Kingfishers

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Fishing Supplies and Fly Shop Business Plan

Strategy and Implementation Summary

Kingfishers' strategy and implementation are simple. We aim to capitalize on our state's natural beauty and wildlife resources, and the revenue that those two assets bring into the state every year. We will do so by promoting our location, unique marketing edges, and our quality services. By staying ahead of the competition, and creating the leading edge of marketing, we can draw people to our business where we will keep them as customers for life with our belief in customer service and sound business practice, as well as unique products and services.

5.1 Competitive Edge

Kingfishers is a company with a competitive edge. The most important aspect of the business is the location.  Located on highway frontage on the main highway that connects five of the best trout rivers in our state, and serves as the main route between two national parks, we have a huge exposure to potential customers and a great marketing scheme. Whether they are staying in our rustic cabins, renting a boat from us, using one of our guides, or shopping in our store, the customer is centrally located to everything in the area. This means that if one river is not fishing very well for some reason, the customer is just as close to the four other rivers that will be. We make an excellent base camp and meeting place.  

The opportunities for unique and exclusive advertising with our company are huge. Kingfishers can advertise the largest collection of flies in the state. We can advertise that we have one of, if not the oldest, Fly Shop in our county (our building was built in 1943). We can advertise the true rustic spirit of our shop, a log building that has been remodeled to be beautiful inside yet rustic at the same time. Our Lodging is among the nicest and most rustic available, with prices that can compete with even the run-down hotels. We have an Outfitters License that has a very large number of client days on it, and we can advertise that fact.  

Finally, our competitive edge also lies in our attitude. Our Company Mission Statement says it for us. This is the reason people will come back year after year, tell their friends about us, and recommend us to acquaintances.   It is what makes our company different than most others, and why we will build a solid business with a solid reputation.

Three principle items are sold by every business that sells products. They are the product itself, warranty and service. We are very aware that in today’s ultra-productive global society, product quality and name brand only go so far, and warranties are all almost identical. The one thing that is left is service. So above all else, Kingfishers focuses on selling Relationships, built on the piers of unequaled service, industry knowledge and business commitment.

5.2 Marketing Strategy

Our marketing strategy is directed to twin fronts, the local market and the out-of-state market.  Marketing efforts will be divided equally between the two, with tactics specific to each. 

Guide trip bookings are an important part of the business, and most bookings comes from out-of-state.  Guide trips are important for several reasons, the first being that they are very profitable. Second, clients do not just purchase the trip but also spend money in the store. Third, those clients are a very important part of our advertising plan in the form of word-of-mouth advertising that is invaluable to the success of our business. To reach the out-of-state market we will use several approaches:

  • The World Wide Web:  We consider this to be the most cost-effective form of advertising available. Potential customers come to us via search engine hits that post our website based on keyword tags, thus we are presented to a targeted customer who is planning to spend money with somebody. For this reason, we have developed a website that easily rivals any competitors'. It is simple to navigate, easy to understand and read, makes the reader feel comfortable and trusting, and provides pertinent, accurate information, all key things when making a sale. 

  • Fishing Publications: Our target audience also turns to fishing publications when looking for a guide service or ideas on an area to fish. Advertising in these types of publications is key. The drawback is that you are competing with every other guide service and fly shop as well.  Our goal with this type of advertising is to attempt to stand out, while using as little money as possible.

  • Newspaper advertising when feasible:  Newspaper advertising can be effective if done correctly. We believe that by placing ads in key sections of newspapers in large cities we can generate sales. The key to this type of advertising is to get the potential customer to see the ad, and call shortly afterwards. Often, the customer will see the ad, think about it, and go looking for more info and potentially stumble across the competition. Our plan with this type of advertising is to use small ads containing pictures and verbiage that will draw on an emotional response, thereby making the ad memorable. 

  • Occupational publications such as medical magazines:  We consider this strategy our secret weapon. By publishing in publications such as Medical Magazines or other types of professional publications we are doing two things: we are effectively reaching a relatively wealthy audience of educated professionals who fit the target audience perfectly, and we are avoiding our competition while doing so.  

  • Infomercial Video on CD Media: This is our most targeted type of advertising that we will aim at the out-of-state market. We will produce short, 3 to 5 minute infomercials about our business concentrating on our guided trips and lodging. They will include exciting video of boat trips, and the camaraderie that goes along with them as well as a good look at the lodging aspect of the business, and the beauty of the surrounding area. These short CD videos will be sent to the Executive and PR staff of large corporations. Our goal with this is to entice these companies to send us business in the form of PR trips for their potential clients, as bonuses for their employees, or as personal trips for anyone in the company the video gets passed to. We feel this will be a very cost-effective way to get a solid customer base. It is a unique marketing tool for our industry and again avoids marketing in direct competition with our competition.

Local business is very important to us as well, and is why we are using the 2nd half of the marketing budget to reach it. Our local marketing strategy is very different than our out-of-state strategy. While our website will include information for local markets, most of our local budget is going to be spent on the last two forms of media discussed below.

  • Roadside Advertising: We feel that the best form of advertising for our type of business will be roadside advertising, for several reasons. The biggest reason is that any customer who enters our shop or even comes to the general area will have driven there. Our main goal is to get them to notice that there is a great Fly Shop here by placing as many roadside billboards as possible along the smaller highways that come into the general five-rivers area surrounding us. The most advantageous places will be on the opposite sides of the surrounding towns (where our main competition lies), and outside of our town. If possible we will also place billboards at most of the major highway junctions in the area.

  • Radio: All of the local business that we capture will have driven to our location from some distance. For this reason, we plan to place radio ads with the stations that will be most likely to provide coverage over the largest geographic area with the biggest population densities. ROI studies will be conducted as part of the advertising contract to ensure that we can track expenditures against returns to ensure positive ratios.

5.3 Sales Strategy

The objective of our sales strategy is simply to sell something to everyone who comes through the door, and to maximize the traffic flow in the shop. Anglers enter a shop with the idea that, at the very least, there is a possibility that they will make a purchase. To help realize our goals we will do the following:

  • We will merchandise the store products to the greatest benefit, utilizing placement to maximize traffic flow.  
  • Every customer will be made to feel important and welcome. People spend money where they are comfortable and confident, and they buy from people that they like. We will provide both of these environments.
  • A staff member knowledgeable in the fishing and hunting industries, as well as about local details, will always be available on-site.
  • We will offer discounts to local guides who bring customers to the shop or recommend our store.  
  • Toward autumn we will integrate hunting products into the store to continue the season from the summer into the winter months.

5.3.1 Sales Forecast

The sales forecast shown here is based on conservative estimates and could turn out to be underestimated substantially. These estimates do not take into account any Internet sales as the Internet portion of the retail sales plan is new to the operation and competing in an unknown market. We expect that due to the ease of use and sales-friendly structure of the website, our Internet sales will be effective. Therefore, the Internet sales will be used initially as re-investment funding rather than as a substantial part of our financial plan. We will use it to boost the funding of things such as advertising, shop/lodging atmosphere and/or to increase revenue generating services like the number of cabins, or adding boats to the rental fleet.

The fist part of our sales forecast deals strictly with retail sales from the shop. Based on the 2003 Profit and Loss statement of the former owner, by merely increasing the traffic flow by 10%, the closing ratio by 12%, and by increasing the amount of each sale by 12% we can increase overall sales by a total of 35% ($88,500 to $119,218). We believe that new ownership could make these increases with fresh enthusiasm alone. However, coupled with a remodeling of the store which would double the sales space, brightening the interior with lighting and renovation, and fresh merchandise, the sales could easily double. 

The forecast also deals with our available services. We have used conservative numbers here as well, and have information from the competition that suggests our actual sales could be higher. Our two main services are common to the industry and include professionally-guided float and wade trips on the local rivers, and boat rentals to anglers who do not need or want a guide but need a boat. We have forecasted the boats to rent at about 68% (86 out of about 127 days) of the season. We expect 100 to 120 guided float and wade trips the first year, including 50 trips conducted by the owner, and 50 to 70 contracted out to independent guides in the area. 

The third service we offer is Lodging to the Hunters and Anglers in the area. The businesses offering lodging similar to ours report occupancy rates of 95%-100% from mid-spring to late autumn. We believe that we would have a competitive edge in the lodging market, but have forecast our first year at 75% occupancy rate. Even at a 75% occupancy rate, we still show a substantial profit from the lodging, and expect it to grow dramatically. If we see occupancy rates above 80% in the peak seasons, we will increase the number of cabins that we have available at a rate of one per year, which will increase our profit margins even more. Direct inventory costs for lodging (shown below) include soap and toiletries, firewood, and propane; related direct costs for cleaning services and repairs are shown at the top of the Profit and Loss table.

One of the major services that we offer is as a licensing agent for the state. This plays a major role in the business as it draws large numbers of people to the shop. License sales in 2003 topped $29,000. This is an estimated 1,000 people, or about 40% the number of estimated sales in 2003. Capitalizing on this service and increasing it is a key issue to our forecasts and growth.

In addition to the Fishing products and services we offer, we will also offer a variety of hunting equipment, accessories, and apparel to the hunters in the area. We estimate that the store sold 250 hunting licenses in 2003, but stocked no product to sell to those hunters. Our forecast shows what we believe to be an accurate representation of the revenue we can generate in the first 1 to 3 years by providing these products. Once the word of mouth advertising grows and it becomes widely known that we carry these types of items, we will be able to service not only the local resident market, but the state-resident area and non-resident out-of-state hunters as well. By tapping into this revenue source we will be able to accomplish two goals: increasing revenues from sources not taken advantage of by the former owner, and working our way into the Hunting Guide business in the coming years.

The table below shows both projected sales revenue and direct inventory costs for those sales. Direct costs for services (guided trips, boat rentals, cabins) are shown at the top of the Profit and Loss table.

Sales Forecast
Year 1 Year 2 Year 3
Sales
Fishing Equipment $82,816 $95,238 $109,523
Guide Services $37,400 $68,000 $85,000
Drift Boat Rentals $18,840 $19,000 $21,000
Licenses $26,800 $28,500 $30,000
Lodging $63,000 $63,000 $72,000
Hunting Equipment $1,350 $1,200 $1,500
Hunting Apparel $1,350 $850 $1,200
Flies $41,269 $43,000 $46,000
Misc. $2,700 $3,000 $3,500
Total Sales $275,525 $321,788 $369,723
Direct Cost of Sales Year 1 Year 2 Year 3
Fishing Equipment $45,548 $52,380 $60,237
Lodging $315 $315 $360
Hunting Equipment $743 $600 $750
Hunting Apparel $743 $400 $600
Flies $17,743 $18,490 $19,780
Misc $1,080 $1,650 $1,925
Subtotal Direct Cost of Sales $66,172 $73,835 $83,652

5.4 Milestones

The Milestones Table shows the milestones that are important to the operation of the business. Our goal is to get all of our projects completed as soon as possible, but we will use this timeline as a maximum deadline. This will give us time to do the jobs correctly without making the mistakes that rushing can cause while still allowing us to be ready in plenty of time for the main season to begin.

Milestones
Milestone Start Date End Date Budget Manager Department
Close on Business 1/1/2005 1/2/2005 $0 ABC Owner
Implement Web Site 1/1/2005 1/2/2005 $500 ABC Owner
Purchase Additional Inventory 1/3/2005 1/4/2005 $30,000 ABC Owner
Purchase Log Cabins 1/5/2005 1/6/2005 $25,000 ABC Owner
Retail Space Remodel 1/1/2005 2/28/2005 $10,000 ABC Owner
Take Possesion of Business 2/27/2005 2/28/2005 $0 ABC Owner
Start Lodging Lot Prep 3/1/2005 3/15/2005 $10,000 ABC Owner
Recieve Log Cabins 3/15/2005 3/16/2005 $75,000 ABC Owner
Purchase Boats 3/20/2005 3/21/2005 $14,000 ABC Owner
Recieve Total Merchandise 4/1/2005 4/2/2005 $0 ABC Owner
Finish Cabin Furnishing 4/30/2005 5/10/2005 $15,000 ABC Owner
All Projects Complete, Ready for Business 5/15/2005 5/15/2005 $0 ABC Owner
Out-of-State Marketing Campaign 1/1/2005 12/31/2005 $2,250 ABC Mktng/Sales
In-State Marketing Campaign 4/1/2005 12/31/2005 $2,750 ABC Mktng/Sales
Finish Cabin Install 3/15/2005 04/31/05 $10,000 ABC Owner
Totals $194,500