Yacht Transporting Company Market Analysis - Essay Example

PART BUSINESS PLAN OBJECTIVE/MISSION The main objective of this business is to provide a smooth and an efficient way of transporting private yachts globally to 8 destinations sailing through the Mediterranean and Caribbean Sea. Mission of our company is to provide a devoted service to the sailors who are unable to reach world’s most attractive cruising areas. We intend to provide our customers, with the best of our assets and on schedule delivery. MARKET ANALYSIS Recently yacht transporting companies have shown tremendous improvement. Companies have been innovative and have found methods of efficient and smooth delivery. It’s either by driving through trucks or by sailing in the huge vessels; they have hence figured out efficient and unique ways to deliver products. The market for yachts transportation is a niche market with a division of 25% volume by smaller boats/yachts which are less than 80ft and 30% for the super yacht which is estimated to be greater than 80 ft. Market Segment The main segment that our company renders services to includes the private yacht owners, yacht builders, brokers and the charter companies looking out for expansion. ‘In 2005-2008, boats became a status symbol. In 2009-2010, they became a part of the market that has been lost’ (Mallet Victor, Demand for more sustainable boats and equipment grows).However the current recession has paced down the business but the demand has not died. Companies are expanding their business offering delivery to new destinations with guaranteed security of yachts. BUSINESS DESCRIPTION Business Structure: Our Company maintains the equilibrium between responsibility and team work. It possesses a linear structure where staff is involved in both decision making and other responsibilities. Services: Aim of the business is to transport private yachts from ports in Northern Europe and the Mediterranean to the ports of Caribbean and vice versa. Customers will be able to book their yachts transporting order online. The destinations we work at, include the glorious Palma (Mallorca), Olbia (Italy), Toulan (France), ST.Thomas (US Virgin Islands), free ports Bahamas and Martinique in the Caribbean. These places are known as the magnet for cruising yachts because they are the most brilliant coasts on earth with a passive atmosphere and beautiful surroundings. In most parts of the Mediterranean, the sailing season extends from the end of March to November. And the season at Caribbean lasts from November till June. Thus the schedule follow up shows that yachts will be carried from Europe to Caribbean in the autumn months and from Caribbean to Europe in the spring months of each year. Company possesses four vessels. However the yachts are mainly carried by the semi submersible flo-flo vessel along with the charter vessel in the lift off lift on market to meet the specific demands of our customers. The charter vessels are to be used on demand and in future company expects to sign in a partnership with the charter vessel owners as an assurance for its routine usage and maintenance Risks and Expenses: The four ships that the company owns are worth 150 million GBP which is equivalent to 600 million. The basic expenses I expect to encounter are for the advertisements, maintenance, taxes, harbor fee, insurance, fuel, staff salaries and utilities. Operational Risk: We recognize as a fact that any unfortunate accident or damage to the yachts may undermine the profits. In order to reduce the risk company covers all insurances and liabilities. Weather Risk: Bad weather is a natural barrier to our work. However as a solution to this we have hired delivery skippers who will be responsible for the security and transportation of the yachts safely to the desired destinations irrespective of the weather warrants. FINANCIAL ASSUMPTIONS: Company’s goal for the next five year is to operate as a full service yacht transporting business. YEARS 2010 2011 2012 2013 PLAN MONTHS 1 2 3 4 REVENUE XXXX XXXX XXX XXX INTRESTS XXX XXX XXX XXX UTILITIES & SALARIES XXX XXX XXX XXX MAINTAINANCE XXX XXX XXX XXX TAXES XXX XXX XXX XXX VESSEL CHARGES XXX XXX XXX XXX INSURANCE XXX XXX XXX XXX ADVERTISEMENTS XXX XXX XXX XXX SKIPPERS XXX XXX XXX XXX NET INCOME XXX XXX XXX XXX MANAGEMENT STRUCTURE: Our Company has an efficient staff. We have 8 captains, 4 helpers, 4 skippers and others for administration purposes. We have a courteous, helpful and enthusiastic team that works together as one with the intention of coming up with the best service to satisfy our customers STRATEGIES AND IMPLEMENTATION Quality Service: We provide our customers with on schedule delivery, a service they can rely on. Competitive rates: For a new company like us it’s important to enter the market with economical rates. However we offer our customers’ reasonable prices and a 10% deduction in the fee for late delivery. Yachts security: We ensure our customers that no damage would occur to the yachts by maintaining their security and insurance. Market Strategy: As a beginner we need to create awareness of our services and company in the market. In order to this, an exceptional promotional campaign will be required. We plan to advertise in magazines radios and via internet, the most clicked medium. Along with it we intend to provide our reliable customers with complementary goods like the t-shirts, frames, mugs and pens as souvenirs. This will be done to maintain good will relations with them, Sales Strategy: Initially the company would base its sales strategy on customers to see how satisfied they are. However later on, the company plans to enter the market of new builds transportation from building yards to destinations required by the brokers or buyers. These were few strategies we have intended to adopt for our business. Our main focus is our service through which we aim to attract and sustain our customers. We hope the business works and prosper as planned and expected. We comprehend our customers mind and therefore provide them with the opportunity to enjoy their holidays sailing at beautiful locations on their private yachts. List of References Mallet, Victor. (2010) ‘Out of the doldrums’. ‘Financial Times’ [online]. Available from http://www.scribd.com/doc/39241679/FT-Yachting-Report [22 September 2010] PART 2: Reflective Essay As a group I believe we have produced the best of what we could produce; My part was to manage and explain the business concept. A business concept basically conveys the product/service one offers, and explains where and why the business would have an edge over other competitors. The quality assurance, the on time delivery and security of the yachts at reasonable prices were the three basic things that would be offered to the customers. It’s a concise market where service quality and pricing strategy are the two key factors that differentiate the product/service. Market segmentation was broken down into market analysis part where we described the target market and how it stands with private owners, brokers and builders. Lastly an analysis of how the business would have a competitive edge over others was added in the strategies and implementation part of the plan. However in my opinion we could only attract customers by the strategies. I understand the fact that in a business plan we describe the future of our business. In this case it was to give a proposal for the business that was about to come in existence. The main agenda of the plan has to give to the point description about the business and to invite potential investors and employees. However our group report was able to fair well in explaining the objective of the business that was to render quality service to the customers while assuring them security of their yachts and on time delivery. Market analysis is important aspect of the plan as it gives n outlook of the industry company is going to work in and describes how well it could fit in (Sample Plan). I personally wanted a one-on-one interaction with people who are already into this business. This would have helped me get insight and facts from people who have been in this business for years. For instance, yacht path which has been in business for last nine years or dock wise yacht transport which has been providing the same service since 1987 and is still leading in the market. This would have given us an insight into the inner stories of the current market and a better look at analyzing the growth of market in near future. The market segment was obviously very brief for the service the company offers. I insisted on gathering information about major customers among the private owners who would like to enjoy their holidays on yachts at beautiful locations, brokers and builders of yachts for expansion or delivering the yachts to their customers at different places. In this way we would have correlated our strategies accordingly. But the majority of the member base thought that this would be irrelevant. Where the business description is concerned, I felt it was important to mention about how the senior administrators of the company assign a leader to the company’s troop. We did a fair job by giving the numbers of captains and staff that were working with us. However I believed that naming and briefly describing them, their credentials and background would have added to the reputation of the company. Our Next job was to define our services. We researched on this and found that almost all the transporting companies offer the same destinations and our job was to dictate in a manner so that people would feel attracted and dependable on the company for its valuable yachts rather than trusting others. I realize the fact that trust was the key factor through which we could have manipulated the minds of our customers but according to me we were quite simple and unexcited. It was important to mention the number of yachts a single vessel could carry with respect to its size so that the viewer has a rough idea of the sizes of the vessels. It would have also assured them that we are making the best use of our resources. The important aspects of the plan were the risks, expenses and financial structure. Risks of this company were very obvious and it was an extra effort to introduce the skipper as assistance in bad weather assuring the customers that we care and are responsible for our duties. However I thought that we restricted ourselves in defining the expenses. For the investors the information should be transparent and updated so that they can decide their future dealings in the best way possible. A numeric estimation of these expenses could have been given to give a rough idea of the business’ cash outflow. The expected break even analysis and the gross profits should have been demonstrated. As an example it could have been presented in the following way: Break-even Analysis: A Pro Profit and loss and Cash Flow give details to the investors to judge the progress and aim of the company. PRO PROFIT AND LOSS: Sales XXXX Direct Cost of Sales XXXX Other XXX Total Cost of Sales XXXX XXXX Gross Margin XXXX Gross Margin % XX% Expenses XXX Payroll XXX Sales and Marketing and Other Expenses XXX Depreciation XXX Fuel & Maintenance XXX Utilities XXX Insurance XXX Payroll Taxes XXX Other XXX Total Operating Expenses XXX Profit Before Interest and Taxes XXXX Such tabulation including a proper balance sheet and assumed business ratios with SIC code 4499xx (New Jersey Chamber of Commerce), would have improved the presentation and also conveyed the required information about the business to its clients. Financial assumption was proposed as a substitute when I insisted on defining expenses in greater detail. Though the figures were not given, members of my group believe that enough information was given to make the estimates. Per yacht charges according to the size and extra tax fee description was likely to be visible in a yacht transporting company’s business plan. “A strategy delineates a territory in which a company seeks to be unique.” (Porter, Michael) It is totally based on what we were to introduce as our strategy and gear up for its implementation. The basic strategy to enforce was the trust factor and to assure the customers that they will receive the best quality service the way they like it. Apart from this, there were the sales and marketing strategies. According to a theory the performance of a business in market in directly proportional to the assets and craft that company owns (Entrepreneur 2001). Therefore it is important to know the strengths of the company as well as the competitors so that one can propose marketing strategies accordingly. In my opinion we were moderate to a certain extent in describing the marketing strategy. It’s the main key component that describes how the company is to attract customers. We gave a list of mediums through which we intended to advertise like radio, magazines and internet. We were precise about the motivator tools that we were to adopt to attract customers with our service. I put forward a suggestion to distribute the pamphlets of our company at yacht seller’s shops as well because that is a direct entrée to customer’s minds. According to me we should have put in more details in our business plan, about the positioning of the product along with the pricing strategy company adopted to pull customers. Product/service differentiation was the important aspect of this strategy; we could have defined our differentiating quality to set aside our services in the eye of our customers. Pricing strategy could have been more transparent here as at it was an important factor for product differentiation. We could have revealed the prices and benefits like discounts or incentives we wish to give to our reliable customers. Further in the section of marketing strategy SWOT analysis was necessary I believe. It is important that the company convey its strengths to the investors taking it as an opportunity to realize that they are investing right. Should be well aware of its weak areas but have a strategy designed to cope up with those. SWOT analysis of the company is a brief form of business plan. Then again, there were no details about the license or permit issuance to the company to transport. It was important to mention the license, that the company requires and also to introduce its legal department. Insurances of the employees their security packages could have been added to invite the potential employees to be a part of the company. Training policies and benefits would have enhanced the motivational factor for the company. Location details were missing from the plan. It is important to mention the location business has chosen to nest at. Geographical location with important factors like the security cost of land, an urban area where the company is easily accessible. Online booking was given as a solution to this proposal but still in my opinion it’s important to reveal the address of the office so that people can access when required nationally or globally. Lastly the milestones we want to achieve, and our goals that we have set to motivate our company to work enthusiastically, give an ambitious picture of the company. The main agenda of the plan was to build a proposal of a business that has to come in existence, to provide appropriate information to the entrepreneurs who are interested in investing in it, attract chief employees and to understand the vision of the business future with a better all rounded perspective. As a group we were able to produce a variety of ideas blended as one. However it always had some space for improvisation. I discussed how I viewed this plan and ways to make it transparent and accessible for the potential viewers. LIST OF REFRENCES Entrepreneur (2001) [online] Available from [accessed 2 March, 2001] New Jersey Chamber of Commerce Standard Industrial Classification Codes [online] Available from Read More