Business_Plan_Online

Business Plan

BUSA 2205 - Entrepreneurial Management

Instructor: Edith Kirkpatrick

By

Anya Ustinova

Pauline Chu

Viktor Klein

Max Liu

Business PlanBUSA 2205 - Entrepreneurial ManagementNovember 30, 2015

ContentsExecutive Summary.....................................................................................................................................3

Management Team.....................................................................................................................................4

Business Objectives.....................................................................................................................................5

Vision Statement.........................................................................................................................................5

Mission Statement......................................................................................................................................5

Marketing approach....................................................................................................................................5

Target Market:.............................................................................................................................................6

Strategy:......................................................................................................................................................6

Tactics:.........................................................................................................................................................6

SWOT:..........................................................................................................................................................7

Evaluation:...................................................................................................................................................7

Location / Facilities......................................................................................................................................8

Financing...................................................................................................................................................11

Feasibility Analysis.................................................................................................................................11

Projected Income..................................................................................................................................12

Revenue Model.....................................................................................................................................12

Financial requirements..........................................................................................................................13

Sources of Financing..............................................................................................................................15

Debt Ratio..............................................................................................................................................16

Bookkeeping/Accounting system..........................................................................................................16

Personnel:.................................................................................................................................................16

Form of ownership:...............................................................................................................................16

Insurance:..............................................................................................................................................18

Insurance:..................................................................................................................................................19

Legal requirements....................................................................................................................................19

Professional and Advisory Support............................................................................................................19

Risk Assessment........................................................................................................................................19

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Executive Summary

Started by 4 motivated young entrepreneurs in Sept 2015, BarkandMeow.ca is an online

platform that connects pet owners with local pet businesses in the Greater Vancouver area.

This focused platform allows users to easily search, book and review services for their pets

and creates a community of trust. The business idea was inspired from the frustration

experienced by Pauline when she could not find any reviews on dog trainers on Yelp when

she wanted to send her dog to a trainer. After doing some research, she realizes that the

pet business industry is huge and growing in Canada but there are many gaps to be filled in

bringing pet owners and pet businesses together. The current Management Team is

consisted of 4 UBC graduates with strong expertise in Finance, Technology, PR, and Legal.

They are all pet lovers who like to help their community while making their company

profitable.

After 3 months of startup operations, BarkandMeow.ca is ready for expansion. We will have

2 new hires in Marketing and 1 new hire in Technology departments join us in December

and help us expand sales and launch a Mobile app at the same time. We have secured

government loans from Futurpreneur and BDC starting December to help fund this

investment, but to keep our Debt Ratio low we are seeking equity investment from Angel

investors for $35,000 in exchange for 25% equity in our business. We expect to be

profitable before the end of 2016, and plan to grow our business by double-digits in the

years beyond. We are confident our investors will realize an excellent ROI within the next

5 years.

Management TeamPauline Chu:

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President/Co-founder/Director of Financing and AccountingPauline has a 4 year old dog (Tia) and a 4 year old cat (Smokie)Bachelor of Commerce (UBC), CPA.Previously Financial officer for Move, Inc. and brings 6 years of consumer market and public company experience from Yelp.

Victor Klein:

Co-founder/Director of Operations and Technology. He is a Pets lover. Bachelor of Computer Science (UBC)3 years Industry experience as Operating Officer

Anya Ustinova:

Co-founder/Director of Sales and MarketingPet loverBachelor of Public Relations (UBC)6 years experience as senior sales roles in Ebay, and she was responsible for leading the rapidly growing sales, client services, and revenue operations groups for many years.

Shijun Liu:

Co-founder/Director of HR and LegalPets loverJuris Doctor (UBC)5 years of experience as running the legal and business development teams at Xoom Corporation, an online money transfer company

Business Objectives

Reach profitability within the first year

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10% market share by December 2016 Reach 50.000 subscribers by December 2016 Be seen as a recognized and trustworthy platform for potential customers that

provides variety of different services Attract local businesses to our website as a way that helps businesses to increase

their brand awareness and promote their product or services Get people to purchase product or services through our website

Vision StatementTo be the prime online destination for all your pet’s needs.

Mission StatementWe connect pet lovers with local businesses through online platform for searching, booking and reviewing services. Our love for animals drives us to help you find the best services for your pet.

Marketing approach After the research we are focusing on 2 target market groups, local businesses and current or potential pet owners. Here are some facts that we took under consideration while creating a marketing plan. 56% of Canadian households have at least one dog or cat. 40% of Canadians are going “online” to find information about pet care and pet services. Television and radio, pamphlets and brochures, magazines and newspapers were also identified as important.Marketing Objectives:•Create a positive experience for local businesses and potential customers through the website•Be seen as a recognized and trustworthy platform for potential customers that provides variety of different services •Attract local businesses to our website as a way that helps businesses to increase their brand awareness and promote their product or services•Get people to purchase product or services through our website

Target Market:

• Current pet owners

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• Potential pet ownerso Living in Great Vancouver areao 25-65 year old o 25.000$+ annual income

• Local businesses o Vet clinicso Pet boardingo Pet daycareo Pet groomingo Dog trainerso Pet storeso Shelters

Strategy: To increase traffic to our website we will be advertising it through social media platform (Facebook, Instagram), pet related websites and out of home ads (buses, billboards). We are going to use humoristic photos of cats and dogs to attract attention of more people. Increase traffic to our website through advertising in social media platforms. Use of direct sales to introduce our platform to local businesses and potential customers.

Tactics:• Create Facebook, Instagram, Web paid ad, targeting people who most likely to be interested in our website (people who have pets). The ad will have a funny pet photo that will have a phrase on it (key message) call to action and link to our web site. (Example below)• For the out of home advertising we are using the same idea of funny photos of animals. Billboards and buses are very effective in order to reach our target market. • Social media campaign that will offer to entera contest to the first 100 people who uses our online services. The winner gets a 1000$ certificate to spend on his furry friend.

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SWOT:

Social media ad: Out of home ad:

Evaluation:We are going to use Google Analytics tools to track and measure how much traffic we have on our website, how many people are “liking“us, where people are coming from (Fb,Instagram or other websites).We are going to measure how many people who visited us subscribed, shared or commented. Each visitor will be offered to fill out a feedback

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Location / FacilitiesPersonal Living Location:PaulineMaxAnyaViktor

General Infrastructure:Metro systemAirports

Location conclusion

Central Vancouver (near Central Station) South and proximity to Downtown Close to Transportation systems / Cheaper Rent Most convenient Compromise solution for team

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Facility Concept

Facility Coststotal

qnt. pr. once a. month. annual.Facility500sqft. Apartment (rent utilities included) $1.000Office Furniture and EquipmentDesk 1 200 $200Comfortable chair 4 50 $200File cabinets 5 40 $200Overhead and work lighting 4 40 $160Desktop and pocket calculators 4 2 $8Office decorations $200Labeling machine 1 40 $40Paper shredder 1 60 $60Wifi Copier/Scanner 1 320 $320

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Wastebasket 2 15 $30Recycling bin 1 15 $15Fire extinguisher 1 60 $60First-aid kit 1 20 $20Clock 2 10 $20Calender 1 10 $10Computer Hardware and Accessories qnt. pr. once a. mnth. anual.Desktop computer and monitor (incl. Mouse and keyboard) (incl. MS Office) 4 450 $1.800Computer locks 4 10 $40Computer SoftwareVirus protection software 4 $60Quickbooks (Payments, Accounting) 1 $500CommunicationsLandline Office Phone 1 $40Mobile Phones 3 60 $180Internet connection (500GB Data Internet Volume Pack from Telus 65$/Month) 1 $70Domain - .com Domain costs 12$ annually 1 $12Hosting - for Domain 200GB traffic 1 $15General Office SuppliesStationery $40Printer cartridges $20Printer paper (500x) (purchase all 2 Months) 12 $6Cleaning supplies 20 $20Flipcharts 1 $30Whiteboard 1 $40Supplies for shipping & mailing $30

Total onetime aqnt. $4.043Total Monthly $1.331Total Anually $72

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Financing

Feasibility Analysis

Target Market and Trade Area

BarkandMeow.ca has 2 target markets: Pet Owners in the Greater Vancouver area, and Pet Businesses in the same local area.

Local Pet Businesses are our Primary customer, since they have to pay a subscription fee to be featured on our web portal.

Local Pet Owners are our Secondary customer, since booking fee revenues are generated when pet owners make bookings through our web portal.

The Greater Vancouver Regional District (GVRD) consists of 21 municipalities, starting from Bowen Island/West Vancouver to the West, Maple Ridge/Langley to the East, West Vancouver/North Vancouver to the North, and White Rock to the South.

Source: http://www.metrovancouver.org/about/Pages/default.aspx

There are 5 major categories of Local Pet Businesses included in our target market:o Veterinarian hospitals/clinicso Dog Trainerso Pet Boarding/Kennelso Daycare/Pet sitting serviceso Grooming, bath, nail clipping services

Although there are many pet food and supplies stores, if they do not offer any type of service that can be booked, they are excluded from this analysis.

Market Potential

There are 2.28 million households living in the GVRD. Of this population, 57% own pets, i.e.1.3 million households fall into our target

market of Vancouver Pet Lovers. Of this market, at least 40% look for pet services online, which puts the market

potential at 520,000 households. The percentage of people searching for pet services online is expected to grow rapidly as Canadians become increasingly technology-savvy and mobile-centric.

Below details the market potential of Local Pet Businesses:

Categories # in GVRD Avg $/booking Bookings/month Market potential $

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Vet clinics 230 350 60 4,830,000

Dog Trainers 34 200 12 81,600

Boarding 52 200 20 208,000

Daycare/Pet sitting 110 30 80 264,000

Groomers 158 30 40 189,600

TOTAL $5,573,200

Market Share

Yelp current holds about 1.3% of the mobile search market. There is currently no comparable competitor other than Yelp. We estimate to be able to capture 1% of market share in all Pet Business categories

in the beginning, and the market share would be easy to increase with good marketing efforts and timely launch of the BarkandMeow.ca app.

Projected Income The Projected Income Statement was prepared on 2015/11/30 with actual financial

data for 2015/9/30-2015/11/30, and projected financial data for the next 12 months. See Exhibit A.

We expect the business to be profitable within 11 months (by Oct 2016).

Revenue Model Local Pet Businesses have 2 options for a Subscription Agreement to list with us.

o Six-month agreement: first month free, 2nd-3rd month $35/month, rest of year $55/month

o One-year agreement: first month free, 2nd-3rd month $30/month, rest of year $50/month

For each booking successfully obtained through our portal, we charge a Booking Fee: 3% of booking value, min. $1

Categories Market potential

Initial market share

Initial monthly booking

Booking fee Revenue

6 month contract monthly revenue

1 yr contract monthly

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revenue

Vet clinics 4,830,000 1% 48,300 1449 40.25 34.5

Dog Trainers 81,600 1% 816 24.48 5.95 5.1

Boarding 208,000 1% 2,080 62.4 9.1 7.8

Daycare/Pet sitting 264,000 1% 2,640 79.2 19.25 16.5

Groomers 189,600 1% 1,896 56.88 27.65 23.7

Total 1671.96 204.4 87.6

Subscription fees are payable at beginning of the month; Booking fees are billed at the end of the month.

For the purpose of the income projection, we estimate a 50/50 split between 6-month contracts and 1-year contracts.

Financial requirementsStart-up Costs are as follows:

Facilities

Home Office Rent (incl. utilities) 1,000

Furniture 600

Light fixtures 160

Décor 200

Office electronics 108

Cordless phone system 100

Stationery 100

Supplies - office 115

Supplies - cleaning 20

Safety/First Aid supplies 80

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Desktop computer & monitor 1,800

Copier/Scanner 320

Computer software 560

Computer accessories 40

Printing supplies 32

Business cards for Execs 20

Technology

Telephone plan 25

Mobile phone plan 90

Internet service provider 70

Domain name (.ca) 12

Website hosting 15

Marketing and Sales

Business cards for Sales 300

Internet/social media advertising 400

Bus shelters 3,000

Billboards 16,000

Human Resources

Wages 0

Commissions on Subscription 0

CPP 0

EI 0

Workers Comp Insurance 1,400

Gen. Liab. Insurance 400

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Business owner Insurance 2,800

Legal

Business License 53

Trademark fee 300

TOTAL START-UP COSTS $30,120

Other than Rent, most of the ongoing operating costs are for Technology, Marketing, and Human Resources.

See Exhibit B for the Projected Cashflow Statement for the next 12 months, including actual cashflows from inception to 2015/11/30.

Sources of Financing BarkandMeow.ca requires $140,000 to fund the business’ start-up and first year of

operations. Each Co-founder has invested $15,000 of their personal funds into the business. Since all 4 Co-founders are under 35, they qualify for two government financing

programs: Futurpreneur and Business Development Bank of Canada (BDC). We have already received approvals from Futurpreneur for $15,000 and from BDC

for $30,000, and the loans will disburse tomorrow on 2015/12/1. We are seeking a $35,000 equity investment from Angel investors in exchange

for 25% equity to begin in December, which would allow us to maintain a healthy cashflow while increasing spending in the areas of Sales & Marketing and Technology.

Owners’ investment 60,000

Angel Equity investment** 35,000

Futurpreneur loan 15,000

BDC loan 30,000

Total Funds 140,000

**Anticipated to receive by Dec 2015

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Debt RatioOur Debt Ratio is very healthy, as seen below:

Total Debt: $45,000Owner’s Equity (current): $60,000Debt-to-Equity ratio (current) = 0.75Owner’s Equity (with Angel investment): $95,000Debt-to-Equity ratio (with Angel investment) = 0.47

Bookkeeping/Accounting system Pauline, the President of the company, temporarily assumes the role of Director of

Finance & Accounting and will be handling the accounting in the first year of the business using the software Quickbooks Desktop, which costs $500 for 1 user.

To ensure checks and balances are in place, she will consult with an external Certified General Accountant (CGA) for semi-annual and annual reviews and audits of all financial statements.

The business will engage in an Executive Search for a permanent Director of Finance & Accounting for the beginning of 2017.

Credit Policy: Local Pet Businesses have the option to pay by Credit Card (Visa or MasterCard), PayPal or by Pre-Authorized Debit of their bank account. Bills are due within 15 days from invoice date.

Personnel:

Form of ownership: General PartnershipIdentification of partners:Pauline Chu, Viktor Klein, Anya Ustinova , Shijun LiuRoles and Benefits:

President: Creating, communicating, and implementing the organization's vision, mission, and

overall direction. Leading, guiding, directing, and evaluating the work of other executive leaders Formulating and implementing the strategic plan that guides the direction of the

business

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Forming, staffing, guiding, leading, and managing an organization sufficient to accomplish the president's responsibilities and the strategic plan of the business.

Overseeing the complete operation of an organization in accordance with the direction established in the strategic plans

Director of Finance and Accounting: presenting and reporting accurate and timely historical financial information of the

company oversees the capital structure of the company, determining the best mix of debt,

equity and internal financing, decide how to invest the company's money, taking into consideration risk and liquidity

identify and report what areas of a company are most efficient and how the company can capitalize on this information

Director of HR and Legal: places advertisements for new employees and may attend job fairs and handle other

recruiting duties tracking vacation time and pay, maintaining a holiday schedule, creating policies on

flexible work hours and updating records when employees are promoted or transfer departments

administering compensation and benefit package coordinate training and mentoring programs to further develop employee skills,

review employee performance legal personality, limited liability, transferable shares, delegated management under

a board structure and investor ownership

Director of Sales and Marketing: leads sales management, product development, distribution channel management,

marketing communications (including advertising and promotions), pricing, market research, and customer service.

In change of sales team Director of Operations and Technology

make sure the technical equipment in the theater is functional, maintained and safe generating necessary working drawings for programming budget estimations and maintaining of accounts scheduling and supervising coordinating put-ins handling conflicts that arise between different departments organizing the strike and clean-up for that production.

Programmer

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build online platform for the company develop applications maintain online service and system

Sales/promoter implement promotional and advertising plan customer service

salary/hr

commission rate

salary/yr CPP(4.95%) EI(2.63%)

President - - - - -

Director of HR and legal - - - - -

Director of Sales and Marketing

- - - - -

Director of Operation and Technology

- - - - -

Sale Professional $15 8% $31,200 $1,544.40 $820.56

Sale CO-OP $11 7% $22,880 $1,132.56 $601.74

Programmer $30 - $62,400 $2,544.30 $1,337.06

(Source: Canada Revenue Agency)

Insurance:General Liability Insurance (Covers slip and fall injuries, advertising slander and libel lawsuits etc.)Premium: $400Coverage: Up to $2 millionDeductible: $0Business Owner Insurance (Policy covers property damage from theft, fire, storm and vandalism) Premium: $700Coverage: Up to $2 millionDeductible: $500Workers Compensation Insurance (Policy covers worker’s injuries)Premium: $1,400Coverage: up to $500,000Deductible: $0

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Insurance:General Liability Insurance (Covers slip and fall injuries, advertising slander and libel lawsuits etc.)Premium: $400Coverage: Up to $2 millionDeductible: $0Business Owner Insurance (Policy covers property damage from theft, fire, storm and vandalism) Premium: $700Coverage: Up to $2 millionDeductible: $500Workers Compensation Insurance (Policy covers worker’s injuries)Premium: $1,400Coverage: up to $500,000Deductible: $0

Legal requirements Business license: register business name as B&M Group, it will cost $53 Trademark: submit request and fee online via Canadian Intellectual Property Office,

it will cost $300 Agreement to Implement Employee Equity Federal Business Registration

Professional and Advisory Support

Insurance agent- Sameer Karim at Mardon InsuranceBanker- Bank of Montreal business servicesConsultant(s) Mentors and key advisors in addition to the above: Small Business BC mentorship program

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Risk Assessment

Description of Risk

Possible Consequences

Prob. of Risk

Severity of Risk

Overall Risk

Contingency Plan

High competition from secondary competitor, like Yelp

Business have difficulty to grow

H H H Focus on building "pets exclusive" platform; increase consumer awareness through extensive Marketing

Sign-up Barrier: People are not willing to adopt the service

Could not get enough online traffic to make business profitable

H H H Optimizing the online system, make the service more effective;

Branding (Features, Advantages, Benefits); Integrate with Facebook or Google login

Target business clients hesitant to subscribe

Could not provide diversified services

H M H Customizing special contracts to major clients;

Advertising the

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bright prospect of online rating/reviewing business

Business will grow fast, services could not match the growth

Could not get customer loyalty and build a good brand image

L M L All departments evaluate business performance bi-weekly, prepare to face large growth and business extension

Lack of capital investment

Business could get through low ebb

M M M Seeking vertical investors;

Focus on major clients

Sources:

http://smallbusiness.costhelper.com/accountants.htmlhttp://futurpreneur.ca/en/get-started/financing-and-mentoring/http://www.ratehub.ca/

http://www.ncbi.nlm.nih.gov/pmc/articles/PMC2603652/

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