Essay: Sports Galore

Executive Summary:
Detailed Business Idea:
Sports Galore looks to supply the consumers of the South Coast with quality sporting equipment, we will also supply quality clothing and shoes for example, running and casual. We will also supply different schools with equipment but terms and conditions will apply. The service at sports galore will be great and easy. My idea is to become one of the best businesses on the coast and become well known which will hopefully allow us to expand and create a franchise along the Coastal line. Our business will have a large target market.
My mission statement is to have a great distribution in sports equipment and to have a large amount of customers coming to us. I would like to have a large amount of profit and to look after all my employees and the local community.
We will not have very much competition as the only stores that sell sporting equipment along the coast is ‘lucky’s’ and ‘total sports’ and they don’t have a wide range of products. I want this business to be unique so that it will appeal to the consumers, we must be different to our competitor so we will stand out.
Goals and objectives:
We, at Sports Galore, will look to supply all upcoming sportsmen and women with the best quality equipment as to help them in trying to excel or better in their various talents. We will be giving back to the community in many ways; we will supply jobs and run workshops that will educate the communities of sport and other issues such as HIV/AIDS. I will make sure that all my employees will be involved so that I can have a good social responsibility and thereafter a good public image. We will make sure that our suppliers are environmentally friendly when creating the materials we need for our business. I would say that this business will do well economically as it is supplying goods to the community and employing suppliers. Money will come in quickly and by giving back to the community we should do very well.
Financial and technological:
I shall have available capital as I have savings in the bank and my family and friends will also supply money to start the business, I would say that about R3 000 000 will be needed. No machinery is necessary, just cash tills. Premises will be provided by my uncle who has got an area in which I can begin my work on the business.
Natural Resources:
No natural resources will be needed.
Contacts:
My family will help with the running of the store; my uncle will supply capital as well as my grandmother. Funds will be sent in to be used as capital and I will ask for sponsorships from different people and companies
Strengths
General management: I have had experience at coke so I will be able to look after the business
Financial: I will have enough capital when I begin the business
Production: No production will take place, our suppliers shall and we will make sure the deliver quality to us
Purchasing: will be done from suppliers, cheapest supplier with best quality will be used
Public Relations: will be strong because I have a strong relationship with the community.
Human resources: I will be managing, and friends and family will help. Employees will be recruited from the community
Marketing: will be done at high levels to make sure our business is known all down the coast and in Durban
Administration: will have secretaries and book keepers employed to handle all the admin. Weaknesses:
General management: I do not have any replacements that can look after the business if I go away for long
Financial: need to have money in reserve if I run low
Production: suppliers need to deliver quality, we cannot supply poor quality goods to customers
Purchasing: need value for money from our suppliers
Public Relations: Lucky’s or other competitors have a solid name, a good reputation
Human resources: we need good employees that are committed to the business and are friendly
Marketing: can be expensive
Administration: it is hard to find good staff that is capable of handling the business documents. Need to find trustworthy staff.
Opportunities
Physical: look after the environment, this will increase the public image
Economic: jobs will be supplied and I must look for a gap in the market to make a good profit
Social: workshops and programs to address social issues that are affecting the local community
Technology: look after machinery
Legal: obey and respect the law
Environment: care for the environment, allow customers to notice and will increase environmental sustainability. Threats
Physical: run out of water or electricity could damage the operations of the business
Economic: recession has hit and it will be difficult to get the business of the ground in this time
Social: HIV/AIDS as well as poverty are major social issues that can affect the business
Technology: can be expensive
Legal: new laws that are enforced may change the way we operate
Environmental: floods and natural disasters.
Human resources plan:
Organizational chart:
Responsibilities:
Sales Manager
Their job and responsibilities are to oversee the number of sales we make throughout the month; they need to see how employees conduct themselves in the workplace. They will be in charge of making sure we never run out of equipment and they need to communicate well with the Stock manager to purchase more stock.
Payment: R13 500 per month.
Marketing manager
They are in charge of the advertising and marketing of our business, they need to budget and plan the advertising campaign that will draw the consumers to our business. They must make use of any means necessary to market our business to the public. They must make sure that no bad publicity comes across our business.
Payment: R13 500 per month.
Stock manager
Their responsibilities will be to inspect and sample the stock that we get from our suppliers to make sure that the quality of the products are very good, they will also have to oversee the pricing and tagging of the products, they will also have to make orders to the suppliers on how much stock we will need at the end of every month.
Payment: R10 500.
Human resources manager
Their responsibilities include making sure that all employees are happy with the job and how they are being treated and handled. The human resource manager will also have to encourage the workers and motivate them, they will also have to make sure that customers are happy and should there be any complaints the HR manager will have to make sure that they are dealt with.
Payment: R12 500 per month.
Duties as an owner
To oversee the whole process of business, to make sure I am on the same page as all the managers in the business, I will have meetings to make sure that we are all aware of what is needed or going on in the business environment. I need to set the example to the managers and employees; I must ensure that the business runs smoothly and that there is always team spirit and good attitude towards work. Problems must always be solved in the business. A owner must be a motivator and an encourager to help motivate/encourage both the managers and the employees to work to their full potential in the business. I must react to complaints by consumers to ensure that we are seen in good light.
Duties of employees
To work hard and to their full potential at all times. To commit to the business and to always inform the management when they are not going to be present at work. To always inform the management of problems which machinery or any problems with equipment.
The employees must make a good impression on the consumer and must be helpful and cheerful. They must always be prompt to work and always give of their best. Work as hard as they are being paid for and believe in the business and never give up on it. Always stay committed.
Employees will go through training programs for a month where they will learn how things work and how to operate machinery. They will be taught what questions to ask a customer and how to be as helpful as possible. They will learn firsthand from another manager or employee so they can learn to work independently.
Payment: R5000 to R9000.
Possible suppliers
Name of supplier: Contact details: Products:
Gilbert rugby balls Tel: 0827765259
www.Gilbert.com
Durban Supply us with rugby balls we can sell to consumers and make profit.
Grays hockey sticks Tel: 0829902776
www.Grayshockey.com
Johannesburg Supply us with Hockey Sticks that we can sell to consumers and make profit.
CV’s
Wendy Lourens
Born: 2 October 1964
Age: 49
Education: Gelofte Hoerskool, studied at Durban Teachers training college
Business Experience: worked as a teacher, was an HOD, able to cope under much pressure, has been a Head of Sport.
Skills: she is persevering, hardworking, committed, flexible, organizational, not scared of conflict, good interpersonal skills and an extrovert, creative.
Harry Lourens
Born: 11 July 1964
Age: 49
Education: Escourt High School and also has studied at Durban Teachers training college.
Business experience: Have been a headmaster and various schools. Teacher at Glenwood high, also been in the construction industry and is now a pastor.
Skills: Good authority skills, can manage people and is good at solving problems, good interpersonal skills, committed, perseverance, hardworking, extrovert, creative.
Marketing Plan
Product
We will offer a wide range of sports gear, our range will not be limited and the consumer will have a wide range to choose from, the products we will sell will have good quality and they will be sold at the most competitive price. The products will range from rugby equipment, hockey equipment to tennis equipment, and all the other major sports that are played in South Africa. We will sell running shoes as well as hockey and rugby boots.
Consumers will benefit from the wide range that we offer and all the choice in certain areas that they may choose from. Our quality will be the top sports brands so consumers will benefit from our top class quality. They will also benefit from out competitive prices, they will not need a large amount of money to come and buy goods from our store. The sizes will be of a large range, we wish to sell to younger teens as well as older adults. Extra small ‘ extra extra large.
Promotion
Target market
Our target market will be very large, as a wide range of products will lead to a wide range of consumers. I think the main target market will be young sportsmen and women who need certain sporting equipment. Mostly from the ages of about 13-21 years, as this is the time when they do start to take their sport more seriously. Our customers will have a basic education as they will have purchased our goods because they will be playing school sport. Our customers will range all down the coast, from Hibberdene to Port Edward. That is our main focus.
Methods
Billboards
Flyers
Radio
Newspaper
Social work
Most people will definitely agree with opening a sports shop on the coast because it is in demand.
Advertising Campaign
Target market will be teenagers ranging from 13 years old to 25 years old. I will have to relate to them in the adverts so that they will be intrigued and want to buy from the business.
Main competitors would be lucky’s and Total Sports.
There is a demand for a business that sells quality goods on the coast, people are tired of having to drive to Durban for proper equipment.
We won’t break any laws.
We would like to get our business known to people on the coast so that people will buy from us, want a good name for our business.
Advertising, AIDA
It attracts attention and is good to look at; it contains good images and catches the eye.
It will cause an interest because most teenagers are into sport.
It will give people a desire to want what the people in the pictures have.
It will most likely lead to consumers coming in to buy from our business.
Do you love sport? And are you, at this moment, involved in playing sport? Yes No
What sport/s is you involved in or enjoy?
Is there a shop that you go to get your sports equipments, clothing on the coast? Yes No
What is the name of the business?
Do you want a business along the coast that specializes in the selling of sporting goods? Yes No
Where do you live?
Where do you purchase your sporting equipment at the moment?
Where would you want a sports store to be established, in what area?
Do you find it hard to get good quality equipment for you to play sport in? Yes No
Judging by the results of the questionnaire I would say that the people on the coast are definitely looking for a business that will provide good quality goods in sporting equipment. I will only have a few competitors and Margate will be the best place for the business to be set up.
Marketing strategy of competitors
My competitors would probably use posters etc to get hold of the consumer’s attention. But I would also say that the only reason the competitors get so many consumers is because the consumers have nowhere else to go to buy their equipment. I have asked around and there is a huge need for a business like Sports Galore on the coast.
They mostly use word of mouth to get consumers coming to buy from them but still, the consumer’s needs and wants aren’t being satisfied because their businesses have a very limited range of stock. We will learn from our competitor’s weaknesses and the consumers will soon see that our business will satisfy their needs more.
Pricing
Our business will be selling a wide range of products and equipment, so I have chosen one particular product to prove that we will make a profit.
Rugby Balls
We would like to make at least 10% margin on all the products we sell. Example, if we buy our rugby balls at R60 we will most likely sell them for R66.
If we make a deal with Gilbert and we get rugby balls for R85 per ball and we would like to make 25% per ball sold:
255 ?? R85 = R21, 25
Therefore ; R85 + R21, 25 = R106, 25
We will then be able to sell our balls at a price of R105. We will be making a profit of R20 per ball sold. A good quality rugby ball does not come cheap.
Place
Location factors
Capital: I will start a Close Corporation so that I would have help from members establishing the amount of Capital. If needed, money will be borrowed from the bank.
Competition: there are only one or two main competitors on the coast. They have established a good name on the South Coast, but they do not have a wide range of equipment. That is what will give us the upper hand.
Transport: our suppliers will not be able to be situated far from our business so that our goods can be delivered on time and with as little trouble as possible. We will also be situated close to the consumers so that they won’t have to drive too far. Employees will also need to be close to the business so that they are on time for work.
Labour: I will need workers that are dedicated and flexible. They will need to have very strong interpersonal skills.
Parking: it will be very important to have a facility with enough parking for the amount of consumers we would like to bring into our business.
Power and water: we may be dependent on power because we will have tills and machinery we use to put the prices on our products. Lighting is also important; we must be located near a power station.
Premises, Equipment, Facilities, Improvement
Location in Margate, not industrialized
Tills
Shelves
Parking
Back room for storage
Delivering dock used by suppliers
Room for customers to move freely.
Distribution channel
Goods will be manufactured at our manufacturers, they will then be sent to a retailer who will process them and then will inform us when our orders are ready. We will then get drivers to fetch our goods, they will come to our delivery dock and then they will be processed, scanned and priced, they will also be checked for areas that are not good and only then will they be put on the shelf to be sold to the consumers. A basic Distribution Channel will be used.
Financial plan
Projected Income statement for 3 months
Because we have a large variety of stock I have chosen one of our products to use as an example for the 3 months.
Gilbert rugby balls.
Items April May June Total
Sales income R20 OOO R22 000 R15 000 R57 000
Less cost of sales R8 OOO R5 000 R3 000 R16 000
GROSS PROFIT R12 000 R17 000 R12 000 R41 000
Less total expenses R5 000 R6 000 R4 000 R15 000
NET PROFIT R7 000 R11 000 R8 000 R26 000
I chose the months April, May and June because those are the months that rugby is normally played, especially at schools. There will be a demand for balls in these 3 months.
Projected Cash flow statement for 3 months
Items April May June
Cash Receipts
Current Income R20 000 R22 000 R15 000
Sales of Rugby balls R7 000 R11 000 R8 000
Other income R50 000 R25 000 R35 000
Total cash available R77 OOO R58 000 R58000
Cash payments
Purchases of stock R13500 R13500 R13500
Salaries R10500 R10500 R10500
Telephone R250 R200 R300
Electricity R150 R150 R150
Rent R1500 R1500 R1500
Wages R850 R300 R700
Furnishing R750 R0 R200
Salaries R10300 R10300 R10300
Advertising R1260 R200 R800
License R1200 R180 R0
Total cash payments R40260 R36830 R37950
Closing balance R36 740 R21 170 R20050
Breakeven point
Our total fixed cost is:
Item Cost
Stock deal every month R30 000
Total R30 000
We will sell our rugby balls at about R170 per ball.
Variable cost:
Item Costs
Transport Delivery to us- R30
Storage R20
Pricing R10
Caring for the product R10
Total R70
Break even = (fixed cost)/(unit selling price)
Break even = 30000/(170-70) = 30000/100=300
Break even = R300.
Month
Expected sales
Selling price per unit
Total Sales
April 100 R170 R17 000
May
250
R170
R42 500
June 85 R170 R14 450
Total sales turnover R73 950
The above is the sales budget for Grays Hockey sticks.
Expenditure Budget
Items January February March Total
Fixed expenses
Salaries 10500 R10500 R10500 R31500
Telephone subscription R500 R500 R500 R1500
Rent R1500 R1500 R1500 R4500
Electricity R150 R150 R150 R450
Stock deals R13500 R13500 R13500 R40500
Variable expenses
Advertising R1260 R200 R800 R2260
Licenses R1200 R180 R0 R1380
Cell phone R300 R50 R390 R740
Wages R850 R300 R700 R1850
Toiletries R250 R0 R250 R460
Furnishing R750 R0 R200 R950
Equipment R2300 R700 R0 R3000
Total monthly costs R33 060 R27 580 R28 490 R89 070
Production Plan
Machinery and equipment needed for the business:
Tills for the payments of the customers.
Shelves and storage areas.
Location.
Computers.
Manager’s office and change rooms.
Safety requirements
Hygiene- there will be ventilation, air conditioners, good lighting, and ablutions that are clean and first aid in case of any injuries.
Fire protection- there will be two exits that may be used, clearly marked. Fire escapes, firefighting equipment and the materials that are flammable will be stored in a safe place.
Machinery- safety gear will be provided and the workers will be educated well about the machinery.
Health and safety act- this will look after our workers, we will have to have cleanliness, health and safety gear, fire equipment and the employee must also look after him/herself.
Quality Control
The quality of the products that will be sold at sports galore will be influenced by the quality of the raw materials that our manufactures use as well as the labour that is used to create the product. We will make sure that a good quality product will be sold to the consumers. We will check our products so that the manufacturers will know that we want good quality and our consumers will see that we sell good quality. We will do sampling and inspections on all of our products. With our more expensive goods we will do more inspections. This will also save us having to refund the consumers because we give out poor quality.
Social responsibility plan
Stakeholders
Harry Lourens
Wendy Lourens
Community
Jayden Lourens
Hansie Lourens
Employees
Plan
We will make sure that we do not neglect the employees, community and environment jus so that we can make a profit. An advantage of us looking after the three above areas is that the consumers will notice this and this will increase our public image and relations, consumers will also see the name of our business out in the public making a difference and this will lead to publicity.
Community
The community is basically our consumers and market, if we don’t care and look after them we will lose money as no one will buy from our business. We will sponsor school sports teams that may be underprivileged and in need of certain equipment or money. We will have market days where we can encourage consumers to come join us and braai on a Saturday and watch the rugby or hockey on a big screen. We will host fun days where we will teach young sportsmen and women sport and help them enhance their skills.
Environment
It is very important for us to care for the environment. Sports galore will be going GREEN. We will not make use of any materials that have been taken from the environment and have caused problems. We will purchase products from suppliers who support our stand. We will host programs to educate the public about the effects that our actions have on the environment. We will also cut down on the pollutants that we release into the atmosphere.
Employees
We need to care for our employees because they will constantly be in contact with the consumers that come to our store. We will make sure there are programs that are set up to educate our employees about HIV/AIDS. They will be encouraged to be tested regularly and to spread the news to their families and friends. We will then look at the impact of poverty on our country and help wherever we can. We will not encourage any sort of discrimination.
Action plan
Collect the needed capital and extra money needed to open the business
Look at the questionnaires and decide on what actions to take
Purchase and furnish our premises in Margate
Phone suppliers and strike deals on the amount of stock we will receive
Meet with the financers to get the final go ahead
Carefully look for employees and managers
Get machinery needed and install in the facility
Get advertising on track
Inspect the competition, see what they have in place and try better it in our business
Set up signs directing people to the business, also hand out cards
Set up shelves in the business and put the stock that has been inspected on the shelves
Open doors and start selling
After a while we will evaluate the business and report back on how it is doing to the main board
Pay the employees and continue running the business
Contingency Plan
Micro Environment:
Our mission statement and goals must be realistic and applicable to the business. Our resources must also be looked after at all times.
Market Environment:
We must draw up a contract with our intermediaries stating that if we have any hassles or poor service we will no longer be associated with them.
Always have extra stock.
We must always be prepared for our competitors to have a new or substitute product. Once their new product appears we should have a sale that will attract customers.
We should always have a secondary supplier incase our first do not have enough stock or they are unable to deliver for certain reasons.
We must always sell our goods to consumers at a competitive price.
Macro Environment:
We must make sure that everything is working and we must always look for a gap in the market. Hold programmes that will educate employees and always look closely at new laws being passed.
Conclusion
I believe that this business will be very successful because of the great demand for sporting goods and equipment down the coast. People on the coast are tired of having to drive 2 hours to get to their nearest sports shop.
There are many of those people listed above, and due to this my business will have a larger consumer base, and my business will have very little competition from any surrounding stores. Luckys does not have a wide range of goods and they do not specialize in sporting goods.
All competing businesses that we may have down the coast have a very limited range and they usually don’t even sell equipment, they sell clothes, this will be to our advantage and people will come to our store.
We will strive to have a good public image so we will constantly have consumers walking in and out of our store. We will work to our full potential and we will always believe in our business. The south coast needs a business like this one and if we get it established, profit will take care of itself.