Download - Das uber leather werkz long version 2
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DAS LEATHER WERKZ
Ho Fengkai (12662826)Sven Rischka (12662893)Lisa Pang Chih Pei (12661744)Sidhu Jujhar (12667282)
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Table of contentResearch AnalysisConceptMarketingOperationsHuman ResourceFinanceConclusion
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Research Analysis
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Hypothesis
Questions our team asked before embarking on this project. What kind of problems did people usually face? Is there a business potential in solving this problem? Is there somebody already doing this that we do not
know? Finally, Is there a market in Singapore for handbag
customization?
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Research AnalysisSecondary Literature ReviewBottega Venetta, Wilson(2010)
Contrary to popular belief, Bottega Venetta does customized orders
Very expensiveNiche segment of their consumer demographics
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Research AnalysisSecondary Literature ReviewFreddy&Ma Online Store (2006)Most designer bags are copied within weeks of release.
By online mass customization orders, its possible to deter copy cats
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Research AnalysisSecondary Literature ReviewCustom Orders, Khan(2012)
Growing number of rich individuals spending on branded custom made products with 2 months waiting time.
Custom orders account for nearly 20% growth in market share in certain markets.
Phenomenon attributed to the rise in prestige and recognition as individuals grow more rich.
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Research Analysis
Primary Survey Research Survey construction
Objective of our survey is to investigate the some of the reasons why female and males would buy leather products
Questions are formulated in order to determine the underlying meaning of inference
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Research Analysis
Primary Survey Research Survey methodology
Team of 4, with 30 surveys handouts each City Hall interchange as the place of our survey
location (Reason being it is near our potential shop
space and has a high human traffic) Conducted over several days Target focus is on more female participants
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Research Analysis
Primary Survey Research Survey findings
80.70%
19.30%
Figure 1. Gender Proportion Females
Males
<18 19-25 26-35 36-45 >450
0.4
0.8
0.00%
61.95%38.05%
0.00% 0.00%
Figure 2. Age Group
<4 5 to 9 >100.00%
20.00%
40.00%
60.00%
80.00%
100.00%
10.88%
79.34%
9.78%
Figure 3. How many leather bags being owned
More than once a month
Once a month Once every 6 months
Once every year0
10.00%
76.08%23.92% 0.00%
Figure 4. How often do you buy leather bags
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Research Analysis
Primary Survey Research Survey findings
Quality Colour Branding Size Affordability Others0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
0.2826
0
0.304300000000001
0.4131
0 0
Figure 5. Reason for buying leather bag
<50 50-100 100-150 150-200 >2000
0.2
0.4
0.6
0.8
0.00%
76.09%
16.31%7.60%
0.00%
Figure 6. Spending on one leather bag
Service Price Quality Others Not Applicable0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
30.44% 29.35%
40.21%
0.00% 0.00%
Figure 7. Reason for being un-happy with any of the purchases
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Research Analysis
Primary Survey Research Survey findings
70.65%
29.35%
Figure 8. Interest in customizing own leather bag Yes
No
Yes No0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
<18
19-25 Age Group
26-35 Age Group
36-45 Age Group
>45
0.00% 0.00%
48.91%
13.04%
15.21%22.82%
0.00% 0.00%
0.00% 0.00%
<18
19-25 Age Group
26-35 Age Group
36-45 Age Group
>45
Figure 9. Interest in customizing own leather bag if unbranded.
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Research Analysis
Primary Survey Research Survey findings regarding potential for
secondary market of males
Belt Bags Wallet Shoes Jacket0.00%
20.00%
40.00%
60.00%
80.00%
100.00%
120.00%95.45%
27.27%
95.45% 95.45%
0.00%
Figure 11. What leather products do males use
54.54%
45.56%
Figure 12. Males interest in customizing leather
productsYes
No
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Research Analysis
Primary Survey Research Survey conclusion
Demand for customized leather bag exists in Singapore
Target Market Conclusion 18-35 women, mostly locals. Price range is somewhere between 150SGD to
200SGD
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Justifications of Business Plan
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Business Concept So what is it we are doing?
Hypothesis proven, therefore market existsThus, offering a chance to build your own custom made leather bag
Customer Value is in the experience of watching your own leather bag “come alive”
Focus filling of a market gap and solving the “if only it was in this color” problem faced by many women.
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Business ConceptTarget Market Analysis
Target market of range of 18-25 years old womenMore fashion oriented and willing to try new trendsHigher priority of liking the bag itself over branding
Not very brand loyalUsually possess more than 5 handbagsStill depends on the overall quality
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Business ConceptBackground/Situational AnalysisFirst in Singapore for Customized Leather Handbags
Quality Italian Leather2hrs Turnaround Time for crafting
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Business ConceptMarket Summary by PEST
Political Stable political situation
Economical One of the most highly developed and successful free-market
economy Social
A steadily growing population of 5.3 million Technological
Highly developed infrastructure Environment
Small but fast channel distribution
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Business ConceptMarket Summary by SWOT
Strength
Uniqueness
Versatility
High quality leather
High traffic location
Professionally trained staffs
Weakness
Limited productivity
High rental cost
Lack of warehousing support
Human Resource management
Opportunities
Rising potential in domestic market
Minimal local competition
Near Monopoly structure
Never Outdated
Utilization of fine quality product and skilled master workers
Threats
The lack of brand recognition
Major part of industry is unrecognized
Niche supplier
Low threshold for new entrant
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Business ConceptThe Leather Werkz Mission and Vision With the Justification of the business concept The Leather Werkz motto is “The Brand is You” Aimed at providing our customers the unique
experience of creating their own branded leather bags.
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Marketing Plan
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MarketingMarketing Objective for 5 years
Establish a customer awareness of our product / service and to clearly distinguish ourselves from our competitors
Focused on the waterfall strategyAfter 2-3 years we could open another outlet in a different part in Singapore
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MarketingSummary of the 7Ps
Product : Selling high quality, customized leather bags Wide selection of Product design
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MarketingSummary of the 7Ps
Price: 180 S$ (proof: research) justified by quality Launch promotional price of 10% discount
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MarketingSummary of the 7Ps
Place: Marina Square Near MRT, SMU Near attractions, hotel, SMU, Suntec Offices Huge crowd Easy to spot
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MarketingSummary of the 7Ps
Promotion: traditional media through Word of mouth, Flyers, Brochures,
Magazines Social media through social networks including Facebook,
Youtube. Special initiation perk collaboration with nearby offices aiming
at fresh graduates looking for jobs.
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MarketingSummary of the 7Ps
People: Founders must continuously improve on product attributes to
create sustainable comparative advantage. Detailed training plans for craftsmen and managers Customer Service
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MarketingSummary of the 7Ps
Physical Evidence: Mainly through word of mouth, user stories and
recommendation
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MarketingSummary of the 7Ps
Processes: 2 hours until bag is finished, Swift reactions to complaints. TAT 2 days
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Marketing Competitors Analysis Isn’t there somebody doing this already?Very expensive high end customization from branded names
Most suppliers are for industrial use, not commercial use
Singapore still doesn’t have well recognized concept store that focuses on leather crafting
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The potential shop spaces in Marina Square
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Operations Plan
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Operations Prototype from Leather Bag Manufacturer (different type and colour)
Handbag Accessories from Wholesalers Example: straps, hooks,
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Operations Daily operations
4 Workstations, Hand sewn at our shop in Marina square Walk-in Customers on Weekend and Public Holidays Appointments on Weekdays Max Customers in Shop per hour? on Weekends: 12
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Value Chain Diagram
Import multiple designs and accessories and inner sleeve
Customer comes in and chooses the design outlook for the first stage
Craftsmen assembles the initial bag with accessories
Same customer move on to next stage and choose the customization/embossing
Next Craftsmen finishes the customization and frees up the earlier craftsmen slot
Customer pays at the cashier for the bag
Customer leaves satisfied with a new hand sewn custom made leather bag
Customer comes back for in-house cleaning and repair, or to trade in for another bag
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Post Purchase Customer Service
Seal of proof for authentic leather included in every bag
Leather Care Products are sold in storeFurture: Inhouse Cleaning
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Human Resource Plan
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Human Resource
CEO
Sales Director
Logistics Director
2 Store Managers
4 Assistants
Operation Director
2 Master Craftsmen
4 Junior Craftsman
12 Employees in Total at the Start-Up
Organization Chart
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Human ResourceRole of ownersCEO Ho Fengkai
in charge of the entire managementkeeping company profitable and planning the company future
Overseeing InvestmentSetting BudgetEvaluation of Projects
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Human ResourceRole of ownersSales Director Jujhar Sidhu
Responsible for reviewing current trendsEstablishing sales quotas for store managersBlueprinting the future market expansion in terms of planning promotions, collaborations with the other companies or the organizations
Generate more publicity and awareness of our workshops and the services.
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Human ResourceRole of ownersLogistic Director Lisa Pang Chih Pei
Works directly with transportation companies to ensure the best pricing on shipping of our import goods
Time communicating with the sales director and the operation director to maintain supply and demand equilibrium
Optimize resources utilization and the productivity maximization.
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Human ResourceRole of ownersOperations Director Sven Rischka
Supervising and assuring the smooth run of the whole operation process
Ensuring that the business policy and imperative created by the CEO are being implemented and accomplished
Manage subordinate headsCoordinate with sales and logistic directors to make sure that all the goals are being met
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Human Resource
• Consistency Training Managers→ Shop assistant : ∆ Sales Ability ∆ Communication Skill Master craftsmen → Junior craftsmen : ∆ Quality Assurance
• Weekly reflection based on weekly performance
Training Program
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Human Resource
• 1 Manager• 2 Shop Assistants• 1 Master Craftsman• 2 Junior Craftsmen
Weekdays Working ShiftsIncreased manpower shall be allocated during weekend and holiday based on the day traffic
Store manager Master craftsman Junior craftsman Shop assistant
SGD 2,200 SGD 2,000 SGD 1,700 SGD 1,200
Salary Monthly
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Financial Plan
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The Finances Total amount we need to start is $144,450
Includes Rent deposit of 6 months, taken at 800sqft, $19 per sqft
Startup Cost of business
Direct Materials
Cost of bag imported $3,100Cost of accessories imported $200Cost of inner bags $1,850 Direct Labour Mangers 2 $4,400Craftsmen 6 $10,800Assistants 4 $4,800 Overhead Rent deposit for 6 months $91,200Renovation costs $10,000advertising costs for 6 months $17,100Equipment Purchase $1,000 Total Startup cost $144,450
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The FinancesBreak even point under different scenarios Break even bag per day, average at ~9 bags a day Per month cost of $40,350
Per month basis for 500 bags
Direct Materials
Cost of bag imported $3,100Cost of accessories imported $200Cost of inner bags $1,850 Direct Labour Mangers 2 $4,400Craftsmen 6 $10,800Servers 4 $4,800 Overhead Rent deposit per month $15,200 Total Monthly cost $40,350
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The FinancesBreak even point under different scenarios Break even bag per day, average at ~6.9 bags a day Per month cost of $45,300
Per month basis for 1000 bags
Direct Materials Cost of bag imported $6,200 Cost of accessories imported $200 Cost of inner bags $3,700 Direct Labour Mangers 2 $4,400 Craftsmen 6 $10,800 Servers 4 $4,800 Overhead Rent deposit per month $15,200 Total Monthly cost $45,300
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The Finances
1 2 3 4 5$0.00
$1,000,000.00
$2,000,000.00
$3,000,000.00
$4,000,000.00
$5,000,000.00
$6,000,000.00
$7,000,000.00
$1,131,124.61
$2,730,424.61
$5,272,722.96
$6,108,976.83$6,597,694.97
End of Year Cash Flow
Cost of Capital 10%Net Present Value = $129,814.70 (positive NPV)
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Conclusion
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Conclusion
There is a market for customized leather handbags Our business proposal can fill this gap in the market Overall project is feasible
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Thank You