Syndicate Consulting Business Plan Analysis - Case Study Example

Table of Contents Executive Summary 3 Objective 4 Mission 4 Key to Success 5 Company Summary 5 Startup Summary 5 Company Location and Facilities 6 Company Ownership 6 Services 7 Service Description 7 Competitive Comparison 7 Sales Literature 8 Fulfillment 9 Technology 9 Market Analysis Summary 9 Market Segmentation 10 Strategy and Implementation Summary 10 Pricing Strategy 11 Sales Strategy 11 Strategic Alliances 12 Management Summary 12 Organizational Structure 12 Management Team 13 Personnel Plan 13 Financial Plan 14 General Assumption 14 Projected Cash Flow 14 Projected Profit & Loss and the Gross Margin 15 Syndicate Consulting Business Plan Executive Summary Syndicate Company will be a consultation firm that will specialize in selling and marketing technology products. The company operation will be on international arena. The company will provide first class manufacturers with high quality and reliable alternative to resources that are in-house for market development, channel development, and market development. Syndicate Consulting Company will be developed as a New York corporation that will be located in Clara County. The company will be owned by the principal operators and principal investors. Within the United Stated and European Companies, some of the firms that the company will target will be focused on the large corporations such as Microsoft, IBM, and HP. Syndicate Secondary target will be medium sized firms in high growing regions like software and multimedia. One of the challenges that the company will face, is stabling with the consulting companies found in real estate market. The industry competition will result from various forms, the most crucial one will be the company that operates in market research and business development. Other large consulting companies such as Boston Consulting and Arthur Anderson will be our biggest threat. The competitors are generalist and do not have a specific niche market. Additionally, they are hampered by unstable organizational structure that fails in providing the most qualified and experienced personnel for the projects of their clients. Another competitor that the company will face is various research firms like Stanford Research Institute and Dataquest (Bangs & Hendrick, 36). Syndicate advantage compared to the competitors is that the company will provide higher consulting services to assist the integration of the market data with the goals of the company. The founders of the market will be former consulting services marketers, market research, and personal computers. The company will be managed by the operating partners in structure taken from the Smith Partners. At the beginning of the company’s operation, the company will assume 3 to 5 partners. It is estimated that the company will realize a profit of 65000 dollars by the 3rd year and a net profit margin of 6 per cent. The company will take 130000 dollar as the current debt and collect the 500000 dollars from long-term debt. The company is not planning any financial problem. Objective 1. Make sales of 550000 dollars during the first year and 1 million dollars by the third year 2. Realize a Gross Margin of higher than 70 per cent 3. Realize a Net Income of more than 5 percent of cash inflow by third year Mission Syndicate Consulting Company will provide high standard manufacturers with a high quality and reliable alternative to resources of in-house for channel development, market development, and business development on a global scale. The correct alternative to the resources will provide a practical experience, contacts, confidentiality, and expertise. Customers and clients need to know that operating with Syndicate Consulting Company will be more professional and less risky ways of developing new region that operating in in-house with their specific individuals. The company will also maintain its financial balance, by charging standardized value for their services and deliver even much high higher value for their clients. Initially, the company will focus on the development of the Latin American Markets, European markets, and European customers that are found in US. Key to Success 1. The company will be very keen in fulfilling the company’s promise. This will be achieved through complete confidentiality, trustworthy expertise, and reliable information 2. The company will also focus on developing the flexibility in generating new leads of the business 3. The company will also leverage from one collection of expertise into various revenue generation opportunities. This expertise includes the retainer consulting, market research, project consulting, and published reports of market research. Company Summary Syndicate Company is a startup company that will provide a high-level experience in business development, distribution strategies, marketing technological products, and channel development. It will concentrate mainly in offering two types international framework. 1. Offering client of US with development experiment for the Latin and European markets 2. Offering the European customers with development for the Latin and US American markets As the company grows, it will take on consulting services in the related markets like the rest of the Far East, Latin America, and similar markets. The company will also look for some more leverage by issuing the brokerage and representation position to develop the percentage holding in the results of the products. Startup Summary The total start up expenditure include the logo design, the stationery, and their related expenditure, this will add up to 18350 dollars. The startup assets will include the 7000 dollars for short-term assets and 25000 as initial costs to handle the consulting operations as the accounts receivable and sales play through the cash flows. The details are as shown below Start-up Funding Startup Expenses to Fund 0 Startup Assets to Fund 0 Total Funding Required 0 Assets Noncash Assets from Startup 0 Cash needed from Start up 0 Additional Cash Raised 50000 Cash Balance on the starting Date 50000 Total Assets 100000 Liabilities and Capital Liabilities   Current Borrowing 0 Long Term Liabilities 0 Account Payable 350 Total Liabilities 350 Capital   Investor 1 20000 Investor 2 20000 Other 10000 Total Capital 50000 Total Capital and Liability 50000 Company Location and Facilities The original office will be located in a quality office location in Clara, California, in the middle of United States high Technology industry. Company Ownership Syndicate Company will be developed as a corporation that will be based in Clara County. The principal operators and the principal investors will own the company. The company is yet to determine the legal information alternatives. Services Syndicate Company will provide the expertise for a high technology company that will develop new market segment and new market distribution in the new markets. This will be taken as one of the high standard retainer-consulting, project based consulting, and market research reports Service Description 1. Retainer consulting; Syndicate Consulting Company will represent the client firm as an extension for the market development function and business development. This starts with the complete comprehension of the situation of the client company, its objective, and its constraints. The company will also represent the client firm quietly and with confidence, sifting through the market development and new chances appropriate to the customers, representing the customer in initial discussion with possible channels, allies, and vendors. 2. Project consulting, the billed, and proposed on each project and milestone basis. The project consulting will provide the client company will ways of harnessing the specific qualities and using people’s expertise in solving their specific problems, implement and develop plans, and come up with specific information. 3. In the market research, the group research available for selected customers at a price of 5000 dollars per unit. The group research will be published and packaged for specific channel, topic, and market. Some of the illustrations might be researches of coming up with channels in Mexico and Japan, or implication of the software changing margins. Competitive Comparison The competition will arise in various forms 1. The most important competition is zero consulting, firms choosing to carry out channel development, market research, and business development in-house. Their supervisors and managers do this independently as one of their regular business criteria. The key advantage of the company in completion for the business development is that the managers are overwhelmed with roles thereby they lack time for other additional roles. 2. The management consulting companies such as Arthur Anderson, Bain, and McKinsey will be the main competitors. The companies are generalists who carry along their brand name to certain regions. They have the weaknesses in their management structure that has partners for selling inexperienced associates and new jobs. The company will compete with the named companies in their specific fields. 3. The third competitor will be the International Market Research, Dataquest, and the Stanford Research Institute. The companies are rated as formidable competitors for published market forums and market research, but cannot offer consulting services that Syndicate Company can offer. 4. The fourth competitor for Syndicate Consulting Firm is the market specific small house. For instance the Nomura Research found in Japan, and the C.V found in Mexico Sales Literature The company will start with a general corporate brochure that will establish the positioning. The brochure will be created as one of the startup expenses. The mailings and literature for the market forums will be critical. Fulfillment The main delivery and fulfillment will be offered by the business principals. The main core value will be professional expertise offered through the combination of education, hard work, and experience. The company will also turn to freelance market research and report development, which are regions that people can sub-contract without risking the main valued to the customer. Technology 1. Syndicate Consulting Company will maintain the Macintosh Capabilities and Windows that will include the 2. Complete email facilities on the Apple link, CompuServe, and America-Online for operating with customers through the delivery of information. Market Analysis Summary The company will focus on high technology manufacturers of computer services, networking, hardware, and software, who would like to sell into US, Europe, and Latin America markets. These normally comprises of the larger companies and medium sized firms. The most crucial potential customers for the company will the executives that manage big companies. This includes the marketing managers, sales managers, and general managers charged with the international focus and sometimes charged with specific focus of channels. They are time conscious or risk their money for questionable expertise. As they approach the market, for opportunities, they are always sensitive to risk the name and reputation of the company. Market Segmentation The most crucial market segment includes the IBM, Hewlett Packard, Siemens, Microsoft, and Olivetti. The companies will call Syndicate Consulting Company for development functions that will be well managed in-house, for market forums, and market research. The comprehensive market analysis is shown below Market Analysis Year 1 Year 2 Year 3 Year 4 Year 5 Potential Customers Growth CAGR U.S. High Tech 10% 5,000 5,500 6,050 6,655 7,331 10.00% European High Tech 15% 1,000 1,150 1,333 1,531 1,749 15.00% Latin America 35% 350 338 456 616 833 35.07% Other 3% 10,000 10,300 10,404 10,613 10,834 3.00% Total6. 37% 16,350 17,188 18,333 19,404 30,736 6.37% Strategy and Implementation Summary The company will focus on three markets like Europe, Latin America, and United States. It will also focus on limited product segments such as telecommunications, personal organizers, personal computers, and integration products of technology. The target client will be managers in larger companies, and occasionally owners and presidents of the medium sized corporation in periods of high growth. Pricing Strategy The company will prices on the upper edge of what the industry will bear, competing with brand consultants. The pricing will fit with the general positioning of the Syndicate Company as offering expertise of high level. The consultation services will be based on 5000 dollars daily for project consulting, 2000 dollars daily for market research, and 10000 dollars monthly for retained consulting. The reports for the market research will 5000 dollars per report, which will need that the report be well focused, planned and later presented. Sales Strategy The annual sales project for the company is shown in the table below Sales Forecast Year 1 Year 2 Year 3 Sales Retainer Consulting $300,000 $350,000 $535,000 Project Consulting $370,000 $335,000 $350,000 Market Research $133,000 $150,000 $300,000 Strategic Reports $0 $50,000 $135,000 Total Sales $803,000 $875,000 $1,100,000 Direct Cost of Sales Year 1 Year 3 Year 3 Retainer Consulting $30,000 $38,000 $58,000 Project Consulting $55,000 $56,000 $70,000 Market Research $85,000 $105,000 $131,000 Strategic Reports $0 $30,000 $50,000 Subtotal Direct Cost of Sales $159,000 $219,000 $289,000 Strategic Alliances The company will more likely form alliances with Jones and Smith. After getting the prospective partners background, the company will consider talking to the European companies such as Olivetti and Apple Computer. In Latin America, the company will look at high technology vendors such as Printaform. Management Summary The initial management will depend on the founders of the company with little or no back up services. As the company grows, Syndicate Consulting Company will take additional consulting services, editorial, marketing, and sales help. Organizational Structure The working partners, in structure conducted from the Smith partners, will manage the company. At the beginning of the company’s operation, syndicate will assume three to five partners. 1. Dennis Mark 2. Two partners from Jones and Smith 3. Strong European Partner stationed in Paris 4. The company will require being very flat with each founder member being responsible for their management and work. 5. Another Strong Partner Management Team The company will need a high international expertise and experience meaning that the company will be easily leverage in the normal consulting mode where the partners will run the business and make their own sales. The partners will be involved in fulfilling the proposition of the business. They will also provide expertise to the customer. The previous plan of the personnel will still be tentative. It needs to incorporate three to five partners, three consultants, good staff support, and an office manager. Later the company will add more consultants, and sales staff. Personnel Plan The annual personnel plan estimates is as shown in the table below Year 1 Year 2 Year3 Partners $155,000 $175,000 $200,000 Consultants $0 $50,000 $63,000 Editorial/graphic $18,000 $22,000 $26,000 VP Marketing $20,000 $50,000 $55,000 Sales people $0 $30,000 $33,000 Office Manager $7,500 $30,000 $33,000 Secretarial $5,250 $20,000 $22,000 Total People 7 15 20 Total Payroll $195,750 $377,000 $532,000 Financial Plan The financial plan is based on the assumptions and conservative estimate. The company will need to plan their initial investment in making the financials work. General Assumption Assumption Year 1 (%) Year 2 (%) Year 3 (%) Market rate of interest 15 16 12 Long-term rates 12 12 12 Tax rate 30 30 30 Projected Cash Flow It is expected that the revenue of the company to be more than the expenditure over the three years Pro-Forma CF (£) Year 1 Year 2 Year 3 Cash-Inflows from operations 300,000 450,000 580,000 Additional Inflows 10,000 8,000 12,000 TOTAL CIF 310,000 458,000 592,000 Expenditures Operational Exp. 35,000 40,000 54,000 Cash Exp. 5,000 10,000 6,000 Bills 100,000 120,000 200,000 Fixed Asset Repayment 15,000 15,000 15,000 Sales tax, HST, VAT 0 0 0 TOTAL COF 155,000 185,000 275,000 NET C/F 155,000 273,000 317,000 Projected Profit & Loss and the Gross Margin The table shows the profitability and grand annual for Syndicate company over a period of 3 years Year 1 2 3 Gross Annual Margin (£) 120,000 140,000 145,000 Profitability Index Year 1 Year 2 Year 3 £7, 000 £21, 000 £28, 000 Projected Balance Sheet The net worth of the company is expected to be good. Item Year 1 Year 2 Year 3 Current assets (cash) 9,000 27,000 50,000 Long-term assets 59,000 59,000 59,000 Acc. Depreciation 8,000 16,000 24,000 TOTAL ASSETS 76,000 102,000 133,000 Current Liab. payables 9,000 10,000 12,000 Long-term Liab. 40,000 32,000 25,000 TOTAL LIAB. 49,000 42,000 37,000 NET WORTH 27,000 60,000 96,000 Reference Bangs, D. H., & Henricks,. Business plans made easy. [Irvine, Calif.], Entrepreneur Press.2005. Print Read More