Poseidon: A Business Plan for a Sustainable Shower Head, Assignments of Business and Labour Law

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B U S I N E S S P L A N

Table of Contents

• Executive Summary
• Business Rationale - Customer Empathy - Problem Statement - Solution Statement - Company Goals
• About The Business - Company Overview - Mission Statement - Organization - SWOT Analysis
• External Environment - Competitive Analysis - Current Economic Environment - Industry Analysis
• Marketing Plan - Target Market - Marketing Mix - Discussion of Business Risks
• Financial Planning - Break-Even Analysis - Balance Sheet - Summary Loss and Profit Statement - Sales Projection Summary - Financial Statement and Charts - Financial Write-Up
  • Appendix

While the financial incentive and luxury of the Trident appeals to a wide market, we specifically aim to market the environmental improvements that our product brings to the younger generations: Generation Y (Millennials) and Generation Z. To successfully advertise to these tech savvy consumers, we have decided to focus our marketing efforts heavily on social media. Poseidon is being heavily promoted on Instagram and TikTok, with an emphasis on Instagram. So far, our marketing tactics have been very effective, as we have more followers than any other VE Instagram account. We have achieved this success through strategic and focused marketing. Poseidon also holds raffles to further establish our brand and mission through social media. This is a pivotal asset to any business because social media can be the deciding factor when determining what product to buy, and it provides Poseidon with an easy way to reach an audience. For Halloween, we hosted a candy giveaway where people were required to follow us and tag three other friends. During the November trade show, we raffled a $50 Amazon gift card to attract customers, which contributed to our sales. Our efforts so far have proven great success. Our profits have been consistently increasing, placing Poseidon in a strong and secure financial position as we continue to flourish and increase revenue. Poseidon’s competitors, in both the real and virtual world, have vast differences from the product that we provide. Companies with similar products are either poorly established in the United States or limited in their design. This leaves Poseidon’s Trident shower head as a highly desirable branded product. According to a study conducted by Global Info Research, the shower head market is expected to grow from 3. Billion USD in 2019 to 4.2 Billion USD by 2025. We are well positioned in a growing market to greatly succeed, allowing us to develop a global brand and further establish customer loyalty. Poseidon started with the financial support of three generous angel investors, and have since proven our ability to independently succeed. This is a result of our 64% profit margin , with an average selling price of $125, and our effective sales techniques. We designed and custom coded a program that we used to reach out to Virtual Enterprise companies all over the world to promote our product. So far, we’ve been able to contact over 3000 companies in 24 different countries in their own languages and we will continue these efforts elsewhere. Through this, we have proven ourselves to be extremely competitive and vastly successful. As Poseidon continues to grow, we see profitability on the horizon. Based on our calculations Poseidon’s break even in sales dollars is $807,000 , and our break even number of units sold is 6,456. While these numbers may seem high, we continue to expand and grow our sales, as well as expect to increase our profit margin. Our primary cost is salaries, with a cost of $437,500 per year before taxes, but overall our current monthly expenses are $72,085.. We project our sales to increase month on month and expect great increases for months that have trade shows. Looking forward, we hope to continue to innovate on our product, establish our brand, and solidify our international presence.

Executive Summary

Homeowners, landlords, hotels who want to decrease their bills. They would be willing to invest in a new shower head if it meant saving money and helping a good cause. Contractors often play a pivotal role in a homeowner's decision to purchase a shower head. 61% of US homeowners have begun home improvement projects since March of 2020, meaning that the impact of a contractor is higher than ever. and thus the impact of contractors is higher than ever. Generation Z and Millennials because are likely to take eco friendly purchases into consideration. In fact, 73% of Generation Z and 68% of Generation Y said that they would be willing to pay more for eco friendly or sustainable products.

Customer Empathy

Our marketing research team was able to discover three main areas where our Trident shower head would be the optimal product. Problem Statement Water is increasingly becoming more expensive in first world countries and has cleanliness issues around the globe due to scarcity of fresh water in many areas. The state of Texas is a perfect example of this; between 2008 and 2018, water bills in San Antonio have risen 154% , and over 14 million Texans went without clean water during the February Winter storm. As water is a finite resource, problems like these will only continue to occur and in much larger magnitudes. However, with products and innovation such as the Trident Shower Head, we will be able to combat these crises head on. Solution Statement We solve this problem through our technologically advanced Trident shower head. The Trident greatly reduces water usage without impacting the comfort of the user. It achieves a 24% reduction in water usage through the revolutionary, and relatively untapped, water aeration technology. This provides customers with a simple solution which they can use every day to help save money, water, and the environment. Company Goals We are looking to expand our product line and overall sales by creating another shower head that can be sold at a lesser price. While the exact details of this product are still being developed, we insist that the fundamentals of our company's mission be maintained. This product should, in theory, greatly increase our TAM (total addressable market) and enable us to further establish our company as a staple in the market and into the average household. With further development to our product line and increase in sales, we will be able to advance our company's purpose: To be part of the international push towards greener solutions and a more sustainable future. We will spearhead the change necessary to save water, energy, and our customers' money.

Bussiness Rationale

SWOT Analysis

About The Business

Competitive Analysis The current developments in the shower head and water device industry have seen limited but relevant competition. However, these innovations in technology are limited only to faucets in a domain of recognizable brands such as Delta, Brizo, and Moen. Poseidon has gained a substantial lead in the race against these brands through innovation in the Trident line of shower heads and having the ability to provide the idealistic demands from the array of demographics in the target market. Poseidon’s technologically advanced product has advantages over any possible competition. Brands such as Delta and Moen feature relatively cheaper but lesser quality products - some of which are made entirely from plastic. Despite being inferior, these products from competitors are capable of ranging from 50 USD all the way to 350 USD. This allows Poseidon to be able to continue brand development recognition with a superior crafted product at a competitive and often preferable price point. Poseidon heavily emphasizes the ability of our product to provide the build quality and performance of luxury brands for a fraction of the price. Luxury brands such as Brizo charge up to 700 USD for their products which provide features that are trivial such as motion sensors. However, the Trident shower head provides features such as water monitoring, which serves a purpose for a consumer and their need to save money and water. Current Economic Conditions The United States has experienced a growth in GDP at an annual rate of 4.1% in the fourth quarter of 2020. The U.S. unemployment rate is at 6.2% and the inflation rate is at 1.4%. As this inflation rate is forecasted to remain low, Americans will be incentivized to spend their money and take out loans, often for renovation projects. The GDP value of the United States has been on an upward trend relative to its fall during the pandemic. This increase allows consumers to spend more on luxury products like the Trident shower head. Nationwide, the average water bill has risen 80% in the last decade, with increases of over 154% in some major cities. Similarly, oil prices are up 70% since November, a record for the modern era that is resulting in a staggering increase in heating bills. The shower head market is expected to continue to grow at a compound annual growth rate of 3.9% between 2020 and 2025. The shower head market was worth 3599.5 million in 2019 and is expected to reach 4198.6 million in 2025. This extreme growth and ideal economic circumstance just further indicates that now is an opportune time for Poseidon to penetrate the market and expand exceptionally as a company.

External Environment

Marketing Mix

Product

Poseidon’s Trident shower head is a high quality necessity that is designed to reduce water usage and

provide the consumer with invaluable information about their showering habits and water usage. This

information can easily be located on the Poseidon app, which is free to download on all smartphones.

Self powered through a hydro generator, the Trident is self sustaining and requires very little

maintenance, a quality that can also be attributed to its silicon jet cleaning nozzles.

Price

Our average shower head is sold for $124.99 with a $10 flat delivery fee and a 7% tax. We are able to produce our shower heads for $44.99 on average, meaning that we have a 64% profit margin.

Placement

Our product’s initial placement was on our own website as it allowed for the easiest way to. sell directly to customers without much cost. This website was hand designed and coded. from scratch to exemplify the professionalism of our company. In the future we plan on. expanding into home improvement stores and purchasing middle shelf placement, as well as.. advertisements in these stores, to promote our product to both contractors and home improvers.

Promotion

Poseidon is being heavily promoted on Instagram and TikTok. Our main social media app is Instagram. Poseidon is the most followed account on Instagram, surpassing all VE firms due to our target marketing skills and our connection with our customers. We hold raffles and other user-interactive activities to continue to brand ourselves and subject our company to potential buyers. During the Halloween season, followers on our Instagram account needed to tag three other users to be entered into a giveaway. This continued to expose our company to a variety of people fighting our target market. It has resulted in an immense amount of followers and further our connection to new firms and companies. During the November regional trade show, our firm raffled off a $50 Amazon gift card , and it yielded astounding results. With our immense amount of profits being made, Poseidon is giving back to water.org, an organization that’s mission is to deliver purified water to communities where safe water is a scarce commodity. With such similar goals to save Earth’s limited water resources, our company felt it was crucial to donate 10% of all profits to Water.org.

Marketing Plan

Discussion of Business Risks The staff at Poseidon has identified several risks in our company and as a result, has carefully determined separate business strategies in order to address them

Marketing Plan

Financial Planning

Balance Sheet Our balance consists of our total assets as a company. By calculating our current assets (cash and supplies), it was determined that we have $642,176. We have $8,277 in fixed assets, which are made up of computers, furniture, and other office equipment. This adds up to $650,653 in total assets. Our total current liabilities, which includes salaries, payroll tax, and sales tax, accumulates to $148,230.38 , leaving our stockholders with $502,422.62 in total equity.

Summary Profit & Loss Statement The gross profit before any expenses can be determined by subtracting the cost of goods sold from the total sales revenue. Then, we were able to calculate the total projected revenue by using the numbers from the sales projection as well as our actuals. After calculating variable costs, total fixed cost, and sales and payroll taxes, our determined monthly operating expenses come out to $71,710. Additionally, after subtracting the total loss from our gross profit, our net gain through the month of February was determined to be $421,815. This shows that our gain is greater than our loss, indicating that our company is growing at a healthy rate, as well as quickly moving towards our break even point.

Financial Planning

Sales Projection Summary March/April: As previously stated, every goal set by the Poseidon executives has not only been met, but has been exceeded in grand fashion. This makes it difficult to assign a number for the monthly sales projections of the next two months. There is another national trade show in March, and then an international fair in April. As the team gains experience, it is only fair to project significant increases in sales revenue. For this reason, Poseidon is currently projected to make a total of $456,099 in March, and then hit half a million dollars in April alone at $501,709. The company is in an ideal position to expand internationally and soar financially over the coming months and years. Financial Write-up The manufacturing of our shower head currently costs $45 , while our we are making $125 per sale. This results in an astounding 64% profit margin. We believe that this margin is not only sustainable, but can be expanded upon. As we expand our company, we will have more purchasing power, allowing us to buy materials and manufacture our products at lower prices. The estimated break even point comes at $807,060 and 6,456 units sold. The company is hastily approaching this point, as shattered sales projections have caused our initial estimated break even date of February 2022 to be moved up, which is now April of this year. From November to February, the company made $109,212 in sales excluding the three trade shows. Expecting steady growth, this translates to an 8-month estimation of $235,555 through the end of April. The company is partaking in a total of 6 trade shows this fiscal year, and the estimated revenue from such events is $1,776,961. It is realistic to expect our monthly growth to remain high. This can be attributed to our easy to use website as well as the aggressive tactics of our sales team. In sum, trade show revenue will account for nearly 80% of our sales revenue this year (excluding donations and investments). All together, Poseidon is projected to make $2,002, in sales through this April. Thanks to these profits, the company is in fact predicted to break even in April of this year. Poseidon is very fortunate to have been aided in the process of getting off the ground. The generous investments of our 3 angel investors, Marc Desalvo, Lorraine Bowman, and Greg Meservy, amounted to $150,000 , in addition to our seed money of $20,000. Poseidon has a bright future ahead thanks to the efforts of everyone involved in the company, and we are in a fantastic financial position to continue to expand worldwide.

Financial Planning

Office, U.S. Government Accountability. Freshwater: Supply Concerns Continue, and Uncertainties Complicate Planning, 27 May 2014, www.gao.gov/products/gao-14-430. “Global Shower Heads Market 2020 by Manufacturers, Regions, Type and Application, Forecast to 2025.” Global Shower Heads Market Size, Forecast Report 2025, www.decisiondatabases.com/ip/12544-shower-heads-industry-market-report. “Reduce Hot Water Use for Energy Savings.” Energy.gov, www.energy.gov/energysaver/water- heating/reduce-hot-water-use-energy-savings. “Oil Prices up Nearly 70 Percent since the Election, a Record in the Modern Era.” WRCBtv.com | Chattanooga News, Weather & Sports, www.wrcbtv.com/story/43419615/oil-prices-up- nearly-70-percent-since-the-election-a-record-in-the-modern-era. “Independent Review: 30 Hours of Research to Find the Best Water Saving Shower Heads Money Can Buy.” One Community, 6 Oct. 2020, www.onecommunityglobal.org/water-saving- shower-heads/. “Showerhead Microbiome Project.” Public Science Lab, 28 Mar. 2019, robdunnlab.com/projects/showerheads/. “Showerheads .” EPA, Environmental Protection Agency, 25 Sept. 2020, www.epa.gov/watersense/showerheads. “Low-Flow Showerhead Benefits.” HGTV, www.hgtv.com/design/remodel/bathroom- remodel/low-flow-shower-head-benefits.

Appendix: Sources

Appendix: Algorithm

Appendix: Angel Investor