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Sample Marketing Plan - Hanna Wash Australia Pty Ltd

Hanna Wash AustraliaSample Marketing Plan

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Please note: This is a sample marketing plan and the names, locations and numbers contained herein are for example purposes only.

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www.hannawash.com.au 1

http://www.hannawash.com.au/


Confidentiality AgreementConfidentiality Agreement

The undersigned reader acknowledges that the information provided by ____________________________ in this Marketing Plan is confidential; therefore reader agrees not to disclose it without the express written permission of ____________________________________.

It is acknowledged by reader that information to be furnished in this marketing plan is in all respects confidential by nature, other than information which is in the Public Domain through other means and that any disclosure or use of same by reader, may cause serious harm or damage to _____________________.

Upon request, this document is to be immediately returned to:

______________________________________

________________________________ Signature

________________________________ Name

________________________________ Date

This is a marketing plan – it does not imply an offering of securities.




Table of ContentsTable of Contents

1.0 Executive Summary

2.0 Situation Analysis2.1 Market Summary

2.1.1 Market Demographics2.1.2 Market Needs2.1.3 Market Trends2.1.4 Market Growth

2.2 SWOT Analysis2.2.1 Strengths2.2.2 Weaknesses2.2.3 Opportunities2.2.4 Threats

2.3 Competition2.4 Services2.5 Keys to Success2.6 Critical Issues

3.0 Marketing Strategy3.1 Mission3.2 Marketing Objectives3.3 Financial Objectives3.4 Target Marketing3.5 Positioning3.6 Strategy Pyramids3.7 Marketing Mix3.8 Marketing Research

4.0 Financials, Budgets and Forecasts4.1 Break-even Analysis4.2 Sales Forecast4.3 Expense Forecast

5.0 Controls5.1 Implementation Milestones5.2 Marketing Organisation5.3 Contingency Planning




1.0 Executive Summary

Hanna Car Wash and Café (HCWAC) will be the prominent car wash for luxury vehicles in East Melbourne, Victoria. The Director of the business is Mr. John Smith, a successful business operator who has worked in the Car Detailing business for over 10 years. Having operated from his workshop in East Melbourne for this time, John has developed a loyal clientele and is well respected by his business peers.

It is envisioned that people will come HCWAC not only to have their cars washed and detailed, but also for a coffee and snack break. Alternatively, clients will leave their cars at the site whilst shopping or at appointments within the vicinity.

HCWAC will be based in East Melbourne, VIC. This area has a number of benefits in terms of the market it will provide for the business. Over 40% of households in the immediate neighbourhood earn over $70,000 annually, providing a large market for up-market hand car washes. John himself has run successful businesses over the span of 25 years, proving very skilled and experienced in all matters relating to management and business operations.

HCWAC will have 35% market share of Hand Car Wash business in the vicinity by the end of year three, and aims to convert a larger percentage of people away from machine and self-serve car washes. HCWAC will maintain a 95% gross profit margin and make 11% net profit margin after 12 months of operation.

Table: Sales Forecast

Sales Forecast 2005 2006 2007IndividualsBusinesses

$76,086$6,431

$123,033$8,776

$165,662$9,988

Total Sales $82,517 $131,809 $175,650

Direct Cost of Sales 2005 2006 2007IndividualsBusinesses

$3,804$322

$6,152$439

$8,283$499

Total Cost of Sales $4,126 $6,590 $8,783




2.0 Situation Analysis

HCWAC is entering their first year of operation. The owner believes that a comprehensive marketing strategy will be key to the success of the business. HCWAC offers a premium hand car washing service within a funky, attractive premises offering coffees and light snacks.

2.1 Market Summary

HCWAC possess good information about the market and knows a great deal about their target customers. This information will be leveraged to better understand who is served, their specific needs and how HCWAC can better communicate with them.

Table: Market Analysis

Potential Customers Growth 2005 2006 2007 2008 2009 CAGR

IndividualsBusinesses

12%1%

43,0009

48,1609

53,9399

60,4129

67,6619

12.00%0.00%

Total 12.00% 43,009 48,169 53,948 60,421 67,670 12.00%

2.1.1 Market Demographics

The profile for HWCAC target customer consists of the following geographic, demographic and behaviour factors:

Geographics

The immediate geographic target is East Melbourne, VIC. A 25 km radius is in need of the service, however 87% of the

business will be from within a 7 km radius. The total targeted population is just over 43,000.

Demographics

Male:Female – 63%:37%. The reason for this discrepancy in the ratio is generally explained by the fact that men typically care more about their vehicles. Men are more likely to spend money on accessories and add-ons, whereas most women view their cars as a




utility. Also, there are more men with company vehicles, that may need to be kept clean as a requirement for their organization.

40% of households earn over $70,000. 73% of the target population have Tertiary Education of some sort.

Behaviour Factors

43% of the target market lease their cars. Individual and family image is personified by the type and condition

of the vehicle they drive.

2.1.2 Market Needs

HCWAC is providing the market with a premium hand car wash service for the East Melbourne community. HCWAC seeks to fulfill the following benefits that are important to the customers:

Exemplary customer service – The target customers have money and are used to receiving excellent customer service. They will generally not use the wash again if they don’t get the service they are used to.

High quality washes – The target market value a higher quality was for their upper-end cars.

Convenience – The hours of operation, as well as the time needed to provide the service, must be convenient and fast respectively, in order to gain market share.

2.1.3 Market Trends

The market trends for the car washing industry has been a gravitation from hand washing to automatic washing machine facilities. This trend has been fuelled by the progression of technology. The automatic washing machines have become more efficient and less expensive over the past 10 years to the point that it is typically very cost effective to invest in these machines.

Although this can be viewed as perhaps leading to a downturn in the need for hand washing, a good percentage of the general community still understand that a hand wash is a superior method of having their vehicle cleaned thoroughly. Other reasons may include that some people are not able to, or don’t wish to, use the self-serve car washes that are available to them. East Melbourne’s community are considered ‘upper-end’ – more expensive vehicles than the average, and more willing to invest the little bit extra in having them hand washed.




Market Forecast:

2.1.4 Market Growth

The car washing market has seen steady 4% growth for the last six years. 4% growth is forecast for the next four years.

Target Market Growth:




2.2 SWOT Analysis

The following SWOT analysis captures the key strengths and weaknesses within the company, and describes the opportunities and threats facing HCWAC.

2.2.1 Strengths

Good relationships with many prospective customers in the target market.

Strong family name recognition in the community. Well trained employees. Director has sound background and understanding of business.

2.2.2 Weaknesses

The need for reliance on outside investors. The learning curve associated with entering an industry without direct

prior knowledge or experience. The requirement to have a constant volume of business to support the

necessary service staff.

2.2.3 Opportunities

Participation within a steadily growing industry. A high likelihood of repeat business. The ability to decrease fixed costs as a percentage of an individual sale

as volume increases.

2.2.4 Threats

Future/potential competition from a franchised firm. A slump in the economy, reducing discretionary spending. The perception that there is not a difference in quality between a

machine wash and a hand wash.

2.3 Competition

There is one other car wash in East Melbourne. It is quite new and is trying to compete with the automatic car washes by offering low prices. However it is not targeting the consumers who seek quality cleaning.

The customers HCWAC is targeting have their cars washed based on the quality of the job. They do not mind spending a little more each week to have their car washed and waxed in order to keep the paint work in excellent shape. The businesses that HCWAC targets will be more cost conscious, so prices will be approximately 30% less to promote volume usage.




2.4 Goods & Services

HCWAC will provide the following goods & services:

Car washing – exterior Car washing – interior Car detailing Fully operational Café

2.5 Keys to success

HCWAC keys to success are:

High quality car wash service Benchmarked customer service Convenience

2.6 Critical issues

HCWAC is still in the speculative stages as a start-up organization. It’s critical issues are:

Continue to take a modest fiscal approach, expand at a reasonable rate, not for the sake of expansion, but for economic reasons.

Build brand awareness, increasing the customer base and developing brand equity.

Establish HCWAC as the premier hand car wash in East Melbourne.

3.0 Marketing Strategy

The marketing strategy will be to develop brand equity, increase customer awareness of HCWAC, and build the customer base. This strategy will use several different methods to achieve these goals.

3.1 Mission

The mission of HCWAC is to provide top-quality washing and detail service for luxury car owners in East Melbourne, VIC. HCWAC will work to keep employees satisfied in order to maintain impeccable customer service.

3.2 Marketing Objectives

Increase repeat customers by 4% a quarter. Steadily increase market share every quarter. Develop brand awareness and acceptance, quantified by a decrease in

customer acquisition costs.




3.3 Financial Objectives

Increase the profit margin by .5% a quarter. Achieve a double digit growth rate each year for at least the first three

years. Develop efficiencies in the delivery of the service through advanced

training and workflow analysis.

3.4 Target Marketing

HCWAC segments it’s customers by type of car ownership. HCWAC believes that the type of car that a person owns says volumes about their driving and therefore their car washing and detailing requirements.

New car owners – Owners of newer cars are most likely to use a hand car washing service. These owners take great pride in their cars and will bring them often to the wash and detailing service. The aim is to inform these customers that HCWAC will keep their vehicle looking every bit as good as it did the day it drove out of the car sales yard.

Older luxury car owners – These people have either owned their high-end luxury cars for several years or are unable to afford the expense of a new luxury car but want the feel of relaxed driving. Both these groups of clientele want to keep their cars in the best shape possible. Those who have bought second hand cars will often spend many hours in their cars, and will place high importance on keeping their cars looking good. These owners will bring their cars in for regular washes and occasional details.

Sports car owners – These people are often younger or middle-aged and will regard the look of their car as important. They pride themselves on the look of their car, and will most often have their car hand washed weekly. These drivers will have an occasional detail, but generally keep their cars so clean that a detail is not normally necessary.

Lifetime owners – Many of these clients have owned their cars for more than five or six years and are more likely to be women. They are attached to their cars as friends and thought it may be sensible for them to purchase a new car, they will bring their car in for a wash occasionally, just when it is dirty. They want their cars to remain presentable, but are not tied to the look of their car. For this reason, they will generally not have the car detailed unless they are selling it.

Dealerships – There are five new and used car dealerships within three miles of the proposed location of HCWAC. These dealerships use outside car wash services to detail their vehicles before they are put up for sale. In addition, there are fifteen other car dealerships located within a seven km radius of HCWAC.

Local Businesses – Some local businesses have fleets of cars and small vans that must be kept clean to maintain their company image. These businesses will be looking for a cost effective, efficient car washing service to perform this duty, and will prefer to use a car wash service during the week rather than on weekends, like the general public.




Please note that for analysis purposes in regards to the charts and graphs, the different segments will be grouped into individuals and businesses. This has been done to allow the charts and graphs to have a clean look that will aid in the ability to quickly discern information from them.

3.5 Positioning

HCWAC seeks to position themselves as the premier hand auto washing service provider in the East Melbourne area. This positioning will be achieved by leveraging their competitive edge.

HCWAC’s competitive edge will be gained through the reputation of the Director and his name throughout the area. Branding and marketing of the car wash will be a priority, and the Director once again has a myriad of experience in this area, through other businesses he has operated and sold in the past.

Lastly, by purchasing a quality conveyor through a very reputable Australian supplier, HCWAC will place an emphasis on creating a fast, no hassle system for the client.

3.6 Strategy Pyramids

The single objective is to position HCWAC as the premier automobile hand washing company in the area, steadily increasing market share. The marketing strategy will seek to first create customer awareness, develop a customer base, and work toward building customer loyalty.

The message that HCWAC will seek to communicate is that their hand washes are superior to a machine wash alternative. The message of convenience will be communicated through several different methods: the placement of advertisements in the local newspaper, which is well read and will reach a large portion of the targeted community; networking and leveraging the Directors substantial customer base from his previous businesses; and lastly a ‘marketing pyramid’ through the use of coupons placed in the local newspaper. The use of coupons will introduce people who are not yet familiar with either the Director or the use of a Hand Wash style car wash.




3.7 Marketing Mix

HCWAC’s marketing mix is comprised of the following approaches to pricing, distribution, advertising and promotion, and customer service:

Pricing – the pricing scheme is based on a per service price. A HCWAC “Card” can be purchased, which provides volume discount to the user.

Distribution – The offered services will be distributed from HCWAC’s facilities.

Advertising / Promotion – HCWAC will use different methods for advertising and promotion.

Customer Service – Exemplary customer service will be provided.

3.8 Marketing Research

During the initial stages of the marketing plan development the Director performed primary market research in the form of a questionnaire/survey. The Director outsourced the development of the survey to a local Professor of Statistics at Monash University’s GRIS. While the Director could have undertaken the development of the survey in-house, the end result was a far more valid and statistically significant product.

The survey was handed to a total of 150 people within the target market. 54 surveys were returned completed. The results of the survey provided valuable insight into the customer preferences as well as the decision making process of the target market. While some of the already held assumptions were confirmed, the survey provided HCWAC with new information that would have been otherwise unavailable.

4.0 Financials, Budgets and Forecasts

This section will offer a financial overview of HCWAC as it relates to the marketing activities. HCWAC will address break-even analysis, sales forecasts, expense forecasts, and how they relate to the marketing effort.

4.1 Break-even analysis

The break-even analysis indicates that $9,122 is required in monthly revenue to break-even.




Break-even analysis chart

Monthly break-even point – where line intersects with 0

Break-even analysis:Monthly Units Break-evenMonthly revenue break even

203$9,122

Assumptions:Average per-unit revenueAverage per-unit variable costEstimated monthly fixed cost

$45.00$8.00

$7,500

4.2 Sales Forecast

The following chart forecasts sales based on the Market Segmentation Strategy. Sales are seasonal in this industry, tending to be higher in the warmer summer months, and to drop off in the winter. However, HCWAC will aim to flatten sales across the sales cycle by targeting segments that will want to keep their cars clean and looking good all year round.




Monthly Sales Forecast

4.3 Expense Forecast

The expense forecast will be used as a tool to keep the marketing on target and provide indicators if corrections need to be made. Additionally it will require long term analysis.

Monthly Sales Forecast




Table: Marketing Expense Budget

Marketing Expense Budget 2005 2006 2007AdvertisementsNetworkingOther

$14,100$1,600$1,575

$19,000$2,000$1,500

$24,000$2,500$1,500

Total Sales and Marketing Expenses

$17,275 $22,500 $28,000

Percent of salesContribution MarginContribution Margin / Sales

20.94%$61,11674.06%

17.07%$102,719

77.93%

15.94%$138,868

79.06%

5.0 Controls

This The purpose of HCWAC’s marketing plan is to serve as a guide for the business. The following areas will be monitored to gauge performance:

Revenue – Monthly and annual Sales – Monthly and annual Repeat business Customer satisfaction

5.1 Implementation milestonesThe following milestones identify the key marketing programs. HCWAC notes it is important to accomplish each one on time and on budget.

Marketing Plan CompletionAdvertisement Campaign #1Profitability for the coupon programAdvertisement Campaign #2

2005 2006 2007

Table: Milestones

MilestoneStart Date

End Date Budget Manage

rMarketing Plan CompletionAdvertisement Campaign #1Profitability for the couponsAdvertisement campaign #2

1/1/20051/1/20051/1/20071/1/2005

2/1/200531/12/2006

N/A31/12/2007

$0.00$6,550$1,005$7,550

JohnJohnJohnJohn

Totals $15,105




5.2 Marketing OrganisationJohn Smith will be responsible for developing, implementing and overseeing the marketing activities.

5.3 Contingency Planning

Difficulties and Risks: Problems generating visibility Overly aggressive and debilitating actions by competitors.

Worst Case Risks: Determining that the business cannot support itself on an ongoing

basis. Having to liquidate equipment to cover liabilities.




Appendix A – Sales Forecast Table 2005

Sales $$ Jan Feb Mar Apr May June July Aug Sep Oct Nov DecIndividuals 300 345 500 1,222 2,333 6,766 7,878 8,890 9,976 10,332 12,990 14,554Businesses 200 350 450 500 532 544 598 601 623 644 687 702

Total $500 $695 $950 $1,722 $2,865 $7,310 $8,476 $9,491 $10,559 $10,976 $13,677 $15,256

Direct Cost of Sales $$Individuals 15 17 25 61 117 338 394 445 499 517 650 728Businesses 10 18 23 25 27 27 30 30 31 32 34 35

Subtotal $25 $35 $48 $86 $143 $366 $424 $475 $530 $549 $684 $763

Appendix B – Marketing Expense Budget 2005

Jan Feb Mar Apr May June July Aug Sep Oct Nov DecAdvertisements 1,000 1,250 1,500 1,750 500 550 600 700 1,000 1,500 1,750 2,000Networking 100 125 150 150 125 100 125 150 175 200 100 100Other 100 125 150 175 100 125 150 175 100 125 150 100

Total $1,200 $1,500 $1,800 $2,075 $725 $775 $875 $1,025 $1,275 $1,825 $2,000 $2,200

% of sales 240% 216% 189% 120% 25% 11% 10% 11% 12% 17% 15% 14%Contribution Margin ($725) ($840) ($898) ($439) $1,997 $6,170 $7,177 $7,991 $8794 $8,602 $10,993 $12,293Contribution Margin / Sales -145% -121% -94% -26% 70% 84% 85% 84% 83% 78% 80% 81%



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