Ready business plan creative office extraordinary congratulations in Berlin

1. PROJECT SUMMARY
The aim of the project is to organize a creative Bureau of unusual greetings in Berlin. The Bureau provides diverse services for the development and implementation of unusual greetings to order. Used both online and offline channels.

The idea and business model are original. To date, there are no such projects on the European market, which allows to ensure high competitiveness of the project. An additional advantage is the absence of the need to employ a large number of employees – on a permanent basis, the project employs a minimum of staff, the rest of the employees are involved as required as freelance employees or freelancers.

Investment costs are aimed at the acquisition of the necessary equipment, development and promotion of the website, as well as the formation of the working capital Fund before the project comes to payback.

Table 1. Project performance indicators

Payback period (PP), months.

Six

Discounted payback period (DPP), months

Six

Net present value (NPV), Euro

467 430

Return on investment (ARR) ratio), %

36,78%

Internal rate of return (IRR), %

Of 21.70%


The profitability index (PI)

Of 1.88


2. DESCRIPTION OF THE COMPANY AND THE INDUSTRY
The aim of the project is to organize a creative Agency of unusual congratulations in Yekaterinburg. Project services are implemented through the Agency's website and are classified as paid services purchased through the Internet.

The market for Internet Commerce in Europe is being actively developed. The network sells not only goods but also all kinds of services. One of the main drivers of this industry is the spread of broadband access to the Internet, as well as the development of web programming technologies, which together allow users to get the most complete and quick access to a variety of different products and services. The user can not only see the description of the service, read reviews about the company, but also compare prices and range of services with other companies.

As for the number of Internet users, Europe today is slightly behind many developed countries – the number of Internet users in our country is about 71% of the total economically active population. For comparison, in Australia this figure is at 92%, and in the UK, Germany, France, USA – at more than 80%. However, every year this gap is reduced, which has a positive impact on the volume of Internet trade. However, this is not the only driver of growth in this segment.

Figure 1. Internet penetration in some countries, % of the population, June 2016 (according to Internetworldstats.com)

 Ready business plan creative office extraordinary congratulations
Figure 2. Structure of Internet users by type of settlements, 2015, % (according to FOM)

 Ready business plan creative office extraordinary congratulations
The main driver of e-Commerce is the product segment, which accounts for 84.5% of total sales. Paid services account for only 12.2% of sales. It should also be noted that the segment of paid services is developing much slower than the commodity segment. According to experts, its volume in 2015 amounted to 112.6 billion euros; in 2014-113.7 billion euros Thus, for the year the volume of the segment decreased by 0.9% against 3.3% growth of the commodity segment.

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The most capacious segment of the sale of services through the Internet-a variety of travel services: the purchase of package tours, hotel reservations. However, this segment has reduced its volumes from the 28.4 to 19.5 billion euros the Reason for the decrease in solvency of the population; people have less to spend on recreation.

Growth in 2015 was shown by such segments as online television, purchase of movies and music, Dating sites, online games and so on. This is also due to the reformatting of the rest of the Russians, who began to spend more time at home, choosing more affordable entertainment.

Figure 3. Structure of the Russian market of Internet trade paid services in 2015, billion euros (according to RBC RESEARCH)

Ready business plan creative office extraordinary congratulations
As of 2015, the bulk of the market for paid services was concentrated in Moscow and the Moscow region, which accounted for slightly less than 50% of the market. The share of St. Petersburg-10%, other cities-millionaires (collectively) – 13%.

Figure 4. Geographical structure of the market the Internet-trade paid services in 2015, % (according to RBC RESEARCH)

Ready business plan creative office extraordinary congratulations 
Today in Europe, according to experts, about 17.7 million Internet buyers (in cities with a population of 100,000 people aged 18-54 years).

Figure 5. The number of customers of paid services via the Internet 2015 (according to RBC RESEARCH)

Ready business plan creative office extraordinary congratulations

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According to surveys, the majority of Russian Internet users (78%) made their last purchase via the Internet no more than six months ago, which indicates a high activity of the population in this segment.

The most active buyers live in Moscow and Moscow region. It is interesting that residents of small towns (from 100 to 500 thousand people) use the services of online stores much more often than residents of larger cities. This is due to the low availability of goods and services in physical stores and service industries. 40% of the surveyed users say that their spending on online purchases has decreased, 24% - that costs have not changed, and 22% - that increased.

According to gender, the most active users are women-they make purchases through the Internet much more often than men. By age, the most active buyers are users over the age of 35. Users between the ages of 18 and 24 years, on the contrary, usually made purchases over the Internet more than a year ago, due to their unstable income.

In addition to the above, against the background of reduced solvency, the Russians seek to reduce the cost of buying gifts, compensating for their cost of originality and creativity. All of these factors significantly increase the competitiveness of the project.

3. DESCRIPTION OF GOODS AND SERVICES
The project provides online and offline services for the development and implementation of original greetings. The list of services and their description are given in Table. 2.


To date, only event agencies are present among the close analogues of the project, which are engaged in the organization of events, but do not provide additional services provided by the project. In addition, existing event-agencies have such disadvantages as: banal and vulgar scenarios, relatively high prices, the lack of guarantees of high results.

4. SALES AND MARKETING
The target audience – men and women aged 18 to 45 years, active Internet users, low-and middle-income, with a sense of humor. The main channel of promotion is the Internet.

Use contextual advertising in search systems Yandex and Google. Analysis of search queries shows the following. Wordstat by Yandex:

"unusual greeting" - 12 663 shows per month

"unusual gifts" - 47 920 shows

"original gifts" - 135 037 shows

"original greetings" - 77 776 screenings

Figure 6. Dynamics of "unusual gifts" requests according to Google Trends, 2011-2016

 Ready business plan creative office extraordinary congratulations

Figure 7. Dynamics of "unusual greetings" requests according to Google Trends, 2011-2016

 Ready business plan creative office extraordinary congratulations
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Figure 8. Seasonal fluctuations in the popularity of the request "unusual greetings", November 2015-November 2016

Ready business plan creative office extraordinary congratulations

As can be seen from the above figures, the popularity of the relevant queries remains almost unchanged, there is a pronounced local seasonality. Peaks occur on new Year holidays, and also on March 8. The influence of seasonality is taken into account in the preparation of the financial plan.

Also to promote the services of the project uses social network: vk.com, ok.ru, Instagram. Thematic groups and public pages are created in the networks. As promotion tools are used: targeted advertising, paid promotion of publications, paid placement of publications in other groups in which the target audience of the project is present.


5. PRODUCTION PLAN
The implementation of the project begins with the development of the project website. Works on its creation are carried out by a web Studio in Yekaterinburg. The contractor also performs work on the initial promotion of the site.

Full-time employees of the project work on writing texts, design and General organization of events. All additional functions are performed by contractors: actors, parodists, musicians and so on.

6. ORGANIZATIONAL PLAN
The project involves the use of a minimum number of full-time employees. In fact, when organizing events, the Agency performs the function of a contractor, involving subcontractors for the performance of certain functions.

The initiator of the project is supposed to be self-employed. It performs all administrative, managerial and organizational functions. Also in the project are part-time designer and content Manager. Accounting is outsourced.

The initiator establishes partnerships with specialists from various professional fields who can be involved in the project as subcontractors.


7. FINANCIAL PLAN
The financial plan is designed for a period of five years and takes into account all revenues and expenses of the project. Income is defined as revenue from operating activities; income from investing activities and disposal of assets is not provided for. Revenue of the first year of the project-2,4 million euros, net profit (after tax) - 795,7 thousand euros Revenue of the second year and subsequent years-3,0 million euros, net profit-1,16 million euros

The investment cost of the project is 249 000 euros, the main part of the funds is spent on the development and promotion of the site, as well as on the purchase of professional design software and equipment for printing. The investment costs also include the costs of the formation of the working capital Fund before the project comes to payback. All costs are covered from the project initiator's own funds.



Variable costs include the cost of purchasing the necessary materials (printing paper, ink, etc.), as well as the fees of the subcontractors involved (Table. 6). Fixed costs include site support, advertising and depreciation (Table. 7). The amount of depreciation is determined on a straight-line basis, based on the useful life of five years.
A detailed financial plan of the project is given in the Annex. 1.



8. EFFICIENCY EVALUATION
Evaluation of the project effectiveness is based on a detailed analysis of the financial plan, cash flows, as well as simple and integral indicators of the project (Table. 1).

To account for changes in the value of money over time, the method of discounting cash flows is used. Discount rate-10%.

Simple (PP) and discounted (DPP) project payback period – 6 months. Net present value (NPV) – 467 430 euros, which is not only a positive value, but also exceeds the amount of investment costs. The internal rate of return (IRR) is 21.7%, which is higher than the average Bank rate on loans, as well as higher than the inflation rate in the country. The yield index (PI) is 1.88, which is significantly more than 1.

All these indicators show high efficiency and investment attractiveness of the project.

9. GUARANTEES AND RISKS
The main risk for the project is the probability of new market players copying the business model of the project. The probability of this is quite high. To neutralize this threat in the shortest possible time it is necessary to establish partnerships with subcontractors, focused on long-term cooperation, as well as to form a pool of loyal customers.


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