Soap Manufacturer Business Plan

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Strategy and Implementation Summary

The key element in SAFEassure's initial strategy is to sell the fading dye soap in Portland's day care facilities.  Our executive team will build loyalty for our products with decision-level managers of the organizations in the target markets, and create awareness and support of the benefits of the innovative fading dye attributes of our soap.

Strategy Pyramid

Our ultimate strategy is to build SAFEassure's products into the standard for home and workplace hand washing safety and cleanliness, first regionally and eventually nationally. Our tactics to increase compliance through the use of our product include continual and progressive expansion into new markets and a strong branding campaign in coordination with promotional contracts with the government and possibly insurance companies.

Competitive Edge

Through the successful branding, first-mover advantage, excellent distribution and proprietary position of the company, SAFEassure, LLC will develop brand recognition beyond any competitor. As a small company, we are aware of the disadvantage we have in legal settings, should we face larger, more resourceful competitors. However, a patent for our unique product will provide us with a degree of protection beyond a first-mover advantage by creating an additional barrier to entry. As the market is quickly penetrated, we may have to consider selling the production and licensing rights outright to an established company, should their tactics pose a direct threat to the survival of the company.

Marketing Strategy

For our initial target market of day care facilities, the company will implement two parallel marketing efforts, aimed respectively at day care facility decision makers, and the parents of young children who use these facilities. We will create a push factor by effectively convincing the decision-level managers within the organizations that our product provides an ideal solution to the hand washing compliance. A "first to mind" branding campaign will build CHILDassure as the leader in increasing hand washing compliance. Significant parental support will encourage organizations to implement CHILDassure in environments involving their children.

Positioning Statement

CHILDassure is valuable to day care managers who need effective control solutions to ensure frequent child and child-care worker hand washing to keep the environment clean and to minimize preventable illness. No other product on the market serves the hand washing compliance aspect of workplace safety with such an affordable, direct and complete solution. Unlike traditional soaps, our product provides conclusive evidence every time an employee washes his or her hands for only a marginally higher cost than traditional soaps, and significantly less than gloves or other hand washing compliance systems.

Pricing Strategy

Retail pricing for CHILDassure will generally be around $90/case for four gallons and will command a 25-30% price premium over conventional liquid soaps. The value of our product will not be attractive to extremely price sensitive customers. The market for soap is generally inelastic, but our product offers significant differentiating benefits over current soaps that justify the price difference.

Promotion Strategy

One of the most important aspects of a successful launch is positive publicity for our product. We will develop an awareness campaign to promote our product through several avenues. Our management team will fiercely pursue positive public perception through government endorsements promoting the benefits of our products. We will also attempt to capitalize on the novelty of the solutions provided by our product by actively seeking local news and media coverage to help spread awareness. Buzz will be developed in social hubs by distributing samples to parties with potential interest. Parental support of the product will be garnered through free trials, demonstrations, and direct mailings to the day care parent roster lists, parent groups and PTA's.

At washing stations in client facilities we will spread awareness with stickers targeted towards children, showing them the process of washing to turn their hands different colors and emphasizing how fun it can be. Pamphlets will be sent to the family homes through the day care roster mailing lists, to calm fears regarding a new product in their child's environment, explain the benefits and encourage the parents to respond and build feedback for the benefits of the product to further increase implementation.

Some of the government programs of interest are the various compliance and workplace hygiene programs supported and funded by the Center for Disease Control (CDC), the Food and Drug Administration (FDA) and the National Center for Disease Control (NDIC). Programs such as the Health Protection Research Initiative implemented by the CDC demonstrate an invested interest by government programs in increasing the overall health of Americans.

Distribution Strategy

Our initial distribution strategy will involve a combination of distributor and direct sales. Relationships with local Northwest distributors will be established to increase promotional reach and potential users. The first orders will be available immediately through direct delivery by our executive team. Outsourcing distribution entirely in the future will allow SAFEassure, LLC to focus its efforts on marketing and expanding as quickly as possible.

Distributors will pay for the inventory up-front, and although this cuts our profit margins it helps SAFEassure, LLC to maintain a more flexible structure. By the start of 2007, distribution will be entirely outsourced  to distribution companies, and direct deliveries from the executive team will cease.

Marketing Programs

Our most important marketing program is our branding program, aimed initially at regional chain and franchise managers. This program is intended to penetrate the target markets, and establish SAFEassure's products as the soap of choice. Achievement should be measured against our projected 45% monthly sales growth rate for the first year.

Emphasizing the risks associated with hand washing non-compliance, our marketing program will employ the fear of disease, costs of illness and government regulations extensively. Written materials will convey urgency, connect users to the underlying problem and suggest SAFEassure's products as the optimal solution to the problem.<

Sales Strategy

Sales strategy will initially address local and regional managers with ordering authority for the establishments in that area. The prospective clients will be supplied with a professional product information packet and moved into the sales funnel to begin closing prospect, followed up with a direct mail brochure and a phone call.

There will be no initial direct compensation or commission for closed sales. Proceeds from sales will be invested back into developing and expanding the business. As the company begins to increase its initial sales force, commission-based incentive programs will be implemented.

Sales Forecast

  • If we are able to distribute our product through existing distributors, it will provide us a significant financial advantage, as well as the ability to meet the quick increase in demand for our product. 

  • Beginning with an initial monthly sale of $1,250 for our day care soap product (CHILDassure), we predict sales will increase by 45% per month for the first year.  We then calculate a growth rate of 90% yearly.  Cost of Goods Sold is approximately 47% of sales.  However, COGS grows at a yearly rate of 88%, which is less than the sales growth rate in order to represent the economies of scale that we hope to achieve as our operations grows.
Sales Forecast
Year 1 Year 2 Year 3
Sales
CHILDassure soap (day care) $237,168 $450,620 $856,177
HEALTHassure/FOODassure $0 $0 $0
Total Sales $237,168 $450,620 $856,177
Direct Cost of Sales Year 1 Year 2 Year 3
CHILDassure soap (day care) $94,867 $178,351 $321,031
HEALTHassure/FOODassure $0 $0 $0
Subtotal Direct Cost of Sales $94,867 $178,351 $321,031

Strategic Alliances

SAFEassure, LLC will initially encourage critical strategic alliances in two distinct areas:

Distributors

The relationship between SAFEassure, LLC and the product distributors will be essential. A flexible distribution system will be critical to the success and growth of our product. Good distribution will allow our product to satisfy and flexibly expand to accommodate demand.

The Government

By teaming up with government organizations, SAFEassure, LLC will be able to utilize existing hand washing compliance programs to reach a much larger potential audience than could be directly contacted. Government endorsement of our product, and the mention of its benefits in government brochures and written materials could be a major competitive advantage and sales opportunity for SAFEassure, LLC.

Milestones

  1. Development by the founding team of a 'rough' prototype, to be further developed by a professional by September of 2004.
  2. Attain funding to complete the testing and development of a complete and working product prototype by November of 2004.
  3. Product development is initially the responsibility of the founding team; later, we will hire a professional chemist for the final testing and completion of the product. This final prototype will be completed by February of 2005.
  4. Final safety testing of the initial product with regulatory oversight in December, January and February.
  5. After the prototype is completed in February of 2005, a patent will immediately be applied for by the founding team. Target date for patent process completion is January 2007.
  6. Promotional materials will be developed to preempt the completion of the prototype to allow for quick acceleration to market, promotional materials development will begin in November of 2004.
  7. "Phase One" marketing will include market penetration in Portland area's day care facilities. It will begin in February of 2005.
  8. After successful implementation within our primary market, we will begin the development of new products to address the hospital and restaurant markets, targeted for June of 2008.
Milestones
Milestone Start Date End Date Budget Manager Department
Develop Approximate Prototype 7/1/2004 9/1/2004 $0 Founders Product Dev.
Attain Funding 7/1/2004 11/1/2004 $0 Founders Product Dev.
Develop Final Prototype 9/1/2004 2/1/2005 $80,000 Founders Product Dev.
Safety Testing 12/1/2004 3/1/2005 $20,000 Founders Product Dev.
Begin Patent Process 12/1/2004 1/1/2007 $10,000 Founders Legal
Design Promotional Material 11/1/2004 3/1/2005 $25,000 Founders Marketing
Begin "Phase One" Marketing 4/1/2005 12/31/2006 $18,000 Founders Marketing
Begin R & D of New Products 6/1/2008 6/1/2009 $75,000 Founders R & D
Totals $228,000