Final Business Plan

pic University of Technology Jamaica Entrepreneurial Skills Business Plan Business Idea deface Charge Group B. Eng. 2M (ca) Date April 11, 2007Group members Lecturer Mr. Clive GrossettDexroy Jones Dwayne McIntoch Mckay Kirkpatrick Binns Calford Ramsay Keon Hinds (3M art) administrator Summary ________________________________________ Introduction Swiff Electronics is a start-up cellular phone earphone accessory and electronic distribution federation. Its system is to add all told cell phone users who take over unbroken dead battery while engaging in an important call or entertaining entertainment woof.It leave behind capitalize on the intricate engineering design and manufactured output that is capable of recharge a cell phone. There be many untapped potential marts within this industry, as the longing for high-quality stylish goods that be convenient, affordable, and easily consultationd ar in great demand. It is the firms intention to import harvest-multiplicatio n from the leaders of electronic, Teqtronics and introduce it to a target population within Jamaicas Metropolitan or corporate argona and to make Swiff Electronic a house forbear name customer come to know and trust.To do this the companys semipermanent goals argon to succeed a 20% commercialize share in the Jamaicas build brand image and brand equity through securities industrying, achieve a sustainable 55% profit brim, and eventually produce our very own luxury product in addition to the initial, moderately- determined line. The company Swiff Electronic is a limited liability corporation in which the sourcing of the product bump offered Spot Charge is done internationally while the marketing and sales are focused in and around the corporate areas of Kingston Jamaica, for short term purposes.Owners hip is divided among five principal individuals who are putting up the initial investment. These include Dexroy Jone Managing Director, Keon Hinds enquiry of Finance and admi nistration, Calford Ramsay guide of Marketing and Human Resources, Dwayne McKay McIntoch Head of Product Development and Kirkpatrick Binns Head of Operations. The First outlet of Swiff Electronics pass on be located at 13 Duke Street, Down Town Kingston, Jamaica. The present location is approximately 700 square meters and should be large enough for the first three years of the companys growth.The portable Chargers volition be stored at the Duke Street location and will be dispatched to different location establish on demand and promise signed with our feature business partners. The product The initial product line will depict the full effect of the product that will be offered, inclusive of a range of different colour in and possibility the opportunity to personalize. The company plans to release more models, which will be integrated as we luff to harbor customs a wide selection to choose from.The pricing strategy will be to initially undercut our main competitors by selling at a minimal profit, using a market penetration strategy. Then, pricing will be ad equitableed to be directly competitive with the other(a) major competitors. The price per Spot Charge is anticipate to be unbelievably affordable. The market Entry into the telecommunication/electronics industry comes at a prosperous time. Over the past two years, the bribes of cell phone have increased vastly and the trend is expected to continue one time the cell phone manufactures continues to introduce raw features to their designs.This will only if adversely widen our market as individual continues to seek charge Where ever, when ever. One of the most important recent trends is that cell phone users are willing to spend higher(prenominal) amounts on their phones because of the enhanced image appeal and reliability. Therefore, a company that laughingstock build a substantial brand image in this industry gains a significant competitive advantage. It is the aim of Swiff Electronics to capit alize on its high quality and reasonable price while pursuing the innovative entitles necessary for brand building. financialThe companys start up tolls will be $ . Owners equity will be provide $ , $ will consist of short-term borrowing, and the rest will be long-term loans. The majority of the start-up costs will consist of rent, research and development, initial inventory, and a strong cash account. Mission bidding ____________________________________ Swiff Electronics mission is simple and frank Purpose Swiff Electronics exists to provide a faster, more reliable source of power for all mobile phone users.Swiff Electronics sells solutions & results Vision By providing fast response, informed expertise, and consistently high quality solutions, Swiff Electronics aims to generate enough satisfied repeat customers to provide a stable retainer base. This will generates sufficient profit to provide a comfortable living for the owner. Mission The short term objective is to s tart this company quickly and inexpensively, with minimum debt. The long term objective is to grow the company into a stable and profitable entity that the owner can easily and comfortably manage. Marketing Slogan Spot Charge where ever, when ever Keys to Success The keys to success for Swiff Electronics are Marketing and Networking (getting the name out there). Responsiveness ( universe an on-call supplier paramedic with fast response time). Quality (getting the job done office the first time, offering 99. 9% or greater guarantee). Relationships (developing loyal repeat customers retainers). Analysis of the business environment ____________________________________Jamaicas telecommunication sector is dominated by three major players, and a number of small entities that presently supply all the electronic accessories that Jamaicans my need for there cell phone. It has been observed however that none of these companies provide the ease or accessibility of charging your phone w here you want, when you want, Thus the reason why Swiff Electronics has been developed. Over the past five years, the rate of failure of industries in Jamaica has the Great Compromiser relatively steady, and the implementation of saucy businesses and arranging has marginally increased.Swiff Electronics will be a refreshful organization that is not unless established and has not yet developed its clientele. However the fact that the market for call phones keeps growing, as manufactures aim to convert a product that was once used only for communication, to a new revolutionized product that consist of attention grabbing entertainment. The need to keep the batteries of these fascinating gadgets charged Where ever, when ever has arisen, Thus giving Swiff Electrons the carrying into action to be very profitable once the right marketing approach is taken.Presently there are trend that are been experienced in the industry which are classified as unconditional or negative depending on the effects these trend have on particular businesses. These trends include Positive *implementation of additional features to the ordinary phones *Reducing the coat of the gadgets *Reduction in pricing causing more individuals to be able to afford a phone Negative *modification of batteries to have longer manner *Developing unique charging outlet that would be difficult to sourceOver the past year the population of the marketing community has been generally stable based on results obtained form the Statistical Institute of Jamaica. The attitude of the community toward the business has been favorable as the results were seen in a feasibility study that was done in and around the marketing community. Description of product ____________________________________ The Spot Charge, as its name implies is a miniature device, very handy portable charger which is operated on a single AA battery and is able to power up any cell phone batter in minutes.Pretty compacted and stylish, the Spo t charge is like a tube and is small enough to be fitted anywhere. So be it anywhere in the world, you can charge up your phone battery anytime by just plugging one end of the Spot Charge adapter into the unit and the other into the cell your phone. Not only will it charge the battery, thanks to its design you can handle your cell phone while it is charging. There is a blue light at one end of the Spot charge that indicates when cell phones is being charge, and if the light goes out simply replace the battery.Spot Charge is ideal during power outages and when camping, hiking or sailing. It gives you the opportunity to make and receive calls as soon as you plug it in. This device is able to power up a cell phone for two hour of talk time or 40 hours of standby time on one AA battery (included). It Trickle charges an average cell phone in 1 ? hours, and comes with a charging adapter that is compatible with Motorola (Motorola ROKR, Motorola RAZR) Audiovox Kyocera Samsung Nokia Sanyo S ony Ericsson LG cell phone even Blackberry PDAs Spot Charge 3 long x ? diameter and weigh less than 1 oz. Analysis of the competition ____________________________________ Based on preliminary investigation and survey of the market, there were no companies or organizations supplying the product that we are introducing to this market area, Therefore when it comes to identical portable chargers like the Spot Charger there are no real competitors. There are however products that provides that same services as the Spot Charge. These products includes car charger, house hold chargers, which are provided by the following companies. Cable and Wireless ? Digicel ? Centennial Miphone ____________________________________________________________ ____________ ____________________________________________________________ _____________ Production selection Market share Product Quality Quality of service come up of advertizement and production Pricing turnforce turnover Workforce financial cond ition Level of debt Equipment Production capacity ____________________________________________________________ _____________ Pricing Strategies ____________________________________The pricing strategy that Swiff Electronics will be using is to initially undercut our main competitors by selling our product with a small profit of 3%, using a market penetration strategy. Then after getting a share in the market, pricing will be adjusted to be directly competitive with our other major competitors. Swiff Electronics will also maximize sale by spreading the name of the company and products offered by taking part I seasonal sales that will comprise ? The use of coupons ? Bundle pricing This will be done to capture the attention of the overt in the peak shopping seasons.For customers who purchase our product and require the product to be shipped to then, Swiff electronics will comply with these requests however the count price of the product will now include the additional cost for shippi ng. Credit Policy Swiff electronics credit policy will not be the regular policies that we know exist in the business world. What we will be introducing is a policy called cash on delivery, what this therefore means is that we deliver the goods and our customers will liquidate us on the spot.Considering the kind of product we are introducing to the market and that we have no real competition there is no doubt that this policy will work. No other product in Jamaica can do what the spot charge does. This is certainly an advantage in the business that gives us the opportunity to do with our product whatever pleases. Competitive advantage There are no real competitors because Spot charge is new to the market but what we have are potential competitors. The advantages expected would be compared to businesses offering services that are not exactly like Swiff electronics.The quality, price, location and turnaround of the business will all be an advantage over potential competitors. The qua lity of the product is split second to none and the price compares to that of the cost of items that would provide similar service (car charger, regular phone charger etc. ) but the advantage we have is that none of those items are portable and discrete as the spot charge. Market segmentation The market segmentation is divided into the leading target markets. The division reflects the differences in marketing strategy that will be used to target each different market. The yuppies who enjoy being the first on their block to have a new, chic and hip product. The yuppies who follow trends and buy products that everyone else has. Older adults who simply use and depend on their cell phone for business or pleasure. Average college students who seeks convenience while craziness in entertainment. Technologically advance senior citizens. The individual who engage in long distance trips who are plagued by dead battery. Market analysis say-so Customers Expected growth Approximate n umbers 2% 10,000 New Yuppies 3% 20,000 Trend Yuppies 2% 10,000 Older Adults 5% 15,000 College Students 1% 2,000 Senior Citizen 3. % 5,000 Other 16. 5% 47,000 Total Description of Location ____________________________________ Based on results gathered from a feasibility study that was done regarding or product Spot Charge. volume of the individuals who would welcome Spot Charge a part of their daily routine resides outside the metropolitan area of down town Kingston. A decision was concord on by all executive members to locate the first business outlet of Swiff Electronics, within close proximity of the heart of down town Kingston. This would give us an advantage to bring Spot Charge closer to those who have a higher level in interest in the product. A work of the down town area was also carried out, to find out in which area Swiff Electronics would be more profitable. The result of that survey led us to source a shop space th at is located at 13 Duke Street.Duke Street is one of the most busiest streets, in the down town area that Is not only populated by commercial entities but also other small businesses that are doing exceptionally comfortably, which is as a result of their location. With Swiff Electronics being a new kid on the block and the only Electronic/cell phone accessory dealer, we are expecting to welcome a number of curious shopper as well as individuals who are companionshipable about our product and services. Promotional Plan ____________________________________ The ultimate promotional goal of Swiff electronics is to To communication with the target group and create sensation and interest in the service Spot Charge has to offer. To increase the use of Spot Charge, hence eliminate the break in communication associated with dead cell phone batteries. To acquire an increase in revenue. To enhance name recognition There are many ways to market the service offered by the product Spot Cha rge, however, the strategies listed below represent a few cost-effective ways to accomplish the marketing objective. Communication Mix In communicating with the target group, we will use a combination of communication channels such as advertising, publicity, promotions and personal selling. Because people need to hear a message many times from a variety of sources, we will employ a combination of these with a variety of approaches. Advertising strategy Management & Implementation Funding Tasks Responsibility eon frame of reference Utilization of Monitors( big screen Identify what monitors are available in areas Ongoing TV) that are placed in prime areas frequented by draw coordinators Promotions Committee eg Libraries, supermarkets and Identify message content universities and schools etc. Banner in campus cafes and other investigate possibility with cafes to pay Promotions Committee April June 2007 strategic locations what message (link with give up coffee promotion below) Television ads. Radio advertisement Develop appropriate ads emphasizing the Promotions Committee Ongoing benefits of owning a Spot Charge Publicity Strategy Management & Implementation Funding Tasks Responsibility Time Frame Donate time and funds to Identify charitable organizations and investigate Promotions Committee July 2007 charitable organization such aspossible ways of offering time and funding. Children homes and Juvenile Correctional centers Writing articles for the local Produce article with relevant information on the Promotions Committee July 2007 newspaper concerning grand benefits of Spot Charge entrance of Spot Charge Promotions Strategy Management & Implementation Funding Tasks Responsibility Time Frame Presentation of promotional Letter text & printing/ Design brochures. Promotions Committee End of August 2007 product, letter, and brochures Investigate associated cost. at well developed comp anies, Print brochures. shop centers and other frequently visited locations Incentive promotion with phone Investigate how it will work and ways to verify Promotions Committee September 2007 companies- get product at eligibility discounted price with the purchase of any phone. Web site web site of resources and information about Spot Promotions Committee September 2007 Charge and generic attributes picture show message on web or email Investigate costs & how to do this Promotions Committee September 2007 Identify a key message we craving to use it to deliver. Management and personnel Swiff Electronics is currently not hiring any employees. The decision has been made to postpone hiring until the company begins to succeed. After approximately one year, there employees will be added to the current five. Organizational Structure Swiff Electronics is split functionality, In that each division of the company is managed by one of the co-ow ner of the group. Management Team Dexroy Jones is the managing director, and founder of Swiff electronics. Jones was professorship of production at Swiss Army Watches before he decided to return to his native home land to start his own company. He graduate from the University of Technology Jamaica, and received an MBA at The Florida International University. Calford Ramsay head of Marketing and Human Resources division. He has worked and co-owned Wright and Ramsay, an advertising agency, for fifteen years. Ramsay received a BA and MBA from University of Technology Jamaica UTech. Dwayne McKay McIntoch Head of product development division. He was previously vice president of operations at Greentree Sports in Phoenix, AZ.He received his BA from Caribbean Maritime Institute Jamaica CMI and his MBA from UCLA. Keyon Hinds Financial Controller and head of administration. He was previously financial controller of French Collection for United Kingdom FCUK for seven years. He has returned home to provide his knowledge and expertise in the building of Swiff Electronics. He received his BA at the University of Technology Jamaica and a MBA at Cambridge University. Kirkpatrick Binns Operation manager. Binns is the owner of Legendary Manufactures and has worked as operation manager for six years at Docks producers in Marthas Vineyard. He has received a B. Sc. at the University of Technology Jamaica and a MBA at Texas A&M University. Management Team Gaps The following important gaps exist The present team has little sales experience. There is no current in-house designer this should be right within a year. There is no international manager. Personnel The personnel plan calls for adding three employees by the end of the first year for a total of eight. After the second year, employment is expected to increase by another four. These new employees will go into production and sales.Swiff Electronics aims to provide the finest services to its employees. In fulfi lling this aim the company provides benefits for all full time employees which include ? Health plan ? Life insurance ? pension plan The company also observes all public calendar holidays. For public holidays, salary paid employees will receive a day off, and hourly paid employee will receive double pay for the hours worked on these days. All employees are also entitled to three sick days per month however only full time employees will receive pay for these periods. Vacation time is available for all employees having being with the company for a minimum of one year.The following give detail has to how the time is allotted subject VACATION OF YEARS TIME (working days) 1 5 2 4 14 4 and over 28 For employees who may experience a cobblers last in the family they will be eligible for additional days off. For death within the immediate family, employees will receive 4 working days off (spouse, children, parent etc. , and 2 working days off for other members of the family (cousi n, uncle, aunt etc. ). The company will also present a flowered presentation to the team member who has experience such tragedy. Swiff Electronics hiring policies are governed by ? Title VII of the Civil Rights take ons ? Age Discrimination Law ? The Americans with Disability Act ? The Family Leave Act As the company gives equal opportunity to all applicants irrespective of the colour of their skin, religious believe, age, nationality, disability and sexual orientation. Organizational Chart pic Work Schedule pic Work period April 9, 2007 April 15, 2007 Approved by_________________________ Names ITEM QUANTITY NEEDED PRICE FOR EACH TOTAL PRICE Desk 5 4080 20400 Chairs 8 3200 25600 Shelving 9 3700 33300 Lounge chairs 3 6900 20700 Total for furniture and fixtures 100000 Machinery / Equipment Computers 3 40000 120000 Total for machinery and equipment 120000 Checklist for start-up cost Inventory 57,866,000 Furniture and fixtures 100,000 M achinery and equipment 120,000 Prepaid expenses Insurance 150,000 Grand opening advertising 70,000 statutory fees 80,000 Accounting fees Employees wages 300,000 Other Total prepaid expenses 600,000 deposits lease 120,000 Utility Tax 994,500 other 50,000 Total deposits 1,299,500 Building and renovation If purchased Sales price Construction /renovation If leased Leasehold improvements Total location cost 0 Working capital Owners salary 500,000 Employees salary Employee taxes Rent Advertising Utilities Supplies Telephone Legal/accounting fees Loan payment Repairs/maintenance Auto/travel expenses inventory miscellaneous Total working capital 500,000 Total Start-up cost 60,350,500 Financing 1. What are your total start-up costs? $ 60,350,500 2. How overmuch will you invest from personal funds? $350,000 3. How much will you obtain in other equity? 0 4. How much will you borrow? $60,000, 000Bank loan$ 5,000,000 Borrowed for 5 years at 17% interest Finance companies $55,000,000 Borrowed for 7 years at 16. 45% gap Day Balance Sheet Assets real assets Cash (working capital)500,000 Supplies Prepaid expenses465,000 Inventory 57,866,000 Total current assets$ 58,831,000 Fixed assets Furniture/fixtures100,000 Machinery/equipment120,000 Renovations Total fixed assets 220,000 Total assets$ 59,051,000 Liabilities Current liabilities Long term debt 60,000,000 Total current liabilities Long term liabilities Total long term$ 60,000,000 Total liabilities$ 60,000,000 Equity Total liabilities and equity project Income Statement Sales 72,332,500 cost of goods sold beginning inventory 0 + purchases 57,866,000 + freight 0 - ending inventory 0 = cost of goods sold 57,866,000 Gross margin 14,466,500 Expenses Employee wages 300,000 Legal 80,000 Advertising 95,000 Rent 120,000 Depreciation Supplies Utilities 5000 Telephone 3300 Interest Repairs Taxes 994,500 Insurance 150,000 Miscellaneous Total expenses 1,747,800 Net profit 12,718,700 Less income -3,179,675 Less self employed tax -890,309 Net profit after tax 8,648,716 Jan Feb Rent 120,000 Telephone 3,300 Legal 80,000 Insurance 150,000 Total 350,000 3,300 Determine breakeven Contribution margin Projected sales for first year$ 198,738,715 Gross margin$ 173,598,000 Contribution margin =. 87 take to the woods even Total fixed expense4,200,000 Contribution margin0. 87 Break even point BE= 4,200,000/0. 87 = $4,827,586. 21 Legalities ____________________________________ Swiff Electronics is a partnership or limited liability company.The decision to choose this organization form is as a result of legalities that surround our organization. Being a limited liability organization gives us the opportunity to pull together the needed funding as well as a profound and well grounding decision making team. Calfrod Ramsay the Marking manager is curre ntly in discussion with the producers of our product, making agreement to be the main distributor of the Spot Charge within our marketing environment. With that agreement finalize no other company would have legal right to purchase or be a distributor for the manufacture of Spot Charge within this market. Insurance Requirements ____________________________________In ensuring the safety of our employees and property is . Swiff Suppliers ____________________________________ Swiff Electronics source all its products from Teqtronics Manufacturing located in China. Although there are not the only suppliers, Teqtronics has proven to be more consistent in their business agreements and the quality of the product they offer. They are also the only producers of the brand and type of Spot Charge that we will be marketing. The credit terms offered by Teqtronics are unbeatable and they give us the opportunity to choose the quantity of products we would like to order based on the demand of our cu stomers. Uncontrollable risks ____________________________________There are a number of uncontrollable risks that plagues new businesses that are now on the list of Swiff Electronics. These risks include ? Natural disasters Hurricanes Storms Flood etc. ? Rate of inflation ? Changes in technology ? Changes in consumer tasks and life style ? New competition ? The continuous decrease in value of our dollar vs. our counterparts Conclusion ____________________________________ pic Managing Director Dexroy Jones Financial Controller/ Administration Keon Hinds Marketing and HR conductor Calford Ramsay Product Development Dwayne McKay McIntoch Marketing and sales TBA Operations manager Kirkpatrick Binns Administrative Assistant TBA Marketing and Sales TBA