leftbottom60 Gadwal RoadMerebank, Durban 4052p. 0314669386f. [email protected]
comwww.bitsnpcs.co.za100000060 Gadwal RoadMerebank, Durban 4052p. 0314669386f. [email protected]
bitsnpcs.co.zaleftcenterOnline Computer Shop 850000Online Computer Shop Table of Contents TOC o “1-2”
“2-2” h z u Executive Summary2ObjectivesMission StatementKeys to SuccessGeneral Company Description5Opportunity 7Strategy 10Business Model 11Team Management 12Marketing Plan 13Operational Plan 16Financial Plan17Conclusion 22Reference23INTRODUCTIONBusiness Profile Bits n PCs was founded in January 2017 by myself Pretesh Indrason, who has the knowledge and understanding of the computer industry along with its products and what needs to be offered. The company is a Sole Proprietary ownership The company currently focuses on selling computer parts and accessories as well as other electronic devices.The competitive advantage will be the aggressive pricing strategy.The company currently operates on e-commerce platforms such as Bid or Buy to trade goods to customers. We have approximately 1 years of trading. The current limitations are that the business operates under e-commerce platforms and does not have a name for itself in the market and wishes to establish one.
It’s now time for the business to grow and expand and set foot into the market and make a name for itself with no middle man.Unique Characteristics The company is unique because it delivers a wide range of electronics and has a huge inventory of items compared to other online computer stores.The company has an import permit from the International Trade Administration Commission (ITAC) so goods are received directly from the supplier. The company has stock locally for quicker and faster dispatch for clients in the area.Products not listed can try to be obtained on request through our vast array of suppliers.Executive SummaryBits n PCs is a Durban based reseller who aims to become an online retail giant in the South African market when it comes to purchasing computer parts, accessories and other electronics.
The company strives to bring competitive prices and a speedy delivery and provide and excellent all round service to the client. The company sells computer parts such as motherboards, cpu’s, ram, cables, cases, etc and other hardware such as networking devices, routers, etcThe company also sells other electronics such as laptops, TV’s and smartphones The company target market is people looking to buy any pc components and we have a competitive advantage because of aggressive pricing.Bits n PCs is formed as a sole proprietorship.
Bits n PCs will be launched online under the domain www.bitsnpcs.co.za . It will be run at the premises of the owner as a home office start up utilizing a spare room for the office use.
As sales increase we will hire additional personnel to assist with taking orders and forwarding them to couriers for delivery and local collection for Durban based customers.Financial RequirementsIn order to get the company started cash is needed for purchasing stock. A short term loan is also required of up to R50 000. The loan is to be paid within 3 years.
The capital will be used to create an online platform and purchase stock of items to be sold.Financial Forecast Over the next Four Years ObjectivesTo provide the highest quality of service to the online community.To create considerable market, share so that Bits n PCs is a common name.Constant growth in sales from start up through year four.To create customer satisfaction so that at least 50% of our customer base is returning customers MissionOur goal is to set the standard for e-commerce and customer satisfaction bringing the highest quality of customer service available. Customers will be updated every step of the way through the order process. Any future employees will receive extensive training and know every product that we sell and be able to give recommendations to customers seeking help or assistance using their own good judgement. Our employees will receive a great place to work, fair pay and benefits, and incentives.
Keys to SuccessEstablishing a brand identity and generating brand recognition through marketing.Responsiveness: being an on-call computer paramedic with fast response time.Quality: getting the job done right the first time, offering 100% guarantee.Relationships: developing loyal repeat customers–retainers.General Company DescriptionBits n PCs is an online computer retailer located in Bluff , Durban owned by Pretesh Indrason. With a small 3 year loan, Bits n PCs will grow from a single person home office online retail to a minimum 3 person business in a leased location. We will create the necessary infrastructure to quickly and efficiently respond to customers’ computer enquiries and purchases, guaranteeing speedy, friendly, competent, and cost-effective serviceCompany OwnershipBits n Pcs is a sole proprietorship. However, recent feedback from our marketing outreach has suggested a much higher sales potential than originally imagined and PC Repair has been reformed as a Closed Corporation (CC).
This change will provide additional legal protection for the owner, and will also streamline the financial operations of the company as we expand the personnel to 5 within the next three years, lease a separate space for offices, and purchase company vehicles and cell phones.Startup SummaryTotal start-up expenses include initial expenses for establishing our website, setting up the business, and doing our pre-opening advertising.The bulk of our start-up requirements are asset needs: We need to purchase stock on hand for same day and local delivery.
We will need to purchase a small home office pc for the purpose of taking orders and couriering them to our customers. We also need start-up inventory which includes RAM, spare hard drives, motherboards, and cases, the most commonly purchased items. Although we will keep expenses to a minimum for the first three months, before we move, we will also need cash at start-up, to see us through the next several months with a positive cash balance.We plan to fund our total start-up requirements direct owner investment (including the contributed assets), and a three-year loan secured with the owner’s collateral (his home equity). We should be able to easily repay this loan within three years, even with a much lower sales revenue than projected.
Hours of OperationThe business will operate at 8.30am to 4.30pm Products and ServicesProducts and services offered will mainly be selling computer components and selling prebuilt and custom made pcs according to the customer specifications and requirements. SuppliersStock will be purchased from suppliers and orders can be dispatched from them to be couriered anywhere in South AfricaManagement The owner is an IT student graduate and has experience with hardware and software and has knowledge of the products being sold as well as assembling and disassembling computers Employees should have a strong back ground in computers and hardware and up to date to current trends and technologiesEmployees should have minimum A+ certification as to have an extensive and vast knowledge and basics of computersThe Opportunity, Industry and Market DescriptionWhere is the gap in the market?There is a gap in the pc enthusiast market making it difficult to source international brands of products that aren’t currently available or is limited by the range. The is also a lack of variety when buying components locally and their exorbitant pricing What has given rise to this gap?Lack of interest or difficulty to source the products How was this gap identified?Various members of multiples forums have wished to see these international brands that aren’t available locally be seen in the local market How will the gap be filled?It can be imported directly from the manufacture saving the customer the hassle of importing The IndustryWhat are the barriers to entry in this industry? The barriers to enter the industry are finding suppliers with competitive pricing allowing you to profit without inflated pricing against the msrp(manufacture suggested retail price) of products How will you overcome the barriers to entry? I will be importing directly from the manufacturer and be getting the best possible prices from the suppliers. How much power do the customers have? The customers do not have any significant power or influence over the price they pay as it is dictated by the manufacture and other factors such as currency, shipping costs, etc Who are the suppliers? They are the companies that import directly from the manufacturers and sell the local retailers they are known as distributers. Do they have significant power or influence over the prices they charge? Yes, they do because they are one of the main sources for obtaining the products hence they can dictate the prices. Are there a limited number of suppliers? There are many suppliers in South Africa each specializing with their own imports from various international manufacturers such as Acer,Asus, MSI Are there substitute offerings for the product or service? Yes there are, there are mass retailers such as Takealot or Makro who also import directly from the manufacturer and provide competitive pricing but also limited range as those are not their only products What products and companies will compete with you? Online retail companies such as Evetech and Wootware How will your products or services compare with the competition? I will plan to undercut their pricing and offer a pricematch service What are the major changes affecting the industry? Government regulations such as Tax and The strength of the Rand to other currenciesThe MarketWhat is the total size of the market?There is no set total size of the market but it is always fluctuating and growing it is around 29%How fast is the market growing?The market generally grows rapidly when a new product is released and people want to upgradeWhat are the major trends in target market – trends in consumer preferences, demographic shifts and product development?The latest trends have been hardware with an RGB feature which allow them to light up any color and set the mood or theme for a persons build.
The target market is the PC gaming community. They are all across the country and we will be advertising through social media and other means such as forums or google advertisementsMarket Analysis SummaryBits n PCs will provide computer parts and components in both a consulting and technical capacity to home PC users , small business owners as well as larger companies. Since Bits n PCs is currently a one man operation is growth will be limited by the owner’s capacity to take orders and advertise to generate customers. We will need to establish credibility and reputation. We will focus on delivering excellent customer service.
Personal market research by the owner indicates an attractive market niche for our services, of which Bits n PCs will take full advantage. The very nature of the computing industry, with its extraordinary rate of technological development, creates a constant need for upgrading to the latest technologies to stay relevantMarket SegmentationThe existing computer service market is so extensive that categorizing it is rather difficult. We have broken our potential market down into two groups, based on their needs: home PC users and small business clients.Home PC UserHome PC market are users with more sophisticated applications generally have enough tech savvy, from tech experience at work, to do their own repairs and upgrades. Their hardware needs will include the computer itself, monitors, keyboards, mouse, motherboards, graphics card, etc This group is growing slightly faster than the overall population growth in our area, in part due to the increasing demand for computersSmall Business UsersThe small business market will be defined as customers within a 15 km radius, with 2 or more computers or a network which they use for business purposes at least 25% of the time. Their hardware needs will include the same items as home users, plus servers, backup systems, data storage, and wireless networking.
The portion of the small business market we are targeting is growing at around 2% a year.189445-15371900STRATEGYThe focus on the business: . The focus of the business will be to sell computer parts and accessories online. Providing excellent customer service.
Another focus will be to advertise the businessHow will the business succeed in the market?We will try to undercut competitors pricing or pricematch themWhat is unique about the business? We offer same day delivery and local collection for customers in the area if the item is in stock.What is the value for the Customers?The value is there is a flat rate fee for delivery for anywhere in South Africa and collection service is offeredBUSINESS MODEL EXPLANTION Major costs involved in generating the revenue:The major cost would be purchasing stock and buying shelving storage and cupboards to store the goodsThe profitability of the business:Example. If I purchase a mother board for R1000 and sell it for R1300 that is a 30% markup and 30% profit which is R300The Investment Required to get up and Running:The total investment to get this type of business up and running would be around R50 000Critical Success Factors and Assumptions: My success factors would overall be good customer service and service delivery in order to make a lot of. We will also honor the product warranties the best we can Customer satisfaction is a priority. TEAM MANAGEMENT AND ORGANISATION FOUNDERS:Pretesh Indrason (myself), 3 years in sales consulting in Matrix Computer shop. Has a Diploma in ITMANAGEMENT OF BUSINESS (DAY TO DAY):Pretesh Indrason – I will be running the daily operation of the business.
Such as taking orders, answering queries , and dispatching orders to couriers for deliverySales Consultant 1 – This person will have all of my duties and be in charge of advertising as well. Management SummaryPC Repair will be owned and managed by Pretesh Indrason. Pretesh has years of experience in computers, networking, and sales. Pretesh has also spent the last three years as a sales consultant in a physical computer, and understands the computer needs of PC users. Pretesh is adept at managing his time, and at quickly responding to multiple customer and needs.For the first three months, Pretesh will be in charge of all aspects of the business. Pretesh will maintain direct control over inventory ordering and book keeping. Part of our brand recognition strategy is to identify Bits n PCs with Pretesh’s efficiency, friendliness, and technical expertise.
The easiest way to associate the two is for Pretesh to be a major part of many customers’ experiences with us. He will delegate customer sales later in the year to the sales consultants working in the leased office space, and will also train them in his method of online sales support.Personnel PlanPretesh Indrason will be the only employee for the first few months; his salary is directly related to the success of the business, and will never exceed 18% of sales revenue. In the third month, we will move to a leased office space and hire a second employee. We plan to hire additional part-time employees in the second year, to better handle the increasing sales.Our employees will be skilled professionals, with equally strong technical and people skills. It is very important to Pretesh that they be paid salaries commensurate with their abilities and dedication- happy tech support people make for happy customers. MARKETING PLANService Business AnalysisBits n PCs has established a relationship with a local distributor to do rapid special-ordering; although this capability is more expensive than normal channels, it will enable us to quickly establish a reputation as efficient and responsive to customer needs, particularly for our PC users.
We will leverage this customer loyalty into great word of mouth marketing and steady growth.Target Market Segment StrategyAlthough there are more potential customers among home PC users, we expect the majority of our revenue to come from PC users, since they are willing to upgrade to the latest technology quicker than businesses. The majority of our marketing efforts will thus be focused on small PC users.
These customers have full-time IT needs. Competition and Buying PatternsCustomers choose computer repair and assistance services based on reputation, previous experience, and price. They may choose to return to a mediocre provider with whom they’re familiar, rather than try out a new unknown company about whom they’ve heard nothing. Large stores, especially the service departments of national chains, have a great advantage simply in their affiliation with an established brand. Establishing our brand identity and a great reputation in the first few months is critical to our success. Once we have broken in to the local market, our great service will turn new clients into permanent clients.
Our services will be second to no one and our prices will be very reasonable for the high quality service we offer. By providing superior service, word of mouth alone will bring in many new clients. The satisfaction our consumers find will keep them coming back.
There are two main competitors for the computer upgrade and repair business in this area:Competitor A. They are a well-established provider of computer components and services, and do offer good customer service. However, they have a high staff turnover, a young and inexperienced staff, and are more interested in selling new components than in maintaining existing machines or finding custom solutions. They do not offer any kind of pick-up and drop-off service for returns and refunds.Competitor B. Smaller and less known then A, B provides many services for residents living in northern parts of Durban. They are more willing to spend time with a client, figuring out exactly what his or her needs are, and suggesting new options than competitor A. However, they have an inefficient ordering system and an unkempt shop, which deters potential customers and can turn existing customers to the competition.
They are considering instituting a trial pick-up/drop-off service. They are in the best position to copy our innovations and steal customers, but their management is complacent and may not respond to competition.Both of these companies’ charge prices in excess of the products we will be able to attract the price-sensitive market without much work. Strategy and Implementation SummaryOur Strategy and Implementation turn on three points:A value proposition of timely and timely delivery, at a reasonable rate, coupled with a 100% guarantee.
Exploiting our competitor’s weaknesses: a competitive edge based on quick, effective, and sympathetic customer service.Quickly establishing a brand identity and developing a great reputation among local customers to generate word of mouth advertising.Competitive EdgeQuick response: Bits n PCs will provide same day delivery for local customersA flat rate policy: This undermines the competition, where they charge extra for delivery based on your area. On-site and pick-up/drop-off services: We will offer to pick up any products within warranty for the first 6 months for free should it be faultySurprisingly, our small size is an advantage: customers will recognize me (and future employees), and will know they will get the same great service every time they purchase through us.POSITIONING OF SERVICEMy business will have that wow factor to it to make sure customers will choose my business for their business needs. I plan to fill the gap between affordable computer hardware and customer service. PRICING STRATEGYExample of pricing strategy Include a 20 – 30 % mark up on itemsPurchase Price Selling PriceMotherboard R1000R13004gb DDR4 Ram Stick R500 R700Marketing StrategyOur marketing strategy will aggressively exploit our competitors’ weaknesses. During the start-up phase, we will run large ads in the business section of the local newspaper.
These ads will focus on our advantages, competitive rates, and quick response an delivery times. They will announce our opening date, and include discounts on selected items for the first 50 customers. We will continue periodic advertisements, including several promotions (discounts, free delivery for orders over x amount, etc.) throughout the first year. We expect a small but steady response from home PC users who see our ads elsewhere, but will also run monthly ads online and on social media.Sales StrategyOur marketing strategy will generate customer inquiries. We will close the deals by offering an outstanding service and a very reasonable price. Happy customers generate repeat business and word of mouth.
I will be available to answer calls and queries about products. At other times, or when I am on the phone, an answering service we have hired will catch callers and give them an estimated wait time for a call-back; this is another step towards delivering a complete solution to our customers. OPERATIONAL PLANDaily operation of business: My business will operate from 8:30 – 4:30.PRE OPERATIONALIncorporate business. Set up website.Set up office, equipment, supplies, telephone system, etc.
Select and order computer system and related software.Establish bank relationship.Establish relationship with suppliersPurchase storage for stock and purchase stock.
Establish legal and accounting relationships; ensure necessary compliance.Finalize standard agent member contract.Location : 60 Gadwal Road Merebank, Durban 4052Equipment :Home Office Pc Desk Chair InternetPeople : Pretesh Indrason (Owner)Processes: There’s numerous processes involved in running a successful online computer shopMake sure deliveries are on time with courier company. Make sure customers receive their items in a good conditionCheck stock prices an update websiteUpdate stock status on websiteCorrect paperwork for customers to receive goods.
Make sure customers are happy with purchase and assist them with warranties and returnsCASH All funds received will be done online and will be going to the company account.Customers are advised to using eft or other methods such as payfast .SKILLSAll personal will be qualified and have knowledge of the items being sold.
FINANCIAL PLANThis represents the financial amounts needed to start up the businessBusiness Licenses R500Incorporation Expenses R1000Deposits R10000Bank Account Rent N/AInterior Modifications N/AEquipment/Machinery Required: Item 1 Home office PC – R5000 Item 2 Desk – R1000Item 3 Chair – R1000Total Equipment/Machinery R7000Insurance R1000Stationery/Business Cards R1000Brochures R1500Pre-Opening Advertising R1000Opening Inventory R300000Other (list): N/AItem 1 Item 2 Total Startup Expenses R53000left000right20637500Pro Forma Cash FlowMonth 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12Cash Received Cash from Operations Cash Sales R2,340 R3,300 R3,240 R11,500 R20,740 R24,300 R28,800 R31,700 R33,360 R12,900 R9,400 R21,450 Subtotal Cash from Operations R2,340 R3,300 R3,240 R11,500 R20,740 R24,300 R28,800 R31,700 R33,360 R12,900 R9,400 R21,450 Additional Cash Received Sales Tax, VAT, HST/GST Received 0.00% R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 New Current Borrowing R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 New Other Liabilities (interest-free) R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 New Long-term Liabilities R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 Sales of Other Current Assets R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 Sales of Long-term Assets R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 New Investment Received R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 Subtotal Cash Received R2,340 R3,300 R3,240 R11,500 R20,740 R24,300 R28,800 R31,700 R33,360 R12,900 R9,400 R21,450 Expenditures Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12Expenditures from Operations Cash Spending R2,000 R2,000 R2,500 R4,900 R5,400 R5,400 R7,800 R7,800 R7,800 R7,800 R7,800 R7,800 Bill Payments R105 R3,102 R2,353 R10,424 R8,954 R13,556 R15,209 R15,896 R16,290 R16,282 R4,550 R4,152 Subtotal Spent on Operations R2,105 R5,102 R4,853 R15,324 R14,354 R18,956 R23,009 R23,696 R24,090 R24,082 R12,350 R11,952 Additional Cash Spent Sales Tax, VAT, HST/GST Paid Out R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 Principal Repayment of Current Borrowing R547 R547 R547 R547 R547 R547 R547 R547 R547 R547 R547 R547 Other Liabilities Principal Repayment R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 Long-term Liabilities Principal Repayment R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 Purchase Other Current Assets R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 Purchase Long-term Assets R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 Dividends R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 R0 Subtotal Cash Spent R2,652 R5,649 R5,400 R15,871 R14,901 R19,503 R23,556 R24,243 R24,637 R24,629 R12,897 R12,499 Net Cash Flow (R312) (R2,349) (R2,160) (R4,371) R5,839 R4,797 R5,244 R7,457 R8,723 (R11,729) (R3,497) R8,951 Cash Balance R27,688 R25,340 R23,179 R18,809 R24,647 R29,444 R34,688 R42,145 R50,868 R39,139 R35,642 R44,593center000left5202100center44767500ConclusionI believe my business will succeed as it has all the core values it needs to thrive and be successful in the market. I hope all the information provided is sufficient for future clients and possible stakeholders. I have done thorough in-depth research into the market and confident the business with be successful from the time it launches. The business will continue to grow and supersede our expectations.
Please feel free to contact the owner (Pretesh Indrason) for any queries related.Referenceshttps://www.bplans.com/computer_repair_business_plan/strategy_and_implementation_summary_fc.phphttp://smallbusiness.chron.com/open-own-computer-business-2429.htmlhttp://smallbusiness.chron.com/become-distributor-computer-parts-accessories-12545.htmlhttp://smallbusiness.chron.com/start-computer-repair-business-home-4433.htmlhttp://wsj.miniplan.com/spv/3015/7.cfm#1070000