Thought Bubbles

I try not to repeat channels or recommendations too often. ModernMBA, the YouTube channel has been covered here before. But the latest video has something that was too good to pass on.

Bubble Tea is a tapioca based beverage that is all the rage right now. In another Vice-meets-Bloomberg video, ModernMBA covers three outlets with different strategies and positioning, all located in the Bay Area. What elevates the video, though, is Hannah, the founder of 7 Miles Tea Lab. She was a franchisee of a major Taiwanese brand, before she struck it out on her own.

This move was precipitated by a classic mistake of the franchisor:

“But that relationship turned frosty as she lacked the autonomy as a franchisee and the brand lacked flexibility as a franchisor. When things slowed, Hannah came up with 3 new drinks to reignite sales but it took many months of back-and-forth with HQ to get approval.

What Hannah saw as necessary adaptation and local insight, her franchisor saw as meddling. They would rather keep scaling, even if that meant fitting square pegs into round holes. Ironically, Hana's 3 drinks became the chain's best sellers, and this gave her the belief that she could create and capture more value going her own way.”

As Master Oogway says,

The franchisor should’ve hired her, promoted her to head of product development, or at least given her more outlets to run. Instead, they created a formidable competitor. On the plus side, Hannah looks happy!

Listen to her interview, starting at the 6:00 mark for a masterclass in business, economics, positioning, strategy and self-awareness. Seriously, it would take decades for someone to achieve this level of clarity and insight in any industry, if ever. And Hannah has gotten there in 5 years.

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