Risk Management Plan Construction of Lellow’s Toys .docx

Risk Management Plan: Construction of Lellow’s Toys
Last Revised: 08/05/2015
Prepared by Group 4
Evan Rapp, Sira Ong, Elyse Powell, Carson O’Rourke, William
Rees
Project Management MAN4583
DUE: 09.06.15
DESCRIPTION
Lellow’s Toys, a popular specialty toystore, is opening there
second location in Athens, GA. Opening this new retail location
will allow the company to expand sales and business into a new
area of town. The company will sell educational toys and games
to people of all ages and genders, disabilities, and conditions. It

will allow children and people to grow and develop better skill.
ROLES AND RESPONSIBILITIES FOR MITIGATING RISK
Owner: Hires management team, payroll and costs, creates
contingency plan for management reserves, transfers risk to
contractors, decides who is best suited for controlling activities,
providing liability insurance, and approving project charter.
Project Manager: Plans and executes project, oversees the
project, reconstruction on rental, holds meetings for the project,
budget reserves such as allocating resources to project
activities, ensures that the project is approved, processes and
completes project in an orderly fashion, developing methods to
assess and resolve technical uncertainties, and hiring the
coordinators and contractors to assist with store grand opening.
Project Assistant Manager: Assists project manager with
responsibilities, delegating tasks and responsibilities to
contractors and coordinators, and acts as project manager when
project manager is unavailable.
Contractors: Taking ownership by absorbing risks, identifying
and documenting responsibility, does the actual work,
coordinates their contributions with the project team, providing
support to project scope, and completing segments by deadline.
Store Manager: Supports project manager, orders inventory and
expenses, trains employees, delegating tasks to employees,
following through with employees to ensure tasks are
completed, communicates with store owner, ensuring customer
satisfaction, and loss prevention.
Employees: Stocking shelves, merchandizes displays to
planogram, hanging signage, cashiering, verifying correct
prices, gift wrapping and personalizing toys, providing
excellent customer service and experience.
Sales Marketer: Provides marketing tools, advertising,
providing signage, creates planograms for merchandising, and
ensures store managers are merchandising displays to
planogram.
Finance Team: Processes, underwrites, and approves project

plan, and finances project.
BUDGET
Total budget break down is listed below, followed by its risk
analysis on page 7.
Total Budget $250,000
Lellow’s Toys: Risk Management Plan Group 4-1
Lellow’s Toys: Risk Management Plan Group 4 –
7
Revision 20150805
Risk/Association: Timing and Delivery
Risk Owner: William Rees
Description of Risk: Supply chain failure for on-time delivery
of product inventory for Grand Opening Day
Score: 4
Likelihood: 1
Impact: 4
Rank:
Current Internal Controls and Their Effectiveness:

· Ordering product in advance |
· Communicate and outline necessities to vendors |
Proposed Actions to Reduce Likelihood of the Risk
Target Completion Date
Status and Impact of Actions
1
Order product in advance, to ensure delivery
03/31/2016
Ordering in advance allows for the option of receiving product
earlier,
rather than later.
2
Develop relationships with other vendor/
suppliers
01/01/2016
Developing relationships with other vendors and suppliers
allows for
other opportunities when selling product, and ensures that there
will be product in the store if number 1 vendors cannot supply.
3
Offer Incentives to ensure on-time delivery
01/01/2016
This may cost a bit more financially, but will ensure that no
matter what
the product is delivered when asked.
Proposed Actions to Reduce Impact of the Risk
1

Having other back up options in place for
Product, in case it is B.O. or not delivered.
03/01/2016
Having other options in place of product that may not be
delivered,
allows for better options and the option to continue to sell
product.
2
Offer Incentives to ensure on time delivery
01/01/2016
This will help to reduce the effect of no inventory
Risk/Association: General Risk Associations
Risk Owner: Carson O’Rourke
Description of Risk: The store and all items inside (shelving,
plastic toys, plush toys, employees, restroom, power outlets,
displays, etc.) must be safe for children of all ages. This is a
high risk category, any safety issues could lead to down fall of
the store. All shelves and displays need to be secured as to not
fall and injure children or parents also employees must be
screened well to avoid any compromising situations where the
store could be liable.
Score: 15
Likelihood: 3
Impact: 5
Rank:

· All racks are ordered from the companies that sell the product
|
· Protocol for the store, restrooms and backrooms are up to
OSHA standard |
· Application for employees has strategic questions |
·
1
Secure racks to floor and walls to prevent falling
03/31/2015
Prevents racks from falling on top of children
2
Hang certificates of OSHA compliance
Immediately
Certificate should be received and showing as soon as the store
can have contractors, workers, or anyone. This will cover legal
liability.
3
Perform background check on employees
N/A After interview process
Allows for safe environment, and help to assist with liability
concerns
1
Similar to likelihood risks

If completed, the impact of liability can be reduced
significantly.
Risk/Association: General Risks
Risk Owner: Carson O’Rourke
Score: 16
Likelihood: 4
Impact: 4
Rank:
Description of Risk: Product shrinkage can happen either
through theft or from accident destruction by children, this must
be monitored as any shrinkage results in an immediate loss to
the store. Also shrinkage is something that can be controlled
with the proper measures which can be determined after opening
but measures before opening can be implemented like security
cameras and security tags on higher priced items to avoid theft.
· Have an employee by front door at all times, one at the
register, and one watching around the store to ensure visual
security of product coming in and out. |

1
Security Cameras
02/01/2015
Security Cameras will allow review and understanding of where
lost
product has gone, and also how employees react.
2
Security Tags
After inventory received
Will alert store employees when expensive product has walked
out of
store.
1
Make sure small product is by register
04/30/2016
Tiny product pieces near register are less likely to walk than
those that are
not. This can assist with loss prevention.
2
Ensure that employees are trained on theft
Awareness
04/30/2016
This will assist employees with understanding what to be aware
of, how to be safe, but also prevent theft from happening
frequently in the store.

Risk/Association: Finances
Risk Owner: Elyse Powell
Score: 6
Likelihood: 3
Impact: 2
Rank:
Description of Risk: Original cost of budget was $200,000 for
even number purposes. After looking up cost commercial costs
of improvements, equipment, and inventory cost was increased
by $43,000 over the original number. These numbers include the
cost of labor as well as Georgia averages for the salary ranges.
However, there is always room to cut cost depending on the
location that is chosen for the store and how much restoration
and improvements that to be done. The budget was then raised
to $250,000. The idea of this continuing to happen, and
handling increase in inventory cost or construction costs are
risky.
· Have a strict budget with researched set costs |
1

Ask for proposals from various contractors, don’t
settle with the first team that is met with.
11/01/2015
Want to find a team that is cost effective, but will also ensure
that our project is completed in a timely and efficient manner.
2
Make sure inventory is good quality inventory,
but check with all vendors to ensure that we are
getting the best bang for our buck. Maybe talk
about free racks with purchases as well.
01/31/2016
Want to make sure we speak with all vendors about their pricing
and
deals, this will allow us to save money by purchasing a variety
of
products, and getting a discount on what we purchase.
3
1
Ensure that credit is in a good place for additional loans if
needed
11/01/2015
Want to ensure that all credit and financials are at a stable point
to
pull out more loans, and cover any other financials so the
financial
hardship is not difficult if this does in deed happen.
2
Make sure that the budget has a cushion of at
least $10,000

11/01/2015
Want to make sure additional funds are in the budget to cover
for the
Costs of unplanned emergencies and issues that will happen.
· Currently looking to sell educational toys, books and games |
· Location within short distance of Toys R Us, Walmart, and
Target |
· Wooden and American Made toys are our specialty |
Description of Risk: Specialty Toy Store may not obtain as
much business because of higher priced and more unique
options to select from.
Rank:
Impact: 5
Likelihood: 2
Score: 10
Risk Owner: Evan Rapp
Risk/Association: Methodology
1
Offer free gift wrapping and personalization with

any purchase
03/31/2016
Free gift wrapping and personalization will make customers
more prone to
purchasing product, knowing that their getting more ‘bang for
their buck.’
2
Educate employees on the specialty of the
Product and how beneficial each piece is
03/31/2016
Training employees on each product piece and explaining how
they can
benefit various types of children and people allows the
consumer to have
a better understanding of the products and want to purchase
more product
from our store.
1
If this happens, go to cheaper yet efficient product
06/01/2016
We will already have other vendor options, but if we are not
receiving customers because of pricing and other concerns, we
will need to lower the cost effectiveness of our product.
Improvements
Paint137.00$
Furniture700.00$
Lights500.00$
Locks100.00$
Flooring2,000.00$
Equipment

Cashier stations [2]1,000.00$
Shelving units1,400.00$
Registers500.00$
Price Guns120.00$
POS system1,500.00$
Computers [4]3,200.00$
Signage430.00$
Salary
Managers [2]80,000.00$
Employees [4]72,000.00$
Inventory
Toys80,000.00$
Total:243,587.00$
Sheet1ImprovementsPaint$ 137.00Furniture$ 700.00Lights$
500.00Locks$ 100.00Flooring$ 2,000.00EquipmentCashier
stations [2]$ 1,000.00Shelving units$ 1,400.00Registers$
500.00Price Guns$ 120.00POS system$ 1,500.00Computers
[4]$ 3,200.00Signage$ 430.00SalaryManagers [2]$
80,000.00Employees [4]$ 72,000.00InventoryToys$
80,000.00Total:$ 243,587.00
Tri C Brands LLC
Risk Management Plan:
Global Expansion for Jessica Simpson & Tri C Brands LLC
Created: 01/29/2016
Prepared by Group 4:
Karen McCullers, Janvier Nshumyumuremyi, Sira Ong, Teresa
Paige & Cortlyn Pence

Project Management MAN4583
Submission Due: 01/31/2016
SCOPEProject Description
Tri C Brands LLC has been contracted to introduce the Jessica
Simpson Collection clothing line to the international market.
Tri C Brands LLC intended successful outcome of this project is
through the use of the collaborative efforts of licensor/licensee
agreements.Project Purpose
The purpose of this project is to expand the Jessica Simpson
Collection to the international market and increase the customer
base. This ties in with the company’s strategic goals and
objectives by building brand awareness and increasing revenues
while maintain sustainability values. Tri C Brands LLC
objective is to establish collaborative arrangements with
licensees on the global market for design, sourcing,
manufacturing and distribution processes. Business Case
This project will benefit Tri C Brands LLC if the
licensor/licensee collaboration is implemented properly and in a
timely fashion. Jessica Simpson is a world-wide, well-known
singer-celebrity with a strong social media presence. With the
Tri C Brands LLC name aligned with the success of the Jessica
Simpson Collection celebrity launch, the company can build a
strong reputation to be the “go to” company for other strong
brand collections looking to expand from the national to the

international stage.Business Requirements
The high level requirements that the Jessica Simpson Collection
clothing line launch will need to fulfill:
· Maintain Strong Brand Management
· Identification of Licensed Product
· Exclusivity of License-Territory Terms
· Royalty Rates
· Reporting Requirements
· The License Term PeriodSummary of Budget
The budget for this project is $20 million dollars. It is to be
funded 60% by the Jessica Simpson Collection Corporate budget
while the remaining 40% will be from Tri C Brands LLC “Brand
Awareness Building” budget.
Constraints
Tri C Brands LLC will need to be aware of outside parameters
that the company will need to look for when using the license
collaboration agreement for the Jessica Simpson Collection.
One item is to keep a check on the scope of control. It is best
to do this to make sure that the licensee is staying within the
license agreement policies that were established, plus to make
sure that the licensee does not have a conflict of interest in
selling a similar competitive product. Another item to be aware
of is the selection of the partner, to make sure that the chosen
partner is held accountable for following the international
license guidelines, see if the partner is part of the ABRAL,
which is equivalent to the United States International Licensing
Industry Merchandiser’s Association (LIMA) (Peabody,
2014).Risks
Risks that Tri C Brands LLC will need to look out for is the
impact of different cultures of the countries that the company
will be trying to establish licensor/licensee agreement in. There
needs to be a low language barrier for clear communication,
political factors which may impact the United States Trademark
laws, and the possibility of strong currency fluctuations and
back up procedures in place in case this occurs (The Pros &
Cons of Licensing, 2015).Project Deliverables

After the completion of this project, the deliverable will be the
Jessica Simpson Collection clothing line launched successfully
on the global market through the use of licensor/licensee
collaboration agreements in various countries.Project
Milestones
Estimated Project Milestones are as follows:
Milestone Date
Milestone Name
Milestone Description
May 1, 2016
Licensee Research Complete
Licensee Research has been completed and are approved so the
project can proceed with the licensor/licensee collaboration
agreements.
Nov 1, 2016
Licensor/licensee collaboration agreements complete
License agreements are completed and signed off. Project is
ready for a soft launch in England and Argentina.
May 1, 2017
Deployment of licensor/licensee system to remaining licensees.
The licensor/licensee system has been a successful collaboration
with end-user acceptance testing and is expanded to further
countries for deployment
Project Manager
The project manager is Cindy Hanke. Cindy will assume the
role of developing the organizational cross functional team to
see that the Jessica Simpson Collection project is handled by
the employees with the strongest knowledge base in dealing
with licensor/licensee rules and regulations. Due to the nature
of this project, Cindy will have high levels of authority in all
areas of the project decision making project with the approval
needing to be from the Chief Executive Officer, John Odom.
Cindy has been this amount of authority due to her certification
as a Project Management Professional from the Project
Management Institute (Larson & Gray, Project Management:
The Mangerial Process, 2014, p. 4)Project Roles and

Responsibilities (Owner - Cortlyn Pence)
Name
Role
Responsibilities
Lisa Schien
Licensing Merchandising Lead
Lead the support licensor/licensee processes in business and
product developments needs through brand presentation and
marketing materials and maintain license agreements & brand
integrity across multiple product categories through clear
communication of design.
Julie Graham
Brand Lead
· Plan and complete testing in all stages of patent registration
· Maintain traceability to requirements to ensure that all
requirements are tested.
· Responsible for trademarks standards testing tools

BUDGET-(Owner – Teresa Paige)
Total budget break down is listed below, followed by the timing
risk analysis on page 6. Additionally: Please note the time
parameters for this breakdown is 12 months from a start date on
May 1, 2017.
Total Projected Budget $20,000,000
CURRENT BUDGET PROJECTIONS
Jessica Simpson Collection Corporation
12,000,000
Tri C Brands LLC
8,000,000
Manufacturers
(6,000,000)
License Costs
(4,000,000)
Testing
(4,000,000)
Compliance Research
(2,000,000)

Translators
(2,000,000)
Translators
(2,000,000)
In review of the above allocation of funds it has come to our
attention there are additional needs to successfully expedite this
process that were not inlcuded in the origninal summary budget.
These additional paramaters and needs for an expanded budget
have not been included in the projection. Please see below for
utilization of additional funds and allocation.
MODIFIED BUDGET PROJECTIONS – ADDITONAL COSTS
Jessica Simpson Collection Corporation
12,000,000
Tri C Brands LLC
8,000,000
International Magazine
Marketing Campaign
(5,000,000)
Internet Advertising
(2,000,000)
Due to the obvious need for marketing campaigns and
advertising, additional funds should be permisssable. A revision
of original summary of budget should be drafted and approved
for these needs. An estimated cost of $5,000,000 from Jessica
Simpson Collection Corporation and $2,000,000 from Tri C
Brands LLC will need to be approved.
JESSICA SIMPSON & TRI C BRANDS LLC GLOBAL
EXPANSION: RISK MANAGEMENT PLAN Group 4-1
JESSICA SIMPSON & TRI C BRANDS LLC GLOBAL
EXPANSION: RISK MANAGEMENT PLAN Group 4-5
Revision 01.29.16

Risk Owner: Teresa Paige
Risk/Association: Timing
Score: 19
Likelihood: 5
Impact: 5
Rank: 9
Description of Risk: Implementation date of 05/01/2017 is
compromised due to marketing budget restrictions.
· Expediting revised proposal with new budget parameters.
· All other budget parameters have been met and will
successfully allow implementation of accepted agreement.
· Licensee/Licensor research is near completion and ahead of
schedule to be completed by projected date. Therefore allowing
other milestones to be achieved on or by target dates.

1
Immediate draft of new summary of budget
to be delivered and signed.
February 28, 2016
Without signatures for this new agreement the collaboration
could be
dissolved or delayed.
2
Moving forward without delay on licensing
agreements and compliance measures.
Immediately
To continue moving forward with international licensee/licensor
compliance agreements prevents future delays.
1
Generate new proposal and expedite to necessary partices
parties immediately.
February 05/2016
Generating the revised proposal immediately with detailed
explanation
will prevent further delay of launch of product and future
relationships.
2
In the event of pushback – offer a compromise of
marketing cost absorption.
TBD
Having a previously approved number for negotiation, should it
be
countered, will allow time to be saved.

Risk Owner: Karen McCullers
Risk/Association: General Risk - Internal
Score:
Likelihood:
Impact:
Rank:
Description of Risk:
|
·
1
2

3
1
Risk Owner: Karen McCullers
Risk/Association: General Risks - External
Score:
Likelihood:
Impact:
Rank:
|

1
2
1
2

Risk/Association: Methodology
Risk Owner: Janvier Nshumyumuremyi
Likelihood:
Score:
Impact:
Rank:
Description of Risk: Less advetisiment due to budget delay .
·
Trying to advise the company 6 months before it lunches.
1
2

3
1
2
Risk Owner: Sira Ong
Risk/Association: Finances

Likelihood:
Score:
Impact:
Rank:
1
1
2

References
Hamel, G. (2016, January 12). How Are Projects Linked to
Strategic Plans? Retrieved from Chron:
http://smallbusiness.chron.com/projects-linked-strategic-plans-
38577.html
Jessica Simpson Logo. (2015). Retrieved from Hunt Logo:
http://www.huntlogo.com/jessica-simpson-logo/
Larson, E. W., & Gray, C. F. (2014). In Project Management:
The Mangerial Process (Sixth ed., p. 4). New York, NY:
McGraw-Hill Education.
Larson, E. W., & Gray, C. F. (2014). Project Management The
Managerail Process. New York: McGraw-Hill Education.
Peabody, A. (2014, May 1). Brazil Steps Up Its Licensing
Game. Retrieved from License! Global:
http://www.licensemag.com/license-global/brazil-steps-its-
licensing-game
PMI. (2013). A Guide to the Project Management Body of
Knowledge: (PMBOK® guide) (5th ed.). Newton Square, PA:
Project Management Institute. Retrieved January 27, 2016
The Pros and Cons of Licensing. (2015). Retrieved from
Licensing and Licensing Agreements:
http://www.referenceforbusiness.com/management/Int-
Loc/Licensing-and-Licensing-Agreements.html

Risk Management Plan Construction of Lellow’s Toys .docx

Risk Management Plan Construction of Lellow’s Toys .docx

Recommended

Recommended

More Related Content

Similar to Risk Management Plan Construction of Lellow’s Toys .docx

Similar to Risk Management Plan Construction of Lellow’s Toys .docx (20)

More from joellemurphey

More from joellemurphey (20)

Recently uploaded

Recently uploaded (20)

Risk Management Plan Construction of Lellow’s Toys .docx