Garden Crafts Inc. has created a new product, Sit N’. Caddy. This product will be manufactured and sold in the United States. Garden Crafts Inc. has developed a strategy and mission statement that will incorporate value, quality and conscience into the development mix.
Garden Crafts LLC will be incorporated in Georgia as Chapter S corporation. It will include two stockholders: Rob Kane, Keith Jones, and Keith Jones. The administration offices will have separate facilities for the operation. Starting costs have been calculated with the bulk being donated by Mr. John Houseman who was the owner of Kustom Kabinets. He has also agreed to keep the equipment cost in a private note.
The product, the Sit N’ Caddy, is a combination stool/tool caddy, constructed out of premium grade hardwood. Market research found several similar products in nature but none were wood-based and customizable as much as the Sit N’’ Caddy.
Analysing several markets shows that Home Depot is the biggest national retailer of home and garden supplies. This expanding market has experienced constant growth, showing double digit increases over the past three years. With two-thirds of homeowners spending an average of $532 annually on gardening products, this indicates a highly profitable future for Garden Crafts.
Home Depot was our first target for sales. Therefore, our strategy revolves around the Merchant Home Depot uses as their regional purchaser. Our sales price will be determined by Home Depot’s merchant pricing system. Based on our costs, $20 was the lowest price Home Depot would accept. The projected 11% growth rate is evident in the three-year forecast, which includes a single product with a standard price.
Labor would cost $5 per unit at $10. Instead of paying hourly rates, future employees should be paid a piece rate. A portion of net profits will be paid to the founders by the corporation as dividends. As retained earnings, the rest of the profits are placed in an aggressive-growth mutual account.
Gross sales numbers show an increase in the three-year time period. This is natural given our projection of a 11% growth rate. Although the trend is not identical to that of sales, operating expenses show an increase. This is due to the slight deviation in expenses that were paid in advance during the first year and additional expenses that did not occur after the fifteenth month. The profits from the first year’s production will be sold to Home Depot. There is modest growth in the second year and third years. Check out the Highlights section in this business plan.
Garden Crafts has the potential to make a large return on investment and reap healthy returns. Major factors contributing to this success are the knowledge and skills of the founders, a commitment by Home Depot, uniqueness of design, and a continuous growth in the home and garden market.
1.1 Objectives
Objectives for Garden Crafts:
- Design and build a workshop capable of handling a yearly production of 10,000 units of the Sit N’ Caddy.
- A brochure and specification sheet are needed for the Sit N’ Caddy.
- Increase design efficiency to reduce production costs.
1.2 Mission
Garden Crafts will ensure quality in production and delivery. We will create a business around one product, the Sit N’, a hybrid gardening stool/garden caddy. This will be a priority over our profits and we will provide safe working conditions for all of our employees.
We will be using a variety marketing strategies to reach a broad range of gardening enthusiasts to bring what we believe to be a valuable resource to any gardener’s shed. Garden Crafts will remain open-minded to new methods of production and to changes in our product line. We also welcome custom orders from customers.
We will always remember our profits but not at the expense our customers.
1.3 Keys To Success
Our keys to success are:
- Effective promotions; we can’t sell if we aren’t visible to the gardening enthusiasts.
- Efficiency in production is key to our success.
- Flexibility. This product is made for gardeners. If they have new ideas, we’ll listen.
- Thinking outside of the box; we will not limit ourselves to a single concept.
New opportunities will present themselves and we must watch for, and be open to, them.