Small and medium enterprises; New business venture; Developing world; Food industry; Financing small business; Business planning; Nigeria; Africa; Government policy; Emerging market; Government regulation

This is the first of a three-case series (806-052-1 to 806-054-1). It was January 2003 and Charles Ntuko, the Managing Director of Amex Brown, a marketing company was at a crossroad. He had to decide which direction his company must take following the ban on the importation of ready-to-drink fruit juices by the Federal Government of Nigeria. Imported fruit juice constituted 70% of his company's income (approx US$70 million) as of December 2002. Charles had spent ten years prior to the ban developing a strong national distribution network. His sales performance had culminated in his appointment as the sole agent for Joker fruit juice in Nigeria and the rest of West Africa. Should he use his importing experience to import other items not on the list of banned items or should he produce fruit juice locally? His company's strength was in marketing and Charles was not sure whether he should attempt to develop production capability. At the time the ban became effective, there were only two local manufacturers and they accounted for 15% of the market. The third local manufacturer, Coca Cola, was to commence production in September 2003. The gap created by the ban was also being filled by the manufacturers of fruit drinks and flavoured water. These producers were highly fragmented. Santa Val has been structured as a three-part case study. Case (A) focuses on opportunity recognition, the multifaceted problems that entrepreneurs face and their approach to decision making. Case (B) explores the complexity of small business venturing in an emerging market, where the variables are many and unpredictable. It exposes perhaps the most important attribute of entrepreneurs: focusing on their goal despite all odds. It brings to fore the importance of business planning as a tool to ensuring successful product launch. It also underscores the importance of cash flow, capital adequacy and the type of capital one uses in the venture. Case (C) reconfirms the fact that decision-making in an organisation is continuous and entrepreneurs must constantly scan the environment and re-assess their position vis-a-vis their competition if they are to navigate constantly changing markets. The teaching objectives are: (1) to introduce a framework for analysing business opportunity; (2) to highlight the importance of business planning in venturing / launching a product; (3) to emphasise the need for a systematic approach to decision making; and (4) to highlight the importance of adequate capital structure for business survival and growth