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Description

Blowarcade Heels “Doctor”
Market Analysis
Blowarcade Heels “Doctor” operates in a service cum production industry.
Our business is located in a buzzing working environment. Canada, and in our case Vancouver, presents one of the most vibrant economies in the world. The working class provides a perfect market for our services with the ready clientele. The central strategic placement of our business brings our products to the people at their convenience. Our client base is defined by the working population in the several offices and other business premises around us. Our location gives us easy access to all the working-class ladies and business operating ladies in the city. Besides the city population, we also hope to enjoy doing business with the occasional visitors in the city and even people living in the outskirts of the city.
Heels pronounce independence of a woman, not only do heels but lady shoes. The “power of the shoe” as many people would prefer to refer to it Classy and formal shoes confer status and certainly have an aura about them. Heels are indeed, however, a comfortable shoe is also of great essence, and this is where heels removal comes in. Flat shoes provide quite comfort in cases where someone must do some walking and resultant movement from one area to the other. Bearing this in mind, we decided to set up our business. Our objective is to provide comfort while at the same time maintaining the classy look.
Getting clients to subscribe and remain loyal to your brand in the wake of the ever-rising competition can present a challenge to many businesses. In our set up however, we plan to thrive by making sure we offer the best qualities and provide the best services the industry has ever experienced. When dealing with ladies, it is important to first recognize their preferences and pay attention to all details. There are basic principal factors that all heel removal and repair clients consider before subscribing to any dealer’s services such as; efficiency, quality of work done, the environment exposed to, and the rapport created between the business and the clients by the employees.  To address such, we have spent enough time and resources to make sure we meet our customers’ expectations. Removal of heels without distorting the value of the shoe can be quite a task to many. Our workers have topnotch training, creativity and working experience which makes them provide superior service to our competitors. Our repairs are basically tailor-made to suit each client’s desire. As a business, we value our clients and strive to provide value for their money. We give a listening ear as well as discussing the various design options before embarking on our work. By the virtue of being our clients, you not only enjoy our paid products but also get access to the trending news on shoes and the requisite advice on designs free of charge. We will also do deliveries and collections for our loyal customers. With everything set in place, we aim to have tones of hundreds of ladies on the waiting lists for their shoes to be worked on by our staff albeit the many other similar businesses around and this can only happen if our product reputation precedes us out there.
In our line of operations, we recognize and appreciate the existence of our competitors. The heels removal business has in the recent past attracted a lot of players due to the trending flat shoe galore. The main competitors who have been in the business before us include; Max’s shoe repair, Bytown shoe repair and MERHI quality shoe repair among many others. Most of our competitors while they offer similar services, some of them are overpriced. The new guys in the industry charge very low prices to gain clients. Flat shoes are considered comfortable while at the same time maintaining class. In the last two years for instance, in this central business district alone we have witnessed a 76% increase in the number of players in this industry. The robust encroachment of these businesses has seen a stiff competition crisis for clients. We have come up with certain customer appreciation programs such as giving gift hampers, offering discounts among others. These programs will not only to maintain the customer’s loyalty to our products but will also serve to make them aware of how much we appreciate their engagement with us. Besides selling and repairing, we will also offer add-on services such as cleaning the shoes, applying dye if necessary among other services as part of customer loyalty campaigns. We also carry out Community Social Responsibility in the surrounding society which also couples as our meet the people program. During these events, we offer apprenticeship programs to those aspiring to join the industry.
Our market is divided into four segments; the Eastern, the Western, the Northern and the Southern part of the town. With the entrance of many players in the industry, we expect the market will be quite competitive. While we believe that heel removal is a strong business, we plan to explore other business expansion options but still strictly in the shoe industry. This would as a result, add some spice to our already cooking soup and eventually, a reflective increase in clientele.
In our projections, we target to attend to approximately 300 customers a day. Considering that we open on weekdays alone, which translate to around 7,500 customers per month. We have currently identified some marketing strategies which once implemented, will help us achieve a 15% increase in clients. While the shoe manufacturing industry is crowded, we hope to convert our current heel removal and shoe repair clients to our brand subscribers and even ambassadors. Eventually, we should be able to command a larger customer base due to the vast options we will be able to provide and as a result, enjoy an increased income.

References
https://www.google.com/patents/US20110197474
https://docs.google.com/viewer?url=patentimages.storage.googleapis.com/pdfs/US8112906.pdf

 

 

Statistics

 

EQUIPMENTS
Shoe making Shoe sole Shoe box Injection Heel Maker
42,500 19,500 25,000 25,000 8,580
47,000 29,000 10,000 35,000 9,400
$43,000 20,000 20,000 43,000 30,000
$21,000 45,000 32,000 25,000 35,000
$79,000 38,000 42,000 16,900 15,800
22,000 100,000 135,000 22,000 25,800
16,700 50,000 35,000 6,900
22,000 30,000 40,000 9,900
20,000 40,000 24,000
30,000 55,000
39,500 58,000
50,000 79,000
150,000 35,000
52,000 26,000
$13,000 27,300
210,000 45,000
230,000 80,000
80,000
Average 36,650 41,917 66,971 42,622 18,376
Cost in CAD $45,783.89 $52,363.52 $83,661.46 $53,244.22 $22,955.65
Total Cost $258,008.74  

COMPANY’S NAME

                                    BALANCE SHEET

DATE

 
Current Assets
Cash $200,000
Accounts Receivable
Invneotry
Prepaid Insurance 54,660
Property, Plant, and Equipment
Buildings 1,100,000
Equipments 258,008.74
Goodwill
Total Assets  

9) Production / Operations plan (Derrick)

Raw material (Lambskin)

Our high-heel shoes are made of high quality lambskin, the leather’s feather is soft, good look, and not expensive. Color of Lambskin leather is diversity; we provide colors ranging from pink to black, even shades of gold and bronze. Therefore, our company satisfies customers different needs. The cost of lambskin is $6.588 per pair of shoes.

(BUSKSKIN LEATHER COMPANY, 2017)

 

Component of per pair of shoes

Our components of high-heeled shoes consist of heel tips, shoes tack nails, soles, glue, shanks, sewing thread, and insole lining. We choose these components come from high quality suppliers in order to our products have durable feature. The cost of heel tips is $0.625 ($4.13/ 60 pieces=$0.625) per pair of shoes (ebay, 2017); the cost of insole lining is $0.1 per pair of shoes ( (Alibaba, 2017); The cost of sole is 0.103 ($3/(10000 / (24.5*7))=$0.0514*2= $0.103) per pair of shoes (Alibaba, 2017); the cost of glues is $0.0162 (US$8.1*1.25/1000 kilogram*2 =$0.0162 CAD) (Alibaba, 2017); the cost of tack nails is $0.0125 (US$500*1.25/500kilogram*10=$ 0,0125 CAD) per pair of shoes (Alibaba, 2017). The cost of heel is $0.625 per pair of shoes (Alibaba, 2017). The total variable cost per pair of shoes is $36.46(see more information on exhibit)

 

(How products are Made, 2017)

Manufacturing process

There are total seven process from raw material to complete high-heeled shoes, first step is delivery material to out plant, then labours to distribute raw material to product line, second step, labours tailor leather different size to produce shoes. Third step, sewing operators sew pieces of leather to together. Fourth step, operators put heels attach to the sole by nails, and covered it with glues. Fifth step. Labours put all complete shoes to inventory location in order to dry. Sixth step, Inventories would be checked quality by inspectors. Final step, we deliver our high-heeled shoes to our customers.

 

(How Products are Made, 2017)

 

Quality control

Our purpose to provide high satisfactory high-heeled shoes to our customers. Our company increased profit by improving quality of products. we achieved total quality management by the four flow of activities, such as organizational training, quality principles, employee empowerment and customer feedback. We train employees before they produce shoes; We empower our employees in every step of production process, and encourage employees have we build labour network to communication efficiency, we move responsibility from supervisors to employees to solve quality problem. we through customers’ feedback and adjust quality process aim to win more faithful customers.

 

Inventory management

Our company had prepared Just-in-time system to reduce our inventory cost. Our total four type of inventory includes raw material inventory, work-in-process inventory, operating supply inventory and finished- goods inventory. Our most of components of shoes come from oversea suppliers. Therefore, inventory record accuracy is very important for our business. Our company separates import with domestic components. Import components of shoes, we order to amount can produce high-heeled shoes during three month, because shipping cost and time cost is large cost for our business. We found leather material supplier come from Calgary,so we can order lambskin leather per month.

 

Fixed cost

The total fixed cost is $75,855 per month, include depreciation–building is $3,325 per month, depreciation-machinery is $71.45, two manager salary is $14,080 per month, utilities cost is $27,831, Insurance cost is 64 per month, and loan $75,855. (See more information on financial part or exhibits)

 

Plant Location

Our company spend $ 2,109,555 to buy factory in the Langley. The location address is 5525- 272nd St (Beedie, 2017). Langley. BC. There are four factors that we decide to buy factory but not lease. Firstly, our business is long-term business, we want to reduce the fixed cost. Secondly, we compare with other location price, and size of industrial plant, our unit size is 11,403 SQFT and total building size is 54,367 SQFT. Thirdly, there are three main functions in our plant, include Factory, warehouse, and office.

There are total 10 new sewing machines which cost is $6,859.5 in our factory, machines can use 8 years, and no salvage value. Other capacity cost and useful life we discuss on financial section.

 

Layout of factory:

Components

Of shoes

Raw material Work-process-material
Office
Factory
Retail
Inspection

Area

Finished product
 

 

Location:

(Pachal, 2013)

Proximity

Our company focus on high quality of products to supply customers who live on Great Vancouver, we choose our suppliers as nearly as possible our location, therefore, we can control and adjust the quantity of lambskin leather.

 

Labour

In our company, there are twenty employees and four managers, our labours most have sewing skill, they will Clip and sew material with machines. We need one sales manager and two operating managers who are experienced. They also need have strong communication and control capacity to ensure operating efficiently. Our total employees’ wage is $15 per pair of shoes. the average salary of four managers is $14,080 per month. Our company will corporate with some financial analysts to make business strategy. We provide 2% of employees’ benefit that total cost is $64 per month.

 

Organization

There are four partners in organization, we are control the company together, the advantage of partnership is making decision together, partners shared responsibility and risk in organization. We can reduce the cost through partnership, because our partners share profits.  The disadvantage of partnership is spending high cost on time, because we spend more time to make a decision than sole proprietor, all partners have unlimited liability, may occur abuse partner’s power in our organization.

 

Risk Analysis

Market

We will adjust our marketing strategy when we have issue about sales, we collect our customers’ feedback, then make a new sales plan and promotion for customers, also we redesign our product to meet our customer’s wants and needs. our target market is broadly which customers’ age from 25- 45 years old.

 

Competitive

The competitors will occur when new products develop into market in short time, we increase our competitiveness of products through high quality goods and service to attract our customers. In this period, we make a short-term and long-term strategy.

For short-term, we provide high quality goods and services. For long-term, we build benchmark and famous brand in high-heeled shoes