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good capital and better world books (a)

ood Capital And Better World B

bmitted to: SIR ASIM ILYAS

bmitted By: Abu Sufyan 12223001

INTRODUCTION
The introduction of Better World Books was the idea of Xavier Helgesen, Chris Kreece
Fuchs, and Jeff Kurtzman, three 2001 graduates of the University of Notre Dame in
which they came up with the idea of selling books online with a parallel mission of nonprofit as mission to fund literacy initiatives around the globe
The case examines the business model of Better World Books (BWB), the US based online
bookseller. Founded in 2002, the company collected old and new books from individuals,
booksellers, recyclers, libraries and colleges. Apart from donations, libraries and colleges also
sold old books to BWB. BWB either donated the collected books to the organizations
promoting literacy or sold them online. By donating and selling used books, BWB helped to
keep away millions of pounds of paper waste from landfills. The books that did not sell were
recycled. BWB also had a Carbon Neutral Shopping Cart, through which, the company
collected two to five cents on the cost of each book from every customer at the 'Checkout'
link on its website. The collected money was used to buy carbon offset to compensate the
environmental impact of shipping by the company and its literacy partners. In the financial
year 2008, BWB earned revenues of US$ 21 million and had a revenue target of US$ 31
million in fiscal 2009.
This idea of approach created social, economic, and environmental value for all stakeholders
in order to create value based company.
To create base for the company, the company acquired its growing inventory of used books
from two primary sources:
The Campus Collection program
The Library Discards and Donations program, working with more than 1,600 college
campuses and about 1,000 libraries nationwide
Better World Book (BWB) started selling books through a variety of established online
marketplaces such as Amazon and eBay and its own retail site known as
betterworldbooks.com
Every order was shipped carbon neutral with offsets from Carbonfund.org, from these orders
and sales, t he company donated 7% to 10% of its revenues to various global literacy
initiatives, l i k e partnering with Books for Africa, National Center for Family Literacy,
Room to Read, World fund, and Invisible Children which were for welfare of the societies
By donating and selling used books, BWB helped to keep away millions of paper waste from
going to waste. The books that did not sell were recycled. BWB also had a Carbon Neutral
Shopping Cart, through which, the company collected two to five cents on the cost of each
book from every customer at on its website.

The collected money was used to buy carbon offset to compensate the environmental impact
of shipping by the company and its literacy partners. In the financial year 2008, BWB earned
revenues of US$ 21 million and had a revenue target of US$ 31 million in fiscal 2009.
The base of company was innovative idea & technologist which led the company to grow so
fast in very short period of time. Over this period their growth rate was tremendously
impressive and during the period of internet boom they captured the idea & market. This is
the reason they kept on investing more funds in developing new technologies for operations
to finance. Considering the bright talent in young people, as the company was founded by
young graduates they also prefer hiring new young minds for new positions.
Better World Books have capacity to grow more and more in business environment. The
business of with some suggestions over different aspects led business to improve its revenue
from $30M to $75M over the period of next 3 years.
CORE VALUES AND MISSION
Better World Books is a global bookstore that harnesses the power of capitalism to bring
literacy and opportunity to people around the world.
WE LOVE BOOKS
Respect the book: read often and help others to do the same.
FLABBERGAST OUR CUSTOMERS
Seek out opportunities to make a difference with value, service & selection.
INVEST WELL. WASTE NOT.
Choose wisely; consider the return on your efforts & the impact in your actions. Reuse, reuse,
reuse.then reduce & recycle.
LEAD THE MOVEMENT
Take a stand; share your enthusiasm and build momentum through human connections.
SPEAK THROUGH ACTION
Put your ideas to work; play to win but never fear failure.
BE PASSIONATE
Wear your heart on your sleeve; stand up for what you believe.
PURSUE GROWTH & LEARNING
Challenge yourself; make a point to try new things.

BE GENUINE
Keep it real; be honest with others and true to your quirktastic self.
EMBRACE CHANGE
Adapt to circumstances; help others find ways to succeed in our evolving world.
RESPECT OUR TEAM
Be humble; welcome diversity and recognize that shared success is the only kind that matters.
BUSINESS MODEL
The working on technology in order generates big revenue by increasing sales. BWB
currently collects books from 2 different resources: 1 is campus book drives & another is
through a chain of libraries nationwide. The remaining copies they donate to different NGOs.
The company made efforts to achieve social, environmental, and economic sustainability. It
directly donated books and gave financial support to literacy initiatives worldwide. Moreover,
a percentage of each sale was given separately to the individuals, libraries, or colleges as well
as literacy partners chosen by them. BWB did not advertise in the media about collecting and
selling books; awareness about its business model was mainly spread through word of mouth.
The company made efforts to achieve social, environmental, and economic sustainability. It
measured its performance in three areas - PEOPLE, PLANET, and PROFIT
Today the company sells used books on major sites like Amazon.com and ebay.com as well
as its own website. Just six years old, the company earned $31 million in revenue in 2009 and
has prevented over 33 million books from entering landfills to date. As part of its expansive
social mission, Better World Books is a certified B-Corp, a movement to expand the legal
structure of corporations to include employee, community and environmental interests when
making business decisions.
we can recommend that current business model is contributing to the vision of the company
and is in tandem with the core set of its values, there can be questions raised on social cause
of the business to be reduced to support the goal of revenue and in extreme economic crisis,
however the longer run model suggest that the CSR visibility and such initiatives are helping
BWB for their vision

STRATEGY

The strategy to make the revenue to 75 million USD should stick to core values model of the
company, as the social cause and people cause cannot be forgotten to increase the revenue
even during economic downturns. The economy reels and enterprising individuals who apply
business practices to solving societal problems are gaining support from public and private
sectors.
The growth model of BWB indicates extreme positive signs of growth in spite of economic
downturns of recessions and hence a similar business model should be applied while keeping
technological, economic and competitive advantage as flexible to adapt to market situations.
As BWB have created its brand with green operations, it can partner with big Bookshop
chains in order to increase sales. Considering the mutual benefit for both parties we can
assume that by partnering with some bookshop chains & Supermarkets & Also independent
book shops it can make presence in more than 70% market.
To gain more investment and support from organizations promoting literacy across the world
like UNESCO and other social responsible organizations like CRY and others can contribute
to companys capital in terms of subsidies and support programmes in turn of advertisement
on books and other media concerning methods to create awareness and other social causes.
Expanding overseas to new developing economies like India, China, Brazil, Mxico,
Malaysia etc. countries shall be considered keeping the EU economic crisis in mind, however
advantages from crisis should be taken in terms of more donations and cost cuts by various
school, colleges and library institutions.

INDUSTRY TRENDS

BWB Current Market Analysis We can see that technology has had a very positive effect on
reading. We tend to read what is compressed and concise and which registers in our minds in
a few minutes. Gone are the days where reading was a leisurely habit today, its more on the
go and in an instant. Also, reading has moved away from paper and towards electronics,
which is a very good thing considering that we have to save paper in order to save the trees
and save our environment. So yes, we can say that technology has changed the reading habit
considerably, and its not all bad as you would think. The only drawback is that peoples
attention spans have become shorter and were more pressed for time because we have so
many things to do at once. However, we should get over our love affair with its physical
ancestor and realize that, as with newspapers, rotary dial phones and reel-to-reel tape decks,
the world has moved on. Digital rules and e-books now make more sense than papyrus.
Tablets are a new breed of personal computers that aims to directly compete against net
books. Tablets are slate-style computers that use a touch interface as the primary method of
input. The iPad is the main tablet on the market today soon to be followed by many
competitors. This is readers of ebook survey which was conducted in USA with samples of
739.
The sample percentages clearly indicate that eBook reader and cell phones make the highest
percentage. New tablets like the iPad, BlackBerry Playbook, and Samsung Galaxy Tab are
fast and responsive. Tablets are very versatile. They can be used for web browsing,
music/video playback, e-book reading, digital picture framing, and much more. Tablets are
highly portable. Some tablets, like the Galaxy Tab, can function as a phone if needed.

Not everyone was happy. There are still lots of people who believe in the hard paper books
and inadequate access to digital gadgets and technology is compelling them to stick with
hardcopies than eBooks. The best demonstration is In United States one public library
system for every 34,000 residents, where as in Chinas ratio is one per every 489,000
potential library users a vast gap to close no matter how fast growth is occurring.
The revenues of paper book market having shrunk by a quarter since peaking in 1996 as
consumers spend more time on the Internet and mobile phones. Amazon is now selling more
ebooks than hardbacks. Its just about to bring out a Kindle that will sell for about US$130.
This is not good news for many publishers and distributors. Hence most of the countries in
Asia and Middle East are not opened to the ebook business. For example if we look into
Japans market of e-book content totaled 53 billion yen ($569 million) in 2009. But they are
not yet ready for E-book business.

Books business market is facing a decline in growth over the past two years. This is attributed
to the overall weak economy and technology. Book store industry sales rose only 3.6% for
last year whereas overall U.S. retail sales grew by 4.3%. The bookstore industry as a whole is
going through a large consolidation. Previously, the market was dominated by local, small
stores and regional chains. With the advent of the "superstore" as created by Barnes & Noble,
the largest players in the market have been able to gather significant market share and drive
many independent booksellers out of the market.

If we look in to the reading habits most of the adult read books, nearly nine in ten adults
reads books, with women notably more likely than men to do so. Paperback books are the
most popular type of book read, reflecting their greater affordability. E- books, have a more
limited appeal, with 18% claiming to read them, evenly split between fiction and non-fiction.
Both e-books and audio books have a young reader profile, in contrast to the typical book
reader, who tends to be older.

Any book readers Any non-readers Issue If we look into the segment of analysis academic
and nonfiction books holds more than 50% share and the children books segment is never
encouraged with ebook readings.

RECOMMENDATIONS TO A STRATEGY T

The core strategy to take the revenue to 75 million USD should still stick to core values and
existing model of the company as the social cause and people cause cannot be forgotten to
increase the revenue even during economic downturns As the economy reels, enterprising
individuals who apply business practices to solving societal problems are gaining support
from public and private sectors. The existing growth model of BWB indicates extreme
positive signs of growth in spite of economic downturns of recessions and hence a similar
business model should be applied while keeping technological, economic and competitive
advantage as flexible to adapt to market situations.
New Advancements in developing the renting book model of website and e books/ readers
shall be considered with due weight age to additional costs and risk considerations.
Expanding overseas to new developing economies like BRIC countries shall be considered
keeping the EU economic crisis in mind, however advantages from crisis should be taken in
terms of more donations and cost cuts by various school , colleges and library institutions.
Developing own publishing house in a low labor environment with a Greenfield investment
today shall be considered for better revenues in near future.
To gain more investment and support from organizations promoting literacy across the world
like UNESCO and other social responsible organizations like CRY and others can contribute
to companys capital in terms of subsidies and support programmers in turn of advertisement
on books and other media concerning methods to create awareness and other social causes
CONCLUSION
Conclusion Better World Books is operating right now at efficiency of 20% on their sales
with respect to the books they are collecting; this situation may demand huge cash flows to
sustain. The increase in efficiency of the sales can solve the problems of the cash flows. Right
now BWB is selling books with other online market places. More potential websites, where
people are tempted to buy books should be targeted. Such as travel sites, educational sites and
online gift sites. Moreover operating business in the demand areas such as Asia and Middle
East will generate more revenues. Hence the BWB has to invest more on technology and
manpower as they have well established distribution and operations system.