1. MADE FOR MIZZI
BUSINESS PLAN
Prepared by; Sam Messmer, Andrea Mizzi and Chan Richardson
2010
Copyright 2010
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2. TABLE OF CONTENTS FOR WRITTEN REPORT
1. INTRODUCTION............................................................................................................20
BUSINESS SUMMARY ...................................................................................................22
2.3MARKETING PLAN:....................................................................................................22
2.4OPERATIONAL PLAN: ...............................................................................................23
2.5FINANCIAL PLAN:.......................................................................................................24
BUSINESS PROFILE........................................................................................................25
3.1 BUSINESS DESCRIPTION:........................................................................................25
3.1.2 LEGAL STRUCTURE OF BUSINESS (TICK AS APPLICABLE):..........................26
3.1.4 INDUSTRY KNOWLEDGE AND EXPERIENCE / SKILLS OF KEY PERSONNEL:
............................................................................................................................................26
3.1.5 LOCATION AND DESCRIPTION OF PREMISES:..................................................27
3.2 SWOT ANALYSIS.......................................................................................................27
STRENGTHS.....................................................................................................................27
THE STRENGTHS OF OUR BUSINESS ‘MADE FOR MIZZI’, OUTLINED IN THE
EARLIER SWOT ANALYSIS; ARE OFFERING A FRESH AND UNIQUE PRODUCT TO
OUR CONSUMERS (THIS WAS THE MAIN REASON FOR OUR SUCCESS DURING
OUR TRIAL PERIOD), CONSTANT PROFITS EVEN THOUGH CHANGES IN
PRODUCT PRICES WERE MADE, SOME OF OUR PRODUCTS CAN ONLY BE
BOUGHT ONLINE - OUR BUSINESS GIVES OUR CONSUMERS THE OPTION TO
BUY THESE ITEMS IN A REAL LIFE SITUATION AND REDUCE THEIR RISK OF
FRAUD, OUR PRODUCTS WERE POPULAR AMONGST OUR TARGET MARKET,
ESTABLISHED OUR CUSTOMER BASE THROUGH ADVERTISING OUR BUSINESS,
PRODUCTS WEREN’T BULKY THEREFORE WERE EASY AND LOW
MAINTENANCE TO STORE, MATERIALS WERE RELATIVELY CHEAP –
ESPECIALLY WHEN BOUGHT IN BULK WILL INCREATE COST EFFECTIVENESS.27
WEAKNESSES..................................................................................................................28
OUR MAIN WEAKNESSES WERE THAT IT WAS VERY TIME CONSUMING TO HAND
MAKE THE KEY RINGS, DELIVERY TIMES WAS EXTREMELY UNRELIABLE AND
SUPPLIERS WERE NOT DEPENDABLE. THIS CAUSED CUSTOMER
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3. DISSATISFACTION AND LOSS OF LOYALTY AS THE PRODUCTS THEY PAID FOR
WERE NOT AVAILABLE ON THE DATE THEY WERE PROMISED. TECHNOLOGICAL
ADVANCES (IPOD) CAUSED DEPRECIATION IN OUR GOODS SOLD (NO LONGER
USED BY CUSTOMERS), CAUSING A LOSS IN FINANCES. BECAUSE WE DIDN’T
MANUFACTURE ALL OF THE PRODUCTS OURSELVES (IPOD CASES AND
ERASERS) THE PRODUCT AVAILABILITY WAS LIMITED. THESE PRODUCTS ALSO
REQUIRED A LARGE SUM OF CAPITAL TO SUCCESSFULLY RUN THE BUSINESS
(PURCHASING STOCK). ................................................................................................28
OPPORTUNITIES..............................................................................................................28
POTENTIAL OPPORTUNITIES FOR MADE FOR MIZZI INCLUDE EXPANSION INTO
BULK BUYING PRODUCTS SUCH AS IPOD CASES, ERASERS AND MATERIALS
REQUIRED FOR THE KEY RINGS. THIS WOULD REDUCE COSTS AND ALLOW US
TO COMPETE WITH THE MORE ESTABLISHED ORGANISATIONS. ANOTHER
VIABLE OPTION WOULD BE MANUFACTURE THE PRODUCTS OURSELVES,
CREATING MORE INDEPENDENCE AND RELIABILITY INCREASING CUSTOMER
BASE AND SATISFACTION. DUE TO THE SMALL RANGE OF STOCK WE WOULD
SELL ‘MADE FOR MIZZI’ WOULD HAVE TO CONSIDER MERGING WITH ANOTHER
SIMILAR ORGANISATION TO MAXIMISE BULK BUYING EFFORTS. AS BULK
BUYING WILL INCREASE OUR CUSTOMER BASE IT WILL ESTABLISH OUR
BUSINESS NAME AND PRODUCTS, THEREFORE CREATING OPPORTUNITIES TO
EXPAND NATIONALLY AND INTERNATIONAL THROUGH E-BUSINESS. ...............28
THREATS..........................................................................................................................28
THREATS THAT COULD IMPACT ON OUR BUSINESS INCLUDE A LOSS OF
CUSTOMER BASE THROUGH ESTABLISHED COMPETITORS SELLING SIMILAR
PRODUCTS. ALSO OUR ESTABLISHED COMPETITORS HAVE MORE FINANCE
OPTIONS TO COMPETE WITH SMALLER BUSINESS SUCH AS MADE FOR MIZZI.
THEIR ESTABLISHED NAME ALSO POSES A THREAT TO NEW SMALLER
BUSINESSES AS THEY WOULD ALREADY HAVE A WELL ESTABLISHED
CUSTOMER BASE. THE RELATIONSHIP BETWEEN SUPPLIERS AND IMPORTERS
ALSO POSES THREATS THROUGH BANKING SECURITY. FURTHERMORE
TRUSTWORTHY SUPPLIERS MUST BE SOUGHT AND MAINTAINED OR STOCK
WILL NOT ARRIVE ON SCHEDULE AND FINANCIAL DIFFICULTIES MAY OCCUR.
............................................................................................................................................28
MARKET ANALYSIS - THE MARKET & YOUR POSITION IN IT...................................29
............................................................................................................................................33
4.4.MARKET RESEARCH.................................................................................................33
4.5MARKET SEGMENTS..................................................................................................35
CUSTOMER PROFILE:- EXISTING AND POTENTIAL:..................................................36
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4. THE TARGET MARKET IS ALSO HIGHLY UNPREDICTABLE. THIS YOUNGER
GENERATION’S WANTS ARE CONTINUALLY CHANGING, THEREFORE TRENDS
THAT MAY BE POPULAR ONE DAY, MIGHT NOT BE THE NEXT. ‘MADE FOR MIZZI’
MUST CONTINUALLY CONDUCT MARKET RESEARCH IN ORDER TO GAIN A
MORE IN-DEPTH AND UP-TO-DATE UNDERSTANDING OF CONSUMER
BEHAVIOUR......................................................................................................................37
TARGET MARKET, MARKET SIZE, EXPECTED GROWTH RATES OVER SHORT
TERM & LONG TERM PERIODS.....................................................................................37
ACCORDING TO THE ABS, THE AUSTRALIAN BUREAU OF STATISTICS (WHOSE
PURPOSE IS TO PROVIDE THE PUBLIC WITH NATIONAL STATISTICS) THERE IS
2.7 MILLION TEENAGERS IN AUSTRALIA AND THEY MAKE UP 12.3% OF THE
NATIONAL MARKET. OF THIS, 70 TO 80% HAVE COMPUTER AND INTERNET
ACCESS THEREFORE E-BUSINESS IS A CONTINUAL METHOD OF SELLING
PRODUCTS. FURTHERMORE HALF A MILLION AUSTRALIAN TEENAGERS OWN A
PORTABLE MUSIC DEVICE AND WORLD WIDE 100 MILLION IPODS HAVE BEEN
SOLD SINCE ‘APPLE’ (THE COMPANY WHICH PRODUCES IPODS) COMMENCED.
THIS DATA SHOWS THE IMMENSITY OF OUR POTENTIAL CONSUMER BASE AND
SHOWS OPPORTUNITIES FOR GLOBAL EXPANSION. ...........................................38
5. COMPETITIVE ANALYSIS...........................................................................................38
5.1 SWOT ANALYSIS ON YOUR COMPETITORS:........................................................38
5.1.1. STRENGTHS...........................................................................................................38
STRENGTHS OUR COMPETITORS SHOW OVER OUR SMALL BUSINESS IS THAT
THEY ARE;........................................................................................................................38
WELL ESTABLISHED WITHIN THE LOCAL AND NATIONAL COMMUNITY...............38
HIGHLY PROFITABLE......................................................................................................38
ABLE TO AFFORD MORE ON ADVERTISEMENTS AND PRODUCT DEVELOPMENT
............................................................................................................................................38
MASS PRODUCTION = CHEAPER PRODUCTS............................................................38
5.1.2. WEAKNESSES........................................................................................................38
OUR COMPETITORS WEAKNESSES INCLUDE;...........................................................38
LIMITED CUSTOMER RELATIONSHIP WITH BUSINESS BECAUSE OF LARGE
BUSINESS SIZE................................................................................................................38
REPUTATION IS HARDER TO CHANGE (TOO WELL ESTABLISHED WITHIN THE
COMMUNITY)....................................................................................................................38
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6. 6. MARKETING PLAN - SELLING YOUR PRODUCT/SERVICE....................................40
6.1 GOALS AND OBJECTIVES: .....................................................................................40
THE GOALS AND OBJECTIVES OF OUR MARKETING STRATEGY ARE TO REACH
AS MANY POTENTIAL CUSTOMERS AS WE CAN. THROUGH MARKETING WE
WANT TO ACHIEVE THE GOAL OF UNDERSTANDING OUR CUSTOMERS AND
THEIR ROLE IN THE DECISION MAKING PROCESS IS CRUCIAL TO PROPERLY
REACHING AND SUCCESSFULLY SERVING OUR IDENTIFIED TARGET.
............................................................................................................................................40
6.2 OVERVIEW OF MARKETING STRATEGIES: ..........................................................40
OUR STRATEGY TO ACCESS AND BE SUCCESSFUL IN OUR TARGET MARKET
INCLUDES PAGES ON POPULAR NETWORKING SITES SUCH AS FACE BOOK. WE
WILL CREATE ADVERTISEMENTS NOT ONLY FOR TELEVISION BUT ALSO ADDS
ON THE POPULAR VIDEO SHARING SITE YOU TUBE. THIS NOW FEATURES
MORE OPPORTUNITIES FOR BETTER ADVERTISEMENT TO REACH OUR
DESIRED TARGET MARKET THAN EVER BEFORE. OUR ADVERTISING STRATEGY
FOR POSTERS SUPPORTS THE DESIRED POSITIONING OF OUR BUSINESS BY
BEING BIG, BOLD AND UNIQUE TO CATCH PEOPLE’S ATTENTION. BY PUTTING
PICTURES OF OUR PRODUCTS AROUND OUR BUSINESS NAME WE ARE
VISUALLY COMMUNICATING TO OUR POTENTIAL CUSTOMERS WHAT OUR
BUSINESS IS ABOUT. WE FOCUSED ORE ON VISUAL COMMUNICATION RATHER
THAN TEXT (WITH POSTERS) TO COMMUNICATE OUR PRODUCTS QUICKER
WITH OUR TARGET MARKET. THIS METHOD WAS STRATEGICALLY PUT IN
PLACE SO OUR MESSAGE IS DELIVERED SIMPLY TO ATTRACT CUSTOMERS TO
LOOK AND TO RECEIVE THE MESSAGE FROM OUR BUSINESS QUICKLY AS
OPPOSED TO THE SURROUNDING BUSINESS POSTERS. SALES PROMOTION
METHODS WILL ALSO BE UTILIZED (DISCOUNT DAYS, PROMOTIONAL
COUPONS, CONTESTS, FREE PRODUCTS ETC). ANOTHER IMPORTANT
MARKETING STRATEGY IS BUILDING A POSITIVE PUBLIC IMAGE. WE HOPE TO
ACHIEVE THIS BY DOING OUR BEST TO BE ECO – FRIENDLY AND SUPPORTING/
PROMOTING ENVIRONMENT AWARENESS WITH OUR BUSINESS. OTHER
STRATEGIES INCLUDE BEING FAIR TO CUSTOMERS BY IMPLEMENTING A FAIR
RETURN POLICY THIS WILL BUILD A GOOD NAME FOR OUR BUSINESS ALSO. AS
WELL AS MAINTAIN A GOOD PR, PR REFERS TO PUBLIC RELATIONS. THIS IS
THE PROCESS OF ESTABLISHING AND MAINTAINING A GOOD RELATIONSHIP
WITH CUSTOMERS, BUSINESS TO DO THIS TO GET A GOOD REPUTATION FROM
CUSTOMERS AND POTENTIAL CUSTOMERS WHICH CREATES A RELATIONSHIP
BETWEEN THE TWO PARTIES. (WIKIPEDIA, 2010).....................................................41
6.3 PRODUCT: (PHYSICAL GOOD OR SERVICE)........................................................41
ADDITIONAL FEATURES TO THE PRODUCT ITSELF INCLUDE QUALITY,
ACCESSORIES, INSTALLATION, INSTRUCTIONS, WARRANTY, PACKAGING AND
BRANDING. THE QUALITY REFERS TO HOW RELIABLE OUR PRODUCTS WERE,
FROM CUSTOMER FEED BACK IT WAS DETERMINED THAT OUR PRODUCTS
WERE OF A SATISFACTORY AT OUR TRIAL RUN OF THE BUSINESS. THIS
RESULT WAS TO BE EXPECTED AS THEY WERE MADE AS MORE OF AN
EXPERIMENTATION FOR THE TRIAL RUN. HOWEVER ONCE WE OPEN OUR
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7. BUSINESS QUALITY LEVELS WILL IMPROVE DRAMATICALLY MAINLY DUE TO
IMPROVED OPERATIONS MANAGEMENT. WARRANTIES CAN NOT BE PUT IN
PLACE FOR OUR PRODUCTS AS THEY ARE ALL UNDER $20. HOWEVER FAIR
REFUND OPTIONS FOR FAULTY PRODUCTS WILL BE PUT IN PLACE. (E.G. BRING
BACK PRODUCT WITHIN 30 DAYS FOR FULL REFUND OR REPLACEMENT IF
FOUND TO BE FAULTY AS A RESULT OF THE MANUFACTURE.) IN OUR
BUSINESS WE HAVE 3 DIFFERENT PRODUCT LINES, ONE FOR EACH DIFFERENT
PRODUCT; IPOD CASES, KEY RINGS AND ERASERS. EACH PRODUCT LINE ALSO
HAS A DIFFERENT IMPORTING METHOD; FOR THE IPOD CASES AND ERASERS
WE ARE IMPORTING FROM EBAY, HOWEVER FOR THE KEY RING PLUSHIES
MATERIALS WILL BE OUTSOURCED FROM FABRIC STORES SUCH AS SPOT
LIGHT, WITH THE MATERIALS WE WILL THEN HAND MAKE THEM INTO THE
DESIRED PRODUCT. PACKAGING IS THE FINAL CONCEPT THE PRODUCT WE
HAVE TO DEAL WITH. PACKAGING NEEDS TO KEEP THE PRODUCT SAFE,
IDENTIFY THE BUSINESS, CONTAIN THE PRODUCT AND ARE APPEALING TO
CUSTOMERS. WE HAVE MADE OUR PACKAGING WHICH FEATURES OUR
BRANDING NAME WITH A MESSAGE ‘THANKS FOR SHOPPING AT MIZZI’ (FIGURE
11). THIS SHOWS OUR CUSTOMERS WE APPRECIATE DOING BUSINESS WITH
THEM AND MAKES OUR PACKAGING, BUSINESS AND PRODUCT APPEALING.. .42
6.4 PLACE: (REACHING THE TARGET MARKET): .....................................................42
6.5 PRICING: ....................................................................................................................44
6.6 OBJECTIVES, FLEXIBILITY, DISCOUNTS, ALLOWANCES...................................45
OUR BUSINESS USED A COMBINATION OF COST PLUS PRICING AND
PHYSIOLOGICAL PRICING IN ORDER TO DETERMINE THE PRICES FOR OUR
PRODUCTS. PHYSIOLOGICAL PRICING WAS WORKED OUT BY INTERVIEW
POTENTIAL CUSTOMERS ON THEIR IDEA OF A ‘SUITABLE’ PRICE FOR OUR
PRODUCTS. WITH THIS INFORMATION IN MIND WE WILL ALSO CALCULATE HOW
MUCH WE NEED TO BREAK EVEN AND TO MAKE A SUITABLE PROFIT ALSO
KNOWN AS COST PLUS PRICING. COST PLUS PRICING IS IMPORTANT FOR THE
CONTINUATION AND EXPANSION OF OUR BUSINESS. WE BELIEVE THIS WILL BE
AN EFFECTIVE STRATEGY AS WE WILL ENSURE WE ARE SELLING OUR
PRODUCT AT THE RIGHT PRICE TO BREAK EVEN AND TO MAKE A PROFIT BUT
ALSO BECAUSE WE ARE INCLUDING OUR CUSTOMERS ON BUSINESS
DECISIONS IT WILL MAKE THEM FEEL APART OF THE DECISION MAKING
PROCESS AND PERHAPS ENSURE MORE LOYALTY AND SATISFACTION FROM
OUR CUSTOMERS. RELATIVE TO OUR COMPETITION, OUR PRICING STRATEGY
IS TO HOLD STOCK WHICH DOES NOT COST MUCH TO IMPORT OR MAKE TO
SELL AT THE LOWEST POSSIBLE PRICE TO GIVE US THE HIGHEST POSSIBLE
REVENUE. TO HAVE A COMPETITIVE EDGE OVER COMPETITORS WITH PRICING
AND TO ALSO MAINTAIN AND GROW OUR BUSINESS WITH REVENUE. WHEN
DETERMINING PRICES WE ALSO REALISED THAT WE HAVE TO HAVE
FLEXIBILITY PRODUCTS PRICE TO CHANGE FOR ITS STAGES THROUGH ITS
LIFE CYCLE AND FOR DISCOUNTS AND PROMOTIONS. DISCOUNTS AND
ALLOWANCES WILL BE USED IN THE EVENTS OF SALE PROMOTIONS THIS IS
DISCUSSED IN SECTION 6.2 OF THIS REPORT...........................................................45
6.7 PROMOTION: .............................................................................................................45
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8. ACTIVITIES UNDERTAKEN BY THE BUSINESS TO FAMILIARISE AND ADVERTISE
PRODUCTS IS KNOWN AS PROMOTION. PROMOTION DIFFERS FROM
ADVERTISING AS IT IS THE BROADER TERM TO INCLUDE ALL ACTIVATES TO
MAKE A PRODUCT KNOWN (ABOUT.COM, 2010). ....................................................45
6.8 TRADING HOURS.....................................................................................................46
SUITABLE TRADING HOURS FOR THE BUSINESS WOULD BE 9 – 5 DURING THE
WEEK, 8 – 3 ON SATURDAYS AND CLOSED ON SUNDAYS. AT THIS CURRENT
TIME ‘MADE FOR MIZZI’ IS RUN BY THE 3 OWNERS IN EVERY ASPECT, NO
OTHER EMPLOYEES BELONG TO THE BUSINESS, HOWEVER IN THE EVENT OF
EXPANSION SALES STAFF WILL BE EMPLOYED TO RUN OTHER STORES, IN
THIS EVENT TRADING HOURS MAY BE EXPANDED..................................................46
6.9 COMMENT ON OTHER FACTORS REGARDING YOUR MARKETING
STRATEGIES ...................................................................................................................46
6.10 EXPORT INTENTIONS.............................................................................................46
E-BUSINESS WOULD ALSO BE A GOOD OPTION FOR MADE FOR MIZZI, AS IT
WOULD REDUCE RUNNING COSTS AND INCREASE MARKET EXPOSURE. THIS
OPTION WOULD BE THE MOST VIABLE DEPENDING ON THE AMOUNT AND
TYPES OF PRODUCTS WE WOULD SELL. PARTNERING WITH ANOTHER
ORGANISATION WOULD BE ANOTHER VIABLE OPTION..........................................47
7. OPERATIONAL PLAN .................................................................................................47
THE VARIOUS ASPECTS OF MADE FOR MIZZI’S OPERATION PLAN HAVE BEEN
ANALYSED IN ACCORDANCE TO THE RETAIL INDUSTRY SECTOR, AS SEEN IN
APPENDIX.........................................................................................................................47
7.1 PREMISES & CAPITAL..............................................................................................47
EQUIPMENT......................................................................................................................48
7.2 ADDITIONAL COSTS..................................................................................................49
STORAGE..........................................................................................................................49
STORAGE IS REQUIRED TO SAFELY MAINTAIN PRODUCTS IN THE TRANSITION
PROCESS FROM SUPPLIER TO CONSUMER. THIS HAS THE POTENTIAL TO
OCCUR EXTRA COSTS, THEREFORE INITIALLY STORAGE WILL BE AT THE
PREMISES OF THE BUSINESS. HOWEVER AS THE BUSINESS GROWS A
WAREHOUSE MAY BE REQUIRED FOR HOLDING STOCK. THE MAIN AIM FOR
INITIAL SET UP IS TO MINIMISE STORAGE COSTS AS WE EXPAND INVENTORY
MANAGEMENT SYSTEM WILL BE IMPLEMENTED TO REDUCE THESE EXTRA
COSTS...............................................................................................................................49
LEASING/PURCHASING..................................................................................................49
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9. TO OPERATE A BUSINESS LEGALLY ONE NEEDS TO MEET ALL THE LAWS FOR
OPERATING A BUSINESS [2]. THESE INCLUDE:.........................................................49
AUSTRALIAN BUSINESS NUMBER...............................................................................49
CONTRACTS – LEASE, EMPLOYEES ETC....................................................................49
COMPLIANCE WITH AUSTRALIAN TAXATION OFFICE AND AUSTRALIAN
SECURITIES AND INVESTMENTS COMMISSION.........................................................49
COMPLIANCE WITH THE AUSTRALIAN COMPETITION AND CONSUMER
COMMISSION (ACCC) PROMOTES COMPETITION AND FAIR TRADE FOR
CONSUMERS, BUSINESSES AND THE COMMUNITY. IT ALSO REGULATES
NATIONAL INFRASTRUCTURE SERVICES [3].............................................................49
SOME OF THE LEGAL AND POLITICAL FACTORS THAT CAN AFFECT ‘MADE FOR
MIZZI’ INCLUDE COPYRIGHT INFRINGEMENTS. THEREFORE ‘MADE FOR MIZZI’
WILL REQUIRE PERMITS TO RECREATE THESE CARICATURES (PACMAN,
GHOSTS) AND WOULD PROBABLY BE REQUIRED TO PAY ROYALTIES (A
PERCENTAGE OF PROFIT). IF THIS IS NOT STRICTLY FOLLOWED, THE BUSINESS
COULD FACE LEGAL ISSUES AND INFRINGEMENTS. ..............................................49
ANOTHER ISSUE IS THE RELIABILITY OF OVERSEAS SUPPLIERS AS THEY ARE
LESS PREDICTABLE AND CANNOT BE MONITORED – THEREFORE AN
INCREASED LEVEL OF FINANCIAL RISK (LEGAL CONTRACT IS REQUIRED).......49
ADDITIONAL COSTS WILL BE INCURRED THROUGH BUSINESS AND STOCK
INSURANCE, TAXATION AND THE GOOD AND SERVICES TAX (AUS = 10%).........49
7.3 HUMAN RESOURCE MANAGEMENT ......................................................................49
HUMAN RESOURCE MANAGEMENT IS THE MANAGEMENT OF THE EMPLOYEE
RELATIONSHIP IT COVERS ESTABLISHING, MAINTAINING AND TERMINATING
EMPLOYMENT. THE FUNCTION OF HRM INVOLVES PLANNING, ORGANISING,
LEADING AND CONTROLLING THE NEEDS OF AN ORGANISATION.......................49
HOW MANY STAFF..........................................................................................................50
STAFF NUMBERS WILL BE DETERMINED AS THE BUSINESS GROWS. HOWEVER
FOR THE MOMENT, IN REGARDS TO THE SIZE OF THE BUSINESS IT IS
MANAGEABLE BY THE 3 OWNERS...............................................................................50
JOB DESCRIPTION..........................................................................................................50
JOB SKILLS REQUIRED..................................................................................................50
INITIALLY, NO EMPLOYEES WILL BE HIRED, HOWEVER AS TIME PASSES – THE
POSSIBILITY WILL OCCUR. THE MAJORITY OF ASSISTANCE REQUIRED WOULD
BE IN THE PRODUCTION SECTOR (KEY RINGS). THIS REQUIRES SPECIALLY
August 2010 The Small Business Plan for Made for Mizzi Page 9
10. SKILLED EMPLOYEES, HOWEVER, THE TYPE OF EMPLOYMENT (DULL-TIME,
PART-TIME) THEY WOULD RECEIVE WOULD DEPEND ENTIRELY ON PRODUCT
DEMAND (LOWER DEMAND = LOWER EMPLOYMENT NUMBERS). IN THE
FUTURE, IF THE BUSINESS IS A SUCCESS – EXTRA ASSISTANCE IN THE
FINANCIAL AND MARKETING SIDE WILL BE REQUIRED. ALSO NECESSARY FOR
AN ONLINE BUSINESS IS AN IT EXPERT – ABLE TO CREATE AND EFFICIENTLY
RUN AN ONLINE WEBSITE.............................................................................................50
RECRUITMENT.................................................................................................................50
RECRUITMENT WILL BE ORGANISED THROUGH ADVERTISEMENT – INTERNALLY
OR WITH A RECRUITMENT AGENCY. ALL APPLICANTS WOULD BE PROPERLY
PROCESSED AND INTERVIEWED AND A DECISION WOULD BE MADE..................50
TRAINING AND DEVELOPMENT....................................................................................50
WAGES AND OVERHEADS.............................................................................................50
WAGES WOULD BE PAID ACCORDING TO THE QUEENSLAND GOVERNMENT
WAGES (RETAIL SECTOR) INFORMATION. DEPENDING ON TYPE, LEGAL ADVICE
WOULD BE TAKEN TO CONSTRUCT THE CONTRACT...............................................50
IN REGARDS TO WORKFORCE, WE PLAN ON HAVING A FLEXIBLE WORKFORCE,
WHERE EMPLOYEES ARE MULTI-SKILLED AND ARE ABLE TO WORK IN A
BROAD RANGE OF ENVIRONMENTS – WITH LIMITED TO NO SUPERVISION. THIS
IDEAL EMPLOYEE WOULD BE AN ASSET TO THE ORGANISATION AS IT WOULD
CREATE A FLEXIBLE EMPLOYEE WHO IS ABLE TO WORK IN AN PART OF THE
BUSINESS WHEN NEEDED – IT WILL ENLARGE THE BUSINESS’S CAPABILITIES.
............................................................................................................................................51
WORKPLACE HEALTH AND SAFETY WILL BE FOLLOWED AND MAINTAINED
THROUGH REGULAR INSPECTION AND UPDATING OF NEW LEGISLATION.........51
7.4 POLICIES AND PROCEDURES MANUAL................................................................51
8. FINANCIAL PLAN -YOUR INVESTMENT & EXPECTED TURNOVER & PROFIT -
CHAN.................................................................................................................................53
FINANCE IS ULTIMATELY UP TO THE FINANCE DEPARTMENT TO ACCESS THE
VIABILITY OF A PROJECT AND ITS ABILITY TO ACHIEVE THE OBJECTIVES OF
THE BUSINESS. A SOUND FINANCIAL STRATEGY REQUIRED THE MANAGER TO
MAKE DECISIONS ABOUT THE TYPES OF FINANCE. THE WRONG TYPES OF
FINANCE CAN BE VERY COSTLY TO THE BUSINESS, WHILE A POOR FINANCE
STRATEGY CAN RESULT IN OVER- OR UNDER-CAPITALISATION..........................53
THE FIRST TASK FOR A NEW BUSINESS IS TO WORK OUT HOW MUCH MONEY IS
NEED TO START THE BUSINESS, AND WHETHER THE FUNDS AND SAVING IS
SUFFICIENT OR NEED TO OBTAIN FINANCE. THE TYPE OF START UP COST WILL
DIFFER DEPENDING ON THE TYPE OF BUSINESS, SUCH AS THE COST OF
STARTING A NEW BUSINESS IS DIFFERENT TO BUYING AN EXISTING BUSINESS
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11. OR BUY A FRANCHISE. AS “MADE FOR MIZZI” IS A SCHOOL PROJECT AND IS
RUNNING UNDER THE SCHOOL ENVIRONMENT, THEREFORE THERE ARE NO
START-UP COST AND EXTRA FEES CHARGED. HOWEVER, SOME EXPENSES
WILL INCUR WHEN RUNNING THE BUSINESS. FOR EXAMPLE, EXPENSES SUCH
AS LEGAL, ACCOUNTING OR CONSULTING FEES WILL NOT OCCUR BECAUSE
ONCE AGAIN, THIS IS A SCHOOL PROJECT AND THE BUSINESS IS ONLY
RUNNING FOR THREE DAYS. HOWEVER OTHER EXPENSES SUCH AS
INVENTORIES EXPENSE WILL INCUR WHEN PURCHASING GOODS FOR THE
BUSINESS. THE THREE TABLES AND CALCULATIONS BELOW SHOW THE
QUANTITY, THE ORIGINAL COST PER UNIT AND THE APPROXIMATE COST TO
START UP THE BUSINESS.............................................................................................53
= ($170 – $70.05/$170) X 100.........................................................................................54
= 0.5879 X 100.................................................................................................................54
= (($20 – $12.53)/$20) X 100..........................................................................................54
= 0.3735 X 100.................................................................................................................54
= 37%...............................................................................................................................54
= (($21.5 – $17)/$21.5) X 100........................................................................................54
= 0.209302 X 100....................................................................................................54
.........................................................................................................................................54
OVERALL GROSS PROFIT MARGIN = (($211.5 – $115.68)/ $211.5) X 100
............................................................................................................................................54
= 0.453049.......................................................................................................................54
= 45%...............................................................................................................................54
BREAK-EVEN POINT = TOTAL OVERHEADS/ GROSS PROFIT MARGIN .56
BREAKEVEN POINT OF IPOD CASES = $81.15/ 59% ..................................56
= $137.54...................................................................................................56
BREAKEVEN POINT OF KAWAII ERASERS = $17.53/ 37% .......................................56
= $47.35............................................................................................56
BREAKEVEN POINT OF KEY RINGS = $17/21% ..........................................................56
= $80.95......................................................................................................56
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12. BREAKEVEN POINT OF THE BUSINESS = $115.68/ 45%............................................56
= $257.07...........................................................................56
PRICE IS WHAT IS CHARGED BY THE SUPPLIER TO THE CONSUMER AND IT IS
ONE THE MOST IMPORTANT ASPECTS OF THE MARKING MIX. PRICE OFTEN
IMPACT ON THE AMOUNT OF REVENUE GAINED FROM THE SALE OF PRICE
SENSITIVE PRODUCTS OR SERVICES, AND MAY THEREFORE DIRECTLY IMPACT
ON THE ULTIMATE SURVIVAL OF THE BUSINESS THE PRICING STRATEGY
CONSISTS OF SETTING AN INITIAL PRICE FOR THE PRODUCTS, AND THEN
TAKES DETAILED RECORDS OF HOW THE PRODUCT PERFORMS AT THE GIVEN
PRICE, AND REPRICES THE PRODUCT BASE ON THE RESULTS. IF HIGHER
PROFIT IS MADE, THE SELLING PRICE SHOULD EITHER STAY THE SAME OR
INCREASE. IF LOWER PROFIT IS MADE THEN OBVIOUSLY THE SELLING PRICE
NEEDS TO BE DECREASE. ............................................................................................56
DURING THE ENTERPRISE WEEK, THE PRICES OF THE IPOD CASES REMAIN THE
SAME ALL TIME. HOWEVER, BASED ON THE PRODUCT PERFORMANCE, THE
PRICE OF THE KAWAII ERASERS CHANGED FROM $5.00 EACH DOWN TO $2.50 (2
ERASERS FOR $5.00). ALSO THE PRICE OF THE KEY RING CHANGED FROM
$4.00 DOWN TO $3.50. THESE CHANGES HAD A GREAT EFFECT ON THE
ESTIMATE PROFIT AND LOSS CALCULATION THAT WAS CALCULATED BEFORE
THE ENTERPRISE WEEK. IN FUTURE, THESE CHANGES NEED TO BE TO TAKEN
INTO CONSIDERATIONS BEFORE MAKING ANY PRICES TO AVOID THE LOSS IN
BUSINESS REVENUE......................................................................................................57
FUTURE DATA CALCULATIONS (APPROXIMATE PREDICITONS)............................57
APPENDIX 1 - OPERATIONS PLANNING CHECKLIST.................................................58
OPERATIONS PLANNING CHECKLIST..........................................................................58
MANUFACTURING INDUSTRY........................................................................................58
RETAIL INDUSTRY...........................................................................................................58
SERVICE INDUSTRY........................................................................................................58
CONTRACTING.................................................................................................................58
FIXED ASSETS.................................................................................................................58
LOCATION OF EXISTING/SUITABLE SITE....................................................................58
BUILDINGS/ IMPROVEMENTS REQUIRED....................................................................58
PLANT/EQUIPMENT REQUIRED.....................................................................................58
(LEASING OR PURCHASING?).......................................................................................58
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13. FIXTURES/FITTINGS REQUIRED....................................................................................58
(LEASING OR PURCHASING?).......................................................................................58
*..........................................................................................................................................58
*..........................................................................................................................................58
*..........................................................................................................................................58
*..........................................................................................................................................58
*..........................................................................................................................................58
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*..........................................................................................................................................58
*..........................................................................................................................................58
*..........................................................................................................................................58
*..........................................................................................................................................58
*..........................................................................................................................................58
*..........................................................................................................................................58
*..........................................................................................................................................58
INVENTORY......................................................................................................................58
RANGE OF STOCK REQUIRED......................................................................................58
SOURCES(S) OF SUPPLY...............................................................................................58
METHOD & FREQUENCY OF PURCHASING.................................................................58
STOCK VALUATION METHOD........................................................................................58
STORAGE & MOVEMENT OF STOCK............................................................................58
STORAGE FACILITIES REQUIRED.................................................................................58
*..........................................................................................................................................58
August 2010 The Small Business Plan for Made for Mizzi Page 13
18. *..........................................................................................................................................60
EXTERNAL ADVISORY BODIES.....................................................................................60
QLD DEPT. OF INDUSTRY DEVELOPMENT..................................................................60
COMMONWEALTH DEPT. OF INDUSTRY, ....................................................................60
TECHNOLOGY & COMMERCE......................................................................................60
NATIONAL INDUSTRY EXTENSION SERVICE..............................................................60
(NIES)...............................................................................................................................60
STANDARDS ASSN. OF AUSTRALIA.............................................................................60
AUST. ORGANISATION FOR QUALITY CONTROL.......................................................60
AUSTRALIA FOR QUALITY ORGANISATION................................................................60
INDUSTRIAL DESIGN COUNCIL.....................................................................................60
INDUSTRY TRADE ASSOCIATION.................................................................................60
INDUSTRY TRAINING COMMITTEES.............................................................................60
DISTRIBUTORS, AGENTS & BUYING GROUPS............................................................60
PROFESSIONAL CONSULTANTS .................................................................................60
(CONTACTS AVAILABLE THROUGH SBDC)..............................................................60
*..........................................................................................................................................60
*..........................................................................................................................................60
*..........................................................................................................................................60
*..........................................................................................................................................60
*..........................................................................................................................................60
*..........................................................................................................................................60
*..........................................................................................................................................60
August 2010 The Small Business Plan for Made for Mizzi Page 18
20. KAWAII ERASERS............................................................................................................61
PRODUCT NAME..............................................................................................................61
QUANTITY.........................................................................................................................61
ORIGINAL PRICE PER UNIT............................................................................................61
TOTAL ..............................................................................................................................61
1 SET OF COOKIES ERASERS (6 PIECES)...................................................................61
6..........................................................................................................................................61
$1.46..................................................................................................................................61
$8.77..................................................................................................................................61
1 SET OF CAKES ERASERS (6 PIECES).......................................................................61
6..........................................................................................................................................61
$1.46..................................................................................................................................61
$8.77..................................................................................................................................61
TOTAL...............................................................................................................................61
12........................................................................................................................................61
$17.53................................................................................................................................61
1. Introduction
This business report will cover the Marketing, Operational and financial planning’s of ‘Made for
Mizzi’ as well as Market research and Competitive analysis. Based on the following findings and
data analysis, an accurate future out look for the organisation can be made. Made for Mizzi has a
business ownership that consists of an equal relationship between Andrea Mizzi, Sam Messmer
and Chan Richardson.
August 2010 The Small Business Plan for Made for Mizzi Page 20
21. The product/service we will be offering are hand made caricature plush key rings, visually
appealing Japanese erasers and unique imported IPod cases (all at a reasonable price).
Our goals are to have a positive and popular reputation within the community for selling quality
products. We also aim to continual increase the bottom line of our organisation, whilst maintaining
a strong relationship with our consumer base.
Eventually ‘Made for Mizzi’ plans to expand the business to the global community through an
online market (E-business).
August 2010 The Small Business Plan for Made for Mizzi Page 21
22. BUSINESS SUMMARY
2.1 Background and Description of Business:
Made for Mizzi, is a new, exciting retail business located in the Cairns CBD. The owners of this
business are 3 young its main products are IPod cases however the business is also selling
Japanese erasers and key rings. The business would like to focus on selling iPod cases
therefore our vision would be to make a name for selling good quality iPod cases and increase
our range of cases. Our mission statement provides our business with a direction in regards to
goals and aims. (Wikipedia, 2010)
‘We aim to provide products to consumers that are unique and different, something that
stands out and is visually appealing, whilst maintaining an affordable price.’
- Made for Mizzi mission statement
A mission statement is important for a business as it formally sums up the overall objectives of a
business to consumers and also employees.
2.2 Current business/economic position and future outlook:
During the trial at business enterprise week, Made for Mizzi resulted in the highest percentage of
profit (refer to marketing plan). The main customers our business attracts are people who own
iPods (for the moment nano, iPhone, or iTouch). Through research we have discovered that we
are going to have a large customer sector as half a million teenage own a portable music device,
with iPods being the most popular. Because of our instant success we are able to plan for our
businesses future which includes expanding into the global market. Our other products are also
appealing to the older market of consumers who wish to purchase something different and
‘unique’ (putting a personal statement at office/school/work). The customer profile analysis can be
found in the marketing plan of this business report (page??).
2.3 Marketing Plan:
2.3.1 An assessment of the market potential, market share and competition including marketing
strategies for next year:
A marketing plans function is to identify the needs of consumers and to classify stakeholders and
external factors which could impact on the business’s operation. It highlights the aims and
objectives of the business’s marketing ideas for either their service, brand or product line. It also
assesses the business’s market potential, market share, competition and marketing strategies for
the next year. (Mylonas, A. 2006)
August 2010 The Small Business Plan for Made for Mizzi Page 22
23. It is important to find out our market potential to determine how much sales revenue we will
receive in comparison to our competitors. Market potential also helps us in acquiring information
on our market share, which is the sales volume of our brand and product in comparison to our
competitors. Our market share for ‘Made for Mizzi’ during our trial run of the business, was the
largest share in the merchandising business sector with a market segment of 17% (see figure 1
below). This shows that our market potential when establishing our business permanently has the
capacity to achieve in the retail sector, if we can identify who our target market is. Our strategies
to improve these figures will be to implement more advertising and promotional efforts, focus on
new ways to communicate to our target market and how to expand our market to new target
groups by expanding into more popular areas such as shopping centres where the target market
is more abundant. These marketing ideas for ‘Made for Mizzi’ will be defined, determined and
discussed throughout this section of our business plan for our expansion locally, nationally and
internationally.
2.3.2 Market size and your share by segment:
Now (3 day trial):
Made for Mizzi's profit compared to other retail stores
A
B
C
L 5% A 9% D
J 1% 8%
K B 7%
E
I 13% C 9%
F
Made for Mizzi
H 9% D 6%
E 9% H
Made for Mizzi 17% F 7% I
J
K
L
Figure 1 – Made for Mizzi’s profit contributions in comparison to other retail stores at business
enterprise week
2.4 Operational Plan:
2.4.1 Product/service and or production uniqueness and differentiation:
The success of our business can be contributed to its uniqueness and attractive personal
statement it gives to our consumers. Our products such as iPod cases are closely linked with
popular technology of these current times. Therefore they are extremely popular with its
August 2010 The Small Business Plan for Made for Mizzi Page 23
24. consumers. It could be said that consumers want a product that contradicts the organised,
straightforward approach of office and school work. By purchasing our product, they are
personalising themselves and enhancing their ‘individuality’.
2.4.2 The management team (experience, talent, and strengths):
The management team consists of Andrea Mizzi, Chan Richardson and Sam Messmer.
Combining our knowledge of the various business aspects, we are able to create an efficient and
effective business structure.
2.5 Financial Plan:
Goods were sold to 53 students in Cairns State High school out of approximately 1400 students,
which made up an approximate of 4% of sales out of the whole school population. In future, if
“Made for Mizzi” is to expand into a small business that is running in Cairns only, with the
population of approximately 142 001 people, there will be roughly 5860 people who will be
purchasing our products.
If we were to increase the numbers of our products and provided more choices for the consumers
such as more iPod Nano cases for the latest version or increase the amount of the popular stock,
the sales percentage could have been increase up to 10% of sales.
In future we will be focusing on selling such as cover cases, screen protectors and phone charm
accessories for electronic devices because during the school, they were the most popular
products. The electronic figures includes:
• Ipod products: cases and screen protector for iPod touch, iPod Nanos and Iphone;
engrave the owner’s name of the ipods and maybe laptop bags.
• Other phones accessories such as screen protectors and cases for the latest touch
phones
• Cases can be designed and customised by the consumers
• Key rings with a wider range appearances and colours.
The tables below demonstrate the cost to establish “Made for Mizzi” and the cost of goods sold.
The publishing fees will only be paid at the start when establishing the business. This fee will not
be included into the expenses later on.
Particular Cost of Expenses
Publishing fees $5,000.00
Other additional expenses $1,000.00
Rent per month $1,000.00
Phone and electricity per month $1,000.00
Total $8,000.00
August 2010 The Small Business Plan for Made for Mizzi Page 24
25. Monthly expenses
Particular Monthly Expenses
Other additional expenses $1,000.00
Rent per month $1,000.00
Phone and electricity per month $1000.00
Total $3,000.00
Cost of goods sold
Original Selling
Products Cost Quantity Total Price Revenue
Ipod touch $4.15 200 $830.00 20 4000
Ipod Nano $4.00 200 $800.00 10 2000
key rings $1.10 200 $220.00 5 1000
Machinery $1,850.00 7000
Profit $5,150.00
Net profit = $5,150.00 – 3,000
= $2,150
Projected financial results:
Sales: $ 5,150.00
Profit: $3000.00
Gross Profit: $3000.00
If this Business Plan is to be used as an application for funding:
Amount contributed by principal(s) $13,000
Additional funds required $5000
TOTAL FUNDS $18,000
2.5.2 Other comments:
The calculations above are just an estimate of possible cost to establish “Made for Mizzi”.
It has not included the activities such as engraving names on iPod and the cost for
consumer to design their on iPod cover designs. If there is no profit made at the end of
the month, the business needs to find another suppliers will cheaper goods and maybe
decrease the cost of a particular product base on its performance of the month.
Business Profile
3.1 Business Description:
3.1.1 Details your business (its name, location and purpose) and your Mission Statement
August 2010 The Small Business Plan for Made for Mizzi Page 25
26. ‘Made for Mizzi’ is a merchandising business established and trialled for three continuous days on
Business Enterprise Week. During this trial we were located in the middle of the south wall (near
the epicentre of Enterprise Week). However after our successful trial we plan to establish the
business in a more permanent location within the Cairns CBD our new location was discussed in
section 6.5 of this report. The purpose of our organisation is to sell handmade caricature plush
key rings and visually appealing Japanese erasers, however we will focus on unique imported
iPod cases – all at a reasonable price. As mentioned in section 3.1
Our unique selling proposition is:
‘We aim to provide products to consumers that are unique and different, something that stands
out and is visually appealing, whilst maintaining an affordable price.’
3.1.2 Legal Structure of Business (tick as applicable):
Sole Trader Partnership Limited Liability Co
Trust Limited Liability Partnership Other (please indicate type)
3.1.3 Legal Structure
There are many different legal structures which a business can choose, in deciding on a
particular legal structure the following factors need to be considered; taxation, liability, risk and
control, continuity of existence, transferability, expense and formality. (QuickMBA, 2010)
Our business ‘Made for Mizzi’ chose a 3 –way partnership. A partnership is a legal structure
consisting of 2 or more participants and is he most common for small business set up. Our
reason for choosing this structure include that it is simple, it is financially and legally flexible, able
to share a work load and make more effective decisions cooperatively. The contract is also
binding and partnerships do not pay tax though they must still lodge a tax return.
3.1.4 Industry Knowledge and Experience / Skills of Key Personnel:
Name Position Knowledge & Experience / Skills
Andrea Mizzi Marketing Manager Techno-savvy, sales strategies
Chan Richardson Finance Manager accounting
Sam Messmer Operations Manager Hands-on approach, mediator
August 2010 The Small Business Plan for Made for Mizzi Page 26
27. 3.1.5 Location and Description of Premises:
Our trial run of our business was held at Cairns State High school, we were located along the wall
opposite to the hall (figure 2).
O R
T E
H T
E A
R I
L
F
HALL O S
BULL RIDE O T
D O
R
& E
S
FOOD STALL
MADE FOR
MIZZI
ENTRANCE
Figure 2 – Outline of our location at business enterprise week
The premises consisted of a simple foldable table – no lease and no electricity was used,
therefore no running costs were incurred. However, if ‘Made for Mizzi’ was to expand into a more
permanent premises such as a shop front in a popular shopping centre (cairns central, CBD,
cairns square). The running costs incurred per year would be approximately $60 000 for the lease
of the premises alone (Business Essentials, 2010). Costs that would also need to be taken into
account include insurance, electricity, taxation, permit/licence costs, import/export licence costs,
ABN etc. ore information about location is discussed in section 6.5
3.2 SWOT Analysis
Strengths
The strengths of our business ‘Made for Mizzi’, outlined in the earlier SWOT analysis; are offering
a fresh and unique product to our consumers (this was the main reason for our success during
our trial period), constant profits even though changes in product prices were made, some of our
products can only be bought online - our business gives our consumers the option to buy these
items in a real life situation and reduce their risk of fraud, our products were popular amongst our
target market, established our customer base through advertising our business, products weren’t
bulky therefore were easy and low maintenance to store, materials were relatively cheap –
especially when bought in bulk will increate cost effectiveness.
August 2010 The Small Business Plan for Made for Mizzi Page 27
28. Weaknesses
Our main weaknesses were that it was very time consuming to hand make the key rings, delivery
times was extremely unreliable and suppliers were not dependable. This caused customer
dissatisfaction and loss of loyalty as the products they paid for were not available on the date they
were promised. Technological advances (IPod) caused depreciation in our goods sold (no longer
used by customers), causing a loss in finances. Because we didn’t manufacture all of the
products ourselves (IPod cases and erasers) the product availability was limited. These products
also required a large sum of capital to successfully run the business (purchasing stock).
Opportunities
Potential opportunities for Made for Mizzi include expansion into bulk buying products such as
IPod cases, erasers and materials required for the key rings. This would reduce costs and allow
us to compete with the more established organisations. Another viable option would be
manufacture the products ourselves, creating more independence and reliability increasing
customer base and satisfaction. Due to the small range of stock we would sell ‘Made for Mizzi’
would have to consider merging with another similar organisation to maximise bulk buying efforts.
As bulk buying will increase our customer base it will establish our business name and products,
therefore creating opportunities to expand nationally and international through E-business.
Threats
Threats that could impact on our business include a loss of customer base through established
competitors selling similar products. Also our established competitors have more finance options
to compete with smaller business such as Made for Mizzi. Their established name also poses a
threat to new smaller businesses as they would already have a well established customer base.
The relationship between suppliers and importers also poses threats through banking security.
Furthermore trustworthy suppliers must be sought and maintained or stock will not arrive on
schedule and financial difficulties may occur.
How will you maximise strengths, minimise weaknesses, capitalise on opportunities and
overcome threats?
For a successful business venture, especially our business segment, continual market research is
required. By being able to better understand consumers and their needs and wants, the business
is able to make relatively accurate purchasing trends – therefore assisting to maximise
profitability. Weaknesses and threats can be analysed and various solutions and improvements to
the organisation can be made, therefore decreasing weaknesses and threats, and increasing
strengths and opportunities.
3.2.6 Business Goals
Short Term
August 2010 The Small Business Plan for Made for Mizzi Page 28
29. Short term goals, are the goals the business wishes to achieve in a year or less, for our business
this includes setting-up small cost effective shop front and introduce it to the market through
continual advertisement and exposure within the target market (music events, television,
community events etc). The creation of a reputation will help to increase sales and in turn,
profitability. Initially costs of setup will outweigh sales; however it is predicted that over time the
setup debt will decrease. These initial costs would come from all three partners (probably equally)
or from a bank loan (such as the Commonwealth bank ‘small business loan’ scheme). We would
also want to improve the relationship between suppliers and the business – attempt to increase
the delivery speed and reliability, or start to look elsewhere for suppliers.
Long Term
Long term goals are those that may become out of focused as they are further into the future, 3 to
5 years. However it is important to have these goals to guide the business through its expansion.
(Weinstein, C, 2001) Our long term goals are to keep at least a 50% profit margin will help to
ensure that operating costs can be covered (currently the products were marked up
approximately 50-150%). In the future, expansion for our business will be done by setting up an
online store, therefore dramatically reducing operating costs (only a warehouse and limited staff
would be required). Depending on sales and profitability, an increase in staff could be analysed.
Another option to reduce unreliability of overseas suppliers could be to produce iPod cases
ourselves. If it was cost effective, it could also be possible to manufacture in Australia – therefore
every aspect of the product could be personally chosen by us, and by being ‘Australian made’
would also improve the reputation of the business and increase sales. Another possibility could
be to introduce an increased range of products (depending on what the market research
indicates).
3.3 Personal Goals
Personally, we would prefer to work part-time in the business, as we all plan to go to University.
However, a possibility would be to defer for 1-2 years until the business is steady and employees
can be hired. Life would be relatively time constrained, but that is not a new issue for us. The
business owners are all young and soon to become completely independent, therefore family
commitments would be assumed to dramatically reduce.
MARKET ANALYSIS - The Market & Your Position in It
Identifies, describes and analyses your target market and market share.
4.1 Describe your Products and or Services:
Products and services are what a business offers to its consumers to produce a profit and grow
the business. Products need to be appealing to the target market and can fall into one of the
following categories;
1. Consumer products
2. Business products
August 2010 The Small Business Plan for Made for Mizzi Page 29
30. Consumer products are products that have already been assembled such as convenience
products, shopping products, specialty products and much more. Business products however are
industrial products and usually used in the production of making consumer products by other
businesses these include raw materials, professional services, instillation and more.
Our business ‘Made for Mizzi’ will be offering shopping products which is apart of the consumer
products category. Shopping products are items which a consumer will usually analyse and
compare with other competitors for cheaper price or higher quality. Line, breadth and depth all
need to be considered when introducing products into the business. The product line groups
products by usage, target group or price range. Breadth is used to account for the number of
product lines within the product mix. Within our business we have decided to categorize our
product lines through usage, creating a breadth of 3
product lines which are;
1. IPod cases
2. Japanese Erasers
3. Plushie key rings
Within each product line contains different variations of
that product, this is what is referred to as the product
depth. . (Mylonas, 2007) Figure 3 explains this
concept visually. Figure 3 – Product lines, breadth and depth
The IPod’s have 2 main types Soft (silicon) cases and hard cases. Japanese Erasers
have come in the shapes of foods (e.g. Milk shakes, pizza’s etc.). Our key ring’s come in different
identities, which our target market can familiarise with. Such as Pac man and Game boys.
Products are shown in figure 4 below;
Figure 4 – products offered by Made for Mizzi
August 2010 The Small Business Plan for Made for Mizzi Page 30
31. 4.2 From your customers point of view what are you selling?
Products are far more than an item placed for sale; instead they also consist of other
intangible and tangible factors. Tangible factors include additional features, lifespan/cycle,
its concept and context. Intangible factors of a product include quality, prestige,
convenience and reputation. (Mylonas, 2007) Improving these intangible factors is what
will draw our customers to buy our product over our competitors. Therefore we have
positioned our customers to view what we are selling as more than IPod cases, erasers
and key rings instead what we are really selling to them is unique and quality products, a
more personalized consumer experience as well as our goals to maintain an Eco friendly
business as much as possible. Therefore creating customer satisfaction and building
customer loyalty. Our intangible factors will set us apart from our competitors as our
consumers will be more likely to buy from our store than a competitor as they know they
are buying products which will help support a business which has a good reputation for
quality products as well as the global community.
4.3 Are there any external (political, economic, legal, cultural, social, seasonal) factors
that may impact or affect your business and what are you going to do about it?
External factors are factors which have the potential to cause problems for a business however
they do not occur within the business itself and thus the business has no immediate control over
them. Therefore policies, practises and regulations need to be put in place to control or minimise
the effect of external factors. These external factors can be divided into 2 groups;
1. External factors which effect our business’s legal liabilities
a. Political
b. Legal
2. External factors which influence/deter potential consumers from buying our products
a. Economic
b. Social
c. Motivational
d. Seasonal
There are currently no political factors that will affect our business, however some legal factors
include copyright violation on some of our Plushie products (Game boy and Pac man as they
were originally invented by other companies). This will be solved by paying royalties to the
desired companies or alternatively inventing our own ideas for Plushies. Also the Trade Practises
Act 1974 deals with the regulating advertisement as to not mislead customers about our products
or business.
We have assessed and determined main factors that stimulate and influence our potential
customers buying patterns are economic, social, motivational and seasonal factors. Economic
factors include our potential customers’ income which can be measured in 3 different ways; gross
income, net or disposable income and discretionary income. Our business will have to review and
August 2010 The Small Business Plan for Made for Mizzi Page 31
32. access our potential customers’ income in order to ensure our products are at reasonable prices
otherwise our products will be avoided. Inflation which is linked to the global economic stability
also affects customers’ confidence when buying products especially shopping products. Inflation
also has the potential to affect our business by causing product prices to rise from our wholesaler
meaning we would have to raise our prices as well. This may sit unfavourably with our Australian
customers, as our overseas suppliers may be hit harder by the GFC than Australians, resulting in
an imbalance of trading. Social factors for business include consumers; age, class, gender,
culture, family and ethnicity. In section 4.4.2, we have identified and assessed which social
market we are aiming our product at. However within our social market the latest trends, fashion
and technology are forever changing therefore our business will periodically assess our products
and there potential to continue to succeed in the specified target market. By doing this we will
ensure that our business continues to stay in touch with our customers and provide them with
products that will continue to appeal to them. In regard to technological advancement, it has been
noted that this will definitely affect our business because of
‘Apples’ progression to making more effective IPod for their consumers, they also seem to slightly
change its shape and/or dimensions. This affects our business as we sell IPod cases and
therefore some stock may become out of date with new IPod releases. This will be managed by
assessing when to change our products to suit the majority of people who buy from us.
August 2010 The Small Business Plan for Made for Mizzi Page 32
33. The business’s strategy to access the target market includes continually conducting an in-
depth analysis of consumer’s current ‘wants’ and assisting to turn them into ‘needs’
through increasing the businesses reputation. They will be approached externally through
communications (advertisements – magazines, television, radio, events etc), there
positioning assists in developing a positive customer perception of the business in respect
to the needs of the target market. The positioning strategy is to increase business
reputation to become a well – known and popular brand that leads to consumers to
“impulse buy” and creates consumer loyalty.
4.4.Market Research
Market Research is one vital component in establishing a business; it can determine the
success or failure of a business before any considerable amount of money is spent on its
establishment. Market research can be conducted using 2 methods; Primary and
secondary research. Primary research involves more tailored research than secondary
research as it is usually conducted by the business to potential consumers. Secondary
research is collecting relevant information which has been published by other
organisations, bureaus or business’s. (All Business, 2010)
4.4.1 What Research have you done to investigate the following?
Made for Mizzi will use both types of market research to conclude if our business has a chance at
establishing and staying established in the retail sector. To ensure the accuracy of our marketing
strategy, we have undertaken various primary market research, including surveying high school
students aged 13 – 17 on which products they would most likely buy, the price expectancy and
the types of iPods they own. (a copy of the survey can be found in the appendix). Before we
started our trial run of our business ‘Made for Mizzi’ we surveyed students attending Cairns State
High School, to find out which products attract what type of market segment.
4.4.2 Business Environment
The results concluded from our market research can be seen clearly in the graph below (figure 5
& 6); Figure 5: Junior Market Segment Figure 6: Senior Market Segment
Junior; Product m ost likely to buy Senior; Product m ost likely to buy
3.5 8
3
2.5 6
2
4
1.5
1 Male Male
2
0.5 Female Female
Female Female
0 Num be r o f 0 Num be r o f
Male Male
Ipod pe o ple
Ipod pe o ple
Earasers Earasers
cases Keyrings Keyrings
cases
P ro d uc t s P ro duc t s
August 2010 The Small Business Plan for Made for Mizzi Page 33
34. We can see that in the junior segment of the school IPod cases were favourable amongst both
girls and boys this was also reflected in the senior segment of the school. Comparing both girls
and boy across both senior and junior segments, our keying and eraser products were more
favourable amongst girls than boys.
Therefore we concluded that our target market will mostly be girls between the ages of 13 – 18.
By targeting a specific market allows us to plan an effective marketing strategy.
August 2010 The Small Business Plan for Made for Mizzi Page 34
35. 4.4.3 Who are my potential customers?
Potential customers are those who can be identified as most likely to buy products of a
business. As stated above, from our market research we concluded that girl’s aged13 – 18
were most likely to be our potential customers. However our target market also includes
boys aged between the same ages because of our IPod cases which proved to be
successful both in the market research survey (figure ?) and from our sales in the trial
period of our business (figure ? – page ??). Our potential customers will play a much
greater role than purely being customers within our business, they will also provide us with
feedback about our products, pricing and overall business to help in the decision making
process of our business. This will be undertaken to help our business make correct
decisions to suit our customer base.
4.4.4 What do I know about my competitor activity?
Our major competitors include most merchandising businesses at enterprise, such as
Quirky Tools. Externally our major competitors include larger retail stores which already
sell similar products such as IPods and Plushies, these retail stores would include stores
like target, Smiggle and Big W. Our competitors offer a wide range of products at
financially conscious price. This is one of the key advantages our competitors have over
our company. As their large product range allows them to draw a larger range of
customers while satisfying our target markets wants (it contradicts the organised straight
forward of office and school work by offering a unique and attractive statement). Other key
strengths they show are they are a well established business. However their strength of
being a large established business can also be seen as a weakness compared to ‘Made
for Mizzi’. As we perceive this as their business would be unable to connect to their
customers on a personal level as other small business’s can. We plan to compete against
their strengths and capitalise on their weaknesses by marketing our products at a lower
cost and adding a community feel to our business. By maintaining a small business we
are able to analyse their strengths and maintain flexibility in decision-making, therefore
improving our bottom line. By effectively position the business as more than just a place
to buy products but to create a community through our online website. Our business will
also focus on giving back to our customers through helping the environment and other
community work.
4.5 Market Segments
4.5.1 Describe the different groups of customers (segments) that make up your total market:
Customer segmentation is dividing up groups of customers into segments in order to find links or
connections that may influence them in buying products. Segmenting can be done through either
August 2010 The Small Business Plan for Made for Mizzi Page 35
