AMT 2630 Mission, Aims And Values Of Unfeign Cotton Company: Business Plan Assessment Answer

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Question :

Compose a business plan on of Unfeign Cotton Company.

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Answer :

Unfeign Cotton Company 

AMT 2630 Business plan

Part 1: Business Overview

Overview

The company struggles to stay still in the merging market and place itself in the top 5 cotton companies, which will provide colossal stock that would attract customers in purchasing bulk stock. The quality of the cotton will also be exceptional in comparison to the rival companies. Being a start-up company, the struggle of sustaining in the industry's competitive environment is also a significant matter (Davidson,2013). The company fits in the geographic segmentation of the market where the product is being conducted by the company within a specific location and grabbing the local customers of the area. Initiatives of the business are naturally the internal operations that search for improving the company's working atmosphere, firm's values or total business approach (Thomas,2020).

Business description

Moreover, business culture initiatives are thoroughly secured to office enhancement initiatives since both searches for making workers feel contented and respected (Habas, 2020). Therefore, this will also help in retaining the employees of the company. The company is located in Canada. It has been almost 2½ years since 'Unfeign Cotton' has been existing in the market. Many changes have emerged in the company, starting from adapting modifications, following the customer trends, adhering to the demands of the employees, and technological advancements. 

Mission, vision, values

  • Mission statement

Unfeign Cotton Company is devoted to catering to the public's interest, fulfilling the customers' expectations and understanding their inclinations. Adapting technological and mechanical advancements to improve and make the production rapid. 

  • Vision statement

Unfeign Cotton Company have the vision of being preferred by clients because of the values and the services that the company provides and believes. 

  • Values

Unfeign Cotton Company has many values on which they swear by and believe that these values will help them progress and sustain in the industry and become the most preferred brand by the customers. 

  1. Pride must be shown in the work that is being executed by the personnel irrespective of their designation. Inculcating defined precision in the strategies, procedures and techniques adopted by the company. 
  2. Practising credo will help the employees to progress both personally and professionally. 
  3. Motivate and inspire employees for progressing and help them in rectifying their mistakes
  4. Understanding the demands of customers and make an effort to fulfil them.

Industry overview and trends

The Canadian cotton or fibre industry, with 2465 factories, is the single major customer of textiles, utilising around 40 per cent of the industry's productivity (fibre-weight corresponding). Consumers looked to keep no such view on that states whether cotton can be considered as a pioneering fabric or not. Therefore, irrespective of the fact of their age growth of the customers, they are gradually having the very least opinion and preference towards cotton and preferring linen or rayon over it (Koretz& Luiz, 2021).Yes, the current product is at risk because the preference and demands for rayon and linen fabric is gradually growing as the finish of the two fibres are satin and shiny, which is the on-going trend of the market. Not many customers have emerged in the cotton industry, but manufacturers coming into the rayon and linen industry are also threatening the cotton industry.

Technological trends

The technological changes disturb the companies' processing as the technological changes are challenging to cater to because of the extreme expenses that it barges upon, such as non-toxic FR substitute to PVC, ceramic non-ceramic (Davis, 2017). The plan that Unfeign Cotton Company has decided to execute in managing the technological disruptions is identifying the substitute ideas for introducing in the company. The customers and suppliers use a specific advanced application to locate the tracking and position of the production. 

Government regulations

Canada Consumer Product Safety Act 2010 is the existing law that has been initiated by the Canadian Government to know to make the productsafe and good to use for the customers(Justice, 2021). There have no such new initiatives taken by the legal bodies that have impacted the company.

The market

Overview of market trends

The group of customers that are being served are the producers who purchase fibres and then use them for producing clothes and cotton masks, and bags. The size of the customers is not as massive as the company is a start-up. It is gradually growing, and the customer base is also increasing (IC,2021). The customer behaviour has been changing over time as the preference for cotton is declining and demands for rayon and linen is gradually increasing. The supply is slowly evolving, and inventory management is expanding. 

Target market

The ideal customer can be considered as the ones who are the producers and purchasing the fibres for producing clothes and other products; therefore, these customers have the potential of buying raw materials in bulk quantity as they require it for their production. There has been a remarkable change in the preference of the customers as they demand rayon and linen more than cotton. 

Products and services

The product that currently Unfeign Cotton Company is selling is raw cotton that has the best quality. Also, there is a variation of poly-cotton where the price and quality also differs. The products and services fit well in the market, yet the strategies require to be very competitive to sustain in the industry. 

The competition

Competitors and type of competition 

The direct competitors in the Canadian Market are Cotton and Company, Zinman Textiles, KenDor Textiles Ltd. All of the following competitors' deals in selling similar products and services to customers make the market more competitive. Silk fabric, the Fabric Room are the indirect competitors belonging form the silk industry (Mokyr, 2020). 

Competitors’ strengths and weaknesses

When competitors can be vulnerable, it will be when a start-up company like Unfeign Cotton Company is attracting the customers of the giant players through the competitive pricing strategy. When Unfeign Cotton Company is offering less price for better quality and the treatment towards the customers and favouring their orders and demands as priority will attract customers and grow their business, the competitors will make them vulnerable. The activity that they are doing very successfully is that they have included the global market and expanded their client base to a more significant extent (Geloso, 2020). 

Competitive advantage and differentiator

The one aspect that would make customers get attracted towards Unfeign Cotton Company compared to the other existing giant players are the premium quality of cotton with comparatively less price and the discounts on bulk purchasing. The one thing that makes Unfeign Cotton Company’s products different from its competitors is that the finishing of the cotton would be both matte and shiny. There will be many colour options for the customers without compromising on the quality. Unfeign Cotton Company has adopted an innovative way of distributing products through wholesaling, direct selling, and retailing. The customers also are given many discounts and comparative less price for purchasing the products. 

Start-up costs

Items to be purchased
 
Funding for each item to be purchased will come from:
 

Items
Cost
Loan
Uncle Bob
Total Funding
Notes

 
(Amount in $)
 

Land
3500
3050
550
 8000
 

Tractor
2000
1000
1000
 8000
 

Agriculture
400
150
250
 8000
 

Cotton Gin
300
300
 
 8000
 

Spinning Machinery
250
250
 
 8000
 

Looms
150
150
 
 8000
 

Knitting Machinery
300
200
100
 8000
 

Dyeing Machinery
350
250
100
8000
 

Finishing Machinery
350
250
100
 8000
 

Operations
400
100
300
 8000
 

Total
8000
5700
2400
8000
 








Part 2: Sales and Marketing

Customers

The key customers are producers, manufactures and retailers of producing clothes and selling raw materials. The business of Unfeign Cotton Company is entirely reliant on primary customers as they purchase bulk orders. The customers base is gradually diversifying of Unfeign Cotton Company. 

Sl. No
Name
Address
Terms
Products/services
1
Customer 1
Drowning hill street 117 pin: K1A0B1
10% advance for 1 kg of cotton order
Raw Cotton
2
Customer 2
Hanging lane 117 hooks: K1AB10
10% discount on dyed cotton and natural cotton up to 3kgs
Dyed cotton 
3
Customer 3
Barging street 117 pin: K1A0B5
20% on dyed cotton and natural cotton upto 5kgs
Dyed Cotton

Suppliers

The key suppliers are machinery suppliers, delivery agents and wholesalers that are involved in raw materials. The commercial of Unfeign Cotton Company is entirely reliant on primary suppliers as they deliver bulk orders. The supplier base is gradually diversifying of Unfeign Cotton Company. 

Sl. No
Name
Address
Terms
Products/services
1
Supplier 1
Waterloo street no. 14 pins: K1A4B1
Pre-payment for a delivery finished product
Finished product
2
Supplier 2
Morrisville street no. 7 K1A015
Pre-payment for machinery supply
Machinery
3
Supplier 3
Richardson Street no. 19 K1A013
40% payment for distribution 
Semi-finished products

Advertising and promotion

Unfeign Cotton Company is practising strategic advertising policies and campaigns that showcase their quality and affordable price ranges. The technology adopted is digital technology, and the marketing department is present in Unfeign Cotton Company to support its advertising campaigns and strategies. 

Pricing and distribution

The services and the price of the products are done based on the inventory, production, electricity and cotton plantation charges, including the tax and 5% of the profit margin (Ricciardelli& Power,2020). The delivery of the finished product is done through various distribution channels such as wholesaling, even though delivery agents.

Customer service policy and warranties

Unfeign Cotton Company's guarantee is mainly related to their colour fading, fine finishing, and shiny texture. The warranty period is for three years. Unfeign Cotton Company have a warehouse where they store their surplus production whenever the client requires products the demands are fulfilled by despatching products from the warehouse. 

Part 3: Operating plan

Business location

The Unfeign Cotton Company's business location is welling street, pin K1A020, the hours of operation is 8 hours and hours of production is 10 hours. The site is also practical as the area is widespread and the epicentre of raw materials. The land is taken on rent, and there are mortgages. The terms for land rent were 30% of the amount in advance and rent payment within the 5th of every month.

Equipment

The equipment relied on while conducting business is cotton gin, knitting, spinning, dyeing and finishing machinery, and looms. Replacing the existing machinery has to be done because of the evolving technological change.

Technology requirements and investment needs

The purchasing of new technology has to be done to sustain itself in the competitive market. The anticipated cost for advanced technology is $ 150. The monitoring and maintained cost would require $50.

Environmental compliance

According to the Environmental Act, the Unfeign Cotton Company needs to adhere to the guidelines that do not pollute the water bodies and air and ensure and maintain eco-friendly products. International Environmental Law (IEL) National Environmental Law (NEL) has severe impacts on the processing of the company (Steward, 2020).

Part 4: People

Description of the management team

The marketing department looks after the advertising and promotional activities of Unfeign Cotton Company. The HR team looks after recruiting the employees, and the R&D department looks after researching and identifying the trends of the company (Vanos,Vecellio& Kjellstrom, 2019). 

Description of the advisory team

Unfeign Cotton Company has accountants and external sales representatives who look after their production and help them initiate a budget for eradicating unnecessary expenses (Covernton et al. 2020). 

Key employees

Yes, the non-managerial employees are vital for the business; the production manager's absence significantly hampers the processing of the company (Ducas& Wilner, 2017). The inadequate functioning of the production team hinders the whole procedure of the company and affects the revenue structure. 

Sl. no
Name or title
Key responsibilities
qualifications
1
Production manager
Monitoring production process
Min exp. of 4 years
2
Marketing manager
Executing marketing activities
Min. exp. of 2 years
3
HR manager
Recruiting potential candidates
Min. exp. of 2 years.

Part 5 - Action plan

Project objectives

Unfeign Cotton Company aims to help the community and provide opportunities to the workers within the company to enhance their skillsets by learning new procedures. The completion date is 30 August 2023.

Resources required

The hiring of new and skilled employees is highly required, and $8000 is needed to accomplish it. The amount that is being financed is almost $2400, and new equipment will be required to adhere to the following projects 

Sl. No
Actions
Key Milestones
Person accountable
1
Improving production and increasing stock
Ample stock will be produced to cater to more clients
Production Head
2
Hiring employees for production procedures
Augmenting production process
HR manager
3
Initiating marketing promotional activities.
Making clients aware of the company's offers
Marketing head.


Risk assessment and contingencies

The employees are leaders that the Unfeign Cotton Company have are not as skilled as they should be to augment production. The sudden climatic changes and fluctuation in the tax rates can be impactful for the Unfeign Cotton Company’s business. The sudden climatic change can bring delay in delivery (Whitton et al. 2018). Plan B is to recruit employees on a part-time basis to improve production and select the best productive employees and make them permanent (Ic.gc.ca, 2017). 

Part 6 - Cash Flow and Financial Information

Cash Flow objectives

Cash Flow Statement for the year ended 31 March 2021






 



 






 
 
 
 
Current year
3 Years
 

 
 
 
 
 
Amt(Rs)
 
 
 











A. 
Free Cash Flow









Net Income



   4,000.00 
 12,000.00 




Add: Depreciation & Amortization



      680.00 
   2,040.00 

 






   4,680.00 
 14,040.00 




Less: Change in Working capital



   1,250.00 
   3,750.00 








   3,430.00 
 10,290.00 




Less: Capital Expenditure



   1,200.00 
   3,600.00 








   2,230.00 
   6,690.00 













Financial Information

The machinery that Unfeign Cotton Companywould require is cotton gin, knitting, spinning, dyeing and finishing machinery along with looms. 30% of the total amount of $8000 is being funded by Uncle Bob that $ 2400, and the rest $5700 is being taken on loan. 

Land
Tractor
Agriculture
Cotton Gin
Spinning Machinery
Looms
Knitting Machinery
Dyeing Machinery
Finishing Machinery
Operations

These are the essential items that are being taken by the company for executing their production procedures. 

Part 7 - Executive summary

Farm objectives

Unfeign Cotton Company aims to help the communal and provide chances to the workers within the corporation to improve their skill sets by learning new procedures. 30 August 2023.

Farm description

The solutions provided to the customers will be more focused on their demands, and the competitive prices offered by the rival companies will be looked at so that the demand and inclination can be forecasted (Thomas, Pidgeon& Bradshaw, 2018). The preferences of linen and rayon are also stimulating that need to be catered through massive production of authentic cotton.

Products and services

The products and services fit well in the market, yet the strategies require to be very competitive to sustain in the industry (Jordan et al. 2019). The current product is the only cotton and dyed cotton. 60% of the revenue is obtained from bulk selling of the products and less than 40% from wholesaling.

Financing need

The current sales are $2000, money that is required for the project is almost $ 4000; the investment of the funds will be made on purchasing new machinery, team and advanced technologies.