The Nebula Furniture Business Plan - Term Paper Example

The Nebula Furniture Business Plan And Economic Analysis Explanation of Economic/industrial Analysis Nebula Furniture is a Canadian industry that specializes in the production and designing of furniture and other household equipment that meets the needs and the diverse demand of the consumers globally. However, the industrial and economic performance of this firm is highly affected by a number of economic variables. The performance of the firm is highly dependent on the economic factors and other industrial factors. The future of the project is founded on how well the firm is able to maintain a sustainable economy and sound financial policy. The operation of Nebula has adversely affected the entire industry performance covering all the stakeholders in the industry (Westwood, 56). The financial performance of the entire forestry and furniture industry of Canada highly depends on the financial policies enacted and regulated by the Monetary Policy Committee and other leading financial institutions. These financial bodies are responsible for determining the interest rates and the cost of capital that further affects the cost of borrowing and resource acquisition. In Canada, the monetary authority and central bank are charged with the responsibility of regulating the interest rates and the cost of borrowing capital resources. The Canadian interest has been constant at 1% for over the last two years. The overnight lending rates for inter-bank are also maintained at 1%. Although this rate of interest is relatively low, the economic performance of Canada has been adversely affected by the global financial contagion. This has caused instability in the cost of capital and the collapse of reputable financial and monetary institutions (Abrams, 43-44). The effects of the global financial crisis have spillover to other sectors of the economy including furniture and forestry. The interest rates charged by the financial institution and monetary authorities of Canada influences the cost of capital and borrowings. The lower the interest rates and interbank overnight lending rate implies that the costs of borrowed resources are made affordable and cheaper to higher proportion of the economy, hence, more resources to invest in different businesses and available investment opportunities. The rate of economic growth and development is another factor that influenced the economic performance of the furniture industry and other sectors of the industry. In particular, low economic performance results into lower industrial performance. The forestry and furniture industry depends on the economic performance of Canada. In the year 2012, economy of Canada grew by insignificant 0.6% as compared to the previous years when the economy posted higher returns of more than 2%. A decline on the national economic income and performance results into a significant fall in the performance of other leading sectors of the industry. The muted inflation rate of 2% reported in 2012 potentially affects the industrial performance. In particular, 2% inflation represents a general rise in the costs and prices of essential commodities. Forestry and furniture industry is also affected by the rise in the costs of basics. For instance, when the consumer price index (CCI) increases, the purchasing power parity and the value of money significantly decline, hence reducing the ability of potential consumers to purchase luxuries such as furniture. The exchange rates have an impact on the economic growth and performance of all the sectors of the economy. However, business activities and enterprises that depend on exports and imports are the most affected business groups. Instability in the exchange rates and international monetary standard lowers or increases the rate at which imports and exports exchange. For instance, depreciation in the domestic exchange makes imports cheap and exports expensive. On the other hand, an appreciation in the exchange rate makes imports expensive and exports cheap. This would imply that traders depending on imported and exported products for their operation are adversely affected by the stability in the exchange rates. The economic performance is measured in the terms of net national income, gross domestic products, and employment rates. The GDP is the measure of the monetary value of goods and services produced in the economy within a given accounting/financial year. The GDP of a country is passed to other sectors of the economy. A lower GDP or NNP implies a lower economic growth rate in the leading sectors. A higher GDP or NNI on the other hand, is an indication of strong economic performance of the main industries. Therefore, a higher GDP is preferred as the returns are higher and promising, thus the furniture industry is will also benefit from positive gross national income. The other factor that affects the industrial performance is employment rate. Lower employment rates imply that more people willing and able to work at the prevailing wage rates are not able to get employed. High rate of unemployment lowers the productivity of the economy. Therefore, the rate of employment impact on the performance of the industry as the labor force is not fully exploited. The projected economic growth rate and GDP of 2.6% in 2013, and a decline in the unemployment rate to 7.8% will results into improved profitability index in the leading industries of Canada. Such improvement in the projected economic growth of the industry of Canada is would be a preferred move for the entire industry of forestry and furniture. Lack of adequate access to information relating to the general economic growth and performance would adversely lower the returns because such information asymmetry generates inequality in the performances of enterprises. To eliminate such inequalities in the access to information, it is important for the concerned industries to ensure information dissemination to all sectors of the economy. The performance of an enterprise is also affected by external factors other than internal factors. Political factors are some of the external forces that have the potential of impacting on the profitability and economic performance of a firm. Politics affects the economy of a country through a number of ways. Political forces determine the financial regulation policies, legal factors, taxation and income policies. Through such politically influenced decisions regarding taxation, legal and ethical issues, or other politically influenced system, the operations of the economy depends on the political good will. A flexible tax policy and relaxed regulatory frameworks in Canada serves as the good building blocks for the success and strong future of the business community. A low taxation policy accompanied by low tax rate especially for timber and furniture products makes these products affordable to all consumers, including low income groups. In addition, a political goodwill is essential in creating a business favorable environment for all the stakeholders. Regulation frameworks are created by the relevant authorities with political powers. The legal structures and institutions charged with the responsibility of enacting legal policies for different sectors of the Canadian economy are mainly composed of political appointments (McKeever, 21-22). Therefore, fairness and justice should prevail in order to ensure equality and fairness to the entire business community, including furniture and timbers sector. Finally, the potential of economic growth is highly influenced by social forces. The main socio-economic forces that have the potential of determining the extent of industrial growth are demographic statistics, income of the consumers, and composition. The rise in population of Canada significantly account for the increase in the business performance. When the population grows, the demand for product and services proportionately increase. Besides, a rise consumer income is another social factor that positively impact on the performance of the timber and furniture industry of Canada. Increase in the consumer income is characterized by a rise in the purchasing power of the potential customers, which further results into more sales and higher revenue. The role of technological integration cannot be overlooked. The introduction of modern technology in forestry and lumbering is the main reason for the increase in the level of productivity and returns. Modern technology increases the level of production efficiency and reduces the costs incurred in form of wastes. Besides, through technological integrations, the quality of outputs and products of lumbering improves to the expectation of the customers. Therefore, technology should be embraced in all the sectors of the Canadian economy in order to increase the level of economic growth and development and also to make it the economy more competitive. Business Plan Executive Summary The performance of any business is reliant on the external and internal factors and any successful business management require critical analysis of the various factors and their varying impact on output, market and overall survival of the firm. Nebula Interiors deals in products that their production constitutes a number of input factors that scouring is influenced by a number of economic variables. In that regard, drawing a sound strategic business plan requires consideration of costs and market situation. Some of the external macroeconomic variables are of particular focusing in this case so that, market trend can be captured in any policy recommendation to be included in the plan. Implementation of the plan strategies is very vital in the overall productivity of the firm and this is the force behind Nebula interior’s projected target in terms of sales volume and market cover. Our Mission: The mission of Nebular is to offer and supply products and services that will enhance the physical interior beauty the clients’ houses as this promotes appreciation of social order and presentable living in the society. Objectives: Nebular is focused on offering its clients a wide variety of quality furniture to hit and surpass the expectations with efficiency. At the forefront of its objectives, this firm also takes into consideration luxury as very important concept when it comes to interior design business. This has to be done through adopting the culture of offering tailor-made products to its clients to capture the socio-cultural diversity when it comes to desires of people. This is unique to other competing companies and would boost its profit margin substantially. The firm also aims at delivering relax staging experience and high –end quality products that are all round and satisfactory to the various customers. Keys to Success The major keys to success Nebular interior designers enterprise will include: • Location: Nebular Interior Design Company will be located in a place that is accessible and open to clients most of the time. • Environment: The management of this firm is working all the time to ensure that the working environment is conducive as this is instrumental in the performance of the firm. • Convenience: For a better competitive advantage, Nebular interiors embrace the online transactions that are convenient for customers with various commitments. • Reputation: The Company is building on its public image by offering excellent customer service to its clients thereby boosting its market size. 2.0 Company Summary Nebular interior company is planning to upgrade its operation and deal in a wide range of furniture products and expand to interior design services that will complement the demands of the customers. Firm will deliver high quality furniture and offer related services like interior arrangement that is rated at international level and customer oriented. The business is committed to sacrifice all it has in terms of customers in in line with the ethical standards that is vital in setting pace for the competitors in the industry. This is to be boosted by adoption of online marketing and transactions for convenience. The location of Nebular is consistent with the accessibility demands of the client and this is cost effective. The location of this firm is strategic to a place of heavy human traffic that exposes it to greater view. 3.0 Products and Services Nebular is set to scale the heights of interior beauty of houses and offices thereby improving the living standards. The range of products listed by the firm includes • High quality furniture made from wood and metal fabrications • Variety of interior design plans • Interior design services to the clients. 4.0 Strategy and Implementation Summary Strategic plan of Nebula interior company is to use a lot of skills in what is done, excellent customer services, cozy and conducive environment for the clients and the staff. 4.1 Competitive Edge This firm is committed to set standards and become the point of admiration from other competing companies in the same industry that may be offering relatively lower quality of products. This important idea the firm obtains from the clients who state their desire for other complimentary services besides the production and supply of the furniture. In respect of this research finding by the firm, there is potential gain that is awaiting it in terms of market size. On top of supplying the classy furniture, this company will provide after sale services in form of putting fittings and fixtures to the clients. The location of Nebular is strategic and focused towards taking care of the multiple socio-economic classes of clients. This is likely to offer it a competing edge against competitors who may be serving only the affluent in the middle of the town and discriminating middle and low economic class. To boost its public image, this firm offers advisory services to the clients on how to take care of the furniture and enhance their durability. 4.2 Marketing Strategy This firm uses the clients who are satisfied by their products and services to market themselves to other potential customers. When the customers served get their desired services and products, the people who interact with them in offices and homes develop interest and enquire about the firms. This serves to sell the image of the firm and promote its products enabling to it get more customers. This approach of clients being referred is very important in expanding the client base of Nebula interior. From market investigative research, interior design doesn’t require much promotional campaign but instead demands well-structured direct sales and advertisement bases on one on one basis. In respect of this approach, Nebula offers special offers as a mode of marketing mix. Clients who are able to refer others to come and purchase furniture or seek any service are substantially rewarded through discounts on future purchases. The firm also organizes annual expo that attracts various stakeholders and clients and this increases the market size of the company against its competitors who rely majorly on other forms of media that cannot give room for one on one interaction with the clients. 5.0 Management Summary Nebular interior is structured, organized and managed in an innovative and creative way in order to realize efficiency in operation thereby improving the quality of service delivery to the clients. The management is simple with strict adherence to the ethical codes of conduct and spirit of co-operation. To boost its productivity, the firm insists on employing highly trained skilled manpower on pure merit and with a two years working experience or internship of one year within the same industry. 5.1 Personnel Plan Human resource department works on a flexible employment frame work that considers both contracts and permanent employees so that wage bill is economical to the firm. Further annual training of the workers is significant for it improved performance and quality of service delivery. This includes training on communication skills to improve customer relations department and professional interaction with clients. It considers the significant role played by this department in achieving the goals of the firm. Works Cited Abrams, Rhonda M. The Successful Business Plan: Secrets & Strategies. Palo Alto, Calif: The Planning Shop, 2003, pg.43-44. Print. Libecap, Gary D, and Marie Thursby. Technological Innovation: Generating Economic Results. Amsterdam: Elsevier JAI, 2008, pg.20-45. Print. McKeever, Mike P. How to Write a Business Plan. Berkeley, CA: Nolo, 2012, pg. 21-22. Print. Stutely, Richard. The Definitive Business Plan: The Fast-Track to Intelligent Business Planning for Executives and Entrepreneurs. Harlow: Financial Times Prentice Hall, 2001, pg.36-37. Print. Westwood, John. How to Write a Marketing Plan. 2013, pg. 56. Print. Read More