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Homework1BiplabDeka

TheStoryofDavidTranandSrirachaHotSauce

1.DavidTranwasarefugeefromVietnamwhomovedtotheUSinthe1960sandsettledinLosAngeles.Hecouldnotfindanyhotchillisaucelike he was used to back home and so decided to make his own. Hemadeitathomeandstarted tobottleitanddrive ittocustomersinavan himself. He called his sauce Sriracha after a village in Thailand.Todayhissauceinaclearbottleanddistinctivegreencapcanbeseenall over theUnited States and his companyHuy Fong Foods has $60millioninsalesandisstillprivatelyowned.

2.Transaysheneverstartedthebusinesstomakealotofmoney.Hejustwanted tomake a reallygoodhotsauce.Althougha lot ofpeopleadvised him to sweeten the sauce for the American consumers, hedecidednottochangeit.Hotsaucemustbehot.Ifyoudontlikeithot,use less, he said. We dont make mayonnaise here. This set hisproductapartandmadeitdistinctandhelpedcreateabrandforit.Theotherstrategythatheusedwastopriceitright.InhiswordshewantedtoMakearichmanssauceatapoormansprice.Hisdedicationtoright pricingcan beseenfromthe factthat thewholesalepriceofhis

saucehasbeenconstantforthelasttwodecades.3. Trans company has never spent a dollar on advertising. Hismarketingstrategywastomakeasaucethatwasuniqueandofferitatalow price. He never tried to increase capacity by taking outsidefinancingofferstorapidlygrowhisbusiness.Hehasconsistentlygrownhisrevenuebyaround20%everyyear.Inhiswords,Ifourproductisstill welcomed by the customer, then we will keep growing. ThecompanyisalsofocusedontheAsianconsumers,usesAsianchannels

fordistributionandsells80percentofitsproductstoAsiancompanies.4.OnechallengethatTranfacedwasthathecouldnotTrademarkthenameSrirachaasitisnamedafteracity.Thathasledtoalotofcopycatproducts that are trying to eat away hismarket share. For example,anothercompanymakesitsownvarietyofSrirachaChilliSaucethatis

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soldinasimilarlyshapedbottlewithayellowcapandthepictureoftwodragonsinsteadofarooster.5.The venture succeededmainlybecause it created a quality product

and Tran never compromised on what he set out to create. Hisdedicationtoqualitycanbeseenfromthefacthiscompanymaintainsaclose relationship with its suppliers and closely monitors the entireprocess of growing chillis from seed to harvest. Also, all chillis areprocessed within one day of harvesting in order to preserve theirspiciness. This uncompromised quality made Sriracha sauce popularanddirectlyledtothesuccessofhisventure.References:

1.ArticleinLATimes

2. ArticleinNYTimes