Mosquito Screen Venture Risk Analysis Case

Jesse Fields is a former entrepreneur from the United States and has been fascinated with world cultures. Several years ago he and his partner realized that if they rented out their two properties that they would have enough income to travel around the world. Since then they have traveled to over 152 countries. Fields lives on a $5,000 annuity, and generally spends between $3,000-4,000 on travel and hotel accommodations. Since he began this travel journey seven years ago, he has managed to save around $100,000, which is currently in a savings account earning hardly any interest. Fields has established residency in a country with favorable tax laws, and he currently pays no income tax. Recently, he and his partner have grown restless of the endless travel and have thought about settling down, however, a serial entrepreneur and without the constant traveling, Fields knew that he would get bored quickly in one place and was therefore looking for a project to keep himself busy. Islandia has a population of 25 million people, with a GDP of $100 billion. Most of the revenue comes from tea estates, rubber plantations, manufacturing garments, and a variety of other industrial and agricultural projects. Hospitality and surf tourism are also part of Islandias industry. Islandia also has a positive trade relationship with China, one of worlds largest manufacturers of aluminum, and is home to a deep water port where supplies can be regularly imported. Fields figures that he can if his venture is successful in Islandia, that he could replicate this success across Asia. Fields had thought about a number of business ventures. During one of his recent visits to the island nation of Islandia, located in the tropical region in Asia, Fields realized that mosquito screens on windows was non-existent. He wondered why, and thought this might present a business opportunity. Why were mosquito screens not more available in a country with such a widespread mosquito problem? He knew that not only are they annoying pests, but mosquitos also carry dangerous diseases like dengue and malaria. Fields spoke with a local friend who told him that a few wealthy people did have mosquito screens, (mostly expat families who had spent time abroad), and thought that perhaps some local people might feel that these screens obstruct your view, but wasnt entirely sure. Fields figured this idea about obstructed views might be an issue for some of the higher-end properties overlooking the ocean, but this made little sense to him because in lower-end properties the views were often of the wall of the neighboring home. His friend also seemed a bit confused about the concept of mosquito screens, asking Fields basic questions, such as if you would need screens on all windows or just some? This lack of familiarity made Fields wonder whether it could just be that people were not as familiar with the concept of mosquito screens as they are in in the US, and he began to wonder if with the right marketing he could educate the people in Islandia of the benefits of having screen on doors and windows as a method to keep mosquitos and other insects out of the home. Fields intuition tells him that this could be a good opportunity. He does some initial research and learns that there is a small company on the island that is installing window screens. He wonders why they have not been more successful and learns that this is a company that focuses on a wide variety home improvement concepts. Undeterred, Fields took out his pencil and started to jot down all of the questions that would need answering before he got started on this project. He also reasoned that he would need to understand all of the numbers before committing his life savings into this project. Could he afford to finance this project himself? What would it take financially for him to start a mosquito screen business? Should he manufacture the screens himself, or rely on local or imported suppliers? What are the risks involved with this business? What is the estimated size of the addressable market? Should Fields contract with the local distributor or should he consider importing materials from China? The questions were everything for Fields, as he needed to understand every detail about the market.

1 .Develop a pro forma business plan to help Fields understand all of the relevant costs associated with this business.

2. Does Fields have enough available to finance this business himself?

3.Does he need to seek out a business partner?

4.How do you define the opportunity costs or risks associated with this project?

5. Is there too much additional risk with this project or does this present a viable business opportunity for Fields?