Claricent Consultancy Group Assessment - Example

Business Plan for ClARICENT Consultancy Group Name: Tutor: Subject: Date: Table of Contents Executive Summary 3 Objectives 3 Mission Statement 4 Business Model Canvas 4 Customer Segments 4 Value Proposition 4 Customer Relationships 5 Channels 5 Key Activities 6 Project Consulting 6 Market Research 6 Key Resources 6 Key Partnership 6 Cost Structure 7 Market Feasibility 7 Market Segmentation 8 Environmental Factors 8 Target Market Segment Strategy 10 Technical Feasibility 10 Service Business Analysis 10 Business Participants 10 Competition and Buying Patterns 11 Distribution Strategy 12 Management 12 Financial Feasibility 12 References 13 Executive Summary Claricent Consultancy Group CCG is a start-up consultancy company focusing on small and medium-sized businesses in the USA. The founders of the firm are formers marketing professionals who worked for different consulting agencies in the country. The number of new businesses witnessed in the market today is growing. These entrepreneurs have concrete ideas that form the foundation of their new ventures, but at the same time, most of them do not know how to convert the ideas into a reality. In addition, the shortage of talent in the market today makes it difficult for business owners to attract and retain such skills. Therefore, CCG will provide the expertise that these high-tech entrepreneurs need to develop new products and to distribute them into new market segments. Objectives Claricent Consultancy Group has a very minimal capital requirement. Any capital that the firm will acquire will be used to cover basic operational costs and to expand the business. To be successful, the company will require funding for the initial marketing projects and therefore, CCG will be work with a funding company to be successful. Mission Statement The mission for CCG is to offer consulting services to that help their clients make reliable, distinct and substantial improvement in their performance. CCG also believes that success of their clients is their success too. Business Model Canvas Customer Segments Claricent Consultancy Group (CCG) will be dedicated to providing marketing consultation for emerging high-tech manufacturing companies who are looking to maximize their potential of being successful. CCG will work with small to medium sized firms with complex business challenges. It will help these companies to develop practical action plans that will ensure that the business is moving in the right direction. These companies lack internal resources that enable them to efficiently and adequately solve the challenges on their own. Therefore CCG will take advantage of such opportunities by providing marketing skills. Value Proposition Claricent Consultancy Group offers expertise that a high-tech company needs to develop a new product and to enter into a new market. This firm will work by ensuring that there is a combination of staff and independent consultants appropriate for each customer. CCG differentiate itself and bring value to its clients through the following activities: Business process and strategy – CCG help their clients to develop their business and clarify strategies and use those strategies to accomplish their projects or improve the efficiency and effectiveness of their business process. Training – CCG help business and people grow through learning and development. The company brings value to its clients by providing information and guiding them through a process of learning. Efficient in fulfilling promise – CCG is totally confidential and reliable in providing expertise information. Customer Relationships Claricent Consultancy Group intends to establish long-term contracts with emerging high-tech manufacturers as it focuses on customer retention. CCG will also offer cost-effective personal relationships with the customers. A personal relationship with clients will give them comfort which is not available with other consultants. Channels Consultancy services will be distributed through the word of mouth with experience and good customer relationships being the main factors. The company has brand outlets in the major cities, major markets, and through business associations, an industry association, and conferences for executive-level managers. Minimum Viable Product (MVP) Minimum viable product refers to a strategy that a business can use to increase their chances of success. It is a tool used by organizations to convince their customers that they will offer solutions to their problems (Moogk, 2012). In other words, it is a theory about how a company believes it can solve their problems. MVP for CCG is a product video demo showing how CCG looks like. This video is available at company’s website www.claricentconsultancy.com. Clients are advised to watch this video before they make any appointments with CCG. Key Activities Project Consulting Offering project consultancy will be the main activity for CCG. CCG will offer the client a way of harnessing their specific qualities and use of expertise to solve specific problems and develop and implement plans. Market Research Another important activity is market research which is available to specific clients at a specific fee per unit. This research is a complete study of a specific market, topic or channel. For example study of implications of changing margins in software. Key Resources Claricent Consultancy Group has different resources which include physical, intellectual and human. CCG’s physical resources include various outlets in major cities and markets. Intellectual and human resources are the highly professional employees who offer expertise advice to the consultants. Key Partnership Partnership helps to fill gaps that prevent achievement of value propositions. Partnerships also help an organization to achieve economy of scale which reduces costs and optimizes resource use (Wirtz, 2016). CCG can collaborate within consultancy projects, meaning small to medium sized consultancy firms are the key partners. Other key partners are research data repositories. These partners can share and exchange knowledge related to manufacturing and marketing of high-tech products. Revenue Structure Revenue structure describes the flow of revenue into the organization (Wirtz, 2016). A successful business should identify the value proposition that its customers are willing to pay. The main revenue stream for CCG is through leveraging of expertise through project consultation, market research, and published reports. Fees are charged for the services offered. Cost Structure Cost structures examine how the key activities drive the costs being incurred by the organization, and also whether such costs align with the value proposition. Costs can be fixed or variable and cost structure helps to identify the most important cost elements ( Blackwell, 2011). Personnel costs and infrastructure costs are the most significant elements of the cost structure of CCG. These two resources are importance for driving key activities of CCG and therefore the cost structure aligns with the company’s value proposition. Market Feasibility CCG will be focusing on emerging small-medium high-tech manufacturers of technological devices such as computers, laptops, software, and networking services. The most significant and potential customers are executives of medium-sized companies including sales managers, marketing officers, and general managers. They will be charged according to market trends and sometimes according to specific channels. These executives are potential customers for CCG because they do not want to put their money into risk on questionable expertise advice. In addition, they do not want to ruin their brand name and therefore they will look for a company offering highly expertise advice. Market Segmentation Environmental Factors Physical – in the United States, there are new high-tech businesses both small and medium sized being created every day. Therefore the demand for consulting services will be high for these companies. There are also some emerging companies in Latin American and this offers an opportunity for consultation services. Economic- today’s economic conditions continue to be a challenge to the investors particularly on the potential of their returns. Investors are no longer relying on their own ideas to gain reasonable returns. Rather, business owners need to be assured of their profitability before they started reaping the rewards of their hard work. The innovative ideas and leadership qualities that business owners bring need to be combined with other skills from other fields such as marketing. Social – according to U.S Bureau of Labor Statistics (2016), high-tech businesses are growing strongly. These statistics allows start-up business owners to continue pursuing their dreams. Legal – development of Limited Liability Company has made it possible for emerging businesses to organize formal business entities. Limited Liability Company is suitable for small business as they avoid double taxation which is a key characteristic for C corporations. Technological – technological advancement has greatly enhanced the ability for distributed teams to work together on similar projects. Availability of internet enables sharing of information and facilitates communication. Technology will reduce the cost of communication among CCG employees working on different parts of the country. From this analysis, CCG will be focusing to acquire clients from Small to medium manufacturer corporations – this is the most important market segment for CCG. These companies are mainly engaged in manufacturing of software and multimedia products. These companies will be relying on CCG for development functions, market research, and market forums. CCG will offer attractive development options to the company that is facing management challenges and is unable to address market opportunities as they arise. Potential customers Growth Year 1 Year 2 Year 3 Year 4 Year 5 CAGR Small businesses 15% 1000 1150 1323 1521 1749 15.00% Medium business 10% 5000 5500 6050 6655 7321 10.00% Other 2 10,000 10200 10,404 10, 612 10,824 2.00% Total 2.7% 16000 16850 17,985 18,788 19,894 2.7% Target Market Segment Strategy The target market is defined by the customer’s needs that create the market. CCG will be focusing on thousands of well-chosen potential customers in small to medium companies. These thousands of small-medium manufacturers are the key customers of CCG. Technical Feasibility When a business has the required expertise, infrastructure and capital to run the operations then it can be said to be technically and operationally feasible. A startup business such as CCG should consider if there is adequate resources (Number, 2014). Service Business Analysis The consulting industry in the US is growing strongly making it be highly pulverized with thousands of small consulting businesses. These consulting companies include international brands and individual businesses. Business Participants A number of well establish firms will compete with CCG. These firms have entered into partnerships all over the world and they are interconnected by sharing a name and corporate wisdom. However, due to the size of the market available, it will be difficult for these competitors to gain significant market share because they normally charge very high rates for their services. On the other hand, it will be difficult for CCG to control the market. Competition and Buying Patterns The key element that drives purchasing decision for CCG clients is the trust in the professional reputation and the reliability of the firm. Main competitors Main competitors of CCG are categorized into four: Segment competitors- these are rivals who offer the same services as CCG. These firms also focus on small and medium business and offer them strategic direction. CCG will build its name in order to be successful Market specific rivals- these are rivals competing with CCG with a slightly different business focus. CCG will compete with these firms by showing their expertise in marketing. Generic rivals – these kinds of competitors offer alternative solutions to the client’s problems. For example, the alternative of outsourcing work is to performing the work in-house. CCG will convince its clients that performing an outsourcing work is important. For example, it will enable them to utilize the core competencies of the consulting firm and also reduces the costs of hiring full-time employees. Structural rivals- these are the forces available in the market that CCG operates. Distribution Strategy CCG will first focus on United States’ small and medium sized businesses. After securing their first clients, it will then expand to Latin America where small businesses are emerging. Management CCG needs a high level of expertise and experience in marketing for high-tech products and this is a feature that is not readily available in most common consulting companies. Currently, the management of CCG is not highly experienced. As the firm expands, experienced management will be needed for CCG so that it can manage multi-million dollar organization. CCG will be sought for assistance from veteran business so as to provide insights. Financial Feasibility CCG consulting will be priced at the upper market price. This pricing strategy fits with CCG’s ability to provide a high level of expertise. CCG sales estimates project revenues of about $159,000 in year 1 and $280,000 in year 3. Start-up summary Total start-up expenses including registration, insurance, stationery, etc are $48,000. The cost of acquiring the required assets and other equipment is $72,000. An initial cash of $25,000 will be available to run the operations for the first few months. The details are available in the appendix1 References Blackwell, E., 2011. How to Prepare a Business Plan: Create Your Strategy; Forecast Your Finances; Produce That Persuasive Plan. Kogan Page Publishers. Blank, S., 2013. Why the lean start-up changes everything. Harvard business review, 91(5), pp.63-72. Moogk, D.R., 2012. Minimum viable product and the importance of experimentation in technology startups. Technology Innovation Management Review, 2(3), p.23. Number, E.I., 2014. to apply for an EIN. You can apply for. U.S Bureau of Labor Statistics 2016. The High-Tech Industry. What Is It and Why It Matters To Our Economic Future. Accessed May 14, 2017 from: https://www.bls.gov/opub/btn/volume-5/the-high-tech-industry-what-is-it-and-why-it-matters-to-our-economic-future.htm Wirtz, B.W., Pistoia, A., Ullrich, S. and Göttel, V., 2016. Business models: Origin, development and future research perspectives. Long Range Planning, 49(1), pp.36-54. Appendix 1 Start-up Costing for CCG - 2017 START-UP COSTS Cost ($) EQUIPMENT/CAPITAL COSTS Cost ($) Registrations Business purchase price  6000 Business name 250 Franchise fees  5200 Licenses  300 Start-up capital  25000 Permits  300 Plant & equipment   Domain names  500 Vehicles  0 Trademarks/designs/patents 250  Computer equipment  15000 Vehicle registration  1000 Computer software 5000  Membership fees  500 Phones  2300 Accountant fees  500 Fax machine  1800 Solicitor fees  500 Security system  10000 Rental lease cost (Rent advance/deposit)  2000 Office equipment   Utility connections & bonds (Electricity, gas, water)  3000 Furniture  1500 Phone connection  500 Shop fitout  200 Internet connection  300     Computer software  4500     Training  8000     Wages  10000     Stock/raw materials  2500     Insurance       Building & contents  2000     Vehicle  0     Public liability  0     Professional indemnity  0     Product liability  0     Workers compensation  5000     Business assets  3000     Business revenue  2300     Printing  200     Stationery & office supplies  200     Marketing & advertising  500     Total start-up costs $48,000 Total equipment/capital costs $7200 Assumptions: All figures are GST exclusive. 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