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					Bwlch Tocyn Farmhouse Bwlch Tocyn Abersoch Gwynedd LL53 7BN
01758 712245 01758 712014
cdsconsultants@btinternet.com

6th of January 2006

TABLE OF CONTENTS 1. Executive summary 2. Business Description The Company Products Positioning Pricing 3. The Market Customer Market size and trends Competition Estimated sales 4. Development Development Status Cost of development Labour requirements Expenses and capital requirements 5. Sales and Marketing Sales and Marketing strategy Distribution Advertising and Promotion 6. Management Management team 7. Finance Risks Profitability

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PART 1 – EXECUTIVE SUMMARY

Through our own internal research we have found a niche for marine products, specifically boats. This has been developed through a set of boat builders in Egypt. We are going to be marketing at private buyers, industrial markets and agents all over the world. We have in particular found that there is sufficient demand in Australia and New Zealand which we intend to explore methodologically. This is very much a new product range for CDS Consultants and we have collaborated with two colleagues whom we have known for many years. The product is very much in it‟s infancy but we already have a fully operational website with other marketing to follow soon. The main reason for entering this market is because we believe we can in essence build a boat a faster, quote a boat cheaper and make the customer happier. Egypt can build boats much cheaper than a lot of other areas in the world because of cheap labour and lower price of raw materials. The beauty of this is that we quality is not compromised and the customer is basically getting the same boat, with a branded engine at a much cheaper price. Strong organisational and marketing skills will guide this product and achieve unparallel success. PART 2 – BUSINESS DESCRIPTION CDS Consultants were established in 1985 with the initial objective of providing a consultancy to companies to meet their shot blasting needs. Over the last few years we have sustained our core product but have also branched out into new markets, predominantly on an international scale to fulfil the businesses potential and to take advantage of opportunities. There is huge demand (source) for the products we sell with varying demand but particularly prosperous in the Middle East. We have the knowledge and the experience to exploit the market needs moving in our favour. Our corporate vision is simple to maximise sales through a high quality customer service base and high quality products. Fundamentally this opportunity is viable as with the demand with exists on both a domestic and foreign markets will create larger revenues than we currently have. One of our Key areas of development is Marine, in particular boats consisting of Luxury Yachts, fishing boats, Catamaran‟s and containers. An overview of the industry As we are unique in our portfolio, the outlook for these products and their potential is extremely lucrative. With advances in technology the quality of the equipment available has saved time for companies on using the equipment we sell as it works in a more efficient and effective manner. Many manufacturing sectors within the UK have suffered in recent years which have been one of the driving forces behind CDS growing our export base. The costs involved in the creation and building of boats can be extremely expensive due to high labour and material costs, having a well thought out logistics in Egypt will keep overheads low as the internet is our main source of distribution to our target audience.

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This is most certainly been advantageous for our company as the level of competition is dictated by an organisations ability to compete both on price and more importantly quality. Also as we are not manufacturing our portfolio we have had choice in whom our suppliers are in choosing the „best fit‟ boats for our target audience. Being able to broaden into new markets which were previously not viable is a key component and part of the decision making process in diversifying into Boats. The Boston Consulting Group Box (BCG Matrix)

STARS Turbines / Boats

QUESTION MARKS Foodstuffs

CASH COWS Shot Blasting

DOGS Manufactured goods in the UK

Dogs - Has low market shares and low market growth rates. Question Marks - Has low market share but operate in high market growth rates. We could put a lot of resources in this product in the hope that it will eventually increase market share and generate cash returns in the future. Star - Has high market shares that operate in growing markets. The product at this stage should be generating positive returns for the company. Cash Cow – Mature stage of the Product lifecycle, it generate high amounts of cash for the company, but growth rate is slowing. The product may slip into decline due to environmental restrictions and lack of investment in this country. According to research in the United States of America the market for outboard motorpowered boats is highly fragmented, with some segments encountering flat or declining demand and several other product segments exhibiting growth. Interestingly some types of private boats were down 10%, but center console and “walk around” fishing boats, often used on larger bodies of water and on the ocean, were up as much as one-third.

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The strong stock market, following on the heels of the 1993 repeal of the 10% tax Furthermore, jet boats and personal watercraft have attracted many new boaters. The industry remains positive that increased sales of jet boats and personal watercraft will eventually lead to future sales of all boat products, despite the fact that the relatively low retail prices of these craft have lowered the annual dollar volume of sales. This illustrates that it is not enough to have a good price, it is the supplementary services which accompany the core product which also maintain customer loyalty of word of mouth advertising among the target audience.

The Flower of Service: Eight Groups of Supplementary Services
Information Payment Billing Exceptions
KEY:

Consultation
Core

Order-Taking Hospitality

Facilitating Enhancing

Safekeeping

New technologies associated with the product and its manufacture can make boats more attractive to consumers. Satellite phones let the boater take the power of global satellite communications out on the water. Inmarsat (one standard for satellite communications) is an 80-nation organization created in 1979 to provide quality worldwide mobile satellite communications for the maritime industry. Global positioning system (GPS) equipment manufacturers are updating their products to be more useful. Some equipment is being integrated with other marine electronics, such as fish finders and cell phones. Manufacturers have been able to enhance boat designs largely because of the advent of specialty computer software packages, generally termed computer-aided design (CAD) or computer-aided modeling (CAM) programs.
(Source - http://www.umsl.edu/~cca/IndustryReports/BBR-final-July2000.pdf - Centre for Competitive Analysis.)

Challenges: Environmental and Safety Regulations The boating industry has experienced difficulties with legislation from central government and taxes on this industry. The main problem is with environmental regulations, especially those governing emissions from outboard engines. Most of the major engine producers, especially Outboard Marine (OMC), have focused additional research and development efforts on designing cleaner running propulsion systems.

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This is a good tactic not just from pleasing regulators but also giving consumers an incentive to purchase one brand as oppose to another because of psychologically they are helping with the environment. Our company Mission statement - “We provide assistance as purchasing and acquisition agents for both domestic and international companies. We specialise in both commercial and private boats. We are experts in export business and have gained invaluable knowledge in dealing with foreign companies. We take pride in what we do in ensuring the customer is satisfied. We will endeavour to achieve competitive differentiation through lower prices than our competitors as well as providing a comprehensive customer service base for which we hope to retain customers through.” The true benefits that we provide consist of primarily „a one stop shop‟ for consumers to get to the best of our ability the products which they require in the least time possible. With a strong history in the engineering field, we have gained transferable skills which will be invaluable in selling boats. Our products Our expertise is in the engineering field which with the knowledge and experience we have gained has meant that we are in now in a position where we know which markets we wish to pursue. It is not company policy to turn down enquires which we receive both domestically and from foreign companies as these generate new customers and new suppliers with which to increase the market share of CDS. The applications that the boats can be used for do vary as discussed previously which consist of recreational or commercial. Our Unique selling proposition is „a one stop shop with an unbeatable response rate for any number of engineering products all over the world to meet our customers needs complimented with high quality products and competitive prices‟. We have had countless successors with our ability to conduct business with our customers in a professional manner. Our competitive edge comes down to our high speed in completion of tasks and the quality of the service which all our customers experience. We have a clear understanding of what are customers want and we know how to deliver a superior service no matter what the circumstances are. Keeping customers at the forefront of every day decisions has stood us in good stead and this is an integral part of how we will remain ahead of our competitors. Positioning There are a lot of much larger organisations in this market, we intend to not use an aggressive positioning strategy, more of a subtle introduction without visibly taking customers from the larger customers. Are ability to provide a much more efficient and effective service will be evident as customers do business with us.

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We have a very broad and diverse customer base which we can take advantage of which this market as we appeal to a wide audience in the effectiveness of the transactions that we complete. Ideally with the main objective being for the business to grow both domestically and internationally, having emphasis on exactly what we do as a company affects how we position ourselves in the future. Pricing strategy One of the key components to success in this market is having a price which attracts consumers but does not compromise profits. The quality and price will work hand in hand to ensure we reach our target audience efficiently and effectively. An aggressive marketing campaign with low prices for the boats will contribute to introducing consumers to these high quality boats from Egypt. Undoubtedly the price will attract attention as we are in some cases 50% cheaper than western boat manufacturers. PART 3 – THE MARKET

From research carried out in the UK the consensus is that approximately 451,000 boats (over 2.5 m) are kept in the UK and 90,000 UK-owned boats are kept abroad. The number of foreign owned boats kept in the UK is estimated at circa16,000 (source: British Marine Federation 2004 data). With reference to the number of consumers using boats, In September 2004, British Marine Federation carried out a survey amongst 6,000 people in the general population. This established that the true UK participation figure is approximately 3.5 million people, aged 16 and over ] The total revenues for the UK boating industry including the value of exports, the collective revenue for 2004 was £1,994 million. The size of the entire world‟s market for leisure marine products US retail sales are estimated at $26 Billion. The US market is about 4x bigger than the rest of the world. Thus the global figure is $32.5 Billion. Customers Geographic location of large proportion of customers Essentially the customers whom buy boats are Individual consumers primarily for use in recreational activities, make up the largest demand segment for the U.S. BBR industry, accounting for 79.4% of the value of sales in 1996. The commercial (6.9%) and “other” (13.7%) segments account for the remainder of the market. Because of general demographic trends over the past twenty years, the age range of customers buying the largest number of boats has changed from the 18-to-34 age group to the over-44 age group. A key reason for this change is the cost of living has increased which has meant that the lower socio economic group have less disposable income. A simple yet effective way to identify market segments is to look at the activities in which the consumers are interested, thus differentiating both the use and market segments is much more straight forward.

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The customer base that we at are aiming at with the Boats over the last 20 years is most certainly not homogenous in several ways which consist of firstly buying habits. Some of our customers buying behaviour is highly fragmented to a degree unpredictable which is why it is imperative that as an organisation we anticipate to the best of our ability these random quotes/enquires and deal with them in the best possible way. This principle is very important when looking at exporting, as our ability to ship Boats anywhere in the world will take a tremendous amount of organisation and team work. In essence today‟s consumer, is a seasoned, knowledgeable and deal seeking entity which demands a quality product, quality and quality supplementary services to accommodate their needs. With the resources which we have developed including particularly our website, we have the ability to increase our business all over the world. In recent years we have been limited to certain geographic areas which are feasible, now it is much more straight forward to do business in areas previously difficult if not impossible to work in. Market Size and Trends Marina projects were put on hold and consumer market growth was delayed, but Southeast Asia continues to offer significant growth opportunities for the boating industry. British consumers can be reluctant to spend because of worries about the health of the economy which in turn is affecting consumer confidence. When dealing with international markets exchange can both hinder and help with achieving sales around the world. The Philippines, which has been relatively unscathed by previous economic turmoil, is another country offering growth potential for boating. In America an organization has been set up called „The East Bay Economic Initiative‟, which is a group of Rhode Island boat builders and local business and government leaders. The main objective of this has been to lure buyers mainly from the UK, Germany and the Netherlands through sales promotions such as airfare reimbursements to buyers and by creating a Web site for foreign customers. Semicustom boat builder Sea Sport Boats of Bellingham, WA, has been marketing its Northwest-style sportfishing boats in Japan since a boat dealer in Kumamoto port sought out the manufacturer almost three years ago. Sea Sports‟ typical Japanese customers are wealthy, or they buy in groups because of the high price of fuel and moorage. This type of fishing boat, popular among open water anglers, is best known for its enclosed cabin, durability and dependability. Manufacturers of this “sport utility vehicle for the water” say these factors help extend the boat‟s popularity to new market regions. The medium and long-term prospects for the growth of the boating industry are good in Southeast Asia. With a total of more than 400 million consumers, there appears little doubt that the region will come back as a growth area during the next decade after economic problems. Finland and Sweden had robust boating markets in 1998 and are expected to be relatively strong in 1999, while the Danish and Norwegian markets can be described as lukewarm at best.

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The rigid inflatable boat (RIB) segment of the U.S. recreational boating industry is in its infancy when compared with that of Europe. Although the pleasure boat markets in most of the emerging economies of the Third World are not as developed as the U.S. market, they have a vast potential for increased boating activities Competition Northshore was established in 1971 at, in Chichester Harbour that Northshore. North Shore Yachts sell and make a wide range of boats including the following all over the world:- Power Boats - Mainly Yachts of difference sizes www.northshore.co.uk Oyster Marine was established in 1975, based in Suffolk. Oyster Marine have offices in America as well as it seems they have a good market in North America and the UK. They have a large range of sailing yachts and have tried to be innovative in creating a Powerboat which is suited towards yachtsmen both in it‟s design and usage. www.oystermarine.com Elan Boats was originally established in 1975 when it was called The American Skier Boat Company and based in Los Angles. They predominately sell small power boats and have good understanding of the market. www.elanboats.com Sunseeker, one of the largest boat manufacturers are based in Dorset, with a large amount of boats available to their cliental they have been very successful. They have targeted Power boats, ranging from Yacht Power boats to small power boats. www.sunseeker.com Chaparral is the biggest manufacturer of powerboats in the United States of American according to research carried out recently. They were established in 1965, with th headquarters in Nashville, Georgia. Fundamentally it is Powerboats which we sell, ranging from standard powerboats to sports boats and more recreational boats with sundecks. www.chaparralboats.com Formula is one of the oldest makers of boats, established in the 1950‟s in Florida the company has grown to export all over the world. Again as with Sunseeker and Chaparral, they have all gone with contemporary designs. They have provided powerboats to accommodate the varying needs of their target audience. The best website as it is implemented the specifications and layout as we have done on our website. www.formulaboats.com Bayliner is another one of the older makers of boats established in the 1960‟s in the United States of America. A very large company but the website is confusing and the navigation is not easy around it. Primarily contemporary boats, similar to the other American boat builders. www.bayliner.com

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In conclusion from the research which has been carried out, it is evident that there are a large amount of both brokers and makers in the UK. It could also be said that the market is saturated. However there is most certainly a niche for the boats we can sell as clearly we are extremely competitive on our price without compromising the quality. PART 4 – DEVELOPMENT Cost of Development – In today‟s business climate, it is essential to have a well designed and comprehensive website which will form the main area of our marketing strategy. As we already had a website in existence, the cost of putting the boat information onto the website was relatively minor. Labour Requirements – With expansion, we essentially need more personnel to have designated areas in which to focus on, without this the boat project would be difficult to maintain and is much less likely to succeed. We have collaborated with Dawnan and Paul Fastiggi whom CDS Consultants has worked with in the past. This has many benefits, as we have already a good relationship and understanding and they share the same vision as us in that they are highly motivated and want to succeed as much as we do. Also we have appointed a technical manager to take care of all aspects of the building and have a in depth of boats in general. Expenses and Capital Requirements – This start up costs are minimal, mainly administrative tools which are needed. The boat market can be highly profitable so on the first order, all start up costs will have been paid for. PART 5 – SALES AND MARKETING Strategy  How we plan to educate them about products? The way in which we plan to educate our target audience about our products by referencing the website with all quotes, letters and responses which are sent to potential customers will emphasise the website. Also for the client to visit to the boat yard in Egypt would be beneficial as they can get a further understanding of the product and the best ways to maximise its usage. The features of the products which we will emphasise to get the customers attention is ideally the build quality, the delivery period and high class customer service. The innovative marketing techniques which we will use is a contemporary website with a extremely efficient form for consumers to fill in which will go direct to CDS Consultants and colleagues with a response within a short period of time.

 

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Planning a Marketing Communications Campaign (5 Ws) Who is our target audience? What do we need to communicate and achieve? How should we communicate this? Where should we communicate this? When do communications need to take place? Method of Sales – As shown below in the marketing communications mix, there is a wide variety of distribution channels available to us. Feasibly using the internet is going to be the most successful as we are targeting socio economic groups all over the world. Advertising and Promotion – The website will form the main advertising and promotion for the boat portfolio. Once we have been using the website for a while, and the target market has an enhanced perception of what we do then trade magazines and advertising on trade sites would be appropriate.

Marketing Communications Mix
Personal Communications Selling Customer service Training Word-of-mouth
(other customers)

Advertising Broadcast Print

Sales Promotion Sampling

Publicity & Public Relations Press releases/kits Press conferences Special events Sponsorship

Instructional Materials Web sites

Corporate Design Signage Interior decor

Coupons Internet Outdoor Retail displays Cinema theater Telemarketing Discounts Sign-up rebates Gifts Prize promotions

Manuals

Brochures Videoaudiocassettes Software CD-ROM Voice mail

Vehicles Equipment

Stationery Uniforms

Direct mail

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PART 6 – MANAGEMENT Description – The company management, including their responsibilities and expertise of each person is as follows:i) Paul – Sales ii) Dawnan – in charge of all administrative activities / sales iii) David – Technical iv) Chris – Support v) Simon – marketing and support vi) Shady – Agent in Egypt PART 7- FINANCE

Risks In the last few years and one of the major problems with the internet is illegitimate organisations, predominantly from Africa who committing fraudulent activities. As a general rule, if appropriate and possible, it would be useful to investigate clients before they buy from us to ensure that they are not time wasters and have creditability. We have to be careful with payments to the boat yard in Egypt as establishing trust and securing procedures for payment of boats is vital from the beginning so there are no misunderstandings. Profitability The potential margins which are viable with this product are very high and very lucrative, as we have a very low cost boat builder in Egypt without compromising the quality we have a very clear competitive edge which if utilised correctly will be very advantageous for all parties involved. A well organised and executed pricing policy will contribute to this as well as synergy between all team members as giving false information could have adverse consequences on success of this venture.

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