business plan
TRANSCRIPT
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University of Greenwich, Business School
MA Events Management
Innovation, Enterprise and Winning the Bid (BUSI 1436)
Group Business Plan
Authors:
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Introducing EventsProfessional
The one-‐stop networking, professional development and job vacancy site for event
professionals in the UK
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CONTENTS
1. OPERATING PLAN 1.1. Production process 1.2. Payment methods and terms 1.3. Suppliers 1.4. Premises 1.5. Equipment 1.6. Legal requirements 1.7. Management and staff 1.8. Action plan
2. MARKETING PLAN 2.1. Pricing strategy 2.2. Marketing strategy 2.3. Sales strategy 2.4. Marketing risks
3. FINANCIAL PLAN 3.1. Sales Forecast 3.2. Expenses Budget 3.3. Cash Flow Statement 3.4. Income Projections 3.5. Break-‐even analysis
4. REFERENCES
5. APPENDIX
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OPERATING PLAN
1.1. Production process
Development of a professional website requires reference to guidelines and a sufficient
timeframe (Phan, 2003). The process will start with brand identity development and
website/mobile application design. Concurrently staff will prepare the website content and
confirm rights for using information. All information will be passed to developers and
negotiation with potential customers will begin. After the website has been launched it will
be advertised according to the marketing plan.
1.2. Payment methods and terms
EventsProfessional members and customers will have choice of payment methods. The
following credit and debit cards can be used as online payment: Visa, Delta, MasterCard,
American Express, UK based Maestro and Solo. The company will also accept PayPal and
bank transfers. There will be no additional charge for purchasing the App. The subscription
fee will be charged in full
Refunds
Membership is on annual basis
The fee for registering is non-‐refundable.
Should advertisers wish to cancel they must contact customer services. The decision will be
made based on contract conditions.
1.3. Suppliers
Website and App development
Red Evolution provides packages that include Website development, mobile application
development and search engine optimization. The required package price is £10 000, and
the payment method will be negotiated prior to the contract being signed
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Red Evolution (Aberdeen) Ltd
7 Waverley Place
Aberdeen, UK
AB10 1XH
Tel 012224 443 551
www.redevolution.com
Website hosting
Hostpapa provide different plans and options for website hosting. The most suitable plan
costs £201.72. This provides easy access and navigation, unlimited options, 24/7 support
and a 30-‐day money-‐back guarantee. The contract would be for 36 months
Hostpapa
www.hostpapa.com
Tel 0800-‐051-‐7126
Database CRM System Software
Salesforce provide CRM software that will store customer information and historic contact
and marketing information. The Professional package, which includes customised
dashboards, forecasts, mass emails, products, quotes and orders information costs £45 per
user per month. If billed annually, based on three staff, the cost will be £1620.
Salesforce.com EMEA Limited
Village 9, floor 26 Salesforce Tower
110 Bishopsgate
London
EC2N 4AY
Tel 08000 0921223
http://www.salesforce.com
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1.4. Premises
EventsProfessional will operate using a virtual office (www.yourvirtualofficelondon.co.uk).
This provider will assist with finding business addresses for mailings, business meetings and
includes a professional PA team who will answer telephone calls on behalf of the company.
The 12-‐month package is £367.50.
1.5. Equipment
Item Quantity New or second-‐hand
Supplier Price
Computers 3 New Apple www.apple.com
£900 x 3= £2700
Mobile phones-‐ Samsung Galaxy Core Prime
3 New Carphone Warehouse http://www.carphonewarehouse.com
£110 x 3 = £330
Tablet-‐ iPad Air
2 New Apple www.apple.com
£319x2 = £638
Furniture -‐ Table
1 New Discount Displays http://www.discountdisplays.co.uk
£60
Roller banner 2 New 4imprint http://www.4imprint.co.uk
£75 x 2= £150
1.6. Legal requirements
Necessary licences need to be obtained to acquire and publish information from different
sources (Copyright Licensing Agency). A Website Republishing Licence is required to post or
use articles on the website. Prices start from £57 and fee will depend on the total amount of
information. In addition a Web End User Licence will allow the republishing of copyright
material. Prices start from £105 per staff.
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1.7. Management and staff
Name Department Responsibilities
Salary
Elisa Serandrei Thais Serrano
Business development
Research and Identify potential clients and build relationship with new clients
Identify opportunities for campaigns, services, and distribution channels that will lead to an increase in sales.
Plan approaches and pitches
Submit weekly progress reports and ensure data is accurate
Ensure that data is accurately entered and managed within the company’s CRM or other sales management system
Forecast sales targets and ensure they are met by the team
Liaising with suppliers
£30 000 pa £30 000 pa
Natalia Dimitrova Marketing Sourcing advertising opportunities and placing adverts
Managing the production of marketing materials and liaising with designers and printers
Conducting market research
Managing budgets
Evaluating marketing campaigns
Monitoring competitor activity
£30 000 pa
Nicola Rowe Finance Managing a company's financial accounting, monitoring and reporting systems Monitoring and interpreting cash flows and predicting future trends
£30 000 pa
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Producing financial reports Managing budgets
Irina Bairamian Sales Cold calling to arrange meetings with potential customers Negotiating prices and conditions and signing contracts Reviewing sales performance against target
£30 000 pa
(Job descriptions taken from Prospects, 2015)
1.8 Action Plan
As highlighted in Table 1 the first step will be to register the business, which will take
approximately seven days. The main priority at this stage will be to obtain copyright
licences, which may take up to 30 days. Alongside this work on brand development will
begin. A time limit of 21 days has been set for design (logo, website, app and stationery).
Development of the website and mobile application is extremely important. When the
brand design is ready website development will start. It is estimated that it will take 21 days
to fill the website with content, complete the integration of the interface and basic
functions. The next step will be to test and launch the website and this will take between 3-‐
5 days. Brand registration can take up to eight months and therefore the EventsProfessional
website will launch with registration in the process. The company will be taking a risk by
doing this however this is outweighed by the potential reward of securing customers. After
website is launched the team will begin promoting EventsProfessional the using marketing
plan.
The complete process of establishing the business and website development will take
approximately three months.
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Table 1. Timeframe for development
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MARKETING PLAN
1.1 Pricing strategy
Pricing is a vital element of any successful marketing strategy (Kotler and Armstrong, 1991).
Rather than choosing a mark-‐up to the acquisition costs or merely offering similar prices to
our competitors, EventsProfessional’s strategy will be to create brand awareness, quick
market share acquisition and value-‐added service positioning.
To begin with there will be an aggressive penetration pricing strategy with free sign-‐ups and
free three month trials of premium services to attract customers. Once a target of 5,000
users and 1,000 premium customers has been achieved there will switch to competitive
pricing strategy with a two-‐week free trial period only.
Table 1. Subscription tariff Subscription category Yearly fee
Professionals £70
Students £40
By offering free content, webinars, newsletter, tips and mentoring services
EventsProfessional will showcase the value of the premium services, and will introduce the
concept of social network sharing and an expert base platform for professional networking.
The aim will be to increase both the perceived value of the services and to increase the
actual value by encouraging full sign-‐up. Our premium service will allow contact via emails
or web messages between members and suppliers thereby instigating networking. Paying
customers will have the access to mentors, special invite-‐only industry groups, access to
discount prices, job opportunities and exclusive offers. They would also benefit from
introducing their own brands and sell events directly to the specially targeted audiences
within the social network.
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An additional income stream would be generated by charging event suppliers (e.g. catering,
merchandise, design companies) a fee of £5 per month to advertise within the suppliers
section of the website.
1.2 Marketing strategy
Based on research, market and competitors analysis and the profile of potential customers
the marketing strategy will focus on initially entering the business social network market as
a hybrid of freemium and premium services aimed at professionals within the events
industry. The aim will be to capture 5% of the market share in the first year. Based on the
industry data, 600,000 people are employed in the events industry within the UK, of which
approximately 10% are in managerial positions (Labour Market review of the Events
industry, 2010). Additionally there are 28,000 event management graduates per annum
(CHME, 2011), and industry year-‐on-‐year growth is calculated at 18% with industry revenues
accounting for £22 billion. Competing against other social networks, EventsProfessional’s
proposition is for targeted and meaningful professional connections that bring real value to
event industry professionals.
The marketing mix will include:
-‐ Product: responsive design website and native app
-‐ Place: online and mobile platform
-‐ Price: hybrid of freemium and premium packages
-‐ Promotion: reaching customers via online advertising, PR, word of mouth, referrals, social
media (twitter / FB / blogs), event industry professional forums, direct emails
This marketing strategy will enable EventsProfessional to establish the most suitable pricing,
distribution, and promotional strategies and allow the company to become profitable within
a competitive environment (Kotler, 1988).
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1.3 Sales strategy
The sales strategy (Porter, 1979) will be developed to bring new customers and to increase
the value spend of the existing customer database. We will offer a mix of free and premium
paid services, premium content and referral sales and generate a separate revenue stream
from targeted advertising. Customers who sign-‐up for free will have access to customised
content, ads and event industry information, which will be available for referral and direct
purchases. Existing customers will be upgrade to professional membership and enjoy the
benefits of exclusive products and services available to them. Premium customers will have
access to exclusive offers, job positions, promotions and sales that are offered by businesses
and other event organisers. Our social networks will offer a free platform to increase brand
awareness and company engagement. Businesses can utilise the platform tools to
communicate and refer information on particular products or services on their social
network pages.
1.4 Marketing Risk
Potential risk to the business could be changes in the macro and micro environment, for
example, new aggressive market entrees resulting in a higher investment need in marketing
(Cooper, 1993). Currently, social networks are not greatly affected by legal regulations, but a
stricter information gathering and privacy policy could be introduced with regulatory
guidance posing a potential threat to the social network business model. A further threat
could be the more aggressive expansion of advertising networks run by Google, Linkedin,
Facebook which may affect price elasticity and decrease the interest of customers to use
specialised networks.
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FINANCIAL PLAN 1.1 Sales forecast
The target market for EventsPlanner consists of approximately 630,000 individuals, of which
circa 5% are current students. As mentioned in the marketing strategy a web and social
media campaign will be used to recruit subscribers. It is expected that in the initial months
subscribers will be drawn from higher education establishments. These will be targeted in
September as this is the start of the academic year, suggesting undergraduate students
would be keen to use the site’s facilities to assist with coursework and information and any
student loans received would not be depleted. Additionally postgraduate students usually
complete their courses in September and would be encouraged to join whilst still benefiting
from the student tariff and to assist with job hunting. Figures have been calculated based on
recruiting 5% of all event management students over the course of the year.
As the year progresses and the site becomes more widely known subscriptions from event
professionals will increase. Peak sign up times will coincide with EventsProfessional
exhibiting at trade shows and conferences which tend to take place between March and
June (Krugman and Wright, 2007). As an initial three month free period will be offered no
income has been calculated for this group for the first quarter. Sales figures have been
calculated based on recruiting 5% of event managers (which account for 10% of the total
number of event employees) over the course of the year.
As for advertising figures it is expected that the sales team will work on these throughout
the year and that income will grow at a steady rate. For year one projections it is expected
that advertising revenue will be relatively modest and would not start to grow considerably
until the site has gained popularity and potential advertisers have evidence of the number
of subscribers.
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Table 1. Year One Sales Forecast
Period Source No of subscribers
Cost per subscription Totals (£)
Total per quarter (£)
Quarter1 Students 800 40 32,000
32,075 Professionals 200 0 0 Advertisers 15 5 75 Quarter2 Students 300 40 12,000
47,125 Professionals 500 70 35,000 Advertisers 25 5 125 Quarter3 Students 100 40 4,000
109,175 Professionals 1,500 70 105,000 Advertisers 35 5 175 Quarter4 Students 200 40 8,000
64,225 Professionals 800 70 56,000 Advertisers 45 5 225
Year total 252,600 1.2 Expenses Budget
For EventsProfessional to begin trading several start up costs need to be accounted for. As a
web-‐based business costs will be reduced by utilising a remote office environment.
Employees will each work from home to begin with and access shared files using Cloud
based technology. As the business grows office space will be obtained and new costs such as
rent, utilities and furniture will need to be accounted for.
It is estimated that £30,000 is required to fund this venture (items in Table.2 less salaries,
National insurance, tax, loan repayment and mobile telephone monthly contracts).
Shareholders will each contribute £2,000 and the remaining £20,000 is dependent on a
small business loan, crowd funding or an outside investor.
Loan repayments have been calculated based on borrowing £20,000 over a five-‐year period
at an interest rate of 10%.
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Table 2. Year one expenses budget, including start up costs
Item Category Monthly cost (£)
Annual cost (£)
Salaries Staff expense 12,500.00 150,000 NI contributions Staff expense 1,725.00 20,700 Corporation tax Legal NA 50,500 Website publishing licence Legal NA 57 Web end user licence Legal NA 105 Loan repayment Legal 425 5,100 Website development Start up NA 10,000 Computers Start up NA 2,700 Mobile telephone Start up NA 330 Tablet Start up NA 638
Website hosting Operations expense NA 202
Database software Operations expense 135 1,620
Virtual office Operations expense NA 368
Mobile contract Operations expense 95 1,140
Print materials Marketing NA 3,000 Banners/trade show materials Marketing NA 210 Trade show attendance Marketing NA 2,500 Web campaign Marketing NA 2,000 Social media campaign Marketing NA 1,000
TOTAL 252,170
1.3 Cash Flow Statement
Cash flow estimates have been calculated using a figure of £30,000 for the initial
investment. This and the start up costs have been included alongside subsequent income
and expenditure per quarter (Figure.1). Gross margin represents the figure of income less
expenditure and net profit is calculated using this minus tax requirements (Weetman, 2006).
The figures highlight a loss will be made for the first two quarters but as the business
establishes itself amongst the events management profession revenues will grow. Longer-‐
term forecasts for income projection in the next section highlight the viability of
EventsProfessional.
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Figure 1. Year One Cash Flow
1.4 Income Projections
Income projections for the first year suggest a modest profit of £430. This figure includes
payment of all start-‐up expenses and it is estimated that based on a 5% growth projection
net profits will increase healthily in years two and three (Figure 2).
Figure 2. Three-‐Year Income Projections
-‐40,000
-‐20,000
0
20,000
40,000
60,000
80,000
100,000
120,000
Start up Quarter1 Quarter2 Quarter3 Quarter4
Income
Expenditure
Gross Margin
Net profit
0
100000
200000
300000
400000
500000
600000
Year1 Year2 Year3
Income
Expenditure
Net Profit
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If a profit is maintained the company would look to invest in new premises, expand the
marketing campaign and hire additional staff
1.5 Break Even Analysis
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References
BVEP (2010). Labour Market review of the Events industry. Available:
http://www.businessvisitsandeventspartnership.com (accessed: 19 March 2015).
Cooper, A.C. (1993). Challenges in predicting new firm performance. Journal of Business Venturing. 8, (3), 241-‐253.
Copyright Licensing Agency (2015). Available at
http://www.cla.co.uk/licences/webrepublishing (accessed 21 March 2015).
HESA (2011), CHME Report on Hospitality Higher Education in the UK, 2011, Available at:
http://www.chme.org.uk/files/public/Publications/CHME_Report_on_Hospitality_Higher
_Education_UK_2011.pdf (accessed: 19 March 2015).
Kotler, P. (1988). Marketing Management: Analysis, Planning, Implementation and Control.
(6th Ed). Prentice Hall: Englewood Cliffs, NJ.
Kotler, P. and Armstrong, G. (1991). Principles of Marketing. (5th Ed). Prentice-‐Hall:
Englewood Cliffs, N.J.
Krugman, C. and Wright, R. R. (2007). Global Meetings and Exhibitions. New Jersey: John Wiley & Sons Inc.
Porter, M. (1979). How Competitive Forces Shape Strategy. Harvard Business Review,
(March-‐April), 137-‐145.
Phan, D. D. (2003). E-‐business development for competitive advantages: a case study. Information and Management, 40, (6), 581-‐590.
Prospects (2015). Available at www.prospects.ac.uk (accessed 19 March 2015).
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Rae, D., 2007. Entrepreneurship from opportunity to action. Palgrave Macmillan: Hampshire.
Trademark Registration (2015). Available at:
http://www.uktrademarkregistration.co.uk/trademark-‐registration/Trademark-‐
Registration-‐How-‐long-‐des-‐it-‐take.aspx (accessed 18 March 2015).
Weetman, P. (2006). Financial Accounting an Introduction. (4th Ed). Pearson Education Limited: Essex.
Appendix