Thesis (MBA (Business Management))--University of Stellenbosch, 2009. / ENGLISH ABSTRACT: A Document Management System (DMS) can help businesses speed-up as well as
reduce the number of mundane and repetitive tasks relating to documents. These benefits can assist management cut costs, reduce errors, automate frequently performed tasks as well as store information electronically in a safe and accessible way. Making IT Simple (the business) is a start-up business that has entered into a partnership agreement with INVU, Europe's fastest growing DMS Software developer (INVU, 2008). This agreement allows the business to sell INVU software without restriction by volume or
geography to all sectors of industry. INVU products are designed to make business administration, and especially managing documents a simple and efficient process. These two principle product features support the business' objectives and marketing push by delivering easy-to-use software that helps
customers reduce costs by speeding-up as well as reduce the number of daily
administrative tasks performed using documents.
In order to establish which market sector to target, the Directors conducted an industry analysis (Appendix I) which has identified opportunities in the farming and agricultural Sector. The three primary reasons are: 1) Sustainable sector growth of 30% per annum (UK Agriculture, 2007), 2) no known DMS competition within Farming and 3) the Directors have an established Network and detailed knowledge of the sector. Although farming and agriculture will be the main focus of marketing activity and communication, other industries, such as property letting agencies, are also seen as future opportunities for the business. Target Market and Projections
Market Research is based upon 138 questionnaire responses that have enabled the Directors to develop a product package which combines the product, a DMS license and software, together with the necessary hardware and maintenance support sufficient to satisfy the target market's needs. The target market is defined as a farm business, predominantly farming crops or cattle and/or sheep from between 41 and 80 hectares of productive land. It has up to 20 full time employees, half of whom are involved in the business' administration. This admin comprises mainly of financial accounts and Government Department returns which are processed on as many as two computers which have email, Microsoft Office and accounting software packages loaded on. For security and access the target market store their records in filing cabinets for up to 15 years, mostly in paper form. A priority for business' administration within this market is the simplicity and easy access of its records and with all records being in one place. The sales forecasts of 7, 16 and 30 units over the first three years 2009, 2010 and 2011 respectively are deemed achievable by the Directors, having received reassurance from both formal interviews (Radley, 2008) and conversations with potential customers.
The business sees their target market strategy and their lean cost base as being their competitive advantage together with the impression that none of INVU's DMS competitors are currently focussed upon the agriculture sector. This gives the business a potential first mover advantage which will be supported by leveraging the marketing efforts and the
existing network of contacts to deliver the specifically designed sales process for the target market.
The suite of products, which are leased by the customer over 36 months, cost £15,016 and have a Gross Profit of 58%. This gross profit then funds the running and maintenance of the support service provided by the company.
Return on Equity over the 3 years of the Business Plan is strong at 60% given that there is a loss of £50,000 in Year 1. Year two generates a small profit of £24,000 with a healthy £64,000 in Year 3 onwards. Return on sales is 10% in year 2 growing to 14% in year 3. Break even point is in July 2011 (month 31) with the business cash positive in August 2010 (month 20). The financial risks are calculated as low due to the lease funding providing cash within 14
days of a signed document, plus there is no cash risk as the requirement to hold inventory is negligible. The balance sheet requires equity funding of £40,000 which is provided by the two directors at £20,000 each, plus a 60 month working-capital bank loan which is forecast to be repaid on month 25.
There are 46,000 farms in UK so, in this market sector alone there are potentially 9,200 (20%) sales presentations to be completed based upon the market survey data. On projected performance this would currently take the business 460 months to complete. The business case shows an improving performance month on month based upon an improvement in sales skills, product portfolio and brand awareness. The two employees Edward Gibbs and Mathew Easterbrook, both of whom are Directors, have each invested £20,000 in equity in order to start-up the business. They have 28
years of management experience between them and offer complementing specialities in the IT, sales, farming and finance areas. Their business objectives are to generate cash and satisfy customer needs by selling products at the right price with a sustainable gross profit margin whilst being commercially aggressive on costs. Their simple and equitable
company structure reflects their excellent relationship and the balance of power is shared equally. The product is a compliment of hardware, software and support service that is tailored to meet a customer's needs (Table 1). / AFRIKAANSE OPSOMMING: 'n Dokumentbestuurstelsel (DBS) kan organisasies help om meer effektief sake te doen en om die aantal eenvoudige en herhalende take met die hantering van dokumente te verminder. Hierdie voordele kan bestuur help om koste te verminder, foute te verminder,
gereelde take te outomatiseer en ook om inligting elektronies in 'n veilige en maklik bereikbare plek te stoor. Making IT simple (die onderneming) is 'n nuwe onderneming wat in 'n vennootskap ooreenkoms met INVU, Europa se snel groeiendste DBS sagteware verskaffer, aangegaan het. Hierdie ooreenkoms laat die ondememing toe om INVU sagteware te verkoop in alle industriee met geen bepreking op volumes of geografiese areas nie. INVU produkte is ontwerp om besigheid administrasie, en spesifiek die bestuur van dokumente, 'n eenvoudige en effektiewe proses te maak. Hierdie twee beginsels ondersteun die onderneming se doelwitte en bemarking deur die lewering van
eenvoudig-om-te-gebruik sagteware wat kliente help om kostes te verlaag deur vinniger prosesse sowel as verminderde daaglikse roetine administratiewe dokumentering take. Ten einde die marksegment wat geteiken moet word te bepaal het die direkteure 'n industrie analise (Aanhangsel I) gedoen wat geleenthede in die boerdery en landbou sektore uitgewys het. Die drie primere redes is: 1) Substansiele sektor groei van 30% per jaar (UK Agriculture, 2007), 2) geen bestaande DBS wat tans aktief in die mark is nie en 3) die direkteure het 'n gevestigde netwerk en detail kennis van die sektor. Alhoewel boerdery en landbou die hooffokus van die bemarkings en kommunikasie aktiwiteite gaan wees sal ander industriee, soos eiendoms en verhurings agentskappe, ook gesien word as toekoms geleenthede vir die onderneming. Marknavorsing is gebaseer op 138 voltooide vraelyste wat die direkteure in staat gestel het om 'n produk pakket bestaande uit 'n DBS lisensie en sagteware saam met die nodige
hardeware en ondersteunings saam te bondel, ten einde aan die mark se behoefte te voorsien. Die teikenmark is gedefinieer as boerdery ondernemings wat primer boer met gewasse en/of skape op tussen 41 en 80 hektaar produktiewe landbougrond. Die boerdery het ongeveer 20 voltydse werknemers waarvan die helfte met die onderneming se administrasie te doen het. Die administrasie bestaan meestal uit finansiele take en Regerings Departemente se verslae wat geprosesseer word op tot twee rekenaars met toegang tot Microsoft Office en 'n rekenkundige sagteware pakket. Vir sekuriteit en maklike toegang tot hulle dokumente stoor die tipe ondernemings hulle dokumente in liasseerkabinette vir tot 15 jaar, meestal in papier formaat. 'n Prioriteit vir ondernemings se administrasie binne die teikenmark is eenvoud en maklike toegang tot hulle dokumente, asook die sentrale berging van dokumente op een spesifieke plek. Die verkoops vooruitskattings vir 7, 12 en 30 eenhede oor die eerste drie jare 2009, 2010 en 2011, word gesien as realisties en bereikbaar deur die direkteure na aanleiding van formele onderhoude (Radley, 2008) en gesprekke met potensiele kliente. Die onderneming sien hulle teikenmark strategie en hulle lae koste struktuur as hulle kompeterende voordeel tesame met die feite dat geen van INVU se DBS kompeteerders huidiglik op die landbou sektor fokus nie. Die gee die ondememing die potensiele eerstetoetreder voordeel in die landbou industrie. Dit sal ondersteun word deur die hefboom effek van die bemarkings pogings komende uit die bestaande netwerk van kontakte om gefokusde verkoopsprosesse in die teikenmark uit te voer. Die suite van produkte, wat gehuur word deur die kliente oor 'n tydperk van 36 maande,
kos £15,016 en het 'n bruto wins marge van 58%. Hierdie bruto wins befonds die bedryf en ondersteuningsdienste van die onderneming. Die opbrengs op ekwiteit oor die drie jaar tydperk van die besigheidsplan is stewig op 60%
gegewe dat daar 'n verlies van £50,000 in Jaar 1 plaasvind. Jaar 2 genereer 'n klein wins van £24,000 met 'n stewige wins van £64,000 in Jaar 3. Opbrengs op verkope is 10% in jaar 2 en groei tot 14% in jaar 3. Die gelykbreekpunt is Julie 2011 (maand 31) en die onderneming is kontant positief vanaf Augustus 2010 (maand 20). Die finansiele risiko is laag as gevolg van die huur inkomste wat kontant binne 14 dae na die teken van 'n ooreenkoms genereer en ook omdat daar geen kontant risiko is met die dra van voorraad nie. Die balansstaat ekwiteit benodig 'n aanvangsbelegging van £40,000 wat voorsien word deur die twee direkteure teen £20,000 elk, saam met 'n 60 maande werkskapitaal bank lening wat geprojekteer word om volopbetaal te wees teen maand 25. Daar is tans 46,000 plase in die VK en dus, in die marksegrnent alleen, 9,200 (20%) verkoops voorleggings gebaseer op die markanalise data. Op die geprojekteerde werkstempo sal dit ongeveer 460 maande neem om te voltooi. Die besigheidmodel toon groeiende verrigting op 'n maand tot maand basis gebaseer op 'n verbetering in verkooptegniek, produk portefeulje en produk kennis. Die twee werknemers Edward Gibbs en Mathew Easterbrook, wat ook die direkteure is,
het elk £20,000 aanvangskapitaal geinvesteer ten einde die onderneming op die been te bring. Hulle het 28 jaar bestuurservaring en het komplimenterende vermoens in die IT, verkope, boerdery en finansiele areas. Hulle besigheid doelwit is om kontant te genereer en kliente se behoeftes te bevredig deur die verkope van produkte teen die korrekte prys teen 'n volhoubare bruto wins. Hulle eenvoudige maatskappy struktuur reflekteer hulle
uitstekende verhouding en die magsbalanse is eweredig versprei. Die aanbod aan die mark is 'n komplimenterende suite van hardeware, sagteware en steundienste wat aangepas word om aan 'n klient se behoeftes te voldoen (Tabel 1).
| Identifer | oai:union.ndltd.org:netd.ac.za/oai:union.ndltd.org:sun/oai:scholar.sun.ac.za:10019.1/4958 |
| Date | 03 1900 |
| Creators | Gibbs, Edward |
| Contributors | Butler, Martin, University of Stellenbosch. Faculty of Economic and Management Sciences. Graduate School of Business. |
| Publisher | Stellenbosch : University of Stellenbosch |
| Source Sets | South African National ETD Portal |
| Language | en_ZA |
| Detected Language | Unknown |
| Type | Thesis |
| Rights | University of Stellenbosch |
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