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Goals for First Year of Business of Advertising Company - Essay Example

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The paper "Goals for First Year of Business of Advertising Company" discusses a company in the UK, that seeks to provide advertising services in the UK to hotels and bed & breakfasts in France.  The company already operates in the United Kingdom market and has been doing so for about one year…
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Goals for First Year of Business of Advertising Company
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Executive Summary Just to Advertise, which is a company in the United Kingdom, seeks to provide advertising services in the UK to hotels and bed & breakfasts in France. The company already operates in the United Kingdom market and has been doing so for about one year. This plan seeks to establish a list of goals for Just to Advertise's first year of business in the new market to be opening in France. The targeted gross sales and other numerical goals are listed in graphs throughout the plan, as well as at the end. This plan has been created on the basis of secondary market research utilizing search engines and existing literature on the topic. All figures in the plan are listed in terms of 100,000 U.S. dollars. Highlights The following graph depicts projected sales for the years 2008 through 2011. As one can see, the sales goals increase slightly with each additional year that passes. The company strives to maintain continued growth and enter the next phase of the organizational life cycle. Objectives Just to Advertise's main objective is to make a fair profit in the advertising industry. This goal is to be reached by attaining the numbers that are reflected in the above chart and in the Financial Plan section. Their secondary objective is to continue to increase profits year after year. They shall achieve this goal through meeting or exceeding their targeted sales forecast. Mission Just to Advertise strives to offer its customers high-quality and cost effective advertising services whenever and wherever they need it. The main clients of Just to Advertise are hotels and bed and breakfasts. The company, however, also services a wide array of small and medium sized businesses throughout the United Kingdom. Currently, the company serves the United Kingdom only and is seeking to branch its services into France. They plan to start serving the French market by appealing their services to hotels and bed and breakfasts that are located in France. Then, they will begin to branch out into servicing other types of small and medium sized businesses. Keys to Success Just to Advertise focuses on two keys to success. The first is Internal Factors, and the second is External Factors. They are both explained in more detail in the subsequent sections. The company believes that these two keys to success must both be present and fully operational in order for them to perform at their maximum level at any given time. Internal Factors Basic internal factors lead the company to believe that it controls its own success. These are: 1. Marketing and Selling Power. The company makes its services attractive in order to attract the widest mix of customers. This approach has proven to be successful for the company's competitors and for the company's United Kingdom operations over the past year. The company plans to continue this practice in the new French market. 2. Overall Excellence in Meeting Promises. Clients purchase benefits rather than features. Both a claim and proof must be presented in order to realize a benefit. This company strives to succeed on every claim. Furthermore, the company believes that failure to do so is severely detrimental to the business. Company management respects the idea that every dissatisfied customer will not only fail to do repeat business with the company, but will also go off and tell a large number of individuals about the poor service that they received from the company. Just to Advertise believes that the customer is always right and that the customer comes first. 3. Generating New Business Leads in Order to Develop Visibility. The company obviously believes strongly in advertising, so they make their name well-known utilizing the vast amount of advertising resources that they have available to them. Developing a strong clientele is very important to the company in order to establish a good reputation in the markets in which they provide services. It is also important that the company builds strategic relationships with other companies and government institutions. Just to Advertise believes that this practice alone will make the company very strong, especially in a marketplace with which it is unfamiliar. 4. Customer Satisfaction and High-Quality Service. The company will guarantee customer satisfaction on every service that they sell. This means that the services absolutely have to meet their needs and do so in an excellent fashion. The long-term survival of the company is dependant on continuous customer satisfaction. As previously mentioned, the company believes that the customer is always right and that the customer always comes first. 5. Strong Management Team. It is critical that the company maintains the best possible management team. Employees must have a strong background in marketing, management, or advertising. The company upholds a strong confidence for its team members. Currently, the United Kingdom office has a total of 23 team members, eight of which are in management positions. They plan to start the office in France with a team of 20 members, five of which will be in management positions External Factors 1. Economic Change. The overall economy is becoming global in nature. Customers now have a new profile and are able to demand value. This is because individuals and companies all over the world simply have more to choose from. If a business wishes to earn the business of an individual or organization, that business simply must accommodate consumer needs. Otherwise, the company is sure to lose a great deal of market share to its competitors. 2. Just to Advertise is committed to building relationships with other companies, government institutions, and customers. This plan is believed to be a critical component of overall company success. Company Summary Just to Advertise is an advertising company located in the United Kingdom. They seek to provide advertising services in the UK to hotels and bed & breakfasts in France. After the initial introductory phase into the French marketplace, the company plans to solicit its services to other types of small and medium sized businesses. The founders of the company are former marketers of similar services on a global scale. There are also several experienced market researchers on the team. The company was founded in 2006 by Bob Smith and his business partners from London. In its earliest days, the business was run from Smith's home office. The company has just recently moved into new retail office space in the downtown area of London. The new branch of the company in France will immediately open into professional office space in the suburban area of Paris. Company Ownership The company is owned by its principal investors and operators. It was created in December 2006. Bob Smith owns a majority of the company, with the following individuals holding equal shares of the remaining portion of the company: Roger Taylor, Pam Wright, Charles Barton, Julio Sanchez, Polly McMurtry, Tony Rogers, Ann Cook, David Ezell, Francesco Fizzle, Gary Morton, Jackie Kritz, Melanie Thompson, Nancy Rodriguez, Opal Zing, Peter Smith, Randy Thompson, Stacy Armstrong, Tony Berg, Valerie Dominguez, and Zach Krick. Company History The company was just started a year ago, so it does not have much of a history. Costs and cash flow are currently well under control by the company's financial department. In 2007, the company met its sales goals, which are shown in the graph below. The graph depicts the company's sales throughout the entire year of 2007, listed on a month-to-month basis. This graph is for the United Kingdom branch of the company's operations. As one can see, the company met or exceeded sales of $70,000 in January, February, March, May, June, July, August, September, October, and December. The company made just under $70,000 in April and November. The company hopes to achieve even higher monthly sales in the French marketplace. Company Locations and Facilities The main office is located in the downtown area of London, England. The new office will be located in the suburbs of Paris, France. The facilities contain state-of-the-art media production equipment, including but not limited to the latest computers, printers, design software, cutting equipment, digital equipment, video equipment, cameras, and essential office supplies. They are equipped not only to directly place advertisements into various forms of media, but also to design advertisements for their customers themselves before actually placing the advertisement. Services Just to Advertise is an advertising firm specializing in the marketing of hotels and beds and breakfasts. The company markets its clients utilizing a variety of different types of media, including print, television, radio, Internet and billboard. For the most part, the company designs the advertisements for its customers before actually placing them. They use the equipment and facilities that were described in the previous section in order to do so. In addition to serving hotels and bed and breakfasts, the company also serves a great deal of small and medium sized businesses in the United Kingdom marketplace. It plans to perform the same services for its French customers, placing their advertisements in the United Kingdom's marketplace in order to appeal to individuals that are planning to travel or vacation to France. Competitive Comparison Direct competitors to the company include other advertising firms in the same markets. The company provides the following as competitive advantage: 1. Better communication than its competitors 2. Access to new and better markets than its competitors can provide 3. Lower costs than those of competitors 4. Value-added services unlike those of competitors 5. Shopping convenience through the Internet, over the phone, or in person 6. Quick turnaround unlike competitors, which usually take weeks to produce results 7. Frequent updating for customer convenience 8. More services provided than by competitors 9. Better prices than those of competitors Sales Literature The company advertises its services through the utilization of a sales brochure, flyers, and direct mailings. In addition, the company is listed in the yellow pages and operates an Internet website that is linked to search engines for easy access by customers. All company sales literature is designed by their own staff members and then published via the most cost-effective advertising methods that the company has available for its utilization. Since the company is an advertising firm itself, it has a lot of advertising tools available at its disposal. The company believes that the advertisements of an advertising firm must be absolutely perfect in order to attract customers. If a brochure is designed poorly, for instance, and a customer sees the bad work, that customer is unlikely to do business with an advertising firm that cannot even produce its own advertisements properly. Technology Just to Advertise maintains the latest technologies related to Windows and Macintosh including: 1. Internet website that allows customers to place orders online wherever they are 2. Able to work with clients via email, including sending drafts back and forth 3. Able to prepare and delivery multimedia presentations on any computer and in any format (disk, live, video) 4. State-of-the-art desktop publishing facilities as described above in the facilities portion of the business plan Market Analysis Summary Just to advertise has a medium-sized range of services that applies to a rather large customer base. The company will focus mainly on hotels and bed and breakfasts since they provide the highest potential for profit considering the services that the company is able to provide and the marketing and advertising expertise of its staff and management. The following sections contain target market information. Market Segmentation The groups of potential customers for Just to Advertise include the following in no particular order: 1. Large Corporations 2. Medium Companies 3. Small Businesses 4. Regional Government Offices 5. Academics 6. Individual Customers 7. Hotels 8. Bed and Breakfasts As previously mentioned, the company plans to market its services mainly to hotels and bed and breakfasts in the French marketplace, just like it currently does in the United Kingdom marketplace. Next in line would be small and medium sized businesses and individual customers. In order to expand even further, the company will then move on to large corporations, regional government offices, and academics and solicit their services to the people at those locations. The following table depicts a market analysis that was conducted in 2001 and was originally used by the founders of the United Kingdom branch in order to plan their operations for that location. This data will also be used in order to forecast the future years for the new location that will be opening in France. Market Analysis Market Analysis 2002 2003 2004 2005 Potential Customers Growth CAGR Large Corporations 11% 56,034,800 62,176,214 68,990,727 76,552,111 10.96% Medium Companies 35% 49,950,000 67,432,500 91,033,875 122,895,731 35.00% Small Businesses 5% 13,125,000 13,781,250 14,470,313 15,193,829 5.00% Regional (Provincial) Governments 2% 1,530,000 1,560,600 1,591,812 1,623,648 2.00% Academics 1% 2,272,500 2,295,225 2,318,177 2,341,359 1.00% Individual Customers 332% 377,580 1,629,333 7,030,898 30,339,731 331.52% Total 24.43% 123,289,880 148,875,122 185,435,802 248,946,409 24.43% The following pie chart depicts the size of the market for each of the potential customers that were listed in the previous section. Market Analysis (Pie) As one can see, the marketplace consists of mainly large corporations, quickly followed by medium companies. These are followed by small businesses, regional governments, academics, and individual customers. The hotels and bed and breakfasts are not included individually in the graphs since they are also considered to be small and medium sized businesses. Target Market Segment Strategy The company plans to focus on its new operations in France, but also plans to focus on small, medium, and some large businesses, as well as individual customers that exist in the global marketplace. The company specializes in hotels and bed and breakfasts, but there is no denying that a huge market exists for large corporations, especially in light of the graphs presented above. It will be, therefore, in the company's best interest to consider growing into that particular area after becoming fully established, operational, and gaining hotel and bed and breakfast clientele in the new French marketplace. Service Business Analysis The following companies are major competitors of Just to Advertise in the new France market: 1. Action Communication 2. Ad Hoc Design 3. Adrexo 4. Alpha Creations 5. B2F Design 6. Canal 55 Communication 7. Comareg 8. Dauphin 9. Delta Diffusion 10. Editions 11. Generation Media 12. Giraudy 13. Havas Voyages 14. Inter Regies 15. JC Decaux 16. Kicible 17. Manifesto 18. Motivaction 19. NR Communication 20. Pagesjuanes 21. Passot Innovation 22. Precom 23. Regicom 24. Societe D'Agences Et De Diffusion 25. Teleperformance Sales Forecast The following graph depicts projected sales for the years 2008 through 2011. As one can see, the sales goals increase slightly with each additional year that passes. The company strives to maintain continued growth and enter the next phase of the organizational life cycle. Milestones The graph above depicts milestones that the United Kingdom branch of the company achieved at the very end of 2006, when it was created, as well as over the course of 2007. The company plans to achieve the same milestones in the new French branch of the business. In November and December, the company accomplished its business plan, stationery, brochures and office equipment. From January to February, the company added advertising via print and the Internet. In April, the company accomplished exports exhibition. In August of that year, the company started trade exhibitions. Finally, in November of 2007, the company accomplished computer technology exhibitions. Break-Even Analysis The following graph depicts the proposed break-even analysis for Just to Advertise. As indicated by the graph, the break-even point occurs where the diagonal line intersects with the horizontal line labeled $0. This occurs at approximately $48,000. Break-Even Analysis Graph The following table includes the specific figures for the break-even analysis as it was depicted in the above graph. It shows monthly revenue break-even at $46,214, average percent variable cost at 20%, and estimated monthly fixed cost at $37,053. Break-Even Table Break-even Analysis Monthly Revenue Break-even $46,214 Assumptions: Average Percent Variable Cost 20% Estimated Monthly Fixed Cost $37,053 Gross Margin Monthly The following graph depicts the gross monthly margin for the United Kingdom branch of Just to Advertise over the entire year of 2007. As one can see, it remained pretty steady around $140,000 for most of the year. Cash The following graph depicts the net cash flow and cash balance for Just to Advertise on a monthly basis for the entire year of 2007. Whereas the net cash flow remained pretty steady, the cash balance progressively increased throughout the year. References Beech, Wendy. (1997). 'Before hanging out your shingleCreate a business plan, it can be your roadmap to success.' Black Enterprise, Vol. 28. Brown, Carolyn N. (1996). 'The do's & don't's of writing a winning business plan.' Black Enterprise, Vol. 26. 'Companies directory.' (2008). Company World. Available from: http://company-world.co.uk/ Wyckham, Robert G. and William C. Wedley. (1990). 'Factors related to venture feasibility analysis and business plan preparation.' Journal of Small Business Management, Vol. 28. Read More
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