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Business Plan

11/04/20, 11 :45 PM

Chirag Mehta s3834337 Managing Director Lavish Home Decor Lavish Home Decor: Focusing on uniqueness and quality of products by expanding the business. http://t.cred.ly/l/80490fe5-3995-4056-9b7f-d7900bc6bfd3

Business Plan

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Business Plan

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Contents 1. Business Idea

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2. Business Structure 3. Organisational Diagram

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4. Analyse your company's value chain 5. Variable Cost 1

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6. Variable Cost 2 7. Fixed Cost 1

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8. Fixed Cost 2 9. Define CSR in your business setting

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10. Environmental/resource impacts 11. Community impact & engagement

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12. Internal stakeholders 13. Describe how the success of your business and business idea will be

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measured 14. Performance Measure - Financial

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15. Performance Measure - Non-financial 1 16. Performance Measure - Non-financial 2

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17. Performance Measure - Non-financial 3 Reference List

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Business Plan

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1. Business Idea Lavish Home decor is a leading showpiece manufacturing company based in Dubai.It was setup in 1997. It specialises in the production of steel and glass showpieces.The company has 2 units set up in Dubai and 1 in India and is looking forward to set up another one in India after getting a great response there as well. Lavish home decor also export their products to Turkey,Qatar and Pakistan online as nowadays people are fond of e-commerce. But after reviewing the feedbacks of the customers it seems that the customers are not able to get a variety to choose from and that designs are similar to previous ones and also about the quality of products getting low. This led to a decrease in the sales of the company. So by keeping in consideration these feedbacks, the company should bring in more new and unique designs and also should focus on the quality of the products manufactured. For this the company will hire a new designing team which will bring in more unique and creative designs for the showpieces to be manufactured. And for the maintenance of the quality of the products the company will import in new machines and also send the old ones for lubrication as they are more than 20 years old. By taking these steps the costumers will definitely be satisfied with variety as well as quality of the products.

2. Business Structure Lavish Home Decor is profit making organisation. It is a private manufacturing company. With the expansion of the business by bringing in new machinery and new designing team the management will also have to keep in mind the organisational goal i.e. profit maximisation. So as to maintain a good business structure the company has different departments for the organisation to work smoothly and also maintain the finances of the organisation as well. Therefore, it will lead to profit maximisation, increase in sales and satisfaction of the customers at the same time.

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Business Plan

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3. Organisational Diagram

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Business Plan

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4. Analyse your company's value chain 1. The value chain activities included in my organisational diagram includes both primary as well as support value chain activities. The primary activities in the organisational diagram are the purchase of raw materials, daily work operations, product handling, product distribution, sales marketing, and post-sale services. Whereas the support value chain activities include human resources(strong management team), E-commerce, a smooth communication process, and new technology forms(CAD and MEC). 2. A value-adding activity from the value chain is using better and new machinery. This is because it will add value to the final product such that the total value is greater than the cost and helps in the quality production of products. It also satisfies the costumers as they are being delivered by high-quality products which prove to be valuable for their money paid. 3. A potential non-value adding activity in my business is that the number of products produced at a time is quite large. Those products are then stocked for later which is not adding any value to the final product as they are only just kept in the warehouse. Now to eliminate this non-value adding activity, the production team should reduce the speed of the machine so that only a decent number of products are produced at that time.

5. Variable Cost 1 The first variable cost incurred would be the cost of purchasing raw materials. This is because the level of raw materials is directly proportional to the level of output, meaning that the cost of raw materials will increase or decrease depending on the changes in the level of output.

6. Variable Cost 2 The second variable cost incurred would be the sales commission. There would be a certain commission percentage given to employees who come up with the most innovative and unique product designs leading to an increase in the number of sales. Commission is important as it serves as a financial incentive to motivate employees and bring out the best in them.

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Business Plan

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7. Fixed Cost 1 During the business expansion process of Lavish Home Decor, new production equipment will have to be acquired. The cost of production equipment can be classified as fixed because these costs have to be paid for regardless of changes in business activity. This cost will have to be paid by the company, independent of any specific business activity.

8. Fixed Cost 2 For the uniqueness of the products to be maintained and also to come up with new designs, the company will be hiring a new design team. So, the salary paid to the entire design team will be the second fixed cost incurred because it will have to be paid to the design team no matter if the business is making a profit or not.

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Business Plan

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9. Define CSR in your business setting Corporate Social Responsibility or CSR makes for eminent business sense as well when one considers the knock-on effect that social and environmental responsibility brings to the businesses(Prachi Juneja,2015). Lavish Home Decor has always paid attention to its Corporate Social Responsibility(CSR) because it is always important for both the customers as well as the company. It is very much important as it directly improves the company's reputation in front of the consumers and motivates the workers as well. Lavish Home Decor many times modify its business strategies taking care of the society and environment. Lavish Home Decor has successfully done this by doing the following:1)The company has invested in the most eco-friendly machines which do not cause any kind of air pollution at all. This helps to maintain a clean environment and good health of the workers as well. 2)The enterprise also recruits a few young interns every year to work under experienced employees, learn from them and become better and prepared for their future. 3)Lavish Home Decor donates 5% of its total sales every year to the Jumeriah Mosque in Dubai for its maintenance as the first branch of Lavish Home Decor was established in Dubai itself. 4)The company plants 8-10 trees quarterly wherever it finds a barren land and planting trees is permitted on that land.

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10. Environmental/resource impacts Although an industry does seem to have a positive correlation with our everyday lives, there is an extremely negative impact of the growing industry on the environment(Katheryn Facelle,2017). Similarly, Lavish Home Decor impacts the environment both negatively as well as positively. The release of gases from moulding and welding machines exit through the exhaust fitted on the roof of the factories. These gases pollute the air and cause harm to human health. To fix this, the company has fitted air filters in the exhausts so that the least polluted air is released from the exhausts. By taking this step there has been less effect on air pollution because of the gases released from the machinery. Although, there is a lot of wastage of the raw material used in the manufacturing and designing of the final product. This is because the designs are very much complicated that the raw material(metal sheet, timber wood, etc.) used is moulded in the exact design and the rest of the material is wasted and dumped. Also one of the raw materials of Lavish Home Decor is timber wood so it involves cutting of different kinds of timber trees depending upon the products. To balance this, the company plants 8-10 trees quarterly wherever it finds a barren land and planting trees is permitted.

11. Community impact & engagement The environmental impact by Lavish Home Decor definitely affects the local community as the manufacturing unit causes air pollution harming the local community's health. This air pollution also causes global warming as there are different kinds of gases released in the air. As we know it on Earth, Global warming represents a very real threat to life(Rachel Greenberg,2014). To balance the effect of this, the local community can control or reduce the use of devices, vehicles or anything that contributes towards global warming. This can be done by educating the local community and spreading awareness among them about this cause as it ultimately affects their lives only.

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12. Internal stakeholders Besides the potential loss of socially conscious consumers, CSR impacts a business’ ability to attract top talents and affects employees’ job satisfaction levels and retention rates(Mondo, 2016). In other words, CSR positively affects the employees of the company. It raises their morale and motivates them to put in the best they can in the work they are doing for the company. The potential CSR impact actions the show this is that the company mostly eco-friendly machinery taking care of good health of the employees and also the company recruits young and talented interns every year showing that each and every employee is valued in the company. CSR activities focusing on sustainability issues may lower costs and improve efficiencies as well(Ron Robins, 2015). This is how CSR also affects the profitability of the organization. Also, CSR builds up a positive image of the company in front of the customers resulting in higher sales and loyalty of the customers as well, which leads to profit maximization. The potential CSR impact action showing this is that the company using the most efficient machines and most importantly it plants 8-10 trees every quarter of the year showing concern for the environment.

13. Describe how the success of your business and business idea will be measured The business idea proposed will bring a drastic change in the designs of the products which will attract more and more customers to buy them. By following and implementing this idea, the company will make higher profits in the long run which will show the success of the business idea(Financial Value). Taking care of the gases released in the air will positively impact the local society. Also, the company plants 8-10 trees quarterly, this shows its positive impact on the environment (Social and Environmental Values).

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14. Performance Measure - Financial Profit: By measuring the profit generated from the reduced costs of manufacturing the products after buying the latest machinery helps the company to assess its performance. This will ultimately result in profit maximization for shareholders and there will be even more funds for expansion and diversification of the business. It is very much important to measure the profit generated from the reduced costs of manufacturing the products because this will suggest the company about the future steps to be taken in order to increase the overall profit of the company.

15. Performance Measure - Non-financial 1 Goal 3: Good health and well-being This goal is related to ensure healthy lives and promotes well-being at all ages. Our company keeps a check on the air quality, cleanliness and that industrial waste is dumped properly without any residue left. This helps in the improvement and good health of local people and employees of the company. It also reduces the number of sick people due to poor and unhealthy environment. This goal is important for the business as it ensures a proper and healthy working environment for the employees.

16. Performance Measure - Non-financial 2 Goal 8: Decent work and economic growth This goal promotes controlled, inclusive and sustained economic growth, full and productive employment and work for all. Lavish Home Decor recruits new workers, give them opportunities and prepares them for a better future. This goal is important for the business as it keeps the employees motivated and they feel their importance/value in the company.

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17. Performance Measure - Non-financial 3 Goal 15: Life On Land This goal is related to the protection, restoration, and sustainability of the terrestrial ecosystem. Lavish Home Decor has proper dumping land to dump the industrial waste that is produced in the factory. It does not dump its industrial waste on any kind of land which will affect the land negatively. Also, the company plants 8-10 trees every quarter. This goal is important for the business because it builds a positive image of the company in front of consumers and keeps the environment healthy.

Reference List 1. Facelle, K,2017 The Impact of Industry on the Environment , viewed 6th April 2020 2. Greenberg, R, 2014 The Environmental Impact of Manufacturing from the Industrial Revolution to Automation and Everything In Between , viewed 6th April 2020 3. Juneja, P, 2015 The Business Need for Corporate Social Responsibility , viewed 6th April 2020 4. Mondo, 2016 Corporate Social Responsibility: What it is, Why it Matters, & How it Impacts Business , viewed 8th April 2020 5. Robbins, R, 2015 Business Ethics- The Magazine Of Corporate Responsibility , viewed 8th April 2020 6. United Nations,2015 Sustainable Development Goals , viewed 7th April 2020

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