Business Plan : LayZee Bean Bags

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This Presentation is business plan for Bean Bag chair.Bean bag chairs are all the rage today among modern furniture for your home or even for offices. These otherwise slouchy, shapeless bean filled sacs are gaining popularity as people are finding many ingenious uses for such a item.

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Business Plan : LayZee Bean Bags

  1. 1. LayZee Bean Bags Setting Up a Business? Renzil D’cruz http://RenzilDe.com http://about.me/renzilde http://linkedin.com/in/renzilde 1
  2. 2. Index Introduction information about Bean Bags 3 General Company Description: LazzyBean Bags 5 Products and Services 6 Productions and Manufacturing Process 14 Operations Plan 18 Utilizing Human Resource 22 Marketing strategies and Sales Plan 26 Financial Plan 33 SWOT Analysis 36 Conclusion 37 2
  3. 3. Introduction A bean bag is a sealed bag containing dried beans, PVC pellets or expanded polystyrene, with various applications. Bean bag chairs are all the rage today amongst modern furniture for your home or even for offices. These otherwise slouchy, shapeless bean filled sacs are gaining popularity as people are finding many ingenious uses for such a item. Today, bean bags come in a variety of textures, colors, shapes and sizes so that one can choose to use them as they please. Besides leather, there are a host of other materials which these bags are being made of, such as synthetic or vinyl materials. Hence, bean bag chairs are now more affordable and people are willing to experiment 3
  4. 4. with them in hotels, lounges and even offices, besides their homes. Bean bags have always been a great favorite amongst children due to their softness and lack of shape. From bean bags being used in various games where they are tossed around, nowadays children love to do the same with their bean bag chairs. On these they can comfortably sit and play games, lie back and watch television and these can be moved from room to room which is another great benefit of bean bags. Bean bags nowadays come with Styrofoam beans fillings which become flattened due to regular use. Hence, the inner filling of bean bag chairs need to be changed periodically. Such filings are easily available with bean bag manufacturers and one can even try their own filings at home such as with sponge, thermocol balls or cotton. One can even obtain new covers for their bean bags and have a brand new design or color to flaunt and make them good as new. Thus, bean bags have gained much popularity of late due to the ease and flexibility of their shape and design. 4
  5. 5. About Lazzy Bean Mission : To provide the Comfort to ordinary folk and chance to buy the same thing as rich people. A LayZeeBeanBags dedicated to showing products designed, developed, manufactured and marketed at LayZeeBags.com. We are a dedicated West Region manufacturer, based in Bandra, the heart of the Mumbai. LayZee Bean have been manufacturing and supplying Bean Bags since 10th October 2012. Our focus on designing and producing quality precision textiles is second to none and has become the trade mark in the industry. We have an extremely imaginative design and production team that can provide a complete consultation, design and production service.Latest technology in design and production ensuring an efficient operation, we also have branding facilities such as embroidery with full embroidery disc design and generation on site at our factory in Bandra. So if you're looking for a high quality, hand made, well designed and fun bean bag then look no further than LayZeeBags.com 5
  6. 6. Production 6
  7. 7. Bean bags have come a long way since then. These are nowadays manufactured in an array of fabrics, from cotton twill to suede, vinyl, making leather only one of the choices amongst which one has to pick up bean bags. Each fabric gives a different feel to the bean bag furniture and also come in different types of prints, colours and designs to give people choice when they are buying bean bag furniture in accordance with the interiors of one’s room or office, lounge, hotel lobbies, campuses and so forth. Every city in India has its own set of bean bag & corporate gifts manufacturers and suppliers and those who stay in Mumbai are spoilt for choice when it comes to bean bags. From the high end lifestyle stores to even departmental or online outlets, there are bean bag furniture of every type and design to suit the need and budget of customers.  Cloth used Bean bags are now available as bean bag chairs, sofas and even beds. Initial day’s bean bags used to be expensive since they were only made of leather but today, there are many other fabrics of which bean bags are made of and that helps to give them character, diverse looks, feel and suppleness. From vinyl to nylon, cotton twill, denim, suede, velvet – there are a wide variety of bean bags which are available and are not too expensive a purchase as compared to conventional furniture.  Cost 7
  8. 8. The price of bean bags varies as per the material used or the size. When you look at the usual bean bags for sitting which are the sizes of small chairs or stools, these come in the range of Rs. 800 to Rs. 1500. Some furniture stores give discounts during lean buying periods and one can get a discounted one for Rs. 500 – 600 as well. Large or extra large bean bag chairs are usually priced upwards from Rs. 1500 while those of high quality leather can set you back by Rs. 5000. If you are looking for bean bag sofas where two people can comfortably sit side by side, these are usually priced upwards from Rs. 4000. Similarly, the bean bag beds cost the maximum since they are larger in size, often being able to accommodate two adults in height and width. Such large queen size bean bag beds would come in the price range of Rs. 10000 and more, depending upon the brand, the type of material used, the filling and so forth. 8
  9. 9. Type Price (In ₹) 9
  10. 10. Small chair 800-1500 Extra large chair 1500 & above High quality leather 5000 & above Comfortable sofa 4000 & above Bean bag beds 10000 approx  BEAN BAG FILLING Bean bags are being used in almost every home in the world, leave aside lounges, bars, offices and so forth. These are the most versatile form of furniture which can be used in a variety of uses – as stools, chairs, sofas, beds and even as balls in various games. Bean bag furniture was initially discovered in the late sixties by Italian furniture designers who called the tear shaped sac chair as Sacco. These initially did not gain much favour amongst the masses since they lacked shape and character and were made of high quality leather, making them expensive accessories to have at home. Luxurious homes and lounges of hotels and other plush areas sported leather bean bags in the staid colours of black, brown or red. Initially bean bags were filled with Styrofoam beads or pellets and even sponge, fur were used as stuffing. 10
  11. 11. Today bean bag fillings are mostly comprised of polystyrene pellets or PVC pellets. These are usually in the form of irregular shaped beads which have negligible weight and these help to provide the light yet supple characteristic of bean bags. The popularity of beanbag furniture is mainly due to the light weightedness as well as the way the bean bags can mould themselves around a person’s shape, giving the person a feeling of weightlessness and cosy comfort at the same time. Such light yet supple support is possible due to the filling material inside the bean bags. Bean bag furniture over time may lose the supple, bouncy character and that is due to the fact that the PVC pellets, with continued pressure, become crushed and compressed, causing the bean bags to lose their volume. This usually leads to reduced feeling of comfort and support when one sits on these furniture. This is the time when the polystyrene beads need to be refilled. Packets of refill material are usually available with bean bag suppliers and many sell them with the bean bag furniture as well. Such refilling can be done at home since bean bags nowadays come with zipped linings which can be opened and refilled with pellets and safely zipped back again. Thus, bean bag refilling is essential to keep the form and shape of such furniture. The removable outer covers of bean bags can be opened and refilled which is easy to 11
  12. 12. implement. Thus making such furniture and their use and care has become easy and effortless. Bean bags do not contain beans. Their characteristic soft stuffing consists of two materials, which are plastic pellets and polyester fiber fill. The plastic pellets are made of either polyvinyl chloride (PVC) or polyethylene (PE), and they are produced by specialty suppliers. The polyester fiber is the filling commonly used for decorative pillows, comforters, some furniture, and many other products. The bean bag outer fabric skin is made of synthetic plush. We shall use unique fabrics to distinguish our product, for example, Rexine, Satin, SWIBCO and Leather. We shall use computer generated patterns and their corresponding cutting dies to maximize efficiency and minimize the amount of waste fabric. 12
  13. 13. A high-pile fabric shall be used for a fluffy, furry appearance and to add shimmer and gloss, a unique fabric known as Tylon shall be used. Incase of fancy bean bags, like that of animals, child-proof parts will be used. Industrial standard and quality fabric shall be used to ensure maximum safety of children. Secure stitching shall be ensured so that parts dont come off easily. The bean bags other prominent attachments are the tags. Hang tags are printed on paper and bear our identification and information. The hang tag is attached to the bean bag with a plastic strip fastener. These shall be made either of red or clear plastic, and each one shall be 1.3-1.9 cm long. Also a safety tag which will tell the contents of the critter and its place of manufacture (usually China, Korea, Malaysia, or Indonesia), as well as its name, company, and registration and trademark data. Because of counterfeiting, holograms that are more difficult to copy have been added to tush tags. Sacks: 3.5 ft: One child or one small teenager 5 ft: One adult or two children 6 ft: OUR MOST POPULAR PRODUCT - One adult , two adults sitting closely, one adult and two small children 7 ft: Two adults or three small children 13
  14. 14. 8 ft: Four adults or whole family…this product is MASSIVE! Huge Pillow One adult or two small children Comfy Pad Two adults or two children ** Pets also love the Comfy Sacks so don't leave them out! Loungers: 5 ft: One child lying down, two children or one adult 6 ft: STAFF FAVORITE - One adult lying down, two adults sitting comfortably side by side, two adults and a child, three children 7.5ft: two adults lying down, three adults sitting side by side, four children sitting side by side. Design: The process of designing a bean bag begins with a prototype and may take several years to finalize. Our plan includes designing the bean bags by making several prototypes of the same design. Shapes, colors, materials, features, and accessories are varied on the prototypes. 14
  15. 15. Then we shall ask friends and employees to poll to help select the best design. Some designs shall be reissued with color changes and other variations to improve our product The art department shall produce various designs, and the sketches shall be reviewed by the firm's owners, employees and even colleagues. The art work is then sent to the factory where handmade prototypes shall be constructed from different fabrics and color combinations. These may be approved for production or new art boards may be requested, and the process repeats. Of the one’s selected, they shall be ordered or put to production. The other which are not selected may be revised and kept for future Manufacturing Process: The patterns made for the selected prototype shall be computer-generated to fit a given length and width of fabric and are laid out for optimal use of the fabric. Cutting dies are also computer-generated from the pattern data. The various parts and components of the bean bag are then assembled and then thread and yarn features are stitched into seams. Size Sack Dimensions* Weight 3.5 ft Sack 3.5ft x 3.5ft x 2.5ft 7Kg 15
  16. 16. 5 ft Sack 5ft x 5ft x 2.5ft 10Kg 6 ft Sack 6ft x 6ft x 3ft 12Kg 7 ft Sack 7ft x 7ft x 3ft 15Kg 8 ft Sack 8ft x 8ft x 3ft 18Kg 5 ft Lounger 5ft x 3ft x 3ft 7.5Kg 6 ft Lounger 6ft x 3.5ft x 3.5ft 10Kg 7.5 ft Lounger 7.5ft x 3.5ft x 3.5ft 15Kg 3 in 1 Sack - (Comfy Pad) 6ft x 6 ft x 1ft 12Kg Pillow Sack 4.5ft x 5.5ft x 1ft 9Kg Assembly line manufacturing process shall be followed with different departments manufacturing different components. Then all the parts shall be bought together at a station and industrial sewing machines shall be used to securely sew them. Depending on the manufacturer, fiber fill may be added before they are stitched. Stuffing is added to the body after careful measuring of both the bean-like pellets and the polyester fiber. Measurements ensure a uniform weight. 16
  17. 17. Final details like are stitched in place, and the hang tags are clipped on with plastic fasteners. The bean bags are then sent to the packaging department where they are bagged and boxed to a carton for shipment. Quality Control : Seamstresses and assemblers shall be responsible for the quality of their work. A final quality control review shall be done prior to packing at the factory, and when the boxed bean bags reach their distribution centers in the country. They shall be inspected again when they are repackaged for shipment to retail stores. By-Product/Waste : Makers of bean bag shall produce lines with similar design characteristics but no true by-products. Bean bags are much in demand nowadays, especially in sprawling metropolitan cities like Mumbai. Every modern household and even tiny apartment find bean bag furniture 17
  18. 18. versatile and useful, adding a hint of contemporary modern feel to any living arrangement. Bean bags, which were discovered by Italian furniture designers in the late sixties, were designed as tear shaped sac chairs which were made of high quality leather. Since these chairs did not have any strong support, it depended on the fabric or material for durability and strength to be able to provide support to those who sat on these. Thus, leather made the perfect material for such bags but that also made such items expensive for the common man. Operation Our manufacturing processes include all activities from the point when raw material(textiles and beans) are received at the factory, to when retail-ready bags are shipped to the distributor. Some processes—such as fabric relaxing, 18
  19. 19. cutting, and sewing—occur in the manufacturing of all requirements. Other optional processes may also be performed as specified by the customer, That is customization of existing product. Depending on the size of the manufacturing facility, some manufacturers choose to subcontract those optional processes.  Fabric Relaxing Fabric bolts are unrolled to allow material to relax and contract. Fabric relaxing minimizes shrinkage during washing. 19
  20. 20.  Spreading, Form Layout, and Cutting The fabric is cut into uniform plies and spread onto the cutting surface. Forms are then laid out on the top of the spread, and the fabric is cut to the pattern shapes. Cutting is performed manually or using a computerized system.  Embroidery and Screen Printing and designing Optional customer-requested services may be performed to put logos or other embellishments on bags.  Sewing Bags are sewn in an assembly-line manner, with the garment becoming more complete as it progresses down the sewing line.  Spot Cleaning and Laundry This step is labor-intensive. Cosmetic flaws, stains, or other spots identified on an assembled Product may be cleaned using steam, hot water, or chemical stain removers.Customers may require a Bags to be fully laundered after it is sewn and assembled.  Testing Each garment is manually tested and then folded prior to packaging.  Packaging and Shipping 20
  21. 21. Garments are tagged, sized, and packaged according to customer specifications and then shipped to client distribution centres. 1. Purchase sufficient materials and equipment. Also purchase basic packaging supplies, especially if you will ship your furniture outside of the local area. 2.Create designs and set production time frames. If you are working on custom, concentrate on maintaining efficient capacity levels, such as 10,000 small pieces and 7,000 large pieces daily with minimal defects. 3.Estimate basic expenses. You must consider prices related to raw materials (Leather and thermacol balls) 21
  22. 22. 4.Advertise using multiple avenues like placing your contact information on the furniture delivery vans 5.Review operations and logistics decisions regularly.. 6. Buy a truck or lease trucks from a truck leasing company. we plan to buy truck saving costs in the beginning. Also motorcycle or bicycle for delivery man. 7.Market your furniture delivery business by passing out brochures and calling different companies. Print out business cards and give them to interested clients. Human Resource HUMAN RESOURCE MANAGEMENT 22
  23. 23. 1. OVERVIEW The main activity of this HR was to review the current state and practices in place When asked about the main challenges facing them in production, issues such as late delivery of materials, high absenteeism, lack of commitment of workers, a shortage of high quality stitches (furniture issue), along with labour productivity, were the most cited by managers. advanced HR techniques are findings from the survey. 2. RECRUITMENT A formal recruitment procedure is the first step towards a more strategic and value-adding HRM system. In order to have the best impact on performance many of the advanced HR techniques require the selection of certain types of workers: those that have the personality traits to be motivated by and perform well in teams, or those that are slightly more educated and will respond better and more quickly to training. 3. TRAINING Training is the key component of a more advanced HRM approach. Investment in training was lower than anticipated at the surveyed firms. One of the reasons for this may be the ready supply of skilled labor in particular regions, skills having been passed down through generations in cottage industries and then transferred to 23
  24. 24. the factory. Factory managers may also simply perceive only limited benefits 4. RETENTION AND MOTIVATION Many of the factories in the survey supplement their workers’ basic wage with a performance bonus. Rewards for reaching targets generally ranged from 10-35% of a worker’s total take home pay. At some of the more sophisticated factories with better performance monitoring systems the incentive scheme appeared to be doing its job, but many others were struggling. Some did not pay the bonus often enough or with such a time lag between performance and benefit that it ceased to serve its purpose. 5. HR Focus Points • Employee must be a focused profile that presents you as an ideal choice for the position. The profile must highlight your strengths in the perticular field, for example being a creative thinker, having proven management or leadership skills and being an excellent communicator. Past Experience • Employee should have good past experience include a list of your major roles and responsibilities with previous employers. Examples of your previous work should include addressing customers' needs custom requirements, examining the production of the garments, providing price 24
  25. 25. quotes for new customers, overseeing operations and providing employee feedback during the production, ensuring the quality is up to par before shipping, handling all external communication with customers. Education • Employers will browse through your educational background and have been professionally trained . Additional Skills • This requires knowledge of computers and technological gadgets so the manager can reply quickly and effectively. Outline any computer skills or communication skills you may have that can benefit your work as a garment export production manager. Include any language skills you have that allow you to communicate more effectively with customers. Salaries Roughly (Per Month) 25
  26. 26. Marketing/Sales/Finance Executive : Rs.10,000 to Rs.15,000 Labour(Cutting/ sewing/Other) : Rs.3,500 to Rs.10,000 Delivery and cleaner : Rs.5,000 to Rs.10,000 Marketing : 26
  27. 27. Pricing Your Product How you price your product is important because it will have a direct effect on the success of your business. Though pricing strategy and computations can be complex, the basic rules of pricing are straightforward: 1. All prices must cover costs. 2. The best and most effective way of lowering your sales prices is to lower costs. 3. Your prices must reflect the dynamics of cost, demand, changes in the market, and response to your competition. 4. Prices must be established to assure sales. Do not price against a competitive operation alone. Rather, price to sell. 5. Product utility, longevity, maintenance, and end use must be judged continually, and target prices adjusted accordingly. 6. Prices must be set to preserve order in the marketplace. There are many methods of establishing prices available to you: Cost-plus pricing -- Used mainly by manufacturers, costplus pricing assures that all costs, both fixed and variable, are covered and the desired profit percentage is attained. 27
  28. 28. Demand pricing -- Used by companies that sell their product through a variety of sources at differing prices based on demand. **Competitive pricing -- Used by companies that are entering a market where there is already an established price and it is difficult to differentiate one product from another. Mark-up pricing -- Used mainly by retailers, markup pricing is calculated by adding your desired profit to the cost of the product. Each method listed above has its strengths and weaknesses. Distribution Distribution includes the entire process of moving the product from the factory to the end user. The type of distribution network you choose will depend upon the industry and the size of the market. A good way to make your decision is to analyze your competitors to determine the channels they are using, then decide whether to use the same type of channel or an alternative that may provide you with a strategic advantage. Some of the more common distribution channels include: **Direct Sales -- The most effective distribution channel is to sell directly to the end-user. Manufacturer's Representatives -- One of the best ways to distribute a product, manufacturer's reps, as they are 28
  29. 29. known, are salespeople who operate out of agencies that handle an assortment of complementary products and divide their selling time among them. Wholesale Distributors -- Using this channel, a manufacturer sells to a wholesaler, who in turn sells it to a retailer or other agent for further distribution through the channel until it reaches the end user. Brokers -- Third-party distributors who often buy directly from the distributor or wholesaler and sell to retailers or end users. Retail Distributors -- Distributing a product through this channel is important if the end user of your product is the general consuming public. Promotion Plan With a distribution strategy formed, you must develop a promotion plan. The promotion strategy in its most basic form is the controlled distribution of communication designed to sell your product or service. In order to accomplish this, the promotion strategy encompasses every marketing tool utilized in the communication effort. This includes: Advertising -- Includes the advertising budget, creative message(s), and at least the first quarter's media schedule. 29
  30. 30. Packaging -- Provides a description of the packaging strategy. If available, mockups of any labels, trademarks or service marks should be included. Public relations -- A complete account of the publicity strategy including a list of media that will be approached as well as a schedule of planned events. Sales promotions -- Establishes the strategies used to support the sales message. This includes a description of collateral marketing material as well as a schedule of planned promotional activities such as special sales, coupons, contests, and premium awards. Personal sales -- An outline of the sales strategy including pricing procedures, returns and adjustment rules, sales presentation methods, lead generation, customer service policies, salesperson compensation, and salesperson market responsibilities. Sales Potential-- Once the market has been researched and analyzed, conclusions need to be developed that will supply a quantitative outlook concerning the potential of the business. The first financial projection within the business plan must be formed utilizing the information drawn from defining the market, positioning the product, pricing, distribution, and strategies for sales. The sales or revenue model charts the potential for the product, as well as the business, over a set period of time. Most business plans will project revenue for up to three years, although 30
  31. 31. five-year projections are becoming increasingly popular among lenders. When developing the revenue model for the business plan, the equation used to project sales is fairly simple. It consists of the total number of customers and the average revenue from each customer. In the equation, T represents the total number of people, A represents the average revenue per customer, and S represents the sales projection. The equation for projecting sales is: TA=S Using this equation, the annual sales for each year projected within the business plan can be developed. Of course, there are other factors that you'll need to evaluate from the revenue model. Since the revenue model is a table illustrating the source for all income, every segment of the target market that is treated differently must be accounted for. In order to determine any differences, the various strategies utilized in order to sell the product have to be considered. As we've already mentioned, those strategies include distribution, pricing, and promotion. Buzz Marketing At Trade Shows Marketing Strategy For Small Business: Best tip, resist the urge to look/sound like your bigger competitors. To create buzz at a trade show for a client and demonstrate how other competitors waste customers' time, we strapped a 31
  32. 32. big clock to a gurney and walked it around the show floor with two EMT types. T-shirts with the URL and booth number were the only "branding." Buzz = conversation, conversation = participation. Maintain Relationships With Clients Marketing Strategy For Small Business: The difference between a successful company and a mediocre one often boils down to an owner’s commitment to building (and sustaining) relationships with clients and prospects. While it’s important to keep up traditional communication and PR, business owners should also be extending their relationships through online forums - website, blogs, and social networks. 32
  33. 33. Web site 33
  34. 34. Finance: Money makes your business go. But don't try going to a bank to get it when you've just started in business. Banks normally make loans only to businesses with operating histories. This section will give you some alternatives, some strategies and some things to think about as you go about finding the money to make your business work. A banker's primary concern is your timely repayment of loans. The fuel to make loan payments come from your cash flow. So your management of cash flow is of utmost interest to your banker and you must convince the banker that you are an expert in making cash flow projections that safely include your loan payments. Here is more information on cash flow which is taken from session one of our Building My Own Business course. The cash flow control form will spell out all of your sources of income and expenses. For example, some expense items might include: • Buying supplies and inventory while waiting to get paid • Paying payroll and rent • Buying equipment and fixtures • Getting a machinery • Buying the business 34
  35. 35. Product Cost: Type Price (In ₹) Small chair 800-1500 Extra large chair 1500 & above High quality leather 5000 & above Comfortable sofa 4000 & above Production Cost: (Bean bag beds qt.10000 approx) Schedule of Cost of Goods Manufactured Direct Materials: Beginning raw materials inventory Rs.2 lakh Add: Purchases of raw materials Raw materials available for use Less: Ending raw materials inventory Raw materials used in production Direct Labour Rs. 1 lakh Manufacturing overhead: Indirect labour Rs.50000/35
  36. 36. Machine rental Rs.1 lakh Utilities factory Rs.75000/- Supplies Depreciation, factory Property taxes, factory Rs.10000/- Total overhead costs Rs.1,50,000/- Total manufacturing cost Add: Beginning work in process Less: Ending work-in-process Cost of goods manufactured Rs. 6.85 lacs. 36
  37. 37. SWOT Analysis Strengths:     Unique Product Line Extension Online Presence Comparative Less Pricing Weakness:  Low Finance  Competitive Pricing  Not suitable for long use Opportunity:  Customization  Color and shapes variation  Bed extension Threats:  Strong Competitor  International Competition  Fancy Furniture in market 37

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