Overview of Business idea
A business plan is known as the written explanation of the future of the business. It is a document that explains what has been planned to do and how will be executed (Ekanem, 2017). Business plans could support in performing various tasks for those who live to write and read. The entrepreneurs who are in search of investment-seeking projects utilize these business plans and transfer their vision to the prospective investors (Tiffany, Peterson & Barrow, 2012). The companies that are putting their efforts to appeal main workforces, vision for new business, and contract with suppliers or just to understand, how to handle their business might also utilize them (Finch, 2013). The aim of this report is to frame a business plan for an affordable as well as innovative idea that is Built Custom. This idea is majorly focused towards manufacturing of custom cabinet for the resort, small residential and commercial market in the United States market. This business plan will cover all the essential business aspects such as background, target market, feasibility analysis, and business model template.
It is a business idea that will be based on manufacturing custom cabinets for resorts, small residential and commercial markets. Mr. Daniel with less experience in the construction industry has created this business pan. The name that has been decided of the business is Built Custom. The business will have its physical office along with staff, low cost of administration because of a small budget. As Mr. Daniel was the part of some construction business, he identified the requirement of cabinet line with a broad selection like processing, quality, and design. Build Custom will meet the needs of those customers. It could be analyzed that the business plan will successfully make a good positing in the commercial, resort, and residential segment, the revenue of the plan will increase considerably in two to three years. The owner has done a small amount of investment as a capital in the business.
The business objective of Built Custom is to become the top supplier and lead the market of the cabinet to achieve a good position in the market to possess considerable growth in the context of revenue and consumers. Besides this, the idea is focused towards comforting their customers by offering them a required place to maintain their files and material.
The business Built Custom will provide reasonable and quality supplier market of cabinet to meet the construction, challenging organizational and quality needs. Moreover, the business is focused towards offering affordable and quality infrastructure to the small residential and business areas.
Built Custom- Objective
Overall costs of the start-up will include tools, stationery, and other related expenses. There is only one owner in the business that will focus on arranging the initial start-up cost.
The business products are mostly designed of two key elements i.e. the boxes and shelves would be delivered from single supplier in the form of kitset. Besides this, one of the local suppliers will provide the delivery of doors, panel, and drawer. The company will hire two designers competent in manufacturing custom finishes.
Build Customs Company will focus on the suppliers, owners, and designers of the local area who are involved in the development of the residential, resort, and commercial segment. In the U.S, the manufacturing and retailing of the furniture are very important element of the country’s economy (IBIS World, 2018). The global industry of home goods comprises retailing, manufacturing, and distribution of the commercial as well as residential furniture. At the economic recession time, the entire furniture industry was negatively influenced by this because consumers were cutting down their expenditures on the elements that were not much essential, putting the development of commercial and residential part due to low disposable income (IBIS World, 2018). In 2016, the stores of furniture have received sales of approx. 106.78 billion U.S dollars (Statista, 2018).
Built Custom will be focusing towards contacting with the contractors and architects who majorly deals in the residential market. The company will work to increase its brand recognition among these entities in order to create tough front-runners, along with this receiving the personal recommendations to the owners of the home.
The U.S industry of furniture is competitive, as it comprises key players in the same kind of services that are Bernhardt Furniture and Hancock & Moore.
Jimmy Moore established Hancock & Moore Company in 1981 with headquarter in Hickory North Carolina (Hickory Park, 2018). It specializes in the furniture with contemporary, custom-made, modern, and traditional design and offers low as well as a mid-price line of material. The products of the company are handmade and offer its services in the United States market (Boyles Brand, 2018). All the products of the company take approx. 80 hours to get the finished look, and are accessible in different options such as wood, trim, fabric, leather. The company involves strict policies for the smooth operations of different activities and these policies are called in-house environmental policies (Lexington Furniture, 2015).
Bernhardt Furniture was established in 1889 with headquarter in the North Carolina (Bernhardt, 2018). The company makes white oak furniture for the customers in the local market. The company has very quickly increased its operations because of effective relations with the distributors and merchants (Goods Home Furnishings, 2018). Besides this, the company takes the support of rail mode of transport for the delivery of bedroom furniture, chests, tables, and cabinets in the market of big cities across the country (Ryan, 2018). By 1958, the product line of the company was extended to involve furniture for the residency area, along with the country’s showrooms and offices. Due to all these achievements and operations of Bernhardt Furniture Company, it was known as the benchmark business in the industry (Bloomberg, 2018).
Built Custom- Mission
The companies Hancock & Moore and Bernhardt Furniture Company are two of the strongest business that is a big threat to small as well as big retailers in the market (Chrinian, 2017). It reflects that Built Customs will experience huge competition from these two key players in the market, so, to sustain and get a competitive advantage it has to make different strategies.
The domestic market for furniture involves numerous competitors. However, all of them provide products that are of good quality. Some features that dominate the number of every galley projects are services, scope, design, and product (Fung Global, 2018). Numerous people imperfectly possess the thought that the size of the project and the big brands will provide the best services. However, this perception is wrong because the design is the feature that provides the maximum effect on the quality and value of the customer investment.
The company will attract customers by using the pitch “Come let’s make your world more beautiful.” Here, the advertisement will focus on making a home or commercial area more beautiful by equipping custom cabinets and furniture. The word ‘world’ here signifies home and office, which according to many people is their world.
The democratic position of US ranks second across the world. US president is appointed for a term of 4 years and for that, particular tenure the political aspect of the economy is overlooked by the appointed president (Pestle Analysis, 2014). As the business of Built customs is proposed to be operated in the United States, the company will have to duly comply with all the regulatory laws and provisions that are in existence in the US and applies to the furniture manufacturing industry. Various regulatory agencies regulate the industry to which the proposed business belongs such as patent act, trademark act, environmental act etc. US government encourages the US entrepreneurs to bring up innovative and unique ideas to allow them positively contribute to the country’s growth as well as its development.
The economic condition of the United States is quite strong and it is the largest economy in the world in terms of its per capita GDP. The leading corporations constitute US economy such as Microsoft Google, Apple Inc., Mc. Donald’s, Coca-Cola etc. These multi-national corporations contribute significantly to the economic development of the country by generating high revenues and employment opportunities for US nationals. However, after the financial crisis of 2008, the economic condition of the country was severely affected but in the post-crisis, the economy has shown drastic changes in the areas of growth and development (Pestle Analysis, 2014). Due to the firm economic state of the country, it would be an opportunity for the company to operate its business in the United States.
Start-up Summary
The United States ranks at the third position in the entire globe in terms of its population. It is generally observed under various surveys that in every 8 seconds, a birth takes place. In the country that is densely populated, it is quite evitable for the companies operating in such a country, to emphasize on fulfilling its corporate social responsibilities in order to operate smoothly and successfully (Pestle Analysis, 2014). Before commencing the business, it would be necessary for Build Customs to understand its corporate social responsibilities. In fact, the company has various laws and regulations relating to CSR and each company to which such laws are applicable are required to comply with them. The compliance with such laws will not only allow the company to avoid the legal interventions but will also gain the trust of the business communities, societies, and customers of the company about the ethical business practices. Various social practices firm can take up to promote the well-being of the society such as sustainable development initiatives, promotion of employment opportunities, etc.
In terms of technology, the US economy is the leader across the globe. The technological development of the country has majorly contributed to the rapid growth of the country. By far, the company has achieved high growth in the areas of artificial intelligence (Pestle Analysis, 2014). In the countries like the US, it serves a great privilege to operate the business as the business can function efficiently with advanced technology. The business of furniture manufacturing will also be benefitted with the technological advancement of the country.
As the business of furniture manufacturing involves high usage of tree woods, it is important for the company to undertake only those business practices that are environmentally friendly since plants and trees form the most important constituent of the eco-system (Pestle Analysis, 2014). It is necessary for the proposed company to obtain permits from the environmental regulators, to use the woods from the trees. In addition, the manufacturing process of the furniture must be eco-friendly and must not harm the health of any constituents of the environment.
Strength
Built Customers have different strengths that are necessary to conduct the business in the big market such as the United States. The business idea i.e. Built Customs of making cabinets for the resort, commercial, and residencies is very effective because it provides affordable and reasonable cost. The market comprises different businesses that provide a similar type of products but at a high price. On the other side, Built Customs will provide all the products with good quality at a reasonable price.
Products
Weaknesses
Built Customs has worked on every aspect that needs to be perfect in such a competitive environment but it possesses one weaknesses i.e. lack of capital that is also a threat to the business to compete in the market. Moreover, it has few of the skilled, experienced and skilled workforce that work to contribute towards the development of the business.
Opportunity
The market of the United States possesses different opportunities for every type of businesses. The Built Customs can initiate a partnership or joint venture with large companies and can provide its new and innovative ideas so that people can get access to affordable as well as quality services.
Threat
Built Customs will initiate its operations in the United States market that is comprised of huge competition, which is one of the threats for the company. Besides this, because of a lack of capital, it could experience barriers to the long-term survival in the market. Hence, Built Customs should create strategies that could help it in avoiding these barriers as well as threats.
A feasibility analysis is a study that is used to measure the capability and probability to finish a project effectively comprising all relevant factors. It should be comprised of the factors that influence it like technological, financial, and legal, etc. (Havard, 2013)
Although, Built Customs is a low budget business idea but the owner of the business that is Mr. Daniel is very much familiar in this manufacturing sector of furniture, which reflects that he is capable enough to arrange all the funds for the business that will be required in the future. The company could arrange funds in the future from different sources such as financial institutions, banks, equity shares, etc. Financial competency is very important for every business in the market hence; Built Customs needs to manage all the funds and its position in the market.
Technology in today’s environment is very essential for the growth as well as productivity of the business. Technology helps in reducing the cost and time to manufacture a product or service (O’Loughlin, 2013). Built Customs will offer its quality furniture at low cost because it has planned to invest most of the amount to buy the advanced technology, which will eventually reduce the price as well as time consumed in manufacturing the furniture.
A thorough legal analysis is performed to ensure that all predictable legal necessities, which are necessary for the project development, are fulfilled or not. Built Customs is the company that deals in the manufacturing of furniture, which comprises the use of wood in it. Extraction of wood by cutting down the trees adversely affects the environment and animal life. Therefore, Built Customs Company will ensure that all the legal requirements such as Companies law, Clean Air Act, and Resource Conversation and Recovery Act are fulfilled and followed effectively (Carnegie Mellon University, 2003).
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Key Partners ü Designers, ü Furniture Stores, ü Decorators, ü Brands, ü Interior |
Key Activities ü Manufacturing of quality furniture at low cost ü Managing the demand of the customers ü Effectively dealing with designers, suppliers, employees, and customers |
Value Proposition Customers We offer quality standard furniture at a very reasonable price. |
Customer Relationship Get Word of mouth, paid search, referrals from decorators and merchants Keep We allow consumers to exchange their type of furniture and fulfill their changing requirements when they move from one place to another. Grow Cross-sell and up-sell of other products when the company will grow |
Customer Segments Customer Profile Families Residencies Commercial areas or infrastructure Resorts |
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Key Resources ü List of Customers ü Refurbishing Center ü Shipping Material |
Channels ü Website ü Brick and mortar ü Stores ü Social Media |
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Cost Structure Buy furniture at low cost on demand, refurbishment, pick up cost, and, warehouse |
Revenue Streams ü Home delivery of the product at affordable prices |
Industry Analysis
The basic idea behind keeping the prices of Build Customs is to grab wide customer base in the furniture manufacturing industry. As the business is entirely new but the industry to which it belongs is in existence since long years, it is quite obvious that the people in US are quite familiar with the furniture products and quality and utility of different sort of furniture items. As wooden cabinet is a common type of furniture products, the demand for such product prevails in both commercial and domestic market. Hence, it is aimed to grab a large market place by adopting penetration-pricing policies and by the manufacturing of different types of cabinets. As the basic motive behind keeping the lower prices is to achieve competitive advantage over other existing furniture manufacturers, the quality of the wooden product must also be given highest priority. If both prices and quality are maintained as per the customer centric approach, it would become easy for the company to enter into the market more smoothly and to gain large customer-base.
Conclusion
From the above analysis, it could be said that Built Customs business idea will be proved as one of the successful start-ups in the coming future because the demand for custom made cabinets in the commercial, resort, as well as residential sectors is increasing. Moreover, the company will offer all its services at low cost with good quality. The analysis reflects that the company could operate in the United States market because presently it is growing very rapidly, which reflects that it will provide good profit margins to the businesses.
References
Bernhardt. (2018). About Bernhardt. Retrieved from https://www.bernhardt.com/
Bloomberg. (2018). Company Overview of Bernhardt Furniture Company, Inc. Retrieved from https://www.bloomberg.com/research/stocks/private/snapshot.asp?privcapId=4273138
Boyles Brand. (2018). Hancock & Moore. Retrieved from https://www.boyles.com/hancock-moore
Carnegie Mellon University. (2003). Main US Environmental Laws. Retrieved from https://environ.andrew.cmu.edu/m3/s7/us_laws.shtml
Chrinian, E. (2017). The Furniture Industry Is Now More Competitive Than Ever. Retrieved from https://eugenechrinian.wordpress.com/2017/06/20/the-furniture-industry-is-now-more-competitive-than-ever/
Ekanem, I. (2017). Writing a Business Plan: A Practical Guide 1st ed. U.K: Taylor & Francis.
Finch, B. (2013). How to Write a Business Plan 4th ed. U.K: Kogan Page Publishers.
Fung Global. (2018). Deep Dive: US Furniture Market 2017—Stores Face Softer Growth and E-Commerce Competition. Retrieved from https://www.fungglobalretailtech.com/research/deep-dive-us-furniture-market-2017-stores-face-softer-growth-e-commerce-competition/
Goods Home Furnishings. (2018). Bernhardt Furniture. Retrieved from https://www.goodshomefurnishings.com/bernhardtfurniture/
Havard, T. (2013). Financial Feasibility Studies for Property Development: Theory and Practice 1st ed. U.S: Routledge.
Hickory Park. (2018). Hancock & Moore Furniture Store and Showroom in Hickory NC. Retrieved from https://www.hickorypark.com/hancockandmoorefurniture/?gclid=CjwKCAjwoMPcBRAWEiwAiAqZh51MEpDBhGe3xT2cLPzV5VVb-344DYhSxGoNFmPuN3sQXSaqBnpZnxoC2SgQAvD_BwE
IBIS World. (2018). Furniture Stores – US Market Research Report. Retrieved from https://www.ibisworld.com/industry-trends/market-research-reports/retail-trade/furniture-home-furnishings-stores/furniture-stores.html
IBIS World. (2018). Household Furniture Manufacturing – US Market Research Report. Retrieved from https://www.ibisworld.com/industry-trends/market-research-reports/manufacturing/furniture-related-product/household-furniture-manufacturing.html
Lexington Furniture. (2015). Hancock & Moore. Retrieved from https://lexfurniture.com/furniture/brand/hancock-moore
O’Loughlin, J. (2013). The Importance of Technology to the Transcendental Future 1st ed. U.S: Centretruths Digital Media.
Pestle Analysis. (2014). PEST Analysis of the USA, the Largest Economy of the World. Retrieved from https://pestleanalysis.com/pest-analysis-of-usa/
Ryan, M. (2018). Bernhardt – A 125-Year Family Legacy. Retrieved from https://www.bernhardt.com/news/press-releases/bernhardt-125-year-family-legacy
Statista. (2018). U.S. Furniture Retail Market/Industry – Statistics & Facts. Retrieved from https://www.statista.com/topics/1136/us-furniture-retail/
Tiffany, P., Peterson, S.D., & Barrow, C. (2012). Business Plans For Dummies 3rd ed. U.S: John Wiley & Sons.
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