Essay About Information Asymmetry And Main Reason

Strategic Management
[pic 1]BU035-INNOVATION AND ENTREPRENEURSHIPAssignment-1Individual Assignment case analysisNAME : Dadi RanjithSubmitting to: Simon Cope  How and why was the business opportunity created? They are remaining on their property for a long time and has been utilizing natural cultivating practices, however they were all the while utilizing the cleaning and body care items through it was understood that numerous were presented to poisonous chemicals . Therefore, ecostore was conceived. “Two reasons interested in eco-productsThe main reason in enthusiasm for ecostore is that Rand thought he could locate a substitute for the non-eco-replacing so as to accommodate items utilized then them with the normal eco-accommodating substances where they could have no lethal effects.The second reason in hobby is he supposes when the general population met with a worldwide emergency on ecological awkwardness at the season of green development on account of the use of hurtful material R and then thought to utilize the recyclable items so he could make another thought which could utilize the current assets as opposed to making the new things which had a more noteworthy measure of terrible effect on individuals and the earth also. Eco-store has been able to connect with their target customer base with their by applying sustainable environment principles while manufacturing their products and at the same time adding value to the customer and ensuring there is no compromise on the quality of their product. Eco-store’s policy of minimizing the carbon foot print as much as possible along with their full disclosure policy by declaring the ingredients of each and every Eco-store product has created a tremendous amount of good will and brand value for the company especially among the environmentally conscious customer base. This has resulted in the rapid expansion of operations for the organization in the last couple of decades.[pic 2]Explain the concept of ‘information asymmetry’. How does this concept create an opportunity in the context of the Eco-store case?There will be at least two parties in a transaction and information symmetry happens when both the parties have the same information levels which will preclude one party having advantage over the other during the transaction. Information asymmetry is the exact opposite of this scenario.All the major FMCG companies have a uniform policy of not providing the list of ingredients that they use in their products since it is not mandatory to do so in Australia and New Zealand. This has resulted in lack of awareness among its consumers about the possible side effects that could be incurred by using these products. This is a clear case of information asymmetry as the manufacturing organization has more information compared to the end user.