Business Plan Analysis

Mission Statement: 

· Micropocket’s mission statement is to “create a smudge free life.”

Product info: 

· Our product is a pocket inset made of a microfiber material which aims to prevent smudge from smartphone screens, glasses and items similar.The insert would work with clothes such as shirts, pants and jackets. In order to make our product work, the pocket insert  will have magnets that help keep it stable and securely placed in your original pocket.

 

Legal Structure:

· We chose our legal structure as a C Corp because we think it suites are business the best. It has some advantages and disadvantages, some of the advantages are limited liability this applies to directors, officers, shareholders and employees in the company. Another advantage is that even the owners leave the company it keeps existing. C Corps have unlimited growth potential some tax advantages and no shareholder limit until the company reaches $10 million in assets and 500 shareholders it is required to register with the SEC.

Becoming a C Corp also has some disadvantages to it some of these are double taxation, regulations and formalities and unlike an S Corp shareholders can’t deduct losses on their personal tax returns. C Corps are usually more expensive to start and there are fees that needs to be paid to the state which the corp operates. C Corps experience more government control due to complex tac rules.

 

 

Risk Management and Exit Strategy

If the board feels like the company is not going to survive, the company will be liquidated and sell assets and shares immediately. If the company successfully manages to survive and grow our exit strategy will be acquisition  by a bigger company.

 

Code of ethics

As a company we will establish an ethical culture to do that leaders, managers and supervisors of the company will keep commitments, set a good example, provide information and support our organizational standards. Our employees should consider ethics in decision making, set a good example of ethical conduct and support our organizational standards. As the company grows we shall establish a code of conduct and implement an ethics training program.

Potential Competitors

§  Toddy Gear- small business that began seven years ago with one simple goal—to clean screens effectively and fashionably, enhancing your favorite gadgets. With that, the Toddy Smart Cloth was born, the world’s first premium, dual-sided microfiber cleaning cloth for removing dirt, grime, and fingerprints from smartphones, tablets, computer monitors, eyewear, and more.

§  Glasses wet wipes/spray companies- basically every company who sells their products in retail stores and online.

§  Eyewear brands who manufacture their own microfiber cloths.

o   Porter’s Five Forces

§  Rivalry Among Competitors: Moderately High- According to our industry analysis, there are many competitors in the industry that our firm will be competing against. The industry is growing slow and consumers can easily switch to a competitor offering for little cost which means switching costs are low. Rivalry is relatively intense because competitors are likely to engage in advertising and price wars. However, we believe that our product is more unique and innovative from the other products in the industry. Our company aims to disrupt the market with our innovative product, Micropockets. (When brand loyalty is taken into consideration in the case of rivalry…, quality differences)

§  Threat of Substitutes: Moderate- The substitutes for our product in the industry are not too many, however, a substitute for cleaning smudges and fingerprints off your smartphone or glasses would be using a piece of cloth (pants or t-shirts) to clear the smudges off. People commonly use wet wipes as well, but these substitutes are not really cleaning off the microbes or dirt from your smartphone or glasses. Using a microfiber cloth is more effective for smudges or fingerprints. In this case, our company aims to create a willingness to pay for our product in order to make sales and profit. As more people become interested and use our product, we must make sure that we deliver the value of effectively cleaning off the smudges so that people will buy our product instead of using the substitutes for free. As a company, we will differentiate Micropocket by offering an impressive reason for willingness to pay.

§  Bargaining power of buyers: High- According to our analysis in the buyers’ side of the industry, the power of buyers is high for our product. There are high number of customers that we are targeting, and we want to make sure that customers will keep using our product. In this case, we aim to have a reasonable price for our product. Customers who pay for our product will ask themselves the question of whether the product is effective and convenient or not when using it and is it worth it to spend $x instead of doing it for free (pants, t-shirts) or use another competitors’ product.

§  Bargaining power of suppliers: Low- According to our analysis in the supplier side of the industry, we realized that there are many suppliers of microfiber cloths and magnets to buy our materials from. If we cannot negotiate with our suppliers in pricing or delivery means, we can always switch to another relatively easily and quickly.

Operations: 

· Location 

· Industrial Park?

· Our company will be situated in the Highland Corporate Park located at Cumberland, Rhode Island where we plan on leasing a 5,150 SF warehouse space that would work as a sale and distribution location.  

· Methods of Distribution

· Our business will be conducted through our online website where our customers are able to place the micro pocket at their leisure. This allows our customers to have the option of choosing different size of cloth, color, and shape at their fingertips as well as see our newest deals and sales from the comfort of their home. This will encourage our customers to buy the Micro Pocket more often than they would if they had to do the time consuming task of traveling out of their way for a product that could be sold online. In the long run our online service will increase our sales by a substantial margin. All you need is a credit card, paypal account, checking account, or some other online financing option, making it the most convenient way of buying. Once an order has been placed their package will be assembled by us personally and shipped through the United Postal Office. This allows us to minimize the amount of employees we have to hire, assisting us in cutting back on costs. Having an online-ordering-service allows us to accurately keep track of how much we sell, which is very beneficial when ordering new inventories, as well as planning new marketing strategies based off where and to who are product is selling more.

·  Patent

· By issuing a utility patent for Micro Pocket we will protect our creation of a new or improved-and useful-product prohibiting other individuals or companies from making, using, or selling the invention without authorization.