Category: Business Planning

Concept and Its Importance

Nowadays, there are many options for people to develop their business. People should be ready for making fast and well-grounded solutions, get adjusted to the changes, and do not be afraid to try something new. Still, keeping to the tradition is also a good strategy. In this project, it is offered to introduce a new bakery shop.

Modern people are so involved in using numerous technologies that they simply forget about the beauty of the real life. A new bakery shop aims at reminding people about taste, freshness, and the reality that is around and offering the best services at affordable prices. It is a combination of fresh bakery products with supplementary services like coffee, tea, fresh juice, etc.

A fresh bakery concept can be interesting to business people, who want to diversify their routine lives, families, the members of which want to enjoy the quality of food, and even single people, who are able to feel a kind of family support among the workers of the shop.

Concept as an Opportunity

The peculiar feature of the chosen concept is to prove that bakery is not just the sphere for people to work in. It is an opportunity for different people to create something new, special, and tasty. The idea to create a bakery shop with a number of services offered to people is not random. It is developed on the basis of a number of suggestions and opportunities.

First, it is a chance to start cooperating with different stores to deliver the products to and to buy the products for work. Second, it is an opportunity to use the services of independent farmers and rely on their natural products and quality.

Finally, a properly advertised bakery shop with a good reputation is a chance to enlarge the sphere of services and open an online shop offering the products to people from different places and delivery them on good terms. With time, there should be an opportunity to create an attractive discount system that underlines the appreciation to regular customers.

Resources

To implement the offered ideas about the bakery shop, it is necessary to choose a good team of workers, the experts from different spheres. To start the chosen business, the following people are required:

1. Two bakers to be responsible for the quality of products offered;
2. Two people to serve the customers (one female and one male);
3. Two managers to choose a building, organize the work, and consider the risks, etc.

The materials should not be all new because the task is to create a home-like atmosphere. It is possible for the chosen people to look for some interesting antique things at home.

Of course, some expendable material should be bought; therefore, it is necessary to take care of the funding details. To avoid any business relations misunderstandings, it is possible to make an agreement with a bank and discuss all conditions on their terms without any threats to a new business development.

Neptune Gourmet Seafood

Neptune Gourmet Seafood is ranked as the third-largest seafood manufacturer in North of America. The corporation has earned itself a first-class status among its customers. It has positioned itself as the best sea food producer in the region.

Neptune Gourmet Seafood gets in touch with many of its diverse customers through an assortment of channels. With about 30% of its revenues, which happen to stand at $820 million per annum, being generated through selling frozen and processed fish products to the US grocery chains, the company is stable.

Role of business audit in strategy

Strategies are major initiatives assumed by corporate executives to help a corporation positions itself in a way that makes it fair well against the antagonism from its rivals as noted by Camillus(1986, p. 210). Devoid of a strategy, expensive resources will be watered down, the labour of workers will be unfocused, and distinctiveness will not be achieved.

The external surroundings appraisal provides any big business with a significant connections and understanding. Appraisal of the external environment helps an organization to make connections or understand relations between its competitors, customers, and the commodities/services it presents (Kazmi, 2008, p. 255).

Kazmi (2008), in addition, notes that policy audit entails evaluating the definite course of a business and comparing that route to the direction necessary to be successful in a changing atmosphere. In the case of Neptune Gourmet Seafood, there are a number of actions the company can undertake, in order to place itself in a strategic position.

A better understanding of strategies the company can employee can only be arrived at based on a business audit. Neptune is audited in this paper based on porter’s five forces model, PESTEL model and a Swot analysis.

Porters Five Forces Model Analysis

Competitor Rivalry

Neptune operates in a very competitive market or industry. In order to remain aggressive in a changing competitive environment, a company is required to make modification in its prices from time to time, or the quality of product it manufactures (Della et al, 2005, p.124).

In the same approach, the authors notes that there is need for a company to change its market distribution channels as well as keep pace with changing fashions and trends of products it specialise in. Neptune Gourmet Seafood can make use of this force to enhance its strategic position, and as a result keep it competitors at bay.

By cutting down the price of it product, Neptune will benefit by winning a large share of customers and in the end improve its revenue. Similarly, Neptune is supposed to come up with a more effective distribution channels to facilitate a smooth distribution of it product to its customers.

Threat of New Entrants

In case the market is doing well, more companies will be tempted enter. Although, there are no clear threats of new entrants in the case, the industry in which Neptune operates is very attractive. Fortunately, establishment costs are high meaning a huge entry barrier that continues to bar entry by other players.

In case there are any new entrants, this will eventually increase competition and as a result reduce the returns. To overcome such threat, a company can lower it price to discourage more entrant. Neptune Gourmet Seafood can make use of this strategy to benefit from maximised profit as a result of few competitors.

Threat of Substitutes

Companies often do not just have to contend with competition from companies offering same kind of products but also companies offering substitute products. In this globalizing world, with the internet, people are able to access information thus identify substitutes easily.

Often, cost leadership and competitive pricing is helpful in dealing with challenges or problems of substitute offerings. In cutting its prices by a half, Neptune Gourmet Seafood will discourage chances of being substituted, and as a consequence benefit from improved sales of its products. Away from pricing is adopting quality production processes thus anchoring on quality and value to win customers.

Buyer power

Neptune’s buyers are very sophisticated i.e. they have great interest in quality and improved services. The availability of other options gives them relative power over Neptune.

Being able to maintain current customers and attract potential buyers will enhance the competitive position of any company. By offering competitive prices, Neptune, will be able to consolidate its current potential customers and at the same time attract more, hence benefiting from improved revenue due to extra sales.

Supplier power

The last force of porter’s model entails the power of suppliers in influencing the competitive position of a company. To benefit from a competitive position a company is supposed to deal with those suppliers that supply it with products at a reduced rate.

Such rates can be achieved through buying products in bulk. Similarly, Neptune can as well enhance its strategic position by dealing with those suppliers that can provide most of commodities, such as fishing devices at a reduced cost. This will eventually lower down it production cost, and consequently improve its profit.

PESTEL analysis

For one to comprehend efforts made by Neptune to achieve its current position, it is necessary to analyse the company position using the PESTEL model. The PESTEL analysis is a helpful instrument for comprehending the market developments or decline. PESTEL is a short form for Political, Economic, Social, and Technological, environmental and legal factors, which are used to gauge the market for a company or organizational unit.

Technological Factors

To facilitate making decisions and plans for the future events, Neptune Gourmet Seafood has technologically improvised strategies that have made it possible for the company to be competitively placed compared to its rivals.

Some of these technological strategies include coming up with state-of-art fishing vessels installed with high scientific super freezers which make it possible for the vessels to harvest fishes and freeze them to extremely icing temperature, as low as -70 F compared to the usual -10 F or -23 F, within hours of capturing them.

The most remarkable part of technological strategies incorporated by Neptune is reflected on the manner in which these vessels have been designed, such that the boats can navigate themselves by using systematic devices that direct them to the most excellent fishing zones, where they manoeuvre the fishing apparatus in addition to confiscating the catches and eventually transmitting the required fishing information back to the receiving devices on the shore.

Environmental factors

In order to operate within the stipulated environmental set of laws that dictate the manner in which fishing should be carried on, Neptune’s fishing vessels have been mounted with other systems, along with more sophisticated fishing devices, which ensures that only the fully grown mature fish are caught, and that the nets are not overflowing to avoid damaging the heave.

As a consequence, Neptune has not experienced any problem with the authority, and has as a consequence increasingly landed only the top quality catches.

Legal factors

To attain their current position, Neptune Gourmet Seafood had to deal with legal modification, such as laws restricting fishing on the shore and rather recommending fishing to be carried on in deep seas. To triumph over such encumbrance, the company begun to rely on technology, and as a result launched fishing vessel installed with state-of-art technology that enabled Neptune Gourmet Seafood’s fortunes to grow in fold.

Economical Factors

Economically, the company has invested in diversifying their products, in order to incorporate customers of all financial backgrounds. One economic player that influences Neptune’s operation is the U.S. Association of Seafood Processors and Distributors. Its capacity to control industry activities and prices directly impacts on the strategic choices for Neptune.

Social factors

So as to overcome social hindrances, Neptune has expanded their market to cover almost the entire US. To attain this success, the company has used various to distribute its products to different regions in the country, where people with different social backgrounds reside.

This means that in case one brand or product is not fetching good price in one region due to cultural norms and expectations, such products can be transferred to other regions with different social views.

SWOT Analysis

In a competitive marketing environment like the one faced by Neptune Gourmet Seafood, a strategic plan will help the company to have a cutting edge on its competitors.

To thoroughly analyze the market and the different situations surrounding Neptune, it is necessary to perform SWOT analysis. SWOT is an abbreviation of strengths, weaknesses, Threats and Opportunities. A swot analysis on Neptune’s operations is as shown in the table below.

Identification and Critical Analysis of Past Strategies Used By Neptune Gourmet Seafood Have Used To Reach Their Current Position

A strategy is generally an approach, founded on comprehension of the broader situation in which a firm functions, its own strengths and weaknesses, and the problem the corporation is endeavouring to address (McDavid & Laura, 2006, p.340).

According to the authors a strategy gives a company a framework within which to works, clarifies what the company is trying to achieve and the approach it intend to use (McDavid & Laura, 2006, p.340). However, the authors note that a strategy does not spell out the precise activities.

On the other hand, McDavid & Laura (2006, p.340) observe that Strategic planning is mainly planning that facilitates the good management of a process. It takes a company outside the day to- day actions of its projects, and provides it with the immense picture of what the company is doing and where it is heading to.

McDavid & Laura (2006, p. 341), in addition, comments that Strategic planning gives a firm clarity about what it actually wants to accomplish and how to go about achieving it, rather than a plan of action for day to-day functions.

Neptune has positioned itself as the “The Best Seafood on the Water Planet.” To consolidate its position, it has segmented the market and curved for itself a niche in the upmarket.

This strategy that is anchored on focus i.e. targeting only a specific market segment, works well to help organizations reduce marketing costs while creating brand salience or brand value. Market segmentation arises from appreciation that the market is diverse and thus each different group or aspect of the group requires a special approach.

This approach to profitability requires that an organization discover the market segment it can serve best. Once the most profitable or manageable market segment has been identified, the organization devises marketing strategies that address the peculiarities of the given segment. Specialization is done basing on different factors; as per market characteristics.

This strategy has worked well for the company leading to a towering presence in the up market. However, going into the future, given it has increased capacity and it deals in perishable goods, Neptune has to consider possibility of entering new market segments so as to deal with production from increased capacity.

Neptune has also in the past anchored its strategies on resource development, which in turn helps towards improved quality products. The quality products help in differentiation the Neptune brand in the market. Competition is largely depended on product differentiation. Product differentiation is largely defined by the extent to which products distinguish companies or firms.

To the extent that a company’s products are distinct, competition is minimal. When competition is minimal, there is a higher likelihood of a firm’s profits increasing or growing sporadically. Therefore, this strategy has worked for Neptune in the sense that its quality products have enabled them to go for premium pricing thus charging higher than competitors but still attracting customers.

Despite the registered success, to penetrate into other markets, Neptune has to start seeking differentiation within its products. Based on this line of thinking, the idea of introducing a new brand for Neptune is a welcome consideration.

Finally, Neptune invests heavily in its production processes. One of its strengths is high investment in resources. A resource based approach to strategy is great in the sense that it proffers internal capability on an organization and can thus deal well with external threats. For instance, Neptune has invested in the best technology in the market but also in new ships.

This gives opportunity for increased production that may translate into economies of scale in the future. However, in the short run, Neptune thinkers have to consider how to translate the high investments into cost leadership. Going into the mass market might help towards full utilization of its capacity and this may yield it a competitive advantage based on cost leadership.

Explanation and evaluation of the role of strategic planning

Olsen (2006, p.16), notes that a strategic planning procedure is not something that can come to pass in an informal way, at an ordinary planning meeting or at some stage in a staff meeting. It requires thorough planning to set it up, so that the process is systematic and all-inclusive. Olsen (2006, p.17) in addition, remarks that strategic planning can incorporate both short and long term plans.

In case of short term strategic plans, a company may make use of them trying to tackle a temporary problem which it may be experiencing or expecting to come across in future. Such situation may include countering an advertisement from a rival company, which could be intending to perplex the market with products reflecting similar characteristic as its own.

On the other hand, a company that comes up with long term strategic plans could be preparing to add more value to its customers than its rivals, and in the process attain a position of relative advantage (Hill & Jones, 2009, p.405).

Hill & Jones, in addition observes that these values could be added through key drivers such as cost leadership and differentiation of products. For cost leadership, Hills& Jones notes that, this is an approach endeavouring to become the lowest cost producer in the industry. Through production in bulk the company will benefit from reduced cost of unit production.

Just like Hill & Jones, Peng (2008, p.45) observes that the company can compete on price with any other producers in the industry hence earning higher profit per unit product produced.

On differentiation of product, Peng (2008, p.46) remarks that strategy calls for introduction of a product or services that offer characteristics that are both unique and highly valued by the end user. As a result, the uniqueness provided by the product may permit the company to charge a premium price for it commodities.

In the case of Neptune Gourmet Seafood, the company has come up with both short term and long term strategic plans in order to overcome most of the constraints that have emerged in the course of operation.

Short term strategic plans

Some of these short term strategic plans include the different brands of products that the company has introduced in the market. Example of such brands by Neptune seafood comprise of the Gold canned salmon, sardines, mackerel, tuna, and pilchard.

Advantages of short term plans

In case the brand receives good performance, the company can think of introducing the product into the market with more confidence (Ireland et al 2008, p.104) another advantage associated with the short term strategic plans, is that the plans gives a company enough room to critically analyze and monitor the performance of the products (Kaufman, 2003, p. 97).

Kaufman further observes that this prevents companies from incurring unnecessary costs experienced during their development.

Disadvantages of short term plans

Short term plans have a number of limitations, among them is the fact that this plans are usually improvised urgently. The urgency in their formulation usually denies the strategy makers enough time to carry out an elaborate research on their success, and hence most of them are implemented without the necessary prior test as noted by Kaufman, (2003, p. 97).

Kaufman (2003) further observes that short term plans are usually expensive to implement as some of them are formulated within a short notice. Most companies are therefore forced to look for financial sources to fund their implementations as they are usually not considered in the company budget.

Long term strategies formulated Neptune Gourmet Seafood

On long term strategic plans, Neptune Gourmet Seafood has implemented a number them. The most outstanding of Neptune Gourmet Seafood’s long term strategic plan is the embracement of state-of-art technology in it’s shipping vessels.

Advantages of long term strategic plans

Out of this strategic plan, the company has been placed in a better competitive position compared to it competitors. This incidence has helped the company to enjoy a large share of the market, which as a result has enabled Neptune Gourmet Seafood to register outstanding profits.

The other long term strategic plan implemented by Neptune Gourmet Seafood includes increasing and improving its channels of distribution.

Through these elaborate outlets, Neptune Gourmet Seafood products have been distributed to its customers all over the US at the right time and place. As a consequence, most of the company’s customers have developed unwavering trust on it, a result that has enabled the company to command such a huge share of the large market

Among the many benefits of long term strategic planning adopted by many companies and Neptune Gourmet Seafood in particular, is that most of these plans are usually thoroughly researched on, before they are implemented (Betz, 2002,p.47). Betz in addition explains that these create a sense of assurance to the company even before the plan is implemented.

Disadvantages of long term strategic plans

The most notable disadvantage of long term strategic plans is that coming up with these strategies requires the company to dedicate most of it time on them. This is reflected on the extensive research usually carried out to facilitate their success.

Similarly, the plans are extremely expensive to both formulate and implement. The high cost of their formulation and implementation is reflected on the huge figure of competent workforce required to successfully implement the plans.

References

Betz, F., 2002. Executive Strategy: Strategic Management. John Wiley & Sons, California.

Camillus, J., 1986. Strategic Planning and Management Control: Systems for Survival, Lexington Books Publishers: New York

Della, P., V., Low, M & Lyman, K., 2005. The Business Strategy Audit, Cambridge Strategy Publications: London.

Hill, C., & Jones, G., 2009. Strategic Management Theory: an Integrated Approach, Cengage learning publishers: New York.

Ireland, R., D., Hoskisson, R., E., & Hitt, M., A., 2008. Understanding Business Strategy: Concepts and Cases Study. Oxford university press: London.

Kaufman, RA, 2003, Strategic planning for success: aligning people, performance, and payoffs. John Wile y and Sons, California

Kazmi, J., 2008. Strategic Management and Business Policy. Tata McGraw-Hill: New York.

McDavid, J., C., & Laura, R., L., 2006. Program Evaluation & Performance Measurement: Sages publishers: London.

Olsen, E., 2006. Strategic Planning for Dummies. Wiley publishing Inc: New Jersey.

Peng, M., W., 2008. Global Strategy. Cengage Learning: New York.

Introduction

Company X is a computer manufacturer. As such it is vulnerable to a series of risks within its internal environment as well as its external ones. Technology and human based factors are particularly applicable in this scenario.

Risk register

Sources

The eight sources of risk identified for Company X are: currency fluctuations, competition for the product, theft of goods, unforeseen alterations in distribution and production methods, incompetent administrators, changes in trade policy, machine failure and an earthquake. The major source of currency fluctuations is the acquisitions of foreign legal tender that will need to be converted into home currency.

In other words, this is an economic factor. Although Company X is an international company, it is still headquartered in the United States and will need to channel their profits back to the US dollar. If the exchange rate at a certain point in time is high in a foreign country, it may be low in the home country such that profits which were estimated to be high there may actually end up being very low in the US (FEMA, 20010).

Therefore, this volatility is what imposes risk the business. Competition for the product (another economic factor) stems from the fact that the computer manufacturing industry is moderately competitive. Therefore, there will be other companies that will try to offer more or less the same products and features that the company is offering and this will threaten its profitability.

Theft of goods is affected by the level of insecurity within a country. Nonetheless, any business can lose its commodities through this avenue because it is not easily predictable. Theft is essentially a human factor. Changes can occur in distribution and production of the computers thus causing obsolescence or production of inferior goods.

If a competitor creates a better way of producing goods and Company X insists on using traditional techniques, it could easily go out of business or witness a substantial loss in market share. These disruptions are technological factors. Incompetent administrators may be a source of business risk because managers or employees are subject to flaws and may not always be in a position to do what is right.

Human factors such as these represent internal factors that the company can be subjected to. Changes in trade policy stem from political factors or those ones that have been instated by a particular government. To this end, they could affect Company X’s profitability as well as its position within the computer manufacturing industry. Machine failure is a physical factor that relates to the resources owned by a particular enterprise.

Since this organization engages in production processes, it is highly dependent on machines and may experiences losses in profits because manufacturing is essential to the profitability of this company. Lastly, an earthquake stems from a natural force that can occur and cause a standstill to Company X’s operations.

Risk level

The likelihood of occurrence of the earthquake is quite relatively low because the area where Company X is headquartered has ever experienced an earthquake although this was a decade ago. Furthermore, statistics indicate that there is no predictable pattern to this. On the other hand, the severity of impact would be quite intense; this would lead to a total standstill of the company’s production processes.

Its controllability would also be quite difficult for the company. Given all these factors then the earthquake has a high risk to the business. On other hand, theft is more likely to occur than the latter. The severity of impact is also relatively serious as the firm could lose a lot in terms of its stock. However, because theft is controllable through security measures then it can be kept under check.

This means that it is highly risky if the right measures have not been instated. Changes in trade policy are quite likely to occur. However, their effects may not be as severe as the first two types of risks so this would make them low risk. Changes in production and distribution also have a very high likelihood of occurrence.

They are external factors and cannot be controlled. Even their severity of impact can be very high so utmost precedence should be given to this matter. Because of that, it is likely that this type of risk is high risk. Currency fluctuations are sometimes predictable and their impact may not be too severe. This is therefore a low risk issue. Machine failure is an internal factor; it can be controlled by continual checks and maintenance.

Its impact would be very immense to Company X; because of the ability to control it, then this kind of risk is moderate. Incompetent administrators are an internal issue; they can be controlled by hiring the right staff. However, when they do the wrong thing, this could have serious repercussions on the organization.

To this end, this is a moderate risk. Lastly, competition for the product is quite difficult to predict and it would have severe repercussions. Nonetheless, the company can stay ahead of others by taking certain steps.

Risk response

In order to reduce the damage caused by theft, certain security measures will need to be enforced. For example, all stock within the company premises will need to be placed in heavily protected premises that have strong steel structures around them.

Additionally, the company could avoid putting all its goods under one roof so that the risk is spread. It should also select a safe neighborhood that is secluded from human populations that would easily access the material. Currency fluctuation risks can be reduced by using one currency to estimate profits.

Competition for the product can be put under control by investing in research and development within the company so that it can always be ahead of its peers. Similarly, the company could deal with disruptions in the distribution and production of the products through the same avenue i.e. continual investment in research and development. Incompetent administrators can be handled by doing thorough job recruitment.

The firm can instate a policy of promoting only those employees who have served in subordinate positions so that it can be sure about the character of its administrators or so that it can avoid the possibility of hiring an unethical person. Changes in trade policy are difficult to predict and estimate.

Company X should simply acknowledge that they exist. However, to minimize the risk, it needs to look for partner countries that have a high level of political stability.

Machine failure can be mitigated by instating a continuous process of quality control which will automatically detect machine defaults that could lead to failure. Earthquakes cannot be prevented but their effects can be reduced if the company invested in a good insurance policy as well distributes its warehouses to various parts of the country so that the damage is not too severe.

How the identified risks emanates from the company’s global marketplace activities

Currency fluctuations are determined by the issue of global marketplaces. Some of the stated challenges are related to the manner in which these enterprises go about dealing with their underlying problems. Company X is an international company and it has distribution systems in various parts of the world.

Furthermore, even production is being done in more than one country. Currency fluctuations may affect the company positively if the company’s laborers come from a country with a relatively low currency value compared to that of the Dollar.

In this regard, the company can save a lot of labor costs simply because the value of the legal tender in their home country is high. On the other hand, the company can be affected negatively if the alterations are done in a manner that disfavors the Dollar. Because of this decision to select global marketplaces, the company must be ready to adjust accordingly so that it can deal with those losses that stem from currency changes.

Contingency plan

The risk under consideration is the potential disruption of business due to a tornado at the area around the company’s location. This would be the business contingency plan is such an event:

Strategic changes

The company will need to gather all its members together and ensure that every individual is around. A search will have to be instated once it has been found that some members are missing. Right after the tornado, the organization will need to make use of its food, water and medical supplies that had been stored by the firm. This will aid those who had been physically affected by the disaster or those who are in shock.

After a number of days when the physical well being of the workers has been ascertained, it would be essential to start looking into other technical aspects of the business. The company may have to use some of the inventories that it had set aside for such an occurrence.

Power lines may have been destroyed by the tornado so the company will need to resort to alternative power sources that it should already have in place before any disaster. Similarly, communication links need to be properly analyzed and reinstated.

The tornado may have destroyed its equipment so it would definitely be a good idea for the firm to keep a high level of inventories for important equipment at other locations.

It should also go back to some of the backup systems that it had put in place for its media so that crucial information is reinstated (Swartz, 1998). In this case, it is assumed that the organization already has a variety of data recovery technologies in place. It can therefore utilize them in trying to acquire information that is vital to the operation of the company.

Although the company may be subjected to a local disaster like a tornado, it still needs to continue in operation because it serves international clients. It can ensure this by taking immediate actions and midterm actions to ensure that operations continue as before. The firm should define the threshold for disaster declaration. Once the tornado has occurred, it should be declared as a disaster as soon damage has been assessed.

It should select a business continuity team which should be responsible for company changes after the tornado. There ought to be a name list and contact details of all the personnel within the organization. The stakeholders within the company and outside need to be addressed through a valid communication plan. Strategies for relocation need to be in place if the tornado had destroyed infrastructure.

Once relocation has been done then the company may actually be in a position to restore their functions. They need to do this by first starting with identification of critical services and business processes and then strategizing on how to implement it.

The company may also protect itself from dire effects of a tornado by instating measures that ensure rapid continuity. It can secure the premises and other infrastructure through reinforcement. It needs to have strategies on back up data in another location and must also possess personnel who can easily take on these tasks.

Ethical use and protection of sensitive data

Details about employees and their performance, pay or their private data can be classified as sensitive information. A tornado may cause confusion and loss of certain devices such as laptops that contain this sensitive information. The company can protect it by using encryptions and also by using a series of passwords for authorized personnel only.

Sensitive information by its very nature is very important to the running of the business so it needs to be available when possible.

The company can protect itself against power outages that may emanate from the tornado by having an automatic backup system. This type of data can be protected even in the event of a tornado through the use of digital signatures which create an atmosphere for making the material as authentic as possible (Kokolakis, 2008)

Ethical use and protection o sensitive data will be ensured through two major pathways; they include confidentiality and integrity. Confidentiality refers to the disclosure of information only to those that are authorized. In this case, if the company possesses information about credit numbers for clients, then it will ensure confidentiality by only placing it in one database and a back up.

If the information had been in many systems then it is likely that an unwarranted party may have gained access to it. Confidentiality breaches will be avoided during the disaster by placing the back up in another distant location and by recovering stolen laptops or PCs.

Integrity can ensure protection of sensitive data by preventing unprofessional or wrong alteration of information during disasters. This aspect can be ascertained by instating a system that will countercheck information after a disaster with backups.

Backup copies can be protected through a number of ways; physical controls like using cable locks and barricades can be used. Also, since technology is applicable, security cameras may be instated so as to ascertain that no individual tampers with the backup copies. Roles within the firm will be separated so as to prevent unauthorized conduction of transactions when dealing with the backups.

The backups will also be classified as public, confidential, private or sensitive and different security controls instated for each class. The sensitive and confidential information will utilize the tightest controls. These controls will include firewalls, data encryption, network detection systems for intruders and the usual passwords.

The policies that will be in place will be guidelines and standards on protecting confidential information. This will be done by instatement of certain password policies as well as corporate security policies.

Members will be told about measures that can be instated once they break the policies and similarly, recruitment strategies should involve security of confidential information by ensuring that new employees understand the importance of protecting sensitive information.

Ethical use and protection of customer records

The company may have credit card numbers for individuals that it carries online transactions with. The disaster may have caused a loss of the database that contains this information. Therefore, there may be a need to use backups. This will expose customer information to a certain level. The company can restrict access to the backups by only permitting authorized personnel to access those files.

Communication plan

In anticipation of an adverse event, communication to vendors will need to be done in order to ensure support. Communication to the IT team will be done concerning prevalence of data safeguards as well as procedures that will be followed in those scenarios.

Thereafter communication to all team members concerning inventories ought to done and planned. Fire suppression and first fire detection will also need to be communicated between administrators. Also, communication prior to an adverse event should include making plans for maintaining reserves for food and medical supplies.

Upon occurrence of the disaster, the first aspect of communication will start with the emergency services where the company will have a liaison officer who can then convey information to members of the emergency services.

After an assessment of all the damage done to the firm and identification of the functions that have come to a halt, communication will need to be made from the head of the recovery team to other members of the recovery team as well. Thereafter, the recovery team will communicate to the staff to give them information about fellow staff members who may be injured, admitted in hospital or missing.

They also need to know about the organization’s expectations from them i.e. whether they are expected to work or not. Usually, this can be done through a help line, personal calls or even local radio announcements if the staff members have already gone home.

Members of the recovery team will need to establish a decision for the next step forward and they should communicate this to employees as well as other stakeholders like suppliers and transporters. The firm cannot also ignore the public because they are an essential part of the company’s operations. It would do them a lot of good if they dispelled the rumors by constantly feeding the public with accurate information.

They can do this through the media. Lastly, there should be debriefing such that the emergency can teach the organization’s stakeholders some critical lessons from the experience. Afterwards, certain parties like insurance agents and partner organizations need to be informed about the events that have taken place within the firm (Dimattia, 2001).

Prior to an event, the communication plan needs to be tested by all members of the organization. They need to be informed about all the necessary steps that they should take with respect to communication. All the members who will carry out those activities should be identified and told about the expectations that the organization has for them in the future.

Restoring operations

If the tornado had a huge impact then there will be a need to start business operations in a fresh manner. Before this is done, the organization will need to identify all of the damage caused by the tornado. This may include injuries to staff, damages to the building, damages to the stock of the company, damages to some equipment and vehicles consumed.

The company will need to establish the minimum applications and functions that are needed and then start with the data recovery process. The next step should be to convene a recovery team. They will be given information about all the key personnel. The rest of the members will also be told about any missing groups.

The decision on the next course will be taken and there will be communication to all the concerned business partners. A review of the BCP will need to be done and all the procedures followed. It may be necessary to relocate to a second workplace site as the tornado may have destroyed conditions in the first location.

This means that all the telecommunication and infrastructure in the first site will need to be instated in the second. Thereafter, there should be replication of methods between these two sites. Various functions will be restored and respective staff put back in their positions so as to begin.

Recommendations on ways of implementing, monitoring and adjusting the BCP

A business continuity plan must be related to the business under consideration. This means that the most critical functions need to be covered in the BCP and since these functions keep changing, then one must adjust accordingly.

Issues such as staff wages, distribution, sales need to be revisited and the impact of a disaster analyzed. There should also be a re-examination of the resources that will be crucial to the recovery process. Also, the extent of damage to the business can be estimated through a continual assessment of the plan.

First of all, the plan will be implemented through the crisis command groups in conjunction with the rest of the organization. The team will be in charge of assessment of damage cost, management of movement of people to a secondary site as well the restoration of the technical components of the workplace.

On the other hand, a process of restoring lost staff will need to be done and the HR crisis team will be responsible for this. Other issues like data recovery will be done by the IT team while the actual infrastructure requirements will be done by the technical team.

An emergency can be declared on by the head of the crisis command team. This individual will be known before any disaster and in case he or she is involved in the disaster then a second command crisis team leader will be selected just so that he can remain on standby.

The plan will be monitored on an annual basis in three major areas; staff awareness, the technical solutions as well as verifications or testing. This implies that human and non human factors are dealt with adequately. It is also likely that one year would not cause undue inconveniences to the organization. The plan evaluation will be carried by the company’s top administration because they will be in a position to look at the bigger picture.

The adjustments will communicated to the company through a meeting and all the necessary adjustments will be done by allocating the tasks amongst concerned individuals. Training will be done by taking employees through a disaster recovery course. On the other hand, specific teams will be expected to know about disaster recovery in their own departments so these trainings will be done practical within the workplace through an outsourced firm.

Conclusion

Most important to the business continuity plan is the element of circular examinations. In other words, once a disaster has occurred, an organization must take the time to learn from the experience.

Otherwise, it would be pointless to invest all that time and resources only to find that there were not adequate mechanisms to deal with the disaster and then repeat the same thing again without ever really learning from it. Consistent review of the business continuity plan is always the best way of ensuring that a company’s business is not overly interrupted due to occurrence of a disaster or calamity.

Reference

Dhillon, G. (2007). Principles of information systems security. NY: Wiley and Sons.

Kokolakis, S. (2008). Information systems security. London: Chapman and Hall.

Swartz, E., Herbane, B. & Elliot, D. (1998). BCP Planning in the UK finance sector.

FEMA (2006). Purpose of standard checklist criteria in business recovery. Web.

Dimattia, S. (2001). Planning for continuity, Library journal, 32.

Business concept

Vision statement

The company’s vision is “to be a dynamic national brand that will focus on providing the public with a permanent escape from the expensive services offered by our competitors”. This will be done through the provision of timely and interactive services for music shoppers in order to allow them save on time and money.

Mission statement

The business will seek to promote local population’s interest in music services through an expansion of the public’s exposure to music via the one-stop shops as well as the internet. This shall also include introducing this area to the market segments that are yet to be fully utilised. Therefore, it presents an excellent business opportunity.

Product description

Music of all types will be available in the store as well as on its website. Popular music will be one of the main products at the store. It will also seek to ensure that music is provided in all forms- DVDs, CDs and downloadable pieces.

However, the company will primarily deal with music products that are popular among the young people. In addition, the company will obtain these products and services from a wide range of sources in order to meet the demands of the clients.

Customer description

Zeek’s Music Store targets a wide range of customers but will place an emphasis on young people aged between 14 and 35 years. In fact, this group of people make the largest group of people looking for the latest music, but few businesses have been able to satisfy their needs.

Benefits for unique proposition of the company

The company will achieve a positive reputation among the young people because it has chosen to venture in an area that few organizations have considered as a business opportunity. In addition, music recording and marketing companies have been looking for convenient partners in order to enhance their marketing beyond their shops, especially in targeting neighbourhoods.

Business Model

Zeek’s Music Shop will specialize in providing the population with a one-stop shopping for musical equipment sales, pro audio sales, music lessons, rentals and repairs.

Industry analysis

It is estimated that music and film industry have one of the largest income in the economy, exceeding 50 million dollars per year. In addition, the industry is estimated to have an annual growth of more than 12% (Vogel 46). Statistics also indicate that music contributes to 6% of the national economy. Moreover, the industry employs more than 2 million people either directly on indirectly (Burnett 21).

Market analysis

It is estimated that young people aged between 15 and 25 years spend more than 35 million dollars on entertainment every year. Currently, these people have to walk or drive long hours to obtain these services.

Target customer profile

Zeek’s Music Store will target university and college students as well as working youths. In particular, this group of people seeks to obtain music product from their neighbourhoods or downloading on their computers.

Young people spend much of their time listening to music from their iPods’, computers and iPads. They need a constant and dedicated provider of these services because the music industry is highly dynamic, with new products coming daily to the market.

Competitor analysis

Currently, there the business faces competition from two main companies-Netflix and Blockbuster. These companies are international corporations that have dominated the market over the last ten years (Stickler 91) Since Zeek’s will be a local business, we expect to venture into the business currently dominated by smaller organizations in town.

Some of these organizations are small. Others deal with music rentals only while others only seek to sell pro audio products only. With the wide range of products and services at Zeek’s shop, we expect to conquer the market within the first three months of operation.

Distribution Channels

Since the company is a small and start-up organization, it will first embark on providing its services and products on the site. Customers are expected to present themselves physically at the store.

However, in order to compete with other businesses, the company will also allow customers to register on its website, pay via available online methods such as Paypal and download music and videos. For products like equipments and rentals, services such as music lessons and repairs, the company will ensure that it attracts customers to the store.

Growth plan

The company expects to achieve a 12% growth in revenue within the next five years as shown below:

Growth strategy

In the first year of operation, Zeek’s Music Store will concentrate on rentals and pro audio sales. However, in the second year of operation, music lessons and repairs will be included while sale of equipment will start in the third year.

Operation plan

In addition, expansion of the company’s stores from one to four in the city will be done in the fourth year. In particular, the company will establish new stores near colleges and universities in order to target a large group of customers.

Works Cited

Burnett, Robert. The Global Jukebox: The International Music Industry. New York: Routlegde Taylor and Francis, 2012. Print.

Stickler, Verana. Music Industry Management: Case Study Analysis. New York: Grin Verlag, 2012. Print.

Vogel, Harold. Entertainment Industry Economics: A Guide for Financial Analysis. New York: Cambridge University Press, 2011. Print.

Executive Summary

Education model in the contemporary world has taken a new face where by the conventional education has been complemented by e learning. According to national center for education statistics 20.4 percent of college student across the world subscribe to distance learning program. DL limited is a new UK company that is a part of Sterling consulting group.

The firm offers long distance business management courses in conjunction with university that have subscribed to this package. The company the set-up cost of DL limited involves course development; web portals costs and general operating overheads are £300000.The company has a strategy to expand to other lucrative market to form a network contacts with many universities and governments around the world.

Analysis of the company market environment is therefore crucial to determine the opportunities and strength of the firm in its expansion to other markets (Foster, 1992). The company intends to extend its educational services to markets beyond Turkey, which has been its major clientele. The business plan will seek to outline strategic and product decision in the bid to expand to other markets around the world.

Company Description

DL limited is a higher education consulting firm that provides undergraduate university courses in business management through long distance open learning model. DL limited is part of sterling consulting group with mandate to offer distance-learning package to undergraduate business degree programmes in Europe and other parts of the world.

The firm utilizes the world web technology and other support systems to offer the education package (MacDonald, et al. 2005). The firm is budgeting for an enrollment of 500 students annually from different universities around the world. DL limited company is supported by client universities by their subscription to the e-learning educational model.

This model focuses on both full time and part time students. The model offers the courses to students of the subscribed universities through a web portal that will provide an interactive learning through an instructor (Naidu, 2005, p. 658).

Vision

To be the world recognized center for academic excellence through e-learning model of education.

Mission

DL limited is dedicated in overcoming barriers that restrict access to university education and provide quality education and research through e-learning model in conjunction with other universities across the world.

Mandate

DL limited company will provide distance learning in undergraduate business courses and other business related transfer course. The firm is mandated to offer the below courses in business degree level in its distance learning model.

• Bachelor degree in economics.
• Bachelor degree in finance.
• Bachelor degree business administration.
• Bachelor degree in business studies.
• Bachelor degree in managerial information system.
• Bachelor degree in commerce.
• Bachelor degree in marketing management.
• Bachelor degree in human resource management.
• Bachelor degree in accounting.

Environmental Scan

Environmental analysis seeks to assess internal and external factors that affect the company distance-learning program. In analyzing macro and microenvironment, the S.W.O.T (strength, weakness, opportunity, and threats) analysis will be used. Strength and weakness will analyze the internal environment whereas weakness and threats will assess the external environment under which the firm operates (Barrows, 1994).

Strengths

1. Well-established partner: – DL limited is offshoot of Sterling consultant group, which offers consultation services in UK. Sterling consultant group has three years working experience with senior officials in UK universities and 14 Turkish universities to develop double degree program in business, IT, and Engineering courses. The sterling group has currently 1000 student from Turkey representing a fee income of more than £ 7.7 million to UK universities.
2. Infrastructure:-The web technology to be utilized is superior in reaching more students in different universities across the world. The infrastructure is also cost effective method of learning since no physical amenities will be required to disseminate knowledge. This model of learning enables a student to be exposed to different materials in the web that cannot be offered by one single lecturer or instructor.
3. Financial and resource backing:-DL limited is a new firm from Sterling group. The firm will be launched within three months after its completion and will be requiring £300,000 as its operating costs. DL limited is a subsidiary of Sterling group and therefore the firm will have the advantage of having its initial capital cost transferred to its mother company.
4. Experience support stuff:-The human resource that will be employed in support of the distance-learning model will be required to be well experienced with information technology systems and with skill to handle any query from the customers. The working group will vary in their specialization ranging from information technology technicians to qualified lecturer who will provide a support service to the clients.
5. Availability of variety of business courses:-DL limited has a mandate to provide business courses. Variety of these courses can increase the number of enrolment to the program due to its diversification. These courses may range from accounting to finance and other relevant business courses

Weakness

1. Inadequate business experienced-DL limited is new upcoming company in the distance-learning model of education. The firm has no experience in management know how and will depend on the mother company for a while before it can operate independently.
2. Resources: – DL limited is a new company that has yet no resources and will depend entirely on the sterling group. These resources will include financial and human capital and infrastructures.
3. Weak public perception:-Intensive marketing for the new firm is important if the firm is to gain international recognition. The known firm to the public is Sterling Company and therefore DL limited will have to strategic market itself to be recognized as the provider of distant learning services to client universities.
4. Scope:-DL limited has a narrow scope in its mandate to provide leaning courses. The firm has a mandate to provide only business management courses. This reduces the opportunity to admit other student from other discipline that may want to use the services.
5. Mode of learning:-Distance learning depends entirely on information technology, which is vulnerable to cyber crimes. The business is risky in that these cyber crimes can bring sudden inconsistency in the mode of learning if these crimes. System viruses and interference of information in the database are some of the threats that face distance-learning mode of education.

Opportunity

1. Ready market:-Distance learning model of education is gaining popularity across the world. Currently Sterling group which is the mother company to DL limited has exceed two million distance learning student from Turkey universities. This model is being replicated in Eastern Europe countries such as Georgia and Albania. DL limited will be enrolling a minimum of five hundred student annually.Market for distance learning program is large and therefore DL limited need to expand its infrastructure to accommodate the large number of student who need to enroll in the program. DL limited looks forward in exploring the African and Asian markets to extend its services. This will be made possible by enrolling potential university institutions in these areas to the distance-learning model. These markets are not as saturated as those in America and Europe and therefore will provide a good starting ground for the firm.
2. Government support:-Sterling group has been working with governments in UK and other countries who are in support for the model of education. Government support provides a conducive environment for the company operations and this is an advantage to the firm.
3. Location:-DL limited is situated in UK, which is strategically situated in terms of access to the technologies and support needed. The company is also well located near competent world-renowned universities that will offer support services to new to the firm.
4. Technology:-E-learning technology model is an information technology new approach to learning. Network transfer of skills and knowledge supports this model. It include web-based learning, computer based learning and virtual classroom platform.

Distant learning is however taking a new paradigm shift because of emerging new technologies. Traditional learning methods are becoming more overtaken by new trend in learning methodology. In today’s learning world, learning systems make use of internets, e-mails, video transmission, and even social site such as face book to communicate with students.

Modules on different subjects can now be taught via teleconferencing and shared through social networks. This advance in technology have made learning more cost effective in that many students all over the world can now access education more easily (Owston & Wideman, 1997, p. 66-73).

Threats

1. Competition:-Distance learning is an emerging model for modern education and is therefore subject to competition for several institutions in UK. Firms such as Stone bridge associated collages have well established names as distance learning providers. These institutions offer much flexible and competitive business degree programs and have years of experience in distance learning model.
2. Aggressive marketing:-Aggressive marketing by the competitor is a threat to the firm’s market share. DL limited is a new company that is barely known in the market. The firm needs to develop good marketing strategies in order to compete effectively with other firm in the market.
3. Fluctuation in demand: – From the current economic conditions, it will be difficult to forecast the demand. The number of student forecasted to enroll in the program may be less than planned. One can never be certain on the forecasted demand as a number of factors beyond the organizations control impacts on the demand.
4. Cost of technology:-The intended educational model relays heavily on information technology. However, technology is very dynamic and change over time. Technology that is superior today will be obsolete tomorrow. In corporate world, technology aspect of the organization should be reviewed every eighteen month and changed if necessary. The cost of a new technology is very expensive in terms of maintenance and initial installation.
5. Over reliance to mother company: – DL limited is a new company that is a split from Sterling group. The company will rely on almost every aspect of its operation from the mother company. The mother firm will provide most of the finances for its establishment and even technical assistant.

Business Objectives

DL limited is a new firm that traces it origin to Sterling group. In order for the firm to grow and attain the competitive advantage, the management will have to focus on the objectives and implement strategies to achieve them. These objectives are as follows:

1. Exploring new markets:-DL limited is interested in expanding in African and Asia markets. These markets are new to the program model and this will provide a good starting point for the firm. Survey from 134 countries in Africa showed that distance learning is a new concept in the continent. Among African universities e-learning trend was as follows

The biggest challenge to distance learning in Africa is the internet bandwidth and unstable electricity supply. There has been however efforts to provide undersea cable to the coast of Kenya as per July 2009.

The Asia market is however for more receptive to distance learning model. The strategic approach in markets in Asia in to attract the population to enroll to the program. The target being India and china, which has vast population of universities that may find it convenience to subscribe to this model of learning.

1. Ensure quality learning: – Quality in an essential aspect in distance learning. Quality leaning brings about competitive edge over the competitors offering the same product to the market. In providing quality to the customer, the management will have to review the curriculum of the courses to offer. The delivery methods employed to provide these courses must be efficient and reliable. The human capital employed must be conversant with the system administration. Capacity building through training is also crucial as far as quality is concerned. Capacity building should be spread not only to the technocrats but also at the management level of the organization (Dewey, 1958, p. 149).
2. Attain competitive edge: – Competitive edge over competitors will give the firm monopoly of offering business courses to the market. Competitive advantage can be attained through technology and other innovative means to achieve organizational market targets. The firm will have to conduct survey in order to benchmark its services with other firms providing the same services. Extensive marketing is also a significant aspect. The firm may utilize information technology modes such as internet to market its courses to institutions around the world.
3. Staffing-DL limited is an upcoming company dealing in distance learning program. The company is to be launched within three months of its initiation. It will require human capital to operate. Specialist in different areas of operation within the firm will need to be recruited through a very competitive method. The main objective is to ensure quality service to the customer (Namuth, et al. 2005).
4. New products:-DL limited is mandated to provide undergraduate degree courses in business courses. The firm will also provide a course curriculum accepted by the by the client universities. The firm also will have to provide and information technology course as a common unit to compliment these courses such that one will have a degree in relevant business course and a diploma in information technology. Full time undergraduate course in business will take three years plus one year in information technology diploma. This will be made possible in collaboration with four renowned UK University namely University of Leeds, University of Nottingham, University of Warwick, and University of Greenwich (Clark, 1994, p. 454).
5. Pricing for the courses: – The business courses will be offered in international pricing standards. Each course will be charged differently as follows.

An additional tuition fee of £1000 will charged for an extra diploma course in information technology, which will take a period of one year.

Business Strategies

DL limited will consider the following strategies for achievement of its goals and objectives. Administration will involve putting up technical team and management group to provide an operational mechanism to the new organization. The top organizational structure follows the below model (Dede, 1996).

The top management will provide leadership for the whole organization. The technical department will have to develop information communication systems that will enable distance learning possible (Bransford, 1998). The operations department will be responsible for the academic part of the system include course monitoring and evaluation of the model. At operational level, there will be unit instructors and lecturers.

The mode of learning will involve web approach, video conferencing, and e-mailing. A website for the firm will be developed to include all courses and an online subscription. Payment of tuition fee and online learning will be made possible by this website. The technical team will also be responsible for system maintenance and support (Dede, 2000, p. 58).

Pricing of the courses was reached after survey of tuition costs charged by competing firm and projected operational costs in initiating the firm. The tuition fee will be determined by variety of factors such as cost of investment, competitors pricing and global market pricing. The price reached for offered business meets the international standards and affordable (Nash, 2005).

In ensuring quality learning, the company will provide the latest technologies in its model. Use of communication tools such as e-mail and the firm’s website to share and discuss educational topics and materials will be a step towards offering superior platform of learning (Brown, Collins & Duguid, 1989).

The learning services in the web will provide registration of the preferred online course and interactive tutorials by the instructor. The systems also enable the students to create at while they will be authenticated by using a password. This will enable the student to check the learning topics and assignment. The system also provides online library for references and research (Edelson & Gordin, 1999, p. 399).

In exploring new market, DL limited will have to develop a marketing plan. This market plan will explore the use of internet facility to advertise distance-learning courses. The firm will use social sites such as twitter and face book to bring awareness to the institutions courses (Otterbourg, 1998).

A market department under head of operations will be formed and its representative will have an office in Kenya to represent the Africa market and another office in India to represent the Asian market. These two outlets will be responsible for marketing the firm and offering any support services to institution that enroll to the program.

These marketing units will link up with universities and sell the firms products to these institutions (Dewey, p. 1958). Outsourced private firm will be responsible for selection and recruitment of the support staff for the firm. The contracted firm will advertise for both managerial and operational positions posts and later carry out interviews for these positions.

Key competencies that will be looked for during the interviews are experience and skill in the operation of distance learning (Knowles, 1984). For managerial position, management skills and experience will be the competences required. The resources will determine the number of staff and the number subscribed student on the model.

The lecturer and instructor will be academician will years of experience in the relevant business course (Carrol & Rosson, 2005, p. 8). DL limited also intends gain competitive edge by using the latest technologies in the communication sector. Use of social sites to market and as a means of communication to students is one of the strategies the firm is willing to explore.

By concentrating in business courses, the firm is segmenting the market based on subject of offer and this will enable the firm concentrate more on its core business (Bangert-Drowns, et al. 1991). Competitive edge will also be acquired the nature of the service provider and it is for this reason that the firm will be hiring the most qualified and experienced working personnel (Clark, 1983, p. 452).

Strategy for implementing a Distance learning process source: UNCTAD report January 2004

Advantages of Distance Leaning Over Conventional Model

The student does not require hall of residence or a traditional classroom to pursue education while the service provider cuts cost on elaborate organizational structure with employee to pay. Distance learning is accessible to everyone connected to the internet as the service can be accessed from any part of the globe with no time barrier (Gackowski, 2003).

Distance learning has more content in scope that traditional learning model does not have. Through e-learning, one can excess more and latest materials in the internet from any part of the world at any given time, the system is also efficient as it avoids the lock scheduling of classroom learning (Bielaczyc & Collins, 1999, p. 193).

Market Projection

The firm is on the growth stage of product life cycle and projects to be enroll about 500 students annually. This will require extensive marketing campaign in the regional of interest i.e. African and Asia.In projecting future demand the firm need to assess the competition, customer, and product (Clark & Solomon, 1986).

Competition will affect the market share of the company and therefore it is important for DL limited to explore other innovative means in administering this model of learning in order to stay ahead of the competition. Product development is another method of obtaining a competitive edge. The enroll program will commence on January 2012.The projections for the next 5 years (Linn, Bell & His, 1998).

The estimates show that by the firm will be having at least 8700 students with the first lot having successfully completed the course.

Financial Budget and Projection

This section will provide an estimate initial budget of developing distance-learning centre. The set-up costs of DL limited will involve course development, web portals, and general operating overheads at a cost of £300,000.This amount is projected to initiate the cost of establishing DL limited (Malaxa & Douglas, 2005).

Risk Management

Risk management involves identifying and assessing the risk factors with intention to minimize their impact in the organization. Risks lurk in every aspect of the business. They vary from competitor innovations to new technology in the market. These dynamics in the market bring about disruption to the operational consistency in the organization (Kaplan-Leiserson, 1999).There are risks that can be controlled and those that cannot.

The role of top management of DL limited will be to develop a strategic plan for the risks both internal and external risks. Risk factor may range from competition and Technological changes in the business environment. In the mode, learning which is via the web, viruses and hacking may be major causes of concern.

There is also a risk potential of service quality during the delivery stage (Koohang & Harman, 2005). Market risk is the potential of viable market not materializing as projected i.e. in Asia and Africa Economic risk such as recession is factors that have to be considered when projecting the future demand.

The company has to prepare to counter these uncertainties and mitigate the environmental risk factors. Risk management is the process of identifying, assessing, and prioritizing risks factors in order to minimize and control its impact in an organization. The first step in risk management is to identify the kind of potential risk a business is to identify the risk factors the firm exposed to.

This is done by examining the external and internal environment for drivers of the risks (Hayhoe, 1998, p. 76). Risk management involves Identify business process and function in an organization than are vulnerable to the risk factors by

1. Rank these functions and processes in order of their vulnerability to risk factors.
2. Identify threats of risk to these business functions and processes.
3. Determine the specific risk to each process and function.
4. Put up appropriate resources and plans s in place to deal with the risk factors.

References

Bangert-Drowns, R. et al. (1991) The instructional effects of feedback in test-like events, Review of Educational Research, 61, 213-238.

Bransford, J. (1998) Doing with understanding: Lessons from research on problem and project-based learning. Journal of the Learning Sciences, 3/4, 271-312.

Barrows, H. S. (1994) Problem-Based Learning Applied to Medical Education. School of Medicine. Springfield, IL: Southern Illinois University.

Bielaczyc, K., & Collins, A. (1999). Learning communities in classrooms: A reconceptualization of educational practice. In C. M. Reigeluth (Ed.), Instructional design theories and models: A new paradigm of instructional theory, Vol. 2, pp. 188-228.

Brown, J. S., Collins, A., & Duguid, P. (1989) Situated cognition and the culture of learning. Educational Researcher, 32-42.

Campbell, R. J. (2000). Descending into the maelstrom of the 21st century with Marshall McLuhan, Educational Technology, 40(5), 18-27.

Carrol, J. M., & Rosson, M. B. (2005). Toward even more authentic case based learning. Educational Technology, 45(6), 5-11.

Clark, R. E. (1983). Reconsidering research on learning from media. Review of Educational Research, 53(4), 445-460.

Clark, R. E. (1994). Media will never influence learning. Educational Technology Research and Development, 53(2), 21-30.

Clark, R. & Solomon, G. (1986) Media in teaching. In M. Wittrock (Ed.), Handbook of Research on Teaching, 3 Ed, New York: Macmillan.

Dede, C. (1996) Emerging technologies and distributed learning. American Journal of Distance Education, 10(2), 4-36.

Dede, C. (2000). Emerging technologies and distributed learning in higher education. In D. Hanna (Ed.), Higher education in an era of digital competition: Choices and challenges. New York: Atwood. pp. 55-64.

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Goal (Specific, measurable, attainable, relevant, timely)

1. The main goal is to deliver security protection over Cloud to savvy mobile device users (software version) and businesses (hardware version). “Security, trust, dependability and privacy are issues that have to be considered over the whole life-cycle of the system and software development from gathering requirements to deploying the system and service in practice” (Röning).
2. Secondly, to popularise our Cloud Sec market by the late of 2012. Looking to the fact that mobile phones are becoming popular, it is expected that if a proper marketing plan is formulated, the product Clod Sec will be a huge success.
3. Finally, to bring revolution in the security aspect of smart mobile device sector. The number of mobile users is increasing day by day and so are the frauds pertaining to mobile phone users. The mobile culture has overrun the sales of all devices. “Mobile is disrupting many industries – two of the most prominent being media and commerce and it is all driven by how consumers perceive the value of mobility, how they interact with content and devices” (Sharma). In such circumstances, it is the necessity of the moment that some security is provided to the mobile phone users.

Value propositions – benefits

• Security- Our product is aiming to provide enhanced security over Cloud, which includes user’s day to day software applications. If you feel unsecure because the photo in your iPhone automatically goes into Cloud and it can be exposed to others via text messaging between friends then Cloud Sec will make you feel secure.
• Seamless integration- Cloud Sec provides seamless integration to all of the current smart mobile devices that use a software market. The user interface is very friendly which brings high simplicity. All that the users need to do is to have our product downloaded and installed on their smart devices with a few presses in setting up. Cloud Sec will operate in the background just like the antivirus software on your PC.
• Economical- Cloud Sec has similar functions as VPN, but is a lot cheaper. With Cloud Sec application, you only need to make single purchase and receive benefits of multiple applications and lifetime updating.
• Mass market- Unlike VPN which is costly for individual to apply, Cloud Sec is ideal for individuals and is also designed to be powerful for business demands. Cloud Sec has software version which will be available for download via the Android and Apple markets. It also has hardware version which could be likened to Google servers. For businesses that demand additional security to their already full product line, Cloud Sec is the best choice.

Value Chain

The sudden rise of Skype to be globally accepted as a favoured means of communication shocked the entire telecommunication sector. Actually, the one who starts any particular feature is always the winner. “Fuelled by the increasing saturation of mobile technology, such as phones and personal digital assistants (PDAs), m-commerce promises to inject considerable change into the way certain activities are conducted” (Barnes).

The investment done by the promoters of Skype was not much but the idea was unique and people liked it. Similarly, by launching Clod Sec we expect to have the benefits of the torch bearers. Being reasonable priced and of innovative idea, our product is bound to have an encouraging response from the masses.

Trade Offs (Can’t be the best & cheapest at the same time)

As we initially target the mass market with pricing at $29.95, we lose the significant opportunity to position Cloud Sec in the field of high-level software application. This creates major challenge if we want to enter into high-level software application market later as our business successfully grows. However, in return we receive characteristic of affordability and revenue at the beginning of product launch.

As Cloud Sec heavily positions itself as security appliance, it may face tough competition immediately after its launch. As a result, market share could be possible to be taken by other innovative and competitive similar security appliances. However, the centralised focus on security will have large impact on customer like the way Google did.

When Google came out, its design was very focused as just a simple search bar on the webpage. Although many better search engines came out later on, but Google by that time had already dominated the market. Similarly, Cloud Sec initially is very focused on providing security support. Therefore an equal sign is there when ever customers hear Cloud Sec or security.

FIT (How to keep on being the best?)

In the introduction and growth stages of product “Cloud Sec” lifecycle, we only focus on one market which mainly targets at providing security. We run the business with previously stated objectives and our product uniqueness. In the mature stage of product lifecycle, we will still focus on developing “Cloud Sec” competitive advantage based on its natural core functions.

However, we may introduce new features and extend the business to reflect the market. As the market and customer needs are highly unpredicted, we have organised team structure and clear assignment of responsibilities as shown in the following diagram. “Organizational structure is particularly important for decision making” (Suttle). We have each part of the business integrated with others in managing to deliver the right product to the demanded users in a timely manner.

Continuity of Direction

Periodic meetings help in understanding the latest market trends. The business can be followed up constantly and if any changes in the plan are felt necessary, the same can be done. As a result, the business is expected to be on the right track. “Directors may find it makes sense to set up a schedule of periodic meetings – to be held quarterly, for example – that take place on certain fixed dates” (Steingold & Steingold 2010).

It is very important to do frequent analysis of the business. There are various methods available but the most commonly used methods are the SWOT analysis and the PESTEL analysis. SWOT means the strengths, weaknesses, opportunities and threats of any business. PESTEL means the political, economical, social, technological, environmental and legal aspects that may have impact on any business.

Doing these analyses will bring forward all the facts and figures of the business. “To help make decisions and to plan for future events, organizations need to understand the wider ‘meso-economic’ and ‘macro-economic’ environments in which they operate” (CIPD). We surely will benefit from these analyses.

Customer satisfaction is of utmost importance in any sort of business. The feedback from customers, by way of surveys, will help us in knowing the drawbacks and plus points of our product. Simultaneously, we can make the required changes in our product to make it more user-friendly. “A business is composed of a number of different people who exert influence on the company’s buying decision, while a consumer is a person who conclusively makes the purchasing decision” (Manalastas 2010).

We understand that proper monitoring is required in order to ascertain that we are on the right path and are working towards achieving our goals. A better way to achieve goals is to set milestones. This makes the process of achieving goals easier and the business moves ahead in a systematic manner. “Monitoring allows correcting before it’s too late, and allows uncovering drift away from the goals, or costly ‘repairs’ if the goals aren’t being achieved” (Bacal).

References

Bacal, R., How does Monitoring Progress Towards Strategic Goals Result in Better Implementation? Web.

Barnes, S. J. 2002, ‘The Mobile Commerce Value Chain: Analysis and Future Developments’, International Journal of Information Management, vol. 22, pp. 91-108.

CIPD 2010, PESTLE Analysis. Web.

Manalastas, R. C. 2010, How to Ensure Customer Satisfaction in Business-to-business (B2B) Selling Relationship. Web.

Röning, J., Cloud Security. Web.

Sharma, C. 2012, Mobile Breakfast Series – How Mobile is Impacting Media, Commerce, and Consumer Behaviour. Web.

Steingold, F. S. & Steingold, F 2010, Legal Forms of Starting & Running a Small Business, Nolo, USA.

Suttle, R., The Importance of Organizational Structure. Web.

Background Information

KenSpo is a private limited enterprise that operates in the US footwear and apparel industry. The firm deals in designing and production of high-end fashion footwear and apparel products. In the course of its operation, KenSpo intends to maximize its profitability potential hence its competitiveness.

Moreover, the firm also intends to attain an optimal market position within the footwear and apparel market by producing high-quality footwear and apparel products.

Thus, the firm appreciates the importance of product development in its strategic management process. To achieve this, the firm has incorporated research and development among its best management practices.

After conducting a comprehensive environmental scan, the firm has identified a market opportunity with regard to development of sports sneakers. To exploit this market opportunity, the firm intends to design and produce a unique sports sneaker.

Objective

Main Objective

By producing the new sneaker, KenSpo intends to achieve the following;

1. To attain a 15% market share in the US sports sneaker market in 5 years.
2. To diversify into different sports products by engaging in product line extension in order to attain a high competitive advantage.

Short Term Objective

The firm is of the objective that the new sports shoe will boost its annual financial performance considerably. Upon its introduction, it is expected that the new sports shoe will increase the firm’s net profit with a margin of 10% within one year.

Additionally, KenSpo intends to attain sales revenue of $5 million within 1year after launching the product.

Source of Funds

The process of designing and production of the new sports shoe will exclusively be funded using a bank loan. The amount being sought for the entire project is $ 1.5 million that will be repaid in 1.5 years. Decision to fund the new product using loan was informed be need to invest retained earnings in other ventures.

Business Premises and Location

KenSpo will establish a well designed business premises that will strategically be located in Ann Arbor, Michigan. The premises will exclusively carry the new sports shoe product.

Decision to locate the premises at Ann Arbor City is informed by the fact that the firm intends to exploit the business opportunity provided by numerous fans who attend NFL matches at Michigan Stadium.

Human Capital

In the course of its operation, KenSpo is committed at providing customers with high-quality products; consequently, the firm will outsource experienced sports footwear designers to aid in the designing and development of the new shoe.

This will aid in ensuring that the new sports shoe is of high quality in addition to meeting the sports shoe specification.

Customers, Competitors and Promotion

KenSpo appreciates the importance of conducting comprehensive market research in an effort to attain a high competitive advantage. Consequently, the firm has integrated both competitor and consumer market research. The market research aids the firm in the process of formulating its marketing strategies.

Findings of a market research conducted by the firm revealed that there is high market prospect for sports products in the US. The demand for sports apparel and footwear is high across diverse customer categories. Consequently, the firm mainly targets both youthful and elderly sports fans.

Competitor Analysis

The US sports and footwear market is relatively large in nature. Moreover, the market has a high growth potential as a result of the large number of consumers who are increasingly appreciating sports.

A study conducted by the Sports Goods Manufacturers Association in 2012 revealed that sports footwear products account for 35% of the total footwear market in the US. This indicates that there is a high growth potential.

The high growth potential has led to a high rate of market entry by both large and small enterprises in order to serve the high market demand. Consequently, KenSpo will experience intense competition from both local and international firms.

Some of the firms that will be a threat to the firm’s market penetration effort include Fila, New Balance Athletics, Nike, Addidas, Reebok and Puma which have already attained an optimal market position.

Product Promotion Strategy

To ensure that the new sports shoe is successful upon its market introduction, KenSpo will incorporate a comprehensive promotion strategy. The strategy will take into account Integrated Marketing Communication (IMC).

Decision to use IMC was informed by the need to create sufficient market awareness on the new shoe product. The IMC promotion strategy will incorporate both offline and online promotion methods. Some of the methods that will be used include use of advertisements, sales promotion and public relations.

Diverse market awareness tools which include traditional and emerging marketing communication tools will be used.

Examples of traditional advertising tools that will be used include television and print media. Social networking technologies such as Blogs, Wikis, YouTube and Facebook will also be incorporated in creating market awareness.

Pricing Strategy

KenSpo will ensure that the new shoe product is well-priced in order to attract potential customers. In the market introduction phase, a penetration pricing strategy will be used. The price point of the new sneaker will be set at $ 129.

This shows that a psychological pricing strategy will be used in order to appeal to customers’ emotions in their purchasing process.

Sales Forecasts, Costs, Profit Forecast

By introducing the new sneaker, KenSpo expects to attain sales revenue of $5 million within 6 months after launching the product. Additionally, the firm has projected to attain a profit of $ 3 million within one year.

To attain the projected sales revenue, KenSpo will ensure that the new sneaker successfully penetrates the market. To achieve this, KenSpo will incur a considerable amount of cost. The chart below illustrates a summary of the cost that the firm expects to incur.

Reasons Why the Business Will Succeed

Findings of a market research conducted by a number of KenSpo’s departments which include the marketing and the research and development departments reveal that there is a high probability of the new sneaker gaining sufficient market acceptance upon its introduction in the market.

One of the factors that will enhance its acceptance relates to the high rate at which consumers in the US are appreciating sports in their consumption patterns. Additionally, the product will be of high quality hence satisfying the customers’ needs.

As a result, there is a high likelihood of the sneaker appealing to a large number of potential consumers’ hence increasing efficiency with which it will attain the break-even point.

Cash Flow Statement

The chart below illustrates the expected cash flow statement for KenSpo for the first one year upon launching the new sneaker.

Business overview

After carrying out a survey in the state of Florida, I realized that the state has many physical fitness clubs where people go for exercising. I bet this is because of the increasing concern for the increasing rate of diseases that are related to obesity.

Obesity is a disease that is caused by unhealthy eating and lack of exercises; people with this condition have a high risk of developing heart diseases, high blood pressure, and even diabetes (Zimmerman 136). Doing exercises and eating healthy foods are among the recommended activities to keep the disease at bay.

Having exercise is a healthy thing to do; however, they should be accompanied by health services such as personal advices on healthy eating, recommended exercises as well as healthy practices.

This realization led me to a plan to join with John Lewis to start “Stay Fit and Healthy Club”. This club was started in June 2011 with an aim of providing fitness as well as health services to the people of Coral Gambles region; these services will be of high quality and at a low cost.

Mission

Mission of Stay Fit and Healthy Club is to provide training programs that relate to health care services and come up with strategies that will promote healthy living among the people of Florida, as well as creating awareness on the diseases caused by obesity and overweight

Strengths of Stay Fit and Healthy

• The club is committed to providing health care services to its customers.
• The club has qualified trainers with high reputation.
• The club provides services at a cost that is lower than its competitors.

Challenges

Stay Fit and Healthy has a challenges of attracting more customers to experience the new services; this is because this region has a lot of Gyms and training clubs which are more established and have permanent customers. The competitors include Coral Gables and Gold’s Gym.

Industry assessment

This is a health service facility and it intends to give health care services as well as services using specialized equipment. This facility will serve customers of all genders; however, customers of female gender will have special attention of being treated with training with female trainers.

This does not mean that men customers will not be treated to quality services, because the environment in the facility gives the customer a comfortable experience during the exercising session.

In 2006, there was a survey carried out, according to the survey, there were 29,069 health clubs and this clubs has approximately 41.3 million members. Approximately 49.9% of the health clubs were recorded in Alabama, Michigan, Massachusetts, Illinois, Ohio, Pennsylvania, Florida, Texas, New York and California, with California having a highest percentage of 11%, while Florida has only 6%.

This means that there is still untapped potential both in the State of Florida and other states. The industry has no strict regulations, however, a license is required for its operation, and as usual, payment of tax on the profit earned is mandatory.

Scope of services

Stay Fit and Healthy club’s customers will experience a wide variety of services related to health, this services will include obesity control, diabetes control, training of muscles, pilates, yoga, boxing, cycling and aerobics. These services will be provided using the latest equipment that are installed in the facility and are bought from quality manufacturers.

The costs will be on monthly, quarterly and annual basis, and customers are guaranteed to have low costs on each of these subscription plan.

The qualified personnel of this facility will help members achieve their set goals within a short time. for those who prefer exercising at home, we will also sell to them training equipments at an affordable price. The sales will be accompanied by training manual as well as the use of the purchased equipment.

The necessity of the facility to the people

Many people visiting health care and physical fitness clubs in Florida consists of high income earners; this means that most of the middle income earners as well as low income earners are left out of this vital service (Sherrill 396).

Also according to research, most people affected by obesity and overweight are the low income earners, this is because of their poor eating habits, lack of exercising, and most of them do not take health care as a priority (Zimmerman 140).

Those who are diagnosed with obesity do not seek medical attention because, they cannot afford the treatment, therefore, they live with the condition, which eventually resulted to chronic diseases such as diabetes and cardiovascular disease.

This club looks forward to alleviate the situation; Stay Fit and Healthy Club will make sure that the needs of the population that has been left out will be met by providing health care and physical services at a lower cost, making it affordable to the majority.

Market of Health and Physical fitness industry

America has 29,636 health clubs and approximately 41.5 million people visit these clubs, among the clubs in the United States of America, there are 20.4 million members visiting commercial health clubs, and 17.2 million visit non-profit health clubs (American Bureau of Statistics 176).

Florida approximately 6% of the 29,069 clubs in the United States, in 1995, the state had 863 clubs which grew by approximately 9.59% as recorded in 2007. This shows that the health and fitness industry is still in the stage of growth; currently customers in this industry have grown to 41.3 millions, and the market penetration is only 14% in the whole America American Bureau of Statistics.

This is an indication that there is still a huge potential in this industry now and in the future. In addition, this is a business that runs smoothly, therefore, there should be no worries on the business low and high season; this means that any established club should have a constant number of customers throughout the year.

Health and physical fitness industry in America has recorded a high growth rate for the last 10 years, and according to survey in 2007, the number of people visiting health and physical fitness rose to 2007 and the number is said to be increasing each year. Among the 41.3 million, 52% are female and 48% are male, and the average income per year, per member is 76,000.

Each member attends health club sessions for approximately 92 days per year, and for those who visit the club, they mostly use personal training program. The health and physical industry in the United States has d in the use of cardiovascular equipment; this means that almost every health club has the equipment (Wilson 312).

Market scope

The City of Miami has approximately 1.28 million members, and when Miami-Dante County is included the population becomes 2.82 million; Stay Fit and Healthy Club is expected to reach this population, although at the moment, only 45.3% are recorded as health club attendants.

The health and physical fitness club has grown rapidly during the last decade, in the year 2007, the market recorded $17.6 billion; this was more than double the market in 1995, which was at %7.8 billion (American Bureau of Statistics 196), and in the year 2010, the market was at $19.6 billion.

This trend only shows that the market is growing at a fair rate and investment in this industry is promising an increase in the number of people visiting health clubs.

The growth is triggered by the health care expenditure among the people of America; in 1997, the nation spent approximately 1.1 trillion, in 2007, the expenditure grew at 9.92%, this translated to 2.24 trillion. This shows that the health care expenditure for United States increases to more than double after a decade, and therefore, in the year 2017, the nation’s expenditure will increase to more than 4.4 trillion.

Looking at the expenditure in details, records shows that obesity takes up, 10% of the expenditure, this means that the number of people with obesity in the United States also increases each year, and therefore, more people are seeking help in health clubs.

Demand for health and fitness services

The demand for health club is really increasing more and more as time goes by. Many people are already members of health clubs and other are willing to join the clubs, while others are also interested in subscribing at least to one of the programs offered in health clubs.

This is because most of these people have been recommended by medical professionals to join health clubs and others feel that they require some time in a health club to improve or maintain their health status. Also, most people do not like vigorous exercises; therefore, they are seeking to have exercises in health clubs because they are adoptable and the exercise sessions are aided by professional trainers.

As people join health clubs they are committed to improving the whatever situation that compelled them to join the club, therefore, they are so demanding, and they expect results within a short time.

Such cases are sorted out quickly by professional trainers who set up a plan for each member according to the requirements and demand, and this helps them achieve results as expected. Many people, therefore, choose to be members of health clubs so as to meet their health and physical fitness requirements.

The demand for health clubs has been increasing since the last decade; this is attributed to the increasing income per capita in the United States. The increase in income per capital has made many American focus more on issues affecting their health, therefore, lack of exercise being one of the issues, and more people are subscribing to gyms and health clubs to eliminate the menace of obesity and diseases related to obesity.

The only thing that is making other people shy away from seeking help in gyms and health clubs is the issue of cost of services offered. Many are willing to visit these facilities but, the extra money they have for such services is not enough to secure then a one-quarter a year or even a one-month subscription; this is affecting the growth of health and physical fitness industry.

Looking at the market trend on health clubs in the United States, it is evident that the trend is changing rapidly; many people have resolved to using equipment to do their training and exercises, and most of the consider exercising as a daily routine.

This has led to the increasing memberships in health clubs, also, in companies have decided to make health membership as a package in the employee remuneration, thus making the market trend take an increasing trend.

Market potential

Those people in the health care club industry still have a bright future for their business, this is because of the untapped potential in this industry, and the same applies to those who still want to join the industry as new investors.

The market in this industry has reached close to 60 million registered members, which translates to $31.8 billion revenue per year; the increase is overwhelming considering that in the year 2005, the market had revenue of $17.6 billion (Piers 275). This growth is attributed to the increasing health care expenditure, this year; the expenditure is expected to increase to $2.93 trillion.

Market opportunities

The industry has a lot of opportunities; these opportunities are enough for those who have established in health care club business, as well as those who want to join the industry.

According to the survey carried out in 2007, 300 million people around the globe have been affected by obesity, and considering those affected by overweight in United States, the number is approximately 130 million, and among these people 61 million are obese.

The issue does not only affect adults, but also young children, according to the 2007 survey, 15% of children living in America are overweight (Powell, 136). Obesity is a condition that leads to other chronic health conditions such as diabetes, and according to research, 18 million of the United States people living with diabetes suffer from heart diseases and are affected by high blood pressure.

Future plans in service provision

Stay Fit and Healthy Club wants to provide health care as well as fitness services, however, the club is not limited to these two major services.

In the future, this facility plans to expand on its services to public awareness creation on chronic diseases, particularly those influenced by obesity and overweight; these services will be like an after sell service, whereby, members who have subscribed at the facility will receive the service free of charge. In the future, this business will not only offer health and physical services in Coral and Gamble, but also in other parts of America.

Target group

The club operates in Miami; however, it serves 21.7 of the population, which has 1,691 clubs of the same kind. According to the census report carried out in 2007, Miami had a population of 2,828,649, this was an increase when it is compared to the census carried out in 1990; the 1990 population was 2,295,937, the increase was equal to 1.36%.

The population of this town is estimated to 3 million by the end of this year. The average income of the household in this town is estimated as $53,408, this is according to the government of Miami.

This club targets the market in Coral Gable town, which has 42,794 people, however, only 2,636 are potential customers, and their earnings are below $25,000 per year. Potential customer takes about 15.51% of 16,994 households in the city of Coral Gambles.

This section of the population in this city is untouched by the great health clubs, therefore, Stay Fit and Healthy club will work hard to first capture the untouched population before embarking on attracting customers from its competitors.

Competitors

Stay Fit and Healthy Club is not the only club offering health and fitness services, there are other clubs offering the services, therefore we understand that there is competition.

The club includes Coral Gamble and Gold’s Gym among others, Coral Gambles offers services such as pilates, fitness kick boxing, short distance running, core conditioning, sport yoga, hiking, circuit training, jumping rope, muscular strength.

The Gold’s Gym offers services such as youth fitness, senior, fitness, sports training, medical information related to fitness, pilates, yoga, group spinning, diet and training, strength training, pre and post natal.

Focusing on Coral Gambles, Stay Fit and Healthy Club will aim at providing to low income population, which are not provided by the competitors. The low income earners, as we have seen they are about 6.1% of the population in Coral Gambles (Kelly 212). Stay Fit and Healthy Club, plans to attract masses more members by providing low prices at the beginning, and then later set a price that is more competitors.

Marketing strategy

First, we all know that people places that have value and low cost on services they offer, therefore, we shall use this strategy to more customers. We will make sure to have the latest equipment in the club; to ensure quality of the equipment; we shall make our purchases from quality manufacturers.

Members will be required to subscribe on annual, quarterly, and monthly basis, and this subscription will be at a lower cost. For the start, we plan to charge $95 for the body workout exercises. We plan not to waste no one’s time; therefore, we plan on concentrating on efficiency by use of qualified trainers to meet our customers’ needs in time.

Technology is of the essence in marketing, and because most people communicate more using the internet, we plan to utilize a website as a marketing media; we will create a website to create an image as well as brand for the company, this will help the club to have an identity (Active marketing group 406).

In addition, using the website, the club will give the new members and old members to make their subscription; this will save them all the procedure that might come with subscribing at the club’s offices.

Stay Fit and Healthy Club will first target the population with the low income in the Coral Gamble area. This people will be taught the benefits of health and fitness programs.

This will be a bit tasking because we have to arrange for small public gatherings and send letters and emails to those we cannot reach personally or in gatherings. Marketing of Stay Fit and Healthy Club will use approximately $5,000; these funds will be used for posting advertisement on radio, television and newspaper.

SWOT Analysis

Strength of Stay Fit and Healthy Club

Stay Fit and Healthy Club is committed to providing services that are result oriented strategy to attract new members and maintain the old ones. The club’s programs are designed to meet the needs of a layman, and services are affordable and of a high quality. The club will also hire well trained and qualified trainers, who will guide customers during their training or exercising sessions.

Weaknesses

We plan to provide high quality services at a low cost, these might cost us a lot because high quality equipments are costly, and hiring of highly qualified trainers is expensive and costly to maintain them; they demand high salaries, and any failure to satisfy them make them seek greener pastures.

Stay Fit and Healthy Club, also has a weakness in the number of members it has; the staff cannot provide services to the expected large number of people in the club. This might lead to the provision of services that are not of good quality, and the members might feel neglected and later quit using our services.

This club also needs to be advertised widely; the club is expected to serve a wide area, therefore, the club should be advertised well within the area and beyond.

This club is challenged in terms of marketing budget, especially marketing to clients who have large businesses; it is a challenge because most of them are used to going to already established health clubs, while those who do not go to these clubs claimed to lack enough time to go for practice attend our public awareness campaign meetings.

This is an untapped market and to capture this market we need more funds to arrange for even personal meetings with the large business clients.

Opportunities

The health and fitness industry is growing at a high rate, and opportunities are increasing as well. America has an increase in the cases of obesity and diseases that are related to it; it is the increase in this cases that are compelling people to pay more attention to health care activities and exercising.

Therefore, we are going to take advantage of their increasing concern on health to give them with a club that will meet their health care and exercise needs. We are also glad that American People take visiting health clubs and gym as part of their daily routine, and this a behavior that is favoring our business idea; I think we should work extra hard to make more and more people to make a visit to our club a daily routine.

We still lucky that the market of health care and physical fitness in Miami and most parts in the United States is still untapped, the target in this case will be low income earners, who seem to be left out in health care activities and physical exercises because of high costs.

Threats

When starting a business there are some things, which are beyond one’s control; this things include recession and economic downfall. These are things slow down the growth of Stay Fit and Healthy Club, as well as other clubs; recession and economic downfall, changes the spending of people and this will be the same to the people visiting health care clubs, and this will slow down the growth.

Another thing is that we promise to offer low costs for our services, however, our competitor might choose to lower their prices as well, and this might not work well on our side because we are still new in this industry.

If this happens, then it means that we might not even be noticed, however, we do not consider it as a big threat because we have other strategies. Additionally, most health care equipments are cheap, and most people have them at home for their exercise; this is a threat to the growth of Stay Fit and Healthy Club and other health clubs because those who have exercise equipments would not go to health care clubs.

Marketing mix

Stay Fit and Healthy Club need to have a good market mix, which will include cost, product, advertising and publicity. In the case of services, Stay Fit and Healthy Club will offer health care services such as obesity and diabetes control, muscle training, pilates, yoga, kick boxing, cycling and aerobics.

Pricing of services offered by Stay Fit and Healthy Club is a challenge because of the high competition for health care and physical activities market in the Coral Gambles region.

Therefore, for Stay Fit and Healthy Club to survive the competition, it has to offer quality services at a lower cost than its competitors. We have chosen $95 for basic exercises and body workout, and the cost for other services will be lower than the cost offered by competitors.

Stay Fit and Healthy Club, is strategically placed near the city’s main street, this is to make the club visible by anyone using the road network. Stay Fit and Healthy Club will also be promoted well to make sure that it is known by people living in the Coral Gable region; this will be done using radio, television, magazines and newspapers, as well as use of the internet.

We will also use brochures to create awareness on the health care services provided by Stay Fit and Healthy Club.; the brochures will be distributed in public gatherings and seminars organized by officials from Stay Fit and Healthy Club.

Management of the Club

John Lewis

John will be the overall operational manager of Stay Fit and Healthy Club; he has an MBA in health Care management from Texas University. This is an individual who is inspired by health care as well as physical fitness activities, and has a passion of helping other people to live a healthy life. John was a general manager in a hospital in California.

This hospital was for people who needed therapy as well as nutritional advices; the people who visited the Hospital were those with diabetes, obesity and overweight, and also those who were recommended to do particular exercises for their limbs to function normally. During his contract at this hospital, he did an excellent work, which earned him a contract extension.

He has also been a financial analyst of 5 years, in Coca Cola Company, and during his five year term, he managed to help the company make good investment decisions that led to huge profits and growth. Apart from Coca Cola Company, he has also worked with companies in line of Health care services; these companies include Health Care IT Transition and Dentimax.

Jimmy Johnson

This is a co-owner of the club and is also a sales manager. Jimmy has an MBA in sales and marketing; this is a qualification he acquired from the University of California. John has an eight-year experience as a sales and marketing manager in the following companies; Gentiva Health Services and Apria Healthcare Group.

We also plan to include bankers in the club, however, this will depend on the feasibility of the business; all in all we expect the club to be a success.

The club will not be complete with advisors, this is because we expect to create health awareness to the people before and after their fitness exercise, therefore, we will need two advisors, a female, who will be advising members who are ladies and a male advisor who will advise male members.

A nutritionist is also an important in this club, the members of the club need to be advised on healthy eating and living to avoid developing obesity and obesity related diseases. Therefore, the club has hired Whitney White, a professional nutritionist and a doctor who has been working at Jefferson Health System as a nutritionist advisor.

Financial plan

Initial Capital

Stay Fit and Healthy Club has an investment of $1,000,000; the owners raised this through savings.

Initial Expenses

Expenses for starting the club included

Expected revenue

During the first year, Stay Fit and Healthy club, expects to have 25,000 members, this will translate to $1,225,000. The revenues might be low because people are not yet used to the club and others are still visiting the health club they are used to.

The number of people visiting Stay Fit and Healthy club is expected to rise to 100,000 which will translate to the revenues of $4,900,000. The third year anticipated an increase that was more than that of the previous year; within three years, we expect to capture the market of the low income earners and the subsequent years will be focused on maintaining them and attracting those visiting the well established health clubs.

The club also plans to sale training equipment, we have realized that we might not attract all people to come to clubs for exercise, there are people who only like exercising at home, and to benefit from them as we help them out, we have decided to sell training equipment.

This will boost our revenue, because this will not only target those training from home, but also the other training and health clubs. This plan will take effect during the second financial year, and the revenue from the sales will bring to the business revenue of $35,000. The revenue from these sales is expected to increase to $42,000 in the third year of operation.

Operating expenses for the three years

Promotion

Expenditures for promotion for the first year will be $5,000, in the second year and the third year, the club will increase the cost of promotion to $6000. This is a crucial time and the club increases its expenditure to sensitize more people on the benefits of attending health clubs.

Consulting services

The club will have to consult a lot from the other clubs or those who have been in the health and fitness business; this will help the club to understand the dynamics experienced by businesses in this industry.

During the first year consulting expenses will be $90,000, and during the second year and the first year, consultation expenses will increase as the number of customers increase; more consultation will be to know much about the customers’ cases and needs. The consultation services will be $480,000 for the second and third year.

Expenditure on personnel is expected to increase as the business activities of the club progresses, and this would be $290,000, $840,000 and $940,000 for the first, second and third year respectively. Other expenses amount to $1,227,290, $2,474,580 and $4,073,500, for the first, second and third respectively. The club is expected to make a profit and during the first year the pre-tax profit will be at $322,900, the following year is anticipated to have a profit of $3,385,800, and the third year will have a pre-tax profit of $13,025,000.

Conclusion

According to the cash-flows I have given above, Stay Fit and Healthy club business is viable. If the business goes as planned and becomes successful, the expansion to other areas in the United States is a dream I would like to pursue.

The issue of obesity and obesity related diseases is not only experienced by individuals in the State of Florida, but also other parts of the United States, therefore, Stay Fit and Healthy is not a service meant for only people living in Florida, but Florida has been chosen as a starting point.

Works Cited

Active marketing group. Health club industry review, New York, USA: Active marketing group, 2007. Print.

American Bureau of Statistics. Population census 1995, Washington, USA: American Bureau of Statistics, 1995. Print.

American Bureau of Statistics. Population census 2007, Washington, USA: American Bureau of Statistics, 2007. Print.

Kelly, Peterson. “Health and fitness industry.” Business Journal, 2.3 (2006): 210-217. Print.

Piers, Elias. “Business opportunities in America.” Western business, 6.4 (2003): 267- 278. Print.

Powell, Gerry. Heath and Business, California,USA: SAGE Publications, 2010. Print.

Sherrill, Ally. Physical health industry analysis, New York, USA: United States Government Accountability Office, 2011. Print.

Wilson, Felix. Health alleviation in America, London, UK: Ashgate Publishing Limited, 2003. Print.

Zimmerman, Maurice. “Obesity in America.” Medical journal, 26.2 (2003): 117-141. Print.

Introduction

A marketing plan refers to a blue print that is developed and implemented by organizations for execution of their marketing strategies. It is a well-coordinated plan for orchestrating organization’s marketing functions (Applegate, & Johnson, 2007).

The organization aims at developing a marketing plan that is well-aligned with the organization goals and objectives. The retail chain of stores operates in Indianapolis with outlets, such as the Carmel, the Greenwood Park and the Circle Centre Malls.

The company has been in business for the last 5 years. Due to the significant growth of its sales in the past two years, it has managed to become one of the leading retail stores in Indianapolis. Indianapolis has a high level of population, and it is located in North America. The company under the study stocks specialty toys, gifts, and clothing among other products for customers in the region.

Currently, the price of the products ranges from $ 20 to $500. In line with the organization’s goal of achieving growth, the company aims at extending its market coverage to five other cities by establishing 2 or 3 stores in all those places during the period of the next 2 years.

After that, the organization plans to focus on its further expansion to cover a larger market in Indianapolis. This paper aims at presenting a marketing plan for the company’s development.

Market Analyses

Overall Marketing Strategy

The overall marketing strategy will be based on the organization’s goals and vision which will also be aligned with the organization’s corporate strategies. In this case, the organization presents varying types of goods with different price levels ranging from $20 to $ 500.

This implies that organization’s marketing strategy will be aimed at enhancing sales as well as market share of the company due to a wide price spread. The organization’s strategy will thus be tailored in such a way so as to offer the needed services to the mass market.

Discount pricing strategy will guide the generic strategy adopted by the organization in its overall marketing strategy. This will enhance the ability of the organization to extend its operations to diverse markets in Indianapolis.

Situational/Environmental Analyses

There are a number of factors that determine the cities in which organization should initiate its operations. One of these factors includes the level of population in the city. Higher level of the population in such cities means a wider market for the company to sell its services and goods as well as higher level of revenue.

The organization will equally prefer to operate in cities that are politically stable. It is worth noting that different cities or countries have a different level of social and political stability. Thirdly, the organization will run its business in the cities where the level of income among residents is high.

This will increase the customers’ ability to purchase the organization’s products. It will also expand to the regions where the local authorities’ regulations are in line with the organization’s operation goals and objectives.

The company will equally identify areas to enter where the level of competition is low. Finally, the organization will assess and enter into a market where the level of demand for its goods, specialty stores, as well as other products is high (Young et al, 2008).

Product Category

Although the organization presents a wide variety of product lines in the market, these products have different levels of profit margin as well as demand. The organization will engage in margin analyses for different product lines.

It will assess the level of demand for each of its products in potential markets it is to enter in two years, as well as in those in which it is to operate in five years. Once the levels of demands in each potential city are determined, the cost of producing and marketing such products will be defined.

The price for such products will thus be set considering the unit cost, desired margin levels, as well as the average market price for such products in these cities.

Selling price that is less than unit cost of different products demanded in different cities will give the company contribution margin. Such margin will be multiplied by the respective product demand in these cities. Products generating the highest level of profit will be launched in such markets (Young et al, 2008).

Target Customers

A marketing plan should have an objective that it is aimed at achieving its goal. Such a goal will include financial targets, such as growth in profit and sales revenue, among others.

On the other hand, a marketing plan may be aimed at growing the organization’s market share as well as its effectiveness in terms of communication. It can be tailored to achieve a certain price level, enhance quality of products and ensure customer satisfaction, among others.

Before the organization engages in its new outlet promotions and marketing campaigns, customer targeting will be carried out. There will be a need for the company to split the market into different sectors that share homogeneous characteristics.

The organization will segment the market and adopt the following targeting strategies, either differentiated marketing or undifferentiated marketing strategy. In this case, since the organization aims at presenting its product as a mass product, it will engage in undifferentiated marketing. Undifferentiated marketing is indicated in the diagram below:

Source: Learn Marketing.net (2012).

Under the above category, the organization will not focus on a certain segment of demographics in the city. It will target all the customers who demand its products presented in the different cities, regardless whether such customers are in the high or low end market.

The organization’s focal point will be on the low end market. Nevertheless, in its market communication strategy, the organization will ensure that such communication reaches the target customer.

This implies that when advertising its goods (toys in this case), the organization will develop advertisements that will easily get noticed by young children. It is worth noting that children are one of the main influencers in decision making in the toys market.

Branding Stores

Branding is one of the key drivers of success in organizations. It aims at increasing customer loyalty to organization’s products; enhancing the positive image of the firm as well as its products, besides generating positive brand image. In its marketing plan, an organization carries out competitors’ analyses.

The strengths of its competitors as well as their weaknesses are studied, and the companny then develops a mechanism on how to increase its competitiveness in the market. The availability of substitutable products is carried out.

This helps the organization in developing mechanisms on how to thrive amidst competition and promote its products in a market taking into account competing produces.

The baseline to the problem of substitutes is for the organization to develop innovative products for the next three years that would satisfy the needs of customers better than those of the competitors do (Young et al, 2008).

In this case, the organization will present quality products as well as quality services to its customers. This will significantly enhance their satisfaction. Responding to their queries in a timely manner will equally promote their brand loyalty.

On the other hand, to boost customer appreciation, a loyalty scheme will be established where customers earn redeemable points once they buy an item from the organization. This will discourage them from buying such products from other sellers.

Finally, to enhance customer retention, the organization will engage itself in reminder advertising as well as purchase software that manages customer relationships. This will increase the chances of repeat purchases in the organization by maintaining positive awareness and brand image after purchase.

Marketing Strategy

In the development of a marketing plan, the organization has an option of employing various marketing strategies in its operations. Such strategies include mass marketing as well as target marketing. Mass marketing refers to market delivery of homogenous solutions based on the premise that consumer needs are similar.

The organization can develop toys which are affordable not only by the high end markets but also the lower market segments. This implies that organization’s products’ promotions as well as its distribution channels will target the entire market.

This has the potential of increasing the market share in which the organization sells its products. On the other hand, it presents challenges where the consumer needs are rarely homogeneous. This implies that a company cannot fully meet the needs of its customers in the market by offering them a homogeneous product.

An organization has an opportunity of engaging in target marketing, which can involve niche marketing. Identifying a viable niche (a group of potential clients sharing similar characteristics), the organization can achieve this through segmentation.

Pricing

The bottom line to the marketing planning process is making sales. The organization needs to ensure that a price is set in order to maximize its returns, while remaining competitive in the market.

Nevertheless, the price for the organization products may vary later on due to changes in macro economic variables that affect inflation, demand for toys, gifts, clothing and other materials as well as supply for raw materials to produce those goods as well as other products.

Nevertheless, since the strategy for the organization in the next three years is to serve both the low and the upper market segments, its price needs to be differentiated accordingly (Young, et al, 2008).

Promotion

Promotion refers to one of P’s used in marketing of products that demand for effective communication regarding a product to customers in the market. This does not only help in creating awareness about a product in the market, but also serves as a reminder to existing customers to encourage them to purchase the product.

The company has used its website ‘our organization.com’ in the past, to promote its products worldwide, but due to the wide coverage usually presented by websites, the organization needs to move a step further and effectively enhance its customers’ awareness of the website in the market.

The organization will also need to ensure that the medium of communication used reaches the target market. This includes reaching the target market that is currently comprised of young people that are technologically savvy, willing to take the repositioned organization products which now will be computer based.

The organization can use TV, newspapers, billboards or even magazines to communicate to the market. The baseline to this is that whichever product is selected, it must be capable of reaching the target market.

Promotion of the organization products needs to target two groups of people in the market, which are influencers and decision makers (Applegate, & Johnson, 2007).

Social Responsibility and Its Communication

The organization will operate in a socially sustainable manner. To attain this goal, the organization will ensure that all of its products meet the health and safety requirements. The company will also engage in recycling of worn-out products collected from customers as well as other waste.

This will enhance its ability to protect environment. Finally, the organization will adopt carbon reduction strategies in its operations. This will reduce its carbon emissions by 30% in the coming year and 10% annually in the subsequent years.

This will significantly boost environmental sustainability in Brunt Land regarding the sustainable operations and development, where firms exploit current opportunities and resources without jeopardizing the ability of future generations and firms to exploit the same.

Implementation

Implementation of a marketing plan is the starting point to the achievement of organizations objectives. Irrespective of how good a marketing plan may be, if the plan is left unimplemented, it will remain a mere dream. The organization needs to classify its marketing objectives into corporate, functional and tactical ones.

Once the organization leadership provides the corporate level with resources needed to execute the marketing strategy, the marketing team needs to implement the functional level strategies including indentifying distribution channels, running promotion campaigns, working together with the production department to assign products the intended price as well as ensuring that products in the market are of the right quality.

Once these objectives are achieved, then the next step involves the development of action plans. Individuals are assigned tasks that they are supposed to carry out within a set time frame. Its strategies are converted to actions.

For instance, if the suggested promotion strategy is to set up of billboards, its actual implementation should be carried out. Sites are secured, and the billboard is erected or hired with the rest message on it. Implementation of a plan leads to the achievement of outcomes, which may or may not tally with what is projected (Armstrong & Kotler, 2010).

This calls for comparison of the plans with the laid out goals and projections. It is the marketing team’s role to ensure that significant deviations from the expected outcomes are quickly rectified in the light of the new information in the industry. Budgets will be based on the unit and fixed cost of production. Advertising costs will be maintained at 5% of sales.

Conclusion

The above presentation indicates the immense need of a marketing plan. It calls for the marketing units in an accounting entity to align with the marketing campaigns and the organization’s goals and objectives. It equally shows the need for marketing managers to understand market conditions, as well as country’s factors, which may have influence on the success of their products in the market.

An effective marketing mix is critical to the success of an organization’s marketing strategy. Nevertheless, in pursuit of increased sales or market share, there is increasing need for the organization to operate in a socially responsible manner. This significantly boosts its sustainability in the long run.

References

Applegate, A., & Johnson, A. (2007). Cases in advertising and marketing management. Toronto: Rowman & Littlefield.

Armstrong, G., & Kotler, P. (2010). Marketing: An Introduction: Global Edition. New York: Pearson.

Learn Marketing.net (2012). Market targeting options. Retrieved from http://www.learnmarketing.net/targeting.htm

Young, et al. (2008). Principles of marketing. UK: Rex Bookstores.

In the contemporary business world, many industries have been characterized by a very high level of competition. This has posed a great danger, especially to the new organizations venturing in the market. The cement industry in the US is one of the main industries that have been characterized by an increased level of competition where each organization is determined to win the largest share in the market.

The cement industry in the United States forms one of the strongest economic bases for the country. The United States is ranked among the top cement manufacturers all over the world (Economy Watch par 4). Other leading manufacturers include India and China. There are a total of 39 cement companies which are currently operating in the United States (Economy Watch par 2). These companies have a total of 115 plants, which are distributed in 36 states in the country.

A significant fraction of the country’s cement production is contributed by the largest company in the US cement industry. The industry has been largely characterized by large scale investment. This is because the industry is more effective in large scale operations. It requires a significant amount to install fixed capital requirements. This is one of the main factors that have locked many players from the industry.

Despite the high risks associated with an investment in the cement industry in the United States, there are many opportunities available. A new factory in the industry can significantly improve its performance in case it utilizes the available opportunities effectively. However, this will be largely determined by the management. One of the main opportunities available for the company is the unexploited market. There are several market opportunities available for the company.

In the cement industry, the issue of environment is very critical. ILK Cement will ensure that all the necessary measures are taken into consideration to maintain an environment friendly production process. This will be realized by the adoption of modern technology that minimizes the level of environment pollution.

For instance, the factory will guarantee minimum carbon dioxide emissions in all its plants. Therefore, ILK Cement has an opportunity of extending its market networks in such areas. One way through which the organization will exploit such market is by venturing into the foreign market. There are large unexploited foreign markets. These will significantly contribute to the company’s success.

Another advantage of the company is that it has an opportunity to apply the current technology in its plants. Most of the aged companies habitually apply the old technology in their plants. Therefore, ILK Cement is advantaged because it will apply the modern technology in all its plants. The level of technology applied in an organization can significantly affect its performance (Economy Watch par 4). Technological improvement has led to increased efficiency and effectiveness in many organizations (Clark 48).

Therefore, ILK Cement has an advantage over its rivals on the ground that the cement industry in the US is closely related with the construction industry. The rate of growth of the cement industry will largely be determined by the rate of growth of the construction industry.

When the construction industry is performing poorly, the cement industry will automatically be affected. However, cement is a compulsory material in almost every form of construction. Therefore, the demand for cement increases with increase in demand for construction. It has been observed that maximum cement consumption in the US usually takes place in October and May (PR Newswire par 4).

The cement industry in the US has recorded significant growth over the past. The industry recorded tremendous upward growth since the year 2006 (Economy Watch par 5). This trend has been maintained until recently where the industry continues to record an upward growth. ILK Cement intends to grow along with the industry.

To achieve this growth, ILK Cement intends to extend its market in the global market. This will include joint ventures as well as foreign acquisitions. Through the market acquisition, the company will be in a position to enjoy the benefits of the already developed brands. This will significantly contribute to the growth of the organization. Through the acquisition, ILK Cement will also be in a position to expand its market faster than while venturing into a new market independently.

The cement Industry requires a significant amount of initial investment. ILK Cement intends to use a total of about $450 million as its initial investment in the industry. This will cover all the expenses required in the installation of the necessary equipment. This amount of initial investment is high because the company will apply the recent technology will be relatively expensive.

As already noted, there are several players in the US cement industry. Some of the main competitors in the industry include Aggregate Industries US, Texas Industries, CEMEX Inc., Lafarge North America, and Ash Grove Cement Company. These companies contribute to a significant fraction of the total US cement production. They are involved in tough competition with each other, where each aims at acquiring the largest market share.

The costs of transport in the cement industry are usually very high. The transportation costs for cement are larger than its actual value (Clark 52). As a result, most of the companies in the industry tend to cluster in the lone region. This is to enable them to minimize their shipping costs to maximize profits. The target customers will be the construction companies as well as private entities. Therefore, the company will open several stores all over the market to facilitate distribution to customers.

Works Cited

Clark, John. “Concept of Too Strong Competition: The U.S. Cement Industry as a Possible Case Gerald Aranoff.” Eastern Economic Journal, Vol. 17, 1991. pp. 45-60.

Economy Watch. “Cement Industry.” Economy watch, 2011. Web.

PR Newswire. “US Cement Industry Analysis.” Pr news wire, 2011. Web.