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.
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.
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:
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.
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:
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.
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.