Sandoval Financial & Insurance Center

GROWING TOGETHER
LIFE, HEALTH, PROPERTY & CASUALTY

SERVING
SOUTHERN CALIFORNIA!

(562) 213-9293
LIC#0J19410

Honesty and Integrity

SFandIC:
14254 San Ardo Dr.
Office
La Mirada, CA
90638

Agent:
Jaime R. Sandoval
jaimersand@gmail.com:

www.sfandic.wix.com/sfandic
SFandIC@gmail.com

Indice
1

Executive Summary

Company Description

Strategic Focus and Plan

3.1 Mission . . . . . . . . . . . . . . .
3.2 Goals . . . . . . . . . . . . . . . .
3.3 Core Competency . . . . . . . . . .
3.4 Sustainable Competitive Advantage

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2
2
2
3
3

Situation Analysis
4.1 SWOT Analysis . . . . . . . . . . .
4.2 Industry Analysis . . . . . . . . . .
4.3 Competitors in the Insurance Market
4.4 Company Analysis . . . . . . . . .
4.5 Customer Analysis . . . . . . . . .

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3
3
5
7
7
8

Product-Market Focus
5.1 Marketing and Product Objectives
5.2 Target Markets . . . . . . . . . .
5.3 Points of Difference . . . . . . . .
5.4 Positioning . . . . . . . . . . . .

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8
8
9
9
9

Marketing Program
6.1 Product Strategy . . .
6.2 Price Strategy . . . .
6.3 Promotion Strategy .
6.4 Distribution Strategy

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9
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Financial Data and Projections

11
7.1 Past Sales Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Implementation Plan

11

Evaluation and Control

11

10 Appendices

11

Executive Summary

Company Description

SF&IC, started by co-founders Sandra S. and Jaime R. Sandoval to develop and market
Sandoval Financial and Insurance Center, a unique line of insurance products. The Sandoval
Financial and Insurance Center line of insurance was first introduced into the South Gate,
California market.
To the Companys knowledge, SF&IC is only premium-quality, authentic to grow together, with insurance sold in the California area. Its high reputation has gained fast, widespread acceptance in these regions. In fact, we have increase our clientele sales as of a few
months ago for which data are available. The Company believes the Sandoval Financial and
Insurance Center brand can be extended to other categories of financial products such as real
estate which we are ready to complete this field by summer 2017.
SF&IC believes its high-quality research, high-expertise in the field has proven succesful. This marketing plan outlines how the Company will extend its geographic coverage
from one area to the entire State by 2022.

Strategic Focus and Plan

This section covers three aspects of corporate strategy that influence the marketing plan:(1)
the mission, (2) goals, (3) core competence, and (4) sustainable competitive advantage of
SF&IC.

3.1

Mission

The mission and vision of SF&IC are to market lines of high-quality insurance products
at premium prices that satisfy consumers in this fast-growing insurance segment while providing challenging career opportunities for employees and above-average returns to investors
to achieve a well standard of living utilizing these to principles of "Honesty and Integrity".

3.2

Goals

For the coming five years, SF&IC seeks to achieve with no hesitation the following
definitions:
Definition 1 (Nonfinancial goals)
To retain its present image as the fast highest-quality line of insurance products in the
categories of insurance in which it competes.
To enter 9 new metropolitan regions.
To achieve national producer in two convenience areas or region by 2017 and five by
2018.
To add a new region every third year.
To be among the top three insurance line producers.

 To provide the best customer service

Definition 2 (Financial goals)
To obtain a real (inflation adjusted) growth in earnings per share of 8% per year over
time..
To obtain a return on equity of at least 20%.
To have a public stock offering by the year 2022.

3.3

Core Competency

In terms of core competency, SF&IC seeks to achieve a unique ability (1) to provide
distinctive, high-quality insurance and real estate products utilizing insurance that appeal to
and excite contemporary coverage for these products. and (2) to provide these products to the
customers hands using effective technology and agents that maintain the Companys quality
standards.

3.4

Sustainable Competitive Advantage

The Company will work closely with key suppliers to build the relationships and alliances
necessary to satisfy the high standards of our loyal customers to Grow Together. At the
same time we are training our agents to be a step ahead of the competition.

Situation Analysis

This situation analysis starts with a snapshot of the current environment in which SF&IC
finds itself by providing a brief SWOT (strength, weaknesses, opportunities, threats) analysis.
After this overview, the analysis probes ever-finer levels of detail: industry, competitors,
company, and consumers.

4.1

SWOT Analysis

Figure 1 shows the internal and external factors affecting the market opportunities for
SF&IC. Stated briefly, this SWOT analysis highlights the great strides taken by the Company
since its products first appeared on the South Gate, CA region. In the Companys favor internally are its strengths of an experienced management team and board of directors, excellent
acceptance of its lines in the region in which it competes, and a strong insurance system to
serve these limited markets. Favorable external factors (opportunities) include the increasing
appeal of insurance products, the strength of the upscale market for the Companys products,
and technological breakthroughs that make its easier for smaller insurance producers to compete.

Figure 1. SWOT Analysis for SF&IC.

Internal Factors

Strengths

Management

Experienced and
entrepreneurial
management
and board

Small size can

restrict choices

Offerings

Unique, high-quality
high-expertise

We-do-not
produce policies

Marketing

Acceptance in the
entire State

No national
presence

Personnel

Good work force,

though small

No replacement

Finance

Excellent growth
in sales revenue

Limited resources
restrict growth
compared to competitors

R&D

Continuing efforts to
ensure quality
in policy products

Lack of knowledge and

more English writing

Weaknesses

External Factors

Opportunities

Consumer/Social

Increased population
likely to be stable;
particularly the
Hispanic market

Threats
Premium price may
limit access to markets;
policyholders value
strong brand name

Competitive

Unique or distinctive
name brand

Competitors may
reproduce our technique

Technological

Apps enable smaller

producers gain
what big producer

Competitors have gained

economies in insurance
and real estate

Economic

Legal/Regulatory

High consumer
income

Several households have

insurance & real estate

Regulated by
Federal Trade Commision
eliminate competitors

Limited resources
restrict growth
compared to competitors

Among unfavorable factors, the main weakness is the limited size of SF&IC relative to its
competitors in terms of the depth of the management team, available financial resources, and
4

national presence of product lines. Threats include the danger that the Companys premium
prices may limit access to mass markets and competition from the markets.

4.2

Industry Analysis

INSURANCE INDUSTRY AT A GLANCE

The U.S. insurance industrys net premiums written totaled $1 trillion in 2013, with
premiums recorded by life/health (L/H) insurers accounting for 54 percent and premiums by property/casualty (P/C) insurers accounting for 46 percent, according to
SNL Financial.
P/C insurance consists primarily of auto, home and commercial insurance. Net premiums written for the sector totaled $481.2 billion in 2013.
The L/H insurance sector consists primarily of annuities and life insurance. Net premiums written for the sector totaled $560.3 billion in 2013.
Health insurance is generally considered separate. The sector includes private health
insurance companies as well as government programs. P/C and L/H insurers also write
some health insurance.
There were 6,086 insurance companies in 2013, including P/C (2,623 companies),
life/annuities (904), health (835), fraternal (87), title (58), risk retention groups (256)
and other companies (1,323), according to the National Association of Insurance Commissioners.
Insurance carriers and related activities accounted for $421.4 billion, or 2.5 percent
of U.S. gross domestic product in 2013, according to the U.S. Bureau of Economic
Analysis.
The U.S. insurance industry employed 2.5 million people in 2014, according to the
U.S. Department of Labor. Of those, 1.5 million worked for insurance companies,
including life, health and medical insurers (838,200 workers), P/C insurers (596,000
workers) and reinsurers (25,200 workers). The remaining 1 million people worked for
insurance agencies, brokers and other insurance-related enterprises.
Total P/C cash and invested assets were $1.5 trillion in 2013, according to SNL Financial. L/H cash and invested assets totaled $3.5 trillion in 2013. The majority of these
assets were in bonds (63 percent of P/C assets and 75 percent of L/H assets).
P/C and L/H insurance companies paid $17.4 billion in premium taxes in 2013, or
$55 for every person living in the United States, according to the U.S. Department of
Commerce.
P/C insurers paid out $12.9 billion in property losses related to catastrophes in 2013,
compared with $35.0 billion in 2012, according to ISO. There were 28 catastrophes in
2013, compared with 26 in 2012.
REAL ESTATE FRANCHISE INDUSTRY AT A GLANCE
The real estate industry has been under scrutiny in recent years with the mortgage crisis
and other current events, but it is still a large field which generates billions or dollars
in revenue. There were 165,000 companies operating in the residential brokerage and

management field last year, which generated $170 billion in revenue, and there were 25,000 companies operating in the commercial brokerage and management field,
generating an annual revenue of $30 billion.
Real estate tends to be a particularly cyclical industry, going up and down based on
trends in the economy at large such as the fluctuation in interest rates. The story of real
estate often mirrors the general story of the American economy. Real estate soared in
the post-World War II 1950s, sank in the 1970s, rose again in the early 1980s until the
depression at the end of that decade, and was prosperous again at the end of the 1990s.
Because of low interest rates in the mid-2000s, residential real estate was booming even
when the economy was slow until the mortgage crisis hit and the bubble collapsed.
After that point it sank and as of 2011 has yet to truly recover. Brokerage firms have
taken on property management divisions in order to diversify their revenue streams and
combat poor economic climates.
The real estate industry consists of three primary fields: brokerages, leasing, and management. Brokers bring together buyers and sellers of property, assist in the price
negotiations and arrange the steps between a buyer first taking interest in a property
and closing, including appraisals and inspections. Generally, the seller pays a commission, dependent on the sale price (usually 5 or 6 percent), and this is split between a
broker working for the buyer and the broker working for the seller. Real estate brokers
must be licensed in the state in which they work. Leasing brings together property
owners with tenants, sometimes owning that property themselves, or subleasing property they have leased from someone else. Management companies are responsible
for making sure their buildings are filled with tenants, deciding what to charge these tenants, making sure the buildings run properly, paying utilities, hiring staff and
other maintenance for owners who do not want to manage buildings themselves. Since
most property expenses are fixed, maintaining low vacancy rates is critical to management companies. In particular, property management has been a fast growing field and
should continue in its expansion, as commercial and residential properties that were
overbuilt during the real estate boom will continue to need management until they are
sold.
The old saying, Location, location, location, is clich but true location is centrally
important to determining the marketplace and the value for real estate. Factors controlling the quality of a location include public transportation access, the quality of
the roads and schools, income levels and stability and success of the local economy.
Some popular real estate franchises are the Century 21 Real Estate franchise and the
Coldwell Banker Real Estate franchise.
In 2010, there were 517,800 brokers working in the United States, 59 percent of whom
were self-employed. The industry is divided into residential and commercial real estate
services, although some brokerages and management companies engage in both. The
residential real estate industry is quite fragmented. The fifty largest companies make up
less than thirty percent of the industrys total revenue. Of the three primary areas, brokerage services compose 45 percent of the industrys total revenue, leasing residential
units makes up 35 percent and property management makes up fifteen percent.
Since the collapse of the housing bubble, residential real estate revenue is still in the
pits and unemployment has remained high. Some predict that when jobs come back en
masse, residential real estate success will follow. The commercial industry is highly
fragmented as well. The fifty largest companies make up one third of total revenue.
The commercial segment of the industry has faired slightly better than the residential
6

segment since the recession. While it has not yet reaching the peaks of 2006 before
the fall, analysts predict that the market bottomed out in 2010 and expect it to rebound
somewhat in 2022.
Potential obstacles for the industry include factors beyond the control of the business
owner, such as downturns in the local or national economy, as well as changing neighborhood demographics where agencies are located. Also out of the owners control
is the building of properties, and what properties in the area are available. For management companies, indoor air quality liability has become a serious legal issue in
recent years. Removal of mold growth in particular has been increasingly necessary
for property owners and managers.
The use of technology will continue to transform the field in the years ahead, enabling
home buyers to research both properties and the areas in which they are located, including looking at pictures and finding out about the neighborhoods schools, crime
rates and other statistics. Marketing over the internet with pictures of properties and
virtual tours will be important for brokers. More than ninety percent of people use the
internet before purchasing real estate. United States population growth will also be an
important driving factor in the growth of the industry at large. The workforce is expected to to grow fourteen percent between 2008 and 2018. The internet arguably may
eliminate the need for brokers altogether in the future. Banks also represent a potential
competitor. Recently they have been freed by rule changes to enter the commercial
real estate field in a limited way, and it is possible to see future rule changes allowing
them to enter the residential field. The biggest growth areas are expected to be in the
southern half ot the country, particularly in the southwest. A recent survey revealed
the hottest buyers market to be Albuquerque, New Mexico.
Even in spite of the poor economic conditions and the state of the industry, analysts are
confident in the future growth in the industry. Brokers commissions are expected to
grow at a compounded rate of fourteen percent annually from 2017 to 2022. The output
of United States real estate businesses is expected to grow at an annually compounded
rate of six percent between 2017 and 2022.

4.3

Competitors in the Insurance Market

The insurance market represents over $1.2 trillion in annual sales. On average, consumers
buy five to six insurance annually. The product fall primarly into two groups: Life and Health
(54 percent of sales) and Property and Casualty (46 percent of sales).

4.4

Company Analysis

Nowadays, Sandoval Financial and Insurance Center product competes in the insurance
and property casualty segment of the South-West/Mexican insurance market. Nonetheless,
the insurance obviously competes as a stand-alone product, its exceptional expertise means it
can complement such lines as health, life, property, casualty and real estate. This flexibility
of use is relatively rare in the underwriting insurance marketplace. With Sandoval Financial
and Insurance Center, SFandIC is broadening the position of producer in a way that can lead
to impressive market share for the new product category.
The Company now uses a single insurance producer with which it works closely to maintain the consistently high quality required in its products. The greater volume has increased
production efficiencies, resulting in a steady decrease in the cost of goods sold.

4.5

Customer Analysis

In terms of customer analysis, this section describes (1) the characteristics of customers
expected to buy Sandoval Financial & Insurance Center products and (2) of Americans today.
Customer Characteristics. Demographically, insurance products in general are purchased by consumers representing a broad range of socioecomomic backgrounds. Sandoval
Financial & Insurance Center insurance is purchased mainly by consumers who have achieved higher levels of education and whose income is $50,000 and higher. These consumers
represent 50% of life and health.
The household buying Sandoval Financial & Insurance Center has one to three people in
it. Among married couples, Sandoval Financial & Insurance Center is predominantly bought
by households in which both spouses work. While women are a majority of the buyers,
single men represent a significant segment. Anecdotally, Sandoval Financial & Insurance
Center has heard from fathers of teenaged boys who say they keep a savings in a piggy bank
because the boy knows finances.
Because the insurance industry offers a quick way to transfer risk, the products biggest
users tend to be those most with less savings. Sandoval Financial & Insurance Centers premium pricing also means that its purchasers are skewed toward the higher end of the income
range. Buyers range in age from 25 to 54 (65 or over for Medicare). Because consumers
in the western United States have adopted the insurance industry more readily than the rest
of the country, Sandovals Financial & Insurance Centers initial marketing expansion efforts
will be concentrated in that region.
Sandovals Financial & Insurance Center is already providing a great premium, best service, and outstanding R&D than its competitors, and those qualities are not currently being
stressed in its promotions. Instead, in the space and time available for promotions, Sandovals
Financial & Insurance Centers rapid, trustworthyness, and flexibility are stressed.

Product-Market Focus

This section describes the five-year marketing and product objectives for SFandIC and
the target markets, points of difference, and positioning of its lines of Sandoval Financial &
Insurance Center products.

5.1

Marketing and Product Objectives

Sandoval Financial & Insurance Centers marketing intent is to take full advantage of its
brand potential while building a base from which other revenue sources can be minedboth
in and out of the insurance industry business. These are detailed in four areas below:
Current markets. Current markets will be grown by expanding brand and service distribution at the agency level. In addition, same-company sales will be grown by increasing policyholder awareness and repeat purchases. With this increase in same-company
sales, the more desirable broker distribution channel will become available, increasing
efficiency and saving costs.

 New markets. By the end of Year 5, the insurance, and real estate business will be
expanded to a total of 2-3 metropolitan areas. This represent 70% of U.S. insurance
agency sales.
Insurance Service. Insurance service sales will include annuities, life, health, property,
and casualty. Sales are expected to reach $500,000 by the end of Year 3 and $1 million
by the end of Year 5.
New Products. Sandoval Financial & Insurance Centers brand presence will be expanded at the agency level through the addition of real estate section. This will be
accomplished through new product concept screening in Year 1 to identify new potential products. These products will be brought to market in Year 2 and 3. Additionally,
the brand may be licensed in select fields.

5.2

Target Markets

The primary target market for Sandoval Financial & Insurance Center products is housholds with one to three people, where often both adults work, with household income typically above $50,000 per year. These households contain more experienced, adventurous
prospects of Southwestern products and want premium quality results.

5.3

Points of Difference

The "points of difference"characteristics that make Sandoval Financial & Insurance

Center unique relative to competitorsfall into three important areas:
Unique service and technology. No known competitor offers high quality, insurance
service in a range of lines. And no existing insurance has the same combination of
underwriting.
Insurance trends. The American people is increasingly intrigued by transfers of risk,
and Sandoval Financial & Insurance Center brand offer more than most other insurance
providers.
Premium service. Sandoval Financial & Insurance Centers high-value service convey
the unique, high quality product contained inside the policy.

5.4

Positioning

In the past insurace products have been either convenient or by adverse selection but
not both. Sandoval Financial & Insurance Center pairs these two desirable characteristics to
obtain a positioning in prospects minds as very high quality Southwerstern insurance that
can be produced easily and efficiently.

Marketing Program

The four marketing mix elements of the SFIC insurance marketing program are detailed
below.

6.1

Product Strategy

After first summarizing the product line, the approach to product quality and service is
covered.
Product Line. SF&IC, service the prospects depending on there needs for each of the
policy services, is avalilable in several different categories. They are:
Life: Universal life insurance is a form of permanent life insurance characterized by
its flexible premiums, face amounts and unbundled pricing structure. The savings element, premiums and death benefit can be reviewed and altered as a policyholders
circumstances change.
Life: Term insurance provides life insurance protection for a specified period of time. Term life is sometimes convertible to permanent coverage, providing you with
flexibility as your needs change.
Life: Whole life insurance is a form of permanent life insurance that remains in force
for your entire lifetime, provided premiums are paid as specified in the policy.
Disability: Key person disability coverage, principal will now consider $360,000 under
a Simplified Sales Program.
Disability: Presumptive benefit, if you lose total loss of hearing, speech, sight, the use
of both hands, both feet, or either a hand or a foot, a full benefit will be paid regardless
of client working conditions.
Property & Casualty: Property insurance such as dwelling policies, homeowners, and
commercial property.
Medicare: Provided to individuals who reach 65 years of age and in some other cases
with individuals with disabilities.

6.2

Price Strategy

SF&IC service is, at the lowest premium for a quote package, priced comparably to
the other insurance offerings and higher than the local independent services providers. However, the significant return advantages it has over services providers and the convenience
advantages over franchise insurance providers justify this pricing strategy.

6.3

Promotion Strategy
Key promotion programs feature online demostrations, multi-group, and magazine.

Online Demostrations. Online demostrations will be conducted to give consumers a

chance to try Sandoval Financial and Insurance Center products and learn about their unique services. Online demos will be conducted regularly in all social media sites to increase
awareness and purchases.

Multi-group. Because the products flexibility of use is a key selling point, multi-group
will be offered to consumers to stimulate policy ownership. The multi-group will be given at
all employers with three or more employees or according to the size of the company.

10

Magazine. Because the products flexibility of use is a key selling point, magazine subscriptions will be offered to consumers to stimulate policy purchase. The magazine subscription forms will be given at a local supermarket. In addition, magazine subscriptions will be
included in several fliers sent by direct-mail or free standing inserts.

6.4

Distribution Strategy

We need to hire more agents to collect more applications. That will increase capital and
productivity.

7
7.1

Financial Data and Projections

Past Sales Revenues

Historically, Sandoval Financial & Insurance Center has had a steady increase in issuing
policies since its introduction in 2014. In 2016, capital jumped, due largely to new promotion
strategies. Applications have continue to rise, but at a less satisfactorial rate.

Implementation Plan

Introducing Sandoval Financial & Insurance Center to five more metropolitan areas is
a hard assignment and requires that creative promotional activities gain consumer awarness
and initial trial among the target market housholds identified earlier.
The diverse regional ethnicity research in policy will be monitored carefully to assess whether minor modifications may be required in the insurance industry. For instance, what is
seen as "trendy" in New York may not be seen as "trendy" in Colorado. As the rollout to new
metropolitan areas continue, SF&IC will assess underwriting trade-offs. This is important in
determining whether to start new qualify issues of policy with selected high-quality regional
contract.

Evaluation and Control

Monthly policies target in cases have been set for SF&IC for each metropolitan area. Actual case sales will be compared with these targets and tactical marketing programs modified
to reflect the unique sets of factors in each metropolitan area. The speed of the roll out program may increase or decrease, depending on Sandoval Financial Insurance Center markets
it enters. Likewise, as described above in the section on the implementation plan, SF&IC
may elect to respond to variations in regional tastes by using concracts agencies, which will
eliminate risk, but will require special efforts to monitor production quality.

10

Appendices

11