Iphone Sample Swot Analysis - PowerPoint

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					IN
       One's
     element
         Agenda
•   Mission Statement
•   Financial feasibility
•   Proposed store location
•   Footprint
•   Store and internet operations
•   Product mix
•   Visual merchandising
•   Conclusion
•   Questions
                                IN ONE’S ELEMENT
     Meet Team IOE International
Molly McKenna
University of Michigan                           Jocelyn Sousa
   Stephen M. Ross                               Florida State University
   School of Business                            Junior, Merchandising
Junior, Marketing                                Store & Internet Operations
Merchandise Planning


        Sarah Ackerman                                           Jesse Nkemka
        University of Wisconsin                                  Georgia Southern
        Senior, Retailing and Material Culture                   Senior, Finance
        Real Estate                                              Finance


Sean Garza                                        Brittany McLaughlin
University of Arizona                             University of Florida
Senior, IDS, Business                             Senior, Family , Youth & Community
Administration, Communications &                  Sciences
Spanish                                           Recruitment & Training
Visual Merchandising


                                                 IN ONE’S ELEMENT
       Mission Statement

In One’s Element International’s mission is to
help college students and apartment dwellers
in China create their own “element” by
choosing from a variety of woods, fabrics, and
metals to customize our furniture offerings.
IOE International helps customers maximize
their living space by providing multi-functional
furniture and storage solutions.

                             IN ONE’S ELEMENT
               Finance
               Potential Rewards in China

China offers great potential and substantial rewards and revenue

Great Opportunity for retailers

    Market size is expected to increase from $232 million in 2006 to an estimated

      $7.7 billion in 2025

    Retail sales are increasing annually by 15%

    IKEA has had tremendous success!

Fast-Rising Rate of Middle Class (expected to be 25% by 2010)

Mostly cash transactions due to China being a “cash society,” (high liquidity)


                                     IN ONE’S ELEMENT
              Finance
              Potential Rewards in Hangzhou


The Chinese willingly pay 30 to 40% more for luxury items than what is charged in
  the United States (i.e. Wood Products)
Luxury Market is growing 50 to 60% per year and represents 12% of the world
  demand for luxury goods
76.7% of the population in Hangzhou is considered the market target giving it the
  rating of the best business city in China!
University students comprise a major share of the Hangzhou consumer market
                                  Bedroom
   Great source of revenue due to their need of apartment furniture




                                    IN ONE’S ELEMENT
             Finance
             Potential Rewards in Hangzhou

Displayed below are two graphs showing the rising Retail Sales and Growth Rate
as well as the rising Per Capita Disposable Income and the rising Per Capita
Consumption Expenditure




                                  IN ONE’S ELEMENT
              Finance
              Manufacturing in Guangzhou



Manufacturing capital of China
Best-rated city for Manufacturing in China Easy
  access to major ports in Hong Kong
Items can be easily and inexpensively shipped to
 numerous cities when IOE International expands
Labor costs are much lower in Guangzhou in relation
                                 Bedroom
  to the rest of China




                                   IN ONE’S ELEMENT
              Finance
              SWOT Analysis

              Strengths                               Weaknesses
         Great store location                New Company In New Country
         Unique product line                     Cultural Difference
         Low production costs                    Language Barriers
                                                Different Business Model
                                                  Different Currency
            Opportunities                                Threats
      EXCELLENT BUYER’S MARKET             May Not Be Able To Export Revenue
       Steadily Rising Market Size                Tough Competition:
 Steady increase of Chinese middle class                 Home Depot
 Increase of demand for wood products                        B&Q
Fast-Growing Home Improvement Market       Integration of Chinese and Western
                                                       Business Models


                                    IN ONE’S ELEMENT
                  Finance
                  Land Costs


Cost of land:             $11,935,800

Land Improvements:        $80,000

Taxes on Land:

     3% Deed Tax:         $358,074

     1% Processing Fee:   $119,358

     0.1% Stamp Duty:     $11,935.80

          Total Taxes:                  $489,367.80


                                        IN ONE’S ELEMENT
             Finance
             Construction Costs

Cost of Building:          $948,150 (15,000 sq. ft. at $63.21 per sq. ft.)

Cost of Resets (Annual):   $10,000

Land Renovations:          $27,539




                            IN ONE’S ELEMENT
        Finance
        Total Start-Up Costs


                   Start-Up Costs
Land                           $11,935,800.00
Construction                   $975,689.00
Taxes                          $489,367.80
Land Improvements              $80,000.00


Total                          $13,480,856.80

                         IN ONE’S ELEMENT
             Finance
             Labor Costs




Production Labor (Annual):            $241,920.00

Transportation Labor (Annual):        $129,024.00

Recruitment/Training (Annual):        $64,512.00

Store Employees (Annual):             $88,704.00

    Total Labor Costs (Annual):                     $524,160.00


                                   IN ONE’S ELEMENT
               Finance
               Labor Costs

Labor Costs Compared to that of the United States (Annually)
                             Hangzhou, China           United States

Production Labor             $241,920                  $2,174,400

Transportation Labor         $129,024                  $1,159,680

Recruitment/Training Labor   $64,512                   $579,840

Store Employees              $88,704                   $797,280

        Total Labor Costs                $524,160.00                   $4,711,200


                                       IN ONE’S ELEMENT
              Finance
              Potential Risks
High Risks
   Total Project Failure
   NO ROI (Return On Investment)
   Unpredictable Rising Labor Costs in China

Low Risks
   Low or Slow ROI (Return On Investment)
   Not Able to Transfer Money Out of China
   Unpredictable Rising Labor Costs in China
       (Costs are still considerably lower when compared to the United
          States)


                                  IN ONE’S ELEMENT
              Finance
              Local Partnership Ventures

These ventures can provide a stable and secure means of expediting money to
  the United States
It can also help to decrease expenses by allowing the partnering company to
  conduct certain business aspects and roles
Most Partnership Ventures offer several Venture Models and Services
There are four common services that are provided
    1. Manufacturing
    2. Procurement
    3. Marketing
    4. Investments


                                   IN ONE’S ELEMENT
                 Finance
                 Chinafacturing Solutions




Chinafacturing Solutions could potentially be a beneficial partner of IOE
 International
Under their manufacturing service, they offer three Business Models
    1. Contract Manufacturing
    2. Manufacturing Services
    3. WOFEs and JVs


                                    IN ONE’S ELEMENT
                Finance
                Chinafacturing Solutions

The Business Model that would benefit IOE International the most would be the
Joint Venture Model. It offers:

Complete business control in determining Production Cycles and can react
 quickly changing conditions
Complete business control in Change Management; Engineering and
 Manufacturing can be swiftly implemented
Complete business control in Quality, Enhancing Yield, and Customer
 Satisfaction
Complete business control in Intellectual Property and Know-How retaining
Improved profitability in retaining the manufacturing margins usually paid to a
 Contract Manufacturer
                                    IN ONE’S ELEMENT
                    Finance
                    First-Year Numbers

                                                       Year One

Total Revenue                            $956,248.29

Total Assets                             $14,307,608.00

Total Expenses                           $2,008,176.00

Total Liabilities                        $13,480,856.80




                    Net Income                              -$225,176.51




                                  IN ONE’S ELEMENT
                       Finance
                       Potential Profit

                      Year One          Year Two        Year Three        Year Four        Year Five

Total Revenue       $956,248.29      $1,758,694.5633   $2,435,876.52    $2,824,846.14    $3,452,328.75


Total Assets        $14,307,608.00   $14,307,608.00    $14,985,234.00   $15,548,368.00   $16,843,428.00


Total Expenses      $2,008,176.00    $2,024,846.43     $2,047,467.21    $2,055,453.87    $2,071,359.08


Total Liabilities   $13,480,856.80   $12,956,243.00    $12,124,548.00   $10,842,328.00   $9,248,985.00




Net Income          -$225,176.51     $1,085,213.13     $3,249,095.31    $5,475,522.27    $8,975,322.67



                                               IN ONE’S ELEMENT
        Real Estate
        Projected Retail Store Location: Hangzhou
• Population: 6.72 million
• 112 miles from
  Shanghai
• No. 1: “China’s Best
  Midland Commercial
  City Rankings”1
• Not so overpopulated
   – Beijing
   – Shanghai


                        IN ONE’S ELEMENT
          Real Estate
          Projected Retail Store Location: Hangzhou
                                 • Advantageous traffic
                                   flow
                                 • Prosperous surrounding
                                   businesses




 Hangzhou Peace International
Conference & Exhibition Center




                             IN ONE’S ELEMENT
         Real Estate
         Downtown


                                Zhejiang
  Residents                     University
already going
 downtown                       Parks

                                Cinema

                                Temples


                    IN ONE’S ELEMENT
       Real Estate
       Projected Manufacturing Locations
• Guangzhou, China       • United States
  – Glass                   – Wood
  – Metal
  – Iron




                     IN ONE’S ELEMENT
         Real Estate
         Penetrating into China: Considerations
• Representative Office
• Joint Venture or
  Consultant
   – Sino-Foreign
     Cooperative
• Assess the
  government’s stability
• Visas/Work Permits



                          IN ONE’S ELEMENT
Real Estate
Projected Building Specs


                 Sq. Ft. Structured Like Walgreens
                 Size (Sq. Location Type     Shape
                 Ft.)
                 ~10,000 Corner Lot          Square
                 -14,000




                                           Basic Layout

              IN ONE’S ELEMENT
                    Store and Internet Operations
                    Demographics
Demographics: China (2009)                          Demographics: Hangzhou (2007)
    Population                1.34 billion            Population     7.86 million
                                                     •Permanent Residents       •6.72 million
     Median Age               total: 34 years        •Non-Permanent             •1.14 million
Population Growth Rate           0.655%              Residents
  Total Fertility Rate   1.79 children born/woman
                                                    Gross Domestic Product    Rmb 478 billion
   •Ethnic Groups:                                          (GDP)
    •Han Chinese                  91.5%                 Age: 0-14 years           13.02%
       •Other                      8.5%                Age:15-64 years            76.17%
                                                        Age: 65 + years           10.81%
                                                    Population Growth Rate         3.36%

                                                      Population by Sex:
                                                      •Female-                    •50.78%
                                                      •Male-                      •49.22%
                                                         Languages           *Standard Chinese or
                                                                                  Mandarin
                                                                               *7 other dialects


                                                IN ONE’S ELEMENT
        Store and Internet Operations
        Target Market




Who we are targeting:
 College Students
     Parents
  Working Adults


                        IN ONE’S ELEMENT
Store and Internet Operations
Consumers

      Main force of consumers in
              Hangzhou:
       Private Enterprise Operators
           White collar workers
          Corporate Executives
           Government Officials
           University Students
                 Parents
     Relatives of the consumers above




                 IN ONE’S ELEMENT
Store and Internet Operations
Consumers




            IN ONE’S ELEMENT
               Store and Internet Operations
               Marketing
 Marketing Techniques we will
 use:
     •Television (Most Effective)
                •Radio
            •Newspapers
       •Phones ( iphone app)

Marketing Techniques we will branch out to
                 in the future:
         •Postal Services (Catalogues)
                     •Emails
                •Magazine Ads
*initiate mailing list once we gain awareness


                                    IN ONE’S ELEMENT
               Store and Internet Operations
               LCD Touch Screens
                                           We will have LCD Touch Screens in
                                        every room for buyers to customize and
                                                 order their furniture


                                             Tea Lounge
                                                           Kitchen
                                          Living Room

                                                           Deck/Balcony


Sales Associates will assist each
 customer with their purchase            Bedroom          Bathroom
and guide them as the use these
       high-tech devices

                                    IN ONE’S ELEMENT
Customize your own furniture using
         5 simple steps:
                  1. Function

                 2. Price Range

                    3.Room


                   4.Product


              5. Material and Color



               IN ONE’S ELEMENT
            Store and Internet Operations
            Website
                                 Our website will have English to Chinese
                                 Translation and live chat with online
                                 sales associates in both languages.




Internet Host : DataPipe
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 professionals to provide managed
 hosting, security, and professional
    services around the world.             How may we assist you today?

                                       IN ONE’S ELEMENT
                         www.ioeinternational.com

              Store and Internet Operations
              IOE International
                  Home            About Us          Delivery   Assistance   Contact Us

 Function
                                                                   Material
Price Range

  Room
                                                                    Color
 Product

 Material
  Color
                 Children’s Furniture




                                        IN ONE’S ELEMENT
Store and Internet Operations
Services
   Packaging and Delivery

        Option A:    Option B:
         Pick up      Pick up
       Unassembled   Assembled


        Option C:    Option D:
         Deliver       Deliver
       Unassembled   Assembled

              IN ONE’S ELEMENT
Store and Internet Operations
Tea Lounge




       In One’s Element will incorporate its
      very own tea lounge to create a more
     relaxing environment for our shoppers
      and to target our Chinese consumers.
        We will offer Hangzhou’s legendary
      Longjing tea and a number other teas
                      as well.




                  IN ONE’S ELEMENT
Merchandise Planning
                        Meeting
                        needs of
                       apartment
                        dwellers


                                               Multi-
Customization                               functional
                                             furniture




        Westernized                Storage and
        design style               organization



                                     IN ONE’S ELEMENT
      Create YOUR element in 5 steps




Function   Price   Room     Product   Material




                          IN ONE’S ELEMENT
What function needs to be filled?
            Storage

            Leisure

             Rest

           Education

            Decor



                       IN ONE’S ELEMENT
           Create YOUR element in 5 steps




Function      Price     Room     Product   Material




                               IN ONE’S ELEMENT
 What is your price range?

Under $50          $50-150
         $150-300
$300-500          Over $500



                   IN ONE’S ELEMENT
           Create YOUR element in 5 steps




Function     Price   Room      Product   Material




                            IN ONE’S ELEMENT
 What room are you shopping for?

Bedroom           Kitchen
       Living Room
Bathroom            Deck



                  IN ONE’S ELEMENT
           Create YOUR element in 5 steps




Function     Price   Room   Product   Material




                            IN ONE’S ELEMENT
        Which product meets storage needs?

• Product Sample:
  – Modular bookshelf with
    storage containers
• Benefits
  – Choose number of
    modules and
  – configuration
  – Use containers in or out of
    bookshelf

                                  IN ONE’S ELEMENT
        Which product meets leisure needs?

• Product Sample:
  – Mahjong table and chairs
• Benefits
  – Use as dining table when
    cover is on
  – Storage drawers maximize
    space usage


                               IN ONE’S ELEMENT
       Which product meets rest needs?

• Product Sample:
  – Murphy Bed
• Benefits
  – Style and practical
    use of
    space




                          IN ONE’S ELEMENT
      Which product meets education needs?

• Product Sample:
  – Desk Table
• Benefits
  – Plenty of space to study
    and do work
  – Top folds out to reveal
    storage unit


                               IN ONE’S ELEMENT
       Which product meets decor needs?

• Product Sample:
  – Chalkboard Lamp
• Benefits
  – Decorative lighting
  – Built in calculator and
    space for writing notes
    and memos


                              IN ONE’S ELEMENT
           Create YOUR element in 5 steps




Function     Price   Room   Product   Material




                            IN ONE’S ELEMENT
        Which material do you like best?
 Wood             Metal                 Fabric



Black Cherry   Brushed Steel                  Stripe
                               Floral




 Red Cherry    Dark Textured       Jacquard




                               IN ONE’S ELEMENT
Visual Merchandising




        IN ONE’S ELEMENT
       Visual Merchandising

                     Tea Lounge
                                     Kitchen

                Living Room
• Store Map
                                    Deck/Balcony




               Bedroom            Bathroom




               IN ONE’S ELEMENT
         Visual Merchandising

 Each color/department
  represents one of the 5
 elements which make up
        one’s home

                             Store offers easy
                             access & navigation


                     IN ONE’S ELEMENT
       Visual Merchandising


• In-Store displays will have an “At Home” feel
  and ambience
• Displays will strictly correspond to their
  department/element/color.
• Targeted so the customer can identify and
  imagine the display as their own home


                     IN ONE’S ELEMENT
Visual Merchandising
Display Examples


Bedroom                    Bathroom




                   IN ONE’S ELEMENT
  Visual Merchandising
  Display Examples


Deck/Balcony                  Kitchen




                     IN ONE’S ELEMENT
  Visual Merchandising
  Display Example / Tea Lounge Layout

Living Room                  Tea Lounge




                 IN ONE’S ELEMENT
                Recruitment and Training
                                         • Two managers from the United
• Staff                                    States for the first two years
   –   Store manager (Red)               • Bilingual in English and Chinese
   –   Department manger (Blue)
   –   Two assistant managers (Yellow)
   –   Logistics manager (Black)
   –   Sales associates (White)




                                IN ONE’S ELEMENT
         Recruitment and Training

• Use a head-hunter for top management
• Use online job hunting sites
• Go to the many university career fairs




                    IN ONE’S ELEMENT
         Recruitment and Training

• Why choose our company
  – High paying
  – Fast paced
  – Challenging
  – Flexible hours
  – Housing for a year
  – 20% employee discount
  – Paid vacation days


                    IN ONE’S ELEMENT
          Recruitment and Training


                  Video



Selling     Benefits    Culture      Product


                   IN ONE’S ELEMENT
         Recruitment and Training

• A full day for in store training
• Learning how to use the consumer friendly
  computers
• Learn how to use the consumer friendly LCD
  monitors




                    IN ONE’S ELEMENT
      Recruitment and Training
      Training Methods

•Continually train the
managers to fully run the
store
•Recruited college
                            Train      Promote


students trained for the
management positions
                            Recruit     Train

•Recruit continuously

                    IN ONE’S ELEMENT
       IOE International
       Recap of Plan
• Located in Hangzhou,      • 5 Elements &
  China                       Customization
• Target Market             • Engaging LCD Screens
   – Students               • Online Sales Associate
   – Parents
   – Working Adults
• Multi-functional
  Furniture



                         IN ONE’S ELEMENT
                   IOE International
                   Thank You Sponsors and Mentors



  Kelvin Peyton            Rick Sotomayer
Sr. Real Estate Manager   Planner, Better Updated                                 Janis Healy
          Macy                     Petites           Susan Grafton           AVP, Visual Merchandising
                                   Macys            VP, Controller & Chief   Orchard Supply Hardware
                                                     Accounting Officer
                                                          Best Buy



     Teresa Orth            IOE International would like to thank
  VP, Human Resources      our Mentors for taking the time out of
        Toy R Us          their busy schedules to provide us with
                                                                                  Angela Knapp
                                    valuable information.                          SVP, New Media
                                WE APPRECIATE YOU ALL!!                             Estee Lauder




                                                IN ONE’S ELEMENT
IOE International
Thank You Sponsors and Mentors


               We would like to make a
                special thanks to Ann
             Langston for all of her time,
             dedication, and hard work!
              You were a great help Ann
             and we couldn’t have done
                   it without you!



               IN ONE’S ELEMENT
     IOE International
     Thank You Sponsors and Mentors




IOE International would also like
 to thank American Express and
 the National Retail Federation.

                    IN ONE’S ELEMENT
Questions?




         IN ONE’S ELEMENT

				
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