Tom Szaky's Extraordinary Vision and Business TerraCycle - Case Study Example

? Business Biography Contents Contents 2 Biography – Tom Szaky 3 About the Business 4 Industry Overview 5 Competitor Analysis 6 Market Trends 6 Specific Application of Concepts 7 Learning from the Entrepreneur 8 References 10 Biography – Tom Szaky Tom Szaky is the founder of the company named TerraCycle Inc, which is based in USA. He is a serial entrepreneur by nature and is credited with being the first entrepreneur to establish a company which focuses on the point of developing of materials which are being produced by the efficient usage of waste management. Tom Szaky was born in Hungary in the year 1982 and immigrated to Holland and then to Canada. At the tender age of 14, he focused and concentrated his efforts towards the development and growth of his first entrepreneurship venture, which was a web design company in the name of Flyte Design. The SME venture by this young first time entrepreneur went forward to win some of the reputed design awards of Canada. Besides Flyte Design, Tom Szaky also diverted his focus towards the establishment of three dot com companies, which ranged from an online home improvement site to an online fund raising school as well as online grade tracking software. In the year 2001, the serial entrepreneur moved to USA for the purpose of acquiring a degree from the reputed Princeton University. However, in 2002, he shifted his focus from academia to the development of TerraCycle Inc. It can be increasingly said that by the process of early venturing into social entrepreneurship through the formation of TerraCycle in the year 2002, he made it evident that he is an agent of change, who is focused on exploiting opportunities that keeps on emerging in the social environment from time to time. However, besides being an entrepreneur, he was active member when it comes to community service. He took initiatives in the participation and organizing of various social activities, while increasingly raising and generating values for the stakeholders (CNBC, 2007). About the Business The main objective of TerraCycle is to focus on waste elimination through the process of application of evolutionary economics. Guided by this particular objective, the company focused on national level recycling chain for waste products that were difficult to reuse and recycle. The company focused on setting up a new principle of generating products of innovative nature as well as of high value from already disposed and utilized products by using organic means. The company recycles the waste for the purpose of product creation which focuses on fulfilling the needs of the clients and consumers, while increasingly enabling them to tackle their demand and subsequent elimination of relative and existing pain points (TerraCycle, n.d). The competitive advantage for this business was the fact that the business was started as an innovative venture and in an almost virgin market, in regards to its product portfolio, that Is being offered to the consumers. Hence it can be said that the business had the first movers’ advantage. As of today’s date, the company is focused on the process of value creation through the process of developing a variety of recycled product. The product variety comprises of a wide range of categories ranging from bags, garden accessories and fertilizers, gift accessories, home accessories, office accessories, school accessories. The product category also comprises of items of daily uses likes toys, pet bottles and even winter based essential products (TerraCycle, n.d ). On an overall note, TerraCycle produces over 250 different kinds of products, from a wide range of waste streams (Forbes, 2011). Industry Overview The United States, due to its focus on high level of consumption by the government as well as the consumers has become the largest market with the urgent need for waste management services. The waste management industry in the United States is a highly fragmented industry. The sector has grown tremendously over the last few years, till the year 2008. The slowdown all over the globe, due to the onset of the economic crisis however, slowed the progress of growth for the waste management industry in the US. The industry scenario for the waste management sector in the US is of highly competitive nature. The market for the waste management services is also highly regulated and is extremely mature in nature. However, it can be said that due to the absence of any major policy changes and introduction in regards to waste management, the sector is currently witnessing a lot of activities, thereby spurring of growth in this sector (US International Trade Commission, 2004, p. 3-1). The industry offers stiff competition and promotes significantly high barriers to entry for new entrants in the market. The advent and emergence as well as development of new technologies in the waste management sector is significantly increasing the efficiency as well as recycling abilities of the waste management firms. In the US market, the principal practices for the purpose of dealing with waste management, disposal as well as recycling increasingly comprises of the practice of land filling. Other practices for dealing with waste management comprises of the process of composting as well as incineration. Competitor Analysis As per the availability of statistical data, around more than 20 million consumer in the northern part of the United States is dependent on the services offered by the Waste Management, which is the largest and one of the major players in the waste management sector (Waste Management, 2011). The other major players in the US market, who are essentially dealing with the services in regards to waste management, are Republic Services, Phillip Services, Clean Harbors etc. However, it has to be increasingly taken in to account that the US waste management sector being a highly fragmented one, a lot of small and medium enterprise companies exists which essentially provides waste management services apart from dealing in the recycling process for the purpose of value creation for the customers (US International Trade Commission, 2004, p. 3-2). Market Trends The market trends for the waste management sector are highly interesting in nature. The waste management industry experiences its occasional peaks and troughs of the business cycle of the sector with regards to the elasticity of demand theory that is being prevalent in this particular sector. The sector is dependent on the supply of waste generated on a whole and the relative amount of waste materials that is being recycled by the multiple players in the industry. The other factors that can play a major role in the process of influencing of the business in this particular sector increasingly comprises of the gross domestic product and the economic position of the country, the mass and social awareness and concerns with regards to environmental needs for a particular area or country. Also, another important factor that can play a major role in the process of influencing the market trends increasingly comprises of the availability of various land filling sites in a country or area as well as the general response of the masses with regards to using it (Koncept Analytics, 2010). Specific Application of Concepts It is of high importance to mention that the TerraCycle made its progress through the process of a bootstrapping venture. It has to be increasingly taken into account that the entrepreneur repeatedly made investments in the business, by the process of earning awards at various business competitions and reinvesting them for the purpose of further growth. TerraCycle also used a lot of strategy in its approach to successful waste management at a highly economical rate. The firm focused on generating a unique competitive advantage by the process of using the first movers advantage of making recyclable product for the end consumers and making them available at a very cheap rate in the market place. TerraCycle also focused on the principal of 10 x. The company focused on being larger by the process of diversifying in an attempt to generate creation of value for the end consumers. The firm also focused on creative destruction, by increasingly focusing on the process of building products by recycling waste resources. TerraCycle’s products increasingly focus on the process of value creation for the customers using the minimum value product or mvp principle. The products are extremely cheap and provides a good value for money for the consumers TerraCycle follows a highly interesting strategy of growing by attempting scalability of operations. The company highly focuses on the process of generating profits through economies of scale, while at the same time keeping a check on the fixed costs as well as variable costs. Learning from the Entrepreneur It has to be increasingly taken into account that the entrepreneur, Tom Szaky is a person of extraordinary vision. Throughout his streak of entrepreneurship, his main focus was to generate and deliver value for the stakeholders, which comprised of employees as well as clients. He is a man of high adversity quotient. This is evident because even in the face of extreme case of possible bankruptcy, he refused to make the TerraCycle, merely a firm focusing which has its focus only on the process of wealth creation, rather than having a social advantage. It has to be increasingly mentioned that Tom Szaky have the much needed entrepreneurship traits, which increasingly comprises of the characteristics like desire to achieve, ability to perform and undertake hard work as well as focusing on excellence. Also, it can be said that this entrepreneur is a strategic risk taker and focuses on calculating the risks and returns associated with his undertaking of the risks. It can also be noticed that Tom Szak has a trait of accepting of responsibility and focusing on the process of value creation, value distribution and value capture to the related stakeholders in all his entrepreneurial attempts starting from Flyte Design to TerraCycle. Besides, being an entrepreneur, who is focused on taking well calculated risks after weighing out the associated challenges and rewards, it can be said that Tom Szaky is also a highly efficient judge in the process of identifying the opportunities characteristics and nature. He provided an excellent display of his opportunity analysis skills by the process of leaving his academic pursuits in Princeton to be an early starter in the waste management business and thereby gaining on the opportunity related to the early movers’ advantage. By implementing this strategy, the founder as well as the company TerraCycle was able to generate the maximum amount of opportunity by capitalizing on the industry attractiveness that was associated with waste management sector. TerraCycle also gained a significant amount of leverage by entering the industry at the right time. He also focused on making an opportunity out of an adversity by the process of recycling hard to dispose of waste resources for the purpose of providing minimum value products to the customers at an increasingly low price. References CNBC.com, (2007). Iam.cnbc.com Retrieved from http://www.cnbc.com/id/24880307/ TerraCycle, (n.d). About Us. Retrieved from http://www.terracycle.com/en-US/about-us.html TerraCycle, (n.d). Products Index Retrieved from http://www.terracycle.com/en-US/products.html Forbes.com, (2011). Forbes' List of the Top 30 Social Entrepreneurs Retrieved from http://www.forbes.com/sites/helencoster/2011/11/30/forbes-list-of-the-top-30-social-entrepreneurs/ Waste Management, (2010). Annual Report 2010. Retrieved from http://thomson.mobular.net/thomson/7/3186/4451/document_0/WM_2010AR_rev.pdf Koncept Analytics, (2011). US Waste Management Industry: An Analysis Retrieved from http://www.konceptanalytics.com/reportDetail.aspx?reportID=170 US International Trade Commission, (2004). Solid and Hazardous Waste Services: An Examination of U.S. and Foreign Markets, Inv. 332-455. USA: Diane Publishing Read More