Business Planning and Financial Documents

Business Plan

Business Plan

Example Web Business Pty. Ltd.

John and Jenny Smith, Co-founders Example Web Business Pty. Ltd. Ph: (11) 5555 5555 Fax: (11) 5555 5555 contact@examplewebbusiness.com www.examplewebbusiness.com

The Company
Company Overview The Internet has opened up numerous opportunities for companies to communicate with prospects, customers, staff, and other interested stakeholders. In addition to communication, web sites provide a simple and easy tool through which companies can increase access to their products and services beyond the normal geographical constraints. Example Web Business Pty. Ltd. was founded in September last year by the owners, John and Jenny Smith, to service the web needs of businesses in Smithsville, USA. Both John and Jenny have experience in the following industries: sporting events, holiday resorts, and small ecommerce operations. The business will operate from a studio of the home of John and Jenny Smith at 2 Smith Street, Smithsville. The studio is a professionally configured office environment and includes: The initial company assets include: Business Pty Ltd The brand name Example Web Domain Web Office furniture Office hardware Office software Database of prospects name: site: Dedicated phone line Dedicated fax line Broadband Internet access 2 computers Laser printer Web design software Graphics software Contact management software

www.examplewebbusiness.com

www.examplewebbusiness.com

Significant intellectual property, along with the range of business contacts the owners have, also constitutes part of the companys assets. Company Ownership Example Web Business Pty. Ltd. was incorporated in the state of Example State, USA on (date). The Business Number is 123 456 789.

Example Web Business Pty. Ltd. is 100% owned by John and Jenny Smith. The Team John Smith John is the former webmaster for Smithville Sport and Recreation, Smithvilles largest sporting events organization company. Through his involvement there, John is well known and highly respected within the sporting industry of Smithsville and the surrounding area. John is the treasurer for the Smithsville Chamber of Commerce. Jenny Smith Jenny is the former Smithsville Tourism Board Manager. One of Jennys key roles was to encourage the use of the Internet in securing bookings for holiday resorts. Jenny was a vocal advocate and promoter of online booking systems, and is well recognized within Smithsville (and, indeed, the entire state) as an Internet expert who specializes in online booking systems for holiday resorts. Jenny is the vice-president of the Smithsville Golf Club. Start Up Financing The business is being funded from the owners savings and via cash flow. Initial costs (hardware, software, printers, phone lines, legal, etc.) have already been met from savings. The business is fully operational and set to go. Initial costings predict expenses to be $1,200, $1,400, $1,500, $1,100, $1,200 and $1,800 respectively for the first six months. Without any income whatsoever, the business can be funded from savings for a period of six months.

Service Offering
Business Services and Niches Served Example Web Business Pty. Ltd. will offer a range of web solutions: Web site design Web site hosting Web site maintenance Web site marketing Search engine optimization Ecommerce enabling Copywriting

Based on the experience and expertise of our team, the niches weve identified as target markets include:

Holiday resorts Sporting events and organizations Small businesses in need of ecommerce sites

Point of Difference The unique point of difference between Example Web Business Pty. Ltd. and its competition is that we will:

Be very easily found Offer a full range of web development and site management services Guarantee our services 100% to the market. Our research indicates that this is a major factor influencing the sales process for Internet-related services.

Keys to Success Marketing We need to get the business known and recognized as quickly as possible. To this end, our marketing strategies need to be effective and dynamic. Performance of Sites We will monitor the each site and keep our clients informed regularly of their sites performance. Immediate action will be taken on sites that do not perform as guaranteed to the customer. Referrals Related to the performance of the work provided (i.e. ecommerce sites) and the performance of our business, we will very vigorously encourage referrals from happy customers. The quality of our service and consistency of follow-up are of utmost importance in encouraging these referrals. Objectives

 To generate $240,000 in sales within 12 months. To generate $300,000 in sales in our second year of operation. To generate $350,000 in sales in our third year of operation. To make Example Web Business Pty. Ltd. the number-one recognized name in web development within the local business community within one year, as measured by surveys conducted by an independent third party.

Market Analysis
Web Development According to the latest data released by the Statistics Department of the Smithsville City Council: 44% of Smithsville businesses have a web site. 38% of Smithsville business owners without a web site say theyll get one within one year. 61% of Smithsville business owners with web sites say theyll upgrade their current site within the next year. Business Data Smithsville currently has 24,246 registered businesses. Business numbers have grown on an average of 3% annually over the past five years. Business growth has been highest in the retail sector, followed by professional services and manufacturing. The retail and professional services sectors are the market segments most likely to require web sites. The recent market survey and our competitor analysis convinced us that a significant (and growing) market is currently available for web development services, including both web design and development, and ongoing site maintenance. With businesses moving into the area at the rate of 727 per year, the future for web services in this area looks promising. Our specific niche markets (holiday resorts, sporting events and organizations, and small businesses in need of ecommerce) continue to grow at a similar rate. The ongoing maintenance of web sites is a market in which we predict significant growth. 84% of local site owners surveyed indicated that their current web developer provides no contracted ongoing servicing of the web site. Of those people surveyed, 63% indicated they would be strongly interested in having their site managed on an ongoing basis. Market Trends The most important trend that affects Example Web Business Pty. Ltd. is the increase in the uptake of Internet technology all over the world. The increase in Internet access in Smithsville alone is expected to see 80% of the local population online by December next year.

With this increasing market penetration of the web, more and more local businesses will utilize the Internet as a sales avenue in the coming years. Example Web Business Pty. Ltd. aims to capitalize on this growth. Our research strongly indicates that a web site is a major priority in the marketing plans of the majority of businesses within the area. The number of competitors in the local area also provides evidence of strong demand. Competition/Competitive Analysis The competition among local web developers is strong in terms of numbers, but moderate in terms of service offerings. Of the 82 web development companies listed in the local Yellow Pages, none identify the same specialized niches we have identified. Of these 82 web development companies, 56% specify the same services we will provide. Of these 45 companies, just 12 state they offer ecommerce-enabling services. Competition and Buying Patterns Branding and recommendations are cited as the two major influences affecting those selecting a web development firm. Given the high profiles of the owners of Example Web Business Pty. Ltd., we anticipate that branding will generate our sales initially. Our marketing strategies include a large number of tactics to facilitate the easy recommendation of our services. Of the 82 competitors within Smithsville, just one was identified by survey respondents as a web development firm of which they were aware (other than the web development firm they already used). How Competitors Market Themselves Surveys were completed to identify how businesses first heard of their web developer; the answer was overwhelmingly from a friend. Other research indicates traditional forms of advertising (specifically Yellow Pages and newspaper display advertising) to be the most common form of marketing utilized. Market Needs As competitive pressures increase from both domestic and international sources, and broadband Internet usage increases, more and more businesses recognize the need to have a quality web site, and to maintain it as an important part of the businesss overall strategy. Our research indicates that the majority of business owners recognize the need for a quality web site. Those who do not have a web site cited, Unable to find solution provider as the most common reason why they havent as yet procured one.

Market Segmentation Example Web Business Pty. Ltd. has identified specific niches for targeting. ecommerce sites Sporting events and organizations Holiday resorts Small businesses in need of

Because of the experience and relationships developed by the principals of Example Web Business, these niches have been identified as the best under a range of criteria: Easiest to access: both owners have long-established, influential contacts within the niches. Most profitable: all niches gain great value from a quality web site. The added value of the expertise and experience of our team means a higher price can be charged.

Marketing Strategy The Example Web Business Pty. Ltd. name will be strongly marketed within the first six months in an effort to establish brand awareness for the business. It is our intention to target the specific niches via a combination of direct approaches including direct mail, telemarketing, and the implementation of an education-based marketing strategy that includes white paper distribution, etc. Our marketing strategy will be completely focussed on sales leads generated specifically from within our target market. Our strategy will be education-based in an effort to ensure that we are perceived as expert and professional, and to communicate that we are able to complete the most complex of web sites. Marketing tactics will include: Internet education we can do it better web site that actually works display and classified ads Direct mail Regular seminars focused on Free reports Public relations efforts Web site critiques suggesting that Monthly offline newsletter DVD explaining how to develop a Newspaper advertising, including Post Office Box drops Networking Competitions Public speaking Yellow Pages advertising Writing articles

Marketing Collateral mouse pads and pens Market Analysis Summary are growing at 3% annually. Business numbers in Smithsville The majority of businesses in Company web site Contacts database Brochures Direct mail letters Promotional materials including

Smithsville do not have a web site.

The majority of those businesses without a web site indicate a strong desire to establish one. The majority of business web site within Smithsville will be upgraded with one year, according to their owners

Of course, as the boundaries of Internet access are unlimited, the opportunity to make sales outside Smithsville is also significant.

Strategy and Implementation

Marketing Key marketing strategies include the following. 1. Contact Database We will use existing database contacts and relationships to build a referral network of key referrers. Tactics that will be used include: Networking Direct mail Newsletter distribution

Potential strategic alliances with key individuals and companies will be identified and acted upon over time. At this stage, we view alliances with web hosting companies, Internet security firms, real time transaction specialists, industry and government bodies, and retailing groups as very important to our ongoing success. 2. Advertising Traditional advertising methods, including the Yellow Pages and large display ads, will be undertaken in the first two months of operation. We have also secured the use of a highway billboard (leading into Smithsvilles main street) for one month. Ongoing advertising will include newspaper classified, school newsletters, business Post Office Box drops, and some radio spots. Although not strictly advertising, sponsorship of key Smithsville charities (services only) will also be undertaken to raise the businesss profile. 3. Education Example Web Business will utilize a strong educational component to aid the positioning of the business as professional and expert. Free monthly seminars are planned to cover such topics as, Finding the best web developer for your business, and How the Internet can help your business grow, and Does my business need a web site? Free reports, white papers, public speaking, writing articles for local newspapers, and a free DVD (titled, How to develop the perfect web site for your business) will be used to reach the target market in an unobtrusive way. Public relations activities will be included as a means to alert prospects to the services we offer. 4. Online Promotion The Example Web Business site will be used in conjunction with the above tactics to demonstrate our professionalism, disseminate educational material, and make ongoing offers to our site visitors. The web site will be promoted at every opportunity, on all the business literature we distribute, and via search engines (both paid and unpaid listings).

Pricing Pricing has not been identified via our surveys as a major influence upon those deciding to purchase web services. Example Web Business will utilize three basic pricing structures: 1. Per project: based on estimated value provided, time required, and expenses incurred. 2. Retainer: based on the anticipated number of hours required per month, including an Always available surcharge. 3. Per hour: across our range of services, the average price per hour charged will be $80. Positioning Example Web Business will be positioned as a highly professional organization that is able to provide superb web solutions for our target markets, with superior customer service as a key issue. Our 100% satisfaction guarantee will be a major component of our positioning within the market. Sales Forecast The forecast of sales provided (see the file titled Example Business Financials.xls on this kits CD-ROM) takes into account the proposals we have already submitted for prospective clients projects and assumes payment of 50% of the estimated total charge for each project up front.

Financials
For the business financials, please refer to the attached spreadsheets (see the file titled Example Business Financials.xls on this kits CD-ROM). The cashflow position of the businesss first month, as illustrated in the Cashflow Forecast, is anticipated to be strong. The business will generate an estimated $11,680 in sales, and incur total operating expenses of $6,400. Profit for the period is expected to reach $3,470. Using the strategies outlined in this plan, it is anticipated that sales will continue to grow over ensuing months. In its first year, the business plans to sell $300,000 worth of services, of which over $54,000 will represent net profit (see Projected Profit and Loss Statement for details).