case study

Case Study Analysis (10 Marks) GETTING TO KNOW TONIA JAHSHAN OF STEEPED TEA On a vacation getaway in 2006 to a bed and breakfast in Mahone Bay, Nova Scotia, Tonia Jahshan and her husband, Hatem, tasted loose-leaf tea for the very first time. They liked it so much that they brought some home to share with friends and family. Before Tonia knew it, she was holding fifteen tea parties a month. Started in 2006, Steeped Tea sells loose-leaf tea and accessories. The company began with minimal investment. The couple bought their teas in small quantities and stored them in their garage. They grew the business by using a direct-sales model whereby they sold their tea through independent consultants rather than building their own sales force. Mostly women working part-time, these consultants are independent business owners who run tea parties in people's homes. Some consultants today make up to $21,000 a month in commissions. A turning point for the company was when the couple appeared on Dragons' Den. Their venture capital pitch resulted in four offers. Dragons David Chilton and Jim Treliving each invested $125,000 for a 10 percent ownership in the company, resulting in an overall $250,000 offer for 20 percent ownership. The owners chose them as Treliving had great connections in the United States- where the Jahshans wanted to establish a presence-and Chilton showed a solid understanding of the company's business model. When Tonia launched the company in October 2006, it was a one-woman show. Since then, the company has grown exponentially. "We went from a basement to a 1,200-square-foot space, to 6,000 square feet and now to 20,000 in three- and-a-half years," Hatem said. The company now has over 5,000 consultants in Canada and 1,000 in the United States. The vision is to have at least 20,000 representatives in Canada, and 10,000 representatives in the United States, and to keep growing Stories about people like Tonia Jahshan, who take on the challenge of starting their own business, are commonplace in this age of the entrepreneur. As you know more about such examples, maybe you will become inspired to become an entrepreneur yourself! Discussion Questions 1. What did the couple tasted for the first time during their vacations? 2. What did they do when they like it so much? 3. How many tea parties Tonla was holding before they knew that new taste of tea. 4. What is the name of the company and what type of product it is selling since 2006? 5. What was the scale of their business and where they stored their product in the beginning? 6. They grew the business by using a direct-sales model. Explain the model and type of work force. 7. What TV program turned their business around? 8. How many offers did they get as venture capital? 9. Explain what was the investment deal that Dragons made and why the owners like that deal? 10. What comparison is discussed between the scale of business when it started and the current position? 11. In what ways Tonia Jahshan inspired you to be your own boss one day