Development of LivePlan Detergent Company - Case Study Example

BUSINESS PROPOSAL By (Name) Course: Tutor: University: City and State: Date: Detergent Manufacturing Business Proposal Project Structure LivePlan detergent Company had designed a new product that is aimed to provide managers with an affordable, easy and quick method to effectively monitor the hand washing. The new detergent is predicted to be the most effective preventive measure ever manufactured in the company to combat diseases. Improper hand washing contributes to a lot of deaths in United Kingdom every year and most of them come from communicable disease transferred from restaurants, hospitals and day cares. The project has followed some researches done that have shown how improper hand washing increases the spread of d8seases and how proper hand washing methods can bring health in an environment and cut down disease spread by 80%. The main contributing factor to the problem is the failure of supervisors to control and monitor the habits of employees. The Company has realized that existing detergents offers no affordable or effective solutions for ensuring and enforcing the process. When the costs of disease treatment was estimate it UK this year, it was found that people spent over $90 billion in direct costs annually. LivePlan Company is the first company that provides answers to the problem and gives undisputable proof that the detergent will work. The detergent will go through several clinical tests to ensure that it works effectively every time someone uses it. No other product in the Australians will have high assurance level of sanitation amenability. The detergent is very safe and meets all the regulation of Australian sanitation and hygiene (Tung, R. 2006, 44). Despite the fact that hospitals and restaurants have ahigh market and need for the detergent, day care offers the best opportunity for initial target for the product. The reason why daycares are the ideal markers for the product is that they offer the best opportunity and are highly vested in reducing the transfer of diseases amongst children and have obdurate support from the parents of these children to create a clean environment (Snyder & Burns, B. 2010, 64). Another reason why day cares are a prominent target market is that they are sophisticated factories for germswhich originate from sharing toys and shakinghands thus transferring viruses and bacteria. Sometimes children carry with them nasty bugs to those day care centers,which they can infect the rest of the children. The company Founded on comprehensive financial predictions, LivePlan will need $300,000 in start-up capital, but will produce optimistic cash flow in Year, 1 October. The company expects that by the end of year 3, it will have generated sells worth $900,000 in sales and with sizeable net profit. The Company offers stakeholders a company with extensiveprogressprospective, mitigated by revenue producingconstancy. The Company mission is to continue satisfying customers by ensuring that their products and services are aimed at improving their health and preventing germs which cause illness. The projects is aimed at the following objectives; to develop a finish prototype which meets regulator standards, achieve $7 million by end of year 5 and become the special detergent of choice for hospitals, hotels and day cares in Australia by end of year 5 (Raulerson, Malraison & Leboyer, A. 2009, 105).  Estimated Cost The total funding needed to get the detergent business started is projected at $ 300,000. The executive management team (the CEO and the managing director) is required to invest $ 110,000 and $80,000 respectively. Additionally, a $80,000 investment is essential in order to ensure product development and effectively the Company`s products to a primarily limited geographic region required from other investments. The key start-up plan elements for the Company are, working prototype development, patent approval gaining, funding of requirements for working capital and other material needed for promotion for the main operating activities of the company and establishing a strong image for the brand early to aid in positioning the product in the market (Mckeever, M. 2005, 24).  The product founders have managed to develop aproduct prototype roughly. The start-up period for the product includes 5 months of work by a chemist who has been independently- contracted by the management in the nearby local lab who will work on perfecting the design into a final prototype, with the correct detergent dyes and correct balance. The final two months of the start-up period entail safety tests as per regulations from the government in order to assure high quality. The companymanagement team will initially use a residential apartment in Australia to run the operation and can move to a rental in the next two years. The distribution of the product will remain outsourced. Timelines Start-up requirements Start-up expense Brochures $4,000 legal $16,000 Stationery $150 Rent $0 Insurance $600 Consultants $1,500 Development of a website $500 Expensed equipment $150 Research Development $150,000 Other $1,000 TOTAL START-UP EXPENSES $ 173,900 Start-up assets Cash required $75,100 Start-up inventory $ 50,000 Long-term Assets $0 Other current Assets $0 TOTAL ASSETS $125,100 Start-up funding Start-up expenses for funding $ 124,000 Start-up Assets to fund $128,000 TOTAL FUNDING NEEDED $252,000 Assets Additional cash raised $0 Cash requirement from stat-up $77,000 Non-cash assets from start-up $52,000 Starting date cash balance $77,600 TOTAL ASSETS $206,600 Capital and Liabilities Liabilities Long-term liabilities $0 Outstanding Bills $0 Current Bills $0 Interest-free (other current liabilities) $0 TOTAL LIABILITIES $0 Capital Planned Investments CEO $110,000 Managing Director $80,000 Other investors $80,000 Additional investment requirement $0 TOTAL INVESTMENT REQUIRED $270,000 Involvement in the team I am part of the management team whereby we believe in our experience. The team in which am in is very strong and has experienced board of advisors who re taking part in the development of the product. I am the primary advisor and have succeeded in bringing fifteen years of networked relationship and industry experience to enhance product growth and penetrate it in the competitive market. As the primary advisor, I have to initiate the team so as to first focus on getting the target market in the Australian markets by the use of existing distributing channels and direct sales so as to facilitate product penetration in the market.; I have to ensure that initial capital is used to patent, producetest, market and improve LivePlan as well as offers a working capital for the first year of the product operation. As part of the managing team, I would have to work hard with the rest of the group in order to ensure that three strategies formulated to achieve desired growth. They include, continuing to develop new products to satisfy an ever growing market set, to exploit the advantage which is fast moving in highly segmented market with a differentiated and a unique product and to improve brand campaign for awareness raising, positive product perception and product sales within the company`s target market. Benefit of the product and service The company’s new product is unique and is going to be used in the control of infectious transmittablediseases. The product is intended for two market lines; the day cares and hospitals and restaurants. The detergent for day care will be named as DayCareassure, the one intended for hospital will be named as Hospitalassure and for restaurants will be referred to as Health-foodassure. The benefit is going to be of a competitive advantage for the company as once it penetrates in the market, the profits are absolutely going to be high (Kahn, K. 2006, 45).  The detergent will facilitate hand washing for all people especially the children. It is intended to protect child care institutions from germ problems and illnesses that can be directly reduced through hand washing for both workers and children. With the new government rules that all childcare, hospitals and restaurants should have hand washing detergents, the new detergent is going to be the prominent product for that case. Following parents interest to reduce illnesses in children, they are going to purchase the product once it comes to the market to ensure that the child environment is safe (Kumar, D. 2010, 88).  In hospitals it will be used by doctors and nurses to wash their hands before and after handling hospital equipment and the patients. In restaurants, it will be provided for both the staff and the customers to use before and after handling food. This will help in preventing food borne disease and also avoid food poisoning (Newfarmer, Shaw & Walkenhorst, P. 2009, 91).  Market Growth and Strategy The quest for child day care services will continue to rise at an alarming rate. As the labor force participation of women from the age of 16 to 44, preschool parents and school age children are expected to arrange for day care for their children. The continued quest for money makes theses parents to work during evenings, late nights or even on weekends and thus the demand will grow significantly for day care programs for children that can offer care during non-traditional hours (Belbin, Meredith M. 2004, 9). The key element of the Company initial strategy is to ensure that they sell their new detergent in Australia day care institutions, hospitals and restaurants. The executive teams is focused on building loyalty for the company products with managers making key decisions of the Company concerning the target market by creating awareness and supporting each and every benefit of the innovative product (Garcia, R. 2014,12).  Competitive advantage of the new product Successful branding is the first advantage that the product has over its competitors. The Company is planning for excellent distribution and proprietary positioning which will help in developing the brand recognition beyond any competitor. The company is aware of anychallenges that it might encounter and therefore, it is fully set to overcome them in order to continue leading in the market. The new product is predicted to make quick penetration in the market and rest assured that the product will provide protection degree beyond what is referred to as first-mover advantage by creating entry barriers in the market (Abrams, R. 2007, 121).  The main competitors are the common soap manufacturers in Australia. Traditional detergent producers employ the manufacture of products with pleasant smells that attract customers and offer protective dyes to encourage the process. However there is no way that means to verify if any handwashing has been much anticipated using these sop other than their scents. Some of the soap manufacturing companies are currently working to gain a market position (Porter, M. 2005, 18).  Some large companies achieve consistent sales and have enjoyed a strong market share in the commercial market. Other alternative handwashingsystems aregoing to offer competition to this new detergent. However, once LivePlan detergent is released, people are going to easily adapt to it as it would be more effective than these otheralternative hand was methods (Debelak& Debelak, D. 2005, 78).  Management team The two main strengths for the company are flexible personnel needs and low cost structure. The company has employed sales people with experience who are going to reach the target markets soon as the product is out. However it will be essential for the company to hire new sake team to expand into each market segment. References Abrams, R. M., 2007. The successful business plan: secrets & strategies, Palto Alto, Calif; Planning Shop. Belbin, R Meredith Meredith., 2004. Management Teams, Routledge. Debelak, D., & Debelak, D., 2005. Bringing your product to market-- in less than a year: fast-track approaches to cashing in on your great idea, Hoboken, N.J: John Wiley & Sons.  Garcia, R., 2014. Creating and marketing new products and services, New York: Free Press. Kahn, K. B., 2006. New product forecasting an applied approach, Armonk, N.Y: M.E. Sharpe, Inc. Kumar, D., 2010. Enterprise Growth Strategy Vision, Planning and Execution, Farnham: Ashgate Pub. Mckeever, M. P., 2005. How to write a business plan, Berkeley, CA: Nolo.  Newfarmer, R. S., Shaw, W., & Walkenhorst, P., 2009. Breaking into new markets emerging lessons for export diversification, Washington, D.C: World Bank.  Porter, M. E., 2005. Competitive advantage: creating and sustaining superior performance, New York: Free Press. Raulerson, P., Malraison, J.-C., & Leboyer, A., 2009. Building routes to customers proven strategies for profitable growth, New York: Springer.  Snyder, T. U., & Burns, B., 2010. Selling in a new market space getting customers to buy your innovative and disruptive products, New York: McGraw-Hill Professional Tung, R. L., 2006. Learning from world class companies, London: Thomson Learning. Read More