6. FINANCIALS
6.9 Long-Term Plan
However, given the trend towards eco-friendly products, and research findings, the product should be well suited to US mom’s online habit shop and preference. We believe that this risk is low.
• Substitute products: the arrival and potential success of Aravore may prompt existing big stores like Target, Sam’s etc, to broaden their product lines and compete directly with our offering.
• Failure to reach sales forecast: Aravore does not plan to use debt financing and plans to run its finances on a ―cash basis. Failure to reach sales target would impact cash flow and could potentially lead to cash flow constraints. That said, a starting balance of $ 30,000 cash (private savings) on hand will provide a cushion to any such risk.
6.9 Long-Term Plan
As a retail business, we depend on our customers. Therefore the only way to increase revenue can be by generating new customers, by expanding sales to existing customers, and acquiring other related customers, for example by referrals from dermatologists or pediatricians.
We will continue business at our retail online store by becoming highly customer-oriented, make it easier for customers to find what they want, and offer more competitive prices. We strive for customer satisfaction and would like that all of our customers leave with the feeling that they would enjoy coming back.
Profits will be intelligently invested to expand our business. One year after the opening, we would like to be able to expand our Internet store to Canada. Profits will be intelligently invested to expand our business. One year after the opening, we would like to be able to expand our Internet store to Canada.
We expect higher revenue by doing so. In one year, we want to have an annual net income of 42,000 USD. If we can keep the business at that level, we will reach 104,000 USD in the second year, 180,000 USD in the third year. With this trend continuous for five years, we
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We approach this business plan with the intention of opening a small boutique after three years of operation. The location will be in San Francisco Bay area. Shipping polity with Aravore UK will be re negotiated.
The possibility of developing a franchising model to aid expansion may also be considered in the future.
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APPENDIX
Some products, on the web-site
Figure 15. Company products
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Table 6. Price list of offered products
Price List
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Table 9. Predicted target market size
Factors % Million People
1. Estimated number of mothers of all ages in the United States: 80.5 million
2. Percentage of mothers, with children age 5 and under, employed full-time, year round:
33%
3. Approximate number of women who give birth each year in the United States: 4 million 4. Mom's that shop online
5. Mom's with low-income household of 35,000 US or below
6. Mom's with medium income household, above 35,000 up to 74.999 7. Mom's with high income household, 75,000 and above US$
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8. Total target of mothers medium high income that shop online 9. Mom's that shop non-organic products
10. Eco-friendly mom's that consciously consume organic products
11. Real target of the business:; out of those 3,5000,000 mom's we will target 3%
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