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Auto Parts and Service Company Business Plan

1863 words (7 pages) Essay in Marketing

5/12/16 Marketing Reference this

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ABC will be participating in a growing market. After China join in the WTO, the price of cars keep going down. Since 2005, the price of cars has declined 10%-50% in China. It has become one of the largest-growing markets in China. A recent survey indicates that over 20% factories and customers have suffered the problems that the lack of auto repair services. If we consider the whole auto market as a giant whose left leg is new cars or used cars market and right leg is auto-parts and auto repair services market. The left leg of the giant has stepped in China. However his right leg is still out of the country. Because the auto market is increasing in such high speed, it will help the auto-parts supplies and auto repair services market grow.

The Organization

Gaining the unsatisfied customers is the first mission of the organization. With this in mind, ABC will be working hard and produce the impressive services that are exceeded in customer’s expectations. To gain and maintain those customers, to build up close and stable relationships to customers, and to expand the market, ABC is going to offer supplies to auto factories, including body shops, to offer auto repair services to individual customers through participation and .inviting 3-5 local auto supply business partners to fund a corporation by offering advanced technology from the U.S.

1.1 Mission

Firstly, ABC will offer high-quality auto repair services with all kinds of auto parts. ABC will proffer its convenient and rapid service. Secondly, ABC will set up a computer system to make sure that parts are available. Lastly, ABC will build strong relationships with the local towing companies and body shops.

Keys to Success

Relitionships with local towing service companies, body shops and workshops.

A wide range of auto parts inventory.

Proffering website which answer customers’ questions whenever they have a problem with their cars and make them be able to order auto parts on line.

Rapid delivery of major auto parts.

Uperior customer service, and systematic operation

More advanced technology and more technical employees

The idea of fixing customers’ cars in their own gagrages is one of our main operational cencept.

2.0 Company Summary

The Chinese economic have been growing and it had resulted in the Chinese people’s increased income, since 2000. Nowadays, many Chinese have chosen to spend their money on their automobiles in order to declare they have become the members of middle class. As a result, the need for reliable and convenient auto services will increase with the help from the booming economy and the strong ideas of having own cars. ABC is going to enter Chinese market to fill up the need of the middle and upper class market for quality auto service in Qingdao.

2.1 Company History

ABC was found by several local 4S shops in Seattle 2008. Besides the ABC has combined the successful experience of marketing, sales, management and operation, ABC also has developed its technical advantage. In 2008, due to ABC had seen the blight future of the application of composite materials in auto repair market and the corporation in the technical communication between Boeing Company and the local community colleges and universities, the company hired 30 employees from University of Washington and North Seattle Community College to put this technology in use for auto repair in order to improve the company’s competitive advantage. These made ABC successful and generate the net profits which have exceeded $50000 in Seattle area in this year. However, ABC realized the advanced position in the competition will not last for long. Also, considering extending its size and influence and exploring a more valuable market, ABC is going to enter Chinese market.

Past Performance

2010

Sales

$600000

Gross Margin

$500000

Operating Expenses

$50000

Balance Sheet

2010

Current Assets

Cash

$200000

Inventory

$100000

Other Current Assets

$50000

Total Current Assets

$350000

Long-term Assets

Long-term Assets

$290000

Accumulated Depreciation

$10000

Total Long-term Assets

$300000

Total Assets

$650000

Current Liabilities

Accounts Payable

$50000

Total Current Liabilities

$50000

Long-term Liabilities

$1300000

Total Liabilities

$1350000

Paid-in Capital

$500000

Retained Earnings

$50000

Total Capital

$550000

 

3.0 Services

3.1 Auto services

ABC will offer superior customer services with systematic operation.

3.2 Online services

ABC has a free website where our employees will answer the questions and try to help our customers online. If the customers think they can fix the problems of their cars in their own garage with the help of our employees or somebody else, these customers will be welcome to order our parts through our website. Also, ABC allows their customers make appointment online. Lastly, our customers will be able to check out the record of their automobiles online.

3.3 Door to door services, fix your cars in your own garages!

ABC will have a door to door services for some VIP customers to slove some problems which are not necessary to come to our shops, such as oil change.

4.0 Market Analysis Summary

ABC highly focuses on the demand of local customers. At the same time, ABC also is going to establish relationships with the major local towing companies, and body shops.

4.1 Market Segmentation and Stategy

Towing companies

After traffic accidents, the towing companies usually are called to take their damaged cars away. However, the companies in China don’t usually give the repair service. In this way ABC can make approximate 20% revenue, if we can successfully build up the relationships with the major towing companies.

The Body shops

The young people like to go to body shops to race their cars for vary reasons. They are more likely focus on the look of their cars and usually require very quick services as well. After we establish and strengthen the relationships with the body shops, we can reach that target market segment so that we can offer the body shops the rapid delivery services and make it available to ship the designed auto parts for each individual since we have an online booking service.

Local regular customers

The local regular customer base is the largest market of ABC. Based on the fact that not too many repair issues happens daily among the local customers and some owners of new cars prefer to take their cars to the dealers if there are really serious problems with their cars, ABC will also focus on the other services of automobile, such car wash, oil change, and so on.

4.2 Competition and Buying Patterns

The exsiting market in China already have had 10 major auto repair and auto parts companies in the local area, so ABC will have 10 major competitiors. Nevertheless, ABC get the advantages that they don’t have or not as competitive as ours. Firstly, these companies usually are not large enough, or do not have uperior customer service and systematic operation. Secondly, none of these competitors a computerlized systerm and online service. Thirdly, none of these competitiors have the technical superiority as ours. ABC’s key to win the game is gaining and remaining customers by using the technical advantage, focusing on the convenienct high level customer service, and establishing and strengtening the relationships with lacal major body shops and towing companies.

5.0 Strategy and Implementation Summary

ABC will be successful by offering its systematic operation by adapt the technology from the U.S.

5.1 Sales Strategy

ABC will focus upper and middle class customers. To reach the target market and promote the customers, the company will employ direct sales staff. At the same time, the company will further strengthen its relationships with the towing companies, and body shops.

5.2 Promotion&Marketing Strategy

Direct sale employees, online helping, door to door services, coupons will be our promotion. On the ABC’s free website, our employees will answer questions and try to help our customers online. On “asking question” section, we will put the quick link to the booking page. These researchers will be more likely to order our parts through our website so that they can make it in their own garage. ABC also can send our employees to help them. “Fix your car in your own garage!” will be one of our marketing strategies. Additionally, ABC will give coupons to customers for 10% off.

5.3 Sales Forecast

Sales Forecast

2011

2012

2013

Sales

$50000

$150000

$250000

Direct Costs

$10000

$10000

$10000

6.0 Management Summary

ABC will be successful by combining the 3-5 local auto supply business partners experience of sales, marketing, orperation and management. In order to keep organization stable and keep all of the partners, the ABC will keep the core of the technology.

6.1 Personnel Plan

Thank to the low average salaries in China, ABC will be able to hire more employees in the technology department in the U.S.

Personnel Plan (Not in including investment from partners)

Year 1

Year 2

Year 3

Owners

$10000

$50000

$90000

Managers

$5000

$15000

$25000

Mechanics

$4000

$12000

$20000

Technology improment

$20000

$60000

$100000

Sales & Administrative

$1000

$3000

$5000

Total People

25

75

125

7.0 Financial Plan

ABC will be a corporation. The funding is from 3-5 local auto supply business partners by offering advanced technology from the U.S. Each partner will invest an equal amount.

7.1 Partners investment Summary

ABC is looking for four local partners which meet the requrements to corporate.Each of the four partners which means to join ABC have to invest an equal amount.

Table: Investment from partners (Requriements)

Requirements

Start-up Expenses

Legal

$1000

Other

$5000

Total Start-up Expenses

$6000

 

Start-up Assets

 

Cash Assets

$3000

Other Current Assets

$15000

Long-term Assets

$100000

Total Assets

$130000

 

Total Requirements

$130000

(ABC will be more likely to accept partners which are able to meet those requirements.)

 

7.3 Break-even Analysis

Break-even Analysis

Monthly Revenue Break-even

$25000

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