BUSINESS PLAN: COUNTY PARK LOUNGE
Business Overview
County Park Lounge will be a night club that will focus on attracting different customers from Davenport, Lowa, particularly students from Kaplan University. It is factual that the population of the students has been growing rapidly in the area reaching up to more than 10% annually. There are approximately 10 night clubs located in Davenport which have been thriving and performing well for the past decade. These night clubs include Connections Nightclub, 1 Hundred West, Carriage Haus, Shenanigan’s Irish Pub and Joes Club among others. County Park Lounge will offer a unique experience to the target customers by presenting an elevated energy dance-theme setting that will cater the needs of the college students while in the club. This will be strategically placed in the central location of the club and reinforced with unique décor and wide selection of disco lights to increase the competitive advantage of the club.
Additionally, the club will focus on unique energy themes, wine, liquor, beer and mixed drinks which will enhance the uniqueness of the club. Other products that will be offered in the club will include nonalcoholic beverages, casual foods such as appetizers and soft drinks. The operational hours of the club in the first fiscal year will be 5:30 P.M to 3:00 A.M in four nights weekly. However, regardless of the fact that the club will be established primarily to attract the college students, County Park Lounge will offer accommodation services for the visitors and guests from outside Davenport or even out of the state. Citing from the target market of County Park, the major market segments will include college women and men where the greatest concern shift to the side of the college women who appear to be get more entertained in night clubs than college men. This is intended to enhance the uniqueness of the club since none of the local nightclubs seem to create a supportive environment for this specific target group. Thus, this will help the club attract more customers within the target market.
Target market segmentation
The projected sales in the first three years of operation are projected to increase with not less than 6% which will also be reflected in the net profit. The sales are represented as below;
The startup cost of the club is approximated to be $35,000 where assets take approximately $14,0000, expenses add up to $16,000 and the remaining $5,000 is for any other expenditure. The capital will be obtained from personal savings and a business loan of $25,000.
Mission
To enhance customer relations by promoting uniqueness in products and services offered in a supportive environment
Vision
To become the dominating nightclub in Davenport and the surrounding in offering unique and quality services to college students from different universities in the area
As Verreynne and Meyer (2010) assert, the competitive advantage of small firms is enhanced by identifying some of the factors that affect the success of the firm. Therefore, the mission and vision of County Park Lounge are based on understanding the core market segment. This means that understanding the demands of the college students with regard to entertainment products and services will be the major determinant of the club’s success.
Keys to Success
- Offer unique products and services that fit the demands of the customers
- Quality and consistent entertainment for the customers
- Effective management of internal and external flow of finances
- Maintenance of foods and drinks costs below 20% of their revenue
The Management Structure
The management structure of County Park Lounge will start with the club manager, who will be followed by at least five bartenders, three cooks, DJ, cleaning and serving staff. As aforementioned, one of the keys to success for this club is management of internal and external finances flow. As a result, the club will employ an accountant to make sure that cash flow is effectively and appropriately recorded in the financial statements. In this case, I will be the club manager as the owner of the business in order to supervise the daily operation of the club and engage in the hiring process. I want to be on the full control of the business with regard to the hiring and training of the staff, deciding the appropriate business strategy to implement, and making sure that the business is complying with applicable laws and regulations. As Verreynne and Meyer (2010) states, I want to be in a participative strategy-making. The significance of this type of strategy-making is that it is effective in implementing emergent strategies since it does not demand for a formal process such as dialogue or consultation. Additionally, as a manager, I will pay more attention on the finances flow to make sure that every penny is accounted for appropriately. Generally, I will be able to supervise and follow the progress of the business and note any fault that might materialize. This means that the club will run effectively as the management will be at my hands and according to my wish with regard to the objective that I projected while starting up the club.
DISCUSSION: BUSINESS STRATEGY
According to Verreynne and Meyer (2010), it is factual that if small firms engage outsiders in their planning process, they enhance their performance. Thus, one of the critical errors that Clean-Air Carpet Cleaning Company made in their planning phase is failure to involve outsiders; particularly who have experience in the market. This yielded to the mistake of offering their services at 20% lower price from that of their competitors. They did not assess whether the business will perform effectively with that price discount under the partnership of three members. The other fault is that as the business continued to encroach in the market, Clean-Air Carpet Cleaning Company failed to increase the number of employees in order to cater for the market demand and changes. According to Uggla and Filipsson (2009), the objective of a business strategy is to deliver a solution that will correspond to the demands of the target market segment. Thus, it can be asserted that Clean-Air Carpet Cleaning Company employed business strategy partially.
Some of the economic factors that Clean-Air Carpet Cleaning Company could have included in their plans include increasing production (number of employees), integration, and new market venture. Citing from the increase of market demand, increasing number of employees would have helped the organization serve the market effectively. Additionally, integration with other related business would have made sure that the company serves it potential customers maximally. Lastly, making a new venture such as retailing would create more opportunities for the business in order to circumvent dissolution of the business after one fiscal year.
Some of the operational improvements that I would suggest for the company include integration, increasing the number of employees, specifying the operational days (5 days in a week) and advancing and extending their service and product line.
The contributing factors of failure for Clean-Air Carpet Cleaning Company include poor planning, failure to increase their production output regardless of market changes, lack of formal management and improvement strategies, poor organizational structure, and poor financial accounting.
CLASSMATE DISCUSSION
Response to Staci
It is factual that one of the critical errors that Clean-Air Carpet Cleaning Company made was to lower their prices below their breakeven level. This made had for them to invest in more manpower when the business was experiencing high demands in the market. On the other hand, regarding the economic factors that the company should have considered, targeting retail business together with commercial spaces was recommendable. Therefore, the company could have focused on business and commercial property in order to improve their operation to serve the potential customers. This derives the factors that contributed to the failure of the company such as failure to expand the product line, poor planning and ineffective business strategy.
Response to John
It is true that some of the errors that Clean-Air Carpet Cleaning Company made include poor budgeting, poor marketing plan and weak startup. This includes offering their prices at 20% below the price of their competitors which was far below their breakeven level. Thus, one of the economic factors that the organization could have considered include purchasing additional equipments as an approach of increasing their output to sustain the demands in the market. Lastly, the contributing factors of failure of this company can be poor budgeting, ineffective organizational structure, and poor planning.
References
Uggla, H., & Filipsson, D. (2009). Business and brand strategy: A framework for integration. ICFAI Journal of Business Strategy, 6(2), 27-42.
Verreynne, M., & Meyer, D. (2010). Small business strategy and the industry life cycle. Small Business Economics, 35(4), 399-416.
http://extmedia.kaplan.edu/business/MT499/Unit_1/index.html
