Social Enteprise- Viet Soul ( Clay Art Flowers )

8/11/2019 Social Enteprise- Viet Soul ( Clay Art Flowers )

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1. EXECUTIVE SUMMARY

According to the report Women and Labor market in Asia : Rebalancing for Gender

Equality" by the International Labour Organization (ILO) and the Asian Development Bank

(ADB) announced in 29/4/2013, although Asia is trying to lead the global economy,

rehabilitate the labor market after financial crisis is not kept pace with the global economyrecently. In some developing countries, particularly in East Asia, growth in employment is

recovering, but it still remains some problem concerned about the quality of work.

Specifically, 45% of women in Asia - workforce potential production - remains unexploited,

compared with only 19% in men.

Even before the crisis, the United Nations Committee on Economic and Social Affairs for

Asia and the Pacific forecasts, Asia finance will be reduced between 42 to 47 billion U.S.

dollars per year due to women's limited access access to jobs, losted by 16 to U.S. $ 30

billion per year loss due to gender inequality in education. Although regional economic

growth period 2000 - 2007 reachs 6.2%, much higher than the global average growth of4.2%, the average growth of employment for women only 1.75 - below the world average is

2% general.

The report also pointed out that low-quality jobs is the challenge for the labor force for

women. A large percentage of Asian women is to do the heavy work, low productivity,

vulnerable to low wages in the informal sector. In addition, the unemployment rate of young

women is high and women are still largely regarded like ancillary workforce or secondary

income generation, after men.

Especially the woman in rural area in Vietnam, they contribute more than fifty percent of theproduction force in agriculture, but they have very limited roles to play in household

financial. They have suffered family violence, sexual violence, human trafficking and a lack

of capital to do business.

Our company is a social firm doing business in clay flower art named Viet Soul that helps

poor people especially women and poor laborers.

Viet Soul will provide unique and innovative training cources for women in producing clay

flower, become the distributor of their handmade products and the profit from this business

uses to pay salary, retrain in system and scholarship for chirldens employees.

2. ORGANIZATION OVERVIEW

2.1. Problems and Solutions

Women in rural area play a little role in family and do not have the self-control in family

finance but want to improve their income. Using source from our own fund, supporting from

NGOs, or angle investors, Viet Soul social firm will train them to produce clay flower and

help them sell products in market. The profit from this business uses to pay salary, retrain in

system and scholarship for chirldens employees.


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Viet Soul will provide shop for sell and rent the clay flowers with the main customers are

tourists, embassies, high income earners, the company organizing the event, foreigners living

in Vietnam.

2.2. Vision

Women in rural area or women with poor life condition will have the stable income, improve

their life.

2.3. Mission

Make the better life for women by offering job opportunities to low income families and help

all women in against domestic violence. We also support them in capital if they want to set

up the business.

2.4. Objectives

Long- term objectives: In next 10 years, 80% of poor women in rural areas will have a stable

source of income. Viet Soul will not only purely do business, we also bring the high standard

for women life, stay strong and healthy.

Short-term objectives: In next 3 years, the social firm will go into a state of steady work,

steady income and stable customer source.

2.5. Marketing Analysis

To recognize opportunities for the company, we conduct market research and market analysisbased on the following questions:

- Who are the target customer?

Tourists, embassies, high income earners, the company organizing the event,

foreigners living in Vietnam.

- Why this market is potential and attractive ?

Clay flower art is a new product in Vietnam market, its unique and durable.After a

marketing research, it should be concluded that the potential customers are you, it is

new product so that it has not had a lot of competitors yet and it is a perfect subtitute

product for traditional fresh flower.

It is a high feasibility and can be expanded in many localities.

2.6. Social impact

Profit: Profit from business use to support the stable income for poor women and sallary for

staffs.

Planet: Clay flower use use of materials with environmentally friendly, so will not affect the

issue of environmental pollution

Person: It was many solve social problems. First, it solves the problem of employment for

poor workers, providing them with a fixed source of income, not only that they also have theopportunities to train a new job, and they are also the main source of retraining for new labor.


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3. PRODUCT AND SERVICES

3.1. ProductOur company provide a new unique product in Vietnam market that is clay flower art. Clay

Flower art are handmade with air-dried clay. They are long-lasting, flexible and crack

resistant. These clay flowers are incredible artificial flowers and with a unique elegance that

others cannot achieve. Clay Flower Art is suit for a special occasion or event, as part of a

collection at home, or as a special gift.

The product is made from durable material that is easily looking in everywhere; so it has the

lower price than other flower kinds. We believed that it is a perfect substitute product for

traditional fresh flower.

The company is also committed to making each arrangement unique and custom-designed

based on each customer's needs. All sample arrangements in the store will be available for

purchase.

Moreover our company will select and offer distinctive vases for the discretionary buyer or

for a special occasion, as well as affordable options for routine purchases.

According to the size of clay flower, we will create a unique arrangement to meet anyone's

stated budget. This is some kinds of clay flower which we have now:

Rose Clay Flower

Artificial Clay Flower

Orchid Clay Flower

Blossom Clay Flower

Leen Clay Flower

Lotus Clay Flower

Tulip Clay Flower

Daisy Clay Flower..

3.2 Services:Clay flower art is a new product so that it has not had a lot of competitors yet. By the spirit of

"customer first, keep improving", we are trying development capacity and product. Our

company will develop new models and new color for each season. Also it can make

production according to the customer's samples.

Specially, we provide clay flower to small, medium and large business for rent. We have a

large variety of flower arrangements to choose from, and we can also provide custom

solutions to satisfy any client's requirements. You can rent arrangements for a one time event

or you can choose to rent on a quarterly or monthly basis!


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In addition, clay flower art have a high feasibility and can be expanded in many localities. So,

our target group that we expect are tourists, high income earners, the company organizing the

event, foreigners living in Vietnam. Time of operation is from 8:30 AM to 9:00 PM, Monday

through Sunday. Furthermore, we do ship worldwide.

4.Market analysis summary.

4.1. Strength and weaknesses.

4.1.1 Strength.

Clay flower- New product that Vietnamese people have known since final 2013 is paid more

attention. It looks like normal flower but it can be used a long time (6 months1 year).

Customer - The Company has a large base of customers in their targeted markets.

4.1.2 Weaknesses.

Weaknesses come from the lack of funding to launch operations and expand the business.

4.2. Threat and opportunity.

To recognize opportunities for the company, we conduct market research and market

analysis based on the following questions:

Who are the target customers?Some of them are a high income people as staff in embassies,ministries or some firm.

Why this market is potential and attractive?

+ Vietnam has 90 million people within 1million get high income. It is an expecting number.

More

+ In psychological, most of people in Vietnam like using new product. Moreover, it make

more discovering for other segment.

+ In future, we can expand market share. Customer may include some people income with

medium. Because target customers are some riches, they are always attended by multimedia.

For instance, there are many people willing to buy your product.

+ By this time, in Ha Noi, clay flower does not sell more as other product. So we can avoid

competing from other shop.

What the different features and benefits are the company provide in comparison with other

business?


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+ We make a lot of job for poor women that they have difficult life. Although they do

everything, it does not enough for them to maintain daily necessities. This is an opportunity

to help them getting a job with stable salary.

+ Moreover, our customers are rich persons. They tend to work charity while our company is

held to help poor women. So clay flower will get more supporting from customer.

4.3. Competition Advantage.

Firm has available technology product clay flower. We have some member that they already

make clay flower in center training clay flower in Japan. They make product high quality and

variable about appearance, shape, color. While other shop make clay flower that they have

just produced, they do not have experience. So their product is less attractive as our product.

Clay flower can remain revenue for firm. Other flower as orchids, rose, chamomile, aresold depending each of season. So revenue for this is not stable. While clay flower can

service for customer as soon as they need, clay flower can be more competitive than normal

flower.

5. Strategy and implementation Summary

5.1. Strategy Pyramid

Based on the content in Management course, we arrange our business strategy prudently

follow 3 stages: strategic plan, tactical plan and operational plan.

Firstly, in the most overall way, our team had a meeting and carried out the strategic plan:

Developing a chain-store providing clay-flower, with the main labor-source is woman.

After that, we started in tactical plan: mobilizing the budget, recruiting and training labors,

contacting with suppliers and sponsors, marketing.

The final step in releasing the orient-developing for this business enterprise is the operational

plan- the most specific one: opening stores, setting the schedules and run the business

fluently and other operation activities daily, monthly and so on This all must be done after

finishing the tactics

5.2. Value Proposition

This form of business is totally new and potential in Vietnamese liking. After doing many

researches, we all came to a united decision. This project has a promising future with strongly

development.


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You still make sense from this? We have solid proof for proving that. A high-value and

aesthetic product, bring settled professions for labors. Plus, clay-flower had a truthful beauty

compare with the real ones and they never decayed. The research revealed how surprise and

excited the customers are when they recognize our product were not real flower. They all

wanted to buy, many of them are interested in learning how to make clay-flower forthemselves. Hence, this business had 2 profit sources: from sales and from teaching the

customers

Considered correctly about the prospect of clay-flower in Vietnam, our team drew a detail

strategy: coverer all the aspects such as budget, premises, materials and came to a specific

plan giving to our sponsors. Fortunately, we received optimistic sign, their agreement also.

Therefore, we have all the resources to deploy our firm, and maximize the value this project

brought back: not only financial but also social.

5.3.Marketing Strategy

Marketing always is one of the first and the most critical step in starting- up a business. There

many ways to approach in the marketing analysis, however in this report, researchers want to

express about the marketing strategy follow 4Ps, as we all knew- the marketing mixes: Price,

Place, Promotion and Product. In this case, the expense must be high in initial period for

advertising, setting up the distribution channels, thus we can have an exact number to control

our firm. After accounting, we decided to spend about 90 million VND per year for

marketing program.

5.3.1 Product

As we mentioned above, we have a widely advertising campaign to present clay-flower, getthem closer to our potential customers. Making use of every media mass is a wrong way,

because it costs a huge amount of money and may not pay back the deserve result. Instead of

this, we only concentrate in Phu Nu newspaper, Tiep thi va Gia dinh magazine, a

Facebook fanpage and direct advertise. Indeed, we have target customers are woman,

therefore we focused on this key.

5.3.2 Place(s)

We design this plan for a 3-year of producing. In the 1styear, our main task is promoting a

HQ at Hue Street. This is the place where we display the flower models. After that, we strive

to attain 2 more stores in Thai Ha and Cau Giay street. We predicted precisely 3 zones aroundhave huge taste in clay-flower. Combine with advertising 3 locations, we also care about the

convenience in delivering and transporting of our labors. In expectation, 3 stores can bring

back about 470 million VND per year in average. Gradually, we will introduce these places

widely in newspaper and our website and FB page. Get along with this, we want to decorate 3

store with the most friendly atmosphere to comfort customers who came to visit and order us

directly. Obviously, its a sharp weapon of us to catch the attention.


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5.3.3 Price and Promotion

Our firm guarantees that we have the best price for the best product. This can be indicated in

our marketing activities. Listing out all of special treatment in our advertising videos.

Moreover, we attempt to provide some unique services and discount to our customers.

6. MANAGEMENT AND PERSONEL:

6.1. Manager summary

Organizational structure

Management teamThe management team includes two members of the group of six NEU studentshaving the plan to start-up a social firm doing business in clay flower art in

purpose to help the poor, especially women and poor laborers by using our ownfund, applying the knowledge about the demand of market at the moment, themarketing plan, the high technology to produce high quality products and makinguse of the helping of some stakeholders such as the media, NGOs ... Besides our own fund, the project finance is supported by some NGOs and someangel investors. Hence, one angel investor will also attend in the ManagementBoard and have the express provisions with the business.

6.2. Human resources plan:

We plan to use the labor sources from the countryside and give the priority tothose being poor, especially the poor women. Our workers will be provide with a

Managementteam

Accountingand FinacingStaffs

MarketingStaffs

TechnologicalEngineers

workers


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fixed source of income. They will have the opportunities to train a new job andthey are also the main source of retraining for new labor. The details of personalinformation are in the table below:

No. Position No. of

people

Salary per month Working time

1 Board of Management 3 9.000.000vnd Full-time job

2 Accounting and Financing staffs 2 7.000.000vnd Full-time job

3 Marketing staffs 2 6.500.000vnd Full-time job

4 Workers 8 3.000.000vnd Full-time job

5 Security 1 3.000.000vnd Full-time job

6 Technological engineers 2 8.000.000vnd Full-time job

- The BOM includes two students of the project team and one angel investors havingwide knowledge about doing business. The investor is also the consultant of the

project. Two students attending in the BOM are the ones being well-qualified atAccounting major and having a good basic knowledge of Management.

- The rest of the group will be divided into two department: 2 in the Accountingdepartment and 2 in the Marketing department. They all have the Bachelor degree inAccounting major and two of them have the great enthusiasm on Marketing area.

- Workers of company are the poor, especially women who are facing with the financialproblems. They will be trained to get used to working with the machine system and

high technology. They also take the responsibility to clean their own working areaafter each working days.

- Technological engineers must be the ones who can solve the technical problems aswell as control the producing process and have the ability to give the BOM someadvice about improving the method of produce. They are the young guys havinggraduated from HUST and have the great enthusiasm with the social affairs,especially as which being cared by the project team.

- Securities must be staying alert all the time as well as keeping the whole factory clear.They are hired from the third party.

7. Financial plan

Clay flower art project will be funded from our own fund, support from NGOs, or angle

investors. We realize that it will finance growth primary though cash flow. This means we

will have to grow more slowly than we might like but that no borrowing is necessary.


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7.1 Important Assumptions

The financial plan depends on important assumptions, most of which are shown in the

following table. The key underlying assumptions are

We assume a slow-growth economy, without major recession.

We assume a need for our product and service

We assume a significant customer base such as: tourists, embassies, high income

earners, the company organizing, events, foreign living in Vietnam.

We assume a continued interest in using our products and services by organizations,

customers and businesses in Ha Noi.

General Assumptions

Year 1 Year 2 Year 3

Plan Month 1 2 3

Current Interest Rate 10.00% 10.00% 10.00%

Long-term Interest Rate 10.00% 10.00% 10.00%

Tax Rate 0.00% 0.00% 0.00%

Other 0 0 0

7.2. Start-up invested Capital structure.

Total start-up capital : 56,300,000 VND

Own fun : 32,800,000 VND

Capital invested from others source : 23,500,000 VND

7.3. Apportioning start-up capital

Total start-up capital of the project

Title Units Cost

I. Fixed cost

1. Equipment expenses

Tables 3 300,000


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Tools to make clay

flowers

10 150,000

Flowers baskets 100 1,970,000

Flowerpots 50 2,000,000Clay Press 10 4,500,000

Flowers Shapes

Orchids (size L,

M,S)

4L,3M,5S 750,000

Sunflowers 3L,4M,3S 298,000

Rose 3L,3M,4S 550,000

Mulberry 2L,2M,3S 430,000

Others 15 2,150,000

The veins of all kind of

flowers and leafs

5 200,000

Oil colors 3 420,000

Collapsible chairs 5 250,000

Others 3,000,000

Total Equipmentexpenses

17,418,000

2, Legal expenses and

other expenses

Business registering 200,000

Internet installing

expense

500,000

Name of website 800,000Total Legal expenses

and other expenses

1,500,000

Total fixed cost 18,918,000

II. Working Capital.

Materials 5,000,000

Marketing 10,382,000

Others 3,000,000


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Total working capital 18,382,000

Cash Requirements from

Start-up/ cash balance

19,000,000

Total start-up capital 56,300,000


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7.4. Forecasting in the first 3 years.

7.4.1. Sales Forecast

The sales forecast table is broken down into two main revenue streams :

Buying all kind of clay flowers such as Rose, Sunflower, Orchids, ect - The Company anticipates sales of 9

of operations. Individual printed stem each flower will sell for an average of 50,000 each with a cost of sales

For renting- The Company anticipates sales of 805,500,000 during the first years of operations. Printed

average of 70,000 each with a cost of sales of 25%.

We assume that on March, October and November, Sales will increase about 10% because of Woman Days

Table: Sales Forecast

Sales Forecast

Sales Year 1 Year 2 Year 3

Sales clay flowers 960,000,000 994,000,000 1,006,000,000

For renting 805,000,000 898,900,000 994,680,000

Total sales 1,765,000,000 1,892,900 2,000,680,000

Direct Cost of Sales

Sales clay flowers 240,000,000 248,500,000 251,500,000

For renting 201,250,000 247,425,000 248,670,000

Total direct cost of

sales

441,250,000 498,225,000 500,170,000


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Chart 1 Sales forecast by year

7.4.2. Projected Cash flow

Our company has applied for a grant of 56,300,000. The Company forecast that it'll receive 56,300,000 in ye

We assume having beginning cash balance or Cash Requirements from Start-up capital. The owner will tak

based on the net cash, not determined at this time. The following table displays the Company's cash flow.

Table: Cash Flow


Cash received

Cash from Operations

Cash Sales 1,765,000,000 1,892,900 2,000,680,000

Subtotal Cash from

Operations

1,765,00,000 1,892,900 2,000,680,000

Additional Cash Received 0 0 0

Subtotal Cash Received 1,765,000,000 1,892,900 2,000,680,000

0

500

1000

1500

2000

2500


For renting

Sales clay flowers


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Expenditures Year 1 Year 2 Year 3

Expenditures from

Operations

Cash Spending/pay roll 1,140,000,000 1,140,000,000 1,140,000,000Bill Payments 23,560,000 23,750,000 24,340,000

Subtotal Spent on Operations 1,163,000,000 1,163,750,000 1,164,340,000

Additional Cash Spent 631,800,000 637,000,000 690,000,000

Subtotal Cash Spent 1,794,800,000 1,800,000,000 1,526,340,000

Net Cash Flow (29,800,000) 92,000,000 474,340,000

Beginning cash balance 19,000,000

Cash Balance (10,800,000) 102,800,000 577,140,000

-100

0

100

200

300

400

500

600

700

year 1 year 2 year 3

Cash

Net Cash Flow

Cash Balance


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8. Appendix

Table 1 Salary

No. Position No. of

people

Salary per

month

Working time

1 Board of Management 3 9.000.000vnd Full-time job

2 Accounting and Financing staffs 2 7.000.000vnd Full-time job

3 Marketing staffs 2 6.500.000vnd Full-time job

4Workers 8 3.000.000vnd Full-time job

5 Security 1 3.000.000vnd Full-time job

6 Technological engineers 2 8.000.000vnd Full-time job

Table 2: General Assumptions

-40

-20

0

20

40

60

80

100

120

140

160


Profit year

Profit

Column1


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General Assumptions


Plan Month 1 2 3

Current Interest Rate 10.00% 10.00% 10.00%Long-term Interest Rate 10.00% 10.00% 10.00%

Tax Rate 0.00% 0.00% 0.00%

Other 0 0 0

Table 3: Total start-up capital

Total start-up capital of the project

Title Units Cost

I. Fixed cost

1. Equ ipment expenses

Tables 3 300,000

Tools to make clay flowers 10 150,000

Flowers baskets 100 1,970,000

Flowerpots 50 2,000,000

Clay Press 10 4,500,000

Flowers Shapes


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Orchids (size L, M,S) 4L,3M,5S 750,000

Sunflowers 3L,4M,3S 298,000

Rose 3L,3M,4S 550,000

Mulberry 2L,2M,3S 430,000

Others 15 2,150,000

The veins of all kind of flowers and leafs 5 200,000

Oil colors 3 420,000

Collapsible chairs 5 250,000

Others 3,000,000

Total Equipment expenses 17,418,000

2, Legal expenses and other expenses

Business registering 200,000

Internet installing expense 500,000

Name of website 800,000

Total Legal expenses and other expenses 1,500,000

Total fixed cost 18,918,000

II. Working Capital.

Materials 5,000,000

Marketing 10,382,000

Others 3,000,000

Total working capital 18,382,000

Cash Requirements from Start-up/ cash

balance

19,000,000

Total start-up capital 56,300,000

Table 4: Sale Forecast


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Cash received

Cash from Operations

Cash Sales 1,765,000,000 1,892,900 2,000,680,000

Subtotal Cash from

Operations

1,765,00,000 1,892,900 2,000,680,000

Additional Cash Received 0 0 0

Subtotal Cash Received 1,765,000,000 1,892,900 2,000,680,000

Chart 3: Cash Flow forecast

Table 6: Projected Loss and Profit


-100

0

100

200

300

400

500

600

700

year 1 year 2 year 3

Cash

Net Cash Flow

Cash Balance


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Chart 4: Profit year

7.4.3. Projected profits and losses.

The sales for year 1, 2 and 3 are 1,765,000,000 VND; 1,892,900 VN and 2,000,680,000VND,

respectively. The Company will show a Net Loss of (18,100,000 VND) in year 1, a Net Profit of

146,045,000 VND in year 2 and 109,747,000 VND in year 3 due to the internal expansion of the

Company to launch the marketing, sales and operation efforts needed to take advantage of the

market and growth in the future years. The percentages of the net profit to sales for this period

were (-1,02%), 7,715% and 5,486%, respectively.

The Operating Expenses and Net Profit to Sales for the three year period are affected by the

internal expansion of the Company. Net Profit and Net Profit to Sales Percentage will continue to

rise in future years as the internal expansion and investments in Marketing and Advertising bear

fruit.


Sales 1,765,000,000 1,892,900 2,000,680,000

Direct Cost of Sales 441,250,000 473,225,000 500,170,000

Other Costs of Sales 0 0 0

Total Cost of Sales 1,323,000,000 1,419,675,000 1,500,510,000

Expenses

Production Expenses

Payroll 1,140,000,000 1,140,000,000 1,14000,000

Supplies 4,200,000 3,200,000 3,200,000

Payroll Taxes 11,400,000 10,400,000 11,400,000

Utilities 6,400,000 6,650,000 7,000,000

Internet 3,600,000 3,600,000 3,600,000

Direct material

expenses

Raw materials 84,680,000 110,780,000 130,563,000

Marketing/Promotion 90,820,000 99,000,000 95,000,000

Total Operating

expense

1,341,100,000 1,273,630,000 1,390,763,000


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Net income (18,100,000) 146,045,000 109,747,000

Net income/sales -1,02% 7,715% 5,486%


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Social Enteprise- Viet Soul ( Clay Art Flowers )

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Transcript of Social Enteprise- Viet Soul ( Clay Art Flowers )