Example Business Plan - Service Based Product

Business PlanHotel Canine – Dog Kennel15th May 2012

Jason Cates,Isaac Arjona Cano,Maria Teresa Román,Sabrina Borza &Inmaculada Galván

Hotel Canine (Dog Kennel) Small Business Development

Table of ContentsExecutive Summary...........................................................................................................................2

Business Review................................................................................................................................4

Mission Statement.........................................................................................................................4

Business Overview........................................................................................................................4

Objectives......................................................................................................................................4

Industrial Overview & Potential Market........................................................................................5

Target Market................................................................................................................................5

Location.........................................................................................................................................5

Porters Five Forces............................................................................................................................7

Competitors (Rivals)......................................................................................................................7

Market Research Analysis...............................................................................................................10

Opportunity Analysis (SWOT Analysis).........................................................................................11

Strengths......................................................................................................................................11

Weaknesses.................................................................................................................................11

Opportunities...............................................................................................................................12

Threats.........................................................................................................................................12

Marketing Analysis.........................................................................................................................13

The Four P’s................................................................................................................................13

Marketing Strategy......................................................................................................................15

Corporate Governance.....................................................................................................................16

Legal Structure............................................................................................................................16

Board of Directors.......................................................................................................................17

Intellectual Property....................................................................................................................18

Director Remuneration Report.....................................................................................................19

Director Share Options Report.....................................................................................................20

Financial Analysis...........................................................................................................................21

Growth & Harvest Strategy, Critical Risks and Milestones.............................................................29

Growth and Harvest Strategy.......................................................................................................29

Critical Risks...............................................................................................................................30

Milestones...................................................................................................................................31

Harvard Referencing........................................................................................................................32

Signatories.......................................................................................................................................34

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Executive Summary

This business plan is written with the aim of obtaining two individual loans of €4000 each. These loans with both have an APR of 6.9%. The first of these loans will be required in August 2012 and the second in July 2013. Each of these loans will be repaid with 8 months of issuance. In addition, the company directors will invest a total of €35,000 in share capital into the company in April 2012.

For most people who own a dog, having someone look after them while away proves to be a major problem. This includes holiday, travelling on business or other long distance commitments. Simply, who can take care of their dogs while the owner is away? Hotel Canine primarily focuses on providing day and overnight care for dogs. However, we will also provide secondary services alongside this including pet grooming, animal training and a pet store. In the long term, we can expand into providing day and overnight care for other animals besides dogs. Our unique selling points will be our webcam service and our large outdoor space.

Our kennel will cost €15 for a stay of 24hrs. Our animal grooming service will cost an additional €15. Our dog training will cost €20 for 3 hours alongside other dogs or for 1 hour on a one-to-one basis. Our pricing model will be based on simplicity and convenience for our customers.

According to the 2007 French Census, the population in Nice is approximately 350,000. Furthermore, the national average of households owning a dog is 27.8%. Based on these figures, there are approximately 97,000 dogs in the Nice area. Based on information adapted from the American Pet Products Association, this equates to a total market value in Nice of €1.1Million. (APPA, 2010) (Pages Jaunes, 2012) (City Population, 2009) (WSPA, 2007)

We have 8 direct competitors in the Nice area and another located in Villeneuve-Loubet. As such, if the market was divided equally between ourselves and these 9 competitors, we’ll each have a market share of 10%. This equates to us having potential revenues of €110,000, not including the additional services we provide. We will differentiate ourselves based on providing a high quality service rather than on issues such as price.

Our market research suggests that our business will likely be a seasonal one with most of our business being carried out over the winter period. This means that for the rest of the year, we will likely be performing significantly below optimal capacity with most of our customers being those travelling on business. We also found two potential threats to our business. This includes the fact that people are taking fewer foreign holidays than they used to. However, the main threat to our business is our lack of reputation in the local area. Simply speaking, if people don’t know us, they are less likely to trust us with their pets. In the long term, our success will be based on the positive “word of mouth” of our customers.

Overtime, as our kennel expands, we will gain economies of scale, reducing our fixed cost per unit. This is shown in the table below.

Year Price Variable Cost Fixed Costs Profit (Per Unit)

2013 € 15.00 € 3.22 € 12.31 -€ 0.522014 € 15.00 € 3.22 € 10.07 € 1.71

2015 € 15.00 € 3.22 € 9.39 € 2.40

2016 € 15.00 € 3.22 € 9.39 € 2.39

2017 € 15.00 € 3.22 € 9.39 € 2.39

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Hotel Canine will be established as a Private Limited Company, clearly defining the structure of the business separately from its members. This will also allow the business to raise additional finance and bring new people into the business as required. The company will be managed in accordance with its Articles of Incorporation with the Board of Directors determining long term strategy.

Our sales will continue to grow during our first 18 months of trading. This growth will be more significant during the winter season when the demand for our services will be higher. Our sales will level out towards the end of our second year of trading, reaching a peak of 22 dogs in late 2013. This will see our revenue level off at approximately €153k in the financial year 2014/2015. We are forecasting a loss of €2.5k in our first year of trading. This will turn into a profit of €14.5k in our second year of trading and approximately €21k every year thereafter.

Our loans are required due to the need to build up a core customer base for our kennel over a period of time. This means the cash flow in our first two years of trading is not as strong as we would like it to be. These loans will see our minimum cash balance reach €3277.80 in August 2014. This provides us with an adequate safety buffer if we perform below expectations or additional costs are incurred. The majority of our cash will be generated in the second half of each financial year with cash levels decreasing during the first half. This is due to the high level of seasonality in our industry.

The bulk of our capital expenditure will take place in the months prior to the opening of our kennel. This is in order to get the kennel prepared for opening with minimal impact on our customers. Initial capital expenditure in our first year will total €19.2k. We also set aside €1500 a year for repairs and/or replacement of property and equipment.

Our break-even point in our first year of trading will be relatively low compared to later years. In our first year, we will need an average of 12 dogs in our kennel or equivalents from the other parts of our business at any one point throughout the year. It will then rise to 23 dogs a day (or equivalents) in our second year as we begin to pay ourselves a more sustainable salary to live on. It will then fall back again in our third year once we have fully repaid our loan capital to our creditors. Our main costs will be those of fixed costs. This is because our business is more service based than manufacturing based.

Our future strategy would consist of natural growth and diversification into other animal care services. This will include widening the geographical area in which we operate and expanding the range of services we offer. Our future strategy will include looking for a new property in addition to our current premises. This secondary facility will likely be located in another city such as Cannes. This will widen the geographical area in which we operate and help ensure our companies long term sustainability. There is also an option of widening the range of animals we offer our kennel service to. This strategy will allow us to broaden both our target market and our range of revenue streams. We can also hire a qualified vet to offer our own veterinary service. Due to the costs involved, such an option will not be utilised until our company has grown enough to afford such a service

One of the major risks relating to our business is our failure to build a positive reputation within the first year of operating. By providing our customers with as much information as possible, we mitigate some of the risk this places on our kennels future profitability. The distance of our kennel from the centre of Nice may be off putting for a number of potential customers. However, this location is vital in providing the healthy environment for the animals in our care. If we ensure a high level of communication between our Kennel and the customers, we will be able to mitigate some of the risk associated with this type of strategy

Incorporating our business mitigates much of the financial risk associated with all businesses. This means there is less risk to our directors financially if the business were to collapse and vice-

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versa. This gives us the room to take greater risks with the company as without risk, there is no reward.

Business ReviewMission Statement

Striving to provide a safe haven for our beloved furry friends

Business Overview

During its early years, Hotel Canine will primarily focus on providing day and overnight care for dogs. However, it will also provide secondary services alongside this including pet grooming, animal training and a pet store. In the long term, it is a possibility that we can expand into providing day and overnight care for other animals besides dogs.

Our service will include providing 24 hour care for the animals placed in our care. This will also include having webcams placed in each of our kennels in which owners can connect to in order to ensure their animals are well cared for. This feature will act as one of our “Unique Selling Points”, the other being us having a larger outside area than our competitors. This will allow the dogs in our care to lead more active and healthier active lives while in our care. These will be enclosed gardens around our buildings ensuring helping to ensure they our animals are safe and secure. In the long term, we may move into providing other animal care services such as vet care and animal insurance.

In terms of the pet grooming and training services we offer, our main USP of these services is that they can both be offered while the animals are in our care. Therefore, owners will not have to wait around while we offer these services providing them with a high level of convenience. In terms of our pet store, its main focus will be to complement our other services and create an additional income stream for our business.

The prices for our service will vary depending on the service provided. Our dog sitting service will cost €15 for a stay of 24hrs. Our animal grooming service will cost an additional €15. Our dog training will cost €20 for 3 hours alongside other dogs or for 1 hour on a one-to-one basis. Our pricing model will be based largely on simplicity and convenience for our customers.

Objectives

Generate in excess of €9500 in revenue per month by April 2013

Ensure the net losses in our first year remain less than €3,000

Make a net profit of at least €15k in our second year of trading and €24 every year thereafter

Maintain a minimum cash balance of €3000

Have a growing cash balance by December 2013

Fully repay both the companies bank loans by March 2014

Start planning on the move to a larger premises by March 2015

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Industrial Overview & Potential Market

According to the 2007 French Census, the population in Nice is approximately 350,000. Furthermore, the national average of households owning a dog is 27.8%. Based on these figures, there are approximately 97,000 dogs in the Nice area. Therefore, there is no shortage in terms of potential customers for our business and the services it provides. (City Population, 2009) (WSPA, 2007)

Furthermore, based on information adapted from the American Pet Products Association, people spend on average €7.68 a year on animal boarding and €3.61 a year on grooming. This equates to a total market value in Nice of €1.1Million. We have also found that we have 8 direct competitors in the Nice area and another located in Villeneuve-Loubet. As such, if the market was divided equally between ourselves and these 9 competitors, we’ll each have a market share of roughly 10%. This equates to us having potential revenues of €110,000, not including the additional services we provide. (APPA, 2010) (Pages Jaunes, 2012)

Target Market

Our services will be aimed at slightly different markets based on the specific services we offer. The market for our dog care service will be owners who will be away from home and are unable to take their pets with them or to have a friend take care of them while they are away. This will include families who go on holidays during the winter and professionals who travel on business throughout the year.

Our dog training service will be attractive to new pet owners or people who are struggling to control their pets. This is while our pet store and grooming service will appeal to all dog owners within the local area who use our dog kennel service.

We will invest significantly in marketing throughout the life of our business. However, our business will rely heavily on word of mouth in order to gain new customers and retain repeat customers. However, as long as we can tap into a small percentage of this 97,000 dog market, our business will continue to grow. (City Population, 2009) (WSPA, 2007)

Location

Hotel Canine will be located at 221B Route de Saint Antoine in Nice as shown in the map below.

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*Hotel Canine is identified by the white circle and each of the yellow tags represents a competitor. (Pages Jaunes, 2012)

Map Index

1. Star Dog & Cat

2. Pop-Dog

3. Dog’s Follies’

4. Star Lady Dog

5. Castel Dog

As you can see, Hotel Canine is somewhat outside of Nice in comparison to our rivals. This is in order to make our kennel different from our competitors.

Simply speaking, as our kennel is outside the central Nice area, our rent bill is lower per square meter of space. This means we can afford slightly larger premises than our main competitors located in the centre of Nice. This means the environment in which we keep our dogs is better suited to their needs. This includes having less traffic around our kennel reducing noise pollution that makes many dogs feel uncomfortable. This also means we can provide an outdoor space for our dogs to exercise. This will help towards our lack of reputation in the local area and improve our standing in the eyes of the customer. More detailed satellite images of our kennel are shown below. (Rent in France, 2012)

(Google Maps, 2012)

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(Google Maps, 2012)

Porters Five Forces

Competitors (Rivals)

As can be seen in the price comparison below, our pricing policy will be in line with our local competitors. Therefore, in order to compete effectively, we will do so based quality rather than on price. This will include emphasising our unique selling points in the form of our webcam service and our outside space.

Pattes et Griffes € 12.50

The Hotel Canine € 15.00

Animal Holiday € 15.00 or €10 for home visits

Dog Attitude € 16.00 for 1st dog, €15 thereafter

(Pattes et Griffes, 2012)(Animal Holiday, 2012)(Dog Attitude, 2012) (Pages Jaunes, 2012))

As you can see, we found three competitors in which we could find significant information about. We will now go through each of these competitors one by one discussing their main features. We have also listed some of our other competitors in the local area. But due to having strategies similar to those we have discussed, these competitors will be considered, but not as thoroughly analysed in this plan.

Animal Holiday

Animal Holiday provides two main services. One is the same as ours in terms of providing onsite care for dogs. This service is also offered at the same price as us, therefore, we will have to compete on a purely “service offered” basis. This is something we will have to consider when it comes to the way in which we operate and care for the animals within our care. The second service they provide is to offer home visits while people are away. This is a service they offer at a reduced rate of €10 as compared to €15 for their onsite care. (Animal Holiday, 2012)

As stated, Animal Holiday offers home visits which are something we don’t offer. Therefore, in order for us to compete with this, we will have to emphasise the other services we offer alongside

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Other Competitors

Star Dog & Cat

Pop-Dog

Dog’s Follies’

Star Lady Dog

Castel Dog


animal care. This includes animal training, grooming and a pet store which are all things that Animal Holiday doesn’t offer. We will also have to promote our webcam service which will improve our accountability and build customer trust in our business. (Animal Holiday, 2012)

Dog Attitude

Similar to us, Dog Attitude also provides 24hr care for its animals as well as the option of additional training. Also like us, they have outside grassland in which the dogs can use for exercise, in this case, 300m2. However, unlike us; it doesn’t provide a webcam service or any of our other additional service. As shown above, Dog Attitudes pricing model is slightly different from ours. Firstly, it is €1 more expensive than us when it comes to the first dog, then the same price as us for any subsequent animal their customers place in their care. Therefore, in this case, we have the competitive advantage when it comes to pet owners who only have one dog. (Dog Attitude, 2012)

Pattes et Griffes

Pattes et Griffes offers the lowest priced service among our competitors offering a price 17% lower than what we offer. Therefore, unlike our other competitors, Pattes et Griffes is competing specifically on price. As we have no intention of cuttings our prices to a level that will allow us to compete in term of price with Pattes et Griffes, we will have to ensure the services we provide are significantly better than those offered here. Simply speaking, this is the only competitor that has a significantly different business than the one we are running. Therefore, this is the one we will have to keep the closest watch on as to keep up with what they are doing as a business. (Pattes de Griffes, 2012)

Like the other competitors here, Pattes et Griffes also has land in which the dogs can use to exercise and remain active. Therefore, we will ensure our pet store is up and running as quickly as possible and ensure the other services we provide are at the level needed to compete.

New Entrants

In the future, there is the potential for new entrants to enter the market. As what we offer is a service rather than physical product. Therefore, we are unable to patent or copyright our idea. Therefore, all we have to protect the continuing success of our business is to maintain a better reputation than any of our potential rivals. Therefore, maintaining this reputation will be the main barrier of entry for any companies entering the market.

Substitutes

In terms of are overnight care service, pet owners have the option of leaving their pet animals with friends or family while they are away. This is often done for free or if it is paid for or at a fraction of the price we charge.

In terms of our other services, pet owners are increasing grooming their own pets. Therefore, this is likely to be a luxury service which will appeal to people on higher incomes. As such, we will have to promote this service to this particular market. When it comes to training, experienced dog owners will be able to train their dogs to a level appropriate to them. However, inexperienced dog

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owners or those who do not have enough time to train their dogs will have to seek out services such as ours. Therefore, in this case, our priority is beating the competition rather than our substitutes.

In terms of competitors, some may offer to come to your home to train your dog. This is direct threat to us and something we will have to consider when it comes to delivering this service. Moving on to our pet store, again, the only real alternatives are the local supermarkets. This is the case for all the products in which we would sell in the store, be it food, toys or any other accessories.

Power of Suppliers

There is a diverse market in terms of our suppliers, both generally and in the Nice area. This includes the food we’ll need for our kennels as well as the inventory we’ll need for our pet store. This means the switching costs we’ll have when switching supplier will be minimal. The only costs that may appear will be the loss of bargaining power we’d have with suppliers in which we had a long term relationship with. We will have to also consider the increase in bureaucracy while we manage the transition of moving from one supplier to another.

If we maintain the same suppliers for both our store, and our kennel business, over time this will give us more bargaining power with our suppliers and hopefully help us reduce our long term costs. Backward integration is also something we can consider in the longer term to helps reduce our costs even further by cutting out the middle man. However, while we are still establishing ourselves, our suppliers will have some degree of power due to the relatively small orders we’ll be making. This power may include what prices we’ll have to pay well as the service we can expect from those suppliers. As a result, we’ll have to be prudent when it comes to finding the right suppliers for our business. However, as stated, there is a very diverse market when it comes to our potential suppliers, so we have plenty to choose from. Over time, as our orders begin to grow, so will our bargaining power. This may become vital to our business over the long term.

Power of Customers

Once we are established, our customers will have limited power over us as we will have multiple customers in which we can make our revenue from. However, they’ll likely have more power over us while we are still becoming established. This will be because we’ll need to initially grow our business through word of mouth and maintaining a good reputation among our customers. In the long term, main power coming from customers will be in the form of multiple purchases. This is something we will come to rely upon if our business is to have long term viability. As if we end up losing loyal customers, we will have to spend money finding new customers to replace them. This may end up costing the business a significant amount of money if not managed carefully.

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Market Research Analysis

Our market research involved asking 35 people in the centre of Nice a series of questions relating to our business idea. This includes both, people who own a dog and those who don’t. This is to ensure we get a broad and diverse range of views relating to our business. However, this excludes questions that relate specifically to dog owners in which case we only asked those who actually own a dog. We also tried to question different types of dog owner. This includes families, retirees and young dog owners. Again, this is to ensure we get a broad range of opinions when carrying out our market research.

Our market research has shown that 31% of the local population own at least one dog which is higher than the national average. Our research also suggests that on average, people spend 4 weeks a year away from home. Again, this is slightly higher than the national average with people in Nice more likely to travel over winter than at any other time of the year.

This research suggests that our business will likely be a seasonal one with most of our business being carried out over the winter. This means that for the rest of the year, we will likely be performing significantly below optimal capacity with most of our customers being those travelling on business.

Our market research also found that there were two potential threats to our business. This includes the fact that people are taking fewer foreign holidays than they used to. This significantly reduces the size of our potential market. We also found that more and more people are having their friends or family look after their dog while they are way. Again, this reduces the size of our potential market. However, like we said before, our research suggested that, even though our potential market has shrunk in recent years, its starting position was higher than we originally expected.

Current information suggests that 70% of dog owners would be willing to put their dog into a kennel such as our own, but only 60% actually do. They also said that the average price they were willing to pay for our service was €15 a day. This is in line with the price we are currently charging.

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Relating specifically to our business, we found that the main concern for people was our lack of reputation in the local area. Simply speaking, if people do not know us, they are less likely to trust us with their pets. This is something we cannot overcome very quickly and will have to be developed naturally overtime. All we can do until then is ensure the customers we do have a positive experience with us and encourage them to recommend our service to other dog owners in the area.

Opportunity Analysis (SWOT Analysis)Strengths

One of our company’s key strengths is the diverse skills and experiences of its directors. These skills include finance, marketing and general business administration. These diverse skills will help facilitate the running of the business from the filing of tax returns to the implementation of the company’s marketing strategy.

Due to establishing our company as a Private Limited Company with multiple directors, the level of finance available to the company is also improved. This separation of legal entities reduces the risks associated with investing in our business, be it in the form of either debt or equity. This makes financers more willing to invest in our business and reduces our long term cost of capital. This separation also means the company’s long-term future is more secure. This includes the kennel’s continuation if one of the directors were to leave the business. (Business Link, 2012a)

Our high level of human resource capital also increases the number of competences the company can diversify itself in. Again, this will help reduce our long term risk. This will increase our number of revenue streams ensuring our companies long term stability and financial security. This also means we can take a greater number of dogs into our care, boosting our potential revenue income.

Locating our kennel outside the centre of Nice also means we can afford larger premises than many of our key competitors. This means we’ll be able to offer a better quality service in offering an outside area for our dogs to exercise in. This will differentiate us from our competitors and act as our USP in the local area. This will also help solve our problem regarding our lack of reputation in the short to medium term. (Rent In France, 2012)

Weaknesses

The weaknesses of our kennel as compared to our competitors include our lack of a positive reputation and our distance from the customer. Our lack of a positive reputation can be overcome naturally with time through the word of mouth of our customers and ensuring long term customer

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retention. However, the distance we have from our customers will remain a strategic weakness if we are to have larger premises than our competitors. However, this does mean we have no competitors within 20 minutes of our kennel and we can target customers in both Nice and the surrounding towns such as St Laurent Du Var. (Rent if France, 2012)

We previous listed having a large and diverse workforce as being an advantage. However, it can also be considered a weakness due to the high costs of maintaining such a workforce. Therefore, this workforce will have to be carefully managed to ensure it remains sustainable in the long term. Appropriate actions will then have to be taken once it is deemed no longer sustainable.

There are also weaknesses inherent with being a Private Limited Company in regards to higher levels of regulation. This includes being required to disclose greater levels of information in regards to company performance. This increases the level of bureaucracy faced by the company and takes up time that can be better spent elsewhere. It also places a greater tax burden on the company with tax having to be paid on both, employee wages and company profit. This significantly reduces the level of cash available to the business for future expansion, restricting future growth.(Business Link, 2012a)

Opportunities

There are a number of ways the kennel can expand and diversify in the future. The most obvious option would be to move into a larger kennel or open a 2nd kennel at another location. This will enlarge the geographical area our kennel(s) can cover, both increasing and diversifying our potential market.

We can also expand the services that we offer to include a wide variety of services that relate to dog ownership. This may include expanding our pet store or moving to a more central location in the heart of Nice. However, we also have the option of expanding our business to include a veterinary service or dog breeding service.

Each of these will have to be considered on their own merit with action not being taken for the foreseeable future. This is while the kennel is being established and resources gathered to establish the foundations for long term success. But when finally taken up, theses option will introduce long term stability into our business. This will be achieved by diversifying away as much risk as we can from our core business and further mitigating those risk that remain

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Threats

One of the biggest threats to our kennel is the falling number of local residents taking holidays abroad. Taking holidays elsewhere in France means people are increasingly able to take their pets with them on their holidays. This reduces the size of our market which will increase the level of competition we’ll face while becoming established. This will remain a threat during the short to medium term, but will start to fall back again over the long term as the economy recovers.

Another threat is the continued use of substitutes for our service. This includes pet owners having their friends or family care for their pets while they are away. This is usually at a must more

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reduced price than what we can offer, if not for free. In this case, we will have to ensure the quality of our service is as such that we can attract these customers and demand the higher prices we charge for our services.

There is also the threat of new entrants entering our market due to the low barriers of entry. This means that there is the continued threat of new competitors entering the market if we fail to meet the needs and expectations of our customers. Therefore, we must ensure we maintain high standards of practice ensuring long term customer loyalty and retention.

Marketing Analysis

The Four P’s

PriceWe have taken the decision not to compete in regards to price. This is because of the

association our customers will make between being cheap and having a poor quality service. This will damage our kennels long term reputation which is fundamental to the success of our business. Therefore, our pricing strategy will be in line with that of our competitors.

A price breakdown is show below.

Year Price Variable Cost Fixed Costs Profit (Per Unit)

2013 € 15.00 € 3.22 € 12.31 -€ 0.522014 € 15.00 € 3.22 € 10.07 € 1.71

2015 € 15.00 € 3.22 € 9.39 € 2.40

2016 € 15.00 € 3.22 € 9.39 € 2.39

2017 € 15.00 € 3.22 € 9.39 € 2.39

As we can see, while we build up our sales over our first three years of operating, our fixed costs per unit will begin to decline. This will see our profit margins increase over the three years. However, these profit margins will initially be negative in our first year of trading, resulting in a loss at the end of the year. By the end of our third year, our profit margin per unit will level out at around €2.40 if predicted results are achieved.

ProductOur product will be the main area in which we compete. This will involve offering services

above and beyond those of our competitors.

As previously stated, as our premises are located outside the centre of Nice, we can afford premises with a larger outside area. This gives us the opportunity to offer the dogs in our care an area

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to exercise and make use of the fresh air. This will help ensure the long term health of our dogs which our competitors in the centre of Nice have limited access to. This will save director time which they would normally spend walking the dogs. This time can then be used to ensure the effective running of the business.

We also offer dog owners access to webcams that can be used to ensure the well-being of their dogs while in our care. This improves our corporate accountability and helps in dealing with our kennels initial lack of reputation. This again goes above what our competitor’s offer which gives us a distinct competitive advantage and unique selling point. However, this does increase our costs which are why we are unable to offer lower prices than our competitors.

However, if we ever do perform below expectations, our customers will be fully aware of it and it will damage our long term reputation. But if we perform well, this will significantly improve our kennels standing in the market. This is why we have appointed a Director of Communications as well as a Chief Legal Officer who will ensure we perform above customer expectations.

PlaceAs stated, we will be located 20 minutes outside of Nice. This puts us at a disadvantage to our

competitors who are located closer in the centre of Nice. We took the decision to locate here in order to differentiate ourselves from our competitors. This will see us focusing on having the right environment for our dogs rather than on proximately to the customer. This will differentiate us from our main competitors. This is why will have incorporate the use of webcams into our business, to help dog owners feel “closer” to their dogs. (Rent In France, 2012)(Google Maps, 2012)

The below map shows the location of our kennel in respect to some of our competitors;

*Hotel Canine is identified by the white circle and each of the yellow tags represents a competitor (Pages Jaunes, 2012)

This map clearly shows how different our kennel is in relation to the environment it is located in. However, this also means we need to appeal to customers over a wider area in order to be successful.

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PromotionWe have developed a Gantt chart which sets out precisely how we intend to run our

promotional campaign during our first year of trading. It shows that the backbone of our promotional activities will focus on Pages Jaunes, a free form of advertising and Google Adwords. (Pages Jaunes, 2012)(Google Adwords, 2012)

This dual approach will ensure we have as wide a customer base as we can. Use of online forums will also facilitate the “word of mouth” we need to ensure the success of our business. This will allow customers to provide feedback anonymously allowing us to continuously improve our service. This is why we have appointed both, a Director of Communications and Chief Marketing Officer in order to maintain a positive public perception of our kennel.

We also make use of posters and leaflets which will be updated and redistributed quarterly. This is to ensure our kennel is regularly publicised to the local audience, growing our core customer base. This will help ensure the long term success of our business. These will be distributed in both Nice and the surrounding towns such as St Laurent du Var, widen our core customer base and improving our long term sustainability.

Marketing Strategy

Our marketing strategy will have a dual approach using traditional paper methods alongside modern medians such as internet advertising. Our kennel will be continually advertised in the Pages Jaunes as well as using the local version of Google Adwords. Using the local versions of these advertising streams will help reduce costs and ensure this advertising reaches our target market. Google Adwords will cost no more than €122 a month and is only be payable based on results. Therefore, if this online advertising does not reach our target market, no fee will be paid. This will ensure that all costs relating to this form of adverting is used effectively with no unnecessary waste. Again, this will ensure our kennels long term sustainability ensuring all company expenditure is well and effectively utilised. (Pages Jaunes, 2012)(Google Adwords, 2012)

We will also encourage customers to write reviews on and promote our website. These reviews will be aimed at overcoming our lack of reputation. Like we stated earlier, our companies long term success will be based on the positive “word of mouth” of our customers in order to promote our kennel. Our online reviews will form a part of this “word of mouth”.

Customers will also be able to use our website to access our webcam service. This will allow them to see how their dogs our doing. This will help us build trust with our customers and ensure corporate accountability. These webcams will be password protected with the passwords being updated for every new customer. This is to ensure the privacy of our customers and forms part of our policy concerning corporate accountability.

Alongside these core advertising mediums, we’ll have other forms of advertising. These will include leaflets, posters and business cards. Our leaflets and posters will be reproduced and redistributed on a quarterly basis. This is while our company directors will continue to use our business cards throughout the year. The aim of these will be to attract new customers to our business, while at the same time, ensuring the retention of our current customers. This will ensure our companies long term sustainability based on high quality service and customer loyalty.

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We’ll have a high intensity marketing campaign when we first start operating and again prior to the winter months when local residents start taking their foreign holidays. Again, this is to ensure all marketing expenditure is value for money with minimal wastage. We have outlined the specifics of our marketing strategy in our companies Gantt chart which is shown in the appendix. This will be adjusted throughout the year as more information is gathered. This is to ensure its long term relevance and reliability.

Our marketing research has shown that the main area of concern for our customers is our lack of reputation. Therefore, our marketing strategy will have to address this issue. This will include using customer reviews and quotes in our advertising campaigns. However, this lack of reputation will only be overcome with time and in gaining the long term loyalty of our customers.

Our Chief Marketing Officer with the aid of our Director of Communications will be charged with implementing our marketing strategy. They will also be responsible for ensuring its relevance to our target market.

Corporate GovernanceLegal Structure

Hotel Canine will be established as a Private Limited Company. This is to help clearly define and structure the business separately from its members. This will also put safety barriers in place in the form of limited liability. This protects our members financially if the company were to meet financial difficulty in the future. On the other hand, it also protects the business if disagreements were to arise between its members or if one member were to leave. (Business Link, 2012a)

The company will be governed in accordance with the articles of incorporation which sets out the rights and responsibilities of the Hotel Canine, its directors and its shareholders. This also provides us with a way of providing further financial and structural stability for the business. This will allow the business to further expand by making it easier to raise additional finance and for bringing in new people into the business. (Triplet & Associes, 2012a) (Business Link, 2012a)

This also allows shareholders to transfer ownership of the kennel which will provide each of them with an exit strategy, if and when they chose to take it. However, we do have a clause in our Articles of Incorporation that states that shareholders (Directors) are not allowed to transfer or sell their shareholdings within the first five years of operating. This is unless permission is given by the Board of Directors. This is to ensure the stability and commitment to the company while it is becoming established. (Business Link, 2012a)

However, we have also considered the disadvantages of establishing the company as a Limited Liability Company. This includes paying tax on both, company profits and staff pay. This double taxation adds an additional cost to the company which we have had to consider in our financial projections. There is also the issue of additional regulations and restrictions on the way we do business. This is an additional bureaucratic burden on the business in regards to having to submit

16


regular financial information to the relevant authorities. This costs us time which can be better spent elsewhere. (Business Link, 2012a) (Business Link, 2012b)

Nonetheless, after taking all of this into account, due to the number of people involved in the business, we have concluded it is more prudent to incorporate the business. This will help ensure the best interest of the company in the long term, irrespective of individual directors. This includes if one director were to leave the company which would risk the company’s existence if it were not incorporated. Simply, incorporating the business will add certainty and stability to the company which is vital in an uncertain economic environment. This will include when it comes to raising additional finance or selling the business at a later date. (Triplet & Associes, 2012a)

Incorporation will require a registration fee of €22 and will last indefinitely. (Companies House, 2012)

Board of Directors

The Board of Directors of Hotel Canine is listed below with their associated roles and responsibilities within the firm. The company is managed in accordance with its Articles of Incorporation which are shown in our appendix.

Chief Finance Officer – Jason Cates

Executive Director with responsibility over the corporate treasury and responsibility for:

Framing of the upcoming annual budget to be delivered to the Board of Directors prior to the start of the financial tax year and setting departmental expenditure limits,

Managing financial risk, financial planning and record keeping, Ensuring relevant accounting standards are met and appointing impartial auditors as required, Staff payroll and joint responsibility with the COO in regards to personnel management.

Chief Operations Officer – Isaac Arjona

Executive Director responsible for the running of the day to day activities of the business including:

Joint responsibility with the CFO in regards to personnel management Maintenance of property and equipment Managing the use of utilities Ensuring the fulfilment of customer requests Managing the care of the animals under the corporation’s responsibility Joint Responsibility with the CLO in ensuring Employment as well as Health and Safety laws

are fully complied with

Director of Communications – Maria Teresa Roman

Executive Director responsible for external corporate relations including:

Communications with suppliers, customers and other external stakeholders

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Joint responsibility with the CMO in the carrying out market research Remaining aware of current marketing strategies

Chief Marketing Officer – Sabrina Borza

Executive Director with responsibility over corporate publicity and marketing including:

The organisation, coordination and design of corporate publicity material Ensuring publicity material complies with local laws Joint responsibility with the DoC in the carrying out market research

Chief Legal Officer – Inmaculada Galvan

Executive Director responsible for ensuring corporate activities are in line with local laws.

Joint responsibility with the COO in regards with employment and health & Safety law Joint responsibility with the CFO in regards to financial law Joint responsibility with the CMO in regards to Marketing law Joint responsibility with the DoC in regards to Consumer law All other corporate legal requirements full under the sole mandate of the CLO

General Director Duties and Operations

The Kennel will be staffed 24 hours a day to ensure the safety and comfort of the dogs in our care. At least two members of staff will be on duty throughout the day between 0800hrs and 0000hrs. This is coupled with the fact that our staff will be living on the 1st floor of our premises (Above the kennel). This will act as a safety net if any problems were to arise. (Rent In France, 2012)

General duties including inventory control and ensuring our dogs are appropriately fed will be assigned by our Chief Operations Officer who will run the day-to-day activities of our business. This is while the Board of Directors as a whole determines long term business strategy in accordance with our Article of Incorporation which is shown in the appendix. (Business Link, 2012a)

Intellectual PropertyHotel Canine has three main areas of intellectual property. These include our brand name, our

company logo as well as the company website domain. These will all need to be appropriately managed and protected in order to protect our company’s reputation. This has been highlighted as being vital to our kennels long term success.

We have researched the application for trademark and copyright protection of both our company name and logo. We have found that, to protect both, it will cost €647 and will last 10 years. The purchase of our website domain will also last 10 years and will cost €95. All of these costs will have to be paid upfront in full when we start the business. (Marcaria, 2012) (Orders 2 Names, 2012)

We had the option of applying for more short-term protection measures such as on an annual basis. This will benefit the company in the short term in regard to cash. However, we found that as long as we can afford these upfront costs, it will prove more cost effective in the long term to apply for this longer term protection. It is behaviour such as this that will make our kennel more viable in the long term, improving our long term profitability.

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Our website will have the domain “.fr”. This is more financially prudent as it is cheaper than having the domain “.com” as well ensuring our website reaches a more appropriate audience. As stated earlier, our main source of advertising will be through the use of “word of mouth”. However, due to the relatively low costs of maintaining a website, we consider it prudent to take advantage of as many advertising streams as we can afford in order to generate business. This again will help our kennel establish a foothold in the local market helping to ensure our long term profitability. Each of these aspects of intellectual property will be appropriately accounted for in our financial statements in regards to amortisation and corporate cash flows. (Orders 2 Names, 2012)

Our Company Website and Logo

Director Remuneration Report

Director Remuneration for Year Ended 31 March 2013

Fixed Remuneration

Executive Directors Cash Salary Rent Income Tax Total

Jason Cates € 2,111.70 € 4,560.00 € 388.30 € 7,060.00

Isaac Arjona € 2,111.70 € 4,560.00 € 388.30 € 7,060.00

Maria Teresa Roman € 2,111.70 € 4,560.00 € 388.30 € 7,060.00

Sabrina Borza € 2,111.70 € 4,560.00 € 388.30 € 7,060.00

Inmaculada Galvan € 2,111.70 € 4,560.00 € 388.30 € 7,060.00

Total € 10,558.50 € 22,800.00 € 1,941.50 € 35,300.00


Fixed Remuneration


Jason Cates € 11,297.52 € 4,560.00 € 922.92 € 16,780.44

Isaac Arjona € 11,297.52 € 4,560.00 € 922.92 € 16,780.44


Sabrina Borza € 11,297.52 € 4,560.00 € 922.92 € 16,780.44


Total € 56,487.58 € 22,800.00 € 4,614.62 € 83,902.20


Fixed Remuneration


Jason Cates € 11,297.52 € 4,560.00 € 922.92 € 16,780.44

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“Hotelcanine.fr”


Isaac Arjona € 11,297.52 € 4,560.00 € 922.92 € 16,780.44


Sabrina Borza € 11,297.52 € 4,560.00 € 922.92 € 16,780.44


Total € 56,487.58 € 22,800.00 € 4,614.62 € 83,902.20

Director Share Options Report

Executive Share Options for Year Ended 31 March 2013Executive Directors Date of Grant Date Exercisable No. of Options Price TotalJason Cates 01.04.2012 31.03.2017 7000 € 0.81 € 5,649.93Isaac Arjona 01.04.2012 31.03.2017 7000 € 0.81 € 5,649.93Maria Teresa Roman 01.04.2012 31.03.2017 7000 € 0.81 € 5,649.93Sabrina Borza 01.04.2012 31.03.2017 7000 € 0.81 € 5,649.93Inmaculada Galvan 01.04.2012 31.03.2017 7000 € 0.81 € 5,649.93

Total 35000 € 28,249.66


Total 35000 € 29,170.63

Executive Share Options for Year Ended 31 March 2015Executive Directors Date of Grant Date Exercisable No. of Options Price TotalJason Cates 01.04.2012 31.03.2017 7000 € 0.89 € 6,235.47

Isaac Arjona 01.04.2012 31.03.2017 7000 € 0.89 € 6,235.47Maria Teresa Roman 01.04.2012 31.03.2017 7000 € 0.89 € 6,235.47Sabrina Borza 01.04.2012 31.03.2017 7000 € 0.89 € 6,235.47Inmaculada Galvan 01.04.2012 31.03.2017 7000 € 0.89 € 6,235.47

Total 35000 € 31,177.35

Executive Share Options for Year Ended 31 March 2016Executive Directors Date of Grant Date Exercisable No. of Options Price Total

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Jason Cates 01.04.2012 31.03.2017 7000 € 0.93 € 6,517.63

Isaac Arjona 01.04.2012 31.03.2017 7000 € 0.93 € 6,517.63Maria Teresa Roman 01.04.2012 31.03.2017 7000 € 0.93 € 6,517.63Sabrina Borza 01.04.2012 31.03.2017 7000 € 0.93 € 6,517.63Inmaculada Galvan 01.04.2012 31.03.2017 7000 € 0.93 € 6,517.63

Total 35000 € 32,588.17


Total 35000 € 33,591.34

Financial Analysis

Sales

During the first 18 months of trading, our kennel will see its sales continue to grow. This growth will be more significant during the winter season when the demand for our services is likely to be higher. However, this means are our sales growth will likely be more sluggish during the summer months. Our sales will start to level out towards the end of our second year of trading reaching a peak of 22 dogs during the winter of 2013.

Once sales have levelled out, they will fluctuate based on seasonality. Our market research suggests that demand for our services will likely be higher during the winter months. This is because a significant number of the local population work in the tourism industry which is more active during the summer months. As such, people are more likely to take their foreign breaks during the winter season. This will a see boost in demand for our service during the winter months. This growth and seasonal fluxuation in the demand for our services is shown in the graph below.

Apr-12Jul-1

2

Oct-12

Jan-13

Apr-13Jul-1

3

Oct-13

Jan-14

Apr-14Jul-1

4

Oct-14

Jan-15

Apr-15Jul-1

5

Oct-15

Jan-16

Apr-16Jul-1

6

Oct-16

Jan-17

0

5

10

15

20

25

Dogs Per Day

*The forecast is based on our market research and Census information regarding seasonality and aggregate demand.

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This will see our revenue grow steadily over our first two to three year of trading levelling off at approximately €153k in 2015.

2013 2014 2015 2016 2017€ -

€ 20,000 € 40,000 € 60,000 € 80,000

€ 100,000 € 120,000 € 140,000 € 160,000 € 180,000

€ 61,855

€ 149,160 € 153,210 € 153,210 € 153,210

Revenue

Net Profit for the Year

Due to the need to build up our customer base over a number of years, we are currently predicting a loss of €2.5k in our first year of trading. This is expected to turn into a profit of €14.5k in our second year of trading and approximately €21k every year thereafter. Slight variances in our net profit will be caused by financial items such as property depreciation.

2013 2014 2015 2016 2017

-€ 5,000.00

€ -

€ 5,000.00

€ 10,000.00

€ 15,000.00

€ 20,000.00

€ 25,000.00

-€ 2,426

€ 14,643

€ 21,241 € 21,228 € 21,211

Net Profit for the Year

Profit per share is shown below:

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2013 2014 2015 2016 2017

-€ 0.20

-€ 0.10

€ -

€ 0.10

€ 0.20

€ 0.30

€ 0.40

€ 0.50

€ 0.60

€ 0.70

-€ 0.07

€ 0.42

€ 0.61 € 0.61 € 0.61

Net Profit Per Share

Finance Costs

Based on our financial forecasts, we are predicting a need of two separate loans of €4000 each. The first of these will be needed in our first year of trading, the other in our second year. HSBC has quoted us an interest rate of 6.9% and we intend to repay each of the loans in full by the end of the financial year we receive them. This equates to a finance cost of €276 in each of our first two years of trading. (HSBC, 2012)

Corporation Tax

The French tax system requires businesses making up to €38,120 as year to pay annual tax rate of 15% a year. Due to our losses in our first year, there will be no tax liabilities expected of us. However, from our 2nd year onwards, we’ll be required to pay this 15% tax rate. Based upon current forecasts, this should equate to €2.6K in the financial year 2014/2015 and €3.7k every year thereafter. French tax law requires companies to pay their tax liabilities quarterly throughout the year in which they are incurred. These tax payments are based on forecasted profit with adjustments being made in the final tax payment once actual profit is known. The system allows for flexibility for small firms allowing them to make a one off payment nine months after the end of financial year. (France Accountants, 2012)

We have taken the decision not to take advantage of this flexibility in the system at the present time. This is to get the business used to the general tax system for if and when we no longer qualify for this flexible tax system. This also spreads out the payment period over a longer period of time ensuring a more stable cash flow in the long term. (France Accountants, 2012)

Cash Flow and Balance Sheet

As stated previously, we will require two loans of €4000 in our first two years of trading. However, as we intend to repay both of these loans before the end of our financial year, neither loan will appear in our Statements of Financial Position (Balance Sheet) at the end of the year. These loans are required due to the need to build up a core customer base for our kennel over a period of time. This means the cash flow in our first two years of trading is not as strong as we would like it to be.

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Therefore, we require further funding to keep our cash flow at adequate level. This will see our minimum cash balance reaching €3277.80 in August 2014. This provides us with an adequate safety buffer for if we perform below expectations or additional costs are incurred. These loan repayments also act as a tax shield saving the company money in the long term.

We predict negative cash generation in our first year of trading with cash levels decreasing by €900. However, we predict this to remain positive every year thereafter, ranging from €670 to €1883 a year in terms of cash generated. However, the majority this cash will be generated in the second half of each financial year with cash levels decreasing during the first half. This is due to the high level of seasonality in our industry.

Apr-

12Ju

l-12

Oct

-12

Jan-

13Ap

r-13

Jul-1

3O

ct-1

3Ja

n-14

Apr-

14Ju

l-14

Oct

-14

Jan-

15Ap

r-15

Jul-1

5O

ct-1

5Ja

n-16

Apr-

16Ju

l-16

Oct

-16

Jan-

17

€0.00

€10,000.00

€20,000.00

Cash and Cash Equivalents

Capital Expenditure

The bulk of our capital expenditure will take place in the months prior to the opening of our kennel. This is in order to get the kennel prepared for opening with minimal impact on our customers. Initial capital expenditure is outlined in the investment budget which is shown in the appendix. This shows capital expenditure in the first year totalling €19.2k. However, we have room in our cash flow as discussed if additional investment is required. We will also set aside €1500 a year for repairs and/or replacement of property and equipment.

Share Value

Share value will fall significantly in our first year of trading as we set out to establish the kennel. This will see share value fall from €1 each at time of issue to €0.81 in March 2013. However, share value will then steadily rise in the years that follow reaching €0.96 in March 2017. This is still below the €1 issue price, but represents a strong fundamental performance at our kennel. Our company’s Articles of Incorporation state that shareholders will not be able to sell their shares prior to April 2017 without the approval of the Board of Directors. In this case, the original company shareholders and the Board of Directors are one in the same. This enshrines our long-term commitment to the company, both as shareholders as well as company directors.

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2013 2014 2015 2016 2017€ 0.70

€ 0.75

€ 0.80

€ 0.85

€ 0.90

€ 0.95

€ 1.00

€ 0.81 € 0.83

€ 0.89

€ 0.93 € 0.96

Share Value

*Share value is based on the “balance sheet method” of corporate valuation

Departmental Budgets

On an annual basis, the Chief Financial Officer will deliver a budget outlining departmental spending over the next five years. This will act as a benchmark in relation to corporate performance and will act as a constraint on excessive company spending. This will help enshrine financial discipline within company and will encourage long-term stability.

These budgets will be adjusted throughout the year as new and more accurate information becomes available. This will ensure departmental budgets remain reliable throughout the year and remain subject to due diligence by each of the departmental officers. These will also be used to help evaluate director performance ensuring they perform at the level expected of them.

The departmental budget for the next five years is shown in the graph below outlining the allocated budgets for each of the kennels 4 departments: Operations, Legal, Marketing and Finance.

2013 2014 2015 2016 2017€ -

€ 20,000

€ 40,000

€ 60,000

€ 80,000

€ 100,000

€ 120,000

€ 140,000

Department Budgets

LegalMarketingOperationsFinance

These annual budgets will consider each of the company’s main financial documents including cash flow, income statement and statement of financial position (balance sheet). In the short term, these budgets will focus on company growth, maintaining of appropriate levels of cash and

25


managing the low customer confidence in our business. In the medium term, our main area of concern will be ensuring corporate stability and preparing for future growth. Then in the long term, these budgets will be preparing the business for more significant expansions including the opening of a second premises’, most likely in another city where the demand will support such expansion.

Debt Management

As stated before, we are hoping to obtain two individual loans of €4000, one in each of our first two years of operating. We expect to repay each of these loans in full before the end of the financial year, taking approximately 8 months. As a result, neither of these loans will appear in our Statement of Financial Position (Balance Sheet) at the end of the year.

Our Monthly debt level is shown in the graph below.

Apr-12

Jun-12

Aug-12

Oct-12

Dec-12

Feb-13

Apr-13

Jun-13

Aug-13

Oct-13

Dec-13

Feb-14

€ 0.00€ 500.00

€ 1,000.00€ 1,500.00€ 2,000.00€ 2,500.00€ 3,000.00€ 3,500.00€ 4,000.00

Monthly Debt Level

Break Even Analysis

Our break-even analysis for the next 5 years is shown in the graph below. We have then broken down each of the break-even analyses for our first three years which are also shown below.

2013 2014 2015 2016 201705

10152025303540

12

23 22 22 22

11

35 36 36 36

Break Even AnalysisDog Days and Other Equivalents

Break Even Sales

As you can see, our break-even point in our first year of trading will be relatively low compared to later years. In our first year, we will need an average of 12 dogs in our kennel or dog

26


equivalents from the other parts of our business at any one point throughout the year. It will then rise significantly in our second year as we begin to pay ourselves a more sustainable salary to live on. It will then fall back again in our third year once we have fully repaid our loan capital to our creditors.

Our first year will be the only year in which we fail to meet this break-even point. This will see us make a loss of €2.4k. However, we have appropriately planned and prepared ourselves to sustain this initial loss including the issuing of the two loans in which we are asking for in this business plan. This is due, as stated before, on the need to build up our kennels reputation in the local area over a period of time. In later years, once we have built up this reputation, we predict we’ll exceed these break-even points each and every year, starting in our second year.

The table below illustrates more precisely the break-even points of our business and compares them to our actual results at the end of the year. As shown, our main costs will be those of fixed costs. This is because our business is more service based than manufacturing based. These fixed costs will mainly consist of the staffing costs we’ll need to pay ourselves when running the kennel. Our variable costs include the food we’ll need to provide our dogs while they are in our care as well as the inventory regarding our pet store and grooming service. Utilities such as water, heating and electricity are regarded as fixed costs due to the general stability of these costs over the long term.

Break Even Summary

Year Break Even Sales Difference Total Variable Cost £ 3.22

2013 12 11 -1 Sale Price £ 15.00

2014 23 35 11 Contribution £ 11.78

2015 22 36 13 Mark Up 366%

2016 22 36 13 Gross Profit Margin 79%

2017 22 36 13

0 2 5 7 9 12 14 17 19 21 24 26

€ -

€ 20,000

€ 40,000

€ 60,000

€ 80,000

€ 100,000

€ 120,000

€ 140,000

€ 160,000

Break Even Analysis for 1st Year

Fixed Costs Variable Costs Total Costs Revenue

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0 2 5 7 9 12 14 17 19 21 24 26

€ -

€ 20,000

€ 40,000

€ 60,000

€ 80,000

€ 100,000

€ 120,000

€ 140,000

€ 160,000

Break Even Analysis for 2nd Year


0 4 9 13 18 22 27 31 36 40 45 49

€ -

€ 50,000

€ 100,000

€ 150,000

€ 200,000

€ 250,000

€ 300,000

Break Even Analysis for 3rd Year


Growth & Harvest Strategy, Critical Risks and Milestones

Growth and Harvest StrategyOur future strategy would consist of natural growth and diversification into other animal care

services. This will include widening the geographical area in which we operate and expanding the range of services we offer.

Acquisition of new propertyOur future strategy will include looking for a new property in addition to our current

premises. It will be hoped that this new facility will be owned rather than rented, ensuring long term value for money. This secondary facility will likely be located in another city such as Cannes. This will widen the geographical area in which we operate and help ensure our long term sustainability.

Cat sittingThere is also an option of widening the range of services we provide. This may include

widening the range of animals we offer our kennel service to. As stated, we may need to acquire new

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facilities in order to accommodate this greater number of animals. This will also include maintaining appropriate distance between different breeds of animal such as dogs and cats, ensuring health and wellbeing for our animals. We will also divide the gardens in to separate zones as appropriate ensuring this distance is maintained. Our other animals will receive the same level of care and service as our dogs. This will include all our grooming, feeding and training services. As such, our store will increase its product range, offering all kinds of animal food and accessories. This strategy will allow us to broaden both our target market and our range of revenue streams.

OutsourcingOutsourcing will protect us from future instability, allowing us to more easily reduce costs in

times of declining business activity. This may be the case of our grooming service, animal training or any future veterinarian service. This option will be carried out only if the cost of outsourcing is lower than providing the service ourselves. Our mission will be to provide the customer with as wide a range of services as possible ensuring long term profitability for our company as a whole.

Service in the house’s customerWe can also extend our dog care service into our customers’ homes. This will increase the

number of dogs we can take into care. We can also provide a customized service where an employee will visit the customer’s home as required. This will include similar services than those in our kennel like walks, grooming and feeding. The price of this service will be higher than our kennel service to cover the transport expenses and additional time needed to offer this service.

Veterinary serviceHaving all our services centred in one location and can save our customers significant

amounts of time. This includes travelling to buy food or to take their pets to the vets. The customer can then leave the dog on our care knowing that if their pet falls ill, they will receive high standards of veterinary care. We will hire a qualified vet to offer such a service. Due to the costs involved, such a strategy will not be utilised until our company has grown enough to afford such a service. Our hope is that we will be able to offer this veterinary service at a price in line with local demand.Critical Risks

As previously stated, one of the major risks relating to our business is our failure to build a positive reputation within the first year of operating. By providing our customers with as much information as possible, we mitigate some of the risk this places on our kennels future profitability. Also with the webcam facility attached to our service, we provide our customers with greater confidence in the services we provide.

The declining number of people taking foreign trips is also a risk to the long term success of our business. Although airlines at Nice airport are continuing to offer cheap flight destinations, we may need to broaden our core customer base to mitigate this risk. This will include appealing to those who are travelling locally, but where dogs are not permitted. This may include weekend’s away such as for weddings and business trips.

The distance of the kennel from the centre of Nice may be off putting for a number of potential customers. However, this location is vital in providing the healthy environment for the animals in our care. If we ensure a high level of communication between our Kennel and the customers, we will be able to mitigate some of the risk associated with this type of strategy. If we deliver clear and precise directions, this will help the customer in regards to travelling to our kennel.

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Customers may have concern in regards to the hygiene of our kennels, both inside and outside. We must reinforce the fact that we are a professional service with high hygiene standards and a clear focus on the health, safety and well-being of our dogs. Again, our webcam service will confirm these high standards of care and ensure our corporate accountability.

We have a high level competition in the area which can sometimes be considered as healthy. This is in regards to ensuring we maintain a high level of service at a reasonable price, ensuring long term corporate efficiency. This will help ensure we maintain a low cost base with minimal wastage. However, this also means our customers have the option to go to an alternative kennel instead of ours. It is vital that we maintain high standards of care over the coming years to ensure long term growth. This will be coupled with smart and effective marketing campaigns, both online and in physical formats. (Pages Jaunes, 2012)

Another risk associated with the running of our kennel includes potential disagreements arising between the Board of Directors. This will have to be carefully managed with the risk carefully considered and mitigated. This is why we have developed clear and concise Articles of Incorporation which set out the rules and guidelines on how to manage the company and resolve potential conflicts. (Business Link, 2012a)

Incorporating our business mitigates much of the financial risk associated with all businesses. This means there is less risk to our directors financial if the business were to collapse. This gives us the room to take greater risks with the company as without risk, there is no reward. This also reduces the risk to our creditors, allowing us to more easily obtain credit. This will go on to reduce the risks in regards to having a short term negative cash flow which can then be supported by additional credit. (Business Link, 2012a)

Milestones

May 2012 – Opening of our first kennel

August 2012 – Issue of first loan

March 2013 – Final repayment on first loan

March 2013 – Company meets minimum wage standards for the first time

July 2013 – Issue of second loan

October 2013 – First tax payment on profits earned

December 2013 – Number of dogs in our kennel reaches its highest peak and begins to level out

February 2014 – Final repayment on second loan

October 2014 – Cash balance reaches its lowest level at €3,277.8

February 2017 – Cash balance reaches its highest level at €15,069.46

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Harvard ReferencingAnimal Holiday (2012) Animal holiday offers two prices. Available at: http://www.animalholiday.com/index.php?page=tarifs [Accessed: 20th March 2012)APPA (2010) APPA National Pet Owners Survey, Statistics and Trends. Available at: www.americanpetproducts.org [Accessed: 13th March 2012)Business Link (2012a) Registration documents and forms. Available at: http://www.businesslink.gov.uk/bdotg/action/detail?itemId=1073789615&r.i=1073789621&r.l1=1073858805&r.l2=1085161962&r.l3=1073865436&r.s=sc&r.t=RESOURCES&type=RESOURCES [Accessed: 7th April 2012)Business Link (2012b) Tax matters of a limited company. Available at: http://www.businesslink.gov.uk/bdotg/action/detail?itemId=1073789619&r.i=1073789599&r.l1=1073858805&r.l2=1085161962&r.l3=1073865436&r.s=sc&r.t=RESOURCES&type=RESOURCES [Accessed: 7th April 2012)City Population (2009) France: Alps-Maritimes. Available at: http://www.citypopulation.de/php/france-alpesmaritimes.php [Accessed: 13th March 2012)Companies House (2012) Companies House prices. Available at: http://www.companieshouse.gov.uk/toolsToHelp/ourPrices.shtml#SEs [Accessed: 7th March 2012)Construct a Quote (2012)We guarantee to beat your Shop Insurance Quotation. Available at: http://www.dogattitude06.com/en/pension/chiens [Accessed: 20th March 2012)

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http://www.dogattitude06.com/en/pension/chiens

http://www.companieshouse.gov.uk/toolsToHelp/ourPrices.shtml#SEs

http://www.citypopulation.de/php/france-alpesmaritimes.php

http://www.businesslink.gov.uk/bdotg/action/detail?itemId=1073789619&r.i=1073789599&r.l1=1073858805&r.l2=1085161962&r.l3=1073865436&r.s=sc&r.t=RESOURCES&type=RESOURCES






http://www.americanpetproducts.org/

http://www.animalholiday.com/index.php?page=tarifs


Croquettes Service (2012) Dry Food Service. Available at: http://www.croquettes-service.com/ [Accessed: 7th April 2012)Degriff Attitude (2012) Wholesale Supplier. Available at: http://www.degriffattitudecom.webself.net/ [Accessed: 7th April 2012)Direct Shop Fittings (2012) Premier Sales Counter. Available at: http://www.directshopfittings.co.uk/counters-and-displays/sales-counters/premier-sales-counter.html [Accessed: 7th April 2012)Dog Attitude (2012) Pensions for dogs, in a family. Available at: http://www.dogattitude06.com/en/pension/chiens [Accessed: 20th March 2012)Eurostat (2012) Statistics – Earnings. Available at: http://epp.eurostat.ec.europa.eu/portal/page/portal/labour_market/earnings [Accessed: 7th April 2012)France Accountants (2012) French Tax Database 2012. Available at http://www.franceaccountants.com/tax.html [Accessed: 20th March 2012)Google Maps (2012) Nice, France. Available at http://maps.google.com/ [Accessed: 7th April 2012)Google Public Data (2012) France Minimum Wage. Available at: http://www.google.com/publicdata/explore?ds=z3ennpo156rm1e_&met=minimum_wage&idim=eu_country:FR&dl=en&hl=en&q=minimum+wage+in+france [Accessed: 7th April 2012)HSBC (2012) Direct taxation. Available at http://www.triplet.com/40-10_corporate/40-70_taxlaw.asp [Accessed: 20th March 2012)Marcaria (2012) Choose your Domain. Available at: http://orders2.names.co.uk/order/step1.php?source=299038&search_source=index_uk060a.html&keyword=hotelcanine&tld=.co.uk [Accessed: 13th April 2012)Orders 2 Names (2012) Trademark Registration Prices. Available at: http://www.marcaria.co.uk/prices-trademark-registration-uk.asp [Accessed: 13th April 2012)Pages Jaunes (2012) Dog near Nice. Available at: http://www.pagesjaunes.fr/trouverlesprofessionnels/rechercheClassique.do?idContext=807811074&portail=PJ [Accessed: 7th March 2012)Pattes et Griffes (2012) Contact and Rates. Available at: https://sites.google.com/site/pattesetgriffesfrance/accueil/contactfr [Accessed: 20th March 2012)PC World (2012) Webcams. Available at: http://www.pcworld.co.uk/gbuk/webcams/728_7098_70107_xx_xx/xx-criteria.html?srcid=198&cmpid=ppc~gg~Generic_-_HW_&_NHW_Dynamic_Ad~Webcams~Generic&mctag=gg_goog_7904&gclid=CPuM68Cx6a8CFWchtAodS0Yr1g [Accessed: 7th April 2012)Rent-In-France (2012) Provencal Studio Rental Property in Salernes. http://www.rent-in-france.co.uk/directory/listing.php?id=1156&fb_source=message#thumb [Accessed: 7th March 2012)Simetric (2012)The cost of the minimum business insurance required by law in the UK. Available at: http://www.simetric.co.uk/insurance/business_insurance/index.htm [Accessed: 7th March 2012)Southwest Shop Fittings (2012a) Shop fittings Products and Supplies. Available at: http://www.southwestshopfittings.co.uk/products.php [Accessed: 7th April 2012)Southwest Systems (2012b) Retail Shop Touch Screen Tills. Available at: http://www.southwestsystemsuk.com/buy-epos-systems/retail-shop-touch-screen-tills.html [Accessed: 7th April 2012)

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http://www.southwestsystemsuk.com/buy-epos-systems/retail-shop-touch-screen-tills.html

http://www.southwestshopfittings.co.uk/products.php

http://www.simetric.co.uk/insurance/business_insurance/index.htm

http://www.rent-in-france.co.uk/directory/listing.php?id=1156&fb_source=message#thumb

http://www.rent-in-france.co.uk/directory/listing.php?id=1156&fb_source=message#thumb

http://www.pcworld.co.uk/gbuk/webcams/728_7098_70107_xx_xx/xx-criteria.html?srcid=198&cmpid=ppc~gg~Generic_-_HW_&_NHW_Dynamic_Ad~Webcams~Generic&mctag=gg_goog_7904&gclid=CPuM68Cx6a8CFWchtAodS0Yr1g



https://sites.google.com/site/pattesetgriffesfrance/accueil/contactfr

http://www.pagesjaunes.fr/trouverlesprofessionnels/rechercheClassique.do?idContext=807811074&portail=PJ

http://www.pagesjaunes.fr/trouverlesprofessionnels/rechercheClassique.do?idContext=807811074&portail=PJ

http://www.marcaria.co.uk/prices-trademark-registration-uk.asp

http://orders2.names.co.uk/order/step1.php?source=299038&search_source=index_uk060a.html&keyword=hotelcanine&tld=.co.uk

http://orders2.names.co.uk/order/step1.php?source=299038&search_source=index_uk060a.html&keyword=hotelcanine&tld=.co.uk

http://www.triplet.com/40-10_corporate/40-70_taxlaw.asp

http://www.triplet.com/40-10_corporate/40-70_taxlaw.asp

http://www.google.com/publicdata/explore?ds=z3ennpo156rm1e_&met=minimum_wage&idim=eu_country:FR&dl=en&hl=en&q=minimum+wage+in+france



http://maps.google.com/

http://www.franceaccountants.com/tax.html

http://epp.eurostat.ec.europa.eu/portal/page/portal/labour_market/earnings

http://www.dogattitude06.com/en/pension/chiens

http://www.directshopfittings.co.uk/counters-and-displays/sales-counters/premier-sales-counter.html

http://www.directshopfittings.co.uk/counters-and-displays/sales-counters/premier-sales-counter.html

http://www.degriffattitudecom.webself.net/

http://www.croquettes-service.com/


Su-Bridge (2012) Arden Grange Adult Salmon. Available at: http://www.su-bridge.co.uk/index.php?main_page=product_info&cPath=1_43_107&products_id=559 [Accessed: 7th April 2012)Triplet & Associes (2012a) Employment status of Directors - a brief overview. Available at: http://www.triplet.com/40-10_corporate/40-21_director.asp [Accessed: 20th March 2012)Triplet & Associes (2012b) Formation of a French Company - a brief overview. Available at: http://www.triplet.com/40-10_corporate/40-20_companylaw.asp [Accessed: 20th March 2012)Virgin Media (2012) Find the perfect broadband package for you. Available at: http://store.virginmedia.com/national-broadband/compare-broadband/index.html [Accessed: 20th March 2012)Vista Print (2012a) Premium Business Cards. Available at: http://www.vistaprint.co.uk/business-cards.aspx?GP=5%2f13%2f2012+4%3a50%3a20+AM&GPS=2443027888&GNF=0&GPLSID=&rd=1 [Accessed: 7th April 2012)Vista Print (2012b) Custom Printed Flyers. Available at: http://www.vistaprint.co.uk/custom-flyers.aspx?pfid=AHG&xnav=flyers_TsrDetails#here [Accessed: 7th April 2012)Vista Print (2012c) Posters. Available at: http://www.vistaprint.co.uk/posters.aspx?txi=157 [Accessed: 7th April 2012)Vitalize Saint Hubert (2012) Shopping Cart. Available at: http://www.vitalize-sainthubert.com/PBSCProduct.asp?ItmID=7226380 [Accessed: 7th April 2012)WSPA (2007) Global Companion Animal Ownership and Trade: Project Summary. Available at: http://www.wspa.org.uk/Images/Pet%20ownership%20and%20trade%20-%20Global%20report_tcm9-10875.pdf [Accessed: 13th March 2012)

SignatoriesWe commend this business plan to Ipag to be laid out before Professor Scalabre on 16th May 2012.

Chief Operations OfficerIsaac Arjona

Chief Finance OfficerJason Cates

Chief Legal OfficerInmaculada Galvan

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http://www.wspa.org.uk/Images/Pet%20ownership%20and%20trade%20-%20Global%20report_tcm9-10875.pdf

http://www.wspa.org.uk/Images/Pet%20ownership%20and%20trade%20-%20Global%20report_tcm9-10875.pdf

http://www.vitalize-sainthubert.com/PBSCProduct.asp?ItmID=7226380

http://www.vistaprint.co.uk/posters.aspx?txi=157

http://www.vistaprint.co.uk/custom-flyers.aspx?pfid=AHG&xnav=flyers_TsrDetails#here

http://www.vistaprint.co.uk/custom-flyers.aspx?pfid=AHG&xnav=flyers_TsrDetails#here

http://www.vistaprint.co.uk/business-cards.aspx?GP=5%2F13%2F2012+4%3A50%3A20+AM&GPS=2443027888&GNF=0&GPLSID=&rd=1

http://www.vistaprint.co.uk/business-cards.aspx?GP=5%2F13%2F2012+4%3A50%3A20+AM&GPS=2443027888&GNF=0&GPLSID=&rd=1

http://store.virginmedia.com/national-broadband/compare-broadband/index.html

http://www.triplet.com/40-10_corporate/40-20_companylaw.asp

http://www.triplet.com/40-10_corporate/40-21_director.asp

http://www.su-bridge.co.uk/index.php?main_page=product_info&cPath=1_43_107&products_id=559

http://www.su-bridge.co.uk/index.php?main_page=product_info&cPath=1_43_107&products_id=559


Director of CommunicationsMaria Teresa Roman

Chief Marketing OfficerSabrina Borza

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Example Business Plan - Service Based Product

Investor Relations

Transcript of Example Business Plan - Service Based Product