High-end Wedding Business Strategies - Assignment Example

?High-end Wedding Business Plan THESIS MENT This paper intends to present a business plan for high-end wedding business which will be operating in Houston, Texas. In order to draw an effective business plan, the wedding industry of the USA has been critically analyzed. The paper also entails three years’ financial forecast for the proposed business. A. BUSINESS DESCRIPTION XYZ Event Planners will provide complete services for wedding, anniversaries and other special events. The proposed business will have an office located at downtown Houston, Texas. The proposed business is unique in terms of meeting the needs of its clients. The proposed business firmly ensures to provide unwavering attention to its clients. The proposed business further focuses on the needs and expectations of the clients and work according to the requirements of the clients so that highest level of customer satisfaction is provided. The services of the proposed business include weddings, honeymoons, receptions, anniversary, wedding hair makeup, special event make up, musicians, entertainers and budget planning. The proposed business aims at providing the best service to each time to the clients of Houston, Texas. The objective of the proposed business is to provide top class services to clients whether it is wedding, anniversary or any other special events in order to make the experience of the clients pleasurable and memorable. Thus, the proposed business is committed towards offering services that are specially tailored according to the needs of respective couples and their families. In order to achieve the broad objectives of the proposed business, special attention will be focused upon the quality and timeliness of the services offered to the clients. The proposed business will thus, ensure that services are promptly and efficiently offered in accordance with the needs and expectations of the clients. In order to ensure that the proposed business objectives are smoothly achieved and the clients are offered with uninterrupted services, the XYZ Event Planners will duly focus on marinating cordial relationship with the all the proposed business partners such as bridal shops, florists, photographers and hair salons among others. i. The Industry Analysis and Perceived Opportunity. The wedding industry in the United States can be recognized as an important industry that has a major impact on almost 100 other industries. The portion of contribution made by the wedding industry to the national economy is constantly increasing. Over the last few decades, the industry has witnessed significant growth in the country. However, the recent economic crisis situation in the US has dramatically influenced the growth rate of the industry. It is expected that the wedding industry in the coming years will again be able to touch new heights with rising revenue. Nonetheless, it is firmly advocated that the proposed business is required to formulate and implement suitable strategies in order to efficiently meet the rising demands of the customers. It has been ascertained that despite the recessionary situation, there has been slight increase in the number of couples getting married. It has been projected that this increasing pattern will continue in the coming years thereby providing significant opportunity for the wedding industry to earn and expand the proposed business. At the same time, it has been observed that the guest attending the wedding has also affected by the recession which has caused a slight reduction in their numbers. However, it is estimated that in the future years the figure shall improve. The spending of couples is also estimated to increase in the coming years. During the year 2011, it had been reported that there was slight positive shift of 1% in the total spending made by the customers in the wedding industry of the USA. At the same time, it has been ascertained that the couples in the recent times are inclined towards planed weddings as well as more couples are observed to prefer outdoor ceremonies rather than indoor ceremonies at churches. It has also been found that couples are currently motivated towards using more resources and this trends in estimated to increase in the upcoming years (The Wedding Report, Inc, and “2011 Wedding Market Insight Report”). It has been further ascertained that Houston ranks among the most expensive wedding destinations with average spending of US$29,129 which is estimated to rise in the coming years (Jaeger, “Wedding Statistics from The Knot”). According to the 2012 Wedding Statistics of Houston, Tx, it has been recognized that during the year 2012, there was 40,430 weddings conducted with average guest visit of around 145-155. These statistics reveal much favorable figures as compared to the overall US wedding industry. The statistical analysis of the wedding growth rate in the region of Texas depicted impressive figures. Accordingly, it has been determined that during the year 1990, the number of couple getting married was 178600 which rose to 196400 in the year 2000. Again, in the year 2009, the number of couples getting married revealed slight fall which was estimated to be 179800. However, this fall in the marriage rate is radically attributed to the crisis witnessed during the particular period across the country. However, according to the estimation made regarding the rate of marriage, it has been projected that the figure will improve in the coming years (United States Census Bureau, “Marriage s and Divorces- Number Rate by State: 1990 to 2009”). Despite the constant fluctuation in the wedding industry, it has been projected that in the later years these figures will show radical upsurge for the proposed business dealing with wedding industry. ii. Legal Form of Business. XYZ Event Planners will take a legal structure of simple proprietorship that would be owned by its founders. It is worth mentioning that as the proposed business continues to grow and expand in its size and operation, it will be registered as a Limited Liability Company or it will take a form of corporation, whichever will be the better option in accordance with the needs of the proposed business. In order to manage and operate the proposed business, simple proprietorship has been selected as this form of legal structure requires fewer formalities. At the same time, this form of business requires lower start-up cost and is generally quite easy to set-up. This form of business structure is subjected to lesser government regulations as well as there are certain tax advantages for it. On the other hand, it has been determined that the proposed business will undertake the legal structure of Limited Liability Company or corporation as it grows in its size and operations. This is because it is quite difficult to manage all the operations of the proposed business alone by the proprietors. As the proposed business grows, the risk of potential loss also increases which can be ascertained to be unrealistic for the proprietors to manage (Krizman, “Corporation or Sole Proprietorship: Choosing a Legal Structure for Your Business”). B. MARKET INFORMATION It has been ascertained that approximately US$35 billion is spent on weddings and receptions every year in the US which makes wedding business an essential commodity in the US market. The people in the US are currently willing to make considerable investment in planning of their weddings. Nonetheless, significant changing trends have been witnessed in the views of people towards marriage. The changing trend does not sound to be thriving for the wedding business in the US. Accordingly, it is identified that struggling economic condition has created damper for the wedding plan in the overall US wedding market. Concurrently, it has been observed that lower percentage of population in the US are opting for marriage while on the other hand greater percentage of population is ascertained to wait for first marriage. It can be identified that the marriage in the context of the US has emerged as an optional choice for the people in the US that can be assumed to be not a good sign for the wedding business in the US. However, good news for the wedding business is that the spending of people willing to get married has been continuously rising. It is realized that if the economy remains stabilized, the spending will further increase in the later years. In this regard, couples are identified to spend nearly 60% of the total wedding expenses while guests attending the wedding are also projected to make considerable investment. As stated earlier, the number of guests attending the wedding in the Houston, Tx is increasing, it would facilitate in ensuring a positive trend in the wedding market. An increase in the number of event facilities and banquet halls is also identified which would be supported by the rise in the number of reception in family and friends homes as well. This projection indeed reveals the positive trend for wedding market. At the same time, together with the increase in the outdoor wedding ceremonies, the apparent growth of indoor wedding ceremonies has also been identified. In addition, online wedding market is also observed to proliferate. Accordingly, the share of online wedding market in the year was estimated to be US$9.4 billion which is estimated to grow at the rate of 3-4% in the coming years. The comparative analysis of the average spending of the US couples for the year 2011 and 2012 is represented below in the tabular format: Source: (Hicken, “Average Wedding Bill in 2012: $28,400”) i. Target Consumer. XYZ Event Planners will offer its services primarily to affluent wedding couples and family members. More specifically, the proposed business will offer services to certain groups of customers who have considerable earning capacity and are well-educated such as lawyers, doctors and business persons. This is owing to the fact that XYZ Event Planners aims to primarily operate as a high end wedding service provider wherein the clients ought to possess high earning capability to afford the services. The proposed business will place itself as one of the leading wedding planning services. The wedding couples are selected as the major target customers as they are extensively involved in the activities to make their wedding life-long memorable. The couples are also ascertained to spend considerable amount on their wedding. Thus, targeting wedding couples as the major customers will provide the proposed business with greater scope to operate its business successfully and profitably. At the same time, family members of wedding couples are placed as the other major target customers as they are quite close to the wedding couples, often they are entrusted with the responsibility to make their wedding experience of bride and groom a unique one. Beside wedding ceremonies, the proposed business will also target corporate personnel. The proposed business will render numerous planning services to corporate personnel for making their corporate event a successful one. Nonetheless, the proposed business will recognize all its clients as an important element for the success of the proposed business and will make considerable effort through proving greater level of satisfaction to them. The proposed business will offer quality and full range of services including weddings, social occasions and corporate events relatively at reasonable cost so that more and more clients are able to experience the services offered by the proposed business. Unlike its competitors such as Envogue Houston, the proposed business will provide its clients with the convenience of one-stop shopping where the clients are able to get everything that they desire to purchase in order to make their wedding pleasurable and memorable. The proposed business will ensure that every guest and individual attending the wedding or the corporate event takes back a unique experience with them that would fascinate them in the years to come. ii. Competitor Strengths/Weaknesses. The wedding service market in Houston, Tx is identified to be fragmented with overwhelming offerings. It has been ascertained that there lies wide categories of hair stylists, caterers and florists in the wedding market of Houston, Tx. A number of companies are identified to be operating in the wedding market of Houston such as Randi Lawrence Moore, Envogue Houston, The Belle of The Ball and Soiree Bliss among others. All these companies are perceived to provide tough competition to XYZ Event Planners. However, the proposed business will probably receive the most considerable competition from Soiree Bliss. It is further expected that many new competitors will enter in the wedding market of Houston, Tx in the coming years as the cost of entry in this industry is relatively lower than other industries. Contextually, Belle of the Ball is observed to offer services such as budget assistance, customized venue, bridal shower planning, rehearsal dinner planning and day-after wedding brunch planning among others (The Belle of The Ball, “Wedding”).Similarly, Randi Lawrence Moore generally offers services such as initial consultation, travel arrangements, wedding day coordination and orchestration and planning among others (Randi Lawrence Moore, “Services”). On the other hand, Envogue Houston offers an array of services including consultation on budget, vendor recommendations & selections and wedding day itinerary. It also coordinates on the wedding day in order to ensure conformity of activities (Envogue Houston, “Services”). Among all the above depicted companies, Soiree Bliss can be recognized as one of the leading wedding planning service providers operating in the wedding market of Houston, Tx. It offers a wide range of activities to both wedding organizers along with corporate event programs (Soireebliss! LLC, “Services”). One of the potential strengths of Soiree Bliss is that the company offers handmade unique decor for its clients, which makes its service special for the customers in Houston. It has been ascertained that all the above mentioned companies offer diverse range of services to customers of Houston, Tx. However, apart from Soiree Bliss, other companies do not seem to be offering complete range of wedding services and corporate event arrangements. In terms of the observed weakness of those competitors, it has been recognized that they do not offer one-stop shopping experience to diverse customers rather these companies recommend clients for selecting vendors wherein clients are required to deal with different vendors on their own which is relatively time consuming for them especially when they have short time to execute their wedding plan. In order to attain competitive advantages over the proactive competitors, XYZ Event Planners will emphasis on the convenience factor of the customers to a large extent. The proposed business will also aggregate a complete range of wedding services under one roof in order to ensure that customers are provided services according to their need in the form of one-stop shop. The owner’s expertise will be leveraged and fully implemented in planning events in order to position and embrace the proposed business with greater competitive advantages. The communication will be placed with greater importance and the proposed business will use both verbal and non-verbal communication to express and explore quality services. The communication will be established with customers with utmost courtesy and empathy in order to ensure that requirements of customers are duly understood. At the same time, careful selection of vendors will be made. XYZ will ensure that all the vendors that are partnered with it are committed towards meeting the needs of diverse customers. More importantly, the proposed business will make no compromise regarding the quality of services and products offered to its customers. C. GENERAL OPERATIONS In order to ensure effective operations of the proposed business, reliable strategies will be formulated and implemented. The strategy of the proposed business will be primarily directed towards meeting the diverse needs and expectations of the customers. The proposed business will ensure that wedding couples and their family are offered with pleasurable and memorable experience. Initially, the proposed business will entail only one owner who will act as the sole proprietorship for the proposed business. The owner of the proposed business plan will be working full-time. As a part of the personnel plan for the proposed business, one expert consultant and event day assistant will be hired who will be responsible for managing and overseeing the wedding activities. It is worth mentioning that these personnel will not be included in the matters related with the management decision. A telephone attendant will be hired who will be responsible for receiving and responding to the calls of customers contacting through telephone. The proposed business will enter into an agreement with different expert vendors such as florist, photographer, videographer, hair and makeup personnel and catering among others in order to render the best service for making the wedding ceremony a memorable one. These vendors will provide the needed materials required for the successful operations of the business. The proposed business will ensure that vendors provide the teams with expertise and experience in their respective field. The experienced production team will work towards making the ceremony unique and pleasurable. At the same time, the proposed business will rent an office at downtown in Huston, Tx. The office will have highly visible electric lights so that it is noticeable from distance. All the operations of the proposed business will be managed from the office located in the downtown Houston. The proposed business will also ensure that a complete range of services is offered to the customers so that they are not required to switch on to other companies or vendors separately. These services will be primarily segregated into three into major categories including wedding services, social occasion and corporate event management. These services or facilities that will be offered by the proposed business will entail full range of planning services, partial planning, event design, event management, engagement parties, destination weddings and dress designers. The proposed business will provide an exceptional design consisting of installation and lighting management. The proposed business will consider each event to be unique and considerable effort will be made in order to make every event unique and exclusive where every individual including bride and groom, family members and guests visiting the wedding can attain pleasurable experience that shall remain fresh in their minds throughout their life. The proposed business will also be committed to offer effective planning for destination wedding in both the locations i.e. national and international locations. It ensures that perfect setting is made for the couple where every guest enjoys the trip for life time. In this regard, the proposed business will also provide attractive planning for newly married couples for their honeymoon. Irrespective of the location where the couples wish to celebrate their honeymoon and the amount of budget they possess, XYZ Event Planners would ensure to provide pleasurable experience. Correspondingly, the proposed business is committed towards delivering enhanced services to all its customers at reasonable costs. The proposed business also provides ultimate services related to corporate events and social occasions. The proposed business will also provide services that would make the memories of marriage proposal last for lifetime. The proposed business makes effort to make the marriage proposal romantic and creative wherein the couples would be overwhelmed with deep emotion. XYZ Event Planners would also offer wedding day coordination in order to schedule wedding smoothly. More precisely, the proposed business would facilitate in guiding the bride and the groom in every step of their wedding so that they can make the best decisions and ensure that every guest attending the wedding ceremony enjoys memorable experience. An online website will be created that would comprise all the relevant information related with the business facilities and services. The customers can enter the websites in order to draw lucid understanding regarding the various services offered by the proposed business. This online portal will also include all the travel updates and wedding contracts. The website will be designed and decorated in such way that would carry a strong message to the customers regarding the quality of services offered by the proposed business. In order to spread awareness about XYZ Event Planners amid people in Houston, a variety of promotional tools will be used comprising social media and print media. The greater significance will be provided to the interior of the office design so that customers visiting the office are able to get an inclination of the quality of services offered by the proposed business. In this regard, the interior of the office will be well-furnished and walls of the office will also be decorated with attractive paintings. As a marketing tool, a manual will be printed that would entail information regarding the wide range of services offered by the proposed business. During the initial stage of the business commencement, discount will be provided to the customers as well as the prices of the services and products will be kept reasonable in order to attract customers towards the services and products of the proposed business. Efforts will be made in order to build a strong brand image in the wedding industry of this region. More importantly, the proposed business will make its best effort towards winning the heart of its customers with its exclusive and unique services. D. FINANCIAL INFORMATION The owner of the proposed business will be responsible for managing and handling all the activities related with the start-up of the proposed business in order to ensure maximum success of the business. The owner will also be liable for arranging all the requirements necessary for commencing the proposed business. Initially, the owner of XYZ Event Planners will be liable to deal with all the debts and profits arising from the operations of the business. After conducting the market analysis, it has been estimated that in order to commence the proposed business, the start-up cost of US$5000 comprising legal cost, advertising and promotional cost will be required. An additional of US$5000 will be maintained as a bank deposit in order to meet any contingency expenses and as operating capital for the first three months from the actual start-up of the proposed business. The funding will be partially derived from friends and relatives, owner himself and in the form of loan. Correspondingly, owner will contribute US$6000 while rest of the amount i.e. US$4000 will be obtained from friends and relatives along with US$10000 from a leading bank. The owner will incur 10% interest on the loan obtained from a leading bank. No interest shall be provided on borrowings made from friends and relatives. Start-Up Capital Requirement. Sales Forecast for XYZ Event Planners. It is projected that the sales revenue from the proposed business will mainly be derived by two sources. The primary source of sales revenue will be the clients, i.e. either the bride and groom or their family members. The secondary source of sales revenue will be obtained through commissions from the business partners. To be noted, the customers or clients will have an advantage to pay the entire cost in two instances, i.e. 70% when the order is placed as a cash/cheque payment and 30% after the final delivery of service. It is expected that this financial payment facility to obtain credit sales in the initial year will increase customer satisfaction and lure them to promote the business through their word-of-mouth networking channels. According to the sales forecast for the three consecutive years, it has been estimated that the share of revenue will initially remain low. Since the proposed business will be operating in collaboration with the vendors. The direct cost of sales will be incurred in terms of transportation costs and labor costs, as well as cost of promotional items for the business such as leaflets, brochures, office space costs and others. As the business matures, the sales revenue from the proposed business is estimated to grow. Projection based planning, as exhibited in the following chart, thus depicts that the initial year orders will be around 5 weddings @US$ 25,000. Gradually, the cost for sales will increase by 2.5% in the consecutive years where the total number of wedding contracts is also expected to increase to 7 at least and later in 2015, the business is expected to organize around 12 weddings maintaining its percentage increase in the charged sales price. Forecasted Profit & Loss for XYZ Event Planners. It has been ascertained from the forecasted profit and loss statement that during the first year of the business commencement, the proposed business will be able to earn negligible profit of US$6,910. However, in the next two years, after the commencement of the business, profits will start to soar. Correspondingly, at the end of the third year, the net profit of the company is forecasted to reach US$129,250. The 10% depreciation will be charged on the office equipments including furniture and other equipments such as computer on a straight-line method. Additionally, the business will also pay tax on the income made by the business annually at 10%. At the same time, extensive cost will be incurred on advertisement and promotional purposes in the first year. However, as the business matures, the expenses related with marketing and promotion activities will be gradually reduced. Works Cited “Services.” Envogue Houston. n.d. Web. 30 Nov. 2013. Hicken, Melanie. Average Wedding Bill in 2012: $28,400. 2013. Web. 30 Nov. 2013. Jaeger, Chris. Wedding Statistics from the Knot. n.d. Web. 30 Nov. 2013. Krizman, Robert. Corporation or Sole Proprietorship: Choosing a Legal Structure for Your Business. 2009. Web. 30 Nov. 2013. “Services.” Randi Lawrence Moore. n.d. Web. 30 Nov. 2013. “Services.” Soireebliss! LLC. n.d. Web. 30 Nov. 2013. “2011 Wedding Market Insight Report.” The Wedding Report, Inc. 2010. Web. 30 Nov. 2013. “Wedding.” The Belle of the Ball. n.d. Web. 30 Nov. 2013. “Marriage s and Divorces- Number Rate by State: 1990 to 2009.” United States Census Bureau. 2012. Web. 30 Nov. 2013. Read More