Table of Contents
Executive Summary 1
1. Business description 2
2. Marketing strategy 4
3. Operations plan 8
4. Management plan 9
5. Financial forecast 10
6. Critical Risks 12
7. Conclusion 13
The business plan aims at developing a green project for Phu Binh An Co., Ltd, which operates in Binh Duong province, provide many services including foodstuff supply service. Specially, this presents the plan producing paper bags for packaging foodstuffs of the company.
First of all, the business plan evaluates Phu Binh An Co., Ltd and industry background of the company involved in producing paper bag product. After that, the marketing, operations, management, financial and critical risks in the process of preparing the business plan are analyzed. More specially, the bussiness plan reviews the target market, market size and trends, competition, estimated market share, description on marketing mix in the marketing strategy. It also indentifies location, specific operational procedures, personnel needs and uses, proximity to puppliers in the operations. And it points out the key management team, legal structure, and board of directors in the management issue. In addition, the plan forecasts some finance indicators in 2015 of the plan in the cash flow statement, income statement and proforma balance sheet. Besides, it give some potential problems, obstacle and risks, alternatives courses of action as follows:
• Allocate budget reasonably for this plan;
• Make a difference right from the start in term of material, design and printing techniques.
1. Business description
Overview of the company:
Phu Binh An Co., Ltd was licensed to establish on 18 November, 2008 and official operated in the field of catering industry business and other services in 2009 and located at 705 Huynh Van Luy, Phu My Ward, Thu Dau Mot city, Binh Duong province (Phu Binh An, 2015). Phu Binh An offers the following products and services:
• Providing catering industry
• Designing and consulting canteen
• Providing kitchen equipment
• Providing foodstuffs
• Organizing meetings and parties
• Providing other services: Fast food and drinks package in the factory; meals for foreigners as required.
Vision of Phu Binh An: Become one of Vietnam’s leading companies in the field of catering industry and related services based on truthful and sustainable ethical standards of business, and loved, trusted by the consumers.
Mission of Phu Binh An: “We always bring a safe and quality meal for the community through quality products and services of the company offered by Phu Binh An Limited Company.”
Industry background of the business:
With the supply of products / services listed above, Phu Binh An Co., Ltd focuses on the domestic market, particularly in Binh Duong province (because Binh Duong is the province where the company is headquartered and operated, as well as has many inddustrial parks). Binh Duong, which is one of the provinces with the fastest economic development in Vietnam, has numerous industrial parks (Steward & Coclanis, 2011). Currenty, the catering industry has been increasingly grown in this area because there have been more companies using this service to improve efficiency and demonstrate their corporate social responsibility (CSR).
However, every year, there are dozens of poisoning incidents due to food of workers at companies, factories and children at the schools in Binh Duong (Tuyet, 2015). These affect much the lives and health of workers, reducing labor productivity, causing difficulties for the company and the levels of leadership, especially “food poisoning” because of not ensuring food safety. From there, it can be said that, although the catering industry witnesses an annual growth, the situation of quality assurance for products and services in this sector is still very complex.
Goal of the business:
Phu Binh An expects to service over 20,000 meals per day for the target customers as Saigon Stec Company, Avery Dennison Company, Wanek, Housewares, Tatung, Y & K Fashion Company, Jim Fuyu Company,… coming from Japan, America, Australia, South Korea, and Taiwan (Phu Binh An, 2015).
Potential of the business:
As mentioned above, the mission of Phu Binh An, over six years of development and growth, Phu Binh An has affirmed its position and credibility through serving more than 10,000 meals per day for businesses in the industrial parks (Phu Binh An, 2015). Therefore, with the current development momentum, Phu Binh An has great potential to become one of the leading companies in the catering industry in Binh Duong.
Being a catering service provider, Phu Binh An fulfills responsibilities to consumers, employees, suppliers and shareholders. However, in the future, to further improve CSR activities related to environmental protection, increase of customer awareness and society’s interests, Phu Binh An needs to develop a business plan incorporating green product concept.
As presented above, foodstuff supply is one of the services offered by Phu Binh An. Being an manager of this company, I find that the production of paper bags for the foodstuffs when delivering them to the customer is a useful and insight plan. In fact, the paper bags nowadays almost dominate the packaging market because of their diverse styles, usability, and brand mark of each company (Denision & Cawthray, 2015). More importantly, they cause less environmental pollution than plastic bags do. Although the development of plastic bags provide convenience, it a disaster for the earth in the near future. Thus, recently, Vietnamese enterprises have begun focusing on the use of paper bags instead of plastic bags. As a result, the use of paper bags instead of plastic bags for packing foodstuffs of Phu Binh An company also follows this trend. Therefore, in my opinion, this plan is very necessary because of its benefits to the environment and community. Below is the business plan for the paper bag prducts of Phu Binh An Co., Ltd.
2. Marketing strategy
Phu Binh An Co., Ltd is a company specializing in providing large quantities in the foodstuff supply service, so the target market of this company only includes the organizations, not individuals. Specially, the target market of Phu Binh An are companies, factories, offices, hotels, schools, supermarkets, restaurants, vegetable shops,… in Binh Duong. These are organizations having demand for fresh foodstuffs provided by the company. With specific characteristics of this target market, the paper bags produced by Phu Binh An should have diverse sizes, high durability and utility to users. For example, with the target customers like companies, factories, offices, hotels, schools, restaurants, the company can can design the paper bags with large size and durability to be able to sustain large volumes of foodstuffs. Meanwhile, for supermarkets and vegetable shops, the company should have paper bags with a smaller size in order to stimulate users to reuse them.
Market size and trends:
According to Dao (2005), Binh Duong is a bright spot on the economic map of Vietnam with the achievements of innovation and international economic integration. First of all, the province has outstanding results in attracting direct investment from abroad. Therefore, Binh Duong is a province having large number of companies, offices, restaurants, schools,… which are target customers of Phu Binh An in foodstuff supply service. At the same time, it also creates the big market size for this company. In addition, the needs of customers and the speed of growth in this service are always stable and tend to increase due to the increase of the number of workers / employees / students in Binh Duong in general and the industrial zones in particular in the province over the years. Thus, the trend using foodstuff supply service is also rise up in this area, facilitating for the development of this service of the company. Thus, the plans producing paper bags for packaging foodstuffs of Phu Binh An will have the opportunity to achieve a higher success rate.
Due to attractive market, there are many different companies operating in supplying foodstuffs in Binh Duong like Phu Binh An. The major competitors of the company are: Viet Kitchen Fire Co., Huy Phuoc, Thien Phuc Hieu, Huong Viet, Hoang Hai Co. and a lot of other companies. Therefore, the intensity of competition in the industry is very large. As a results, Phu Binh An needs to have suitable and effective business strategy in order to compete with other competitors. And one of competitive weapons of Phu Binh An is CSR activities, including the manufacture of paper bags for packing foodstuffs. Currently, the competitors of Phu Binh An still use mostly plastic bags for packing foodstuffs because of the convenience and low cost.
In fact, plastic bags have become familiar in everyday life of people. However, the impact of plastic bags on the environment and human health are enormous. According to the Ministry of Natural Resources and Environment, Vietnam releases about 2,500 tons plastic garbage into the environment everyday. Especially, after using, plastic garbage takes from 500 years to 1,000 years to decompose; if buried, plastic bags affect the water environment, and if burned, they will create toxic emissions causing illness (Thanhniennews.com, 2011). Moreover, the use of plastic bags to package foodstuffs is also dangerous, making food contaminated with metals from plastic. Even worse, there are many kinds of poor quality plastic recycled from medical waste that is a source of infectious diseases for the users.
Being keenly aware of the problems mentioned above, Phu Binh An will perform the business plan with using paper bags instead of plastic bags for foodstuff packaging in order to ensure consumer health, enhance environmental protection, and effectively compete with other rivals in the market.
Estimated market share:
Currently, the foodstuff supply service is not the strength of Phu Binh An companys, so the market share in the service of the company is relatively small, only 4% (Phu Binh An, 2015). However, as expected, with the plan using paper bags for packaging foodstuffs, Phu Binh An will quickly gain the trust and love of customers. Because, if the customers have a choice between paper and plastic bags, they will definitely choose paper bags. This bag not only replaces other types of bags, but also impress customers, and advertise for the brand thanks to the variety of designs, paper materials and printing techniques. Therefore, it’s sure that the market share in the foodstuff supply service of the company will increase. Specifically, this service is expected to account for 15% of this market in Binh Duong within next 3 years.
Description on marketing mix:
This business plan is to focuses on the paper bag used to package the foodstuffs supplied by Phu Binh An Co., Ltd. Therefore, the marketing mix plan below refers directly to this product:
• Product Strategy:
Before conducting the official production of the paper bags, Phu Binh An needs to focus on R&D in order to research, innovate, select and design the styles, sizes, materials and colors matching with each target market. Currently, on the market, there are many types of paper used to make paper bags as Kraft, Duplex, Couche, Ford, Ivory, Bristol,… with different features. Therefore, to suit the purpose that is to package foodstuffs, Phu Binh An can use Kraft, Duplex or Couche paper. Among them, Kraft paper is often used by the uniqueness and high usability, so the company can use this paper to produce paper bags with large size. Meanwhile, the Duplex paper only has a glossy face with cheap price. And Couche paper, which is glossy in both sides, has high endurance, smoothness, beautiful color, diverse printing methods (Pipes, 2005). Therefore, Phu Binh An can use two types of paper to produce the paper bag with small size and luxury.
Besides, on each company’s paper bag, logo, slogan and address should be used offset printing technique in order to promote and stimulate the customers to remember its brand. Furthermore, with the papaer bag having big size, Phu Binh An can create more in order to make them become more attractive and stimulate users to reuse through interesting motifs, illustrations relating to products, services or the company.
• Pricing strategy:
Because this is a plan that is conducted for the benefit of the community demonstrates the social responsibility of Phu Binh An, the paper bags produced by the company will be free to all customers. The company only calculates the value of the foodstuffs contained in the paper bag to offer the prices that customers have to pay. I believe that with the increasing number of customers in the near future, the company’s profits are still assured though paper bags are distributed for free. Therefore, in the pricing strategy, with the paper bag products, the company does not need to perform any activity.
• Place (Distribution) strategy:
As mentioned above, the paper bags that are used to package foodstuffs are distributed free to all customers, but Phu Binh An still needs to expand and diversify distribution channel of this product:
Distribution via the Internet:
The company should establish and strengthen distribution channels over the Internet by online ordering service, because in Vietnam today, the online buying has become more and more popular. This has many advantages because it helps the company quickly update changes in products and services, and provide sufficient information for customers. Accordingly, all customers ordering foodstuffs online can receive the paper bags like customers ordering directly at the company. Additionally, the images of the eye-catching and useful paper bags are also shown on the website and the other ordering pages.
Distribution through intermediaries:
Strengthen cooperation with schools, hospitals, travel companies, tour operators, enterprises,… in local and even across the country to create more sources of new customers in order to facilitate the foodstuffs and paper bags of the company in reaching numerous target customers, thereby enhancing the brand and increasing the revenues of the company.
Distribution through sales staffs of the company:
Enhance the necessary skills for employees, especially sales staffs with the soft skills, such as communication, persuasion,… because they directly contact with customers and use their skills to persuade customers using the services of the company. The sales staffs of Phu Binh An can meet and introduce directly to customers about paper bag products of the company, especailly emphasize the advantages of these products and their benefits in order to attract them.