BBT backpack - Our final marketing plan assignment worth 30% mark. We got perfect score. PDF

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Our final marketing plan assignment worth 30% mark. We got perfect score....

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1

OVERVI EW

This backpack’s main function is the maximum back support. The bag strap allows for the backpack to fit on a luggage. Breathable and adjustable shoulder straps relieve the stress on the shoulder. There is a foam padded top handle for a long time carry on. As well, we connect our products to our local community to create economic growth. We set up the recycling system and provide service to the customer. Our products have five feature benefits for customers such as being waterproof, an anti-thief pocket in a back, customization color of optional rain cover or bag pocket, and 20% weight off bag rather than the same size of the competitor’s backpack. Our backpack is 20% lighter compared to a same-sized bag from our competitor. An anti-thief pocket in the back is easy to access customer’s personal things without removing the bag from their shoulders.

2

MARKETANALYSI S

Our products are taking the position of customizing the bag by selecting a color, reducing body pain and showcasing a 30 L bag size. This is so our product can be used both for leisure and work. Our product is going to be priced for the middle class, so we are going to take a range from CA$ 50 to 70, it depends on which options the customer choose. Our segment market is for people with a middle-class income. We will use an online advertising platform with a focus on social media like You tube, Instagram, Facebook and Twitter etc. We will show them how the impact of their backpack weight will affect their body, especially for children.

We are

comfortable assuming that most parents worry about their children and the pain that can come from carrying heavy backpack daily. After 6 months, we analyzed customer reviews that 35% of buyer were parents who purchased for their children (10 – 15 years old) , 45 % of buyers were male students (18 – 28 years old), and 20 % of buyers were female students (18 – 25 years old). Those customers are living in an urban area in Canada. Most customers tended to need a bottle space beside the backpack and needed a smaller size backpack. They also mention that they prefer to choose a simple color (black, dark brown, red and navy). They are willing to buy our products online. We need to reposition for men and women who use backpack for leisure and work.

3

PRODUCTS

We re-launched a new back project with an added bottle pocket beside the backpack and selected different colors (black, dark brown, red and navy ). However, we kept an option if customers would like to select their favorite color by premium. Another option which is choosing backpack from 2 sizes. One of the sizes is a 23 L backpack which is 10-inchi laptop fit-in backpack. The bag weighs lighter than the regular size one(30L). This backpack suits young children and workers who want to get compact, functional less heavy back pack. Our competitors positioned same position as “travel and work” backpack. SAMSONITE travel bags have many compartment and pockets and their concept is a backpack comfortable to carry, while the TSA checkpoint-friendly design makes it ideal for travel. (Samsonite & Best Buy, n.d.) However, they do not have a variety of color and are a little bit heavier than our products. Customers are willing to get the right backpack when they travel around. We have a function for security such as hidden back pocket and new “THEFT PROOF DESIGN DAYPACK”: Zipper of main pocket is fully hidden in the back of the backpack; no thief will easily open your backpack. It is also equipped with a secret pocket behind the bag which can keep your valuable items from thieves. Our backpack has a pocket function to help customers easily organize their personal items. They do not need to scramble around many pockets looking for their items.

COMPANY X WEIGHT Samsonite

4

23L They don’t have size on the backpack

30L 1.68 kg

BBT

1.0 kg

Retrieved from: [CITATION Sam \l 1033 ]

5

1.35 kg

PRI CE In the growth stage of BBT, we are using a skimming pricing strategy in order to penetrate the market. Our main focus is to avoid charging the customers too much at the same time were making a profit. We try to charge the same level of other backpacks has to offer. Moreover, the BBT manufacture expenses is very fluctuate it depended on how difficult to find the rights materials, fabrics, and any other items at that time. As a result, from the products that we offer the range of our price can be determine of the market price or the global economy during that time. To conclude we compare our prices from many backpacks brands, but it turns out that the level of price is pretty much the same between the BBT and Samsonite. Therefore, the BBT applies the cost-based pricing strategy with the comparing of market price of the same kind of business as well. The BBT passes through the penetration passes, this way it will maintain the same level of price by reducing the cost of our products or increase a few percentages of price in our backpacks every year. A few increasing does not draw the attention from the customer, but the huge increasing will draw more attention from them. Over the period of time, the BBT will be in the half way of the growth stage in the product life cycle. As we carefully implemented our skimming pricing and cost based pricing strategy our product will able to apply for our business in order to sustain it in the growth and maturity as long as possible. In a long-term pricing strategy, we will innovate our product when it comes to quality and adding features, as gradually improvised our product the charge will be higher as we offer a well upgrade backpack. 6

Pricing range of BBT’s products: $50 to $100

7

PLACEMENT Our channels of distribution BBT will choose sales representatives and sales management who will be trained in the respective countries  Canada, America, and across Asia. Channel resolutions are vital because of the number and trait of associations that must be managed. Channel resolutions characteristically consist enduring legal obligation and responsibilities to different intermediaries. Such dedications are often really costly to terminate or alter, so it is essential for our company to document the character of the relationship with the foreign partner. Thus, the distributor or agent accord should also offer for adjudication in a neutral forum in a third country. BBT assumes that, local laws will protect agents and distributors; even in the lack of a formal written accord where commitments will be supported by good faith and thoughts of mutual commitment. The choice for distributors and agents in a target market is vitally significant. Characteristically, a local distributor is needed since our market participant to inform about the BBT local business practices and needs a partner with links to potential customers requires. In this case, BBT will seek to limit their risk and financial exposure with monitoring the performance of local distributor. As is the norm, all the items will pass through a computerized dating machine CBM, ensuring that the product reaches the consumer in a high-quality state. Before final dispatch from the factory, all products monitored by Condition Based Maintenance & Monitoring (CBM), having been metal detected to ensure quality and safety. Over sixty vans are involved in distributing BBT products in  Canada, America, and across Asia. All of them are specially insulated and each will place a silica gel, operating on a distribution schedule that ensures the most 8

rapid delivery possible to retail stores, hotels, institutions and retail outlets alike. BBT products are sent by Air, Road and Sea from our factory to destinations worldwide.

PROMOTI ON Wea r eg oi n gt ous epr o mo t i o nt o ol st opr o mot eBBT. Fr i s t ,weu s es a l epr o mo t i ont o ola sr e b a t e s( c a s hr e f un ds )f ore a c ho v e r$50de a l ( i nc l udi n g$ 50) ,r e ba t e s$ 10ba c kb yma i l .Wen e e dc u s t ome r ss e ndba c kt oma nuf a c t ur e rwhi c h i sBBTpr o ofofpur c h a s ea sabi l l ,a tt h es a met i me ,wea l s ogi v ec us t ome r sf e e dba c kf or m( t h e de t a i lha sc o mmod i t ya ndp ur c h a s es a t i s f a c t i o nq ue s t i o nna i r e ) .Cus t ome r sc a ng e tt h ef or mf r o m t h er e t a i l swh e nt he yp ur c ha s e .Al s ot he yc a ng e tf r om o urwe bs i t ea n dd o wn l oa dpr i nti t .The n wewi l ls e ndt oc us t ome r$1 0c a s hb yma i l .Onepoi ntt ha tweg e tt hei nf or ma t i o nf r o mc us t ome r f e e d ba c k, a no t he rpoi nti t i sdi ffic ul tf orc u s t ome r st or e j e c tc a s hr e f u ndspr o mo t i on s . Se c ond,weus epr i c ep a c ks .Asweh a v et wod i ffe r e nts i z eb a g swhi c ha r e2 3La nd30L. Thet wodi ffe r e nta r edi ffe r e n tpr i c e s .Wea l s oha v ed i ffe r e ntc ol o r sf o re a c hs i z e .So ,wede c i d e f ors umme rt i mea sJ ul yt oSe p t e mbe r ,weh a v e10% offf org e t t i n gt wopr o duc t s( An yki n dof s i z ea n dc ol o r s10%OFFf ort woBBT) .Al s o ,b u yFo urg e to nef r e e .( BUY 4GET1FREE! ! ! ) Fo rt hi sp r omot i on ,ou rt a r g e tgr o upa r ebi gf a mi l ya st woo rmor et ha nt woki dsi naf a mi l y . And s omeofc o mpa ni e sf orgr oupwor kt ha tc o mpa n ypr o c ur e me n t .Ands omes c hoo l sr e wa r dsf or s t ude nt s .

9

Thi r d,weus epr e mi umspr o mo t i ont oolt opr o mo t eBBT.Pr e mi ums& Adv e r t i s i n g s pe c i a l t i e s .Wede v e l opag a meonl i ne .Thewi nn e rc a ng e tagi f tf r om us ,wh i c hi saba s k e t ba l l ba gf orf r e e .Wea s kc us t ome rt owa t c hBBTc o mme r c i a la ndpl a ya s ma l lg a me .Wes e ndt hegi f tb yma i l .Thepr e mi ums t ha tba s ke t ba l lb a gsa l s oh a v eou rl o g oont hes i de . Wec on s i de rs t ude n t ’ shobb yi ns c hoo l ,a ndwha t t he yl i k et op l a ya tf r e et i me .Fr om t he ma r ke t r e s e a r c h,bo y sl i k et opl a yba s k e t ba l l .An dt heba ga l s oc a nfiti ns omec l ot he sa nds ho e sf orgi r l c h a n g i n ga ndgym’ se x e r c i s e .Fo rt het r a v e l ,t hegi f ta l s oc a nc o v e rBBT,whi c hi smor e c on v e n i e n tt os t a ya wa yf r o m du s ta ndk e e pBBTc l e a n.

BBTBas ke t ba l lba gs

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BBTMo us epads

BBTCups

BBTTs hi r t s

BBTPe ns

BBTUSBKe y s

For

other

stuff

we can use

an

even

in

school or a company workshop place. We can prepare activities in our target group place. Contests, sweepstakes and games give consumers the chance to win our gifts as T-shirts, pens, USB keys, mouse pads and cups. We have such useful and attractive gifts for any age consumers, whatever male or female that our consumers join to activity for luck, for fun, or just relax with their kids plays games to win a little thing to know BBT. We get an opportunity to introduce our products. On the other hand, some companies have “sweepstakes” that push their employee’s work hard on next year. The companies usually purchase some goods for their better employees 11

at the end of year, usually before Chrismal holiday. We can contact their purchasing department to promote BBT. Do group purchase sales. As we are looking for some target companies, that we have to focus on what kind of employees which carry more document or always need more stuff to carry. For example, bank, montages, financial, IT employees, not only students, but also teachers, professors. Schools have evens and workshop. We can contact their office. For example, George Brown collage has different kinds of evens at every month, like music festival, food festival. We can range GBC evens schedule that find an even to join them that show our products on the side, and also give to school 10% back for each sale during the even time. We also prepare some games and soft drink during the even to support GBC even success. At the same time, we let more collage students know our band BBT.

Ot he rBBTt r adepr o mo t i o n: For our manufacture direct more sales promotion dollars and gifts toward retailers and wholesalers than to final consumers. BBT can purchase resellers to carry our brand, use our logo, and give it shelf space promote it in ad, and push it to consumers. We offer merchandise shelves with our logo and special color for BBT. Any reseller maintains a uniform shelf. It’s kind of allowance to resellers. We want BBT looks different than other products in the store or in the 12

mall. We need to attract the attention of consumers in the first place. We also support the exchange of goods, color and size from resells, and promotional activities in the mall.

For resellers discounts policy: Basic on more purchase are cheaper. We have a spree for the dealers. Every 100 BBT bags that can get one spree which including 4 different color and size regular BBT bags and 4 basketball bags, 4 pens and 4 cups. Which are the promotion tools to push them get more deal. Which are free goods from our company. Another promotion tools for resellers that we use to push money and specially ad items. As we prepare some gifts as T-shirt, Cups, Pens, Mouse pads, and basketball bags, the stuff have our logo on them. Consumers get them for free, when they use it, they can see our band name and website information on it. Which is Adverting to us. Let more and more people know BBT.

SOCI ALRESPONSI BI LI TY 13

Our product material source supply from local company to support local economy, also we can communicate easily to import materials from overseas. Being socially responsible is a huge priority whether we’re partnering with vendors or providing peace of mind to our employees, customers and the local community. We want to ensure the most ethical practices, help improve working conditions, and protect the rights of people in factories where our equipment and apparel is made around the world. We’re working to be as mindful of workers and practices as we can human rights expectations such as maintain high ethical standards and operate under legal working hour requirements also, providing all legal wages and benefits to every employee. We engage in nodiscriminatory practices and instructing environmental safekeeping through assurance health and safety for both factory complex and dormitories by internal staff compliance auditors. We are going to support the local community, supplier and retailer through providing our products to customers, also we are going to donate Start2Finish through selling our products [ CITATION Sta \l 4105 ]. This non-profit organization helps lower-income children to prepare and collet for school items for free.

14

FI NANCI ALS

To modify our product… Changes on pricing… Cost of distribution and channels be… Cost to promote and market the new product… After meticulous calculations, our income statement provides the financial ventures projected for our first year. We are projecting that we will reach a net income slightly over two hundred thousand dollars. This number has been reached by calculating all of the expenses that BBT Backpacks will encounter in its first year. The average cost per square foot is roughly $20.00 in the surrounding areas of BBT (including our goal city of Canada). With a small store front to open up the business, the average cost for a 160 square foot store will be about $3,000 per month. Utilities required to run the store would account for approximately $3,000 annually, including gas to heat the building, electricity, and internet and phone services. Water will be included in the cost of rent. Giving each founder an even cut of the revenue of $20,000 per year will add to a total of $120,000; with prospects of higher sales and revenue, this figure is not set in stone and will fluctuate over the years. Insurance will cover the business if faults are found on BBT Backpacks, and will have an annual cost of $3,646. BBT Backpacks recognizes that we have an obligation to commit to corporate social responsibility; thus, we identify as philanthropic company for our efforts with nonprofit organizations. With that being said, for every hundred backpacks sold, the company will donate 15

five backpacks to local charities. The donations will occur in the last quarter of the year and account for the total year sales, allowing us to make a larger contribution as opposed to a few donations here and there. If sales are on cue, we will be donating roughly 2,000 backpacks at the end of the first market year. This price is projected to be roughly $30,000 as shown in the income statement above. Operations will take a toll on this company. BBT Backpacks will face a projected total of $125,600 in its first year. While the founders of the business will play a large role in the day to day company operations, it will still have to hire extra help for the store. Paying minimum wage and hiring approximately 3 employees will incur an additional $38,400 cost for these employee paychecks. If the employees are to work roughly 32 hours per week with two weeks off per year, we reach the provided approximate cost. We will also be hiring a textile and production team in total four people full time at $15.00 per hour at 40 hours a week. The National Association for College Admission Counseling is one of the few conferences that BBT Backpacks will take part in. There is a fee of $790 per night, per table. This data has been used to configure a vast majority of the advertising expenses, including the other college-based and college-focused conferences in the Greater Toronto area that the business will take part in. $2,500 has also been set aside for office supplies for the year. Finally, operating expenses will take another hit in BBT Backpack’s bottom line. $60,000 is expected to be spent on both raw materials and machinery. Between fabric, zipper, and back support materials, a rough total of $25,000 will be exhausted on raw materials; another $35,000 will be spent on used equipment. These machines can be found on various sites such as Craigslist and eBay. 16

With all expenses accounted for, BBT Backpacks will be taking in a net income of $211,754. This profit will allow for BBT Backpacks to grow extensively. Profit will be saved following the first year to ensure the longevity of the business’s existence, but if a similar profit is made in consecutive years, then significant expansions will be made to the company. New machinery and a larger second store front will be the first priority large-scale investments in the company. Once BBT Backpacks is well-known in the Greater Toronto area, we seek to increase prices and spend a greater amount of money on materials used for product manufacturing.

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Re v e nue s Gr os sSal e s ( Pr o j e c t e d) Bac kpac k Donat i ons

$5 00, 00 0. 00 ( $3 0, 000 . 00)

Ne tSal e s

$4 70, 00

Cos tofGoods Ra wMat e r i al s Te x t i l e Mac hi ne

$2 5, 000 . 00 $3 5, 000 . 00 Cos tofGoods

$6 0, 000 . 00

Gr os sPr ofit Ope r a t i ngExpe ns e s

$4 10 Sal ar i e sof Sal e spe o pl e

$3 8, 400 . 00

Sal ar i e sof Pr oduc t i on t e am Sal ar i e sof Te x t i l et e a m

$4 1, 600 . 00

$4 1, 600 . 00

Adv e r t i s i ng

$1, 50 0. 00

Offic eSuppl i e s To t al Expe ns e s

$2 , 500. 0 0 ( $1 25, 60 0. 00)

Ge ne r alExpe ns e s Offic eSal ar i e s I ns ur a nc e Re nt Ut i l i t i e s To t al Ge ne r al Expe ns e s

$1 20, 00 0. 00 $3, 64 6. 00 $36 , 000. 0 0 $3, 00 0. 00 ( $1 62, 64 6. 00)

Owne r ’ sEqui t y Owne r I nv e s t me nt s Ne tI nc ome 18

$9 0, 000 . 00 $2 11, 7

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