D.A.P. Exports is a company that exports parts and lubricants for automobiles to Jamaica, Columbia, Ecuador, and Venezuela. Many of the company’s shipments include both American-made and foreign products, along with some repackaging or labeling.
Latin America, the Caribbean and Mexico are currently home to an industry worth $100 million in auto parts sales. These countries have a large number of automobiles that were built in the 1980’s. Automakers tend to focus on the cars made in the past ten years.
D.A.P. Exports has established a vast network of contacts with customers in the region. James Dunn is the owner of D.A.P Exports. He has over twenty years experience in selling consumer products throughout Latin America and Caribbean. James has been a salesperson for Axiom Food Products, Klymor Manufacturing, and Dudley Food Products.
During those years, James used taxi services in Latin America and the Caribbean. It was during one of those trips that he became aware of the demand for auto parts and auto lubricants. James also discovered the best distribution method for auto products in this region through local taxi firms.
D.A.P. D.A.P. The taxi companies can either repair their vehicles with the parts or sell them to the public. D.A.P Exports is also available to sell auto parts in the region.
1.1 Objectives
D.A.P. Exports’ objectives are as follows:
In the first year of operation, you will see a significant increase in sales.
Attract 100 taxi firms to the region.
During the second year, sales were modestly increased.
1.2 Mission
D.A.P.’s mission is to provide auto parts for all. Exports exists to be the leading auto parts supplier to the taxi companies in the region.
Grutzen Watches (a start-up producer and distributor of watches) is located in New York. Its strategy is to serve the upscale niche markets of the watch industry. It will benefit from the German engineering and manufacturing that went into the production of the watches. This industry offers many opportunities for those who desire stylish and high-quality goods but cannot afford them.
It is the firm’s intention to build and export its products to the United States and to make Grutzen Watches the number one selling European watch in the Western U.S. To do this the company’s long-term goals are to to achieve a 20% market share in the U.S, build brand image and brand equity through marketing, achieve a sustainable 55% profit margin, and eventually produce luxury watches in addition to the initial, moderately-priced line.
The Company
Grutzen Watches (international corporation) is privately owned. Production takes place in Germany and sales and marketing are focused on the United States – California – for the short-term future.
The initial investment is made by three individuals. These include Franz Grutzen’s head of production, Henry Winster’s head of American and sales and market divisions, and Walter Young’s vice president for American division.
The German factory is located at 210 Autoroute 17, Frankfurt, Germany. The factory covers 1,000 square meters. It should be sufficient for the company’s first three years of growth. Henry Winster’s home at 343 Palm Avenue, Los Angeles, California will receive the watches and distribute them. In Los Angeles and San Francisco, the watches will initially be sold in high-end watch shops.
Grutzen’s sales force will consist of Henry Winster and two freelancing sales representatives. Henry Winster in America and Franz Grutzen Germany will communicate to facilitate order processing.
The Products
The brand’s initial product line will feature elegant analog watches featuring sporting characteristics that can be used down to 100 meters. The company plans to release two versions, the “sport†watch and the “night†watch.
Our pricing strategy will be initially to lower our main competitors by 10 percent using a marketing penetration strategy. The pricing strategy will then be modified to be competitive with other major competitors. The price per watch will be approximately $100-$200
The Market
Entry into the high-end watch industry comes at a propitious time. The purchase of European watches at mid-level and high levels has increased 50 percent over the last two years in the U.S., and this trend is expected continue.
One of the most significant trends in recent times is that potential buyers of watches are more likely to spend more because of their increased image appeal. Therefore, a company that can build a substantial brand image in this industry gains a significant competitive advantage. It is the aim of Grutzen to capitalize on its high quality and reasonable price while pursuing the innovative styles necessary for brand building.
Considerations for Financial Planning
The startup costs of the company will amount to $226,000. Owners’#8217 will contribute $171,000. Another $30,000 in funding will consist of short-term borrowing, and the rest will be long-term loans. Rent, research and development, inventory and strong cash accounts will make up the majority of start-up expenses. Grutzen Watches’ Break-even Analysis indicates that they will be able make steady profits in the second and third years.
1.1 Objectives
Grutzen Watches has been voted the best-selling European watch.
To eventually produce luxury watches in addition to the moderately priced line.
To achieve a 5-5% profit margin.
To gain a 20% share of the U.S. market
1.2 Mission
Grutzen Watches manufactures wrist watches in the United States. They are initially located in California. The company will first establish its image as a quality brand and then begin to sell luxury watches with higher profits.
1.3 Keys to Success
To succeed Grutzen Watches must:
You can build and sell high quality products.
Achieve 100% customer satisfaction.
Marketing helps to establish brand image, brand equity, and build brand awareness.
Silvera & Sons is a Brazilian coffee bean producer that prepares green Arabica beans for export to American specialty roasters. We also sell the beans to Brazilian wholesalers. We will increase production capacity from 72,000/60kg to 120-160,000/60kg annually. Our coffee stands out from that of the competition. The top five percent of Arabica beans available on the market are prepared by us. Customers love this product because it allows them to differentiate themselves from specialty roasters. In six years, our customers have demanded more coffee than we can supply. We have been forced to deny requests for larger shipments.
With sales exceeding ($BRL), we predict a 30% growth rate in the first year. Based on the current price for coffee, the plant will operate at full capacity. In year three, the plant should be able to generate excellent profits of ($BRL). Positive indicators have been received from importers that this additional quantity of beans will eventually be sold.
We have the keys to success
Establishing and maintaining business relationships with American importers and Brazilian wholesalers and brokers of coffee.
Three years operation to bring the new facility up to its maximum potential production.
Our profit margin will increase with the improved technology used in the new facility.
Through targeted communications, we communicate effectively to customers and potential customers our position as a distinguished provider of Arabica beans of the highest quality in the world.
1.1 Objectives
Silvera & Sons’s goals:
Production and sales will increase from 78,000/60kg to about 100,000/60kg annually in the first year. The facility will reach maximum capacity of 120,000/60kg bags by the third year.
Ensure that you have a significant increase in sales within the first year.
Establish strategic relations with 10-15 American importers in Los Angeles/San Francisco/Seattle.
In the next three-years, increase gross margins
1.2 Mission
Silvera & Sons Ltda aims to provide coffee enthusiasts and importers with the best quality products at the most affordable price. We value the relationships we have with our customers, both current and future, and want to show our appreciation by providing exceptional, guaranteed product quality, personalized service, and efficient delivery. Honesty and responsible business will reflect our commitment to Brazil’s customers.
1.3 Keys for Success
The keys to success for Silvera & Sons are:
Establishing and maintaining relationships with American importers as well as Brazilian coffee brokers, wholesalers and distributors.
In three years, bring the new facility to maximum productivity.
We are able to increase our profit margins through the use of new technology in our facility.
Communicate effectively to potential and current customers our position as a distinguished provider of high quality Arabica beans around the globe.
Visigoth Imports will provide complete import/export brokerage services including purchase contracts, shipping, warehousing, and delivery scheduling. The company will concentrate its efforts on special and culture imports from Germany or Scandinavia to Leavenworth. Visigoth provides trade consultation services for new-established farms under the Puget Consumers Co-op’’s Farmland Fund program.
Market
Visigoth’s focus will be on two specific clients. They are the Leavenworth, Washington-based gift shops, and the Puget Consumers Co-op (PCC) farmers. We have exclusive contracts or endorsements for both market segments. This puts us in a unique position that can serve these niche companies and their needs.
This market is expected to show excellent profitability, especially the import section. Leavenworth receives more than one million tourists each year. While we expect the co-op to have a slower rate of profitability over the first five years, it will continue to grow steadily.
Competition
Competition includes all potential importing firms that serve small enterprises such as farms and specialty gift shops. Practically, this means that we will not compete against the largest import/export businesses such as Eagle Distributing, Fisher-Mills, or other large, national companies. Many other companies tend not to be regionally oriented. The foreign trade industry has a high degree of fragmentation. It is composed of many small companies that mainly deal with small businesses, as well as a handful large companies that are looking for the largest contracts from companies like Microsoft, GM, and others. The industry is very competitive. Our niche strategy is designed to prevent competition and its drawbacks like price wars, etc.
Why Us?
We are the preferred importer for Leavenworth’s unique tourist area. Visigoth is aware that Leavenworth’s many tourists have unique needs and that Leavenworth’s custom-made gifts are a must-have for its restaurants and import shops. Visigoth Imports recognizes that the farms that are part of the PCC farmland funding initiative have much higher prices than others and must be exported at a price that makes them a profitable company. Visigoth Imports have a combined 35-years of experience in the import/export trade. Our aim is to develop long-term relationships and build loyalty with clients by delivering their products seamlessly.
Expectations
Forecast
Most of the company’s liabilities will come from outside private investors and management investment, however, we have obtained current borrowing from Bank of America Commercial Investments, the principal to be paid off in two years. A long-term loan through Charter Bank of Nieurich will be paid off in ten years.
The company expects profitability by year 2 and does NOT anticipate any cash flow problems. We expect that about 3,500 units per month will guarantee a break-even point.