Table of Contents:
Business Overview
1.1 Business name
1.2 Slogan
1.3 Prime function
1.4 Location
1.5 Legal structure
1.6 Business mission
1.7 Business objectives
1.8 Staffing Requirements
1.9 Licensing and legal requirements
1.9.1 How the business will operate
2. Marketing plan
2.1 Marketing objectives
2.2 Competition
2.3 Advertisement
2.4 SWOT analysis (Strengths, Weaknesses, Opportunities and Threats)
2.5 Price
2.6 Target Market
2.7 Product
3. Financial plan
3.1 Financial Objectives
3.2 Startup costs
3.3 Sales forecast
3.4 Monthly cash budget for the first year of operations
3.5 Future prospects
Appendices
Appendix I
- Business card
- Logo
Appendix II
- Sales forecast
Appendix III
- Fixed costs
- Variable costs
Appendix IV
- Breakeven analysis
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1. Business Overview
1.1 Business Name
The business name is SurfScout. This name was chosen because it relates to a section of the
target market which is surfing clubs. SurfScout is also very easy to remember as it is not very
long. The 'Scout' part of the business name refers to the goal of the business which is to
spot sharks to prevent shark attacks.
1.2 Slogan
The business slogan is 'unmanned shark patrol.' This was chosen because it relates to the
device which will be used to find the sharks which will be remote controlled drones that are
fitted with cameras to spot sharks.
1.3 Prime Function
The primary function of the business will be to prevent shark attacks particularly at surfing
competitions and surf club events by using small, remote controlled, camera fitted drones
to spot them before an attack occurs. Another function of the business will be to stop
people from fearing sharks as a lot of Australian families do not go to the beach as often as
they used to because they are afraid of them. By using these drones the business will
hopefully lower the level of fear people face today so more people enjoy Australia's
beautiful beaches.
1.4 Location
The business will be located at a home office in Cottesloe, Western Australia, close to
Cottesloe beach. This places SurfScout very close to Perth's beaches and therefore very
close to the target market. A home office is advantageous because no leases will need to be
paid which will save costs. Since the business offers a service rather than a product, the
requirement for a large business premises will not be necessary. It would be unnecessary to
have a large office space as the business will predominantly operate at beaches.
1.5 Legal Structure
The legal structure of the business will be a sole proprietorship. This is because the profits
made can be kept rather than splitting them as you would in a partnership, all the decisions
can be made by the owner, start up costs will be less if the business is a sole proprietorship
and lastly because establishing and operating within this legal structure will be a lot easier
and simpler than operating a company or partnership. Also if the business was to change
legal structure later on, it would be quite easy to do so due to having a sole proprietorship
structure.
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1.6 Business Mission
SurfScout's mission will be to make Australian surfers, swimmers and families feel safe and
be safe while they enjoy Western Australia's wonderful beaches, particularly at surf club
events.
1.7 Business Objectives
The business has the following objectives:
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To gain and maintain a competitive advantage over other similar businesses
To provide an excellent service for surf clubs and local councils
To gain a reasonable profit
To provide jobs opportunities for adolescents and unemployed people who are
skilled at flying drones and who seek a job.
1.8 Staffing Requirement
The owner of the business who will be the manager. His responsibilities will include:
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Marketing
Recruitment
Management
Interviewing of client
Planning and administration
The manager of the business will not have a consistent set work schedule because in winter
SurfScout will have fewer clients because of the winter season reducing the need for the
service, as less people go to the beach in winter. Hence in summer and the school holidays
the business is likely to have more clients meaning the manager will have to work more
hours.
Three part time casual employees will also be required for the business and their
responsibilities will be to:
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Fly the drones whilst looking through the camera attached to the drone (they will
look on the screen on the controller to see where the camera is facing to spot
sharks)
Monitor the beaches for sharks (great white sharks, tiger sharks and bull sharks)
Alert the proper authorities, surf competition runners and swimmers in the beach
through a megaphone if a shark is spotted
The casual employees will need to be relatively skilled at flying drones to work for SurfScout
and will not require a degree of any sort, consequently resulting in a lower wage to save
costs. He/She will not require any experience or knowledge at management as the manager
would cover that. Each part time casual employee will have to be assessed on how well they
fly the drones beforehand to ensure the right people do the job correctly. Senior surf
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lifesaving cadets and surf life savers who are also skilled at flying drones would be the ideal
employees as they would have previous knowledge on swim safety, in particular sharks. In
interviews these prerequisites would be taken into account when it comes to selecting staff.
All staff members will be required to have a mobile phone and they will be payed $28 an
hour.
1.9 Licensing and legal requirements:
In order for the business to operate as a sole proprietorship, the following legal
requirements must be observed:
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Obtain Tax File Number
Registration of the business name
Pay casual employees superannuation contributions
Obtain an Australian Business Number
Register as a Pay As You Go (PAYG) withholder
The business will also have to follow a certain code of practice concerning employees such
as:
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Preventing bullying, aggression and sexual harassment targeted at the workplace
National Employment Standards (NES)
Providing reasonable working hours
1.9.1 How the business will operate:
Unfortunately the drones that cover SurfScout's requirements do not have a very long flight
time before they have to be recharged. This consequently will result in six drones being
purchased (can be seen in start up costs under the Financial Plan), meaning each part time
employee will fly two drones. Once the first drone is low on battery it will be returned then
placed back on charge and the second drone will then be operated whilst the first drone
regains battery life. The three staff members will each constantly operate two drones rather
than employing more staff members to save expenses later on. If a shark is spotted an alarm
from a megaphone (also can be seen in startup costs under the Financial Plan) will be
sounded to alert the people in the water and the surf club organisers (if clients are surfing
clubs) of the danger. A verbal alert will also be given through the megaphone to alert the
people in danger.
2. Marketing plan
2.1 Marketing Objectives:
The marketing objectives of SurfScout are:
 To promote awareness of the business's service
 To achieve the business mission
 To build strong customer connections in order to build a client network
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To make families, surfers and swimmers feel safe at beaches
To protect families, surfers and swimmers from sharks
To generate profit
2.2 Competition
Surf Scout's Competition would include:
Surf Life Saving Western Australia: despite the fact that this organisation provides manned
on ground beach patrols and helicopter beach patrols, SurfScout has a competitive
advantage over this organisation because of the low start up costs and low expenses. This is
because Surf Life Saving WA would have to purchase petrol and maintenance services in
order to fly their helicopters and a pilot would also be required. Also ground beach patrols
are limited by their ability to only view from the shore line. SurfScout can beat this
organisation competitively because of the better aerial surveillance that the drones would
provide.
Eco Shark Barrier: this business provides a barrier which basically acts as a fence protecting
us from sharks without killing the sharks like a net would. SurfScout beats this competitively
in terms of expenses because the barrier is very costly. People also generally go to beaches
to swim freely and this barrier constricts people to a small area to swim safely in.
SurfScout's competitive advantages:
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Low startup costs and expenses
Not purely profit orientated, so a higher quality of care should be given
Lower maintenance, repair and operation costs
Relatively low wage costs for drone flyers
Allows people to swim safely in larger areas of water (as opposed to a small confined
area, surrounded by a fence)
2.3 Advertisement
SurfScout will undertake the following methods of advertising:
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Brochures - that will be placed at surf clubs and local government council rooms
Direct approaches to surf clubs, local councils and event organisers of surf
competitions
Website - so clients can find out more about what the business does and how much
the service costs
Signage - placed around Perth beaches and close to surf clubs
Social media - Facebook and Instagram
Business cards
Word of mouth - customers will hopefully talk positively about SurfScout.
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Some of these methods of advertising will be advantageous because they won't cost any
money. This is because social media is free.
2.4 SWOT Analysis (Strengths, Weaknesses, Opportunities and Threats)
2.5 Price
The business will charge the service on an hourly basis. The price for the service will be $145
per hour.
This price was decided because:
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The business has a huge responsibility as people's lives are at risk
The business costs $102.8 per hour to operate not including startup costs. Hence this
amount must be charged in order to make a reasonable profit.
The minimum wage is roughly around $16.87 an hour and SurfScout wishes to pay its
casual employees fairly for the job that is required as they have a large responsibility.
Therefore a higher fee for the service is needed.
2.6 Target Market
The target market of SurfScout will include:
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Local government councils - that would purchase SurfScout's service to protect
families, swimmers, surfers, kite surfers etc at the beaches.
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Surf clubs - that would purchase SurfScout's service to protect surfing members
during competitions, lessons and surfing events.
Since the target market includes surf clubs and local councils it would be unnecessary to
spend money on advertising on television and in newspapers because the target market is
less likely to see those methods of advertising as opposed to a sign or brochure placed near
the target market.
2.7 Product
1. Interviewing of clients - The target market will firstly be interviewed to organise
when and where the service will be carried out and for how long the service will be
provided (maximum of 8 hours.) The interviews can take place over the phone or
preferably in person at the home office in Cottesloe. The interviews must take place
at least one week before the day when the service will take place so the business
owner has enough time to inform the three casual employees. At the interview a
series of days where the service will occur can be agreed on (e.g. if the client wants
to hire the businesses service for 4 days then that can be agreed on at the interview)
2. Informing employees - the casual employees will be then notified at least one week
before about the upcoming event when the service will need to be provided.
3. Service - the service will then take place and will go for the number of hours agreed
on at the client interview. At the end of the event the fee will be collected.
3. Financial Plan:
3.1 Financial Objectives
The business will have the following financial objectives:
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To expand financially in the long term by earning sufficient funds
To pay off the family loan after two years
To receive a sufficient amount of income for the owner
A family loan of $17000 and $3000 from the owner's savings account will be paid to cover all
start up costs. All remaining funds from this loan will be kept and then used later for other
additional expenses such as increased costs for advertising. Since the loan is a family loan no
interest will need to be paid on the loan, thus reducing expenses.
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3.2 Startup Costs
3.3 Sales forecast
The following assumptions are made in the sales forecast in Appendix 3:
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In the school holidays SurfScout will have more business (July, October, January and
February)
In winter there will be less business for SurfScout
In summer the business will peak
December and January will be the best months for the business because of both
school holidays and warmer weather
The only business that SurfScout will get in winter is when surf competitions occur
(May, June, July, August, September)
Every year the business will receive an overall profit close to $20000 per year.
3.4 Monthly Cash flow budget for the first year of operations:
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Transport (which can be seen under the fixed costs) costs varied every month because of
certain working days, so the transport cost for every month has been weighted according to
the number of working days every month (which can be seen under Appendix II ‘Patrol Sales
Forecast’)
3.5 Future Prospects
A breakeven analysis and predicted working hours table can be seen in Appendices IV and II.
SurfScout is able to break even in the first year that it operates. At the end of the first twelve
months of operation the business receives a fairly significant profit ($20001) according to
the cash flow budget. In the future the business is likely to change legal structure to a
partnership in the long term to share the responsibility of the owner's position. If the
business continues to be successful and continues to generate consistent profits every year
more casual employees will be employed and in winter when it is colder other alternative
uses for the drones will be considered such as aerial mapping and surveillance services.
SurfScout could also potentially expand into other states and territories for more business.
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Appendices:
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Appendix III
Fixed costs:
Variable costs:
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Appendix IV:
Breakeven Analysis:
Fixed costs = $5130
Variable costs = $43598.52
Service charge: $145/hour
Contribution margin = $25131.48/year ((145 x 474) - 43598.52)
(43598.52/474))
or
$53.02/hour (145 -
Breakeven point = total fixed costs/contribution margin = $5130/$53.02 = 96.76 service
hours
Therefore the business has to make $14030.2 (96.76 hours x $145) before achieving a profit
which is possible according to the sales forecast.
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