To Start a Personalized Gift Service: iCreate - Business Plan Example

of your Essay Sub Paper Due Table of Contents Executive Summary 3 Introduction 4 Business Aims and Objectives 4 Business Environment 5 Product Description 6 Marketing Mix 6 Product 6 Place 7 Price 7 Promotion 8 People 8 Customer Segmentation 9 Business Financials 10 Sales Forecast 10 Cash Flow Forecast 11 Bibliography 12 Executive Summary This report aims to outline the plan to start a personalized gift service. It outlines the service details including its core USP and business aims i.e. to provide a wide variety of customized gift options to our customers. It also highlights the business environment and competitive landscape to present an accurate representation of the playing field. A marketing mix proposal along with a customer segmentation analysis has been presented to showcase how exactly the service will be marketed and to whom. The report concludes with a financial forecast of sales and cash flows to show when the startup will break even and what the expected revenue projections are. Introduction Icreate is a start-up founded by 4 partners as specified in the partnership deed. It’s a venture based on selling personalized items such as Apple product cases, t-shirts, necklaces, notebooks, backpacks, mugs, and much more. The business model is based on buying materials from suppliers and using private machinery to personalize the object. Icreate will have a brick and mortar store as well as an online presence through its website. Its competitive edge lies in its production process whereby the products will be of superior quality compared to the competitors and will allow for a lot of customization as per the customers specifications. Business Aims and Objectives The aim of the business is to attract customers with a superior quality product combined a customer focused approach to satisfy consumer wants. Icreate aims to truly put customers first where they decide right from the get go what product they want and what kind of customization they want on the product. With such an approach, Icreate aims to expand into new markets and target the upcoming technologically advanced generation with its products. The products are designed to fit seamlessly into the lifestyle of generation X. The business objectives include having a brick and mortar presence in Oxford Street and invest approximately 1,000,000£ into the business. Icreate aims to begin trading in the beginning of December 2015 and therefore the current objective is to acquire the machinery for personalizing the equipment and other miscellaneous items for business launch by the end of November 2015. Business Environment The UK population is set to cross 63.9 million by 2014 which is a good indicator for the giftware market (Key Note, 2010). Child population in the UK is also set to grow which can have an effect on the occasions at which gifts are given and the sort of gift chosen. The credit crunch and the recession has affected consumer purchases and there is a lot more of prioritizing in purchasing behaviors. A survey conducted by the University of Hertfordshire in 2009 showed that the adults surveyed believed in passing on unwanted gifts to others based on economic sense (Key Note, 2010). Gold parties, where individuals sell unwanted jewelry to traders, are also flourishing which further paints an abysmal picture for the giftware industry. However, the growing population and longevity allow for a lot more gift giving occasions that before and Key Note predicts that the giftware market will be worth £5bn by 2014 (Key Note, 2010). There are many trends in the giftware market that are picking up steam and boosting growth of this sector. These trends include ‘Made in the UK’ trend, functional and personalized gifts and creatively innovative gifts (Corner, J, 2014.). The competitive landscape involves numerous online based companies like gettingpersonal.co.uk and buyagift.co.uk. They only focus on selling their goods online and have personalized gifts and other items as part of their product portfolio. The market has a lot of online competitors who boast a product portfolio ranging from corporate gifts to vintage collectables. Product Description Icreate.com specializes in personalized items such as: Apple product cases Bed sheets T-shirts Books, notebook covers and Calendars Personalized Towels Bags, Backpacks and Hats Mugs and key chains Jeweler, scarves, belts, wallets So as you can see the items that can be customized are not restricted to the usual key chains and mugs but range from Stationery items, clothing, tech covers and even bags and backpacks. Since personalizing will be done using equipment that will be owned by Icreate, the possibilities for customization are endless. Instead of giving the customer the illusion of customization by presenting a few options and asking them to select one; Icreate can customize each order down to its details through personalized pictures, words, drawings, symbols etc. The USP therefore lies in the wide variety of choices, quality of the product and the sheer options available for customization. Marketing Mix Product There is a need for different and unique gifts in the giftware industry. The product offers a customized gift and allows customers to send personalized messages where they can be innovatively creative in sending a gift to their loved ones. It is a different gift from the usual items and offers a unique solution. The whole Icreate experience is designed to be customer friendly and truly be a service where the customer creates the gift in a friendly environment and has a wide variety of choices to select from. Its competitive edge therefore lies in its customer friendly experience, wide variety and superior quality of products. Place Icreate will have a physical presence in the form of a store on Oxford Street. It will be a boutique with samples of the various products on display to show the customization options available. Along with that, ready to take home/generic gifts will also be available to cater to those who are in a hurry. Icreate will also have a website where a customer friendly interface will guide the customers as to what exactly are the product categories and how they can customize and order the product. Visual samples of all products and customization options will be provided in detail so the customer can picture the gift in their minds as they build it. The factory location will be a separate business property which will handle all the production processes. Price The recession and the economic downturn has caused a lot of consumers to become very price sensitive however, the economy will pick up and trends in the market show that the under £10 and children’s gifts market is still going strong (CBI, 2012). Therefore prices will be kept low with lesser profit margins initially but the price will depend upon the level of customization the customer wants. To get people to try the service, an initial discount or free customization option can be offered to the first 50 customers for a specific item like a T-shirt. Promotion Promotional activity will involve digital and print platforms. Along with the website, a Facebook page will be set up where most of the promotional activity will be directed. Content about products, sales promotions, discounts and services available can be advertised on Facebook. Facebook Ads can be used to promote posts and reach a larger segment of the market. Google search engine optimization can also improve the reach of Icreate.com and make it more prominent in the organic search results. People Human Resource Plan The upper management of Icreate includes: Director Marketing: Fatima Director production: Natalya Chief Financial Officer: Eahsan Director HR: Monika Director Marketing is mainly responsible for increasing customer awareness and sales, conducting market research and handling the promotions/marketing strategy. Director Production has been entailed with taking care of product and machinery procurement and sourcing raw materials. The Chief Financial Officer will handle the cash flows as well as look over capital raising endeavors with financial institutions. Director HR will be responsible for recruiting and handling the administration of the workforce, forming job descriptions and managing pay scales. The workforce would include 4 technical employees per machine in the production department. The finance team will have 1 accountant to keep record of all transactions and assist the CFO with the financial activities. The marketing department will have 2 employees who will handle the creation of content and advertising for the website and Facebook page. Since Icreate will have a big online presence, an IT department with atleast 4 employees will be necessary. 1 person will be required to handle the website interface and update it regularly, 2 people will be required to handle the order taking mechanisms of the website and 1 person will manage the customer inquiries and complaint center for the website. The store will have 3 employees, 1 manager and 2 sales assistants. 3 people will be a part of the delivery team who will initially handle the deliveries to be made. As the number of orders increases, the delivery team will be expanded as needed. Customer Segmentation The target consumer base is the general population and the marketing will be focused towards those segments of the masses which can afford such gifts. Seasonality and gift-giving occasions will be accounted for and so tourists and ethnic groups can be specifically targeted. The demographics of the customer segment are as follow: Age: Over 16 to 50+ age bracket with emphasis upon generation X( Born in 1965-1967) and generation Y ( Born since 1978) and new millennials Gender: Male and Female Family Size: All Family sizes (emphasis on those with kids) Income bracket: People earning 1000 pounds and above People who are a part of generation Y and the new millennials are more likely to use electronic devices and would hence be interested in iPhone, iPad and computer cases. School and university going students will also be segmented and targeted since Icreate has a whole category of stationery items such as notebook covers and backpacks. So overall, demographically a large market is being targeted but its further segmented based on occupation and psychographic profiles of the generation in question. Business Financials Sales Forecast (a) SALES FORECAST             Months 0 1 2 3 4 5 Units     (a) Sales Value   60,000 60,000 60,000 72,000 2,000 (b) Cost of goods (50% of Sales Value)   30,000 30,000 30,000 36,000 36,000 Cash Flow Forecast Key figures: Start up capital - £100000 Factory set up - £40000 Shop - £30000 Delivery Vehicles - £18000 Website Development - £2000 Raw Materials - £10000 Bibliography CBI, 2012. CBI: UK Economy will pick up. [Online] Available at: http://www.cbi.org.uk/media-centre/press-releases/2012/05/uk-economy-will-pick-up-through-2012/ [Accessed 14 August 2013]. Corner, J., 2014. 2014 Trend Insights: UK Greeting card, stationery and gift markets. [Online] Available at: http://www.springfair.com/files/2014_trend_insight__jeremy_corner.pdf [Accessed 27 Dec 2014]. Key Note, 2010. Key Note: Giftware: Demographic trends will boost giftware market. [Online] Available at: http://www.keynote.co.uk/media-centre/in-the-news/display/giftware%3A-demographic-trends-will-boost-giftware-market/?articleId=454 [Accessed 27 Dec 2014]. Kotler, P. & Keller, K. L., 2012. Marketing Management. 14th ed. s.l.:Pearsons. Read More