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Funding
As the firm grows, it requires a large amount of money to operate as the basis of serving the customers. In the beginning, Lush is private owned by Mark and Mo Constantine but with a small number of shares, with the expanding of the firm, Lush gradually relied on the funds of partners in the team, Andrew Gerrie one of the Lush partners said that Lush is funded by a team who started the business together with funds from a wealthy investor (Startups, 2002).
Innovation of Lush
It is important for the entrepreneur to have a good venture idea for running a business. Therefore innovation penetrates the whole process in the venture. Trott (2008) believes that innovation= theoretical conception + technical (or process) invention + commercial exploitation. For lush company, their business idea comes from the interests of Mark Constantine and Elizabeth Wire in beauty therapy, then they developed many recipes and sold them to other companies until 1976, they contracted with The Body Shop as one of their suppliers (Wikipedia,2012). For an entrepreneur, the innovation is not always a continuous process which will be influenced by the dramatic changes in the market, social, technology as well as the regulatory environments (Paul Burns, 2011). In order to keep innovative, in 2003, Lush company launched a new beauty brand and retail concept, B Never Too Busy To Be Beautiful, there are only four shops of this brand located in UK, (Journal of MarketWatch, 2003). By keeping the small numbers of stores with a unique location, Lush could increase the desirability of products to customers and encourage the existing-consumers loyalty (Marketline, 2008). It is believed that in the future, Lush would emerge much more creative brand to satisfy the customers.
Stick to the original focus
In the intensive competition of the market, entrepreneurial ventures would come across the risk of takeover by the leader of the industrial, some of the firms will agree on takeover in order to make profits, for instance, Bees by Clorox, and The Body Shop by L’Oreal (Marketline, 2008). But, Lush still insist its independence and avoids any demands for takeover. What’s surprised me is that, as the best suppliers for The Body Shop, Mark and Mo Constantine didn’t give into the compromise of Anita Roddick, founder of The Body Shop. "If you were going to sell the leading ethical company in the world, there couldn't be a much worse choice than L'Oreal," (Mark Constantine quoted in Financial Times,2007). This comments showed that in order to retain their original focus, they will never accept takeover, and only the independent operation can facilitate the advancement of their brand.
Recognizing and coping with risks
It is believed that entrepreneurs are more intended to make decisions through the different using of information or employing heuristics and rules, depending on their instincts and intuition (e.g., Schwenk, 1986; Cooper et al., 1995; Forlani and Mullins, 2000). Therefore, it is important to recognize the risks of starting up the business.
For Lush company, the previous years, the manager in the store have to forecasts the products demands for deciding the amounts of products, the lack of accurate predicting generated the risks of lost sales and lower customer services(Prophix, 2012). However, they uses the retro part of website to make sure the producing quantities of products based on the customer’s reservation, which greatly save the costs of sales to a great extent.
Furthermore, since The Body Shop has been taken over, Lush has to consider its risks of being taken over by leader of cosmetic industry, while Mark Constantine considered forming a staff ownership scheme for its company, which can prevent the business takeover Lush to some extent (Marketline, 2008). Although it is agreed to make the staff become the stakeholders in the company, Mark Constantine does not approve to turn Lush into a public company due to his untrusting of shareholder’s decision-making capability. "If a business goes public it has to consider its shareholders above all else. I realize the people you can trust most are your own staff," (The Guardian, 2007). It is a controversial issue that the staff may lack the ability to make a good business decisions.
Learn from Mark Constantine- the successful entrepreneur
As an entrepreneur, the personality plays an important role in growing the business, the second resource indicates five personality factors of an entrepreneur, namely extraversion, openness to experience, agreeableness, conscientiousness and emotional stability (Barrick etal., 1991). Constantine shows those traits through his success of Lush.
Hiring strategy------ employ those who are passionate, enthusiastic, ethical.
Never being frightened----- Mark Constantine once stated that “ I went through a period when I was a bit frightened of the business. People who have very corporate businesses are rather frightened of them. If you’re frightened you’re constantly putting in layers and fiddling about because you don’t know what you’re doing”, (Kate Walters, 2010).
Creativity----- Lush holds 38 patents and Mark is proud of his focus, the continual supervising of products makes the company less vulnerable to innovative competitors (Kate Walters, 2010).
Specific makes the entrepreneurial venture success
Sheth et al (2000)state: “The fundamental precepts of marketing remain unchanged, but more attention must be given to specific areas, such as customization and one-to-one approaches”, which indicates the entrepreneur should follow the structure of the business and concentrate on the specific issues. Indeed, Lush’s intense focus on customization, innovation of products and dynamic methods of promoting bring benefits of growing its business and facilitate the victory of the market.
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