LED Advertising Truck in Australia - Challenge of Technology-Based Marketing Platform - Business Plan Example

The Business Plan Name: Course: Tutor: Institution: Date: Executive Summary The proposed venture is a service delivery organization offering marketing and advertising services for organizations in the Australian market through LED advertising trucks. In this case, the venture will be in the digital marketing industry sector and will mainly focus on marketing brands in social events and CSR sponsored social gatherings and meetings through the displayed advertisements of the LED advertisement trucks around the respective venues. With its limited liability company status, the proposed venture with headquarters in Melbourne will overcome competition especially forecasted from the social media. The proposed venture is estimated to cost $ 2million as a start-up capital and is expected to break even within three years of operation. It is expected that with increased CSR funded social meetings, the idea will be sustainable and viable across the Australian and global markets at large. Table of Contents Executive Summary 2 Table of Contents 3 1.0 The Service Description 5 2.0 The Sector 5 3.0 Management 6 3.1 The Vice President 6 3.2 The Marketing Manager 6 3.3 The Human Resource Manager 7 4.0 Legal Status 7 5.0 PEST Analysis 8 5.1 Political Analysis 8 5.2 Economic Analysis 8 5.3 Social Analysis 8 5.4 Technology Analysis 8 6.0 The Market 9 6.1 Target Market 9 6.2 Competitors 9 7.0 Operational Details 9 8.0 Financial Analysis 10 9.0 SWOT Analysis 11 9.1 Strength Analysis 11 9.2 Weakness Analysis 11 9.3 Opportunities Analysis 11 9.4 Threats Analysis 11 10.0 Conclusion 12 References 13 Appendices 14 Appendix 1: Cashflow Forecasts 14 1.0 The Service Description The product to be developed will be a mobile LED advertising track business. In this case, the organization will apply the modern technology as a means of revolutionizing the marketing industry. In this case, it seeks to offer a balance between the traditional mainstream advertising and marketing platforms to the new social and digital based advertising platforms. The proposed business has its SPU on the mobility and flexibility of the advertising process. In this case, unlike the traditional advertising platforms such as banners, billboards and TV were fixed in their customer base reachability. Therefore, the proposed product will provide the required flexibility by allowing for the reaching out of the customers at their locations, areas of work and social events as the trucks will be on constant moves as they run the advertisements on their LED enabled display-boards. Therefore, the proposed product will provide an additional mobility merit unavailable in the current advertising platforms. The proposed business product on LED truck advertising will mainly focus and target venturing in social events. In his case, the trucks will be available for hire to promote and raise awareness of their events, as well as during the events. As such, they will mainly focus on marketing products in main events where mobility is a key to creating products and business awareness. 2.0 The Sector The key sector of focus in the study is the digital marketing industry sector. Ryan and Jones (2012, p.258) classified the sector as a changing industry in the global market platform. In this regard, the industry has been categorized with a growing trend where there is a rising demand for digital marketing platforms to replace the traditional marketing platforms. In this case, an evaluation of the industry illustrates that the industry is currently at its growth stage, with an increasing number of technology reliance by the young generation. In this case, the fact that a majority of the young generation as reversing to the use of technology as a base for information search in their buying decision-making process. As such, the rising trend of social development and the need for organization to associate their marketing and corporate social responsibility creates a huge market gap in the industries. In this case, the trend for increased support and sponsorship of social events creates the need to adopt a marketing platform.As such, the sponsoring organizations can incorporate their CSR with advertising by hiring mobile trucks to circle the venues creating awareness of the brand sponsorship, as well as product features and functionality. 3.0 Management In order to guarantee the proposed venture management success and market sustainability, the organization has developed a strong and competent team of 4 management executives involved in the direct management of its operations. I will personally head the organization as its executive director. This is based on my skills in management and marketing skills that will serve as a critical base on which the organizational marketing and business operational models will be executed. In addition, the other three executive managers will be as follows: 3.1 The Vice President In charge of the daily organization, operations, and the administrative functions. The holder will be experienced personnel in business leadership for over two years. Will be in charge of all the other managers and reporting directly to the CEO 3.2 The Marketing Manager In charge of organizational marketing and trucks management Relating with organizational clients Will be selected based on a bachelor degree in marketing and a minimum one-year experience. 3.3 The Human Resource Manager In charge of recruiting, managing and retaining the organizational employees Will ensure alignment of the organizational needs and development goal The manager will be selected based on an academic degree in marketing and a minimum one-year experience. Although the small and new management group is likely to pose a management challenge, it will be overcome through team building exercises for the executive management. 4.0 Legal Status The proposed venture will be a public limited Company. In this case, the organization will have an independent entity status from the owners with the legal right to own property and be liable for business credit and liabilities. Other alternatives to the business ownership model were a partnership, but it was ruled out based on the challenges of partnership dissolution due to partnership disagreements. Moreover, the evaluation established that the venture will have additional merits as a limited liability Company. On one hand, the venture will have a perpetual life, allowing for the going concern in business application as the death of any of the owners will not affect its existence. Moreover, it will acquire an additional finance base, with the high possibility of bank organizational lenders. As such, this will ensure the acquisition of a high capital base for the organization, operational expenses, as well as growth strategic plan funding. Finally, an additional merit for the selected limited liability form of business is on the security offered to the owners, in that in the event that the business fails to meet its liabilities, the owners’ individual assets cannot be attached to cover the business debts. 5.0 PEST Analysis 5.1 Political Analysis A political analysis of the Australian market establishes a stable political base. In this case, this implies that the existing political stability ad goodwill will promote the development of a viable business venture in the LED truck advertising market segment. 5.2 Economic Analysis An economic analysis establishes that with it being the least affected economies by the 2008 global financial crisis in the developed world countries, the Australian economy has been on the rise. As such, this has promoted an increased number of the middle-class social statuses, creating a larger market base for the proposed business venture for the upcoming numerous organizations. 5.3 Social Analysis The Australian society, social status is changing with a developing economy. In this case, the rise of a new middle class has increased the drive and participates in social events, thus making the proposed venture a viable approach by organizations to target this new consumer base platform 5.4 Technology Analysis Finally, an evaluation of technology illustrates that the industry has increased rates of technology literacy. As such, the cost of IT infrastructure is bound to be reduced, allowing for a reduction in the proposed venture operational costs, a virtual likely to increase its profit margins in the long run period. 6.0 The Market 6.1 Target Market The proposed venture will have a double client base, namely the advertising organizations as well as the targeted consumers in the Australian market. On one hand, the organization will target advertising companies that are focused on sponsoring social events for the community well being as a CSR approach. In this case, it will provide them with a revolutionary avenue through which to integrate their CSR programs with marketing through advertising on the mobile trucks, rotating around the venues. On the other hand, the organization will target the middle class in the Australian society that is especially involved in social events. As such, it will seek to deliver quality and accurate product advertising to this consumer group. 6.2 Competitors A key competitive base for the organizational proposed business venture on marketing is the social media. In his case, the social platforms such as Facebook, Myspace among other individual free hosting blog sites are likely to offer a marketing platform for the organizations targeting the young generation (Kotler, Suvit and Jain, 2002, p.207). As such, in order to counter the challenge, the organizational model will deliver an added value proposition as it will gainfully target even the aging customer base that may be reluctant to join and trust information offered on such social media platforms. 7.0 Operational Details The proposed Led truck advertising business will be based and headquartered in Melbourne in Australia. In this regard, the location selected is based on the availability of the venture supplies that is a majority of the large and medium size organizations that have their hub in the City. Therefore, this will allow for access ease to transact with the potential organizational supplies that form part of its client base. In addition, due to the high cost of purchasing the required large number of trucks, the location will allow for the ease of availability of trucks for hires when need be. In this case, the organization will purchase 10 LED advertising trucks and provide for the renting and purchasing of additional 20 as and when the demand and the need for the services arise. Moreover, as a temporary office location, the organization will lease office space for three year's duration, after which it expects to establish its platform. Nevertheless, the proposed business model and operational needs pose a significant challenge on the risk of high operational costs prior to acquiring a sufficient consumer and client base. As such, as a means of demonstrating the model applicability the organization will for the first two weeks of operation use its trucks to market its services and source for clients. 8.0 Financial Analysis The organizational forecasted cash flow statement for the next three years is attached under Appendix 1. In developing the cash flow analysis, this business plan adopts several assumptions. On one hand, the business plan assumes that all the forecasted risks in the business will be managed as anticipated and, therefore, no unexpected occurrences. On the other hand, it is based on the assumption that the current inflation rates will remain static, and all the values are calculated in the future value approach. However, the process faces the risk that in the event that there are high, inflation rates, the future value of the earnings will be less than their actual present analysis and thus risking low-profit rates for the venture. In summary, the forecasts illustrate that although the venture has high outflows in the start-up period, it increases its inflows towards the second and third years respectively. 9.0 SWOT Analysis 9.1 Strength Analysis Among the proposed venture’s strengths include the mobility of the advertising trucks. In this case, the trucks can move around Australia as and when events are organized. Therefore, this will serve as a tool to increase the organizational consumer base diversity in the market. In addition, the venture has strength in the low costs of operations that will increase its profit margins. 9.2 Weakness Analysis Among the pertinent proposed venture weaknesses, is the cost of fuel for the trucks the use of trucks will require regular refueling, likely to raise its costs above other digital platforms. In order to mitigate this weakness, the proposed venture will seek to enhance operational efficiency through trucks display maximization. This will be by providing other services such as equipments ferrying in the venues as the displays do not interfere with the internal capacity and space. 9.3 Opportunities Analysis The proposed venture has its opportunities in the growing application of CSR sponsored events. In this case, the need for organizations to integrate CSR into marketing and display their products in such sponsored social events creates a sustainable, viable business opportunity. 9.4 Threats Analysis Despite its opportunities, the proposed venture faces an operational threat in the face of internet and social media based competition that has a lower marketing cost base. However, the proposed venture is expected to mitigate his future threat due to its target customer base diversity from the young to the old alike, unlike the social media that focus on the young generation consumer base. 10.0 Conclusion In summary, this business plan establishes that although the proposed LED advertising truck business is viable and sustainable in the Australian market, it faces the challenge of technology-based marketing platform and a new management structure. As such, the plan established that with its diversity focus and team building practices, the proposed venture is bound to be a success. References Kotler, P., Suvit, M., & Jain, D. C., 2002, Marketing moves: A new approach to profits, growth, and renewal, Harvard Business School Press, Boston, Mass. Ryan, D., & Jones, C., 2012, Understanding digital marketing: Marketing strategies for engaging the digital generation, Kogan Page, Philadelphia, PA Appendices Appendix 1: Cashflow Forecasts Lead Truck Advertisers Company Cash Flow Statement For the Year Ending 12/31/2015 12/31/2016 12/31/2017 Cash at Beginning of Year $100,000 250,700 547,700       Operations       Cash receipts from customers     800,000 900000 950,000 Cash paid for     Inventory purchases (230,000) -201000 203,000 General operating and administrative expenses (100,000) -80,000 -70,000 Wage expenses (125,000) -100,000 -120,000 Interest (11,500) -8000 -8300 Income taxes (32,800) -40,000 -42,000 Net Cash Flow from Operations 300,700 471000 912,700     [42] Investing Activities       Cash receipts from     Sale of investment securities 30,000 41,000 43,000 Cash paid for     Purchase of property and equipment (100,000) -105,000 -107,000 Net Cash Flow from Investing Activities (70,000) -64000 -64000   Financing Activities       Repayment of loans (20,000) -30,000 -35,000 Dividends (60,000) -80,000 -120,000 Net Cash Flow from Financing Activities (80,000) -110000 -155000       Net Increase in Cash 150,700 297000 693,700     Cash at End of Year 250,700 547,700 1,241,400 Read More