People want vegetables and foods with high nutritional values and great taste. Our national diet can be described as a shame. The problem of obesity is huge.
Our Solution
We use the best agricultural technology available to produce tasty and nutritious vegetables. We start with an existing farm that has custom-innovated equipment. We add horticultural technologies to produce strawberries. This will allow double the utilization of the climate controlled overhead.
Target Market
Competition
Current Alternatives
Alabama is one the top farming regions in the eastern United States. This creates a highly competitive environment for many industry participants. Because almost all produce is commodities and large-scale buyers are more organized than farmers, overall margins are low and competition for wholesaler contracts is fierce. Competitive threats come from three main segments:
Imported vegetables of lower quality
Mississippi pounds raised vegetables
Alabama vegetable producers.
Three farms are directly competing in the individual buyer market segment: the Anniston farm and Organics-To-You vegetable farm. Each of these competitors has produce stands as well as selling to local farmers’ markets. Organics-To-You Farm is the only one that focuses on a niche, while the rest rely heavily on federal subsidies.
Our Advantages
Farmers Group is committed to maximizing the use of current and future agricultural technology in the production and sale of vegetables. A profitable vegetable farm will be acquired by the company. The equipment was custom-designed and manufactured to give it a competitive advantage in the market. Additional use and utilization of horticultural technologies in the production strawberry will enable double the utilization of the climate controlled portion of the overhead. Farmers Group will consolidate the goodwill that has already been established by allowing the possibility of not adding another high production facility to the current supply-demand situation.
The company’s initial goals for the first one year are:
Prepare for the future.
Green Acres vegetable production system should be relocated and expanded in order to make it functional.
Incorporate greens culture in the system.
The composting system must be in full production by the beginning of the second year.
The company plans to replace the least profitable products with practical, cost-efficient products in the long-term.
Wilusa Magazine conducted a survey of downtown residents last year and discovered that hardware stores were one of the top ten essentials to making downtown a great place for people to live. Downtown is a great spot to live and work.
Downtown Indianapolis has witnessed a significant shift in the demographics of home-ownership. Today’s hardware store is often cold and uninviting. It is also located far from downtown Wilusa. Hisarlik Hardware is uniquely positioned to take advantage of this new fact of life. Hisarlik Hardware has parts, materials, advice, and is easily accessible to all areas of Arazawa Township. The store’s goal is to assist customers in identifying what they want and need.
Hisarlik Hardware intends to capitalize on this potential opportunity by offering superior customer service, great product choices, and low prices. The location has been secured to provide excellent traffic and a magnet for the downtown’s only grocery store. The Building blocksparent organization will efficiently plan and lay out the store in order to increase sales and provide customers with the best possible attention. Hisarlik’s management team is well-versed in all aspects of business, finance, and mechanical operations, which will make the venture a worthwhile investment. The projected growth rate for Hisarlik Hardware is quite steady and has the potential to grow exponentially along with the increase in residential development downtown.
Hisarlik Equipment will generate positive cash flow in its first year of operation. Hisarlik will also make a profit its first year of operation.
1.1 Objectives
This business plan has four main objectives. Three are immediate, and the fourth is longer-term.
Assess the feasibility of opening a hardware store downtown.
Develop the strategy to open, manage and grow a profitable downtown hardware store venture.
Establish a firm budget to operate and manage the business from concept to start up to operation, with good cash flow and consistent profits.
Exploit the potential for growth in the downtown markets and discover new opportunities to grow your business.
1.2 Mission
Hisarlik Hardware’s mission it to be a reliable and efficient downtown hardware store. The store will provide great service and a wide selection of hardware and other home improvement products in an environment that is friendly to customers.
Hisarlik Hardware serves downtown residents, business owners, contractors, and suburbanites. The great advice, prompt and professional service, positive staff attitudes, quality of the shopping experience and the ability to provide solutions for customers’ needs will make them loyal.
1.3 Feasibility of the Business
Hector Priamson and Troy Enterprises went through a long and thorough process of looking at different business ventures that would allow them to go into business and be a long-term success. The potential for retail hardware emerged through this process. The following items are ‘#8220′ must have items that will make Hector Priamson & Troy Enterprises a great success.
An industry that is strong, resists economic swings, and allows an entrepreneurial to influence the stores’ results.
A market that has the potential to provide the type of profit that will make a store profitable.
Store location that is easy for customers to locate, allows easy access, ample parking, and offers economic terms that enable the store to succeed.
A co-operative and productive “partner”, such as building blocks,a national Hardware Co-operative that will help to research, plan, market and run a hardware shop.
A financial package to allow the business’s operation and profitability, regardless of whether private investors are involved or not.
Participants must have strong business skills, a strong work ethic and the competitiveness to make the business succeed.
Building Blocks gives you all the tools. Hector Priamson possesses all the management, entrepreneurial, and financial skills necessary to succeed in this industry.
1.4 Keys for Success
Hardware Industry According to the US Department of Commerce, the Home Improvement industry has grown at a steady rate of 7% per annum for the past decade. In 2002, the US had a total of $313 billion. The economy has fluctuated over the past decade but the growth in hardware has continued at the same pace. This country has seen a rise in the popularity of ‘#8220’ Big Box stores, which has had a positive impact on independent hardware stores.
Search: Troas Marketplace was the location for Hisarlik Hardware. Troas Marketplace a retail/commercial property at E. Anglia St. near N. Umberland St. to N. Mercia Blvd. Troas Marketplace is anchored by Buckbasket Cleaners and Scamander’’s Food Market. It is a big draw. Scamander’’s is the only grocery in downtown Wilusa. This location is easily accessible by all downtown residents. It is just one block away of the trendy and hip Wessex Avenue. Troas Marketplace offers ample parking, which is important for downtown.
Urban Product: An urban store in downtown Wilusa requires a different product mix to one found in a suburban shop. Urban dwellers will demand a special product mix. Blocks are a key part of the IAIS program (Inventory Often In Stock) that helps to determine the best products for urban dwellers. Hisarlik Hardware will be in touch with, and focus on, the downtown urban market, delivering products that are applicable to local customers, and marketing these items at competitive prices.
Customers: Hisarlik Hardware will work to be the hardware product source for every building or business in downtown Wilusa. We will try to establish strong relationships with property managers as well as service personnel. A delivery service will be set up to make it easier for customers to obtain the products they require, whenever they need them. Hisarlik Hardware might be convenient and easily accessible, but potential customers may find it difficult to leave their offices. To make doing business easy, it will be important that each customer has a business account.
Construction Blocks – It is vital to have a cooperative like Building Blocks behind efforts to create a store like Hisarlik Hardware. They provide all of the tools to be successful in the hardware business including research, floor plans, marketing, and systems and instructions for operating a hardware store. To become a Building Blocks Member (Member of the Building Blocks Co-op) really means they will provide an entrepreneur a “business in box”, yet allow the members to control their own business. The extensive marketing programs have been developed based on the input of members and are designed to increase sales, traffic, and profits.
Convenience and Service: Convenience and Service are key to this business’ success. These qualities are also strengths of independent hardware retailers. It should be easy for customers to access the store and to navigate. Our personnel have experience in high-end client hospitality. This will make it easier to deal with customers and clients. We will keep detailed records of what customers want that we don’t have in stock.
As mentioned earlier, a delivery service will be established to make it possible for customers of businesses to receive their products in the workplace. We will also target suburban commuters. Happy hour specials to encourage shopping after the five o’clock whistle will be instituted.
% agree
I like to get everything I need for my home maintenance projects in one
76.3%
I love the ability to shop for home decor items and build materials
31.4%
A neighborhood hardware store meets most of my home improvement/maintenance needs
25.8%
For most purchases, I prefer a neighborhood hardware store instead of a large home improvement center
24.1%
—Retail Forward, Home Improvement Shopper Update, 2001
Repair/Project Area: Hisarlik Hardware will benefit from the established reputation of exceptional service built by other BlocksCooperative member stores. This reputation has helped Building Blocks to be one of the top independent hardware stores (from Consumer Checkbook Aug 2003). It also fills the gap in the #8220Big Box#8221 retailers one-size-fits all offerings. The Customer can access the Resource area and ask for assistance or directions at any time they visit the store. This area will offer help and support in the beginning of a project. It will help them find what they need, share their knowledge, and give advice on how to complete a job. Employees at the store will be trained in home repair/projects, home improvements, and mechanical repairs and retrofitting. The resource area can also be used for demonstrations and training in home repair and home improvements projects.
The Tool Room Rental: A rental business will be established under the Building Blocks’ “The Tool Room Rentals” tool rental program. This will help to generate additional revenue as each tool requires accessories. We will also think about party rental items to be included in the rental inventory. Building Blocks will aid in developing the right rental product mix for this urban market.
All these key factors will work together to increase sales and eventually net profit.
Web Solutions, Inc., (Web Solutions) can be described as an Internet Service Provider, ISP based in Phoenix, Arizona. The company offers the following services to its customers:
Internet access up to 64 Kbps via dialup
High bandwidth Internet access (128 kbps).
Integrated Services Digital Network (ISDN).
Digital Subscriber Line
Wireless.
Website and virtual domain hosting.
Server co-location
Network design, installation, and administration services.
Web design (currently being outsourced).
Web Solutions is an organization that strives to provide customers with the best possible Internet and private networks solutions. Customers include all consumers, small to medium-sized companies, and start-ups.
Web Solutions can benefit from many strategic alliances that allow it to obtain very competitive pricing for almost all its services. This allows them to offer their customers competitive pricing.
ISPs allow people to access the Internet. International Data Corporation (IDC), which is an information technology research consultancy based in Framingham Massachusetts states that the market for consumer ISPs in 2003 will rise from $10.7billion in 1998, to $37billion in 2003.
Other ISPs in Phoenix pose competitive threats, including Mindspring, Arizona.Net and EarthLink. Most competitors offer Windows and Macintosh solutions, but they do not support all operating systems. With the rise of Linux and other alternative operating systems, there is potential for Web Solutions to surpass its competitors.
Web Solutions has a world-class management staff with direct industry knowledge, extensive experience in research, and unique administrative skills. Its team includes Ms. Geena Williams, Mr. Jason Williams, and Mrs. Amy Williams.
Projectioned revenue growth for 2000-2002 is substantial. The company seeks a large investment to finance four areas of company growth.
Increase the number of people who are responsible for sales, development, and service.
To ensure future customers are well-informed about our products and competitive pricing, we need to increase marketing.
Expand our base of operations (using wholesale providers, partnerships, and other mechanisms) to include at least the top 100 U.S. markets for dialup and dedicated Internet access.
Perform research and development to bring new products to market.
1.1 Mission
The mission of Web Solutions is to provide customers with a complete solution to all their current and future Internet and private network needs.
Web Solutions is known for its quality work, and the company plans to improve its reputation in the industry. Web Solutions aspires to be a respected and well-respected provider of advanced network solutions.
Increasing the number of services offered
Customers are more likely to be available and accessible.
It is our mission to create cost-effective, innovative and innovative solutions to customer problems.
Barnum Painters is committed to providing high-quality interior and external residential and commercial painting service. The principal officers of Barnum Painters believe that most companies in this industry suffer two major problems. These are poor scheduling of job projects and poor retention of quality employees. Both these issues lead to customer dissatisfaction, low repeat business, and low word-of mouth referral rates. Barnum Painters believes this contractor business strategy can help it exploit its weaknesses to increase local market share.
The objectives for Barnum Painters over the next three years are:
To achieve sales revenue of approximately $620,000 within the third year.
To reach a customer mix that is 30% commercial and 10% residential per year.
Expanding operations to include all of the Greater Seattle region, Kirkland Renton, and the Kitsap Peninsula.
The company will do everything possible to provide the best painting services to its customers. This includes ensuring that they are available when needed and maintaining a quality-control program that ensures 100% customer satisfaction. Principal officers of the company see every contract as an agreement between two partners, not between customers and businesses. They want to build a long-lasting relationship that is mutually beneficial. This will result in greater long-term profits via referrals and repeat customers.
Barnum Painters will institute the following key procedures to reach its goals:
Have at least one expediter assigned for each project.
Each project should have a project manager who is able to handle quality-control issues.
Establish a profit sharing plan for all employees.
Barnum Painters Limited Liability Company is a new start-up with three principal officers, each of whom has over 40 years industry experience. Barnum Painters will be a partnership between Mr. William Barnum, Mr. Anthony Barnum and Mr. Michael Kruger. The principals will be investing significant amounts of their own capital into the company and will also be seeking a loan of $7,000 to cover start-up costs and future growth. A $10,000 line of credit has been obtained by the company (not shown in financial statements). This credit can be used for any unforeseen expenses.
Barnum Painters will be located at a rented unit in Rucker Industrial Park, 710 Snoquamie Route Suite 250, Edmonds, WA. There will be a reception, offices for principals, inventory storage, and an employee lounge. Barnum Painters offers a wide variety of services primarily focused on interior and exterior residential and commercial painting. Additionally, the firm offers services such drywall plastering as well as acoustic ceilings, pressure washing and other related services. The aim is to provide clients a broad range related services that will minimize the need for multiple contractors. Barnum Painters will be able to provide a low-cost, high-quality leadership strategy.
Initially, the company will only be serving residential and commercial customers in Everett. The company plans to serve the entire Puget Sound region by the end the three-year projections. The company has rigorously examined its financial projections and concluded that they are both conservative in profits and generous in expenditures. This was done intentionally to allow for unexpected events. According to the company’s principals, cash flow projections seem realistic.
Keys for Success
Barnum Painters’ principal officers are experienced in the contracting industry for many years. They believe that most companies in this industry, which includes painting contractors, suffer from two major problems that Barnum Painters can improve upon and exploit.
The scheduling of jobs can be the first problem. It is difficult for many painting contractors to keep their schedules straight with customers, which can lead to customer dissatisfaction and loss. This can be caused by poor management, less reliable employees, delays in inventory distribution, and poor inventory procurement. The second problem is in retaining reliable and motivated personnel. Many painting companies rely upon temporary or transient employees which results in high turnover rates and reduced service quality.
These are the key procedures Barnum Painters will use:
Incorporation of an inventory coordinator position and at least one expediter for each project.
Each project should have a project manager who is able to handle quality control issues.
All employees should be encouraged to participate in a profit sharing program.
Mission
Barnum Painters aims to provide the highest quality interior and exterior residential as well as commercial painting services. This company will ensure that these services are provided in a timely manner, with a continuous quality control program to ensure customer satisfaction. Principal officers of the company see every contract as an agreement between two partners, not between customers and businesses. They are meant to be a long-term partnership that is mutually beneficial. This will lead to greater long-term profitability through referrals, repeat business, and other activities.
Objectives
Barnum Painters’ goals for the next three-years are:
In the third year, sales revenues will be approximately $450,000
You can achieve a client mix of 30% commercial and 10% residential building contracts each year.
Expand operations to include all the Greater Seattle area including Kirkland, Renton and the Kitsap Peninsula.
Companies must ensure their employees are provided with the best tools and training. Retreats can be used to support colleagues and help them work together. This helps reduce turnover. Happy coworkers mean happy customers
Solution
Corporate Retreat Professionals (CRP), an event planning company that specializes in corporate clients, is called Corporate Retreat Professionals. CRP will offer retreat training services and product launches event planning. You can choose to receive retreat training in leadership development or team building skills training. CRP can help with both the planning and hosting of these types of retreats by partnering with one of its strategic business partners.
Market
Event planning is a profitable business. In some cases, large companies will have to make cuts in their training budgets due to economic downturns. For short-sighted companies, however, this may not be true. The benchmark companies may trim down the workforce during a downturn, but they do not cut funds for training. They know that investing in human capital is always a wise investment. CRP plans to make good on this. In economic downturns, many companies still have product launches, and will still require someone to organize them. CRP will take advantage of this increasing demand to provide corporate event planning and hosting services.
Concurrence
In the past, large corporations were able to buy from outside vendors. This trend is changing in favor of outsourcing. There is an insatiable desire to increase efficiency.
Why Us?
Corporate Retreat Professionals will provide companies with the highest level of event planning. Our goal is to keep customers coming back. Everything else will follow this principle. Our services will meet or exceed customer expectations.
Expectations
Financial Highlights for the Year
You will need financing
We will be getting $50,000 from the owner and founder of the company.
Despite the continuing slide in this industry, the US housing sector saw its record-breaking $550.14Billion gain last year. The sector will continue to grow steadily over the next two years. New single-family housing construction, which accounted for 67% total residential construction in the US, is one of the highest revenue-generating segments in this segment.
The industry’s business model has changed over the years to be more efficient and cost-effective. Low entry barriers (other than the need to obtain state-based licenses and registration) in the industry had spawned more service providers in the industry. Competition is largely determined by reputation and performance, as many newcomers find it difficult to gain a foothold within the market.
Existing firms have many advantages over newcomers. They:
Get access to skilled subcontractors.
Keep in touch with your suppliers.
Maintain good relationships with property developers and financial institutions.
They can show completed examples of their work and generate ‘word-of mouth’ referrals.
KnaelHaed ASPware is a provider Web-based vertical market software solutions. The DigitalSuspenders is an online software solution to be offered by KnaelHaed ASPware in support of the building construction process.
The Problem
In research and development investment, the construction industry is not as advanced as other industries. R&D expenditures for mature US corporations are usually around 3.5%. For some industries such as aerospace that number can be 7% to 14%. Construction only reinvests 0.5%. The reasons for the low reinvestment vary, but are generally due to costs and complexity. The majority of construction firms have less than 10 workers and are limited in their profit margins. So, technology spending is often seen as an unaffordable luxury.
The solution
DigitalSuspenders, a suite of integrated Web-based software applications, will support the entire building cycle, from conception through construction and to maintenance. The suite offers online collaboration, digital takesoff, estimating, as well project and property management capabilities. This is all in an easily understood and easy to use format.
The Market Size
According to the most current Economic Census, the home construction industry has 163,703 establishments. It employs 796.880 workers. According to the most recent Economic Census, the industry has seen a record growth of 175,000 establishments over the past few years. Meanwhile, the US commercial and institutional building industries are comprised of 34,588 establishments. The construction industry accounts for approximately 8% of US GDP.
Start-up costs
KnaelHaed ASPware anticipates initially requiring $120,000 to complete the beta prototype of the DigitalSuspenders, provide for legal and infrastructure expenses related to start up and to cultivate potential customers. We are looking for angel investors and corporate partners to fund the initial capital.
Potential Payoff
KnaelHaed ASPware estimates break-even in less than two years. We expect royalty income from licensing our position sensing system and software technology. KnaelHaed ASPware plans to launch or sell the company within three to 5 years to stimulate further growth, and to provide liquidity for investors.
Management Team
Paul Peen, currently President & Chief executive officer, has over 20 year experience in commercial software development. This includes stints at Microsoft, Expedia.com, and Microsoft.
Leveraging connectivity, interactivity and speed, KnaelHaed ASPware is the first of its kind offering both efficiency and cost saving strategy to builders and subcontractors. KnaelHaed can offer competitive pricing for solutions via outsourcing. KnaelHaed ASPware is dedicated to the development of new ideas that are useful in achieving clients’ objectives. Together, the owners’ passion and accumulated field work has made KnaelHaed ASPware more than “just-another-outsourcing-hub”, but a catalyst for the next e-commerce re-invention.
1.1 Objectives
The mission of KnaelHaed ASPware is to provide a medium for custom builders, general contractors, design builders, engineer-contractors, joint-venture contractors, and turnkey contractors to outsource their works with greater cost saving efficiency.
This model is intended to be a disruptive force against the majority of construction software companies, which charge hundreds of dollars for each copy. KnaelHaed ASPware’s plan is to offer a limited number of these capabilities at no cost. KnaelHaed ASPware’s ideal mission is to offer better solutions to all stakeholders by using the open-source model.
1.2 Mission
Our target market is builders and subcontractors who want to profit from outsourcing. Software companies provide software products that are very expensive for small and mid-sized users. Considering that the typical home builders construct only about a dozen homes per year, there are only a few companies that may then be considered large enough, with sufficient financial resources to pay for premium licensing of a software package.
We estimate that roughly 60% of the US market will fall under the category of small and middle builders. That would equal 118,980 establishments. Our focus will be directed to these establishments that are prioritizing on cost efficiency and precise results.
1.3 Keys for Success
We have targeted the construction market for several reasons. As a $787 billion industry (both residential and commercial), it offers significant growth potential. The annual unit growth of the number of establishments in the housing sector averaged 6.45% and commercial/institutional sector 0.46% last year.
Despite the lackluster growth in the construction sector, it is still a highly fragmented industry. Within the US alone there are over 200,000 establishments (both housing and commercial/institutional) on record.
Our success is based on these keys:
Building and maintaining strategic alliances for our software vendors as well as other industry partners
Adopting a customer-centric and market-focused sales/marketing paradigm
Managing the business by implementing, and consistently measuring and adjusting the fundamentals of a Balanced Scorecard:
Wheelie Deals works as a wholesale distributor to the retail bike industry. Wheelie Deals has carved out a niche for itself in the industry by providing closeouts and last-year models as well as seconds. While most large wholesalers have closeouts available, there is not much availability of special deals. Wheelie Deals will soon be the number one source for retail shops that offer above-average margins.
Wheelie Deals, headed by Dan Psycle MBA and a veteran in bicycle manufacturing, is led by Dan Psycle. Dan has taken the model of a well-established wholesale distributor business model and created Wheelie Deals. This will allow him to quickly increase market share. Profitability can be achieved by month eight, with comfortable profits by the end of year three.
1.1 Objectives
The objectives for the first three years of operation include:
To create a company with the goal of exceeding customer’s expectations.
To increase the number and quality of customers served annually by 20%
It is essential to have a viable start-up company that can survive without external funding.
1.2 Mission
Wheeliedeals’#8217 mission is create the largest selection possible of low-priced bicycle parts. Our goal is to keep customers coming back. When we adhere to this maxim, everything else will fall into place. Our services will exceed the expectations of our customers.
1.3 Keys to Success
A great selection and excellent customer service is the key to success.
Passion Soles is a women-only shoe store in Eugene, OR. Eugene badly needs an upscale shoe store for women because the current stores have an inadequate selection. Currently, women that need a special pair of shoes often must travel up to Portland to find the right shoes.
Passion Soles will offer a wide range of shoes. Passion Soles’s shoe selection is usually too big due to the number of sizes that must stocked for each style. Passion Soles’ unique business model allows them to offer a wide selection while only stocking one size per type. Passion Soles is able to receive the size they need within two days thanks to a special relationship. Rush overnight shipping is possible at an additional fee.
Passion Soles will benefit from Holly Heels’#8217 specialized knowledge in the women’s shoe industry to quickly gain market share. Profitability will be reached by month ten and $284,000 will be generated in revenue in year three.
1. Keys to Success
It is important to satisfy the customer demand for a high-end women’s shoe shop with a large selection and personalized customer service.
1.2 Objectives
The following objectives are set for the initial three years of operation
To create a product-based, retail store whose primary objective is to exceed customer’’s expectations.
To increase the number and quality of clients served annually by 20% by satisfying unmet customer needs through outstanding selections and exceptional customer service.
It is necessary to have a sustainable cash flow in order to start up a business.
1.3 Mission
Passion Soles’#8217′ mission is provide Eugene with a premium selection of women’s shoes and outstanding customer services. We exist to bring in and keep customers. If we follow this maxim, all else will follow. Our services will exceed our customers’ expectations.
The Southwest Veterinary Clinic will be located in southwest Richmond. The clinic will offer full medical services to pet owners. Southwest Richmond is made up of both industrial and residential properties. There are approximately 20,000 moderate-income residents in the area. Many of these people are seniors with multiple pets.
For most people living in southwest Richmond, the nearest three veterinary hospitals are within fifteen minutes drive. Southwest Veterinary Clinic will only be five minutes away from most of the locations in southwest Richmond.
Michelle Johnson, DVM and Edward Anderson DVM are both veterinary professionals with seven years experience. Edward has four years of experience with the Richmond Emergency Veterinary Hospital. Michelle has been with Blue Cross Hospital as a staff veterinarian for three years.
Residents in Southwest Richmond can be served by both Richmond Emergency Hospital and Blue Cross Hospitals. Michelle and Edward treated many pets in the southwest part of town over their years. The service received by most of these clients was highly praised. Thirty customers already confirmed that the new hospital services will be used by them.
1.1 Mission
Our goal is to help customers’ pets live long, happy and healthy lives. Your veterinarian is an essential part of a healthy pet. Everyone at Southwest Veterinary Clinic is committed to professional, caring, personalized service. Southwest Veterinary Clinic is proud to offer the best veterinary medicine. Our clinic offers a full-service offering, including the latest veterinary medical technology.
1.2 Keys for Success
We treat patients as if our own pets.
We provide individualized care for each patient and help clients make informed decisions about the health of their companion animals.
American Management Technology will increase its sales by over $9 million within three years by focusing its strengths, key customers, and the fundamental values they require. This will allow American Management Technology to improve its gross margins on sales, cash management, working capital, and overall profitability.
This business plan shows the way. It renews our vision and strategic focus: adding value to our target market segments, the small business and high-end home office users, in our local market. It provides a step-by-step guideline for increasing our sales, gross margins, and profitability. We plan to borrow $100,000 more long-term to help us implement these changes and increase profitability. This amount seems to be in-line with the capabilities of our balance sheets.
AMT is based on the idea that information technology management for business is similar to legal advice, accounting, and graphic arts. It is not a do it yourself job. Business people need to look for reliable vendors that can provide quality support, hardware, software, and service. These vendors must be trusted as well as their professional service providers. AMT seeks these requirements and is striving to be the leading regional provider of business information technology.
AMT provides small business with both computer products as well as services. We are especially focused on providing network systems and services to small and medium business. The systems are available in both minicomputer-server-based and PC-based networks. Our services include training, support, design and installation of network system, as well as training.
Our keys to success for the next three year to achieve our objectives are:
By offering support and service, and charging for it, you can distinguish yourself from price-oriented and box-pushing businesses.
Increase gross margin to greater than 30%
Our non-hardware revenue will be 20% of total sales in the third year.
AMT was established as a value-oriented reseller (VAR) in consulting. It became a reseller to meet the demand for personal computers on the market. AMT emphasizes service and support to distinguish itself from its price-oriented rivals.
One location, a 7,000 square-foot store in a suburb shopping center is located near the downtown. It has a training area and a service department. There are also offices, offices, and a showroom.
AMT is a privately held C corporation that is majority owned by Ralph Jones, its founder and president. Six people are part owners of AMT, which includes four investors and two employees. Under the leadership of the president and four others, there are 21 employees. Our major management divisions are service, sales, marketing, and administration. The service division handles support requests, training, development, and training. At present, we are weakest in the area of technical capabilities to manage the database marketing programs and upgraded service and support, particularly with cross-platform networks. We also need to find a training manager.
Recent changes to the computer reseller market have adversely impacted AMT. Margin squeezes, longer collection periods and lower inventory turnovers are just a few of the factors that have adversely affected AMT. All of these concerns are part of the general trend affecting computer resellers. The margin squeeze is happening throughout the computer industry worldwide.
Only way to stand out is to make the company an information technology ally for our clients. We will not be able to compete in any effective way with the chains using boxes or products as appliances. We need to offer a real alliance that includes such intangibles as confidence, reliability, and knowing that somebody will be there to answer questions and help at the important times.
Our support services, with which we hope to capture market share will include such services as; training, upgrade offers, installation services, network configuration services, etc. The company will seek to aggressively pursue new opportunities.
AMT focuses on local markets, small business and home office, with special focus on the high-end home office and the 5-20 unit small business office.
We last saw a study that showed retail sales increasing at 5% per yr, while web sales are increasing at 25% to 30%.
There are several different kinds of computer retailers within the industry including:
Computer dealers often focus on a handful of major brands of hardware. They usually offer minimal software and variable levels of support.
Their service and support are generally not very good. Also, their prices are often higher than those at larger stores.
Computer superstores or chain stores offer decent walk-in services, but very limited support.
Mail order offers aggressive pricing for boxed goods. For the purely price-driven buyer, who buys boxes and expects no service, these are very good options.
No one of these competitors offers the kind of personalized and personal service small businesses like our clients really want.
Small business buyers are more comfortable buying from vendors who visit their offices. They expect copy machine vendors, office product vendors, and office furnishings vendors to visit their offices in order to make sales. Many small businesses immediately go to superstores (office supplies, electronics, and office equipment) to get the best price. They don’t realize there is an even better option at a fraction more.
We need to effectively compete against the idea that businesses should buy computers as plug-in appliances that don’t need ongoing service, support, and training. Focus groups showed that the home office market is not focused on price. However, they would consider quality service if the offer was properly presented. Because they only see price, they think about it. We have very good indications that many would rather pay 10-20% more for a relationship with a long-term vendor providing back-up and quality service and support; they end up in the box-pusher channels because they aren’t aware of the alternatives.
We rely on newspaper advertising to reach new customers. However, as we shift strategies, we must also change the way that we market ourselves. We will be focusing our efforts on our core message of service via radio, cable TV and sales brochures. We must sell our company, not the products. We sell AMT, not Apple or IBM, Hewlett-Packard and Compaq.
Our ambitious sales forecast is summarized in the Yearly Total Sales Chart. Sales are expected to rise from $5.3 million lastyear to more than $6million next year, and to more $9 million in this last year.
1.1 Objectives
Sales increasing to more than $9 million by the third year.
Keep the gross margin at 30%.
Selling $1.5 million worth of support, service, and training services by 1998
By 1998, increase inventory turnover to six turns
Success: 1.2 Keys
By offering service and support, and charging for it, you can distinguish yourself from box-pushing and price-oriented businesses.
Gross margin to 30%
Our non-hardware revenues will reach 20% of our total sales in the third fiscal year.
1.3 Mission
AMT is based on the idea that information technology management for business is similar to legal advice, accounting, and graphic arts. It is not a do it yourself job. Business people need to look for reliable vendors that can provide quality support, hardware, software, and service. They should use quality vendors just like they use professional service suppliers as trusted friends.
AMT is an example of such a vendor. AMT serves its clients as an ally and trusted friend. It provides them the benefits of both a business partner, and the economics of an external vendor. We ensure that our clients have the tools they need to operate their businesses efficiently and with reliability. We give our clients peace of mind because many of our information applications are critical.
