142. business start up plan

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Business start-up plan

Table of Content

1. Introduction .......................................................................................................................... 3

1.1 Rationale for Business Concept .................................................................................... 3

1.2 Aim and Purpose .......................................................................................................... 3

1.3 Product description ....................................................................................................... 3

1.4 Market Research ........................................................................................................... 4

2. Business Plan ..................................................................................................................... 14

1.5 Competitors and Competition ..................................................................................... 14

1.6 Business plan .............................................................................................................. 16

Market segmentation ........................................................................................................ 16

Supportive channel ........................................................................................................... 16

Customer Relationship ..................................................................................................... 17

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3. Financial consideration ...................................................................................................... 18

4. Critical Success / Failure Factors ....................................................................................... 23

5. References .......................................................................................................................... 25

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1. Introduction

1.1 Rationale for Business Concept

Are you interested in remembering your beloved toys when you were small? Have you held any sweet

recollections of long games in Risk or Monopoly? Are you interested in it and do you think it was

customarily cute in the children’s opinion? Are you sometimes excited to participate in whist you view

other bigger children doing horse all around? If you answer “yes” for all these queries, maybe, you love

children and the playing way. There are great opportunities that you may like to become a factor of

joining that time. Via the commencement of such a trading which is in relation to children, you could

accomplish that. It is a great time to start doing this now, as per this following research.

1.2 Aim and Purpose

The targets of this trading strategy are to establish outlet vending smart toys for children, which assists

trading actions of Educational Toy Planet. After opening, it will become the premise providing secured

goods which match the secured quality of toys for children in kindergartens and also children in the entire

city. Communal purpose of the strategy is the contribution of a minor part to the common growth of

kindergarten education and also the growth of kids complete, harmonizing and silky.

Below are the purposes of this trading strategy:

The creation of a lucrative firm.

The development of creative, educational toys.

The improvement of the studying curve for children by employing interactive toys.

1.3 Product description

Educational Toy Planet has grown three different practical and educational toys that do not act just as

joy to play with yet as well helpful in educating children essential skills. Even though they were in sample

type till this moment, the toys are pragmatically finished and are going to achieve their final form.

1.4 Market Research

Investigation regarding several elements which parents usually take into consideration whilst

purchasing toys: employing the survey

Age group from the sample:

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Children’s age

Frequency Percent Valid Percent

Cumulative

Percent

Valid

Under 18 months old 11 6.5 6.5 6.5

18 months – under 3 years old 26 15.3 15.5 22

3 – under 5 years old 53 31.2 31.5 53.6

5 – under 7 years old 30 17.6 17.9 71.4

7 – under 9 years old 24 14.1 14.3 85.7

9– under 11 years old 8 4.7 4.8 90.5

11 – under 13 years old 11 6.5 6.5 97

Above 13 years old 5 2.9 3 100

Total 168 98.8 100

Missing No answer 2 1.2

Total 170 100

Kids’ age is grouped from zero (less than eighteen months old) to thirteen years old. In the top

assessment table, the households which get kids from 3 to less than 5 years old comprise of the greatest

percentage (31.2 per cent), later the group of kids from 5 to less than 7 years old (17.6 per cent), the group

of kids aging 18 months old to less than 3 years old (15.3 per cent), the group of kids aging from 7 to less

than 9 years old (14.1 per cent). The remaining ones comprise of minor scale (less than 10 per cent).

Frequency of buying product

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Frequency of buying the product

Frequency Percent Valid Percent Cumulative

Percent

Valid

Below 1 week 13 7.6 7.6 7.6

1 – 3 weeks 40 23.5 23.5 31.2

1 – 3 months 63 37.1 37.1 68.2

4 – 6 months 27 15.9 15.9 84.1

7 – 11 months 14 8.2 8.2 92.4

10 – 12 months 6 3.5 3.5 95.9

Above 12 months 7 4.1 4.1 100

Total 170 100 100

As per this above chart, parents usually purchase toys for the kids varying from one to three months

old (37.1 per cent), which obviously shows the reflection of their need for this line of goods. Toy’s

characteristics do not seem similar to other essential goods (foodstuff, equipment, cosmetics, etc.) thus its

occurrence does not seem to be large. Yet, the occurrence of kid toys regarding the age from 1 to 3

months seems to be pretty large, demonstrating the attention of parents at this type of goods.

Products’ places

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Place to buy products Count Column N %

Supermarket Yes 104 61.20%

No 66 38.80%

Mall Yes 57 33.50%

No 113 66.50%

Market Yes 66 38.80%

No 104 61.20%

Retail store Yes 76 44.70%

No 94 55.30%

Park Yes 33 19.40%

No 137 80.60%

Others Yes 9 5.30%

No 161 94.70%

Yes – choose that place, No – not choose that place

Statistic chart following the removal of “No”

Supermarket 104

Mall 57

Market 66

Retail store 76

Park 33

Others 9

Table 1 sees the clarification of six premises which parents decide for their kids. It could be

understood that in the six premises, the supermarkets seem to be largely selected by parents to purchase

goods (104/170 coinciding viewpoints), after that happens to be the retail outlets (the outlets which is not

a part of the scheme of supermarket and bookstore) (76/170), the regional marketplaces which they are

residents (66/170), the final one happens to be the malls (57/170). This is completely suitable whilst toys

manufacturing section is not actually exceptional in devotion and marketing. Clients chiefly pay a visit to

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supermarkets, bookstores for shopping for their kids. Moreover, retail outlets are graded the second in the

directory of goals of parents as per the illustration from the data. It can could be supposed that except for

supermarkets, parents intend to pay a visit to outlets specialized in toys, thus they can be checked with to

select with more various types – the element which is not in good performance by the supermarkets in

HCM city.

Product Selection Criteria

The following table of data defines the data parents employ to choose toys for their kids.

Product Selection Criteria

Count Column N %

Designs Choose 112 65.90%

Not choose 58 34.10%

Price Choose 99 58.20%


Brand Choose 40 23.50%


Features and

utilities

Choose 119 70.00%


Origin Choose 39 22.90%


Interests of

children

Choose 104 61.20%


Therefore, the outcomes are explained, the team chooses four chief sections that are in the most

concern by parents: characteristics, advantages, designations, attention, and kid’s wishes and rates. The

two left data, brand names and origins formulate minor harmonizing votes (under 50 remarks), thus they

could not be categorized to be the most concerned principles. Yet, in the above principles, the goods’

characteristics happen to be the most critical principles.

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The most important criterion

Frequency Percent Valid

Percent

Cumulative

Percent

Valid

Designs 35 20.6 20.6 20.6

Price 24 14.1 14.1 34.7

Brand 5 2.9 2.9 37.6

Features 71 41.8 41.8 79.4

Origin 2 1.2 1.2 80.6

Interests and desires of

children 33 19.4 19.4 100

Total 170 100 100

The attention to product quality

Level of concern on the quality


Percent

Cumulative

Percent

Valid

1 = Total concern 69 40.6 40.6 40.6

2 = A bit concern 69 40.6 40.6 81.2

3 = No attitude 24 14.1 14.1 95.3

4 = A bit unconcern 2 1.2 1.2 96.5

5 = Total unconcern 6 3.5 3.5 100

Total 170 100 100

Upon the fore-mentioned order, in 170 poll, the large number of parents are pretty worried regarding

the standard of toys, demonstrating via degree 1 and degree 2 (40.6 per cent regarding each degree). It is

the concentration to standard in common the following analytical figures will show the more detailed

description regarding the factors of standard which parents concentrate on.

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Count Column N %

Durability Choose 61 35.90%


Long -time use Choose 50 29.40%


Safety Choose 124 72.90%


Proper design to the ages Choose 121 71.20%


Clear manual Choose 38 22.40%


As per the fore-mentioned analytical figures, it can be seen that the data for “Safety” is chosen by the

whole parents (124 votes), pursued by the data “Proper design to the ages” (121 votes). Additionally, the

data for “Durability” happens to be as well attracted yet does not explain much for of the vote (61 votes).

Data “long-time use” is positioned the fourth (50 votes) and data “clear manual” takes the ultimate

ranking (38 votes). Therefore, the kid’s parents start noticing that toy safety happens to be the most

critical. Since the features of this cargo happen to be usually in straightforward communication with kids,

thus request extremely great safety. Not staying at that, it should as well be designated to match various

age groups (121 votes in harmonization).

General awareness

Consciousness of the influence of toys on the development of kids: 87.6 per cent of participants

consensus that toys could influence brain growth, shaping character in kids.

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Customers’ awareness


Percent

Cumulative

Percent

Valid

Totally agree 77 45.3 45.3 45.3

A bit agree 72 42.4 42.4 87.6

Normal 16 9.4 9.4 97.1

A bit disagree 3 1.8 1.8 98.8

Totally disagree 2 1.2 1.2 100

Total 170 100 100

Consciousness of the hazardous influences of dangerous toys on ethical strength in kids: 86.5 per cent

propose that dangerous toys make a contrast influence on wellbeing, mind in kids, particularly kids in the

age from being born to 5 years old.

Customers ‘awareness


Percent

Cumulative

Percent

Valid

Totally agree 94 55.3 55.3 55.3

A bit agree 53 31.2 31.2 86.5

Normal 14 8.2 8.2 94.7



Total 170 100 100

Standard examination in toys – agreement or disagreement: 87.1 per cent of the parents shows the

agreement that kids’ toys are necessary to be examined of the standard prior to being placed for sale on

the marketplace.

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Customers’ awareness


Percent

Cumulative

Percent

Valid

Totally agree 104 61.2 61.2 61.2

A bit agree 44 25.9 25.9 87.1

Normal 16 9.4 9.4 96.5

A bir agree 4 2.4 2.4 98.8


Total 170 100 100

Future desire about Vietnamese toys

Clients that have employed Vietnamese toys: 113 out of 170 parents that have employed Vietnamese

toys, of that 46.9 per cent agrees to go on using Vietnamese toys in the upcoming time, just 21 remarks

(18.6 per cent) “wholly consent” in comparison with remarks (28.3 per cent) “a little agreement”.

Continue to use the products


Percent

Cumulative

Percent

Valid

Totally agree 21 12.4 18.6 18.6

A bit agree 32 18.8 28.3 46.9

Normal 50 29.4 44.2 91.2



Total 113 66.5 100

Missing System 57 33.5

Total 170 100

Clients that haven’t employed Vietnamese toys: 57 remaining parents have never employed

Vietnamese toys, of that 61.4 per cent are interested in using this goods in the upcoming time, yet, there

happens to be up to 19 remarks show reluctance (33.3 per cent).

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Desire to use the products


Percent

Cumulative

Percent

Valid

Totally desire 9 5.3 15.8 15.8

A bit desire 26 15.3 45.6 61.4

Hesitate 19 11.2 33.3 94.7

A bit not desire 2 1.2 3.5 98.2

Totally not desire 1 0.6 1.8 100

Total 57 33.5 100


Total 170 100

Contentment with Vietnamese toys: of 113 parents have employed Vietnamese toys, there happen to

be over 50 remarks displaying bewilderment regarding whether to please with this cargo or not (50.4 per

cent).

Satifaction level of customers about Vietnamese toys


Percent

Cumulative

Percent

Valid

Total satisfy 7 4.1 6.2 6.2

A bit satify 35 20.6 31 37.2

Hesitate 57 33.5 50.4 87.6

A bit disatisfy 9 5.3 8 95.6

Totally disatisfy 5 2.9 4.4 100

Total 113 66.5 100


Total 170 100

The causes for the discontent: 71 thoughts declare that Vietnamese toys do not own a lot of instances;

60 thoughts suppose that Vietnamese toys do not meet the likings of kids; 50 statements show that

Vietnamese toys have small standard. Additionally, 50 parents that have never employed Vietnamese toys

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wish that Vietnamese toys receive the improvement in designation, standard, security, educational

characteristic, confining likings of children greatly, and facts in the information on top of toys. Yet every

parent would show agreement to purchase Vietnamese toys should they feel satisfied of the whole above

wishes; 106 (61.4 per cent) of the parents are pleased to purchase Vietnamese toys.

Agree to buy Vietnamese products


Percent

Cumulative

Percent

Valid

Total agree 106 62.4 62.4 62.4

A bit agree 41 24.1 24.1 86.5

Hesitate 22 12.9 12.9 99.4

A bit disagree 1 0.6 0.6 100

Total 170 100 100

2. Business Plan

1.5 Competitors and Competition

For the analysis of publish division rivalry and productivity, the association has learnt five drives of

porter stemmed by Michael Porter in 1980. This supports the learning of industrial attraction.

Threat of New Entrants

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New rivals that have just put steps into the marketplace could confront a hazard. A booting association

owning discovery the later cargo might naturally bend the marketplaces prior to present associations

could respond. Therefore, toy associations should constantly investigate new cargoes and improve their

present cargoes and procedures correspondingly. In the toy division, the chief entry confrontation is the

faithfulness of clients. Firms for example “Playskool” and “LeapFrog” designate goods that could be

personally designated to the final user and upgraded by employing the internet. Such associations as well

provide their goods as per age group which allows clients to develop the cargoes provided by the

association. It is tough to split such behaviour of establishing in clients’ faithfulness.

Bargaining Power of Customers

The purchasers hold the entire strength in the toy division. They employ flexible fund to purchase toys –

the cargoes which do not happen to be fundamental needs. Toys could not be sold should there be any

shortage in the appeal of several sides of the goods, for example the factors of educating, initiative,

entertaining or several others. This field becomes so struggling, therefore rate must be maintained as per

the same goods or the goods should be unique in style that clients would not upset using up some more.

The impact on the field is that they should be careful of R&D and all the time be cautious with the raising

methods and tendencies and what their rivals are performing.

Bargaining Power of Suppliers

Providers in toy field do not have much bargaining strength; nonetheless, they happen to be every place

with small income, area surrounding management and expense for manufacturing; as well as huge rivalry

rate.

Threats of Substitutes

Whilst there happens to be the existence of the marketplace for toys, there is a rising tendency of toys that

are alternative of handmade electronic devices for example Ipods, Ipads and Kindles. Whilst the toy

division is against the fore-mentioned alike “toy” or “kid”, electronic goods will not be developed as

quickly as a kid version Ipod could be. The advantage of the toy division is that after the electronic goods

reach the marketplaces, there could be duplication without the financial pressure of R&D, marketing that

the host firm endured.

Competitive Rivalry within the Industry

Toy field owns the whole characteristics of monopolistic rivalry. Branding, faithfulness of clients as

well as appropriate marketing plans and rates in several circumstances result in distinguish. There

happens to be many producers and clients. Clients might realize there happens to be non-rate alternatives

in goods of rivals. Producers own a degree of managing over rate via manufacturing processes,

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technological development and cost-effective labour forces. Ultimately margin collapses even from the

decline in needs and the rise in the medium whole expense.

1.6 Business plan

Market segmentation

There are two various parts in the educational toys marketplace as follows:

Individual customers: In this part persons purchase a unique present for their children or

their friend. The division demographics happen to be households who own the revenue of

medium, own great desires for their children regarding educating and growth and hope for a

start as soon as possible. Speaking in general, they achieve at least an undergraduate degree,

41 per cent of the part obtaining a graduate degree.

Wholesale purchasers: This part comprises of the purchasers toys for children of their

clients. Such associations usually base on day care, or kindergartens. The number of kids

looked after by them usually positions from 7 to 25.

Supportive channel

Educational Toy Planet has decided to vend directly to the clients; employing conventionally multiple-

layer allocation scheme employing wholesalers to transact with retailers is no longer in utilization. This

does not only generate more work for the firm in relation to sales volume expansion, yet as well provides

greater earnings. Additionally, this process will be less costly for the initial some years, nonetheless,

provided that they establish the connection with personal clients and wholesalers, this expense would

greatly decline since the first clients are employed to the firm’s perfect line of goods and perform buying.

Customer Relationship

Educational Toy Planet will focus on personal clients and wholesalers owing to some finer causes:

Better margins. Even though sales volume would become lessened in relation with the

utilization of wholesale distributors, there would be greater earnings.

Closer contact with customers. A tighter connection would be set up owing to the method

they vend directly to the clients. This is advantageous as it provides more accurate reply

groups which are useful in the development of goods.

More efficient. Less layers in relation with the distribution of procedure.

Marketing strategy

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The marketing tactics would emphasize the fact that Educational Toy Planet’s cargoes are in fact

educational and cute instruments, which conveys an outstanding text as parents might hope their children

to be playing with such type of toy. The element of “toy” in the good is optimized with the target of

holding the children occupied in the goods, something usually tough to perform with chiefly educational

instruments. The marketing tactics would show the identification of the fact regarding two various loops

of client which should be urged. To restrict the receptiveness of both loops, Educational Toy Planet

recognizes that they seem to be pretty different despite the fact that they are buying the same goods.

Educational Toy Planet would optimize advertising and straight mailing. The advertising would get a

situation in publication or papers chosen specifically realizing the aimed clients. Papers would be

optimized for the personal marketplace and a link of papers and journals would be optimized for the

trading divisions.

Sales Strategy

The sales tactics would be designated for per client loop. The tactic in sales for persons in the creation

of adequate awareness of Educational Toy Planet thus customers would request their retailers to pick

Educational Toy Planet. To resolve the trading segment, Educational Toy Planet’s purpose is that the

trade does not only purchase some goods yet as well the whole of them appointing various expertises, the

whole of them are essential. This is extremely essential since trading usually follows clients, which is to

say that if the clients are contented with the goods it is likely that they will happen to become regular

clients and won’t find for new vendors.

3. Financial consideration

The business will be set up and everything will be ready in the first three months. During this

period, there is no sale expected. The next three years sales forcasted for financial estimation as

shown in the following:

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Sales Forecast

Year 1 Year 2 Year 3

Sale

Individual £43,550 £128,570 £166,360

Business £37,890 £111,850 £144,730

Total Sale £81,440 £240,420 £311,090

Direct Costs of Sale Year 1 Year 2 Year 3

Individual £17,420 £51,430 £66,550

Business £15,160 £44,740 £57,900

Subtotal Direct Costs of Sale £32,580 £96,170 £124,440

The funds required for this business plan is shown in the following:

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Start-up Requirements

Start-up Expense

Legal £2,620

Stationery etc. £130

Brochure £130

Consultant £1,960

Insurances £260

Rents £390

R&D £3,270

Total Start-up Expense £8,760

Start-up Assets

Cash Requirement £76,270

Other Current Asset £0

Long-term Asset £6,540

Total Asset £82,810

Total Requirement £91,570

These investments are break down as following:

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Start-up Funding

Start-up Expense Funding £8,760

Start-up Asset Funding £82,810

Total Fund Requirement £91,570

Asset £0

Non-cash Asset from Start-up £6,540

Cash Requirement from Start-up £76,270

Additional Cash Raising £0

Cash Balance on Starting Date £76,270

Total Asset £82,810

Liability and Capital

Liability

Current Borrowings £0

Long-term Liability £0

Account Payable £0

Other Current Liability £0

Total Liability £0

Capital £0

Plan Investment £0

Owner £26,160

Other Investors £65,410

Additional Investment Requirements £0

Total Plan Investments £91,570

Loss at Start-up -£8,760

The profits and losses generated are shown as following:

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General Assumption


Project stage 1 2 3

Current Interest Rate (%) 10 10 10

Long-term Interest Rate (%) 10 10 10

Tax Rate (%) 30 30 30

Project Profits and Losses


Sale £81,440 £240,410 £311,080

Direct Costs of Sale £32,570 £96,160 £124,430

Other Costs of Good £0 £0 £0

Total Costs of Sale £32,570 £96,160 £124,430

Gross Margin £48,860 £144,250 £186,650

Gross Margin % £0 £0 £0

Expense £0 £0 £0

Payrolls £64,100 £83,720 £102,040

Sale and Marketing and Other Expens £2,750 £2,750 £2,750

Depreciations £1,300 £1,300 £1,300

Rents £4,710 £4,710 £4,710

Utility £2,350 £2,350 £2,350

Insurances £1,960 £1,960 £1,960

Payroll Tax £9,620 £12,560 £15,310

Others £780 £780 £780

Total Operating Expense £87,580 £110,140 £131,200

Profit Before Interest and Tax -£38,710 £34,110 £55,450

EBITDA -£37,410 £35,410 £56,750

Interest Expenses £0 £0 £0

Incurred Taxes £0 £10,230 £16,630

Net Profits -£38,710 £23,870 £38,810

Net Profit/Sale £0 £0 £0

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4. Critical Success / Failure Factors

Quality control: Stuffs which are certified to be toys basing on the provision of time, yet,

stuffs designed to be able to play with children might be seen to be toys. Small wooden stuffs

as well as complex games played on computer might be taken into consideration as goods of

toy field. Video games and stuffs which are more enhanced might not receive the

classification to be cargoes of toy field, particularly if their aims turn out to be teenagers or

adult persons.

Design: The designations of toy are probable to be complex and comparative to remarkable

investigation and checking. Manufacturing such stuffs happen to be frequently more complex

since it is compulsory for the watching of various safety and substantial regards to be done. A

segment of the toy field happens to be sales, which comprises doing advertisement and

investigation in what creates a rational rate. Holding a person’s liking in toys via physical

stores and online happen to be not usually severe, as children are going to become enthusiastic

clients, yet, marketing is assumed to draw contraction of children as well as parents. The toy

field does not just stay at the meaning of a stuff of manufacturing toys and giving them in

sales, it becomes the entire complex processes. Except for trading industry, there happens to

be other features of the toy field. In this section, there happens to be papers offing data of

current cases and potential goods. Attendance at conference with the aim at sharing

information and illustrating goods to potential clients is general in toy producers. From time to

time, in definite cases, there happens to be the prizes for the best toy.

Whilst methods become more and more common, apparently, the toy field will be oriented to

more and more complex goods. Simple cargoes are probable to keep their admiration in the

niche marketplace and therefore still take up a place in the field. Soft toys, blocks and other

historical toys hold on being presented and seen as a fragment of the toy field even in the type

of complexly electronic toys. The method accessibility at more cost-effective obtainability at

cost-effective rate shows up more and more, which is to say that the toy field will see to hold

varying harshly in the upcoming time.

Legal issue: The security of the children playing with educational toys is taken into

consideration to be the most critical in the toy field. Even though laws create fundamental

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obstacles, for example raised test and administrative especially for SMEs, the field attempts a

lot of ensuring that there is security in every single fact and remarkable workstuff of

progressing goods. So as to make sure of secured toys, a lot of work is employed in the

design, development, test, production and delivery of toy.

This document is provided by:

VU Thuy Dung (Ms.)

Manager

Center for Online Writing Resources

Facebook : https://www.facebook.com/vu.thuydung.5076

Email : [email protected]

Blogger : http://assignmentsource.blogspot.com/

Website : http://assignmentsource.com/

https://www.facebook.com/vu.thuydung.5076

mailto:[email protected]

http://assignmentsource.blogspot.com/

http://assignmentsource.com/

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References

Williams, K. (2010). Brilliant Business Plan: What to know and do to make the perfect plan.

Prentice Hall.

Ford, B. R., Bornstein, J. M., & Pruitt, P. T. (2010). The ernst & young business plan guide.

Wiley. com.

Swick, K. (2010). Designing a Model of an Online Business and Writing a Business Plan.

142. business start up plan

Education

Transcript of 142. business start up plan