Lily City Supermarket - Marketing Mix, Internet Marketing, Management, and Financial Plans - Example

Table of Contents Table of Contents 1 1.0 EXECUTIVE SUMMARY 2 2.0 INTRODUCTION 2 DESCRIPTION OF THE BUSINESS 2 3.0 Marketing of the Supermarket. 4 Marketing mix. 5 Internet Marketing 6 4.0 Supermarket Location. 7 5.0 Management Plan. 8 6.0 Financial Plan 9 Projected graph of Lily City Supermarket. 10 7.0 Critical Risks 10 8.0 Harvest Strategy 13 9.0 Milestone strategy 14 10.0 Appendix 14 REFERENCES 15 BUSINESS PLAN 1.0 EXECUTIVE SUMMARY This is the business plan of the Lily City Supermarket set to be a start up business in Sydney. The business is owned by two directors who wish to inject a lot of resources in establishing a supermarket that will serve the customers. Due to a large number of competitors in the market environment, there is a very great need of embracing a professional business plan that will be a springboard of greater sales and profitability of the supermarket. In realizing growth of the sales and profitability of the supermarket, the business plan will have to address the following key components; business background, the location of the supermarket, the management plan, critical risks anticipated, financial plan, harvest strategy and milestone strategy. The business plan of Lily City Supermarket addresses all these key concerns. 2.0 INTRODUCTION A business plan illustrates a statement of intention. It is prepared as a strategic process of organizing the processes, effort and the organization resources inorder to achieve business growth. This business plan is for LILY CITY SUPERMARET, a new start up business which is set to be opened in Sydney, Australia. It will give a succinct detail of all the processes, explanation and justification of opening a supermarket. DESCRIPTION OF THE BUSINESS The business is going to be known as Lily City Supermarket which will be based in Sydney, Australia. The motto of the business is known as “Your Satisfaction is Our Dream and Desire”. The proposed business will premier at City Mall. The contacts of the business are P.O Box 34211 Sydney, Australia. In the effort to reach the clientele the business has contacted the telecommunication companies with a view of getting telephone numbers. The business is started by two directors; Mr. Peterbell White and Mrs. Lisa White. The business starts with a vision and mission as well as well stated core values that will ensure greater growth and a larger clientele. The business is a sole proprietorship with a view of listing in the stock exchange in the next ten years. The proprietors wish to start the business at the end of June 2012. Supermarket Vision: Become the preferred One Stop Shop for the Customers in Sydney. Supermarket Mission: Serving the customers with Distinction. Core Values: a. Honesty. b. Professionalism. c. Teamwork. d. Unity of Purpose. e. Respect and Dedication to Customer Delight. f. Effective Corporate Governance. Lily City Supermarket is set to use a set of professionals in achieving success. Success in any business organization is pegged and realized through humility, friendliness, accessibility and willingness of the staff to understand the wishes and the needs of the customers. The supermarket objective should be to serve the customers with distinction. In a competitive environment, any start up business like Lily City Supermarket will have to work tirelessly to achieve and cultivate the culture of commitment and passion among the workers. To stay afloat in a competitive environment the system adopted by the company incorporate innovation and market driven products and services that endear the customers to the supermarket. The value added to the customer is based on mutual benefit, equality, opportunity, unity and common understanding. The system of interactivity with the customers ensures that the business set up is given the impetus that drives its sales and profitability (Charlesworth, 2009). Before the start of the supermarket the management and the two directors have to agree on these three most important issues; a. What the aim of the supermarket will be. b. What will be the return of investment? c. A benchmark and strategy of achieving the goals and the mission of the supermarket. The supermarket will sell a collection of household goods including but not limited to; fresh fruits and vegetables, furniture, stationeries, cutlery, clothes and shoes, electronics, foodstuff, books and hardware tools. The Director Mr. Peterbell believes that the business should be founded on ethics and thus the supermarket will not sell alcohol to the members of the public. The supermarket has set up both short term and long-term strategy. The short-term objective of the supermarket is to realise a greater customer base and increase the volume of sale. The long-term strategy of the business is to establish more branches in Sydney and other cities in Australia. 3.0 Marketing of the Supermarket. Being a start up business, nothing will aid the business more than the marketing of the business. As a new entrant, the supermarket will not only need a large volume of resources but also a well-coordinated and organised marketing strategy. The market of a particular business is never saturated, provided a business adopts a marketing strategy that is geared towards attracting more customers, there will always be a market for the supermarket. Effective business and operational planning of the supermarket will without doubt be the platform on which the supermarket generates greater growth of sales and profitability (Brassington & Petitt, 2000). Market research thus remains a critical backbone of Lily City Supermarket. The starting point for the market research is gathering of the information that concerns the business environment and customers in Sydney. The market information will be based on various issues that need to be addressed before starting of the company, these includes the local market trends, the local competitors current systems and processes, the customers tastes and preferences, the market structure and all the relevant statistics that provide the supermarket with a purposeful and pragmatic economic leverage (Beardi, 2000). The best form of obtaining information in trying to aid Lily City Supermarket will be primary research or what is referred as original research. Original research in establishing the local pricing of prospective competitors, the customers buying patterns, trends and individual preferences and all attributes of the local market target in Sydney. The questionnaires, surveys and customer feedback system will be very core in carrying out the primary research. The major marketing strategies will include the following (Jonathan, 2004); Marketing mix. Marketing is very basic for any industry to survive Marketing is the focal point in all business activities. The market in the present economy is very competitive. It’s by ensuring that there is a proper marketing strategy that a company will expand its territory in terms of the market that it controls. The supermarket ought to understand the market that it controls, it needs to understand the needs of the customers, it needs to look for means and ways through which it can maintain and expand its market. Marketing focus on the needs of the consumers, it aims at ensuring that the consumer needs are satisfied. There is need to focus on the advertising of a company’s products (Peter, 2002). Advertising and its promotion has immense benefits to the company and to the consumers. The benefits include increased sells in terms of both volume and value, consumers are made aware of the products that the company offers, stimulates consumer purchase more products, it enables a company to gain competitive advantage. The promotion methods are different depending on the stage of the product that the company sells. The individuals that are usually targeted are the consumers, traders and the sales force. Marketing can be done in relation to advertising, positioning and public relations (Stuart, 2010). Internet Marketing With the growth of technology it is important that all the processes and systems of the supermarket in marketing and accounting to incorporate computerization. The first step would be for the supermarket to establish a website. The website is a very important tool through which any organization manages to interact with the current and prospective customers. A presentable website forms the foundation of successful internet marketing (Sheth et al, 1999). Other modes that the Lily City Supermarket management should major in are marketing strategy in the online media. It would be important to get avenues of social media marketing by joining facebook and twitter. The company has come up with the following e-marketing strategy inorder to better its sales not only the current market but also in the international market. This is seen as an avenue for the success of the company. The e-marketing strategy will include the steps the company will take inorder to market its brand through the web. Still in marketing, the supermarket is set to roll out the low pricing strategy. Every customer will set to buy products where the services are cheaply provided. The mission of the supermarket would only be realized by selling the products at the lowest prices compared to the competitors. It will be imperative for the supermarket to outsource the services of the advertising agencies inorder to come up with the best policies and strategies of marketing that will project the sales and profitability (Charlesworth, 2009). 4.0 Supermarket Location. The supermarket is located in the City Mall a modern mall at the centre of Sydney. This is important location since the market target is the working class of the city. The supermarket is set to benefit a wide clientele by finding a large parking lot for the customers. The preferred location is essentially important since the mall provides ultimate security to the customers as well as their motor vehicles. The location is also very important since the Mall offers other services which may attract the customers as they come to shop for their products in the supermarket. This business is in a strategic place because it lies in an area with good road networks. In general transport and communication channels are in sound state and there is no doubt that this will hasten delivery of goods and services. The presence of high population in the city will also be very important; the herculean task will be to attract a large traffic of customers to the Mall. The presence of good transport networks and proximity to the town will essentially be a plus to the suppliers who may wish to supply the products to the supermarket since they will save their costs. 5.0 Management Plan. Lily City Supermarket will have the following management structure. The management is very important since it’s the bedrock of achieving both the short term and long term objectives. A management structure is very important since most decisions and policies affecting the supermarket will emanate from the supervising management of the supermarket. At the heart of every successful start up business is a sound management (Dibb et al, 2001). There need to be checks and balances as well as systems that control the management of the supermarket. This is the expected structure of the Lily City Supermarket; In establishing a transparent system the Supermarket should come up with a system that ensures that the books of accounts are audited once every financial year. Coming up with the supermarket auditors and bankers provide the first bold step of ensuring a sound system of sound governance and management. The human resource manager is expected to come up with the remuneration structure of all the company employees. Various benefits and attractive remuneration schemes are an essential step in ensuring the success of the supermarket. In doing so it is important to analyse the remuneration schemes of the anticipated competitors. The human resource manager will also establish the qualification, remuneration and duty and roles structure of each and every employee. A transparent system endears both the stakeholders and customers to a start up business. To start the supermarket it’s expected that a total of 25 employees will be required in the initial stages. Licences, permits and by-laws compliance will be obtained before the business commences to operate (Gao et al, 2009). Also sole proprietorship business will hire services like auditing and receive services like insurance, banking and legal services. 6.0 Financial Plan For the supermarket to be effectively run, the management needs to come up with a financing strategy. The capital of the Supermarket is set to be obtained from the Owners Equity of $100000 intended to be ploughed by Mr. Peterbell. The Supermarket is also in the process of obtaining a loan of $50000 from HSBC Bank to finance the starting of the Supermarket. The directors also plan to organize friends fundraiser expected to raise $10000. The total capitalization is thus $160,000. The Supermarket also intends to deal on credit with the suppliers of the products in the meantime. The supermarket however does not intend to give any credit facilities with the customers. To increase the sales the company intends to give the customer a reward card system. The computerization will also be effected to ensure that the sales are effected through the use of debit cards (Gao et al, 2009). A great incentive of the supermarket will be ensuring low pricing, to realise this objective the supermarket ought to deal directly with the manufacturers. Projected graph of Lily City Supermarket. NB: The figures are in $1000 and each quarter represents a period of three months. 7.0 Critical Risks As a new start up business it is important to take into consideration all the risks that may arise at Lily City Supermarket. The first step in curbing risks is for the supermarket to embrace a safety and health policy coupled with taking up an insurance cover to place all the possible risks under consideration. The supermarket is likely to face four major categories o risks; credit risk, liquidity risks, market risks and operational risks (Peter, 2002). The directors and the management framework have a responsibility of identifying and analysing possible risks that may arise in the supermarket. The management should come up with policies that will be a major milestone in limiting and monitoring all form of risks. An important step would be to team up and train all the employees on risk factors, the aim will be geared towards establishing a displined and constructive control environment where the workers know their roles and responsibility. Credit risks arise since most of the supplies are intended to be obtained on credit. If the plan is successful the supermarket will be expected to pay back for the goods obtained on credit. This presents a credit risk issue since goods so sold present a risk factor if they are defective or destroyed. In trying to monitor the effect of this risk the supermarket should come up with a risk grading system that will be core in projecting the sales of the company. The second type of risk is liquidity in nature. This refers to the risk that arises if the supermarket fails to honour its financial obligations. Towards financing the supermarket capital the directors hope to obtain a lone from HSBC Bank. This pose a great risks since a default will attract higher interest rates and penalties to the supermarket. To address this issue the management should come up with a sound accounting and management system that will project the return of investment thereby increasing the level of income which will be very core at payment of the loan. The third kind of risks revolves around the market. Market risks are inevitable for the supermarket. This firstly will involve the level of competition likely to be posed by the well placed chain supermarket. To draw the attention of customers to buy the products will not be an easy task. The market also presents a fluid demand and supply market which will in effect trickle to the management and the sales of the supermarket. Every trading of the supermarket will present a credit issue, however it is the management role to ensure that the market risks are reduced to a great level that does not harm the financial position of the business. The fourth kind of risk will have to do with the operations of the supermarket. The first issue in the running of a supermarket is that unless the management invests in a surveillance system the supermarket may experience the fraudulent wrath of the customers and employees. The embrace of a computerized system requires the management to come up with a monitoring and backup system that ensures that the supermarket is not at risk. Operational risks also involves all those processes that may directly result in the company experiencing losses due to the kind of infrastructure, technology and all other external factors other than credit, market and liquidity risk. One example is the legal and framework requirements. It’s very important that the supermarket comply with the legal and tax framework expected of it by the state. The default may be so harmful to the supermarket operations. To address the issue of risk the company should segregate the duties, establish independent authorisation, reconciliation and monitoring of the transactions, documentation of controls and procedure, develop contingency plans, establish ethical and business standards, training and professional development, compliance with the regulatory and other legal requirements and risk mitigation including effective insurance cover. 8.0 Harvest Strategy This is geared towards establishing that the business remains sustainable in the market. For Lily City Supermarket to remain abreast with the challenges that may face it in the future, it is important that the management comes up with a succession strategy. This is especially important because the directors are family members. A proper framework needs to be put into place to ensure the continuity of the business even upon the demise of the two directors. One of the pillars of accounting is that the business should be a going concern. This means that the operations of the business should be arranged in such a way that the business continue to operate as a profitable enterprise. Under the harvest strategy the management ought to come up with a trust system and fund through which the activities of the supermarket will continue to operate even upon the redundancy of the management and employees. To reduce workers turnover the management ought to come up with a succinct remuneration strategy that ensures that the workers are given some good package at the end of the day. A system that rewards merits rather than ethnicity and nepotism will be very important in instilling the values of hard work among the workers. The employees ought to be given a pension scheme and health insurance inorder to promote their welfare as well as act as an incentive for them to work towards attaining the objective of the supermarket. A reward system would further promote the employees ability to be diligent in attaining the supermarket objective. The best displined and diligent employee ought to be rewarded at the end of each financial year. This will in effect result in better sales and profitability. 9.0 Milestone strategy Just as clearly illustrated in the financial plan of Lily Supermarket there are projected sales and revenues limits that the management has set for the workers. The milestone will be very important in attaining the vision of the supermarket which is to become the preferred One Stop Shop for the Customers in Sydney. The management should ensure that by the end of the month they have obtained the loan from the HSBC bank. The mobilization and presentable stocking by the Mid-June will ensure that the supermarket is set to premier as a great enterprise. Marketing of the supermarket should start immediately. 10.0 Appendix Attached here will be the management resumes of the company. Lily City Supermarket Licences from the local authorities. All the relevant compliance licences should also be attached here. The appendix will also contain a list and contacts of all the partners, bankers, auditors and the advocates that will assist the supermarket in attaining its set objective. REFERENCES Beardi, C. (2000). E-commerce still favours traditional techniques. Advertising Age, 71 (43), 2- 4. Brassington, F. & Petitt, S. (2000). Principles of Marketing (2nd edn). Harlow, UK: Pearson Education. Charlesworth, A. (2009). Internet marketing: a practical approach. Butterworth-Heinemann. Dibb, S., Simkin, S., Pride, W. & Ferrel, O. (2001). Marketing. Concepts and strategies (4rd European edn). New York: Houghton Mifflin. Jonathan M. L. (2004). At the crossroads of marketing communications and the Internet: experiences of UK advertisers. Internet Research, 14(3), 236–244. Peter R. J. (2002).Corporate intelligence and transformational marketing in the age of the Internet. 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