Description of the Company
As the name advocates, Plush was generated out of the passion, love, and dedication of the owner for the art of tattoos, manicure and pedicure as well as the haircut for the developing demand and fashions in the market. The goals and objective of the company is to offer the highest and quality services for the professionals like footballers and actors within the region. The firm’s initial investment is $40,000, with the annual target earnings equivalent to $ 50,000. Further, the organization will continuously innovate and adapt to the new demands from the customers in the area. Other than servicing the people within the area, Plush has the intention of opening its branches to other cities and town to ensure that it widens the range of its clients, before venturing to other countries. As per now, the company will concentrate on the Plush outlet as the platform where the residents can get the quality services the customer requirements. Moreover, the outlet will provide the maximum cost-effective ways in order to promote the products of the company as the customers get to try these services while still using and paying for the same.
The Plush Company will customize its services to meet all the interest and demands of the clients in the region. Other than the services listed above, the company will modify its outlet so that it provides the environment that caters to all the requirements of its clients. Also, the strategy of the company aims to increase the time the clients spend at the outlet in order to grow revenues. The targeted market of the company mostly includes the enthusiastic internet users who continuously utilize internet to communicate with friends and family. As a result, there is a high demand for a free wireless internet which the company offers to attract more customers.
The goals of the company within the first year of operations include;
- To sustain a 60% gross margin.
- To break-even within the fifth month of its operation.
- To merge the leading outlet for Barbershop in the region.
The success of Plush Company relies on the following factors;
- Knowledge and understanding of the target market.
- The provision of high-quality products which are provided at affordable price. The firm will have efficient and experienced barbers to deliver all the demands of the clients.
- The existence of the motivated and passionate workers who provides a memorable experience for the customers.
- Efficient marketing in order to build as well as maintain a steady base of loyal clients.
- Innovate Barber outlet strategy to offer a conducive environment for all the customers.
- Workers training to increase the delivery of quality services.
The primary mission of the organization is to offer the greatest quality services in the unique as well as a conducive environment where customers can socialize and relax with each other. Plush aims to make sure that all the clients have a comfortable place where they may enjoy the greatest quality provided in the Plush Company offered in a friendly way.
Industry Analysis and Trends
The analysis depicts that the company has over the years experienced a tremendous development specifically regarding the services provided by the Plush Company in the region. Further, the demand from the clients concerning the products has increased with the clients learning the special products offered in the company. The latest research conducted in Sultanate of Oman shows that there is an increase of 50% on the people living in Oman have developed the growing trend of a new haircut, body tattoos as well as spa services. As a result, there is a growing demand for people requiring their services making Plush relevant in the market. The closest rival of Plush Company is the Rock Mountain Barber which has been growing in at a rate of 3% since the year 2014. However, the difference between the companies in the market presents a great potential available in the market.
The current trend in Oman indicates that the highest opportunity within the industry depends on the provision of specialty barber services hence, explaining why the Plush mainly focuses on the particular products. Within the area, 22% of the clients at the outlet are of the age between 18-24 years which is the prime age of the fashions, 65% of these people have an income of $120,000 hence, doing the service at Plush within reach. Moreover, the high demand for the services and products offered at Plush makes it relevant and competitive in the market.
The Plush Company targets the unique and specific customers especially the professionals in the market. The organization appreciates the fact that over the year of establishment, the company has been able to realize most of the objectives and goals it had formulated. The most significant thing is that the individuals getting the services within Oman are satisfied with both the products and employees relation. Further, Plush has able to identify its primary target in the market, and this knowledge has been relevant in the strategy and development of the services and products obtained. As stated earlier, the central target market of the company mainly includes the professional who prefers the latest fashion in the industry and the wealthy people who require massage as well as the high-class people in the society who either need manicure or pedicure.
Moreover, the company targets the customers who have a great preference for an extra and specific feature within the industry. Therefore, the company has both the pre and postpaid services to facilitate the smooth operation of the company. On the other hand, Plush believes its target market to broaden in the future as the clients are becoming more aware of the services and products via the internet and the company website. Further, the company ensures that they have an effective and sustainable relationship with their customers. As a result, communication has been a core ingredient in ensuring the success of the company. The organization has implemented websites pages and integrated the website with the communication system in the company to ensure that the company is continuously in touch with the clients. Also, with the feedback that the company obtains are used in ensuring that all the concerns are addressed and that all the clients are satisfied with the products they offer.
A number of the leading players within the industry such as Rocky Mountain barber shop poses the main competition in the market. For instance, the Rock Mountain barber operates within more than 7000 locations in Oman. Within the industry, the competition is as a result of the client’s preferences, tastes, and income. Therefore, the company will strive to produce the best services and products to ensure that the company remains relevant and achieving the sustainable competitive edge. It is more important to note that, the profitability of the companies in this industry rely on their ability to provide the high-quality services and products, secure a prime location to set their shop as well as drive store traffic.
Large companies have the benefit of the small organizations especially those that are start-up such as Plush since having adequate sources of funds to market and finance their processes. Consequently, Plush will have to compete effectively through offering specialized services, pursuing the native market, plus providing the memorable client’s experience. This industry over the year has been increasing in Oman with the increase of the professionals and with the development of new fashions in the market. Thus, the leading organizations in this industry generate above 80% of the total summation of their sales in the market.
Therefore, BrberLink anticipates gaining profit from the industry because of the numerous factors. In the beginning, the company has witnessed a continuous growth in the disposable profits as well as client confidence within the economy of the country. Presently, the consumers are ready to spend more cash in the shop to attain the best products from the company. Despite the developing demands, the company expects an intense competition is anticipated in the industry because of the developing number of the players pursuing to benefit from the growth in the size of the market available. Therefore, Plush Company will make sure that it avails innovative services that are exceptionally priced. Besides, the organization will have the variety of services and products satisfying the requirements of the health-conscious items. Though, Plush firm still expects the tough competition from the industry heavyweights like Rock Mountain Baber that have the market presence within the region.
Strategic Position and Risk Assessment
The Plush will apply an approach of the total market service that entails the provision of the unique services and products attracting the complete spectrum in the industry as well as providing the conducive environment for all the customers. Further, the firm aims to provide a memorable experience not just selling their product and services. Also, the firm intends to be part and parcel of the community of their clients. This strategy, therefore, presumes that every person is a potential customer and ensures that the market experience a tremendous development in future. Also, it suggests that the best method to drive sales is by selling to the soft needs of the clients.
The company uses the competitive pricing in that the company sets the prices relevant to that of the rival companies, to make sure that it sustains the high profitability degree for the sustainability and development. Nevertheless, with the aim of distinguishing itself from the other competing companies, the Plush Company will have specific promotions and discounts that are unique to ensure the loyalty of the customers. Moreover, it will engage in website and television advertisement of all the services and products that they provide to increase the awareness of the company.
The company will market its products through franchising in which the company will work with some other Barber outlets in the region. Under the agreement, the outlets will submit an approximate of 20% of the sales benefits annually that will, therefore, sum up to the company’s 40% of the expected gross annual income. Further, the Plush firm will promote its products through online platforms and advertisement to reach multiple customers in the region specifically the high-class individuals within the community. The firm has entered into an annual program to ensure that their products are constantly advertised in the televisions and websites to promote awareness of the products and services the company produces.
Plush will sell its products via the online platforms such as facebook and twitter, which is expected to raise the sales of the company by 30%. Thus, through the website of the company and the social media, the clients will place their orders for these services to be delivered at their places of residences. Furthermore, Plush Company will partner with other distributors who operate in the area to make it possible for the sales and targeted income. Hence, the clients will have the appropriate opportunity to order from their cell phone and book for the services they require at a particular time. The sales approaches are expected to increase the sales of the organization because of the timely delivery of the products which will, in turn, boost the satisfaction of the clients.
There are some risks that the company has to take into consideration to succeed and to be profitable.
Regulatory risk. The Plush Company faces the risk of the government of Oman imposing certain restrictions which require complying with such as specific production standards which may, in turn, increase the product cost. This may affect the price and the profitability of the company.
Contingent liability risk. The organization faces the risk of plausible lawsuits from the clients who suffer health complications after using the products from the company. Thus, Plush Company provides for this risk by sterilizing all the equipment used in the shop as well as setting a sustainable contingency fund for paying for the damages caused by the lawsuits.
Marketing Plan & Sales Strategy
The Plush Company has a diffident marketing budget. Consequently, the firm applies the innovative strategy in order to reach the market that the company targets. Moreover, the aim of the company is to spend no more than $500 in the sector of marketing a month.
Ethics & Social Responsibility Plan
By definition, business ethics is the moral recommendation which the organization ought to follow while conducting its activities. Normally, these ethics are based on the notions of the right, wrong or considered fair, and it concerns the suppliers, employees, customers and the stakeholders in the business. Therefore, it is imperative for the Plush to conduct all the business operations ethically to pass their beliefs, morals and values down to the customers and workers. Similarly, the social responsibility is equally vital in the business ethics since it regards caring for the organization’s employees, being responsible socially and environmentally, as well as ensuring that they give back to the society. A number of the standards practices which a socially responsible company engages in the community includes; assisting the less fortunate in the community, and participating in fundraising for the street children, which the company has been engaging in since it was formed.
The main social responsibility of the company is to create job opportunity just like any other company within the region. All the societies hope that when an organization is established, it will be capable of generating jobs for all the local people living in the area. Therefore, Plush as any other company creates jobs for both the young and old individuals in the region where the outlet is established. Further, the department of human resource is committed to the honest as well as fair of the workers. Moreover, the human resource sector encourages for the employees to be treated with a lot of respect, honesty, and fairness while at the workplace. Preferences of the employees and customers with the management and fellow customers are discouraged as it discourages the workers who are working hard, also may create an issue in the workplace. For the employees to feel appreciated for all the work they do, then they should be treated with both honesty and fairness in the company.
Also, hiring the right employees and being fail while hiring is an issue to be considered. The Plush is always ethical when hiring its employees and while dealing with both customer and workers within the company. At the time of hiring, all the individual that have applied for the work are given a fair and equal opportunity to join the workforce of the company. Moreover, the organization encourages all the candidates applying for a position in the firm from all diversity of people, and all are treated without discrimination at the time of hiring. Since having a varied workforce will make the company provide opportunities to all the people who feel disfranchised.
Also, Plush company will over the years embark on the partnerships with the local facilities like a football team or a movie publisher to provide both part-time as well as full-time partners the chance to assess their services however the time limits. Thus, this will assist in empowering people who are employed in Plush as in the course of interaction with the customers; they will be able to advance their careers and get promotions in case of excellent work done in the company. Also, the workers in the company will be able to learn new tricks of the business through the program.
The rationale of the company is to empower the young people in the community. The young people are the most significant part of the community. Therefore, they should be supported to realize their objectives. Additionally, helping the youths in the community will help them become better citizens who can rely on themselves and plan for their future. The opportunity will also prevent the teenagers from engaging in the criminal activities like drugs and violence. Overall, this venture is essential to the company as it provides the firm with the opportunity to give back to the community which is significant in the development of the community.
One of the negative health problems that are associated with this industry is the infections that an individual can attain from the cuts which they may get from the process of a haircut. This may increase the risk of the individual contacting infections such as tetanus among others. This may cause a scandal and lead to the company losing their loyal customers which then can result in the company losing its capital plus the profits.
As a result, the strategy of the organization to mitigate the negative which might be linked to the company is major to train the employees to sterilize the equipment before and after using them constantly. The company will also educate its clients on how to keep safe from all these infections and how to approach the matter in case they are cut during the serves. The Plush workers will be trained on how to huddle the clients that might have suffered a cut during the hairdressing. Further, this will be achieved by the community sensitization which the organization conducts as well as the workers involved will have the opportunity to train the members of the community on the dangers and how to treat the wounds in case of the cuts to ensure that they are healthy. Through the forums, the community will be trained, and responsible behavior will be encouraged.
The plan of the company to target as well as reach the suitable market department I via the adverts. These adverts will show the responsible ways and methods of keeping safe and being responsible. The workers will be trained and advised on how to approach such situation in case they happen to prevent the company from losing its loyal clients. Overall, the workers training is essential when it comes to the targeted market since they are the ones who are directly interacting with the clients.
The companies which have businesses in various communities must be involved with the social responsibilities which are as a result of doing the firms in the society. Therefore, the companies must exercise being good cooperate, citizens, thus, Plush Company is no exception. This will assist the organization to relate well with the employees, stakeholders as well as their clients to provide quality services and products and help for the betterment of the community.
The Plush Company is seeking a loan of the amount $10,000 plus the $15,000 being invested by owners of the business.
The table below gives a summary of the main facets of the projected organization performance.
|The Gross Profit||$170,000||$220,000|
|The Operating Cash Flow||$1500,000||$200,000|
|Debt Service Coverage||$10,000||$10,000|
The highlights of the financial forecasts are provided in the table below;
Summary of the cash flow and balances
|The Collections from Sales||$180,000||$220,000|
|Payments for Plush||$20,000||$30,000|
|Net Operating Cash Flow||$200,000||$250,000|
|Memo: Net Pre-Debt Cash Flow||$200,000||$250,000|
|starting Cash Balance||$310,000||$450,000|
|Net Cash Flow||$200,000||$250,000|
|Closing Cash Balance||$170,000||$220,000|
REVENUE PER YEAR
|PRODUCTS and SERVICES||2016||2017|
OVERHEAD EXPENSES PER YEAR
|Facilities, Rent and Fees||$5,000||$5,000|
|Other relevant Utilities||$2,000||$2,000|
|Advertisement and Promotions||$1,000||$1,000|
|Purchase of equipment||$10,000||$10,000|
|Maintenance and Repairs||$2,000||$2,000|
|Taxes from properties||$2,000||$2,000|
|Licenses coverage plus charges||$5,000||$5,000|
Uses and Sources of Finance for the Plush Company
Jan – $1000
Feb – $1000
Mar – $5000
Apr – $10000
Jun – $15000
Jul – $7000
Aug – $2000
Sep – $4000
Oct – $7000
Nov – $13000
Dec – $5000
Jan – $1000
Feb – $1000
Mar – $5000
Apr – $14000
Jun – $15000
Jul – $7000
Aug – $2000
Sep – $4000
Oct – $16000
Nov – $20000
Dec – $5000
Cash Budget for the Plush Company
Jan – $20000
Feb – $20000
Mar – $20000
Apr – $20000
Jun – $20000
Jul – $20000
Aug – $20000
Sep – $20000
Oct – $20000
Nov – $20000
Dec – $20000
Jan – $25000
Feb – $25000
Mar – $25000
Apr – $25000
Jun – $25000
Jul – $25000
Aug – $25000
Sep – $25000
Oct – $25000
Nov – $25000
Dec – $25000