Apply analytical tools to make a reasonable decision. In 300 – 500 words, write a brief response to the following discussion question regarding making an investment in a new business.
Your former college roommate calls you and asks to borrow $20,000 so the he can open a pizza restaurant in his hometown. He acknowledges that there is a high degree of direct competition in this market, that the cost of entry is low, and that there are numerous substitutes for pizza, but he believes that his pizza restaurant will have some sustained competitive advantages. For example, he is going to have sawdust on his floor, a variety of imported beers, and a late-night delivery service. What are the risks in lending him the money?
Directions: Using VRIO framework, deveolop your argument on this scenario