Applying the principles learned throughout this course, students will complete a business plan
Applying the principles learned throughout this course, students will complete a business plan for an entrepreneurial opportunity of their choice.
- In classes of 1-5 students the business plan will be completed individually
- In classes of 6 or more students the business plan will be completed in group of 2-4 students.
- Groups will be assigned by faculty. All members must participate to earn points.
- Review the Week 8 discussion forum Power Point requirements
- Include these components in the business plan:
o The team
o The customer and the problem
o The market opportunity
o The solution
o The competitive positioning
o The business model
o Summary financial projections
o The go-to-market strategy
o The funding request
o The exit strategy
Utilize your previous readings and exercises to write your business plan.
Each student will submit a copy of their business plan under the Signature Assignment tab in D2L by the end of week seven.
Expert Answer and Explanation
Business Plan Daycare
Over the years, I have always known that my life’s purpose is to help children grow and develop in a safe environment where they are loved and cared for. As a nurse, I enjoy taking care of children, but I am always in dismay when a child is brought with something they caught in the daycare or experience something that someone should have noticed months ago.
For this reason, I decided to open a daycare catering for children as low as two months and as old as four years. Through it, the children will grow up in a safe and professional environment where every moment of their life will be carefully watched and nurtured, giving them the preparations they need before getting into school (Del Boca, 2015). I decided on this after observing the significant gap in the market concerning the development of children.
Most daycares are unprofessional, and some parents leave their children with nannies only to later report cases of abuse. Additionally, it is essential to understand the children’s growth milestones and ensure they are on the right path. This allows for early intervention if the children have issues with their development, increasing their chances of high-quality life (Felfe & Lalive, 2018).
To create this environment I will include only expert professionals. This includes myself, as a nurse, two former teachers and a security officer. Additionally, to make my business known I will promote it two months prior opening in social media and through community events.
I hope that after opening, the word of mouth will be an important way of marketing. Notably, the business is quite expensive to start with the starting cost amounting to $136,000. However by the second year I hope that the business will break even. The main source of funds will be savings and contribution from friends.
The fact that the company is not yet registered might make it impossible to get grants from the government. My startup will offer professionalism in caring for children, hence ensuring that parents can be at peace and that the children’s affairs are well catered for.
As the business owner, I will be responsible for overseeing that all the activities in the business are closely monitored (Varmuza et al. 2019). I will be the business manager and provide my nursing expertise to the group. Before accepting any child, there will be a quick medical checkup after getting the parent’s consent to understand the child’s development milestones and does not have any contagious illness or needs a doctor’s attention.
Additionally, I will be guiding what should be done in the daycare, and I will always be present to solve any issue that comes up in the case of the operations.
I will also include my neighbor, who is 60 years old but still physically active. She is the most famous person in the neighborhood and is extremely popular with children. Having retired as a teacher a year ago, she is always looking for something to fill her day, and I believe her love for children qualifies her to be an employee in the daycare.
Additionally, she has a lot of experience with infants and usually offers to look after them even for free, especially on weekends. It is always customary to see children waiting for her on her porch as she usually entertains them. She has won the trust of all parents, and she knows how to handle children. By including her in the team, parents will be more comfortable when sending their children to a new daycare.
Another member of the team is Ann, who is a kindergarten teacher. She has a lot of experience dealing with children and has extensive knowledge of handling ethical issues. She has worked as a teacher for many years, and she is known for her kind heart. However, she has been looking to handle a lesser team of children and suggested that she would like to work in a daycare.
I believe that as a startup, the children will benefit from her professionalism as she observes their developmental milestones and introduces them to age-appropriate learning.
I will also have a janitor who will also be the property’s caretaker. Notably, the daycare needs protection and maintenance to ensure all items present do not pose a health hazard to the children. Therefore the janitor, who will also be cleaning the children’s area three times a day, will also be the maintenance person. He will be required to ensure that the environment is clean and safe for the children.
Lastly, I will have a security officer who will always be at the gate to ensure that everyone accessing the daycare is authorized. The security officer will provide entry to parents dropping off their children and take details of the people permitted to take the children. This will ensure that the children are secure and that no security issues are experienced in the school. With this team, the children will have a safe environment where they can be nurtured and cared for while their parents work.
Customer and the Problem
The daycare clients will be parents and guardians of infants, toddlers, and preschoolers. For quite some time, the clients have complained about the lack of a professional daycare in the area. Although most of them still find daycares to take their children, they prefer to take care of their children on their own , especially after listening to some horror stories involving daycares, such as children being locked accidentally and others being racially profiled. This usually come at a cost of their livelihood or their personal life goals.
My business aims to offer safety and care to children who will not be able to grow in a home environment by creating a home away from home. Through the ethical conduct at the daycare, children will not only be in a safe place but will learn the basics of life, such as the importance of respect in their lives. Currently, most parents are controlled by children, and they usually end up doing what the children want to prevent tantrums. However, in this daycare, we aim to give back the power to parents by guiding them on how to interact with children in a nurturing and satisfying way.
It is also notable that the clients are always worried for their children, and some of them have little knowledge of the growth milestones that their children should achieve. As a result, it takes some time to discover illnesses such as autism and other life conditions that need early interventions. In the business, we will aim to assist parents in understanding their children’s developmental milestones and encourage them to play their part in the development of their children (Schools, 2017).
Other parents find it hard to find daycares willing to take care of their disabled children. While this is sad enough, it is essential to note that all children deserve equal treatment. This daycare offers professionals who can take care of children with disabilities and try to help them develop some skills that will foster their independence.
The Market Opportunity
There are only two other professional daycares in the area where I plan to set up the daycare. The rest are licensed and are in people’s homes (Kuger et al. 2019). This came as an opportunity because even the professional daycares are either too expensive or lack the required items that will foster the children’s development to the maximum.
I also obverse that none of them has a health expert, and therefore parents are still responsible for their children’s health even when they are not in their hands (Megalonidou, 2020). This creates issues because some parents can take time to collect their children hence aggravating any illness, if any. I realized that it is essential that there is a healthcare professional in any daycare who can address any medical emergency before the parents can take over. This can offer the parents comprehensive peace and ensure that the children are well taken care of.
In most cases, parents want real-time updates on their children. I realized that the current daycare only cared for the children and did not do anything extra to ensure that their health was well taken care of. However, I realized that parents might overlook development issues with their children, especially if they do not have enough time to look after them (Otten et al. 2019).
They, therefore, need a daycare that can offer updates on the development of their children. The current daycares are run by nonprofessionals and therefore are not conversant with the milestones that children should have achieved and might fail to notice if a child is only moody or is even sick.
It is also important for the business to be located in a centralized area in the community. When choosing for a location, I will focus on the shopping center as it will not only increase accessibility but it will also ensure that the area is well secured due to its proximity with law enforcement officers. This will greatly reassure parents of their children’s safety in the center.
The solution to the problem is to commence childcare prepared to meet the needs of the children complementary. When starting the business, I will ensure that there is enough land with a building, preferably one without stairs, that can be used for the daycare. After leasing the ground, there will be a playground fit for children below four years. This will include slides, low swings, balance beam, tunnel slides, crawl tunnels, independent tunnels, and cozy climbers (Gubbels et al. 2012).
For the inside, there will be a toddler town, infant maze, learning walls, blocks, balls, and other play items as advised. It will be crucial to ensure that these items’ installation is well supervised and that the children only play with them under supervision. Through the children’s use, they will be well stimulated to grow different talents and develop as needed in their age.
It will also be essential to hire professionals to take care of children. Currently, the unprofessionalism of most providers leads to issues such as racial profiling, lack of records of children’s activities, and careless accidents in the daycare. Through ethical professionals, it will be possible for children to have wholesome days and safe experiences in the daycare (Votruba‐Drzal et al. 2010). It will also be crucial to inform parents about the importance of professional daycares. In this daycare, the parents can access the footage of the day’s activities on request.
The Competitive Positioning
Currently, there are only two official daycares in the area. One of them is new in the business while the other has been in operation for more than ten years. Both of them are still operational means that they will offer competition to the company.
One of the two daycares’ strengths is that they have been in the business for some time and therefore are well known in the market. Currently, any parent looking for daycare is directed to either of the two. Another advantage is that they are all relatively cheap. The average price for every child is $40 a day when they have a packed lunch. However, the price changes if the child is below one year or requires special attention. In my business the price will be slightly higher to cater for the cost of professional workers. Additionally, unlike the current daycares I will provide night services too.
The competitors have weaknesses that will be addressed in our business model. One of the weaknesses is the lack of professionalism. Although the minimum requirements include CDA certification and a first aid certification, most of them rarely put work into getting the certificates and therefore are still helpless in case of an emergency (Oksman et al. 2019).
It is also observable that some teachers behave unethically when interacting with children. Another weakness observed is inadequate materials needed for children’s development. One of the daycares lacks an outside playground, while the other has unattended play items, posing a danger to the children. It is also notable that there is inadequate staff to run the daycare as one of them has a high ratio of children to teachers. This dramatically affects the quality of care the children are receiving. Lastly, the daycares refuse to attend to children with special needs claiming that they do not have the facilities needed.
The Business Model
The business model incorporated is business to consumer. This is the most common business model and also the easiest one to accomplish. The decision made by a consumer to purchase is shorter and less complicated. With this model, the business will require less marketing as compared to business-to-business.
The nature of my business does not permit outsourcing as it deals with service providing to people who must be on the premises. However, the company can outsource a mobile app through which parents can coordinate their picking and dropping off children and can get more information on how to take care of their children. This will, however, be later after the establishment is up and running.
Summary Financial Projections
PROPOSED DAYCARE PROJECT COST SUMMARY
|Proposed Project Cost Summary|
|Capital and Equipment (one time investment)||$ 20,000|
|Human resources (per year)||$ 80,000|
|Physical Space Allocation ** leased one year||$ 20,000|
|Existing facilities and associated services (renovation fee)
|Other Project operating costs per year
Projected Cash flow for daycare for 3 years
|Expenses (as applicable)||Year 1||Year 2||Year 3|
|Total Salary Expense||80,000||240,000||500,000|
|Estimated revenue from all sources including grants, contracts, services, R&D, industry training, etc.||100,000||400,000||1,000,000|
|Expenses Less Revenue||(36,000)||126,500||461,000|
The Go-To-Market Strategy
Given that the company is new, the go-to-market strategy will be extensive advertisement and promotion two months before the opening of the daycare. One way to advertise the daycare is by taking part in community events, including clean-up day and sports day. The director will co-sponsor the event and will be offered a platform to explain the products being offered, increasing awareness of the daycare.
On the family exercise day, the director and other team members will also be active and speak to parents about the importance of professional daycare services. Notably, the business will be set up in one locality, and therefore it only needs to be marketed to people near the company.
The company will also have a website that will be well set up to show the activities being offered and display the facilities to the parents. The website will also provide tips to parents with children eligible for daycare. Moreover, the director will be running the website, and through the live chat section, it will be possible to answer any questions the potential clients have. This will ensure that the company will already know when it opens its doors. After the first month, I believe that the most marketing will be by word of mouth.
The Funding Request
The daycare qualifies for Child Care Strong Grants, but this will be after the company has admitted children to the daycare. The company which will have already been registered will apply for the grants after having several clients. Other sources of funds include personal savings and contributions by friends.
Although I plan to stay in business for the longest time possible, it is necessary to have an exit strategy for the company. I plan to commence the center as a lifelong commitment and one that will be my legacy. In contemporary society, many people are out to harm children, and this daycare will be a haven for children, and I intend for it to remain that way forever. After successfully starting the company. I will create another one in a different location to ensure that we serve as many children as possible.
I plan to leave the business to my daughter, who also has a passion for children. Her dream is to be a kindergarten teacher, and I believe that she can expand the daycare to include a kindergarten. I will therefore run the daycare while grooming her to understand different business strategies and how she can successfully take over the business after I retire. To ensure she understands, she will be working at the daycare for small pay during her free time, which will make me observe her demeanor. Even after I exit the business, I will still be closely watching to ensure its mission and vision are well fulfilled.
After creating a business plan for the daycare, I am confident that I am ready to start the business. Although it requires a lot of effort and sacrifice, I am sure that together with my team, we will be able to provide the best care possible to the children. Additionally, the clients will enjoy peace of mind, and the children will find a peaceful and playful environment that is necessary for their growth. I also hope that the business will break even soon enough and that I will enjoy the returns on the investment.
Customer care and proper care of the children are the business’s primary winning strategies as all stakeholders are sensitive to how children are handled. Through the company, I hope to fulfill my lifelong purpose of taking care of and nurturing children by offering them a safe place where they can live away from home. I also hope that the parents will have insights on how they can promote their children’s development and how they can instill ethical conduct to even their children. When commencing the business, I hope the children will enjoy the place and that they will be able to develop their different talents effectively.
Del Boca, D. (2015). Child care arrangements and labor supply (No. IDB-WP-569). IDB Working Paper Series.
Felfe, C., & Lalive, R. (2018). Does early child care affect children’s development?. Journal of Public Economics, 159, 33-53.
Gubbels, J. S., Van Kann, D. H., & Jansen, M. W. (2012). Play equipment, physical activity opportunities, and children’s activity levels at childcare. Journal of environmental and public health, 2012.
Kuger, S., Marcus, J., & Spiess, C. K. (2019). Day care quality and changes in the home learning environment of children. Education Economics, 27(3), 265-286.
Megalonidou, C. (2020). The quality of early childhood education and care services in Greece. International Journal of Child Care and Education Policy, 14(1), 1-12.
Schools, T. I. (2017). Resource guide. Information booklet for Jefferson County public schools.
Oksman, E., Rosenström, T., Gluschkoff, K., Saarinen, A., Hintsanen, M., Pulkki-Råback, L., … & Keltikangas-Järvinen, L. (2019). Associations between early childcare environment and different aspects of adulthood sociability: The 32-Year Prospective Young Finns Study. Frontiers in psychology, 2060.
Otten, J. J., Bradford, V. A., Stover, B., Hill, H. D., Osborne, C., Getts, K., & Seixas, N. (2019). The culture of health in early care and education: workers’ wages, health, and job characteristics. Health affairs, 38(5), 709-720.
Varmuza, P., Perlman, M., & White, L. A. (2019). Understanding early childhood education and care utilization in Canada: Implications for demand and oversight. International Journal of Child Care and Education Policy, 13(1), 1-22.
Votruba‐Drzal, E., Coley, R. L., Maldonado‐Carreño, C., Li‐Grining, C. P., & Chase‐Lansdale, P. L. (2010). Child care and the development of behavior problems among economically disadvantaged children in middle childhood. Child development, 81(5), 1460-1474.
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Sample of business plan
Here is a sample business plan for a fictional company:
Our company, ABC Clothing, is a retail clothing store that offers a unique selection of trendy and affordable clothing for men and women. Our goal is to provide a shopping experience that is both fun and convenient, with a focus on customer service and quality products. With a prime location in the heart of downtown, we believe that we can establish ourselves as a go-to destination for fashion-forward individuals.
The clothing industry is a highly competitive market with a wide range of options for consumers. However, we believe that our unique selection of clothing, competitive pricing, and exceptional customer service will set us apart from our competitors. Our target market includes individuals aged 18-35, who are fashion-conscious and seek affordable yet trendy clothing options.
Our marketing strategy will include a mix of traditional advertising methods such as print and radio ads, as well as online advertising through social media platforms such as Instagram and Facebook. We will also host fashion events and collaborations with local influencers to increase brand awareness and engagement.
Our store will be located in a prime location in downtown, with a modern and welcoming interior design. We will have a team of experienced and knowledgeable sales associates who will provide exceptional customer service and assist customers with their shopping needs. We will also have an online store to provide a convenient shopping option for our customers.
We project our startup costs to be $250,000, which includes inventory, rent, equipment, and marketing expenses. Our revenue projections for the first year are $500,000, with a projected net profit of $100,000. We plan to reinvest a portion of our profits into expanding our product line and online presence.
Overall, we believe that ABC Clothing has the potential to become a successful and profitable retail clothing store. Our unique selection of clothing, exceptional customer service, and prime location will set us apart from our competitors and establish us as a go-to destination for fashion-forward individuals.
Components of a business plan
A business plan is a document that outlines the goals, strategies, and operations of a business. It serves as a roadmap for the company and provides a detailed plan for achieving its objectives. The key components of a business plan typically include the following:
- Executive Summary: This section gives a brief overview of the entire business plan and summarizes the key points. It highlights the most important aspects of the business, such as the business idea, target market, financial projections, and the management team.
- Business Description: This section provides a more detailed description of the company, including its history, mission statement, and vision. It also includes information about the products or services that the company offers, the target market, and the competition.
- Market Analysis: This section provides an analysis of the industry, the target market, and the competition. It includes data and statistics on the market size, growth potential, and trends. It also includes a competitive analysis of other companies in the industry and an analysis of the company’s strengths, weaknesses, opportunities, and threats.
- Marketing and Sales Strategies: This section outlines the marketing and sales strategies that the company will use to reach its target market and achieve its revenue goals. It includes information on pricing, promotions, advertising, and sales channels.
- Operations and Management: This section outlines the company’s organizational structure, management team, and operational plan. It includes information on the personnel, equipment, and facilities required to run the business. It also includes information on the processes and procedures that the company will use to produce and deliver its products or services.
- Financial Projections: This section includes financial projections for the company, including revenue, expenses, and profits. It includes a detailed analysis of the startup costs, ongoing expenses, and projected revenue streams. It also includes cash flow projections, balance sheets, and income statements.
- Risk Analysis: This section outlines the potential risks and challenges that the company may face in achieving its goals. It includes an analysis of the market and competitive risks, as well as financial and operational risks. It also includes a contingency plan for addressing potential problems.
- Conclusion: This section summarizes the key points of the business plan and outlines the next steps for the company. It may include a call to action, such as a request for funding or a timeline for launching the business.
The purpose of business plan
The purpose of a business plan is to provide a roadmap for the success of a company. It outlines the goals, strategies, and operations of the business, and serves as a tool to communicate with stakeholders, such as investors, lenders, employees, and customers. Below are some specific purposes of a business plan:
- Attract Investors: One of the primary purposes of a business plan is to attract investors. A well-written plan can convince investors that the business has a strong potential for growth and profitability. It outlines the business opportunity, the financial projections, and the management team, which all play a critical role in gaining the trust and confidence of investors.
- Secure Funding: In addition to attracting investors, a business plan can also help the business secure funding from lenders, such as banks or venture capitalists. The plan serves as a formal request for funding, outlining the business’s ability to repay the loan or investment, and demonstrating the potential for profitability.
- Set Goals and Strategies: A business plan serves as a roadmap for the company, outlining its goals and the strategies it will use to achieve them. It helps to prioritize tasks, allocate resources, and track progress towards the goals. A well-written plan can also help the management team identify potential roadblocks and develop contingency plans.
- Define Business Operations: A business plan defines the operations of the business, including the products or services it offers, the target market, and the processes and procedures it will use to produce and deliver those products or services. It helps to ensure that the business has a clear understanding of its operations and can communicate that to its employees and customers.
- Evaluate Progress: Finally, a business plan serves as a tool for evaluating the progress of the company. It allows the management team to compare actual results to the projected results and adjust strategies accordingly. It also helps to ensure that the business stays on track towards its goals and can make necessary changes to improve its performance.