Lovetorprint Reloaded - business plan critically analyzed
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Transcript of Lovetorprint Reloaded - business plan critically analyzed
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Love2Print Reloaded
Author: Caecilie Olive Hechtel
Tutor: Prof. Raffaello Balocco
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Review and improve (reload) the LovetoPrint businessplan by applying the newly acquired competences.
Prove that the LovetoPrint Reloaded would have led to asuccessful business venture.
Objective of the project work
Problems cannot be solved at the same level of awareness that created them.
Albert Einstein
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
The structure of the project work
Italy Germany Project work
2006-2007 2008 2009
Introduce theaudience totheLove2Printproductsdescribingthe Italianexperience
Describe theexperience inGermanyfrom thedecision towrite thebusinessplan to itseffects.
Revisit theBusinessPlan
Compare to theReference Model andidentify areas ofimprovement
Reload thebusiness plan
Share lessonslearnt
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
The Italian business experience
A selection of six success stories describes bestLove2Print’s business opportunity.
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Bayer HealthCare (2006)
This 3D counter displayaccompanied the TVadvertising for the launch ofthe new instant Aspirin®.
500 units have beendeveloped creatively,produced, assembled anddelivered to one address.
Lead time from firstpresentation to production: 6months.
Number of visits/ meetings: 3
Click on the image to viewthe pitch presentation.
Slide with a link
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Lufthansa (2006-2008)
Lufthansa was looking for ways to communicate differently than beforeand welcomed a more pragmatic creativity. Also, they just came from abad experience with an agency that repeated a project with acompetitor.
In three years I was able to run 6 different projects with this samecustomer. All of these were addressed to special business areas suchas:
- Private jet flyers (250 leather notebooks)- HON members (250 leather notebooks with their name printed on it)- Travel agencies (350 weekly desk agendas with the name of the contactperson on each week page and on the cover, different oover for men/women)- Companies registering online to Star Alliance Company Plus Programme(3.000 notebooks with packaging)
This information card has been ordered twice (20.000 units totally)
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Car dealers of Fiat Group (2007)
5 car dealers of FIAT (Milan and Torino) teamed up to make acommon gift to all people who visited them during the week end oflaunch of the Fiat 500. They chose the ultrathin mouse pad (calledipad).
3.000 pieces were produced in 5 batches with the different names ofthe car dealers. They were also delivered separately last minute toeach car dealer.We had only 2 weeks to make a proposal, prepare the artowrk anddeliver.on tima.
The iSticker (Platinum) was developed to be distributed in the centreof city just before Christmas during the presentation of the newLancia ypsilon in Saronno.Again the challenge was to be fast as we were given only two weeksto “invent” the gadget and produce it.
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Tucano (2008)
Tucano was looking for amore consistent way ofpresenting their newproducts to the press and ofpresenting offers to biggerreatil accounts abroad suchas Dixons for example.
They produced 1.000 piecesand reordered again.The artwork was provided bythem (they hav an internaloffice).
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
The challenge (mid 2007)
In April 2007 I moved to Berlin (Germany) for personalreasons and (intuitively) planned a new “start up”based on the successful track record in Italy.
Despite the advantage of speaking the language (mothertongue), the start up in Germany was challengingbecause:
• No network• Little money• Little knowledge about the new market
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
The response to the challenge (end 2007)
• No networkparticipate to a business plan competition
• No moneysubmit the business plan to the bank
• Little knowledge about the German marketthe preparatory discussions with the tutors of the business plan competition, the
bank consultants and my German fiscal advisor helped me understand theacceptance of Love2Print on the German market
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Achieved results (mid 2008)
Business plan competitionranked 16th out of 143 participants
Bankreceived approval for a credit of 10.000 €
Neonred, Tucano and Easibind contributed(each 2.000 €) to the OnePieceMailer directmailing action
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Approach to the review
Compare the content of the Love2Print Business Plan with theReference Model suggested by Prof. Raffaello Balocco (CorporateStrategy);
Identify the areas of improvement, select three of them and revisitthem according to models and methodology learnt from the relevantcourses.
Reload the business plan
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Compare the business plans
Transfer the structure of the Reference Model to Excel including titles andexcluding descriptions
Evaluate for each area of the Reference Model how the content of theLovetoPrint Business can be considered complete:– Green background means that the content is ok– Yellow background means that the content can be improved– Red background means that the content is missing
The areas of improvement can be identified visually.
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Areas of major improvement
Reference Model1. Executive summary2. Description of the enterprise3. Description of the product4. Strategy plan5. Marketing plan6. Operational plan7. Organizational plan8. Financial structure9. Economical & financial
Simulation10. Start up Roadmap
Red text: areas where incomplete/missing content is higherthan the “ok” content.
Level of Detail 0 Level of detail 1 Level of detail 2
summary business idea
summary attrattività dell'area di business
summary risorse/ competenze
summary risultati previstisummary obiettivi del business plan
description of the enterprise competitive positioning (abel)
description of the enterprise value chaindescription of the enterprise enterprise group
description of the product physical description of the product
description of the product usage
description of the product unique selling proposition
description of the product product readiness
strategy plan vision
strategy plan mission
strategy plan objectives and constraints
strategy plan SWOT external macro external variables
strategy plan SWOT external strategic segmentation
strategy plan SWOT external competition in extended terms
strategy plan SWOT external internal rivalry
strategy plan SWOT external potential new players
strategy plan SWOT external subsitution products
strategy plan SWOT internal start up - competencies availablestrategy plan SWOT internal start up - competencies to develop
marketing plan market evaulation available market (bottom up)
marketing plan market evaulation sources of information
marketing plan marketing mix product
marketing plan marketing mix price
marketing plan marketing mix placement
marketing plan marketing mix promotionmarketing plan marketing budget
Operational and organizational plan key processes identify key processes
Operational and organizational plan key processes identify border processes
Operational and organizational plan key processes
consistency of output against competitive
positioning
Operational and organizational plan key processes management logics
Operational and organizational plan key processes process mapping
Operational and organizational plan ressources and input assets
Operational and organizational plan ressources and input input
Operational and organizational plan ressources and input suppliers
Operational and organizational plan ressources and input cost modelling
Operational and organizational plan organization and personell people
Operational and organizational plan organization and personell organization
Operational and organizational plan organization and personell people managament systemOperational and organizational plan organization and personell staff and development
financial structure type of business entity
financial structure sources of financing
financial structure financial requirements
economical and financial projections hyothesis/ assumptions
economical and financial projections
projected balance sheet and profitability/ cash
flow
economical and financial projections net cash flow
economical and financial projections financial requirements
economical and financial projections financial and economical risk
Missing
Incomplete/ can be improved
Ok Slide with a link
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
StrategyVision, Mission & ObjectivesCompetitive positioning (Abell)Product clusteringExternal analysis (5 competitive forces)PEST analysis (strategic segmentation)Internal analysis (value chain model)Management team and company set up
Marketing planMarket analysisMarketing mix
Economics
Reload core parts of the business plan
Reference Model1. Executive summary2. Description of the enterprise3. Description of the product4. Strategy plan5. Marketing plan6. Operational plan7. Organizational plan8. Financial structure9. Economical & financial
Simulation10. Start up Roadmap
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Approach to the Reloading
• The content of the business plan has been translated into English(from German)
• The areas of improvement previously identified have been (a)structured according to the chosen methodology and (b)“reloaded” to fix the issues that became visible thanks to the“methodological filter”
• The result is a sequence of original/ reloaded versions of thesame problem.
• Each section is divided by an “index slide”• At the end of each section there is a summarizing slide
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
StrategyVision, Mission & ObjectivesCompetitive positioning (Abell)Product descriptionExternal analysis (5 competitive forces)PEST analysis (strategic segmentation)Internal analysis (value chain model)Enterprise structure
Marketing planMarket analysisMarketing mix
Economics
Reload core parts of the business plan
Reference Model1. Executive summary2. Description of the enterprise3. Description of the product4. Strategy plan5. Marketing plan6. Operational plan7. Organizational plan8. Financial structure9. Economical & financial
Simulation10. Start up Roadmap
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Vision, Mission and business objectives
Vision/ MissionObjectives/ Constraints
External analysis- 5 forces
Internal analysis-resources & competences
SWOT analysis
Strategic plan
Issue:This statement is insufficient because it does not
describe the future vision of the industry, notdoes it show the way to this future vision.
Definition of the business objectives to realize thefinancial and economical results is missing.
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Vision and Mission Reloaded
Vision: From a standard gadget to an affordable and effective corporatedesign item which is attractive and (environmentally) intelligent at the sametime.
Mission: Maximise the effect of branded material, reduce its expenditure tothe core without compromise on quality or effectiveness and last but notleast enable the introduction of environmentally friendly solutions.
Objectives:- 1st mover to replace laminated printed products- Reach a customer base of 10 customers per year that spend 20.000 €/each or 50 customers that spend 4.000 €/ each;- Reach a gross margin higher than 40% at each order;- Pay back in 4 years.
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Abell matrix
Customer need
Customer groups
Alternative technology
Laminated paper
Polypropylene
Issue:- Customer needs aredefined in an ambiguousway (cannot be measurednor accessed)- Customer groups are nothomogenous
Agencies
Top National com
panies
Tpo multinational com
paniesElectronic media
Innovate the image of the company
Acquire tangibility
Improve consistency with the missionH
ihg public visibility
Sell virtual products
Technically innovative
Care for their im
age
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Abell matrix Reloaded
Customer need
Customer groups
Alternative technology
Laminated paper
Polypropylene
To promote a new product
To educate and train users
To document
To reward personel or customers
Hospitals/ P
harma industry
Transportation companies
High Technology
Banks/ Insurances
Business S
chools
- Customer needs are definedprecisely- Customer groups arehomogenous
This positioning allows to:- identify customers uniquely- communicate consistently tothe industry- measure the attractivenessof the market
Electronic media
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Enterprise structure
Love2print is agent of two leading producers who have committed to providetheir customers with a highly personalized, functional and innovativecorporate product.
EASIBIND INTERNATIONAL/ the innovative & unconventionalleader in high brand corporate products
the leading PC apparel company
Love2print is to be owned by:
51% Caecilie Hechtel/ general manager, 12 years experiencein international corporate world and digital printing market
49% Fabio Piva/ financing partner, 25 years experience inmarketing across industries.
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Enterprise structure Reloaded
As a result of the internal analysis, Love2print becomes a business unit and a trademarkof the multimedia communication agency Neonred that deals with printed material.Caecilie Hechtel is hired by Neonred with an option to become partner as soon as thelovetoprint business reaches break even.
Slide with a link
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Macro environment
Issue:The strategic segmentation is missing. Important
information is disconnected (parts are under“products” and other parts are in the“executive summary”). The identification of themacro segments and the focus when definingthe marketing plan gets lost.
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Macro environment Reloaded
Political Taxation of environmental impact (carbon footprint)European countries to reach 30% reduction in carbon footprint by 2012.
Economical Uncertain demand across industries (leads to reduced advertising budgets).Growing non-classical advertising market(Industry Report of Dresdner Bank)).
Sociodemographic Increasing attention and commitment to Corporate Social Responsibility issues (McKinsey Quarterly Report “Addressing Consumer concerns on Climate Change”.)
Increasing attention to hygienic issues.
Technological Digital silk screen technology reaches offset like color print qualityPolyprolyene can be coated with Biocote® or Extraprotect@ to reach higher hygiene levels and last longer
Slide with a link
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Macro segmentation Reloaded
HIG
HLO
W
HIGH LOW
PUBLIC VISIBILITY
CO
MM
ITM
EN
T T
O T
HE
EN
VIR
ON
ME
NT
LO
NG
SH
OR
T
HIGH LOW
LEVELS OF HYGIENE
LIF
ETIM
E O
F T
HE
IN
FO
RM
ATIO
N
Thanks to the information about the product features it is possible to position the target market(segment) on a strategic level clearly by combining relevant characteristics of the marketplayers. When defining the marketing plan it will be easier to be focused.
Laminated product
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Competitive positioning Reloaded
This result shows a strong focus on the side of the suppliers (owners of technology). LovetoPrint asnew entrant without production is very weak within this net of competitive forces. If LovetoPrintpartners up with one of the key suppliers it can strengthen its competitive position significantly.
3.000 agencies servepotential 382.000 customers(130 customers each agency)
Alternative products cost until50% of the price of a PPproduct, costs of creativityexcluded.
Few print companies have enough volume topay it back quickly enough. The cost oftechnolgy is very high (> 1 mio Euro), risk ofobscolescence of technology too, highvolumes are needed + experience andcompetence to print on PP is needed too.
The contact with suppliers is indirect (normallythrough agencies). Customers are notknowledgeable about the different alternatives:The negotiation happens on a higher level.
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Internal analysis (value chain)
Identified issue:- Unbalanced share between primary and supporting activities suggests to insourceactivities to improve margins and competitiveness (resources & competences);-The costs of maintaining the firm infrastructure risk to be higher than the sales. Thispositioning is long term insufficient to sustain and grow the business.
Buy
Graphic design
Prototyping
Final product
Transport
Make
Communication
Sales
Assembly
Suppliers
Customers
100% new acquisitions
Agency
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Internal analysis (value chain) Reloaded
Opportunity:Insource creative “buy” activities:- improve resources and competencies- increase value added of internal primary activities- save on infrastructure costs (office/ legal advisory/ fiscal advisory/ admin)- acquire an existing customer base to start from
Buy
Final product
Transport
Make
Communication
Sales
Assembly
Graphic design
Prototyping
Suppliers
Customers
100% new acquisitions
Neonred customers(see on the web)
Partners
Slide with a link
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
SWOT analysis
Issue:
This result shows a strong focus on the side ofthe suppliers (owners of technology).LovetoPrint as new entrant without productionis very weak within this net of competitiveforces. If LovetoPrint partners up with one of thekey suppliers it can strengthen its competitiveposition significantly.
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
SWOT analysis Reloaded
Strengths- First mover advantage (in D)- Sales Manager competence & experience- Experience & competence Neonred inMultimedia Technology- Cost efficiency of production, latesttechnology and experience of Easibind- International Team- Ability to fast realization- “One Stop Shop” (full service agency)
Weaknesses- Premium Price during recession times- Geographical distance of Neonred,Easibind and Caecilie Hechtel- Small (not main) unit within a biggerbusiness of Neonred- Production outsourced, margins driven byproduct development service mainly
Opportunities- No direct competition, unique proposition- Our products can contribute significantlyto companies’ “Carbon Footprintreduction” programme- Environmentally intelligent withoutcompromise on quality or effect- Through higher hygiene and durability ofthe material possibility to save on overallproduced volume
Threats- Long sales process with little room forinfluencing after the first pitch (firstimpression only counts)- Risk of substitution with cheaper solutions- Due to the complexity of the offer risk ofbeing misunderstood
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Strategy Plan Reloaded
Vision/ MissionObjectives/ Constraints
External analysis Internal analysis
Vision: From a standard gadget to anaffordable and effective corporate designitem which is attractive and(environmentally) intelligent at the sametime.Mission: Maximise the effect of brandedmaterial, reduce its expenditure to the corewithout compromise on quality oreffectiveness and last but not least enablethe introduction of environmentally friendlysolutions.
Business Objectives-1st mover to replace laminated printedproducts
- Reach a customer base of 10 customersper year that spend 20.000 €/ each or 50customers that spend 4.000 €/ each;
- Reach a gross margin higher than 40% ateach order;
- Pay back in year 4
HIG
HLO
W
HIGH LOW
PUBLIC VISIBILITY
CO
MM
ITM
EN
T T
O T
HE
EN
VIR
ON
ME
NT
LO
NG
SH
OR
T
HIGH LOW
LEVELS OF HYGIENE
LIF
ET
IME
OF T
HE
IN
FO
RM
AT
ION
T W
O S
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
StrategyVision, Mission & ObjectivesCompetitive positioning (Abell)Product descriptionExternal analysis (5 competitive forces)PEST analysis (strategic segmentation)Internal analysis (value chain model)Enterprise structure
Marketing planMarket analysisMarketing mix
Economics
Reload core parts of the business plan
Reference Model1. Executive summary2. Description of the enterprise3. Description of the product4. Strategy plan5. Marketing plan6. Operational plan7. Organizational plan8. Financial structure9. Economical & financial
Simulation10. Start up Roadmap
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
The market
Issues:
Market is inconsistent(too small) with thebusiness objectivespreviously defined.
According to thebusiness objectives(volume) LovetoPrintshould reach a marketshare of between 2%and 10% which is anunrealistic result for anew entrant with a weakcompetitive position.
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
The market Reloaded
Potential market382.000 advertising active companies
Available market10.075 exhibit at relevant fairs*
Served market971 employ more than 50 employees+ are ISO 14001 certified
Penetrated marketCustomers of LovetoPrint ItalyCustomers of Easibind UK with offices in DCustomers & prospects of NeonRed
*Relevant Fairs:ENTSORGACEBITIAA carsIAA trucks
Source of information:General CD addresses database of Deutsche Post (2007)B2B Catalogue of Deutsche Post (2009)
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Product
Issue:
It is visually difficult toidentify the hierarchy of thedifferent products/ services.
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Product hierarchy
Goods
Product family Product range Final product
Service
Ad Hoc Projects
Mix of standard products
Prototyping
Product development
standard product
Art work design
Assembly and distribution
Low environmentalimpact solutions
Trendy, technicaland functional high
end promotionalitems
Long Life
Short Life
Prepare the reload:
To better review theproduct definition Ihave describe theoriginal LovetoPrintproduct hierarchyvisually.
The weakness of theproduct definitionbecomes moreevident.
Lifetime (long/ short)of products is a toogeneral feature thatdoes not add valueto the producthierarchy.
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Product hierarchy Reloaded
Ad Hoc Projects
Mix of standard products
standard product
Product development
Prototyping
Art work design
Production
Assembly &distribution
Art work design
Production
Assembly & distribution
Final product
Trendy and functional promotional items (Tucano)products have been excluded from the official range ofproducts to improve focus of proposition and eliminaterisk of loss of credibility as Tucano products do not fulfillthe environmental claim.
Lifetime has been replaced with “application” on thecustomer’s side. This improves the proximity to theneeds of the market making it easier for customers toidentify their needs.
Promotional
Corporate Stationery
Point of Sale & Display
Response mail
Low environmental impact solutions
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Corporate StationeryNotebooks, Pouches, Wallets, Folders, Organisers
Point of Sale & DisplayLeaflet Dispensers, Wobblers, Hanging Displays, Window Stickers
PromotionalGift Boxes, Gizmos, Bundled Packs, Sleeves
Response MailOne Piece Mailer, Invitations, DL Inserts
Product range Reloaded 39
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Price
This definition doesnot show thestructure of a typicalproduct in a way thatis consistent with theoffer to the customerand to the producthierarchy.
There is a need todefine price n a waythat quick answerscan be given tointerested potentialcustomers with apreview of theperspective benefits.
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Price
+ 25% - 40%Final product
1:1 charge7 €/ hour for assembly
Assembly & Distribution
Fixed charge of 250,00 € minimumPrototyping
Minimum charge of 250,00 €Graphic Design
Minimum charge of 450,00 €Product Development
Issues:
Prices are calculatedfrom scratch every timea customer makes aninquiry and are notprecise because all finalvariables/ featuresbecome known after thefinal definition of allfeatures. Vicious circle.
All goods/ services(except ProductDevelopment) are “buy &sell”, this means that theproduct developmentservice is to carry allmargins otherwise thefinal solution is tooexpensive compared tothe market value of thesold product.
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Price Reloaded
+ 25% - 40%Final product
1:1 charge7 €/ hour for assembly
Assembly & Distribution
Fixed charge of 250,00 € minimumPrototyping
Minimum charge of 250,00 €Graphic Design
Minimum charge of 450,00 €Product Development
Standard products
A Pricelist will be defined according to a selection of TOP 50 most sold applications
Prices to include:Product Development Graphic Design
Disounts are granted at second and third reorder ofsame product
Ad hoc project
Depending on the strategicrelevance of the project being part of NEONRED agency here is more room for cuttin margins.
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Place
Direct sales viacold acquisition
Direct sales to all (agencies included).All are considered “customers” at the same level of distribution and pay same price.
Issue:As Product Development costs carry the most part of the margin they have be charged to agencies too. This has apenalizing effect on the final price that the target customer will pay because the agency as intermediate player willcharge their own services + uplift the cost of our product development cost, too. The final price becomes tooexpensive to have a real chance on the market. For this reason agencies cannot be considered neither a distributionchannel nor part of the target group.
Served market
Penetrated market
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Place Reloaded
Direct sales viacold acquisition
Cross selling to NR customers
Aided Direct sales
The served market will be addressed via Direct SalesThe penetrated market will be addressed through Cross Selling and through aided Direct SalesThe aid consists of existing graphic material (used for other projects that can be adapted to make a more personalizedfirst contact), contact names and overl knowledge about & experience with the target customer.
Served market
Penetrated market
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Promotion Mix
Direct mailing
Electronic presentation
Sample pack
Networking
Ads on specializedMagazine W&V
Sales Promotion
Advertising
Sales Force
Public Relations
Direct Mail Telemarketing, Web
Explicative Folder
Web page
Mail Teaser Magazines Website
Issues:
Too complex andexpensive comparedto the distibutionchannel made of onlydirect sales withoutsales force (one manshow)
Testing of theeffectiveness of thecommunicationcontent is missing.
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Promotion Mix Reloaded
Direct mailing
Sales Promotion
Advertising
Sales Force
Public Relations
Direct Mail Telemarketing, Web
Micro web page (click)
We sinergize with Neonred’s existing activities
OPM’s role is to enter the customer’s “castle of awareness” like a troyian horse. OPM allows to submit a quotequickly (all prices are known beforehand in a material/quantity matrix) and to keep prices low as costs of productdevelopment are saved.This set up also allows to benefit from the existing infrastrucutre of Neonred.
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Marketing strategy
ProductsServices
Price
Promotion mix Distribution channels Targetcustomers
Direct mailing
Electronic company presentation
Sample pack
PR Networking
Ads on specializedmagazines
Direct sales viacold acquisition
Top int companiesTop nat companies
BanksCompaniesAgencies
L2P Sells In
AgencySells out
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Marketing strategy Reloaded
ProductsServices
Price
Promotion mix Distribution channels Targetcustomers
Direct sales viacold acquisition
Aided Direct sales
Cross selling
Direct mailing
Micro web page (click)
Ad Hoc proposal (click)
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
StrategyVision, Mission & ObjectivesCompetitive positioning (Abell)Product descriptionExternal analysis (5 competitive forces)PEST analysis (strategic segmentation)Internal analysis (value chain model)Enterprise structure
Marketing planMarket analysisMarketing mix
Economics
Reload core parts of the business plan
Reference Model1. Executive summary2. Description of the enterprise3. Description of the product4. Strategy plan5. Marketing plan6. Operational plan7. Organizational plan8. Financial structure9. Economical & financial
Simulation10. Start up Roadmap
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
P&L first 3 years Reloaded
2008 2009 2010 Year 1 Year 2 Year 3
! ! ! ! ! !
Sales
a) Easibind (Ware) 40.000,00 120.000,00 180.000,00 60.000,00 72.000,00 86.400,00
b) Tucano (Provision) 5.500,00 24.000,00 36.000,00 0,00 0,00 0,00
c) Services 6.000,00 12.000,00 12.000,00 60.000,00 66.000,00 72.600,00
51.500,00 156.000,00 228.000,00 435.500,00 120.000,00 138.000,00 159.000,00 417.000,00
Cost of Goods sold 30.000,00 90.000,00 135.000,00 42.857,14 51.428,57 61.714,29
Gross margin 21.500,00 66.000,00 93.000,00 180.500,00 77.142,86 86.571,43 97.285,71 261.000,00
42% 42% 41% 64% 63% 61%
Personel 14.000,00 24.000,00 24.000,00 62.000,00 54.000,00 54.000,00 54.000,00 162.000,00
Write off 350,00 600,00 600,00 1.550,00 0,00 0,00 0,00 0,00
Rent 6.650,00 11.400,00 11.400,00 29.450,00 0,00 0,00 0,00 0,00
Gas, Electricity, Water, ecc 0,00 0,00 0,00 0,00 0,00 0,00 0,00 0,00
Insurancs 0,00 0,00 0,00 0,00 0,00 0,00 0,00 0,00
Various charges 0,00 0,00 0,00 0,00 0,00 0,00 0,00 0,00
Maintenance equiment 0,00 0,00 0,00 0,00 0,00 0,00 0,00 0,00
Car insurance 350,00 600,00 600,00 1.550,00 0,00 0,00 0,00 0,00
Car tax 175,00 300,00 300,00 775,00 0,00 0,00 0,00 0,00
Car Repair 0,00 0,00 0,00 0,00 0,00 0,00 0,00 0,00
Car costs 1.484,00 2.544,00 2.544,00 6.572,00 0,00 0,00 0,00 0,00
Advertising costs 13.800,00 5.650,00 5.650,00 25.100,00 10.000,00 5.000,00 5.000,00 20.000,00
Travel expenses 3.500,00 6.000,00 6.000,00 15.500,00 6.000,00 6.000,00 6.000,00 18.000,00
Representation costs 1.750,00 3.000,00 3.000,00 7.750,00 0,00 0,00 0,00 0,00
Postage 0,00 0,00 0,00 0,00 0,00 0,00 0,00 0,00
Telefon, Fax, Internet 1.400,00 2.400,00 2.400,00 6.200,00 2.400,00 2.400,00 2.400,00 7.200,00
Bookkeeping, tax advisor 2.050,00 3.000,00 3.000,00 8.050,00 0,00 3.000,00 3.000,00 6.000,00
Fouding costs (one time) 9.500,00 0,00 0,00 9.500,00 0,00 0,00 0,00 0,00
Cost of money -15,00 -30,00 -100,00 -145,00 0,00 0,00 0,00 0,00
Literature 450,00 600,00 600,00 1.650,00 0,00 0,00 0,00 0,00
Office supply 450,00 600,00 600,00 1.650,00 0,00 0,00 0,00 0,00
Interests (long term credit) 1.764,00 3.024,00 2.969,44 7.757,44 0,00 0,00 0,00 0,00
Interest (short term credit) 352,00 50,00 0,00 402,00 0,00 0,00 0,00 0,00
Other costs 0,00 0,00 0,00 0,00 0,00 0,00 0,00 0,00
Total costs 58.010,00 63.738,00 63.563,44 185.311,44 72.400,00 70.400,00 70.400,00 213.200,00
Profit/ Loss -36.510,00 2.262,00 29.436,56 -4.811,44 4.742,86 16.171,43 26.885,71 47.800,00
-71% 1% 13% 4% 12% 17%
RELOADED
The enterprisestructure combinedto the marketingmix of the reloadedbusiness planshows importantimprovements interms of
gross margin(+45%/ +80.500 €)andgross profit(+50.000 €)
with comparablelevels of sales.
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Cash Flow Reloaded
The cash flow of the original lovetoprintbusiness plan showed a higher need forexternal credit
The Reloaded cash flow is improved.
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
The structure of the project work
Italy Germany Project work
2006-2007 2008 2009
Introduce theaudience totheLove2Printproductsdescribingthe Italianexperience
Describe theexperience inGermanyfrom thedecision towrite thebusinessplan to itseffects.
Revisit theBusinessPlan
Compare to theReference Model andidentify areas ofimprovement
Reload thebusiness plan
Share lessonslearnt
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Lessons learnt (running my own business)
• Save money (fixed costs) to gain time. Gain time to give time a chance toshow results.
• Build on success and resist the temptation to accept any challenge. Setspecific targets to know when the efforts are (chronically) higher than theachieved results.
• Be extremely selective before choosing your partners and extremelyconfident after to benefit fully from their experience and competence.
• Walk ahead alone only exceptionally. Ensure commitment is aligned andmanage “ownership and empowerment” as a stand alone key elementto the overall success of the business.
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27/11/2009 | Tutor: Prof. Raffaello Balocco | Author: Caecilie Hechtel | [email protected]
Backup
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