Independant Business Plan

San Leandro DECA Chapter

San Leandro High School
2200 Bancroft Avenue
San Leandro, CA 94577
Trozalla Smith
11-28-16

Table of Contents
 I. Executive
Summary...1
II. Problem
3
III. Customer
Segments3-4
IV. Unique Value
Proposition.4
V. Solutions
..4
VI. Channels
..5
VII. Revenue
Streams...5
VIII. Cost
Structure..8
IX. Detailed
Financials..10
X. Key
Metrics...14
XI. Competitive
advantage14
XII. Conclusion.
....15
XIII. Bibliography
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 Executive Summary

Introduction
During this day and age everything is consumed with technology lots of people will just send an

e-message. But with Enchanted Greetings we are striving to keep the traditional greeting cards

alive but with a little twist. These greetings cards are so much different than the original plain

cards you can purchase. These cards are pop up cards that have a magical feel. A magical feel?

Yes a magical feel. The cards include princesses, kings, fairies, unicorns, anything you can

imagine can be included in the card. With Enchanted Greetings you will find the card you are

looking for.

Customer Appeal
Do you know someone who loves magical things? What about someone who you like but do not

quite know how to tell them? Well do we have a great option for you! Enchanted Greetings is a

magical card business which gives you the opportunity to custom design a greeting card or

choose from our wide selection. If you decide to purchase a build your own card kit you will be

able to hand make your card with the included decals, paper, and the main paper structure that

helps create the pop up effect.

Demographics
Enchanted Greetings are mainly purchased by Baby Boomers and Generation X. Since the cards

are very versatile due to the constant changing market they can be given to boys, girls, men, and

women anyone 3 and up. People in the baby boomer generation are usually married and retired

with a higher spending power. While Generation X is very fastidious and particular in what they

buy. This makes them both the perfect target market. Enchanted greetings cost 12 dollars and up

because they are specialty cards with a magical feel that pop up. These cards have a very diverse

target market with any back ground because the website takes you worldwide.

Socio- Economic Class Pacific Northwest, Midwest

Regions Baby Boomers and Generation X

Geographic Segmentation Exurb and Suburban Areas

Unique Value and Competitive Advantage

Enchanted Greetings is not an ordinary card business. Enchanted Greetings likes to take the

buyer into consideration, we have built our company off customer reviews of other businesses.

We look and see what is missing or what can improve in the card business and apply it to our

business. What makes our company unique is that no one can find any cards like ours and to

keep it that way copycat rights will be established.

 Funding

Enchanted greetings is looking for a 200,000 dollar investment which includes a 3% return over

a 6 year period. The money invested will be used for creating and enhancing the company name

through newspaper, web page, and social media platforms. After the first year Enchanted

Greetings will be able to start paying back the 3% promised and hopefully begin to expand the

company. The money will also be used for purchasing a small manufacturing space which will be

covered by the investment for 1 year.

Conclusion

The following business plan includes information of our management and growth

strategies,product description, and financial objectives. Enchanted Greetings will be a very

profitable business everything is explained and organized in a manner that makes sense to the

possible investor. This will be a great company because it helps re create jobs, help bring back

enjoyment, sense of accomplishment and hand making a gift.

Problem

The three main problems that arise with the card business is not being able to find a card that

meets your needs, not being able to personalize your card, and not enough variety in occasions.

With not being able to find a card that meets your needs will be addressed by Enchanted

Greetings having an 100% satisfaction guarantee. With Enchanted Greetings if you dont find the

card you are looking for in our store or website we will custom make your card. In finding a card

that is personalized has never been this easy we also sell, build your own card kit. These kits run
the same as a regular card but they are just not made. Our cards are for any occasion you can

think of, such as Birthdays, Holidays, Anniversaries, Graduations.

Customer Segments

The target market for my product is Generation X and Baby boomers. The people that mainly

purchase my cards live in the suburban and Exurb areas. These areas are not the only area

Enchanted cards are purchased since we have our web page which has the worldwide shipping

option. Most people are looking for an easy and personal way to show someone you care and we

Enchanted Greetings make it possible.

Unique Value Proposition

Something that makes Enchanted Greetings different than the other card businesses is that you

are able to personalize your cards. You have the option to choose from a variety of kits and build

your card. For example let us just say you wanted a birthday card. So you will pick the birthday

choice and inside the kit there will be the main pop up and a few decals for the birthday kit it

would be presents, balloons, ribbons and streamers. Once you purchase the kit everything will be

included in the package so all you need is your creativity. This will bring back enjoyment of

making gifts for the ones you care for not just getting a basic card.

Solution

There are three problems that were found when looking at reviews of other companies. The two

problems that get solved by custom designing was that the cards did not seem personal and they
could not find what they were looking for. The last problem is that there was no card for that

certain situation. The cards people found did not fit their situation and the cards did not fit the

buyers personality We solve that by making cards for a large amount of occasions. Such as first

bike, birthdays, Half birthdays, anniversaries, breakups, lost first tooth and many others.

Channels

With the money from the investor we will be able to build the three main platforms we will be

promoting our business on. We will have social medias to try and target Generation X the social

medias we will have are SnapChat, Instagram, and Facebook but we will let go and add some as

the tech industry continues to change. We will also promote our business with ads in newspapers.

The reason we will be taking the route towards newspaper ads is because of the Baby Boomers

in our target market, Baby boomers tend to read the daily or sunday paper which our add will be
in. The last thing we wi ll do to promote Enchanted

Greeting is with flyers. Since our company is a printing and design business it will be easy for us

to create flyers that can be posted all around. Once our business expands then we will also

expand our channels with commercials.

Revenue Streams

In the graph below it shows the production of the product what happens from the sale to the

profit.The customer charge is $12.00 and up but for the graph it is set at $12.00. Because it

ranges from which product you buy such as the regular pop up cards are $12.00 and the kits

range depending on how elaborate you want the card to be. For the general sales tax it is 9.50%

which totaled to -1,346.34 for the first year. The wages are $11.00 per hour which equal to

$2,400.00 for the first year since we had only one employee.
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The way we will calculate the pay for each product is shown below, first the customer will

choose the type of card they want or the type of card kit they want and the prices will be listed

Occasion Card $12.00

Custom Card $15.00

Elaborate Custom Card $20.00

Life Time Values

The committed life time customer is listed in the image below there are a few different ways that

the lifetime values could have been presented but three possibilities are portrayed. They are

represented with equations first ust the average card bought per amount of time multiplied by the

amount of time per year and then multiplied by the life span of the customer.
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Revenue

Lets just say there is 80 customers a day and 40 of them buy regular cards at $12.00 each which

is $240.00 and the other 40 buys specialty cards at $20.00 each which is $800.00 and so

$1,400.00 per day and at the end of the year Enchanted Greetings will acquire 511,00 in sales

and will rely solely on this after the first year when our investment runs out. This money will

also be used to pay back the 3% promised from the investment after the first year.

Gross Margin
For the regular cards it costs $12.00 and it costs $5.00 to make them. So the profit is $480.00 per

day and $175,200 per year. For the basic cards it costs $200.00 per day to make and that is

$73,000 a year. So for the basic cards it is 175,200 subtracted by $73,000 which is $102,200.

And for the Specialty cards it costs $20.00 and it is $7.00 to make. So the profit is $292,000 per

year and $800.00 per day. It costs $7.00 to make which is $140.00 per day and that is 51,100 per

year. And its $292,000 per year and 800.00 per day so that is $292,000 subtracted by $51,100

which is $240,900 profit.

Projected Revenue Cost of good sold Gross Margin

$292,000 - $51,100 = $240,900

Projected Revenue Costs of good Sold

$175,200 - $73,000 = $102,200

Cost Structure

The Customer Acquisition Costs

The advertising cost for the website is $507.00 is the yearly rate for the website. This cost can be

paid monthly but Enchanted pays it all in one payment. The other cost is the newspaper which is

$22.50 per week and $90.00 per month which averages to $1,587.00 per year in advertising. It is

$72,000.00 at the end of year one which gets divided by 12 because each card is $12.00 and

guessing each person buys one card and that is 6,000 customers per month.

Advertising Costs

Website $507.00

Newspaper $90.00

Distribution Costs

The product will go from the manufacturing office to the kiosk to be sold. Which costs $32.00

per week for gas which is $1,664 per year, . Also it is costing us money to ship nationwide which

majority of it will be covered but it is going to cost $3.00 to ship for 6 thousand customers it will

be $1,800.00 per year in shipping costs.

Human Resource Costs

In the first year there is one employee which will be making the cards and filling the online

orders, Enchanted will have there own printer which will print the handmade designs.The pieces

will be put together and the cards will be made. For the first year the main income for human
resources is the add cost which will be put in newspapers for volunteers which is part of the

$90.00 used in the newspaper ad for promoting the business.

Additional Costs

The expenses are rent and lease which is $670.00 per month which is $8,040.00 per year.

The utilities are $75.00 per month which is $900.00 a year. For the salary it is $200.00 and

2,400.00 per month. The depreciation is $167.00 a month and $2,004.00 per year and the

insurance is $180.00 per 3 months and that is $720.00 per year.

B. Projected Cash Flow For The First Year Enchanted Greeting

Statement of Cash Flows
For The Year Ending in
December 31, 2018
Cash Flows from Operating Activities:
Net
Income $70,863.38

Add (Deduct) Non Cash Effects On Operating Income

Depreciation Expense $2,004.00

Increase In Inventory - 0.00

Increase in accounts payable $33,924.00

 Increase in prepaid expenses -$2,307.00 31,617.00

Net Cash provided by Operating Activities 102,480.38

Cash Flows From Investing Activities

Purchase Of Equipment $-7,669.00
$-7,669.00
Net Cash used by Investing Activities

Cash Flows From Financing Activities

Proceeds from Capital Investment $8,000.00

Bank Loan Proceeds 0.00

Repayment of Long Term Loans 0.00

Net Cash Provided by Financing Activities 0.00

Increase in Cash $8,000.00

Cash Balance at January 1, 2018 $102,811.38

Cash Balance at December 31, 2018 $102,811.38

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Projected Balance Sheet End of the first Year

Enchanted Greetings
Balance Sheet
12/31/18
Current Assets

Cash $102,811.38
Invetory $500.00
Prepaid Expenses $2,307.00
Total Current Assets $105,618.38

Furniture & Equipment

Equipment $7,669.00
Less: Accumulated Depreciation -$2,004.00
Total Assets $11,283.38
Liabilities & Partners Capital
Current Liabilities
Accounts Payable $33,924.00
Sales Tax Payable $673.17
Total Current Liabilities $3,597.17
Long Term Liabilities
Bank Loan $34,597.17
Total Long Term Liabilities 0.00
Partners Capital
Capital $8,000.00

Retained Earnings $69,001.83

Total Equity $77,001.83

Total Liabilities & Capital $112,559.00

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Projected Three year plan

With Enchanted Cards the revenue continues to grow. After the First year Enchanted Card will be

able to thrive off its own revenue. In the first year Enchanted Cards was able to thrive off two

investors. For the beginning of the second year the 3% will be paid off during a period of 6 years.

In the first 3 years Enchanted would like to pay off the kiosk and office space and continue to

increase customers. Before the 4th year we would also like to begin and level out any costs an

adjust them.

A Brief Narrative Description Of The Planned Growth

Enchanted Greetings in the future will be able to ship cards worldwide and expand the business

to other areas which will help increase jobs and bring joy to the world one card at a time. Over

the course of a few years Enchanted Cards will be able to expand the target market to so many

other generations. With Enchanted Cards we are going to increase the salary for our employees 1

dollar per year.

Proposed Plan to Meet Capital Needs

Enchanted Greetings is fully funded on two investors for the first year and will thrive for the

remaining The first investor invested $200.000.00 and another investor invested $8,000.00

Investor Amount Invested

John Hernandez $8,000.00

Betty Lou De la Rosa $200,000.00

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Earnings, Short-Term, & Long- Term Borrowing/Payment Plans

The investors will be paid back over a course of 6 years which is the $8,000.00 investment which

Is $111.11 per month over the course of 6 years. For the other investment which is 200,000.00

that will be 2,777 per month for 6 years. This will allow Enchanted Greetings to fully pay back

everything in an appropriate amount of time.

Key Metrics
The way we will maintain the the business is by watching and keeping track of the main

operations the parts that bring and take the most money. For the monthly profit is a big one the

more we sell the more profit we make but we also have to be cautious about the loss and returns.

In the beginning when the business just began there was not a whole lot of profit but there was

loss and returns. But as the business grew and expanded we seen less and less of the loss and

more profit.

Competitive Advantage

One of Enchanted main competitors is Hallmark. With Enchanted Greetings we like to focus on

the customer get their feedback and expand on that. With hallmark there are the regular cards and

some specialty cards but there is no cards that will cater to your needs 100%. Enchanted

Greetings will be one of the first companies to establish an at home build your own card kit.

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Conclusion

Enchanted Greetings seeks 200,000.00 dollar investment with a 3% return over a 6 year period.

Theses payments will be paid in the following year after the business started. Enchanted

Greetings is a business that will thrive with the investment. Enchanted Greetings will bring back

fun and thoughtful and made gift giving to the world. One card at a time.
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Bibliography

https://www.yelp.com/search?find_desc=Hallmark+&find_loc=Berkeley,+CA

https://www.yelp.com/biz/lovepop-cards-livermore-2

http://www.officedepot.com/

http://www.loopnet.com/California/San-Leandro_Office-Space-For-Lease/
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