Analysis of Business Plans Developed by Sana Sana Limited and Vusion, Inc - Example

Engineering Management Report Name: Course: Tutor: Institution: Date: Table of Contents Table of Contents 2 2.0 Business Plan Strengths 4 2.1 Sana Sana Plan Strengths 4 2.2 Vusion Inc. Plan Strengths 4 3.0 Business Plans Weaknesses 5 3.1 Sana Sana Plan Weaknesses 5 3.2 Vusion Inc. Plan Weaknesses 6 4.0 Improvement Recommendations 7 4.1 Consumer Surveys 7 4.2 Innovative Market Strategies 8 4.3 Venture Specialization 8 5.0 Challenges in Developing Business Plans 9 5.1 Time Constraints 9 5.2 Future Uncertainty 9 5.3 Competition Analysis 10 6.0 Lessons Learnt 10 7.0 Conclusion 11 References 13 1.0 Introduction Changing global conditions have necessitated the development of appropriate business plans as a strategic management approach through which business start up success could be enhanced. However, just like the strategic management approach itself that faces increased management challenges, the development of business plans process is challenges and opens to many risks. As such, in order to offer a practical touch on the discussion, the report reviews two business plans developed by Sana Sana Limited and Vusion, Inc. companies respectively. On one hand, the Vusion Inc. Limited is a chemical industry stakeholder seeking to develop an electronic chemical analyzer through which complex chemical components can be easily analyzed, thus playing a significant role in improving chemical products quality and enhancing chemical products processing efficiency among others (“Vusion, Inc.”, 1999). On the other hand, the Sana Sana Company is a B2B2C business setup that targets the Hispanic speakers in the USA. In this regard, based o the knowledge that the Hispanic speakers population increases with the existing healthcare services offerings in the market the business ventures seeks to liaise with interested healthcare organisations as well as the non-healthcare providers such as the insurance agencies wishing to tap into the market through its business structures and distribution avenues (“SanaSana”, 2000). This report seeks to evaluate key strengths, weaknesses and challenges encountered in developing ideal business plans using the evaluated as case examples. 2.0 Business Plan Strengths 2.1 Sana Sana Plan Strengths The business plan targets a wide consumer base. As enumerated under the consumer analysis, the organizational venture targets the Hispanic speakers in USA. This population has in the last decade increased and is bound to increase into the future. Moreover, its focus on both the B2B and BSC models offers it an increased market merit in that its market base is considerably increases. Therefore, this increases the venture success rates credibility. In addition, the proposed venture businesses plan a major strength in the existence of a strong and experienced management team. The proposed executive team under the leadership of Ms. Elizabeth and Mr. Farkas represent a qualified and experienced workforce. Therefore, the presence of such an experienced management team will increase its success probabilities due to their conversance with the market needs and environmental influencing factors. Vakola, Soderquist and Prastacos (2007) argued on the role of management on an organizational venture success. In this regard, the authors established that a majority of start-up ventures failed in their formative and market introduction years due to poor leadership. Therefore, they concluded that organisations with experienced and qualified management had increased success changes in the market. Finally, a strength analysis on the business plan is the existing USA favourable healthcare policies that enhance increased investment potential as investors are guaranteed of government goodwill and support of the venture. 2.2 Vusion Inc. Plan Strengths The Vusion Inc. Company business plan first strength is the proposed executive management team. In this case, the management consists of the existing qualified and experienced staff such as the organizational President and the Chief operations officer Mr Lewin and Brandshaw respectively. The pooling of these experiences to manage the proposed venture promotes its market conformance rates in the industry. Moreover, the organization targets and intends to utilize the B2B business model. In this regard, the venture will sell and trade with other chemical industry organisations wishing to acquire the merits of improved chemical analysis processes. Therefore, this reduces the marketing and distribution needs for the organization. Doole and Lowe (2007) stated that unlike the consumer market under the B2C model, the B2B platform required minimal advertising and marketing promotions, subsequently reducing on the overall organizational venture start-up costs. Further, a review of the proposed business venture establishes that the organization is bound to benefit from changing technology. Its operations are based on the adoption of recent technologies for chemicals mass production. Therefore, increased chemicals production as well as the high chemical composition analysis regulatory standards is likely to form a market basis for the proposed chemical analysis, which targets fitting in chemical production plants where the fitted beads react differently to diverse chemicals making reliable for chemicals mass production. 3.0 Business Plans Weaknesses 3.1 Sana Sana Plan Weaknesses Although business diversification allow for an increased consumer base, the proposed Sana Sana venture diversity on both B2B and B2C business models is likely to pose an operational challenge. Unlike already existing ventures that have already established their brand identities and market position, the venture is a start up business. Therefore, this makes its positioning and branding in any of the market hard due to lack of specialization. Grant and Vidler (2000) argued that the USA market was increasingly shifting to specialization, with each of the market servers seeking a specialty for increased products and services quality. Therefore, this might negatively influence the venture market penetration. Moreover, focusing on Hispanic speakers only denies the venture future growth opportunities to other aboriginal speakers in USA, subsequently limiting its future expansion potential. In this case, the returns are likely to stagnate in the future, once the entire Hispanic speakers’ population is captured, and there is no more market expansion in USA, unless as proposed its goes international. Instead of focusing on the Hispanic speakers alone, the venture should have focused on all immigrant groups into USA that share culture diversities and perspectives. Finally, a weakness review establishes that the rolling out of all inclusive healthcare programs by the US government such as the Obama care health program is likely to draw the target population, thus reducing its target consumer base. 3.2 Vusion Inc. Plan Weaknesses One of the major Vusion Inc. business plan weaknesses is the required high initial capital. For the venture to kick off, it requires a minimum $1.5 million as its start-up package. This high capital amount is for the acquisition of an operations license, develop a prototype and hire an experienced CEO. Thus, this illustrates that a major share of the start-up capital will not be utilized directly in developing the desired chemical analyzer. Consequently, this may serve as a limitation for potential investors who may feel that the returns on the initial capital investments are not guaranteed. In addition, the proposed venture requires the application of modern technology skills and expertise in its development and installation as well as maintenance. Consequently, this is likely to increase its production and acquisition costs, risking high and unaffordable prices in the market. Besides the actual analyzer acquisition costs, organisations will incur additional costs on installation and training staff on utilization and maintenance of the analyzer, an approach likely to increase respective organisations production costs. Lastly, the organization lacks innovative marketing strategies. In this regard, the organization seeks to employ the services of their partners in the distribution and marketing of the products. Kiskis (2009) stated that although likely to reduce on direct promotional costs, the approach will reduce the development o an organizational brand reputation in the market, a virtual relevant for its overall growth and enhanced consumers loyalty. 4.0 Improvement Recommendations Based on the analyzed business plans strength and weakness analysis, the report establishes that there is need to improve on the development and drafting of business plans as a measure to increase their overall success possibilities. As such, this report develops three improvement recommendations namely increased consumer survey analysis, innovative marketing strategies, and business ventures specialization respectively 4.1 Consumer Surveys For any business venture to succeed, whether new or existing, it is important for such a venture to evaluate its consumer base. Such evaluation can be done through a range of approaches such as industry statistics analysis s well as primary data collection through consumer surveys and research initiatives. A review of both analyzed business plans reveals how critical a consumer survey and analysis is. For instance, an accurate and proper identification of the existing consumer base for a chemical analyzer among manufacturers has enhanced increased success of the Vusion Inc. success possibility in the market. However, on the contrary, failure to identify an existing wider consumer base of aboriginals in America has narrowed down Sana Sana business venture long-term expansion possibilities. 4.2 Innovative Market Strategies Besides the development of products with unique features, business success is hedged on the ability to push through its products through the supply and distribution chain to the final consumers. However, the global market is characterized by increased competition, making uniqueness through formal marketing channels imperatively hard. As such, McLeish (2011) argued that it is important for organisations to develop unique marketing strategies as an approach to improve their market competitive edges. For instance, a limitation is evident in the Vusion Inc. business plant where instead of directly relating and developing relationships with industry consumers, the venture seeks to utilize partners distribution channels =, an approach likely to reduce its brand image and organizational market reputation. Therefore, this report argues that in order to facilitate increased market influence, ventures should develop unique marketing strategies to overcome already existing or future competition. 4.3 Venture Specialization Current global markets demand quality and high standards. As such, this has resulted to increased need for organisations focus in the production and de-livery of specific products and services respectively. For organisations with multiple products and services, they have developed independent profit centres with decision and strategies formulation independence. Consumers perceive specialized organisations as providing superior products than their diversified peers, as perceived in the increased market penetration strength by Vusion Inc. chemical analyzer venture. 5.0 Challenges in Developing Business Plans An evaluation of both Vusion Inc. and Sana Sana business plans establishes that the preparation of the plans face a range of challenges that need be overcome in order to develop appropriate and appealing business plans. Among the common challenges exhibited in both samples include time constraints, future uncertainty and increased competition 5.1 Time Constraints The development of a business plan is a component f a business venture establishment or growth and expansion. Moreover, increased pressure from the market and investors reduces available time for the development of an appropriate business plan. Consequently, this leads to haste in the drafting and wring the plans that not only lead to errors, but also to the omission of important details. Therefore, as an improvement and business plan development time constraints mitigation measure, it is imperative that organisations adopt is a continuous process rather than a one off business practice. As such, organisations should regularly update their business plans as their operations unfold to enrich and enhance their objectivity. Such an approach would increase time allocations for the development of not only brief but also detailed business plans attractive to investors as well as with potential for market success. 5.2 Future Uncertainty One key aspect of a business plan is the adoption of a futuristic approach in its information presentation. In this regard, the business plans success relies on accuracy of the forecasted future market trends. Fr instance, a product features success relies on the evolution of consumer traits and decision making models as forecasted. In addition, revenue and cost gains on the forecasted balance sheets, income statements and cash flow statements rely on the retention of predicted inflation rates as well as economic growth rate trends. A variance of any of these variables render such forecasts irrelevant exposing potential ventures to market failure risks. In order to overcome this challenge, as Nesheim (2010) stated, it is imperative for organisations to adopt standard forecasting tools in their market and financial trends forecasts. 5.3 Competition Analysis A major established challenge in the development of business plans is the provision of significant and detailed competitor’s analysis. Such analysis allows investors to benchmark and compare the proposed ventures with their industry competition to establish their market competitiveness and edges. However, obtaining competitors data is hard as a majority of private organisations retain data privacy in a bid to reduce competition emulation. If such data is unavailable through secondary means such as industry statistical analysis, organisations should conduct consumer surveys to obtain consumers perceptions of their competitors. 6.0 Lessons Learnt Based on the report review and a critical analysis of the analyzed business plans I have learnt a number of issues on effective and successful business plan writing and development. On one hand, I have learnt that in order to develop an accurate business plan it is imperative to base vision with market analysis and surveys. As such, only business plans with intensive consumer base surveys are bound to expand onto future profitable ventures. Moreover, I learnt that the application of appropriate forecasting tools is an imperative function in the enhancement for the development of accurate financial forecasts. In this case, I established that besides the evaluation of product features and competition, many investors base their funding and partnership decisions on financial forecasts and rates of return. Therefore, if such forecast emerge inaccurate within operational short run period, investors are likely to withdraw their support and funding on such ventures leading to their collapse. In addition, I learnt that a business plan most captivating aspect is the development of a product uniqueness statement. Currently, investors are seeking out ventures with unique product features to reduce and overcome current global competition rates as well as one with the ability to develop sustainable competitiveness, guaranteeing long term gains. Therefore, only business plans that adequately distinguish their products from the competition are likely to acquire funding and investors alliances and partnerships. Moreover, I learnt that in the development of a business plan it is imperative to develop an appropriate, qualified and experienced management team. As evidenced in the case of the Vusion Inc. business plan, its major strength is in the experienced management, a component that instils investors’ confidence in the ability of the organization to execute and implement the listed business model. Further, I learnt that besides product and management role in success, an organization’s distribution chain plays a major business plan success. In this regard, based on the Sana Sana business plan I established that the adopted business distribution channels form an imperative component influencing not only distribution capability but also on the overall production costs and market reputation. 7.0 Conclusion In summary, the report critically reviews the Vusion Inc. and Sana Sana business plans. In this regard, the report establishes that a shared strength between the two is the presence of a strong management team. Other identified individual strengths include adopted specialized market models as well as the presence of favourable business climates. On the other hand, a weakness analysis establishes that both plans suffer a shortage on competitors’ analysis. With respect to improvement recommendations the report lists measures such as consumer primary surveys and development of innovative marketing strategies. Further, a critical analysis of both business plans reveals that they have time constraints, lack sufficient competitor’s analysis and rely on future market trends stability. Finally, an evaluation of lessons learnt on the business plan development, I list lessons such as the relevance of a qualified management, appropriate forecasting tools and the perception of business plan development as a continuous management process among others. Therefore, based on this analysis, the report concludes that business plans, despite the challenges encountered in their preparation and development serve as key organisational fund sourcing tools and thus managements should increase their focus on their development. References Vakola, M., Soderquist, K. E., & Prastacos, G. P. (2007). Competency management in support of organisational change. International Journal of Manpower, 28(3), 260-275. Doole, I., & Lowe, R,. (2007). Strategic marketing decisions 2007-2008. Oxford: Butterworth-Heinemann. Grant, S., & Vidler, C. (2000). Economics in context. Oxford: Heinemann. Kiskis, M. (2009). Direct electronic marketing opportunities for SMEs. Intelektine Ekonomika, 2(6), 61-72 McLeish, B. (2011). Successful marketing strategies for nonprofit organizations: Winning in the age of the elusive donor. Hoboken, N.J: Wiley. Nesheim, J. L., (2010). The power of unfair advantage: How to create it, build it, and use it to maximum effect. Hamilton, N.Z.: Summaries Communications SanaSana, (2000). Business Plan. Center for Business Planning. Retrieved from Vusion, Inc. (1999). Business Plan. Center for Business Planning. Retrieved from Read More