Executive summary
The business, named Health Living Business will import and sell healthy living products. The manual wheatgrass juicer is the first product that will be imported and sold by the business. More products will be provided depending on the findings of the market research that will be conducted. The manual juicers are new products that are light and can be used for most leafy vegetables and grass. There is a demand for products such as that the shift from the mainstream centrifugal juicers that are not efficient and cannot be used for all fruit types. The financial resources needed for the business is £ 7000, of which 2000 will be loaned from friends. Local posters and local shows near supermarkets will be organised to show people the new products. Also, pamphlets will be printed and distributed in the supermarkets and other retailers where customers be issued with them.
Mission and vision
The aim of the business will be to teach the people about health issues and selling the them juicers that they can use to extract juice from leafy green vegetables and wheatgrass. The business will import the juicer from China and sell the locally to the people, especially the aged. As a family product that is manual, lightweight and easily portable, the product will be sold in to students as well as in supermarkets where the customers will be sent to access the products.
Through good marketing of the product, there a lot of chances that the business will sell in volumes and they will need outlets to sell the product. As such, the business fill the gap of sourcing products that are cheaply produced in the overseas and supplies them in the local stores where good demand is created through teaching means of marketing the product.
The business has a vision of increasing product portfolio by identifying products that are manufactured in China and selling at a profit as a retail store and as the main supplier in the region. The business will focus on consumable family products that are quality, cheap and long-lasting but most importantly, the products that meet the needs of the daily lives of people. There are several products that are targeted and which will meet the needs of people that will be sold together with the manual juicers in the retail stores such as portable automatic sewing machines, and other kitchen appliances.
Ownership
The business will run as a sole proprietorship. The owner will run the business, meaning that all the profits and losses will be borne personally. Besides, the decisions in running the business will also be the sole responsibility of the owner.
Market analysis
Market is the people for whom the business is producing the goods or services. This is one of the most important steps that a business will undertake. Identifying the right market is not easy and before starting a business, one would do research to evaluate the potential. The market would involve a geographic location, age, income and demographic interests, the size of the market of each of the age classes and needs for all these classes.
The Health Living Business will be located in the city of Sheffield, a metropolitan city that has a population of 550,000, according to the 2010 population basing on the 2001 census projections. According to the city council, the city is increasing in population mainly because of higher birth rates and low death rates. Besides, the city is an attractive ground for immigrants, because of the economic status of the city. This is one of the main reasons why The Health Living Business location will in Sheffield. The majority of the population is composed of age between 20 and 24 years. This is the population that is likely to be in school or just settling down and to form families. Research has shown that this is the population that does most of the shopping as opposed to the aged.
The City Council of Sheffield reports that the city has 17% of its population composed of Blacks and Minorities ethnic groups. Others include Chinese, Pakistani, Somali, Bangladeshi, among others. The overall population is projected to increase by 122 people per 1000 over the next 25 years, making it increase to 661,000 in the year 2033.
The economy of the city is also doing quite well. The number of working population is estimated at about 1.3 million, making it self-sufficient in labour source. However, the salaries of the people in the areas are about 10-15% lower, compared to the national average. The economy is about £ 9 billion a year, or about £16,300 per capita. This is a good indicator for the business, indicating people will have enough to spend on the goods of Health Living Business.
Given that the business will be manufacturing baked foods such as cakes and bread based cultures of different people, the business will have a ready market for the products. The business will produce the products that will be priced between 10 and 15% lower, according to the incomes of the people. Given that majority of the people is compose of young people, pricing lowly is one of the means of ensuring the products are affordable. Besides, the young people are likely to be in schools or looking for employment and as such may not have enough income for most of the products. Furthermore, as a new business, the low prices, coupled with quality products and services will use low prices as a strategy to gain entry into the market.
Competition
There are other manufacturers that produce the centrifugal juicers that are relatively cheap but do not do a decent job producing quality juice like the masticating manual juicer does. In addition, they are expensive, costing over £100 compared to £40 for the manual juicer. Although there are many other alternatives, theyare expensive and some people may not afford it for their domestic uses.
Business ownership and management
The business will be run and managed by the owner. There will be two employees that will be employed to do various errands. This includespicking theproducts from the port, delivering them to the various retailers and processing of all payments.
An assistant will also be needed to do the planning of display of the products in the rented tents nearby the stores and also distributing of the pamphlets detailing how the manual juicer will be used.
There are several other duties that the business will need but will rather outsource to save on resources that will be needed in the business. These include operations management and accountancy services.
Legal issues
The business will be registered in accordance to the laws governing small businesses in the UK. The certificate of registration and certification of quality will be needed to assure the customers the quality and safety of the products.
Marketing strategy
The products will be sold in the supermarkets and other outlets that stock home appliances. The business has assessed the position of the market in terms of availability and ability of the market to meet the demand of the products. According to Pinson &Pinnet (2006, pg. 208), the marketingplan comprises of all the advertising strategies, market analysis and how the business will make its sales of the product to the final customer.
In advertising, the business will use trade fairs where workers will show the product is used and the its applications in the home use. Such opportunities will be sought where the product will be shown to the public to create awareness. The juicers will also be marketed in local magazines that have targeted the families and especially nutrition for the children and the aged.
In the pamphlets and supermarket posters, there will be internet links that will send the customers to where they will access more information on how the products functions and reasons for juicing for healthy lives.
Business risks
Risks are expected in any businesses venture. Even established businesses are never safe from all the risks. Rather, the businesses use risks management techniques to identify them and use them to their advantage. New businesses as this suffers a lot of risks faces a lot of risks such as the following as outlined below:
- Financial risks: the business will need money to run at the beginning the of the period when it will not generate good income or returns. It is expected the business will raise its own income within three months before enough money is raised to be ploughed back into the business to meet the expenses.
- The products might be lost or be damaged on transit from China where they are expected. The products might also not be packed as ordered in the right quantities, which would affect the time of delivery as well as the meeting the anticipated demand.
- The risk of supposed retailers rejecting them on several grounds as not all people prefers manual juicers. This will imply the business will seek alternative options for selling the products.
- There is also a management risk. The few employees might fail toaccomplish their roles effectively and hence affect the effectiveness of the businesses meeting its objectives. They might also resign at the time when they are needed, which also cause might inconvenience of business achieving its objectives.
- The business also faces risk of loss of products from the store house, in the home where they will be stored. They might be lost or stolen from the house due to theft or fire.
- Risk of changing government polices with regard to certain products. The government might ban the products, raise taxes or alter policies that might affect availability or price of the products.
- Given the source country is far, there are risks of delays during the process of delivering them to the country. Shortages or alteration of policies in the manufacturing organisation might also affect the usual expected operation of the business.
Managing risk
The business is a desire that most people desire to own but few understand the price that is paid before one stands and pays off. With so many risk involved, it only make sense that they are managed appropriately and turned into opportunities. Indeed the definition of an entrepreneur is based on this definition where as a business owner, an idea fraught with risks of failing. According to Sadgrove (2005, pg. 13), at the beginning of the business, one is to identify and list all possible risks, develop a plan on how they can be handled. It means the owner has to have a risk appetite. The risk that is taken must have a greater reward. The risks for a business include marketing, health and safety, environmental, fire, computer risks and technical risks.
Approach to the specified risks
Healthy LivingBusiness will be insured against potential risks such as loss while in transit or in the warehouse. Monthly premiums will also be made against fire risks or theft while in the house to cushion the business against damage or potential losses.
To minimise management risks, the business will sign contract with the employees that will be working for the business. This way, they will be bound to commit to the business for at least three months or as the agreement stipulates. The agreement will also require that the employees that intend to leave the following month to tender their letters at least 30 days earlier so that the business has enough time to replace the employees.
Bulk orders will also be made so that the business has enough buffer stock in case has uneven demand for the products. After the business operates for more than a year, it will be easy for the business to forecast the demand and lead times for ordering the products.
A business person poised for success keeps focus despite the glaring risks. There are three ways to start a business and succeed. The choice will depend on resources and position of the owner such as resources. Sullivan (2000) noted that one can start from scratch, buy an existing one or list as a franchisee. The discussion and plan herein is for one person that has low capital resources and offers much flexibility compared to the rest.
Other determinants for success
The two ideas that Pinson and Jinnet (2006) offer with regard to business success is selection of a business idea whose chances of earning good profit margins are high. The two state that this is the main reason of getting into a business and as such, the money potential should be among the chief guideposts. The other reason is choice of a business that one loves. This will predict chance of commitment and willingness to innovate. Therefore, a business can be managed and be successful if the right mind-set is set and prior plan be in plan and be implemented. Thus, the need for research cannot be overemphasised before starting a small business. Personal qualities of business person should also be considered so that after doing a SWOT analysis, one knows exactly what their weaknesses are and how they can impact on chances of business success.
SWOT analysis
This is necessary to assess the position of the business in relation to the competitors in the market. The strengths and weaknesses are internal factors while the opportunities and threats are external factors that needed to be considered in making the decisions. While the internal factors can be controlled, the external factors cannot and the owner will need to comply with the situation.
References
Pinson, L & Jinnet, J (2006) Steps to Small Business Start-Up, Chicago: Kaplan Publishing
Sadgrove, K (2005) The Complete Guide To Business Risk Management, Aldershot: Gower Publishing,
Sheffield City Council, https://www.sheffield.gov.uk/libraries/archives-and-local-studies/publications/chinese-community.html (Accessed 7 December 2012)
Sheffield Economic Masterplanbr>
Sullivan, R (2000) The Small Business Start-Up Guide: Practical Advice on Selecting, Starting, Great Falls: International Information
