20 004

Examensarbete 15 hpJuni 2020

A Case Study of Five Young Entrepreneurs’

Perspective Regarding Sustainability Implementation

in the Food & Beverage Business

Sherly Basuki

Teknisk- naturvetenskaplig fakultet UTH-enheten Besöksadress: Ångströmlaboratoriet Lägerhyddsvägen 1 Hus 4, Plan 0 Postadress: Box 536 751 21 Uppsala Telefon: 018 – 471 30 03 Telefax: 018 – 471 30 00 Hemsida: http://www.teknat.uu.se/student

Abstract

A Case Study of Five Young Entrepreneurs’Perspectives Regarding Sustainability Implementationin the Food & Beverage BusinessSherly Basuki

Nowadays, businesses are considering implementing sustainability and using it as a strategy. Many corporate are focusing on the sustainability of their business, hence how do small businesses or entrepreneurs approaching sustainability? Is sustainability essential for them as well? This study focuses on young entrepreneurs' perspectives towards sustainability implementation and their motivation on opening a business in the F&B industry. The young entrepreneurs' backgrounds, beliefs, and characteristics will influence their perspectives on sustainability implementation. The aim of this study is to know young entrepreneurs’ perspectives on implementing sustainability in the F&B business. This study uses a qualitative research method and focuses on five young entrepreneurs from Indonesia and Malaysia. The theoretical framework is targeting the F&B industry, entrepreneurs' actions in the business, sustainability as strategy, last but not least sustainability, and business. The data collection uses structured interviews and qualitative interviews. The result of the study is shown as the combination of theoretical frameworks and interviews; thus, it was divided into young entrepreneurs' actions in the business and perspectives of sustainability implementation.

20 004Examinator: Ulrika Persson-FischierÄmnesgranskare: Göran LindströmHandledare: n/a

Table of Contents

1. Introduction 1 1.1. Statement of Purpose 2 1.2. Research Questions 3 1.3. Background of Study 3

2. Theoretical Framework 4 2.1. Sustainability and Business 4 2.2. Implementing Sustainability as Strategy in the Business 7 2.3. Entrepreneur in the Business 10 2.4. Food and Beverage Industry 13

3. Method 14 3.1. Research Design 14 3.2. Research Approach 15 3.3. Data Collection with Interview 16

4. Result and Analysis 17 4.1. Entrepreneur in the F&B Business 18 4.2. The Perspective of Sustainability Implementation as a Problem 22 4.3. The Perspective of Sustainability Implementation as an Opportunity 24 4.4. Sustainability Implementation and Profit 26 4.5. Obstacles in Implementing Sustainability 28

5. Discussion and Conclusion 29 5.1. Discussion 29 5.2. Conclusion 32

6. References 34 7. Appendix 37

7. 1. Interview Questions 37 7. 2. The Participant Story: Coffee Shop, Melisa Stevia Legi 37 7. 3. The Participant Story: Cafe, Sylvester Boo Jun Liang 39 7. 4. The Participant Story: Online Snack, Suryany Puspita 40 7. 5. The Participant Story: Health Catering, Amira Sanad 41 7. 6. The Participant Story: Private Dinner, Hans Cristian 42

1. Introduction

As sustainability becomes popular, it arouses a curiosity about the effect of its

implementation and positioning in the business. It will impact the internal and external sides, or

even both sides at a time. Through these impacts, it is interesting to find out profoundly about the

perspectives of business owners. As a result, this perspective leads to some questions; How do

they think about sustainability in the business? How do they feel about implementing

sustainability? Will they believe implementation brings more profit?

The tourism industry has been a money maker providing significant impacts on the global

economy. Each year, the number of tourist arrival is increasing widely. Based on the World

Travel and Tourism Council (WTTC), there is a 3.5% growth for tourism industry in 2019,

bringing the contribution of US$8.9 trillion to world’s GDP (WTTC, 2019). In tourism industry,

hospitality plays a big part, valued for $7.17Tr in 2016 (Sehnaoui, 2016). Since hospitality

industry is abroad, this study focuses on the food and beverages (F&B) industry.

The food and beverage industry is essential in the hospitality industry, which combines

goods and services. In this industry, their goods are mostly food-related which is highly

consumed everyday. In 2018, the food and beverage industry generated sales for $11.3 billion

and approximately 43,200 jobs in the sector (go2HR, 2018). This sector of business has a

significant impact on tourism. For the F&B industry, running a sustainable business might be a

challenge. Thus, this industry has its part in delivering a sustainable concept to the people. The

relationship between F&B industry and sustainability is satisfying to look into since F&B

industry's consumption, uses, and wastes have some negative impacts on our environment.

As a focus group in this study, an interview is performed to five young entrepreneurs

owning their first businesses in the F&B industry. These five potential young entrepreneurs are

between 25 - 35 years old, which are still considered as young adults. The characteristic of young

adults tends to be bold, eager to learn, and brave to try new things. At such an early age, some of

them want to achieve material success, which can be one of their motivations for becoming an

entrepreneur. Being ambitious in achieving material success, they might not think or even

consider sustainability in the F&B business.

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On the other hand, some young entrepreneurs value sustainability in their business and

eager to have it as business core value. Moreover, these people have an awareness of

sustainability as a long term goal and wish to improve their business. Hence, it is fascinating to

focus the study on young entrepreneurs and their perspectives towards sustainability and its

implementation in their business. Furthermore, any small actions performed by the entrepreneur

to implement sustainability can bring positive impact to the overall F&B business.

The F&B businesses are operating in Indonesia and Malaysia, Southeast Asia. This

subregion of Asia is the place where the F&B industry grows and constantly innovates to keep

up with various and changing trends. Moreover, the culture of using plastic containers, which is

not sustainable, is high and is inseparable from the food consumption in both locations. It is a

common courtesy to have plastic containers, cups, and bags for any takeaway foods and

beverages. Therefore, to look deeply at how young entrepreneurs handle this situation and to

connect with their perspectives in sustainability implementation will generate an impressive

result.

1.1. Statement of Purpose

This research focuses on implementing sustainability in the F&B business. The primary

goal of this research is to know the perspectives of young entrepreneurs. Besides, the interest of

this study is to find out their understanding of sustainability and their motivation, based on the

young entrepreneur’s perspective, in deciding to implement sustainability into the business.

Meanwhile, this action could bring them any risk, but they still bravely choose sustainability

implementation in running the business.

Not to mention, it is the first business that young entrepreneurs run in the F&B industry.

Thus, their action towards the F&B business can be concerned on material success or

sustainability. Since the F&B is their first business, it is important to understand the business

plan in reaching their goals, including the decision of whether or not to use sustainability-related

actions at the beginning of their business. Also, another aim of this research is the understanding

or knowledge of starting and developing the F&B business.

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1.2. Research Questions

To conduct this research and remain on course, the research questions are formulated as

follows:

● How did the young entrepreneurs in F&B industry start and develop their businesses?

● What are young entrepreneurs' perspectives and understanding regarding sustainability

implementation as a strategy in F&B business?

● How do young entrepreneurs' perspectives in implementing sustainability have a

correlation to financial profit?

1.3. Background of Study

Hospitality plays a big part in the tourism industry, and most of the current tourists

depend on Food and Beverages (F&B) during their vacation. The F&B industry plays a big part

in delivering a sustainable concept to the people, and this industry has been using many

resources that may harm the environment. When the F&B industry, as a business, can implement

sustainability to its operation, it is interesting to look into a further research.

This research will provide a better understanding of the perspectives of young

entrepreneurs towards sustainability as it has become an important element nowadays. Some

areas will be focusing on the F&B business, young entrepreneurs’ point of view towards

sustainability, and the implementation of sustainability as a strategy. Moreover, this study will

analyze the effect of sustainability aspects towards the young entrepreneurs’ actions in the F&B

business.

Sustainability has been defined as a necessity from the present generation without

compromising the ability of future generations to meet their own needs (Epstein and Buhovac,

2014). It is interesting to dig up if we put our position in F&B businesses’ perspective, while this

business is the opposite of sustainability and always be expressed as a negative vibe (Blowfield,

2013). To combine both negative and positive sides, something needs to be changed or

displaced. Furthermore, negativity can evolve into something positive because implementing

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sustainability will gradually bring good results not only for business but also for customers and

the environment.

Implementing sustainability in the F&B business is used as a strategy to avoid adverse

effects on people and our ecosystem (Borglund et al., 2017). On the other hand, it also increases

natural resources for the future. According to Epstein and Buhovac (2013), the demand for

implementing sustainability in the F&B business is urgent due to; 1) Regulation from the

government, 2) Positive reputation and improve the community, 3) The power of cost and

revenue, 4) Social and moral responsibility.

Implementing sustainability as a strategy can help to achieve a sustainable business, and

one important key is to make sustainability as primary value (Borglund et al., 2017 & Epstein

and Buhovac, 2014). While the F&B business has sustainability as the core value, young

entrepreneurs can integrate this into decision making and day-to-day operations. Thus,

eventually, it will bring success to overall business.

2. Theoretical Framework

Since this research focuses on sustainable implementation in F&B industry and young

entrepreneurs, all theories and concepts related to the research are prominent to be discussed.

Firstly, the explanation of sustainability and business theories can bring strong points of each

aspect and the purposes of cooperating both sustainability and business. Next, the

implementation of sustainability in the F&B business as the strategy is used as the premise. This

section will focus on the strategic way of implementing sustainability in the F&B business. It is

followed by the description of entrepreneurs' actions toward the F&B business, including their

actions before opening any F&B business. Finally, a brief theory about the F&B industry

connected with sustainability.

2.1. Sustainability and Business

The idea of sustainability is closely related to the environmental aspect, and it started to

get famous in the late 1980s due to environmental issues and the impact of economic

development (Page, 2019). As Dresner (2008) said, sustainability becomes essential because it is

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more powerful rhetorically for being environmentally friendly. Neglecting the responsibility to

the environment leads to the perception that people disregard the future. In 1987, sustainability

and sustainability development became essential and well known due to the report of our

common future by the World Commission on Environment and Development (Dresner, 2008).

As for now, we know sustainability as the ability to meet the present's necessities without

jeopardizing future generations' ability to fit their needs (Evans, 2019). However, Blowfield

(2013) defines of sustainability as a long-term relationship between natural capital and its

contamination in corporate responsibility. At the same time, sustainable development's meaning

can lead to the aim of integrating the environmental perspectives into the world of economics

and carefully balancing it (Dresner, 2008). Sadly, the topic, practice, and theory or three pillars

towards business are highly debated (Schaltegger and Lüdeke-Freund, 2013). Hahnel (2012)

introduced the precautionary principle, which empowers decision-makers to utilize precautionary

measures when scientific evidence about an environmental or human health hazard is

unpredictable, and the stakes are high. With this theory, Hanhnel (2012) said that when the

fundamental is still uncertain and full of risk, the best way is to be cautious.

On the other hand, business is often captured as the opposite of sustainability because

there is no answer on how sustainability can bring profit, how managing social activities and

engaging the environment can contribute to the F&B business in economic success (Schaltegger

and Lüdeke-Freund, 2013). There are some issues on whether or not economy is environmentally

sustainable, or it destroys the environment.

"If natural resources are used to increase economy quickly and leave nothing for the future, it is inefficient. If the future of natural resources were used to fulfill present economy, it would not achieve intergenerational equity. Moreover, if we cut down any biodiversity and replace it with only one species, we have destroyed the variety," by Hahnel (2012).

According to Blowfield (2013), it is true that business is the criminal in sustainability

because if a commercial enterprise rises their wealth. The business is highly in demand either as

goods or services to increase economy. As big companies gain their power, they achieve their

profit by exploiting nature and producing more waste. It implies that they take the environment

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for granted. Furthermore, according to Blowfield (2013), mostly big corporations with large

production and consumption focus on successful business which cause harm to our environment.

Small businesses' main goal is to stay alive and be profitable. Then, will small businesses

use sustainability as a business strategy? According to Nadim and Lussier (2010), there is no

proof that small businesses need sustainability or they can harm natural resources. However,

small businesses can develop sustainability as a business foundation when they integrate with

local communities (Nadim and Lussier, 2010). Small businesses and local communities need

each other to achieve competitive advantages and long term success in sustainable businesses.

Moreover, how small action towards sustainability in small business, it still produces positive

impacts on a better world (Nadim, and Lussier, 2010)

Sustainability actions towards business bring such a dilemma yet important. Hence, it is

necessary for the F&B businesses to take responsibility in environmental pollution, biodiversity,

and resources for future generations (Borglund et al., 2017). Blowfield (2013) introduced the five

capitals model (Figure 1) of sustainability, which should be applied in a sustainable business.

The model is used to understand sustainability development in a business. Each capital, in this

model, is necessary elements in a business to deliver the products or services, which will lead to

success and growth in profit.

Figure 1: The Five Capitals Model by Blowfield (2013).

According to Binns (2018), in the five capitals model, there is Natural Capital, which is

natural resources needed by the business. The second is Human Capital, which is people with

skills, health, and knowledge. Social Capital, which is linked with human capital, such as

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relationships, communication, and networking, which lead to developing the business to work

more efficiently. Manufactured Capital is a flexible, innovative capital that can be used to

produce the product, for example, buildings, transportation, and machines. Lastly is Financial

Capital, which covers any assets. Using this clear model can bring the effectiveness of

sustainable development to the business.

Investment towards sustainable business means its action has financial burdens, at least in

the short period; however, its success can be achieved as a long term goal (Müller and Pfleger,

2014). Moreover, Borglund et al. (2017) said that the business needs to expand or change the

current model or theories to work with sustainability, even though it requires specific prices.

According to Schaltegger and Lüdeke-Freund (2013), there are three perspectives on

sustainability in the business:

1. The business is contributed to sustainable development.

2. By doing good in environmental and social activities can bring some effects on

the economy.

3. If the business's importance is sustainability, it focuses on the relationship

between environmental and social management and economic success.

A sustainable company is a business which can implement sustainability not only in

operation but also through their supply chain as well (Willard, 2009). There are five areas to

focus on sustainable business: health, wealth, earth, equality, and trust (Nadim, and Lussier,

2010). A mutual connection between each area can bring profitability. Therefore, sustainable

business should be concerned about doing good for the environment and social aspects in a long

term goal.

2.2. Implementing Sustainability as Strategy in the Business

Since sustainability and business keep evolving, there are various initiatives for

businesses to be sustainable. The business should add financial performance to achieve perfect

harmony of sustainability in environmental, social, and economic. However, there are challenges

in implementing sustainability as a business foundation and combining sustainability

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implementation with financial performance into day-to-day decision-making (Epstein and

Buhovac, 2014).

If we look into it, a business will need a financial goal. On the other hand, there is a

sustainability relationship between 3 pillars (environmental, social, and economic).

Consequently, it becomes a competition between short term and long term benefits. As Müller

and Pfleger (2014), to implement sustainability in the business, the economic dimension should

be treated as unique. The economy is one of three pillars and an achievement of a successful

business. Thus, Borglund et al. (2017) have mentioned a concept called Triple Bottom Line

(TBL), which makes a business focus on their responsibility to the environment and social rather

than the quantities of products sold.

According to Epstein and Buhovac (2014), to implement sustainability in the business,

there is a cost that needs to be paid, and this cost is continuously changing. Due to uncertainty in

the sustainability movement, it is challenging to implement sustainability as an initiative

strategy. Hence, implementing sustainability in the business can bring either harmony or conflict

(Müller and Pfleger, 2014).

Implementing sustainability in a business can be a focus on business growth and a

competitive advantage on the market. Choosing sustainability as the strategy is beneficial to be

distinct from other businesses. As a consequence, the strategy should be authentic and unique in

each business to give an energetic vibe and differentiate from the competitors.

A better understanding of implementing sustainability actions to the business can

increase financial performance and sustainability value (Epstein and Buhovac, 2014). Epstein

and Buhovac (2014) also added, there are two choices to implement sustainability; one, a hard

system which is a formal strategy including structure, performance, and evaluation, and two; a

soft system which is an informal one that focuses on culture and people. The important thing in

implementing sustainability as a strategy is to make it a core value and commit to sustainability.

At first Borglund et al. (2017) mentioned that there is no transparent model on

sustainability implementation as a strategy, and it depends on the matureness of business. Thus,

Borglund et al. (2017) introduce a sustainable framework in figure 2. This framework can be

used to identify the strategies and activities of a business to be more contributed to sustainability.

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Even though implementing sustainability has some cost and risk, this framework focuses

dominantly on the positive impacts.

Figure 2: Sustainable Value Framework by Borglund et al. (2017).

As depicted in figure 2, Borglund et al. (2017) have few options for strategies that can be

implemented in the range of time short until long term. Therefore, to implement sustainability in

the business, it can bring some contributions in increasing value, new markets, attractiveness to

clients, motivation, committed staff, lower risks, and more capital (Borglund et al., 2017).

Based on Borglund et al. (2017), there is an example to show that sustainability can

increase profit. Since 2000, Vasakronan, a Swedish largest landlord, has been working on

implementing sustainability as its value. Gradually, they use renewable energy, increased

recycling, decreased waste, and have their buildings certified as environmental buildings. From

the company’s experience, the outcome has impacted positively their finances, which is a

decreased cost and increased profit.

Implementing sustainability initiatives in the business makes a result of a transformative

change that can bring positivity and attractive marketing strategy on a global scale. According to

Hult et al. (2018), becoming sustainable can bring sentiments to business because they are doing

something good. With reference to Hult’s statement, sustainability offers positive and

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meaningful activities that can influence customers’ behavior as well. Implementing sustainability

to the products should be treated as a valuable aspect (Choi and Ng, 2011).

Sustainability is transformative and essential, which is exciting to work. Implementing

sustainability maintains a positive vision for the future. It can be started by setting up a goal and

gathering sustainability information as the foundation (Robertson, 2014). By implementing

sustainability, it means ready to make some changes, and any small change can lead to a

significant impact. Hence, it makes sustainability visible in the business. According to Nadim

and Lussier (2010), it is beneficial for all businesses to have sustainability implementation

because it has a good sense and increases the possibility of long term success. Thus, there is a

correlation relationship which by implementing sustainability as a strategy can bring more profit

in a business.

2.3. Entrepreneur in the Business

The term entrepreneurship and entrepreneur have caught many people's interest due to

sudden popularity. However, what is the real meaning of these words? According to

Karatas-Ozkan et al. (2014), entrepreneurship is identified by two sections which are (1)

complex, dynamic, and developing processes, and (2) the interaction between actors, processes,

and contexts. Thus, in terms of academic background, entrepreneurship has a close relationship

with a business study (Hébert and Link, 1989). Entrepreneurship is broad and varied;

nevertheless, it has a special meaning in each context. Therefore, entrepreneurship usually has a

meaning of actions which take risk and creativity into a new business or reviving an existing

business (Hébert and Link, 1989).

Entrepreneurs are pictured as independent for their production and searching for the

opportunity (Read, Sarasvathy, Dew, and Wiltbank, 2011). This person has ethical decision

making, courage, and has a good perception of opportunities. Perception, courage, and action are

the essential elements of the entrepreneur (Hébert and Link, 1989). Furthermore, entrepreneurs

need to do many roles and faces for their business. According to Hébert and Link (1989), they

have identified at least twelve entrepreneur roles, which can be divided into two types. One is a

static entrepreneur performing their functions as financial support, manager, owner of the

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business, and employer of production. Meanwhile, a dynamic entrepreneur plays the courageous

parts in turn risk as uncertainty, such as an innovator, decision-maker, leader, organizer,

contractor, investor, and distributor of the use of resources. A static entrepreneur is a passive

entrepreneur because they repeated their actions and implemented their previous techniques,

while a dynamic entrepreneur is an influential figure (Hébert and Link, 1989).

Becoming an entrepreneur is often defined as a creator of opportunity who can bravely

risk their time, money, and reputation. Entrepreneurs always face uncertainty in the business, and

it can happen from the beginning of bringing the supply and demand to the market (Read,

Sarasvathy, Dew and Wiltbank, 2011). Thus, risk can rise in the market and it connects with

changes of estimation scenarios. According to Read, Sarasvathy, Dew, and Wiltbank (2011), to

solve risk in the business, decision making helps to calculate the specific outcome by using

existing information and mistakes. In other words, the entrepreneur's action is by using proactive

measurement to manage risk and prediction as defensive tactics in business.

The entrepreneur has two ways to overcome unpredictable, risk, and uncertainty, which

are decision making and principles of effectuation. Read, Sarasvathy, Dew, and Wiltbank (2011)

said that principles of effectuation is a logic to approach, adopt, create, transform and move

forward from uncertainty. Effectuation logic has four principles which are; start with means, set

affordable loss, leverage contingencies, and form partnerships (Read, Sarasvathy, Dew and

Wiltbank, 2011).

Entrepreneurs can develop their business idea based on the opportunity. However, to plan

this idea, they need a business plan to manage the business. With a business plan, they can

strengthen their ability to deal with problems and changes. To start a business plan, entrepreneurs

can use the Value Proposition Canvas (VPC). The VPC can help entrepreneurs to know the

challenges and opportunities. In the VPC (figure 3), there is a customer profile to understand the

customer and a value map/ value preposition to describe the entrepreneur idea (Osterwalder,

Pigneur, Bernarda and Smith, 2014).

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Figure 3: The Value Proposition Canvas.

The Customer Profile contains customer jobs, pains, and gains. According to Osterwalder

et al. (2014), customer jobs are when the customer tries to perform or complete something, look

great or gain status, feeling enjoyable or secure, and purchasing or consuming behavior.

Customer pains is defined as anything that prevents or bothers customers before, during, and

after trying to get the job done. Pains can be undesired outcomes, obstacles, and risk which could

go wrong or any negative impact. Lastly, customer gains are something beyond what customers

expect to get.

Osterwalder et al. (2014) introduced Value Proposition as the company's side, which

includes Products and Services, Pain Reliever, and Gain Creators. The Products and Services

refers to physical or tangible, intangible, digital, and even financial objects. Pain relievers

indicate the products or services which can ease customer pains. Gain Creators are a good

outcome and benefits to customer expectations.

This tool makes value prepositions visible and tangible; hence, it works for a start-up

entrepreneur in new business and existing companies (Osterwalder et al., 2014). It can be used

continuously to invent and improve the product to meet customer profiles. This is the start for

entrepreneurs to establish their idea into a business. Thus, with this model, entrepreneurs can

seek a fit which customer important jobs were eased, the pain was relieved, and receive essential

gains (Osterwalder et al., 2014).

As entrepreneurs are individuals, their actions towards sustainability will have some

impact even though it is a small action. Their actions on implementing sustainability in a

business can make sustainability visible to others, and an excellent way to interpret

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sustainability. Thus, the sustainability in a business can bring some advantages (Nadim, and

Lussier, 2010).

Entrepreneurship and sustainability have their responsibility in environmental and social

aspects. Entrepreneurs can contribute their action toward sustainable development in the

business. According to Nadim and Lussier (2010), when entrepreneurship meets sustainability,

there is a new field of study called sustainable entrepreneurship. The entrepreneur focuses on

improving social and environmental sustainability as an opportunity while gaining economy.

Therefore, sustainability can be a strategic or purpose in the business.

2.4. Food and Beverage Industry

Tourism is known as the use of leisure time for people to visit different places,

destinations, and locations during their holidays and trips (Page, 2019). Tourism has been

overgrowing each year, and according to The World Travel and Tourism Council (WTTC),

travel and tourism have been actively generated vast amounts for the economy. A concern was

raised from a sustainable point of view due to expanding business in the tourism industry.

Hospitality is the essence of tourism, which involves the consumption of food, beverages

and accommodation (Page, 2019). The F&B industry is growing because of the need to eat

during vacation or holiday and is essential in tourism because of its attraction of destination’s

image. Since there is a need in the market, there are a variety of food and beverage businesses.

The growth in this industry is due to the increasing population, and in 2022 there is an

expectation for this market to grow more and reach $5 trillion sales (Food And Beverage

Services Global Market Report, 2019). Asia-Pacific was the largest to have sales by 45% of the

market in 2018 (Wood, 2019).

According to Gossling (2012), as the population grows, the demand for foods is

increasing, which causes pressure on production. On the other hand, oil, land, and water prices

are increasing, which makes the price of production more expensive. Thus, climate change

pushes production in vulnerable situations in agriculture. In this situation, what can we do for a

better future? Food consumption is everywhere and limitless. While the production and

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consumption keep increasing, it causes more waste. In the U.K, food and drink waste is 14

million tonnes per year (Gossling, 2012).

Since sustainability is getting well known and higher demand, food production will need

to catch up with this trend and match with customer expectations. According to Gossling (2012),

there are three initiatives in implementing sustainability in the food industry. The first initiative

is having a good decision maker for sustainability in food consumption. The second is increasing

efficiency. The last initiative is creating a purchasing strategy that can influence other food

industries. Gossling (2012) also said that the critical aspects of this industry is to achieve

sustainable development in food production and consumption.

Sustainability in F&B industry is known to reduce environmental damages from

individual products, agricultural, and industrial. These include farming, agricultural sector,

distribution, storage and preparation, services, household activities, disposal and recycling, and

resources (Gossling, 2012). So, to reach sustainability, the industry should optimize food

production and consumption without endangering natural resources and ecosystems.

3. Method

This research aims to know about the young entrepreneur's perspectives of sustainability

implementation in their F&B business and correlation to profit. This chapter explains the method

of data collection and information about approaching the correspondents.

3.1. Research Design

This research is conducted with a qualitative method to know the young entrepreneur's

actions and perspectives of implementing sustainability in the business and their point of view

about sustainability as a strategy in achieving profits. According to Bryman (2012), qualitative

research is a correct approach to studying the perspectives, critical point of view, and significant

orientation. Moreover, the qualitative method helps the concept and theoretical elaboration to

emerge the data collection. Even though it is unstructured, a qualitative method is the best way to

concern people's behavior and the meaning of their actions (Bryman, 2012).

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According to Yin (2011), the simple way to know the meaning of research design is to

use it as a logical plan. This plan will connect research questions, data collection, analysis

strategy, and aim at finding which answers research questions. Thus, this plan supports the study

to be more valid and accurate. Yin (2011) also said that qualitative research does not have a fixed

model or design for each experiment, making the design for a qualitative method customized to

suit the study. Eriksson and Kovalainen (2016) agreed that the qualitative method does not

follow a strict model or design; thus, it allows for more variety and surprises in the research

process.

The research design of this study facilitates a deep understanding of the participants’

view and perspectives. Moreover, the validity of the data is meaningful and needs to be collected

properly from the participants. Validity in this study is not limited to specific answers or

findings; however, it is a description from participants (Yin, 2011).

Since this research is about young entrepreneurs’ perspectives, comparable different

aspects can be obtained. Yin (2011) introduced a rival explanation which is suitable for this

study. Furthermore, the interpretation from each point of view can be a challenge from another.

These differences can be used as a strong point of the study process and bring out the exciting

result of finding and analysis.

3.2. Research Approach

This research also takes part in multiple young entrepreneurs' businesses regarding

business growth, development, and activities. Thus, this research is suitable to have multiple case

studies as the research approach. The term "case" is directed to the focus of interest (Bryman,

2012), which is targeting young entrepreneurs in this research. According to Eriksson and

Kovalainen (2016), a case study can be complicated and varied; however, it can bring the

researcher a deep understanding of the data. The case study is valuable because it aims at

understanding the case rather than a common justification (Eriksson and Kovalainen, 2016).

Due to this research focusing on multiple young entrepreneurs, a multiple case study

research is used. Each young entrepreneur has background, perspectives, and goals. As Eriksson

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and Kovalainen (2016) said, multiple case study is excellent in generating comprehensive and

in-depth knowledge through multiple data resources.

3.3. Data Collection with Interview

This research uses multiple case studies as the research approach. Hence, an exclusive

interview is needed to understand the participants' perspectives, which are emotionalist interview

studies (Eriksson and Kovalainen, 2016). An interview activity with a phenomenological study

should arrive at the heart of the matter and listen carefully to the description from the participants

(Leedy and Ormrod, 2000, p. 153). Moreover, an interview can be about interaction and dialog

between at least two people transferring information from the interviewee to the interviewer

(Eriksson and Kovalainen, 2016).

The aim of using this interview activity is to know and understand deeply what young

entrepreneurs think, feel, and hope by relating sustainability and their business. Therefore, the

questions for the interview will be focusing on:

● The understanding of young entrepreneurs’ knowledge in sustainability and their

point of view

● The information about the young entrepreneurs' situation and decision on

implementing sustainability

● Opinion, feel, actions of young entrepreneurs in implementing sustainability in

the business and connection to the profit

The interview is conducted with a combination of a structured interview and qualitative

interview. While a structured interview is scripted, the qualitative interview is not strictly

scripted (Yin, 2011). The structured interview is used as a guideline of questions, while a

qualitative interview is performed to discover an in-depth understanding of the participants'

actions, perspectives, stories, process, and experiences. The structured question is prepared

(Appendix 7.1). Since the participants are located in different locations, the interviews were

conducted via WhatsApp Call and email-interview.

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3.4. Sampling Unit

The focus group in this research is 25 to 30 years old young entrepreneurs who start their

own first business in the F&B industry. As they are still early with their new businesses, they can

have different concerns and goals. Some of them are concerned with material success, while

others have awareness towards sustainability in their business. Their perspectives of

sustainability in the business can have an exciting result. The interview will take five young

entrepreneurs with businesses based in Indonesia and Malaysia.

The young entrepreneurs are classified into two groups, which are money concern and

sustainability concern. Among these groups, there are young entrepreneurs who started their own

business and inherited the family business. Thus, some young entrepreneurs run the F&B

business as their primary job, while others as secondary job. Five young entrepreneurs are

owners of a coffee shop, a cafe, a private dinner, an online snack shop, and an online health

catering. All of them are actively involved in their business. In this thesis, all of the young

entrepreneurs are addressed by their code names.

4. Result and Analysis

In this chapter, the results from interviews are presented through different perspectives of

sustainability implementation in the F&B business. Moreover, these perspectives are analyzed

according to the theoretical framework and delivered narratively. The interview was conducted

with five participants of young entrepreneurs. This section address all young entrepreneurs as

their code names with information in figure 4.

Name of Young Entrepreneur

Business Name Codding Name

Melisa Stevia Legi, 29 Gedogan Coffee Shop Coffee Shop

Sylvester Boo Jun Liang, 29 Spice Vaganza Cafe Cafe

Suryany Puspita, 31 Hungry Hippo Online Snack

Amira Sanad, 30 Bibis Healthy Kitchen Health Catering

Hans Cristian, 28 August Jakarta Private Dinner

Figure 4: Coding name for the qualitative data.

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This section is divided into five, which will lead to answering the research questions. The

first section is entrepreneurs in F&B business, which is focusing on understanding entrepreneurs’

background, action, and decision making in the business. The second section is the result and

analysis from the perspectives of sustainability as a problem. This section focuses on young

entrepreneurs who seek material success and do not implement sustainability in the business. The

third section is about implementing sustainability as an essential value in the business. The focus

on this section is the young entrepreneurs who are concerned about sustainability and have been

implementing sustainability in the business as an opportunity. The next section is sustainability

and profit which focus on all young entrepreneurs’ perspectives and result in the F&B business.

The last section refers to the obstacles that prevent young entrepreneurs in implementing

sustainability in F&B business.

4.1. Entrepreneur in the F&B Business

As young entrepreneurs, they need to think about what they can do to be fitted in the

customer jobs, pains, and gains as their business can produce a product or service, including pain

reliever, and gain creators (Osterwalder et al., 2014). Although all young entrepreneurs’

businesses are in the F&B industry, each young entrepreneur here solves the fit between the

customer profile and the value proposition. The figure 5 is the value proposition canvas for the

F&B business.

Value Proposition Customer Profile

Product / Services

● The F&B business (cafe, coffee shop, private dinner, snack online, and catering)

● Cooking ● Buy groceries ● Grind coffee beans

Customer Jobs

Pain Reliever

● Affordable price ● Delivery/ takeaway/ dine in ● Hassle-free ● Easy to order

● Cleaning up after cooking ● Do not have time to cook or

make coffee ● Do not have talent

Customer Pains

Gain Creator

● Delicious ● Healthy ● New experience

● No more hungry ● Can taste good food or coffee ● Feeling fulfill

Customer Gains

Figure 5: Value Proposition Canvas for the F&B Business.

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From Value Proposition Canvas, entrepreneurs can decide their unique selling point and

target market. The F&B industry is big and fierce; the entrepreneurs should have something

unique that allows them to survive in this industry and differentiate them from other businesses.

Each young entrepreneur, in this study, has their unique idea in the business as their selling point

and target market (figure 6).

Young Entrepreneur Selling Point Target Market

Cafe Classic home style foods with affordable prices

Family

Coffee shop Quality of the coffee Youngsters and Tourists

Online snack Easy to store and durable foods Medium income people

Health catering Healthy foods and environmental friendly

People who are concerned for their health and want to lose weight

Private dinner Casual fine dining with open kitchen experience

Middle to high income youngsters and adults

Figure 6: Selling point and target market of each young entrepreneur.

Entrepreneurship has a meaning of actions which take risk and creativity into a new

business or reviving an existing business (Hébert and Link, 1989). Like entrepreneurs who do

this action, they are an opportunity seeker (Read, Sarasvathy, Dew, and Wiltbank, 2011). One of

five young entrepreneurs inherited a family business, four of them opened a new business, and

one of the businesses is a secondary job. All young entrepreneurs are the owners who manage

their own business; however, their actions in business can be different. While one side is free to

create their idea, the other develops the idea which has been given.

The F&B industry keeps increasing, which has many competitors, so how these young

entrepreneurs can be still interested in opening their business in this industry. This is not an

obstacle, as for online snack (Appendix 7. 4), “Since food is essential in daily life and people

need to eat, this is a good opportunity to have a business with a large scale of the market.” On the

other hand, coffee shop (Appendix 7. 2) see the opportunity from her father's coffee farm and

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turn it into a business, “I calculate the cost to make a cup of coffee from the coffee beans that we

have, and it turns out I can get 30%-50% profit from it, so why not?”.

“At first, working in F&B industry is just for fun, but after I go back to Jakarta, I

get to know many people and gain connections from this industry. So, I feel

motivated and realized that there is much potential to advance the F&B business

in Jakarta”, Private dinner (Appendix 7. 6).

The F&B industry has a significant opportunity depending on which market the

entrepreneurs are playing. The health catering (Appendix 7. 5) saw an opportunity in Bali

market, “At that time there were not many healthy caterers in Bali; thus, with my education

background in Food Science and Nutrition, it can be my strong point to open this business.” The

private dinner has the same situation, “We are the only one in Jakarta to have a private dinner

where we cook in front of our customers, and while we cook, we can explain and socialize with

the customer to feel more homey and friendly.”

While the entrepreneur who inherited the business, they do not come out with

opportunity, instead they feel like an obligation.

“The first time I worked in my family cafe, I only thought that I wanted to

develop more on dessert menus because it was my interest. After a while, I

realized that I could not focus only on dessert, I need to know about managing the

whole cafe and financing as well! So, in order for this cafe to survive, I pushed

myself to learn the management and financing” said the cafe (Appendix 7. 3).

As Hébert and Link (1989), entrepreneurs need to do many roles, they do not stand as the

boss, but they take other roles as well. Furthermore, according to Hébert and Link (1989), there

is a static entrepreneur and a dynamic entrepreneur. All of the young entrepreneurs, in this

research, represent a static entrepreneur and a dynamic entrepreneur . The coffee shop started her

business from a small shop, and when it grew, she owned eight shops in total in 5 years. She is a

dynamic entrepreneur who became an innovator of an idea for coffee caravan, decision-maker

for any issues, leader for all the shops, organizer for any events, investor, and distributor of the

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coffee beans. In contrast, online snack can be categorized as a static entrepreneur because she is

the financial support for the business, manager, owner, and the one who makes the products. By

looking at the description about the two entrepreneurs’ mentioned above, it is concluded that a

static entrepreneur is more inclined to the small business which just started the business.

Meanwhile, a dynamic entrepreneur, in this context, refers to a person who is ready to grow the

business bigger with more responsibility.

To be an entrepreneur, they need to be ready for any risk. Read, Sarasvathy, Dew, and

Wiltbank (2011) introduced two ways to overcome risk, which are decision making and

principles of effectuation. Unfortunately, from five young entrepreneurs, none of them can be an

example for the principle of effectuation (Read, Sarasvathy, Dew and Wiltbank, 2011). Decision

making is a crucial step for the entrepreneur to build and grow their business and like Hébert and

Link (1989) said, it has been a part of the entrepreneur’s role as well.

“My restaurant is still in the making; meanwhile, the legal document is finalized, I

did not want to stop cooking for our regular customers. So, I found an opportunity

and decided to open a private dinner in the apartment that we have. Thus, this idea

is fun and gives a different experience to customers. Furthermore, by the time we

open our restaurant, we still have our regular customers” (Private dinner).

In the beginning, the entrepreneur started with means (Who I am, What I know, Who I

know) and interaction with people to get the ideas or goals (Read, Sarasvathy, Dew and

Wiltbank, 2011). From the starting point of achieving their goal, entrepreneurs should have their

process in overcoming risk, solving any issue, or generating new goals. Coffee shop knows her

means, her academic background, her skills in the hospitality industry, and her father, who owns

a coffee plantation. Thus, with interaction from her parents and some people in F&B industry,

she can reach her goal to open a coffee shop and expand the business. “Once I knew how to

manage the shop and get profit, I started to expand my business. I saved my profit and got a loan

from the bank to open my next shop. I have a target to open a new shop every year.” After five

years running the business, she had six shops in Bandung, one shop in Bali, and one shop in

Manado. From the shops that she rented, she got an idea to have a caravan coffee shop, which is

21

cheaper rent. From the caravan, she got an idea for a coffee motor that uses motorcycles to go

around selling coffee. So, every time she expands her business, she learns from her previous

experiences and makes her more innovative to get a new concept of her business.

The business process can be different from the cafe because he needs to continue with

what his family has and only needs to develop the business further. He does not have any desire

to open a new shop; however, he has a goal to develop a pastry studio as part of the cafe.

“To survive in the market, I need to adapt to customer behavior and do what I can

do. For example, for the lunch menu, I focused on the big portion. Now there is a

trend of online food delivery apps, so I also register my cafe, and people can order

through it” (Cafe).

The snack online has a different approach in the business since it is not her primary job.

“Well, as for now, I open the business to get more income. As for the future, I will see which job

can generate more money.” Since the business is still entirely new, she does not have a business

goal yet because she is unsure if she can fully manage the business and abandon her primary job.

Each young entrepreneur has their action toward the business in the F&B industry. All of

them see the opportunity to open their own business and deal it their way with a good judgment

in decision making. To be able to develop a successful business, entrepreneurs have to play

many roles, either as a static or a dynamic entrepreneur, which contributes to business

development. They have to take action and make decisions thoughtfully to fit their situation.

4.2. The Perspective of Sustainability Implementation as a Problem

Blowfield (2013) said, business has been claimed as criminal in sustainability because of

greediness to increase the economy. Hence, in small businesses, there is no proof if sustainability

can bring profit (Nadim and Lussier, 2010). Online snack has agreed with this statement,

“Currently due to limited budget for my business, I need to focus on getting more profit and use

products with less cost. Meanwhile, in Indonesia, if you want environmentally friendly products,

it is more expensive, and I cannot afford it!” Coffee shop added, “Plastic cups are much cheaper

than paper cups, the price is 1:6!” Cost is taking part in the business, and it is crucial. The online

22

snack shop and the coffee shop have been struggling with cost issues in their business. The

situation of planning to implement sustainability, which requires higher expense costs, makes

them neglect sustainability.

An entrepreneur opens a business to satisfy the customer demand in the market, so

customers are holders of business’s success. Without customers, the business will lose. Customer

behavior in consumption is an important key to have sustainability implementation in the

business. However, the business needs to be adjusted with this customer behavior.

“Unfortunately, the customers here in Bandung still depend on plastic cups and

never bring their water bottle or tumbler for their coffee. If we do not use plastic

cups to serve them, we can lose our customers because other shops can give

plastic cups. So, we cannot stop using plastic cups” (Coffee shop).

Moreover, Online snack added that people’s awareness towards sustainability is low, “I

have an idea to reuse plastic containers for the packaging; however, people think it is disgusting.

They demand to have a new container, even though I explained that containers are washed

properly.” As Dresner (2008) said, sustainability becomes essential because it has a tight

relationship with being environmentally friendly. The awareness of sustainability or even to be

environment friendly, in the area, has been ignored, and the knowledge about sustainability is

distributed inadequately to the people.

These awareness and knowledge are linked with the competitors in the area. The coffee

shop stated, “If we do not give a plastic cup to the customer, but competitors still use it, and even

have a lower price, how can we survive in the market? The customer can walk away from our

shop and go to the next door.” Many competitors are using plastic in their products, and they

offer lower prices as well. This is the reality they need to deal with, and as Nadim and Lussier

(2010) said, most small businesses prioritize to stay alive and be profitable. As a result, plastic

issues, customer awareness, and competitors provoke both coffee shop and online snack to refuse

the implementation of sustainability in the business.

“Why is it necessary to risk the business in order to be sustainable while the market is not

ready, and the environmentally friendly material is way more expensive?” asked coffee shop.

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According to Schaltegger and Lüdeke-Freund (2013), there is no answer to how sustainability

can solve the cost or profit activities. Engaging the environment and social aspect can contribute

to the business and bring success in the economy. “Implementing sustainability in the business is

important to be honest, although, for me, I will prioritize others for the first place and

sustainability in the business is like in 100th place.” coffee shop added.

Young entrepreneurs’ perspectives towards sustainability implementation in the business

can be categorized as a problem in which it creates higher expenses, makes young entrepreneurs

to work extra and leave their comfort zone. Both coffee shops and online snack prefer to reach

their material status as their goal and fulfill the market demand without worrying any

consequences. Thus, to have sustainability in the business might start from the entrepreneur’s

awareness and heart. Their decision to refuse to implement sustainability in the business was also

affected by various external factors; cost, consumer behavior, consumer awareness and

knowledge towards sustainability, and competitors.

4.3. The Perspective of Sustainability Implementation as an Opportunity

Epstein and Buhovac (2014) always said that sustainability is a necessity from the present

generation without compromising the ability of future generations to meet their own needs.

Health catering has a deep understanding of it, “Sustainability is applying a system in all aspects,

both business in the field (goods or services), public policy, law, and others that seek to

minimize damage to the ecosystem and the environment.” Private dinner has his view as well,

“Sustainability is wide. As in the F&B business, not only about plastic waste but also the

production including the supplier, materials in the restaurant like ceramics, and the important

part is our belief of doing good.”

Since health catering and private dinner have a good understanding of sustainability, it

turns out that they have implemented sustainability in the business. The private dinner has built

some connections. “When I was back in Jakarta and worked here, I met many people, not only

chefs but also other people who can help build the F&B industry like farmers, fishers, and

artisans. Furthermore, this is one of the reasons I want to develop further in the F&B business.”

24

This is the example of the social capital in which relationship, networking, and communication

are vital in the five capitals model introduced by Blowfield (2013).

Borglund et al. (2017) also mentioned that the company should focus more on their

responsibility to the environment and social rather than focusing on products sold. “80% of our

products are using local ingredients from local markets; moreover, we no longer use plastic

containers,” said health catering. As for the social aspect, private dinner uses local artists to make

the ceramics for his private dinner. He wants to support local artists rather than using

manufactured ceramics, similarly with food ingredients in his business.

“I went to Lombok and Sumbawa to find fishermen who can supply me with their

fish. However, I do not want to have fishermen who do the bombing method or

use big nets to get the fish. I prefer the old fishing way, one by one, because I do

not want to harm the ecosystem, and I can help local fishermen in terms of a job”

(Private dinner).

The actions taken by health catering and private dinner, focusing on environmental and

social aspects, bring connection with the statement made by Epstein and Buhovac (2014) about

two choices to implement sustainability; hard system and soft system. In this situation, both the

private dinner and the health catering are using a soft system which focuses on culture and

people. Thus, a hard system is inclined to a business style development that implements

sustainability into the structure, performance, and formal system of evaluation.

When entrepreneurs decide to have sustainability in the business, they are ready to

implement it as a strategy. Borglund et al. (2017) have few options for strategies that can be

implemented in the range of time short or long term, like in figure 2. Both of them are in the

strategy of ‘Avoid Negative Environmental Impact’. They are currently focusing on consumption

and waste from production. “We use glass bottles rather than plastic, and we have a buyback

system in which we collect the bottles that we sold to customers and exchange them with

discount vouchers. With this system, we can minimize our waste and increase our sales.” said

health catering.

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“The sustainability in my private dinner is focusing on the production side. For

example, we use the fish that our fishermen caught, available veggies from our

farmer, and do not use any imported ingredients. Therefore, we can minimize the

waste of our food production” (Private dinner).

Investing sustainability in the business can bring its success and can be achieved as a

long term goal (Müller and Pfleger, 2014). Thus, implementing sustainability in the business can

bring sentiments into the entrepreneur because they are doing something right (Hult et al., 2018).

“To have sustainability implemented in the business, not only do we care about

our environment and social issues, but there is a feeling inside my heart that I am

satisfied by doing something good. Maybe it is hard to see the result now, and I

am aware that its benefits can only be seen in the future, but it is worth doing”

(Private dinner).

Health catering and private dinner have an understanding and awareness of sustainability.

For this reason, their perspectives on implementing sustainability is to do something good for the

environment and local markets. They do not have the business to be wholly sustainable but still

implement sustainability on specific actions. Moreover, they are also aware that any small action

can still bring positive results. Implementing sustainability in the business has created an

opportunity for both health catering and private dinner because it boosts sales for health catering

and improves creativity in cooking for private dinner.

4.4. Sustainability Implementation and Profit

It is hard to prove if sustainability implementation has some impact on the business’

profit. However, these young entrepreneurs have their perspectives towards this connection of

sustainability and profit. Like Schaltegger and Lüdeke-Freund (2013) said, there is no answer on

how sustainability can bring the cost or profit in the business and its success.

26

The situation of online snack and coffee shop, which stated that plastic container prices

are lower than papers, makes them feel that sustainability adds more cost in expenses and not

sure how it can turn into profit.

“If I change plastic cups into paper cups, I need to increase my coffee price. How

many people will buy my coffee, which is more expensive than the usual price? If

I have a rule; customers who want takeaway coffee will get an extra charge for

plastic cups or paper cups, they will walk through my shop and go to other shops

which can give them normal prices and plastic cups” (Coffee shop).

Meanwhile, the health catering and private dinner have different perspectives. Having an

opposite statement to the coffee shop’s, the health catering believes that , “Once we use

sustainability as our strategy in the business, it helps to boost our sales and marketing.” This

statement is in line with one of three perspectives on sustainability in the business proposed by

Schaltegger and Lüdeke-Freund (2013); if there are good performances in environmental and

social activities, it will bring positive effects in the economy. However, private dinner did not

agree if implementing sustainability can bring more profit and his perspective is to be prepared

for any consequences by choosing sustainability implementation and spare no excuse to run

away from it.

“Financial effects from sustainability cannot be seen in a short time, but more

into the long term. While choosing to implement sustainability in a business, we

choose to be committed and ready for any risk, including cost issues. The best

way to deal with it, is by choosing correct decision of alternatives” (Private

dinner)

Sustainability and profit are hard to prove, but all young entrepreneurs have their

perspectives regarding the connection between them. Their perspectives on sustainability and

profit are appealing, as a result. Their background, situations, and goals influence these

perspectives. Therefore, cost issues, either negative or positive, will be faced whether they have

implemented sustainability or not in the business. Like Müller and Pfleger (2014) said,

27

implementing sustainability can bring harmony or conflict. Thus, it can bring some contributions

in increasing value, new markets, attractiveness to clients, motivation, committed staff, lower

risks, and lastly, more capital (Borglund et al., 2017).

4.5. Obstacles in Implementing Sustainability

Implementing sustainability in the F&B business can have some obstacles that challenge

young entrepreneurs. These obstacles, which are government, people awareness, and

competitors, prevent young entrepreneurs from implementing sustainability or from being more

sustainable in the business.

The government produces laws, rules, and regulations that people need to follow. As

young entrepreneurs from Indonesia, they claimed that the government does not have any

specific laws about waste management and environmental issues. This brings young

entrepreneurs to be ignorant about sustainability. “The government only said that plastic waste is

not good, but there are no strict rules or fine if we still produce plastic waste. So, why bother to

change? If there is a fine from the government, I will not use any more plastics,” said coffee

shop. Shockingly, the Bali area has strict rules about plastic waste. “Bali has a strict rule of

banning any use of plastic containers and fines towards any violation of this rule, which reduces

the use of plastics in this region. Therefore, people in Bali get used to live without plastic bags or

containers,” said health catering.

In Malaysia, the government takes control of the hygiene and operation of F&B business.

Every year they have an inspection to grade the business from A until D. Because of the

government's clear rules in Malaysia, the customers are also accustomed to no-plastic lifestyle in

the F&B businesses.

“Since the government has an inspection every year, I need to follow their

procedure from hygiene until the operation process. It includes waste

management, as well. Moreover, the region also has rules on no-plastic bags on

certain days” (Cafe).

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The next obstacle is people’s awareness of sustainability, which is connected with

competitors. The information regarding sustainability is distributed inappropriately, hardly heard,

and taught inadequately. Therefore, many people are unaware of environmental issues and still

demand plastic bags or containers. Thus, it is linked to competitors’ awareness of sustainability.

“It is hard to compete with competitors who are using plastic containers and lower prices,” said

health catering.

The government, people's awareness, and competitors are obstacles that are linked

together. If the government can distribute information and sustainability knowledge to the

people, awareness of sustainability is rising by reducing plastic consumption, and the

competitors can compete equally.

5. Discussion and Conclusion

5.1. Discussion

The research questions, in this study, focuses on young entrepreneurs starting and

developing their F&B business, young entrepreneurs’ perspectives on sustainability

implementation as a strategy, and young entrepreneurs’ perspectives on the correlation between

sustainability and profit. The theoretical frameworks include sustainability, business,

entrepreneurship, and the F&B industry. From five young entrepreneurs, as the case study,

impressive results are achieved while answering the research questions and using the theoretical

framework.

Entrepreneurs’ perception, courage, and action are important elements that bring their

roles in developing F&B business (Hébert and Link, 1989). It was shown when young

entrepreneurs decided to open and develop their business. Like online snack, she does not have

any background in F&B industry but bravely opens her business. As for the entrepreneur's role,

online snack is suitable as a static entrepreneur because she has just recently opened her

business. Meanwhile, the rest of young entrepreneurs are dynamic entrepreneurs who are

developing their F&B business. The roles of entrepreneurs depend on how the entrepreneur sees

29

their business and willingness to develop further. The more progress in the business, the more

roles that entrepreneurs take.

When young entrepreneurs develop their business, they need decision making for daily

operations and plans. Read, Sarasvathy, Dew, and Wiltbank (2011) introduced principles of

effectuation in entrepreneurship. However, all young entrepreneurs still run their businesses with

their strength and money. Thus, none of them can be an example of the principles of

effectuation. Although, all of them have good decision making for their business, like how

private dinner decided to open the business in order to keep their regular customers and how cafe

decided to register online delivery apps to adapt to customer behavior. Their decision making

depends on their goals in F&B business.

Based on the result of interviewing five young entrepreneurs, two outcomes are divided

into perspectives on implementing sustainability as a problem and as an opportunity. However,

cafe is in a neutral zone because of the government involvement in rules and regulation of F&B

industry. His business follows the government’s law, which is an excellent way to reduce plastic

waste and raise awareness of sustainability in the business. So, his perspective is influenced by

the government laws which are good for the environment. On the other hand, cafe did not pursue

more actions towards sustainability.

Coffee shop and online snack bring results of perspectives on implementing sustainability

as a problem. Both of them have a lack of knowledge towards sustainability and concern on

material success. Meanwhile, health catering and private dinner perceive sustainability as an

opportunity. Their excellent knowledge of sustainability encourages them to implement

sustainability as their business strategy, which impacts the business positively. All young

entrepreneurs’ perspectives towards implementing sustainability in F&B businesses depend on

their business goals and personalities. Choosing sustainability can be either worth for the

business because of good value or an inconvenience because of higher efforts and higher expense

required.

In the theoretical framework of this research, the information of sustainability models

implemented in corporate social responsibility is presented in Figure 1 and 2. Hence, this theory

of the Five Capitals Model and Sustainable Value Framework are used mostly in big companies.

30

In this study, those models can fit in small businesses like private dinner and health catering.

Moreover, as long as small businesses value sustainability in the business, they can follow any

sustainable models from big corporate.

Young entrepreneurs’ perspectives on the correlation between sustainability and profit

have interesting results. Coffee shop and online snack believe that implementing sustainability

will incur them higher expenses and less profit. On the other hand, health catering provides proof

that sustainability helps increase the sales and marketing. As for private dinner, he feels that

implementing sustainability is a commitment, which has a price to pay. Based on each situation,

they have different perspectives on the correlation between sustainability and profit by

considering their background on how their businesses developed.

From all interviews, some obstacles appear in implementing sustainability in the F&B

business. In the theoretical framework, there are no specific or clear challenges that young

entrepreneurs may encounter in the F&B business. However, in reality, some obstacles are

limiting their sustainability in the business, which are the government, people's awareness, and

competitors.

The government plays a big part in limiting sustainability implementation in the F&B

business. Malaysia’s government involves themself in grading the F&B businesses’ hygiene and

operations, like cafe’s. Meanwhile, Indonesia’s government does not have strict rules and

regulations in all regions, causing coffee shop and online snack to neglect the implementation of

sustainability. Without clear rules and regulations, young entrepreneurs do not have the urge to

implement sustainability in their business. The government is also responsible for distributing

sustainability awareness to the people. Therefore, consumers and competitors can understand

how important sustainability is in business.

Since this is qualitative research on young entrepreneurs’ perspectives, the data collection

is derived from their background, understanding of sustainability, personalities, beliefs, and

action in the business. Thus, each situation of each young entrepreneur is different from each

other and it affects their perspectives as well.

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5.2. Conclusion

A broad F&B industry keeps increasing because of its easiness in opening a business in

this industry. Despite this, the business has challenges ahead. As entrepreneurs, they need to see

the opportunity and create their idea from it, while realizing the presence of risks as well. The

purpose of this study is to investigate young entrepreneurs' perspectives regarding sustainability

implementation in the F&B business. The research conducted focuses on young entrepreneurs

who run their first business in the F&B industry, by combining their understanding of

sustainability with their action and perspectives in the business.

Young entrepreneurs in this research are eager and can turn the opportunity into F&B

business. All of them have interest in the F&B business. To run a business in this industry does

not require a certain academic background. Although the F&B industry has many fierce

competitors, entrepreneurs can come out with unique selling points which can attract customers.

Either opening new business or developing existing business, all of them need to be innovative to

be in F&B business.

Each entrepreneur in this study has their action in the business, depending on their

background and goals. Their education background, social surrounding, personalities, beliefs,

and external factors affect their perspective and decision making to implement sustainability in

the F&B business. Therefore, some young entrepreneurs perceive implementing sustainability as

a problem and some of them as an opportunity.

For coffee shop and online snack, sustainability is seen as a problem because knowing

sustainability depends on the individual's awareness and knowledge about it. Both of them tend

to be entrepreneurs aiming for material success and focusing on money. When they face the

more expensive cost of environment friendly material, they refuse increasing their expenses and

keep using plastics. As their business depends on customers, they care too much about

customers. So, when the customers demand plastic containers, they supply it. Furthermore, the

unavailability of laws on waste issues prompt them to disregard sustainability. As a result, they

are comfortable with the way it is now without implementing sustainability in the business and

this is why they feel sustainable is a problem to grow their businesses.

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The opposite result from health catering and private dinner; they know about

sustainability and are aware of it. Their concern in sustainability brings it as a strategy in their

business. Both of them prioritize sustainability in their products and let the customers understand

it. Moreover, it turns out to be their unique selling point. For these reasons, private dinner and

health catering can raise awareness of sustainability to their customers. Thus, sustainability for

them is an opportunity to increase sales and be more creative.

As a result, young entrepreneurs' perspectives toward sustainability implementation in the

F&B business are connected with each knowledge and awareness. The connection is influenced

by several requirements, such as commitment, readiness for any risk, and persistence in

achieving the result. Furthermore, any small actions in the business can still bring positivity in

sustainability.

33

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7. Appendix

7. 1. Interview Questions

Structured Interview Questions:

● Do you mind explaining your business? (Include: how long is the business,

interest in the F&B business)

● How familiar of you about sustainability?

● Have you considered taking some action towards sustainability in the business?

● How it impacts the business?

● What is your point of view about implementing or applying sustainability in the

business?

● How Implementing sustainability in the business brings negativity or positivity in

the profit and why?

● Do you think your business is sustainable? At what level?

● What factors prevent you from becoming sustainable in the business?

7. 2. The Participant Story: Coffee Shop, Melisa Stevia Legi

Melisa is a young entrepreneur of Gedogan Coffee Shop, which is located mostly in

Bandung, Indonesia. It started when her father owned coffee farms, and previously she only

helped her father with the farm. One day, Melisa thought of opening a coffee shop because her

father has the primary material, which is coffee beans. She tried to calculate if it worthed to open

a shop, and by 2015 she opened her first coffee shop. She saw the opportunity while her father

owned a farm, and her idea of opening a coffee shop was interested in making money. She

graduated with a hospitality degree and has work experience in the hotel industry, which are the

reasons she took an interest in the F&B business. Since her father owns the coffee farm, this can

be the selling point of the business in which the quality of coffee beans is maintained from the

start until to the customers’ cups.

Gedogan Coffee Shop has its target market, which is youngsters and tourists. She has

been an entrepreneur for five years, and she expanded her business quite quickly. In these five

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years, she owned eight shops in three different cities. Her strategy for the business is to expand

as quickly as she can without thinking further about any risk ahead. As the business grows, she

still handles most of the management by herself, including menu development, new projects.

Furthermore, now the shops have more varieties of food and beverages menus. The foods are

focusing on Indonesian cuisine and snacks, and the beverages have lots of variety with the coffee

base.

While sustainability becomes popular, Melisa does not overthink about turning the

business in a fully sustainable way. Her shops in most locations are still using plastic due to

lower prices and customer demand. However, it is entirely different from her shop in Bali. Due

to the region’s strict rules and the region cares about plastic waste, her shop is no longer using

plastic cups and only uses paper cups and encourages the customer to bring their tumbler.

Here, she shared customer behavior in the Bandung area. People still do not care about

plastic waste, and the government does not have laws and regulations regarding waste and other

environmental issues. Since there is no awareness of sustainability from the customer, she does

not dare to take sustainable action towards the customer because it can make the business lose

money. Thus, without any strict laws, she still can use plastic how much she wants.

Melisa’s perspective of sustainability implementation in the business is just a problem

and not prioritized. Melisa feels that she needs to adjust the business with what customers need

and want. Therefore, there is no sustainable action in her shop since it does not bring benefits to

the business. She feels there are many obstacles for her business to be more sustainable, like; the

government without strict law, situation of specific locations, customer awareness towards

sustainability, unhealthy competitors, and most entrepreneurs do not realize the importance of

sustainability.

In the future, Melisa hopes to reduce plastic waste by introducing her tumbler (like

Starbucks idea), using paper boxes for any takeaway products, and a discount rate for customers

who use their tumbler. These ideas might be developed for the next two years. Melisa said, she

might want to implement sustainability, however, if the government starts to have some rules on

it.

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7. 3. The Participant Story: Cafe, Sylvester Boo Jun Liang

Jun Liang is the current owner of Spice Vaganza Cafe at Muar, Malaysia. The cafe was

initially owned by his parents ten years ago. In the beginning, his parents open the cafe

partnership with other people, but in the second year, the cafe becomes wholly owned by his

parents. The cafe was passed down to the children. First, it was his sister, continued to his

brother, and now to Jun Liang. Each person has a different style handling the management of the

cafe, and this was the challenge that Jun Liang was facing when the brother handed over the

cafe. He experienced some of the staff not used to Jun Liang’s management style and point of

view; as a result, some of the staff left. In 2014, the cafe was managed by his brother and Jun

Liang together, but only in the past three years until now, it was managed entirely by Jun Liang.

At first, Jun Liang focused on baking and wanted to enhance the dessert options in the cafe. Thus

he realized that he could not only focus on dessert, but he also needed to manage accounting,

purchasing, and administration.

The cafe is focusing on a set lunch menu with a big portion and a simple menu of dinner

with western food style. With the selling point of homey foods and targeting the family market,

the cafe still has its popularity. Jun Liang said that in Malaysia, customer behavior is changing

quickly and rapidly; this is quite a challenge for him. For example, now his cafe has

collaboration with food panda (online delivery apps), so people can order food from food panda

apps and deliver to their door. With this decision he made, he hopes that his food can reach

people anywhere they are.

As for sustainability in the business, he never thinks about it, but unconsciously has some

sustainability actions. Since the government has a strict law about plastic consumption, he

changed plastic containers into paper boxes, and there are no more plastic straws given to

customers. Since his location is not in a big city, some ingredients are hard to get from the local

market. However, the only ingredient he used from the local market is the oyster mushroom.

Thus, there is no unique process for waste management, although some food waste will be given

to feed chickens on his father’s small farm. The government in Malaysia also has a strict

procedure of health and operation check each year for any F&B business. They have a grading

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system from A until D, and this makes Jun Liang’s Cafe have some standard of waste

management.

Jun Liang is a big dreamer and wishes in the future when he has a budget; he wants to

change the cafe with a solar energy system. Moreover, he also wants to change the paper menus

into the iPad. Jun Liang hopes to achieve this goal within two to three years. Meanwhile, he will

work on no plastic use at all in the cafe.

7. 4. The Participant Story: The Online Snack, Suryany Puspita

SSuryany recently opened an online snack shop that specializes in Indonesian and

Western snacks. The shop name is Hungry Hippo which has a unique selling point on easy to

store and durable foods. She does not have any background in the F&B industry, and the reason

she opened a business in this industry is that she likes to eat, and she thinks that people need to

eat. This shop is not her primary income, she has been working in the IT industry for seven

years, and because of the Covid-19 situation to work from home, she can have proper time

management to make the products. While opening this business is for more income, she is still

unsure whether she will change this shop into her primary job in the future.

She has been planning this business for a year. She keeps practicing a good recipe for the

foods, looking for the food container, and registering into an online application. While she was

searching for the food container, she cannot avoid not using plastic because the price is lower

than paper-like 1:6, and she needs to adjust it to fit her budget in this business.

Suryany does not understand the term sustainability in the F&B business. However, after

explaining what sustainability is, she has some planning for the future when the business can run

well and stable, she wants the business to be more environmentally friendly. Sadly due to the

tight budget of the business, she does not implement sustainability in the business. She thought

that to be a sustainable business, the cost of the expenses will increase; meanwhile, her business

is just starting, and she wants to earn more money first.

Suryany still is not sure if she will let go of her primary job in the IT industry. As her

goal now is only to earn money, she will keep both jobs as an entrepreneur in the F&B business

and office worker in the IT department.

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7. 5. The Participant Story: Health Catering, Amira Sanad

To be healthy and lose weight is the unique selling point of Bibis Healthy Kitchen, which

has been run by Amira for five years. In 2015, the Bali market had a limited selection of health

catering, and Amira saw this opportunity. She was interested in opening a business in the F&B

industry with her background as a graduate student from the Food Science & Nutrition program.

Since the business is for healthy products, she is aware of sustainability and has decided

to implement it in the business. Her sustainability perspective is applying a system in all aspects,

both business in the field of goods or services, public policy, law, and others that seek to

minimize damage to the ecosystem and the environment. With her ideal to stand by and

implement sustainability in the business, there is low usage of plastic, no marketing flyer, and

more glass bottles. Since sustainability is implemented in the business, it serves as a selling point

to differentiate her business from other competitors.

Amira also uses sustainability as a strategy in the business. She has a system called

buyback, which buys the packaging that has been sold to the customers; for example, customers

keep five bottles/ jars and will get 20% off for the next purchase. Moreover, 80% of the products

that she uses are from the local products and markets. It is because she needs to use fresh

ingredients, and using the local farmers is a good strategy. Therefore, these strategies are a

success, increasing her sales and helping her in the marketing as well.

Her action towards sustainability is brave. She has an awareness of sustainability and the

environment. Bali is her hometown and a tourist island. She is a witness to how the beach in Bali

is full of plastic waste. Therefore, she wants to make changes and is willing to implement

sustainability in her business.

In the future, she wants to take more sustainability steps to reduce CO2 emissions by

using electric transportation and making it efficiently in delivering the products. This plan will

be changed gradually within one until two years. This idea can be considered as a big plan

because, in Indonesia, electric transportation is more expensive than fossil fuel.

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7. 6. The Participant Story: Private Dinner, Hans Cristian

Hans has been working in the F&B industry for seven years and has worked in Malaysia,

U.S.A, and Jakarta. With his academic background in Culinary, his last work experience was as a

chef in Fairmont Hotel, Jakarta, for three years. His interest in the F&B industry started from just

for fun into feeling the urge to develop the F&B industry much better. When he worked in

Jakarta, he met lots of people not only from the F&B industry but also from farmers, fishers,

artisans, and artists. From this connection, he built a relationship with these people and became

one of the reasons to open his own business.

Within a year, he planned and developed his restaurant from the beginning.

Unfortunately, due to legal procedures, the restaurant is still on hold. Meanwhile, he came up

with an idea of a private dinner in the apartment that his friend owns. The private dinner provides

the customer with a unique experience of a friendly atmosphere. The customer can see the chef

cooking in front of them; thus, the chef can directly socialize with the customer. Since it is

located in an apartment, it is only available 12 people, and the sitting arrangement is one big

table with 12 seats. So, there is a chance to be seated next to strangers. However, this unique

experience did not hinder the customer, although the customer can build some connection

towards another.

Hans came up with this private dinner idea as a platform to keep his regular and loyal

customers. If he does nothing and waits until the restaurant opens, he might lose his customers.

So, to keep the relationship and widen his connection, he opened this private dinner, which

serves tasting menus with 8 - 10 refined courses and focusing on the combination of flavor and

concept of the dish.

Since Hans is aware of sustainability, he implements it as a strategy of his business. Hans

took sustainability seriously. He found local fishers, local farmers, and local artists on his own

because he wanted to support local business and not depend on importing ingredients or

manufactured ceramics. Thus he feels that it can be a challenge for him to create his unique

dishes. For example, his menu will be based on what fish that fishers have caught and what

veggies that farmers have. Through these available ingredients, he will try to create the menu.

42

Hans understands sustainability deeply and has ambition in it. He is aware that

implementing sustainability in the business cannot be seen in a short time. He said that to

implement sustainability in the business, we need to commit and be aware of any risk, including

cost issues. “Sustainability is not about profit but is about doing something good for our mother

earth, and by doing good, I feel satisfied and relieved,” said Hans.

43