Young of Resols Advertising - Business Plan Example

Resols Advertising Agency Business Plan for UAE Outline 0 Executive Summary 3 2.0 Company Summary 3 2.1 Keys to Success 4 2.2 Start up Summary 5 3.0 Services 6 4.0 Market Analysis Summary 7 5.0 Strategy and Implementation Summary 7 5.1 Sales Forecasts 8 5.2 Milestones 8 6.0 Management Summary 9 7.0 Financial Plan 9 7.1 Start up Funding 9 7.2 Projected Profit and Loss Statement 9 References 11 1.0 Executive Summary Resols advertising is an advertising agency firm that seeks to operate in Dubai, United Arab Emirates. Resols advertising seeks to offer advertising services to Dubai companies that are planning to use email marketing techniques as their major marketing strategy. It has been suggested by analysts that email marketing will soon become one of the most cost effective methods available to companies to reach their customers all over the world. Resols will be responsible for designing, building, testing and launching the email marketing campaigns for these companies. The firm will also be reporting the progress of the email campaign in order to ensure that customers are offered maximum flexibility. Finally, Resols will be responsible for evaluating the success of the campaigns in order to ensure there is improvement. The business plan will provide the projected financial data for a period of five years including the year of start up. The figures provided are in USD. 2.0 Company Summary Resols Advertising is an advertising agency firm that has five founders. The five founders of are former employees of major marketing companies on both the international scope and in the UAE and all of them held top positions in the marketing departments. These founders have been have been working in Multi National companies for several decades and they are therefore bringing this experience to Resols Advertising. The firm seeks to offer email marketing services to various firms in the Dubai market and will be responsible for designing, building, testing and launching the email marketing campaigns for these companies (UAE Ministry of Economy, 2012). The firm will also be reporting the progress of the email campaign in order to ensure that customers are offered maximum flexibility. Finally, Resols will be responsible for evaluating the success of the campaigns in order to ensure there is improvement. The company therefore aims to build a reputable and profitable advertising agency business in Dubai, the United Arab Emirates (Schiliro, 2013). Resols advertising seeks to target corporate customers as well as individual entrepreneurs who have businesses operating in the UAE. The advertising agency will seek to transform their marketing strategies where they will help them to develop and deploy marketing campaigns which are considered much cheaper than other forms of advertising. The company will also offer these services to public sector entities which seek to improve their brand identity in the market and which are seeking to compete with their counterparts in the private sector (Yousef, 2004). Most of the clients of the advertising agency will be the Small and Medium Sized companies operating in Dubai as well as the large Multi National Corporations, large public sector entities and individual entrepreneurs who have established business operations in Dubai, the UAE (Helpman, 2004). Presently, looking at the market footing in Dubai there is clear indication that the local firms pose a stiffer competition to the international firms in the business stratum. Therefore it is important for these firms to market themselves in a more effective way such that they are able to gain the much sought after market share and also stand a better chance in the competitive market. Following a market analysis study carried out for the past three years, Resols Advertising Agency has come to conclusion that its potential clients will be inclusive of both new and existing businesses which with the aim of remaining competitive seek to transform their businesses (Barclays 2014). 2.1 Keys to Success The keys to success for Resols advertising agency are divided into internal factors and external factors just like for any other business and these are therefore discussed separately in the following section. It is therefore important to note that these two are the main keys to success that the management of Resols advertising agency will use to establish their business and grow it to a profitable one in Dubai, the UAE (Barclays, 2014). External Factors: External factors are factors that influence the operations of a business as a result of the external environment that the business operates in such as business climate, government regulations and the economic conditions in the country. The business climate in Asia and specifically in Dubai is today characterised by a lot of competition as a result of the rapid growth that has been experienced over the past few decades. This growth has been as a result of innovations and increased investments in various businesses, infrastructure, technology and global business in general (Breen and Blankenship, 1982). Internal factors: Internal factors are the firm specific factors that help the firm to attain competitive advantage. The management of Resols advertising agency plans to use these internal factors in an effective manner to build a sustainable business in Dubai. The first factor is that since the firm specialises in helping other firms carry out their advertising campaigns, the company will be able to use the skills of the founders to market themselves and thus gain a significant market share in an easy manner. Second, the fact that the company seeks to help firms establish email marketing campaigns which are considered cheaper than other methods means that they have a cost efficient service which will give them a competitive position in the market. The advertising agency also intends to tailor each email marketing campaign to suit the needs of the individual customers thus ensuring that they are successful (Bobrow, 1987). 2.2 Start up Summary The following table present the start up expenses for Resols advertising agency Requirements Start-up Expenses Rent for Office Space $1500 Registration of the Agency $500 Office Stationery $600 License for the business $5000 Total Start-up Expenses $7600 Start-up Assets Cash Assets $120,000 Other Current Assets $20,000 Long-term Assets $75,000 Total Assets $215,000 Total Requirements $222,600 3.0 Services The services that Resols advertising agency seeks to offer will encompass all the aspects of email marketing strategy. This will therefore involve all the aspects from the design to the post implementation evaluation of the project. The various services that the agency seeks to offer to their customers include: designing the email campaigns, personalising the campaign and targeting the right customers, managing the email list, designing the deployment system, testing the email campaign during planning stage, implementing the email campaign, monitoring and evaluation of the campaign in real time, carrying out the Return on Investments (ROI) analysis and carrying out the post implementation analysis. The agency plans to offer these services in Dubai, The United Arab Emirates. The agency will seek to establish itself as an agency that offers high quality services in email advertising as a way of building their brand and gaining competitive advantage (Siegel, Ford and Bornstein, 1993). 4.0 Market Analysis Summary It has been argued that online promotions are normally very effective for both offline companies as well as for online companies. Although most offline companies offer marketing promotions that encourage their customers to visit their physical stores, most customers in today’s technologically advanced world are more comfortable and responsive to online campaigns. This is therefore a huge market opening for the companies to target those customers who have access to personal computers and other internet enabled devices. The advertising agency therefore seeks to target two major customer segments and these are the online companies that engage in e-commerce and the offline companies (Pinson, 2004). Market Summary year 1 year 2 year 3 year 4 year 5 Potential customers Growth CAGR % Online Companies 25% 620,000 775000 968750 1210938 1513672 25% Offline Companies 2% 1,500,000 1530000 1560600 1591812 1623648 2% Others 0% 0 0 0 0 0 0% Total 10.50% 2,120,000 2,305,000 2,529,350 2,802,750 3,137,320 10.50% 5.0 Strategy and Implementation Summary Resols Advertising Agency will adopt a strategy where the management of the company intends to make use of the extensive network that the founders of the agency have harnessed over the years during their employment in major marketing companies in UAE and on the international scope. Further the experience and expertise of the founders who will be the lead consultants can be utilised to the maximum. These expertise levels of the founders will be used to build an email marketing campaign that will be directed at the select customers that the company targets (Pinson, 2004). 5.1 Sales Forecasts With the over two million customers that the agency targets, the strategy is to focus on a selected group of about 50,000 business entities each quarter of the year in order to offer better tailored services to them. The management estimates that they will gain a 5 per cent response rate from these targeted customers per every quarter and these will therefore generate 1,250 business leads for the company. The company plans to further use these leads to generate business contacts who can be turned into one time and return customers for the agency. In the first year, the company will therefore have generated 5,000 business leads which can be converted to customers (Dubai Economic Council, 2011). Sales Forecast Year 1 Year 2 Year 3 year 4 year 5 Sales Online Companies $180,000 $270,000 $360,000 $420,000 $510,000 Offline Companies $50,000 $100,000 $150,000 $250,000 $300,000 Total Sales $230,000 $370,000 $510,000 $670,000 $810,000 Direct Cost of Sales Year 1 Year 2 Year 3 Year 4 Year 5 Online Companies $0 $0 $0 $0 $0 Offline Companies $0 $0 $0 $0 $0 Subtotal Direct Cost of Sales $0 $0 $0 $0 $0 5.2 Milestones Milestone Start Date End Date Budget Manager Department Business Plan 15/04/2014 11/05/2014 $4,500 Manager 1 CEO Stationery 15/05/2014 18/05/2014 $2,000 Manager2. Procurement Brochures 11/05/2014 12/06/2014 $4,000 Manager 3. Procurement Office Equipment 12/05/2014 12/06/2014 $3,000 Manager 3. Procurement. Advertising -- Print 15/06/2014 20/07/2014 $3,000 Manager 4 Marketing Advertising -- Internet 10/06/2001 12/09/2014 $2,000 Manager 5 Marketing  6.0 Management Summary The management of the advertising agency will comprise of the initial founders of the company and they will each head a particular department. There will be three more independent consultants who will be engaged for particular projects and therefore will be on need basis. For the agency to be able to run efficiently, the agency will need to procure the services of various employees to offer different services. It is projected that these employees will be engaged on long term basis (Pinson, 2004). 7.0 Financial Plan 7.1 Start up Funding The start up funding for Resol advertising agency will come from the personal savings of the five initial founders Start up Expenses to fund $7600 Start up Assets to fund $215,000 Total $222,600 Capital Owner Savings 222,600 7.2 Projected Profit and Loss Statement Year 1 Year 2 Year 3 Year 4 Year 5 Sales 180,000 270,000 360,000 420,000 510,000 Direct cost of sales 0 0 0 0 0 Indirect cost of sales 0 0 0 0 0 Gross Margin 180,000 270,000 360,000 420,000 510,000 Gross Margin % 100% 100% 100% 100% 100% Expenses Office Rent 2,500 2,800 3,000 3,200 3,500 Licenses 500 500 500 500 500 Office Expenses 2,800 3,200 3,500 3,900 4,500 Consultancy fees 20,000 25,000 30,000 35,000 40,000 Total expenses 25,800 31,500 37,000 42,600 48,500 Profit before Tax 154,200 238,500 323,000 377,400 461,500 Tax 46260 71550 96900 113220 138450 Net Profit 107,940 166,950 226,100 264,180 323,050 Net Profit % 59.96 61.8 62.8 62.9 63.34 References Barclays (2014) Writing a Small Business Plan, Retrieved on 28 March 2013 from http://www.barclays.co.uk/Startupsupport/Writingasmallbusinessplan/P1242559649359 Bobrow, E.E. (1987) Pioneering New Products: A Market Survival Guide. Dow Jones-Irwin, Homewood, IL. Breen, G, and Blankenship, A. B. (1982) Do-It-Yourself Marketing Research. McGraw-Hill, New York. Dubai Economic Council. (2011). Business Environment, Enterprise Performance and Economic Development in Dubai. A Policy Report, Dubai. Helpman, E. (2004). The Mystery of Economic Growth, The Belknap Press of Harvard University Press, Cambridge (MA). Pinson, L. (2004). Anatomy of a Business Plan: A Step-by-Step Guide to Building a Business and Securing Your Company’s Future (6th Edition). Dearborn Trade, Chicago, USA. Schiliro, D. (2013), Diversication and development of the UAEs economy, MPRA Paper No. 47089. Siegel, E.S., Ford, B.R and Bornstein, J.M (1993), The Ernst & Young Business Plan Guide John Wiley and Sons, New York. UAE Ministry of Economy. (2012). Annual Economic Report 2012, Abu Dhabi, United Arab Emirates. Yousef, T.M. (2004). Development, Growth and Policy Reform in the Middle East and North Africa since 1950, Journal of Economic Perspectives, vol.18, no.3, pp. 91–116. Read More