Busness Plan, Sample of Business plans

22 pages, 10766 words

NANO TEXTILES – MAGIC FABRIC: BUSINESS PLAN

SUBJECT/ MODULE | ENTREPRENEURSHIP |

SYNDICATE: | LudweSolwandleThembelaMabandla |

SYNDICATE STUDENT NUMBERS | 198419179455 |

DUE DATE | 02 NOVEMBER 2012 |

SIDNATURES: | LudweSolwandle___________________ThembelaMabandla__________________ |

1. EXECUTIVE SUMMARY

2. THE INDUSTRY, COMPANY AND ITS PRODUCT(S) OR SERVICES

3. MARKET RESEARCH AND ANALYSIS

4. THE ECONOMICS OF THE BUSINESS

5. MARKETING PLAN

6. DESIGN AND DEVELOPMENT PLANS

8. MANAGEMENT TEAM

9. SUSTAINABILITY AND IMPACT

10. OVERALL SCHEDULE

11. CRITICAL RISKS, PROBLEMS, AND ASSUMPTIONS

12. THE FINANCIAL PLAN

13. PROPOSED COMPANY OFFERING

14. APPENDIXES

1.1 Objectives

The company objectives are:

* To be a top furnisher supplier to luxury homes in the regional market.

* Revenues to more than double Year1 levels by the end of Year2.

* Aim to have 70% of sales in high-end residential customer segment.

* 20% of sales in mid-range residential customer segment.

* 10% of sales in commercial development segment.

* To have a showroom within 3 months in a prominent retail space

Vision

* Black and White Designers will be a highly visible creative and designer company known as the best designer, manufacture, supplier and distributor of designer furniture for a high end consumer market segment.

20 pages, 10000 words

The Business plan on The Boeing Company Marketing Policy

CONTENTS 1. COMPANY OVERVIEW... p. 3 to 4 Company's vision, mission statement and objectives Vision... p.3 Boeing- Airbus market share... p. 42. SITUATION ANALYSIS... p. 5 to 10 PEST analysis...p. 5 SWOT analysis... p. 7 Boeing Corporate Culture... p. 103.THE BOEING COMPANY MARKETING POLICY... p. 11 to 30 Segmentation... p. 11 Boeing's Positioning and Targeting Strategy...p. 12 Buyer behaviour... ...

* We have developed a comprehensive range of designer furniture and marketed these products in all marketing mediums, retail, trade shows, magazines, presentations, events and road shows country wide, becoming a leader in design, manufacturing, distribution and supply of custom made furniture.

* We will be actively promoting BBBEE, community service and social responsibility programs though sponsorships, contributions and donations to community projects, education institutions and to entrepreneurs.

Mission

In order to achieve our vision Black and White Designers commits to the following:

* Our mission is to produce creative, unique, trendy, innovative and distinctive products that meet market demand and fulfilling customers’ needs and providing the intended solution to the client.

* We believe our first responsibility is to the client that uses our products and services. Our strong financial position will enable us to display our products in show rooms and retail outlets in nine (9) provinces of South Africa.

Values

* In carrying out our day to day business we strive to:

* Treat our employees as our equal and partners

* Follow the philosophy that our customers deserve only the best service

* high level of competency and excellence

1. EXECUTIVE SUMMARY

1.1 Description of the Business Concept and the Business Opportunity and Strategy:

* Black and White Furniture Designers is an innovation company that has conceptualised the application of Nano Technology in furniture manufacturing, textile and clothing industry.

* An important opportunity for the application of Nano Silicon Dioxide and other Nano specialist finishing agents and coating agents for textiles, wood and metal have been identified by Black and White Designers in South Africa and Africa.

* There is a constant risk of infection in our environment (at home, in the office space, health facilities etc), thus increase in mortality rate and a high degree of environmental pollution and contamination thus increase in global warming.

4 pages, 1707 words

The Term Paper on Technology 3 2

What is technology? Technology as applied science and engineering clearly presents a relevant but limited view. It is, perhaps, a better definition of 'technique'. The notion that what designers do with technology is to simply apply scientific knowledge would be to misunderstand both what science and technology is. While the issue of science will be addressed below, suffice it to say that because ...

* The innovation and invention of applying Nano technology in the furniture, clothing and textile industry will change the way we manage our environment and living space, this will improve our health standards and life expectancy, eliminate risk of infection and improve quality of life.

* Black and White Designers was established in January 2012, the firm was formed to design and manufacture trendy, premium and custom made furniture.

* Black and White Designers is in a start-up stage. We have manufacturing factory in Port Elizabeth and Cape Town. We have five (10) sales representatives nationally and five (5) furniture designers and manufactures and five (5) fashion designers. We have three (3) business executives i.e. Managing Director, Finance Executive, Marketing and Sales Executive.

* Our products are premium and exclusive for a niche market and high end consumers because we apply an eco-friendly, environmentally friendly and Green Nano technology specialist coating and finishing agents in our manufacturing process that makes our products premium and exclusive.

1.1.1 The opportunities and Strategy

* There are opportunities and huge potential for a health conscious product, including material and finishes that do not adversely affect health, environment, nature, and life style. Nano technology coating and finishes in our products have anti micro-bial properties, bio degenerate, and are made from a natural material Silicon Dioxide and Rock.

* Customisation of products for local market e.g. product flexibility and versatility allowing changes in design, dimensions, size, material and style to meet customer’s needs.

* Collaboration with architects, interior designers, furniture designers, and fashion designers offer black and white designer an opportunity to market and position Nano technology as an exclusive, premium and elite product, thus positioning our products for a higher end niche market.

* There is opportunity for environmentally sustainable products; we use Nano technology coating and finishing agents that are harvested from natural material, i.e. on stone.

10 pages, 4576 words

The Term Paper on Project On " Arvind Mill" ( The Product Mix And Its Strategy)

PROJECT ON “ARVIND MILL (THE PRODUCT MIX AND ITS STRATEGY)” Master of Commerce Semester-I (2013-2014) Submitted In Partial Fulfillment of the requirements For the award of degree of M.Com-I By Suraj Shridhar Tripathi Seat No: _______ Tolani College of Commerce Sher-e-Punjab society, Andheri (East), Mumbai-400 093 PROJECT ON “ARVIND MILL (THE PRODUCT MIX AND ITS STRATEGY)” Master of Commerce ...

* Our organic Nano textiles, recyclable Nano technology coating and finishing agents are eco-friendly.

* All our wood products are produced and harvested locally according to forest stewardship practices therefore our manufacturing and production is sustainable.

* New technology is driving the use of new materials and increase integration of furniture with appliances and devices.

* There is a global increase in emphasis on environmental and health standards (strongest in the developed country markets) including sustainability of material used, used of recycled material or recyclability of products and avoidance of toxins.

* Increase in the use of internet to compare products is placing pressure on price and increasing the importance of web presence.

* Media influence is resulting in consumers placing greater value on décor and becoming more trend conscious.

* Demographics shift change furniture requirements-consumers prefer more multipurpose furniture.

* The entry strategies is product positioning, position our products in the market as premium and exclusive for an elite market niche and maintain Nano technology products exclusive to Black and White Designers through a sole suppliers and trade secret agreement between Nano Land South Africa and Nano Land Global.

* There are many reasons for the poor performance of the furniture sector, including the following:

* Increased global competition and growth in imports, especially from China (which also linked to the level and volatility of Rand whereby frequent fluctuations in the Rand value complicates the pricing of products for both export and domestic consumption and increase the potential risks of export activities).

* Inability or unwillingness of local manufactures to produce new, innovative and cost-effective designs which are informed by global trends which includes:

* A movement away from wood products and towards the use of new material which include plastic, polypropylene, metals, glass ect.

11 pages, 5053 words

The Essay on Nano Technology 2

18 seems to be the magic number in today's manufacturing process. Intel and AMD both boast their upgraded production, and note that it will lead to ever increasing speeds and capabilities. Quietly, however, there is a growing consensus among the scientific community that silicon based-chips are on their way out. Tiny, molecular computers are becoming more and more feasible, and may do to silicon ...

* And moving towards more basic designs and cheaper ranges due to the global recession.

* Growing interest in green and sustainable furniture such as eco-friendly furniture with major importance such as changes in raw material being used including the use of either recycled or re-purchased material, the use of locally produced raw material with lower carbon foot print (e.g. bamboo) the use of raw material which are more durable or lasting longer and which have a longer functional life span which contribute to the health of the planet by not adding to the landfills.

* Designs that do not use excessive space when transported e.g. kit design and is also more efficient by providing greater utility for the customer by having multifunctional applications.

* Sustainable and responsible manufacturing practices, involving renewable energy source in production, recourses efficient- re-conserving natural resources, re-use energy, water and materials, no exploitation of labour and there should be some way to recycle the products at the end of its life cycle.

* Marketing, branding, labelling and positioning of the products.

* Growing use of modular, flexible furniture designs which allows furniture components to be used in different combinations.

* Manufacturing competitiveness which is linked to no or under investment in new machinery. This lack of investment in the required operating skills and unavailability of key skills sets which are often required to support new product development and design innovations including the use of new and innovative materials.

* Relative lack of government support at a provincial level to promote exports in established and new markets through supporting by participating on prioritised furniture trade fairs and exhibitions.

* In the future, green retailing is also likely to become a more dominant trend and manufactures will need to become more pro-active in responding to retailers requirements. Green retail trends include the following:

* Corporate social responsibility

* Sustainable facilities

* Measuring carbon foot print

* Green merchandising

* Green marketing

* Green washing

20 pages, 9702 words

The Term Paper on Market Analysis Strategy Basic Product

MARKET ANALYSIS 1. 1 MAREKT SIZES AND TRENDS The market for the product can be divided into two segments: the Consumer and the Business Segments. Within the consumer and Business segments, it can be further segmented into four different sub-segments each, based on different characteristics or profile of the sub-segments. 1. 1-1 BUSINESS SEGMENTSThe market size of the Business market has grown from ...

* The importance of business transparency

* Sustainable distribution

* Growth and specialist green chain

1.1 The Target Market and Projections.

1.2.1 The target market and projections

1.2.1.1 South African furniture market

Furniture consumption is SA currently amounts to approximately R9.78 Billion, which is relatively low to other markets. There was a large decrease in local demand for furniture during 2008/2009, but demand is likely to get stronger in the medium term-expected to grow approximately 2% to 3% in real terms.

2008/2009 | 2009/2010 | 2010/2011 | 2011/2012 | 2012/2013 |

1.2.1.2 The target market:

The continued growth of the black middle and upper class has been, and will remain a key demand driver.

The consumption pattern of this growing middle and uppers class will favour growth in the furniture sector-for example; it is estimated that the wealthiest 20% of black consumers spend 2% of their income on furniture, compared to 0.81% among the wealthiest white consumers.

South Africa imported R2.35 Billion in 2009, making it a net importer ( note that imports could be valued at wholesale price, while the basis for valuing consumption above is unclear), however, it is likely that consumption is measured in retail price if one assume an average mark-up of 50% this would mean around 36% of the market was served by imports vs. 64% local supply, whereas at an average of 100% mark-up, this would mean that the market was served half-half by imports and local supply.

1.2.1.3 The market segment:

Furniture market can be segmented according to type of customers, including:

* Residential market

* Low end residential market segment

* Mid end residential market segment

* High end residential market segment

* Commercial market, including offices, hospitality (e.g. hotels, resorts) and recreation (e.g. theatre).

* Public sector and civil society market, including health facilities, schools, churches.

* The transport sector also represents an important market for furniture (e.g. boats, aviation).

5 pages, 2155 words

The Business plan on Alpha Audio Product Market Industry

ALPHA AUDIO Executive Summary ALPHA Audio, a leading global electronics manufacturer, is going to produce the innovative and exciting car audio compact disk recorder and receiver. This product will be capable of recording music off the radio and engraving it onto a compact disk for later listening enjoyment. When the consumer hears a song on the radio that they like, they will press the red, ...

* Individuals

* Age: 30-40

* Sex: Mostly Female

* Income: R25 000.00 p.m. +

* Professional Class: Tertiary Education

* Geographic Area: Urban and Peri-Urban

More particular, each market segment has a somewhat different basis of competition and will present challenges in order to succeed. Some thoughts on these issues are presented in the table below:

Market Segment | Challenges |

| |

Low end residential | Cost of input |

| Scale and efficiency of production ( capacity to deliver 1000 unit) |

| Efficiency of logistics and distribution systems |

| Meeting small scale and multi functional requirements |

| |

Mid end residential | Value for money ratio (cost-quality balance) |

| Responsiveness to market shift e.g. change in demographics |

| |

High end residential and commercial | Maintaining cutting edge designs that matches global standards whilst offering something unique |

| Production quality and artisans excellence |

| Relationship with key buyers locally and internationally |

| Standards compliance e.g. environmental |

| Brand building and marketing |

| |

Public procurement | Cost competitiveness |

| Ability to meet scale and delivery periods |

| Compliance with tender requirements e.g. TAX and BBBEE |

1.2 The Competitive Advantages.

* Our Nano technology coatings have been proven to be 99% effective against all of these microbes prevalent in hospital and other healthcare environments.

* An additional benefit is that of mite (s) resistance-important in the prevention of allergies such as asthma.

* Nano technology provides us with special finishing’s and products in the furniture and textile industry that gives us the edge in high end consumer markets.

* Specialised Nano technology finishes and coating applied to furniture or textile are gaining popularity globally and are designed for greater consumer comfort, durability and value for money.

* All products that are treated with Nano technology coating and finishes are eco-friendly, environmentally friendly and bio-degradable and energy efficient.

* The treated products do not require as much water, detergent and energy to clean it.

* Studies have shown that Nano technology treated products cut water and energy consumption in half and reduce detergent need by 90%.

* Our oil, stain and liquid repellent finishes can survive up to 50 washing cycles and the treatments are all bio-degradable. The volume of chemical leaching into water course is miniscule (very small); compare that with quantities of bleach, detergents, and other toxic chemicals thrown down the drains of households around the world.

* Nano technology is changing how we manage our environments, offering a replacement to aggressive cleaning chemicals, new solution for infection control, asset protection, public health and food hygiene.

* Nano technology add outstanding properties to our products, our products are lighter, stronger, healthier, smaller, more durable and safer.

The Competitive Advantages

* The smart Nano technology enabled systems are able to perform and form highly functional material in the world giving humanity means of improving the manner of living, quality of life, health standards, and their impact on nature and the planet.

* Nano technology is a natural material-it substitute’s material made from oil particles, plastic and artificial fabrics; with eco friendly alternatives by using natural materials such as thick cotton, paper, natural wood, and stone without relying on contestant renewable resources.

* The coating does not contain toxic chemicals due to the fact that they are produced from earth most abundant virgin (raw) material in particular sand, pure (quarts) glass and silicon dioxide (SiO2).

* In addition, the liquid glass coatings possess similar properties of glass with typical characteristics of durability, inert and highly resistant to acid and chemicals.

* In exception, the coating is 500 times thinner than human hair (approximately 100 nanometres) flexible, breathable and does not emit loose Nano particles.

1.3 The Team.

Thabo Roloma- Managing Director

* Thabo Roloma is a trained Clinical Engineer and Entrepreneur; he studied clinical engineering Pretoria Technikon and worked for Respiratory Care Africa (RCA) and Unicore Trading as a clinical Engineer for five (5) years and one (1) year respectively.

Brief Description

* The position of managing director consist of determining and formulating policies and proving the overall direction of companies or privet or public sector organizations within the guidelines set up by a board of directors or similar governing body.

* It also consists of planning, directing, or coordinating operational activities at the highest level of management with the help of subordinate executives and staff managers.

TASKS

* Analyze operations to evaluate performance of a company and its staff in meeting objectives, and to determine areas of potential cost reduction, program improvement, or policy change.

* Appoint department heads or managers ad assign or delegate responsibilities to them;

* Confer with board members; organization officials and staff members to discuss issues, coordinate activities, and resolve problems.

* Direct and coordinate activities of business or departments concerns with production, pricing, sales, or distribution of products.

* Direct and coordinate an organisation’s financial and budget activities to fund operations, maximize investments, and increase efficiency.

* Direct human resource activities, including the approval of human resource plans and activities, the selection of directors and other high-level staff, and establishment and organization of major departments.

* Direct, plan and implement policies, objectives, and activities of organizations or business to ensure continuing operations, to maximize returns on investments, and to increase productivity;

* Negotiate or approve contracts and agreements with suppliers, distributors, government and state agencies and other organizational entities.

* Prepare budges for approval, including those for funding implementation of programs.

* Review reports submitted by staff members to recommend approval or to suggest changes.

SiphokaziNxiweni-Financial Director

* SiphokaziNxiweni is a qualified Auditor and Project Manager; he studied at the University of Port Elizabeth.

Brief Description

* The position of finance director consists of directing and coordinating financial activities of workers in a branch, office, or department of an establishment such as branches bank, brokerage firm, risk and insurance department, or credit department.

Tasks

* Approve, reject or coordinate the approval or rejection of line of credit or commercial, real estate or personal loans.

* Establish and maintain relationships with individuals or business customers or provide assistance with problems these customers may encounter.

* Establish procedures for custody or control of assets, records, loan collateral, or security to ensure safe keeping.

* Examine, evaluate or process loan applications.

* Network with communities to find and attract new business.

* Oversee the flow of cash or financial instruments.

* Plan, direct or coordinate the activities of workers in branches bank, offices, or departments of establishment.

* Prepare financial or regulatory reports required by laws, regulations or board of directors.

* Recruit staff members and oversee training programs.

* Review collection reports to determine the status of collections and the amounts of outstanding balances.

LudweSolwandle-Marketing Executive

* LudweSolwandle is a qualified Investor and Banking Executive and Project Manager; he’s got management qualification from the Gordon Institute of Business Science (GIBS) and is currently reading for MBA at the Milpark business school.

Brief Description

* The position of finance director consists of directing and coordinating marketing activities of workers in a branch, office, or department of an establishment such as branches bank, brokerage firm, risk and insurance department, or credit department.

Tasks

* Approve, reject or coordinate the approval or rejection of marketing strategies.

* Establish and maintain relationships with individuals or business customers or provide assistance with problems these customers may encounter.

* Examine, evaluate or process sales and marketing strategies.

* Network with communities to find and attract new business.

* Oversee the flow of cash or financial instruments for all marketing activities.

* Plan, direct or coordinate the activities of workers in branches bank, offices, or departments of establishment.

1.5 The Offering.

2. THE INDUSTRY AND THE COMPANY AND ITS PRODUCT(S) OR SERVICE(S)

2.1 The Industry.

Current status and prospects

The furniture industry in South Africa sits firmly within the manufacturing sector of the national economy. The industry consist of manufactures that make a large range of furniture, using low technology and high skilled craftsmen at one end of the spectrum and highly mechanised, high volume manufacturing at the other hand. Despite its low contribution to DGP (contributes 0.3% to the national GDP and 1.6% to the manufacturing GDP in 2007-IDC, 2008), the furniture industry is an important sector in South African economy. It currently employs about 46 000 people, but with proper support the industry has potential to grow and create more employment.

Furniture manufacturing is mainly concentrated in three provinces: Gauteng (37%), Kwa-Zulu Natal (KZN) (23%) and Western Cape (19) (the dti, 2005).

The remaining 21% is produced in other provinces. There are approximately 833 levy paying furniture manufactures in the country (KZN Furniture cluster, 2008).

It is understood that there are many other manufactures operating in informal setting not included in the official size of the industry. The Department of Trade and Industry (dti) view these as an indication of latent potential to be tapped into in order to increase manufacturing and increase employment by facilitating cooperation and support.

The bulk of the furniture produced in South Africa is home furniture, accounting for 85% of total production. Of the home furniture, 60% is bedding and dining room furniture. Kitchen furniture is sizeable and this is satisfied by local production. The gaps in the industry present an important opportunity for small manufactures that can use them as a stepping-stone for bigger or perhaps export markets.

The most exported furniture is other furniture (metal, wooden, plastic and other material used in the kitchen, and bedroom-this forms the bulk of the definition of furniture).

This is mainly exported to (in the order of the value of exports) UK, Mozambique, Angola and the US. On the other hand imports of this furniture come from (in the order of value) China, Malaysia, Indonesia and Italy.

The furniture industry plans to recapture a larger share of the local market as well as exploit the growth potential in the international market.

Analysis of the global market has shown in the furniture industry, by completing in the low-end of the market. This strategy takes into account the magnitude of Asia imports in the local furniture industry on higher value end of the sector. The proposed interventions will also take into account the current t state of the industry characterised by declining employment, investment.

Industry structure

There are two (2) main approaches to describe the furniture sector:

* The first is according to the primary material used to make furniture (e.g. wood, metal, glass, ect).

This is the approach used by the standard industrial classification codes which identifies three main furniture sub-sectors as follows.

* 39101 manufacture of furniture made predominantly of metals

* 39102 manufacture of furniture made pre-dominantly of plastics material

* 39103 manufactures of furniture made predominantly of materials of other than metal, plastic, or concrete (this includes furniture made from solid woods and various types of particles boards.

* The second is to describe the end-use context. Here the main categories as follow:

* Office furniture

* Kitchen

* Bedroom

* Outdoor

* Dining and living room

* Hospitality

* Retail/shop fitting

There are two (2) major sectors in the classification of furniture and these are upholstery (fabric/. Leather stretched over a frame) and case goods (made of hard material, such as wood, metal and glass) (Who Own Whom.2010).

The industry consist of manufactures that make a wide range of furniture, using low technology and skilled craftsman on the one hand, and merchandised, high volume manufacturing, on the other hand.

Size of the industry

The furniture industry in South Africa employs about 46 000 people and has over 830 registered manufactures (Who Own Whom. 2010).

Of these firm 666 (80%) are wood furniture product manufactures. This excludes unknown number of manufactures operating informal.

Furthermore

* 80% are small firms with less than 50 employees

* 15 % are medium size with 50 to 199 employees and

* 5% are large manufacturing plants with over 200 employees.

Some small wood firms achieve a turnover of up to R15 Million per year and account for 40% of furniture production; while medium size and large firms for 20% and 40% respectively.

In terms of Real Gross Value Added, the sector contributed R22.8 Billion to the national economy or 1.39% of GDP in 2010 with the following contributions. (Source WSEC analysis of Global Insight (March 2011)

Household expenditure of house hold furniture in 2009 totalled R 28.955 Billion nationally. (Source WSEC analysis of Global Insight (March 2011)

Nationally, of that total value of furniture production, 85% is homemade furniture, 60% of this is bedding and dining room furniture, with kitchen furniture accounting for most of the remaining 40% (Who Owns Whom.2010).

In value terms, office furniture represents 15% of the local furniture industry.

Furniture manufacturing is mainly concentrated in the three provinces Gauteng (around 40 %,) Kwa-Zulu Natal (around 25%) and Western Cape (around 20%).

Office furniture manufactures is South Africa are located in three (3) main areas. The Gauteng region, with Johannesburg and Pretoria industrial areas, is the key location and hosts the majority of sector companies. A relevant presence is also evident in Cape Town and Durban.

The local furniture industry is relatively small, and well established in South Africa. It employs approximately 50 000 people and is estimated to contribute 0.5% to GDP (less than 2% of manufacturing GDP).

South Africa manufactures have traditionally served local low to mid end of the market, with imports servicing the higher end of the market (national productivity institute/dti.2005).

However globalisation and the increasing capacity of low-cost, high quality manufactures in the developing countries (most notably China), have resulted in strong competition for local manufactures across all market segments.

By 2004, the value of imports had already more than doubled relative to the value of local production, (national productivity institute/dti 2005).

The intense price competition among lower end goods has meant that many of the small operators have been forced to close. Some manufactures (including large operators) have had to resort to imports parts of their production range in order to remain competitive.

Local manufacturing was hit hard by the decrease in local demand during recession. However, manufacturing is forecasted to pickup in the short to medium term-driven mainly by inventory build-ups. However, the strong Rand (making imports more expensive) as well as high electricity cost may delay the recovery somewhat.

The retail market is dominated by few large retailers. At present for big companies (Ellerines, Lewis, JD group and Shoprite) have an approximated combined market share of 80%. This dominance has lead to the reduction of importance of the wholesale sector.

Growth trends:

National growth trends

Furniture consumption is South Africa currently amounts to approximately R28.955 Billion, which is relatively low to other markets. There was a large decrease in local demand for furniture during 2008/2009, but demand is likely to get stronger in the medium term-expected to grow approximately 2% to 3% in real terms.

2008/2009 | 2009/2010 | 2010/2011 | 2011/2012 | 2012/2013 |

Nationally, the furniture sector has been struggling compared to the performance of other emerging countries. According to centre of industrial studies (April 2010), total national production is totalling only 50% higher than in 2000, whereas the aggregate supply of emerging countries increased by 3.5 times or 350% (7 times faster growth than South Africa), over the same period.

Furniture production has slowed down during recent years and the country is shifting from being a net exporter to a net importer. One of the reasons for the weak trend in domestic furniture production over recent years is enhanced sourcing activities of local manufactures. The main players include both locally manufactured products and imported brands in their portfolios in order to expand their supply with high end products from Europe and the United States, and to better compete at the upper end of the market.

Higher income consumers are demanding high end products, as well as greater range of products. On the other hand, the increasing foreign competition from China, Malaysia has forced local manufactures to expand the portfolios in the economic-budget segment (CSIL.2010).

Furniture exports from South Africa totalled R994.5 Million and reached the following markets. It is striking to the growing importance of exports to Africa countries.

In terms of furniture imports, these are currently dominated by Chinese imports: SA furniture import by market: 2009.

When comparing the performance of the top countries destinations of South African exports, over the last decade (2000-2008), it is clear that neighbouring African markets (Mozambique, Zimbabwe, Zaire and Malawi) have been increasing fast displaying number of opportunities both in the household and contracted segment (CSIL:2010)

South African furniture by segment/ product group and top three destinations

Product | Destination 1 | Destination 2 | Destination 3 |

| | | |

Upholstered Furniture | Zambia | Mozambique | Zimbabwe |

Un-upholstered furniture | USA | UK | Japan |

Bedroom furniture | Eritrea | Mozambique | Nigeria |

Kitchen furniture | Mozambique | Zaire | Zambia |

Office Furniture | Zambia | Mozambique | Angola |

Nationally, it would appear that most export destinations in 2009 for all products except non-upholstered seats are predominantly African countries.

Currently export market are predominant to various African countries (Namibia most common) and Europe, with one or two companies exporting to Australia and the Middle East.

The most commonly exported product groups are:

* Dining tables

* Dining chairs

* Living chairs

* Bedroom beds

Businesses vary in terms of how many different product groups they are exporting to their main markets. It appears that most businesses are exporting a wide range of product group.

2.2 The Company and the Concept.

* Black and White Designers is an innovative company that has conceptualised the application on Nano technology in manufacturing of green sustainable custom made furniture, to produce eco-friendly furniture, environmentally sustainable furniture using recycled materials or recyclable products, innovative and cost effective designs that are practical and have multipurpose applications.

* Black and White designers intends utilising sustainable and responsible manufacturing practices, involving renewable energy resources in the production process, re-conserving material resources, re-use energy, water and materials.

* Practice best business principles including NO exploitation of labour, compensable labour according the bargaining council remuneration standards, green marketing and merchandising, and business transparency and corporate social responsibility programmes.

* All our products will be re-cycled at the end of their life cycle.

* Black and White Designers will offer trendy, innovative, premium and exclusive residential and commercial furniture, that is designed, produced and manufactured locally using sustainable green sourcing of raw material.

* and produce furniture that is:

* 99% effective against all of these microbes prevalent in hospitals and other health environments and additional benefit is that of prevention of allergies.

* Nano technology treated furniture cut water and energy consumption by half and reduce detergent need by 90%, thus the volume of chemicals leaching in our water course is minimised, compare that with quantities of bleach, detergents or cleaning agents and other toxic chemicals thrown down the drain of households around the world.

* Black and White Designers principal customers is individuals with the following demographic data:

* Age 30-45

* Sex mostly female

* Income +R25 000

* Education Diploma, Degree

* Profile Professional

* Location urban area, commercial and institutions

Background

* In 2010, Black and White Designers recruited fashion designers from Walter Sisulu University of Technology and started a small scale fashion design and production in East London.

* In 2011, we recruited and formed partnership with furniture designer (Bhayi Mark Upholstery) and started trading informally, and became a supplier of the interior designer retail store called Casa Viva in Port Elizabeth.

* In 2012 we registered Mothitron (pty) ltd a private company, trading as Black and White Designers.

* In 2012 we have recruited and partnered with William Ling from (Charlie Rose inspired designs) a furniture and interior designer and formed business partnership for designs, concepts and virtual show room.

* In 2012 we partnered with Nanoland South Africa to access Nano Technology products and to produce Nano Fabric with the exclusivity agreement with Cedarbrook a fabric manufacture in Cape Town.

* Thabo Roloma the founding member of Black and White Designers in collaboration with a doctor Norman Maharaj, fashion designer, SisandaFuncuza, a furniture designer, William Ling, a furniture manufacture Ernest Dyantyi, a graphic designer SipheleleMdlankomo and mechanical engineer SipheloRoboji developed a new range of Green Nano Technology furniture to be manufactured and distributed by Black and White Designer.

* In 2012 we affiliated to the professional body of furniture manufactures in the Western Cape, Western Cape Furniture Initiative (WCFI)

Setbacks or losses in prior years

* The biggest financial loss was in December 2011, when we paid Ngavu enterprise Three Thousand Rand (R3000.00) for website design, domain hosting and printing of marketing material (catalogues, and business cards).

Ngavu enterprise never delivered the services; we have to go through the legal route to recoup the funds, after exhausting all the avenues in mid 2012 we decided to write off the debt (bad debt).

* One of the financial setbacks was in January 2011, when we delivered dining chairs to East London, using our own delivery vehicle, the chairs fell off the delivery car and were damaged, and we had to pay for the repairs and reconstruction of the chairs.

* Market setback, on the customer service side, we did not collect, record and keep accurate customer data for the past two (2) years i.e. customer location and contact details.

* The biggest setback is in our finance department, we did not keep accurate financial records, financial statements, transaction history, and financial performance of the business.

* The business location in Eastern Cape, Port Elizabeth limited business growth, market access, because furniture design and manufacturing in South Africa is dominant in three (3) provinces i.e. Gauteng (37%), Kwa-Zulu Natal (KZN) (23%) and Western Cape (19%) (The dti, 2005).

The remaining 21% is produced in other provinces.

* Our business model as a manufacturer of custom made furniture and producer of denser clothing limited our ability to be focused on a specific target market and market segment, and ability to enter and penetrate key markets.

Future efforts to prevent recurrence of these difficulties and to improve of performance includes,

* Writing contract and stating measurable deliverables for all service providers and signing a service level agreement.

* All business assets are insured through a business insurance company and logistics is outsourced and all delivered items are comprehensively insured.

* To prevent losing valuable customer data and information, and business financial records we have implemented two (2) accounting packages i.e. Pastel accounting online and FNB instant accounting.

2.3 The Product(s) or Service(s).

The core business of Black and White Designers is to design and manufacture modern and contemporary style furniture using the best technology in the industry and utilising Nano technology to make our products premium, eco-friendly, environmentally friendly, and a solution to infection control.

Nano-Technology is viewed as sign of design, the ultimate design tool on the leading edge of technological innovations.

The smart Nano-enabled systems are able to perform and form highly functional material in the world giving humanity means of improving the manners of living, quality of life, standard of health and their impact on nature.

Our Nano-textile the magic fabric and Nano technology coating and finishes differentiate our products to those of the competitors.

At Black and White Designer, we design and manufacture the following Nano-technology based furniture category:

* Lounge furniture

* Dining furniture

* Bedroom furniture

* Office furniture

* Kitchen furniture

Black and White Designers furniture is ergonomically and economically designed to create comfort and relieve stress to the consumer, and a solution to residential or commercial environment in terms of health, hygiene and space issues.

Product Description

* The unique features of Black and White Designers furniture is economic and ergonomic design, trendy and innovative designs, and application of innovative, sustainable and green, eco-friendly, environmentally friendly and 100% natural Nano Technology coating and finishing agents that differentiate our products from that of the competition and give us competitive edge and product positioning as premium, innovative, “green”, trendy and exclusive.

* Nano technology, green technology and sustainable green sourcing of material will give us advantage in positioning and penetrating the high end consumer market.

* Consumers will reduce water and energy consumption by 50% and reduce detergent use for cleaning by 90%.

* Consumers will eliminate cross infection and environmental contamination and reduce mites that cause allergic reactions that cause asthma.

* The possible draw back in our products is the introduction of very advance and elite Nano technology in a market that is far behind in technology, innovations, education and environmental issues consciousness.

The present state of development of Nano Tech furniture is in the advanced stage, research and development of the best Nano technology coating and finishes has been completed and the application of finishing agents in combination, for example antimicrobial finish and perfume finish has been completed.

* Development of Nano Tech fabric that is heat resistant and UV protective is underway in Cape Town in collaboration and partnership with local fabric manufactures.

2.4 Entry and Growth Strategy.

As manufacturers of unique furnishers aimed at the higher end of the market our approach is not volume sales but rather that of high margin targeting as such Black & White Designers will enter the market with a Niche Focus approach.

Growth Strategy:

* Maximise revenue from existing customers by developing new products.

* Provide customised solutions to the industrial customers.

* Develop multi-branding strategy with a premium brand.

* Expand Offering in neighbouring countries and foreign markets

* Market entry into related businesses.

3. MARKET RESEARCH AND ANALYSIS

3.1 Customers.

Our target market and customers is the wealthiest 20% of black consumers that spend 20% of their income on furniture e.g. Black professional with income of R500 000, will spend R 10 000 on furniture; a black business owner or executive with income of R1 000 000, will spend R20 000 on furniture and black politician with income of R2 000 000 will spend R40 000 on furniture.

And wealthiest white consumers that spend 0.81% of their income on furniture e.g. white professional income id R500 000, expenditure on furniture is R4050, while business executive or owner with income of R4 000 000, spend R35 400 on furniture.

The results of the LCS 2008/2009 indicate that during the period of September 2008 to August 2009 household in South Africa spend approximately R71 910 on average per annum.

Main expenditure group and Income | Average (Rand) | % |

| | |

Food and non-alcoholic beverages | R 13 914.00 | 19.30% |

Alcoholic and beverage and tobacco | R 699.00 | 1.00% |

Clothing and footwear | R 3 474.00 | 4.80% |

housing, electricity, water and other utilities | R 17 922.00 | 24.90% |

Furniture, Furnishings and other household equipment | R 3 860.00 | 5.40% |

Health | R 950.00 | 1.30% |

Transport | R 10 978.00 | 15.30% |

Communication | R 2 418.00 | 3.40% |

Recreation and culture | R 3 069.00 | 4.30% |

Education | R 2 002.00 | 2.80% |

Restaurants and hotels | R 1 697.00 | 2.40% |

Miscellaneous goods and services | R 10 715.00 | 14.90% |

Unclassified items | R 201.00 | 0.30% |

| | |

Total | R 71 899.00 | 100.10% |

Expenditure-in-kind | R 2 381.00 | 100.10% |

Expenditure including-in-kind | R 74 280.00 | 100.10% |

Income | R 90 274.00 | 100.10% |

income-in-kind | R 2 381.00 | 100.10% |

income including-in-kind | R 92 655.00 | 100.10% |

Distribution of consumption expenditure

Percentage distribution of households during the period September 2008 to August 2009 by household consumption expenditure by population group of house hold head (statistics SA LCS 2008/2009)

R 16 406.28 | 8.20% | 27.30% | 54.00% | 80.80% | 20.00% |

R 26 330.08 | 19.10% | 30.50% | 32.60% | 15.80% | 20.00% |

R 43 897.15 | 23.20% | 20.40% | 11.70% | 2.00% | 20.00% |

R 98 053.03 | 24.50% | 13.10% | 1.70% | 0.70% | 20.00% |

R 98 053.03 | 25.00% | 8.70% | 0.10% | 0.70% | 20.00% |

Percentage distributing of household consumption expenditure by province head (statistics SA LCS 2008/2009)

Expenditure | WC | EC | NC | FS | KZN | NW | GP | MP | L | Total |

| | | | | | | | | | |

R 16 406.28 | 37.50% | 12.30% | 16.20% | 13.30% | 14.20% | 13.80% | 30.50% | 14.00% | 8.30% | 20.00% |

R 26 330.08 | 24.30% | 17.40% | 20.10% | 18.10% | 21.20% | 18.20% | 23.30% | 16.60% | 12.60% | 20.00% |

R 43 897.15 | 17.30% | 21.90% | 22.50% | 20.10% | 23.30% | 19.90% | 18.00% | 21.70% | 17.70% | 20.00% |

R 98 053.03 | 12.00% | 23.40% | 22.80% | 23.60% | 22.70% | 22.60% | 14.90% | 22.10% | 26.20% | 20.00% |

R 98 053.03 | 8.70% | 25.00% | 18.40% | 24.90% | 18.60% | 25.50% | 13.20% | 25.50% | 35.20% | 20.00% |

Percentage distribution of households b=y household consumption expenditure by type of settlement head (statistics SA LCS 2008/2009)

| | | | | |

R 16 406.28 | 31.70% | 1.70% | 2.90% | 9.70% | 20.00% |

R 26 330.08 | 25.00% | 11.20% | 13.90% | 10.70% | 20.00% |

R 43 897.15 | 18.50% | 23.00% | 21.90% | 21.90% | 20.00% |

R 98 053.03 | 13.80% | 28.00% | 28.70% | 30.20% | 20.00% |

R 98 053.03 | 11.00% | 36.10% | 32.60% | 27.50% | 20.00% |

Average annual household consumption expenditure by province (statistics SA LCS 2008/2009)

Proportion of expenditure to total household consumption of furniture, furnishings and other household equipment by population group (statistics SA LCS 2008/2009)

Average annual household consumption expenditure on furniture, furnishings and other household equipment (statistics SA LCS 2008/2009)

Customer analysis

* On average South Africans have an average income of R92 655.00, the total annual consumption expenditure on furniture is 5.4% of the annual income i.e. R5003.37.

* Distribution of consumption expenditure in general Black Africans are the highest followed by Coloured, Indians and Whites. This indicates that Black Africans have bigger buying power and expenditure rate but have lowest disposable income.

* On average Black Africans spend R11 097 on furniture, followed by Coloured which spend R6 431, Indians/Asians that spend R3 440 and Whites that spend R2645

3.2 Market Size and Trends.

In terms of real gross value added, the sector contributed R22.8 Billion to the national economy or 1.39% of GDP in 2010.

Western Cape | 19.00% | | R4.33 Billion |

Eastern Cape | 7.00% | | R1.6 Billion |

Northern Cape | 0.00% | | R0 Billion |

Free State | 1.00% | | R0.23 Billion |

Kwa-Zulu Natal | 18.00% | | R4.10 Billion |

North West | 3.00% | | R0.68 Billion |

Gauteng | 47.00% | | R10.72 Billion |

Mpumalanga | 3.00% | | R0.68 Billion |

Limpopo | 2.00% | | R0.46 Billion |

Household expenditure on household furniture in 2009 totalled R28.955 Billion nationally. Expenditure of household furniture by province: 2009.

Western Cape | 11.00% | | R3.19 Billion |

Eastern Cape | 15.00% | | R4.34 Billion |

Northern Cape | 4.00% | | R1.16 Billion |

Free State | 7.00% | | R2.03 Billion |

Kwa-Zulu Natal | 12.00% | | R3.47 Billion |

North West | 10.00% | | R2.90 Billion |

Gauteng | 28.00% | | R8.11 Billion |

Mpumalanga | 8.00% | | R2.32 Billion |

Limpopo | 5.00% | | R1.45 Billion |

Furniture Sales by Province

Household furniture expenditure retail projected growth from 2009 to 2013 (2% to 3%)

South African furniture market:

2008/2009 | 2009/2010 | 2010/2011 | 2011/2012 | 2012/2013 |

Market Trends

* Nationally, the furniture a sector has been struggling compared to the performance of other emerging countries. According to the industrial centre for industrial studies (April 2010), total national production is today only 50% higher than in 2000, where as the aggregate supply of emerging countries has increased by 3.5 times or 350% (7 times faster growth than South Africa) over the same period.

* Furniture production has slowed down during recession years and the country is shifting from being a net exporter to net importer. One of the reasons for the weak trend in domestic furniture production over recent years is the enhanced sourcing activities of local manufactures.

* The main players include both locally manufactured products and imported brands in their portfolios in order to expand their supply with high end products from Europe and United States to better compete at the upper end of the market.

* Higher income consumers are demanding high end, as well as greater range of products.

* On the other hand, the increasing foreign competition from China and Malaysia has forced local manufactures to expand their portfolio in the economic-budget segment too (CSIL: 2010)

* Furniture exports from South Africa totalled R994.5 Million (117 million US Dollars) in 2009 and reached the following destinations. It is striking to see the growing trend and importance of exports to African countries.

South Africa furniture export by Market: 2009

When comparing the performance of the top countries of destination of South African furniture export, over the decade (average 2000-2008), it is clear that neighbouring African Markets ( Mozambique, Zambia, Angola, Zimbabwe, Zaire and Malawi) have been increasing fast displaying number of opportunities both in the households and contract segment (CSIL: 2010).

Average Annual growth rate of export market

South African furniture export destination change: 2000-2008

Change by Market

South Africa imported R2.346 Billion (276 Million US dollars) making it a net importer

* South Africa imports by market: 2009

* The ratio of exports into imports is 1:2.4

The four most commonly exported product group:

* Dining Table

* Dining Chairs

* Living Room

* Bedroom Beds

Major factors affecting market growth:

* There are many reason for the poor performance of the furniture sector, including the following:

* Increased global competition and growth in imports especially from China (which is also linked to the level of volatility of the Rand whereby frequent fluctuations in the Rand’s value complicates the pricing of products for both export and domestic consumers and increase the potential risk of export activities).

* Inability and or unwillingness of local manufactures to produce new, innovative and cost effective designs which are informed by global trends.

* Growing interest in green and sustainable furniture such as eco-conscious furniture.

* Growing use of modular, flexible furniture designs which allow furniture components to be used in different combinations.

* Manufacturing competitiveness challenges which are linked to no or under investment in new machinery.

Trends review

* By 2010, the middles class has risen to 34% of Africa’s population or 350 Million people-up from 126 Million people or 27% in 1980, 27% in 1990 about 220 Million in 1980, 27 % in 2000. This represents growth rate of 3.1% in the middle class population over a period 1080 to 2010, compared with a growth rate of 26% in the continent overall population over the same period.

* About 60% of Africa’s middle class population approximately 180 Million people remain barely out of the poor category.

* In 2009, South African public higher education institutions employed 43 446 academic staff and 117 797 general staff in total.

* The public higher education institutions enrolled 837 779 students of which there were:

* 684 419 undergraduates students

* 128 postgraduate students

* Public higher education institutions awarded 144 852 qualifications at all levels, including:

* 33 788 qualifications in business and commerce

* 39 984 qualifications in science and technology

* 71 036 qualifications in the human and social science

* Public higher education institutions produced:

* 8 112 masters degrees

* 1 380 doctoral degrees

* Strong economic growth in the past two decades has helped reduce poverty in Africa and increase the size of the continent middle class.

* Until the global economic crisis heat South Africa in late 2008 economic growth has been steady and unprecedented. According to Statistics South Africa, GDP rose by 2.7% in 2001, 3.7% in 2002, 3.1% in 2003, 4.9.% in 2004, 5% in 2005, 5.4% in 2006, 5.1% in 2007 and 3.1% in 2008.

* From the first quarter of 1993 to the second quarter of 2008, the country enjoyed unprecedented 62 quarters of uninterrupted economic growth, but as the crisis made it felt, GDP contracted in the third and fourth quarters of 2008, officially plunging the economy into recession. This contraction continued into the second quarter of 2009, with GDP growth at 6.4% and-3% respectively.

* Consumer inflation came in at 5% from 2004 through 2006 before global prices pushed it up to 6.5% in 2007. In 1994 it stood at 9.8%.

* The South African economy is estimated to have grown by 3.1% in 2011, up from 2.9% in 2010, but growth is expected to slow to 2.8% in 2012 because of the continued weakness in the global economy and domestic structural constrains.

* The business regulatory environment remains extremely conducive, although lack of capacity in the public sector and deepening divisions within governing coalition over government’s policy direction present a downside risk in the medium term.

* In spite of a comprehensive approach to eradicate extreme poverty and hunger though social protection measures, poverty and inequality still remain high and country remains one of the most unequal societies in the world.

* The fiscal deficit rose from 4.2% in 2010 to 4.8% in 2011 and is expected to fall to 4.4% in 2012. The reserve bank’s repo rate remains flat at 5.5%, a thirty year low, through 2011. The average annual inflation rate remains at 5% for 2011. It is expected to rise to 6.2% before easing to 5.4% in 2013.

* Unemployment fell to 23.9% at the end of 2011, down from25% in the third quarter.

Microeconomic indicators

2010 2011 2012 2013

* Real GDP growth 2.9% 3.1% 2.8% 3.6%

* Real GDP per capita growth 2.1% 2.4% 2.2% 3.1%

* CPI inflation 4.3% 5% 6.2% 5.4%

* Budget balance % GDP -4.2% -4.8% -4.4% -4.2%

* Current account % GDP -2.8% -3.1% -3.9% -4.3%

* Exports 4.3% 3.9% 4.7%

* Imports 8.3% 8% 9.1%

* Prime rate 9% 9% 9.5% 10%

Indicators | 1994 | 2011 | % change |

| | | |

Population | 30 million | 51 million | +30.8% |

Real GDP per head | R28 536 | R37 442 | +31% |

University & university of technology enrolment | 528 135 | 837 779 | +58.6% |

Proportion of qualified teachers | 64% | 93.7% | 46.4% |

People on less than 2 US dollars a day | 12.1% | 5% | -58.7% |

Proportion on less than 2 US dollars a day | 4% | 26% | 550% |

African ownership, JSE retirement fund | 15% | 28^ | 86.7% |

| | | |

3.3 Competition and Competitive Edges.

The high end market understands the concept of service and support and it is more likely to pay for it when the offering is clearly stated.

There are many competitors in the local market and although each of them deliver quality products we feel that they fail in the delivery of eco-friendly and environmental friendly products.

There are 4 factors that govern the cost of furnisher manufacturing : Scope, Product, Design and Services, most people mistakenly think that the size of the project and choice of brand name products will make the best results, but it is the design and a company’s services that will have the greatest impact on the quality and value of the customers investment.

Competitors

* For Textile finishes, our competition is Teflon and Scotchgard

* Scotchgard is a 3M brand of products, a stain repellent and durable water repellent applied to fabric, furniture, and carpets to protect them from later stains.

* The original formula for Scotchgard was discovered in 1952.

* In 1999, the United States Environmental Protection Agency (EPA) began an investigation into the class of chemicals used in Scotchgard, after receiving information on the global distribution and toxicity of perfluorooctanesulfonate (PFOS) and its precursor perfluorooctanesulfonamide (PFOSA) the “key ingredient” of Scotchgard.

* In May 2009 PFOS was determined to be a persistent organic pollutant (POP) by the Stockholm Convention

* Teflon is the brand name for a substance called polytetrafluoroethylene, a type of plastic. It is considered to be the slipperiest substance in the world and has a wide range of applications as a coating material. Teflon is used as a coating for cookware, telecommunications cable, industrial pipes and fabrics.

* It contains Ammonium perfluorooctanoate, known as C-8, which has been linked to cancer, organ damage and other health effects in tests on laboratory animals. In two to five minutes on a conventional stove top, cookware coated with Teflon and other non-stick surfaces can exceed temperatures at which the coating breaks apart and emits toxic particles and gases linked to hundreds, perhaps thousands, of pet bird deaths and an unknown number of human illnesses each year, according to tests commissioned by Environmental Working Group (EWG).

* Our products contain Nano particles present in the environment namely Silicon and Titanium. These are naturally occurring elements in the earth’s crust. Silicon is sand and glass is made of sand! There are no free Silicon particles in the Nano products and the silicon remains inert because of the Sol-Gel process used in manufacturing.

* Titanium is what makes white beaches white. It has been used as a whitening agent for decades in paper, plastic, toothpaste and pharmaceutical tablets.

Our Competitive Edge

* In addition, the liquid glass coatings possess similar properties of glass with typical characteristics of durability, inert and highly resistant to acid and chemicals.

* In exception, the coating is 500 times thinner than human hair (approximately 100 nanometres) flexible, breathable and does not emit loose Nano particles.

5. MARKETING PLAN

5.1 Overall Marketing Strategy.

The Marketing Plan for Black and White Designers will feature a multi-pronged approach due to both the diversity of the Products being brought to market (Furniture and Nano Textiles) and also the diversity of the Markets to be targeted (Individuals, Designers, Retailers, Suppliers, Corporate Buyers, Government Buyers and Media).

The Budget for the Marketing Plan and Promotional Marketing Activities has been provisionally calculated for Year 1, although in practicality, there is every reason to believe that the Marketing Activities will stretch to 18 months and some individual Activities perhaps even into Year 2, depending upon availability issues such as Media space, Industry and Retail Fairs (such as Design Indaba).

Marketing and Promotional Marketing Activities are vital to create and maintain both awareness in the individual and collective Target Markets and to build and maintain Brand Awareness. This is never more important as when first bringing the Product(s) to the market in a comprehensive way, such as that being done by Black and White Designers. If this foundational step is done thoroughly, effectively and with purpose, future Marketing and Promotional Activities merely require a reminder campaign featuring existing offers, and an awareness campaign of new Product launches.

Marketing today requires of an organisation to interact directly and on a personal level with clients, whether individuals, intermediaries or buyers. Thus, it cannot be stressed just how important the creation and maintenance of a direct database and interested clients is, and Black and White Designers plans to do this through a personalised Newsletter, Public Relations Activities and the various Email Marketing opportunities (see Budget).

It will also be apparent from the Plan that no paid-for Advertising has been included – this is because it does not generate sufficient ROI at Start-up when the organisation’s name is largely unknown, and also because the majority of the various Target Market’s can be reached in more cost-effective ways, that are in fact more desirable to them.

Please note that this Budget does notinclude Personnel Costs, Travel Costs or any costs incurred as a result of the Implementation of these Promotional Marketing Activities. Personnel, Travel and other costs will be included in their own relevant Budgets.

A breakdown of the Provisional Budget has been included below:

Promotional Marketing Activity | Cost |

FURNITURETrade Fairs (Industry) x 2 p.a. Trade Fairs (Industry and Retail) x 2 p.a.Database Newsletter x 12 p.a.Groupon (Email Marketing) x 2 p.a.DealZone (Email Marketing) x 2 p.a. VuvuPlaza (Email Marketing) x 2 p.a.Public Relations Media Placements x 12 p.a.TOTAL Furniture | 40 000.0040 000.0024 000.008 000.008 000.008 000.0024 000.00152 000.00 |

5.2 Pricing.

Black and White designers will adopt a premium pricing strategy. Our products will be priced artificially high in order to emphasise our products are of exceptional quality because of Nano Technology, “Green Technology” manufacturing and production, and health and environmental impact and benefits.

Premium pricing defined:

A premium pricing strategy involves setting the price of a product higher than similar products. This strategy is sometimes also called skim pricing because it is an attempt to “skim the cream” off the top of the market. It is used to maximize profit in areas where customers are happy to pay more, where there are no substitutes for the product, this pricing strategy fit well with Black and White designers as we are the only manufacturer that apply the Nano technology treatment in our furnisher fabric and material making our products far superior than that of our competitors.

Features & Benefits of Premium Pricing Strategy:

Price-quality signaling

Black and White Designers will use Premium pricing to improve its brand identity in the market in which it operates, this is called price-quality signaling, because the high price signals to consumers that the product is high in quality which will help position our Nano technology furnisher and designs as aspirational.

Competition

Black and White designers will exploit the gap in the market where there are few competitors directly competing with the company in the Nano Technology space to pricing at a premium, we are fully aware that Premium pricing is often a short-term strategy as prices will be cut once competitors appear on the market.

Brand awareness

Our long term strategic outlook is to remain a niche market player and maintain our brand image based on luxury, this will help the company to continue to use its premium pricing strategy.

5.3 Sales Tactics.

Black and White Designers Marketing Plan will consist of a multi-pronged approach as a result of the combination of the diversity of product which needs to be presented in such a way as to be made desirable to the various target markets.

The product breakdown and demographics are as follows:

* FURNITURE

* Product Range:

* Lounge Furniture

* Dining-Room Furniture

* Kitchen Furniture

* Bedroom Furniture

* Office Furniture

* Unique Selling Proposition(s):

* Exclusive

* On-trend

* Modern

* “Green”

* Eco-friendly

* Health conscious

* Premium Priced

* Superior quality

* Custom made designs

* Not mass-produced

* Target Markets:

* Individuals

* Age: 30-40

* Sex: Mostly Female

* Income: R15 000.00 p.m. +

* Professional Class: Tertiary Education

* Geographic Area: Urban and Peri-Urban

* Interior designers

* Age: 30-50

* Sex: Mostly Female

* Income: R 30 000.00 p.m +

* Professional Class: Tertiary Education

* Geographic Area: Urban and Peri-Urban

* Décor and interior design retailers

* Age (Owner/Buyer): 40-50

* Sex: Mostly Female

* Income: Variable

* Professional Class: Tertiary Education

* Geographic Area: Urban and Peri-Urban

* Property developers

* Age: 45-60

* Sex: Mostly Male

* Income: R 50 000.00 p.m. +

* Professional Class: Tertiary Education

* Geographic Area: Peri-Urban and Suburban

* High-end retailers

* Age (Buyer): 35-45

* Sex: Mostly Female

* Income: R 25 000.00.p.m. +

* Professional Class: Secondary and Tertiary

* Geographic Area: Urban and Peri-Urban

* Media (Mass-produced and Industry Specific)

* Age: 25-40

* Sex: Mostly Female

* Income: R 15 000.00 p.m. +

* Professional Class: Tertiary Education

* Geographic Area: Urban and Peri-Urban

5.5 Advertising and Promotion.

* Promotional Activities And Cost Estimate per Promotional Activity:

* Trade Fairs (Industry) x 2 p.a.: R 40 000.00

* Trade Fairs (Industry and Retail) x 2 p.a.: R 40 000.00

* Database Newsletter x 12 p.a.: R 24 000.00

* Groupon (Email Marketing) x 2 p.a.: R 8 000.00

* DealZone (Email Marketing) x 2 p.a.: R 8 000.00

* VuvuPlaza (Email Marketing) x 2 p.a.: R 8 000.00

* Public Relations Media Placements x 12 p.aR 24 000.00

TOTAL: R 152 000.00

5.6 Distribution.

* Distribution Channels:

The flock of players in the distribution of furniture consists typically of export agents, import agents, importing companies, buyers’ groups that represent the interests of a larger number of collective importers, wholesalers, department stores and retail outlets of different kinds. The preferred flow of furniture is however from a manufacturer to importer or directly to retailer’s warehouse or chain stores because furniture is not well suited to multiple handling. Sometimes, it may be possible to sell directly to industries and institutions, and occasionally through a local manufacturer if the products complement each other. Some manufacturers sell direct to consumers through brand stores or factory outlets. Also, franchised stores by some major furniture manufacturers have become more common. These are specialized distributors, whose main business line is furniture.

* Internet

* Sales Staff

* Intermediaries

6. DESIGN AND DEVELOPMENT PLANS

6.1 Development Status and Tasks.

The research and development of Nano Textile (Magic fabric) has been completed. Nano Textile raw material and Nanotechnology coating and finishing agents secrete trade agreement has been signed by Black and White Designer and Nano Land South Africa, in a share acquisitioning agreement.

Regular order

| | | | |

Sample order

| | | | |

Manufacturing of Nano Textile agreement with exclusivity rights has been signed by Black and White designers and Cedar Brook a local fabric manufacture. The cost of manufacturing the fabric locally is R49-00 to R89-00 per metre. The minimum order quantity is 500m.

Nano-textile 1 | R83.00 | 100m | | | |

Nano-textile 2 | R73.00 | 100m | | | |

Nano-textile 3 | R98.00 | 100m | | | |

Nano-textile 4 | R93.00 | 100m | | | |

Nano-textile 5 | R83.00 | 100m | | | |

TOTAL | | 500m | | | |

6.2 Difficulties and Risks.

Capital

* The initial capital investment for the production on the Nano-Textile will be as follow:

* | * | * |

* Nano-Technology Products | R 86 700.00 | * |

* Nano-Textile Production | R 46 230.00 | * |

* | * | * |

Delivery Time

* Delivery of Nano Technology products is within 30 days from the date of receipt and confirmation of ordered quantities and payment.

Access to market

* Increased global competition and growth in imports, especially from China and introduction of Nano Technology in a market that is far behind in innovations, “green” technology, environmental health issues and health consciousness.

Strength of Rand

* Level of volatility of the Rand whereby frequent fluctuations in the Rand’s value complicates the pricing of products for both export and domestic consumers and increase the potential risk of export activities.

Availability of raw material

Locally produced yawn is extremely scarce, and manufactures of local fabric have closed down due to the decline in local production activities, currency volatility, increase in cost of production, cost of production, and scarcity of cotton farmers.

Affordability of raw material

Locally produced yawn or raw material has declined and local production is low, the demand is extremely high, this drove the cost of raw material to sky rocket.

Black and White Designers’ has the following expertise to make Nano-fabric development and saleable:

* Environmental health specialist, that conducts environmental assessment reports, environmental impact report, and implement strategies to contribute t “GREEN” planet.

* Medical doctor, which conducts research on the best Nano technology products, conduct research on impact on health and community.

Participants in the product development

* Black and White Designers

* Nano Land South Africa

* Cedarbrook

6.3 Product Improvement and New Products.

Nano fabric will not be used by Black and White Designers to design and manufacture custom made furniture, “green” and sustainable furniture, eco and friendly furniture and health conscious furniture.

New Product

Nano Tech-Bedding

Nano-Tech-Curtains

7. MANUFACTURING AND OPERATIONS PLAN

7.1 Operating Cycle.

Working Days

Week days | Month days | Year days |

5 | 20 | 240 |

Raw Material Holding:

Inventory holding levels in days | 10 |

Work in Progress | 10 |

Finished Goods | 2 |

Stock level | 20 |

Flexibility:

Black and White Designers lead time to customers: Domestic

Performance from finished goods in days | 2 |

Performance from production in days | 10 |

Production down Time:

Down time due to product change over | 0.1% | 2.16 | 0.18 | 0.045 |

Down time due to product machine break down | 1% | 21.6 | 1.8 | 0.45 |

Down time due to product scheduled maintenance | 0.3% | 10.5 | 0.875 | 0.218 |

| | | | |

Lead time of suppliers:

Domestic suppliers | 5 days |

International Suppliers | 30 days |

Age of our capital equipment is less than five (5) years.

Seasonal Production:

Seasonal production loads increase in autumn (February and March) because of the trade fairs like home makers expo Cape Town and Design Indaba Cape Town.

The winter season, sales are down and production load reduce because of the decrease in home improvements. In this season we will focus on new products development and production of new Range for the next season.

The spring season is a promotional season with trade fairs taking place in three (3) provinces consecutively i.e. (KZN, EC and WC).

There is a reduction production levels.

Summer season is the production month, this is a peak season in our production because of the market response from all the national trade fairs, we will have vocational training for furniture design students this will elevate production pressure in our manufacturing facilities with extra staffing.

7.2 Geographical Location.

Location:

Ilinge Township, Queenstown

* The location of Black and White Designers manufacturing facilities at Ilinge is because of municipality support and local councillors by availing a government owned building that was previously used for craft and manufacturing of textile and clothing rent free, the facilities are located in a 18000m2 piece of land, that has four (4) buildings for manufacturing with the approximate size of 5400 m2 each facility production space.

* The most affordable mode of transport is rail network, the rail station is located approximately 20Km from the manufacturing facilities.

* The factory will create employment and employment opportunities for the community members of the impoverished rural township and surround areas.

* Queenstown is a central town in the Eastern Cape, and Black and White Designers will be the first company to start “Green” manufacturing in the area.

Location:

Cape Town

* The manufacturing facilities that are located in Cape Town are in a close proximity to our suppliers, fabric manufacture and storage facilities.

* Our facilities are close to the harbour for import and export, they are also in the vicinity of railway station and logistics companies operate inside the Cape harbour, this is advantageous to Black and White Designers.

* All our facilities are located close to all the amenities that we need for our production and manufacturing, thus reducing carbon foot print and cutting carbon emission.

* We also use renewable and sustainable solar energy, for powering our facilities and recycling all our manufacturing material.

9.2 Impact on the Environment.

Black and White Designer manufacture a range of furniture design including kitchen, office, dinning and bedroom furniture. The organisation utilizes a collection of various natural materials into furniture pieces and to ultimate product. These materials include wood, wood-based material such as chipboard and ply wood as well as materials such as metal, foam and leather. The organisation strive for continued environmental performance by integrating environmental, ecological, socio-economic and business concerns into day-to-day operations through some collection of sustainable options.

* Choice of raw materials- utilizes natural renewable raw materials to produce goods and services that are environmentally friendly. The source of wood is obtained from suppliers that are members of sustainable forest management in South Africa. In particular, the Forest Stewardship Council (FSC), an international non-profit that encourages sustainable forestry thus the materials carry logos and guarantee that they come from responsibly managed forests. The selection of materials is based on environment principles and incorporate social concerns. Other material used is sought form certified independent bodies and possess some unique characteristics of durability, quality and recyclability.

Impact on the Environment

* Design for environment- the products are designed for environment. They are designed to reduce the quantity of natural materials used prior to the production and designed in such a manner that they can be disassembled at the end of its useful life. The design focused on careful material selection and design techniques which incorporates energy, processes and product. They are designed according to ecological principles, energy and resource efficiency. Furthermore, the flow of materials in the system is circular. In this regard, the materials extracted from the initial stage of manufacturing are produced into goods that at the end of life or use of the product they re-enter the system forming a closed-loop therefore there is little or less disposal of waste. However, the waste generated during the production stage is collected into waste streams for recycling, reuse and recover of materials. Therefore, nothing enters the environment.

* Wood Recycling

waste in wood processing and furniture making contributes to the problem of unsustainable timber use. Wood waste generated during sawing and cutting of wood includes sawdust and end pieces of various materials, including wood, particleboard, and various types of fibreboard. Improvements in all of these areas can enhance the cost-effectiveness of these operations while reducing environmental problems.

9.3 Impact on the Community and Nation.

* Clean technology-utilizes innovative technology “nanotechnology “which acts as substitute for chemicals and synthetics to treat products reducing the contamination of the environment. Nanotechnology is the environmentally friendly technology produced by manipulating natural occurring substance “silicon” to produce natural products. The use of nanotechnology has been employed as a preventive strategy which prevents the impacts from the sources rather than reducing the existing impacts to improve efficiency and reduce the harm to human beings and the environment meanwhile enhancing cleaner production. The clean production thus save energy and resources, reduce the products whole life cycle, from raw materials to the end life of the product.

Implementation Strategies

* Eco-efficiency-utilizes efficient natural materials to produce goods that are environmentally friendly, which reduce the need and reliance on the natural resources because the materials used are renewable and recyclable.

* Life Cycle Analysis- The organization adopted LCA as a tool to evaluate environmental impacts associated with all the stages of production of goods ranging from extraction, transportation, processing, production, distribution, packing and consumption. The total resources used to produce goods including the waste dissipated to the environment. LCA is employed to quantify the resulting impacts of production. The organisation has developed an input-out-put model as a tool to trace all the inflows and outflows during the production and analysed the outcomes for informative decision-making and has implemented product stewardship, whereby it takes responsibility of the product after the end use by treating the product with nanotechnology products. For instance, extending the technical life span i.e. the time during which a product functions well) and extending the aesthetic life span i.e. the time during which a user finds the product attractive. For example, ensuring that a product will be cleaned, maintained and repaired on time will increase its usability and life span.

10. OVERALL SCHEDULE

* Good value for price, timely deliveries and proper after-sales service are needed for keeping competitive at the special niches like antique/traditional ethnic furniture markets.

New furniture collections will have to be created at shorter intervals in order to keep pace with market opportunities.

Creating original designs and attractive branding are necessary for moving to higher price points. Design should provide real added value to the product. Brand should be the flag to catch the attention of buyers.

Avoid using wood raw material that comes from illegal or unsustainable sources, as products thereof are subject to trade barriers and retailer resistance.

11. THE FINANCIAL PLAN

See attached Appendixes:

1. Income Statements and Balance Sheets

2. Pro Forma Income Statements

3. Pro Forma Balance Sheets

4. Pro Forma Cash Flow Analysis.

1.1.1 The opportunities and Strategy

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