very deep pockets. This initial investment from Uncle Taylor will be around $30,000.A decent sum of money but not passable to do all the things the company ab initio wants to do. The company will also need to try and secure a small business loan from a bank. We will ask for $50,000 in order to cover all the start up costs and to help out with daily living expenses while getting the product launched. Obstacles to Raising Capital One of the major setbacks to getting capital for a new business venture is the huge risk involved with such an undertaking.However, this risk can be somewhat averted if the business owner can compel a good pitch to lenders and managing the money effectively once the loan is secured. Another obstacle to raising capital is not asking for enough money in the first place. In a 2004 U. S. Bank education of reasons for small business failures, 79 percent cited starting out with as well as little money as one of the causes of their collapse (Sugars, 2007) . Other barriers to getting the amount of capital needed are failure to get the proper legal documents, poor cash flow management, having too many lenders, and focussing too much on the idea and not enough on management.LJ enterprises has considered all of these factors and intends to due the quest to increase its chances of being properly funded. low off, we intend to limit our lenders to only two. Secondly, an accountant will be leased to manage the cash flow and overall record keeping. Lastly, the services of an attorney will be utilized from the beginning so that no important legal documents are missed. The company hopes to maximize the chances of gaining its initial capital by following these guidelines. Conclusion Currently one of the most important trends in the sports beverage market is the concept of nutrient timing.It is for this reason that we feel our product, Sore-B-Gone, is being introduced at the right time. It is vitally important to the health and future on the company that the services of an attorney are obtained right from the start. An attorney can not only assist but increase the changes of the new venture obtaining much needed initial capital. If the new company can stay off some of the obstacles to obtaining capital such as managing money effectively and following the advis e of the attorney, the company may just survive and thrive in the marketplace.