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a. What are the strategic priorities for Carla? From my understanding, Carla's most prevalent strategic priorities would be to maintain her personal client relationships while continuing her trust among her current customers and creating more long-lasting loyal customers. Lifely Wellness holds personal meaning in her life. Carla knows firsthand how CBD changed her son's life, and because of this, she wants to help inspire other people and educate them on the benefits of CBD. Expressly, I would assume her particular strategic priorities/goals would be similar to the following: 1. Customer satisfaction/ maintaining client loyalty, 2. Companies sales growth/ optimizing her costs (mainly because she doesn't have any other salespeople helping her operate), 3. Establish a trustworthy relationship (and dependable) with new distributors, and 4. Become people's onestop-shop for all things CBD.

b. What are the key challenges associated with being a micro business? Having few employees (or a single owner like Carla) limits growth and expansion possibilities. As mentioned, Carla would probably benefit from having another salesperson or someone who can do social media/ website marketing to expand from solely word of mouth. As we see in the Wellness case, another challenge is Carla's past issues with distributor dependency. When a company is small, they are more likely to be taken advantage of by more established companies within a partnership, as it does not have the power. Money management and the bottom line could be other challenges, especially pertaining to unforeseen circumstances such as COVID-19. According to the Guidance State of Small Business report, nearly 67 percent of current small business owners reported lack of capital as a top challenge during the pandemic.!1 Because of the stay at home orders, we know that people are less likely to come into a shop if they can just order it online. In general, micro-businesses have less freedom to try new things or risks because they do not have the flexibility or luxury to spend money. What I mean by this is Carla could pay a salesperson to try new ways of selling or building customer relationships (setting up a 1 https://www.guidantfinancial.com/blog/top-business-problems/

stand at a farmers market, standing outside the store to give samples, etc.). Still, if these tactics do not end up being more successful than Carla selling out of her store alone, the loss of money could be devastating. In relation to owning a CBD business, I can think of multiple challenges. The main one is being concerned with not only the reputation of CBD but the "newness" of it in society. What I mean by this is that most people, in particular, the elderly ones, I can assume automatically associate CBD with THC or weed. This is problematic because weed is arguably not accepted as a "normal" thing for people to broadcast them doing (at least from my experience). So, I can imagine that owning a CBD store often comes off as being similar to a dispensary, which is not the case. Another disadvantage, or advantage, depending on how you look at it, is understanding that the CBD and even the weed industry are relatively new as they pertain to legal sales. This could be a disadvantage as I would argue the general public does not entirely accept CBD. In particular, I could guess that La Jolla would be a challenging market for CBD. I think this because La Jolla is one of the wealthiest neighborhoods in San Diego, having a population of successful people or the elderly, not precisely a CBD market in today's age. Being in San Diego, several people value health and wellness and understand CBD's many benefits. However, I would argue that La Jolla would be a challenging place to have this store instead of College Area or Pacific Beach, where there are generally more young, liberal individuals. (*Of course, many of these are generalizations, it is just what I have picked up on living in this area for the last three years.)

c. Using the 5 dimensions of competitive priorities (speed, quality, dependability, flexibility, and cost), highlight the pros and cons associated with each supplier, and note what you find interesting, surprising or different about them. [You may want to refer to the definitions of the 5 competitive priorities available on BB]. Beta Hemp Co. seems like a perfectly suitable option for Lifely Wellness. Although they are new and headquartered in Oregon, Beta Hemp has excellent quality products and a retail store in La Jolla. These characteristics are essential to Lifely Wellness because they ensure dependability and maintain Carla's mission of delivering the best of the best. Beta Hemp Co. can white label Jordan's oil, which is an essential product of her business. Also, Carla mentioned the possibility of coming out with a new and

extra potent tincture called "Jordan's Ultra Oil," which she would do that Beta Hemp Co. offers white labeling. I think it is impressive and essential for a CBD related distributor to be able to show how they meticulously control every step of their supply chain to ensure top-tier and quality products. I think it is interesting that Beta Hemp was able to describe their exact methodologies and maintain the integrity of their cannabinoids. Because they're core competitive business model is to sell through WholeSale, Lifely Wellness could potentially be taken care of to a greater extent. Lifely Wellness could be one of a few stores that are a small retail store, which would be necessary because she can form a strong relationship with the salesperson from Beta Hemp. One of the biggest pros about Beta Hemp is offering her volume discounts and giving her 30% in cost savings, one of the goals for Carla when searching for a new partner. In conclusion, Beta help seems like a very suitable option because of their promised quality, dependability, and cost (discount). In comparison, Gamma CBD Co. is based in San Diego, which uses a grower in Kentucky. From my understanding, Gamma CBD. Co has a very similar treatment, and quality as Beta Hemp Co. Gamma CBD and Beta Hemp's significant difference is that Gamma CBD will handle most of the existing SKUs in volume and shorter lead times, ensuring fewer stockouts and the ability to meet demand. This is major for Lifely Wellness because it provides she will deliver her products to her customers when they need them. In conclusion, Gamma CBD seems like a suitable option because of its promised quality, dependability, and flexibility.

d. Should Lifely Wellness source an alternative supplier for its products? What strategy should it use? What are the pros and cons? It will be most beneficial for Lifely Wellness to source both Gamma CBD and Hemp Co. as new suppliers for its products. By sourcing two alternative supplies it will ensure the highest level of dependability. If one supplier is late or has some delivery/ restock issue, the other one will support Lifely Wellness. Lifely Wellness should start making a relationship with both salespeople and start with smaller initial orders. This way, Carla can decide if one supplier is a better fit than another and vice versa. She can

begin to test out if there's any problems while on or both and make given adjustments. The cons of starting by searching for two new suppliers is that the cost could initially be higher than she is willing to pay, but I believe she will be able to make the best decisions in the long run by trying both out first. Also, Carla must be more attentive and aware of how things are running. She should either create contracts or sign one that the suppliers agree on, so there is something in writing to avoid a situation like Chris. Besides, she should not let things "slide:" as easily. If one of the suppliers is not following through or is continuously not sticking to their word on a given delivery, Carla should reconsider that given supplier as an option. e. Should Lifely Wellness move into online sales? What are the potential challenges? Eventually, Lifely Wellness should move into online sales and should, without a doubt, begin to engage in Social Media and other digital tools. Selling products on Instagram is a valuable feature for brands who aren't ready to fully convert to strict online selling and marketing through a website, but a great way to get the word out. It is estimated that over 1 billion people use Instagram and that it is one of the best ways to sell a product. 2 Because Instagram tracks users' searches, Lifely Wellness would be able to get a substantial amount of reach. Lifely Wellness could also partner up with influencers who could share their product on their page. I believe influencers are one of the most cost-effective ways to "hire" salespeople. I know this because I have done work with given companies to promote on my page, and I am happy to do it in exchange for a free product or high discount. While I believe in the long run, Lively Wellness will far fall behind if they do not keep up with digital sales, they will avoid several challenges if they continue to continue to operate how they are right now. Time, money, and energy could all be significant challenges of managing digitally. Carla would need to spend ample time training herself with social media or hire someone to do it, which could be an upfront issue. Dealing with online orders and shipping to other parts of California, other states, or possibly out of the country could also be a potential challenge because sales are seamless and in person. Another

2 https://www.statista.com/statistics/325587/instagram-global-age-group/#:~:text=With%20over %201%20billion%20monthly,95%20million%20Instagram%20users%20each.

potential problem could be that Carla might lose touch with her brand or mission statement. As explained in the Wellness case, it is of the utmost importance that Carla is involved in every aspect of the sale, and with an online platform, she would have to give up complete control....