OFFICE EXPERTS

BUSINESS PLAN

MARCH 2012

Office Experts Business Plan Contents

1. 2.

2012

Business Description ............................................................................................................................. 4 Business Overview ................................................................................................................................ 4 2.1 2.2 2.3 2.4 2.5 Key Initiatives and Objectives ............................................................................................................ 4 Business Opportunity ....................................................................................................................... 4 Vision and Mission Statement ........................................................................................................... 5 Objectives ....................................................................................................................................... 5 S.W.O.T Analysis ............................................................................................................................. 5

3. 4.

Location and Facilities ........................................................................................................................... 6 Ownership and Management ............................................................................................................... 6 4.1 4.2 4.3 Organisational Structure ................................................................................................................... 7 Staff Duties and responsibilities ......................................................................................................... 8 Staff Remuneration ........................................................................................................................ 10

5.

Products and Services ......................................................................................................................... 11 5.1 5.2 5.3 5.4 5.5 Description of Products and Services ............................................................................................... 11 Key Features of the Products and Services ...................................................................................... 11 Procurement of Products and Services............................................................................................. 11 Future Products and Services ......................................................................................................... 13 Comparative Advantages in Procurement ......................................................................................... 13

6. 7. 8. 9. 9.1

Market Research ................................................................................................................................. 13 Marketing Opportunities .................................................................................................................... 13 Competitive Advantages ..................................................................................................................... 13 Marketing Strategy ............................................................................................................................. 14 Target Markets ................................................................................................................................ 14 Analysis of Competitive Position ...................................................................................................... 14 Pricing Strategy ............................................................................................................................. 15 Market Segmentation ..................................................................................................................... 15 Promotion Strategy ........................................................................................................................ 16 Industry Outlook ............................................................................................................................. 17 Regulatory Issues ............................................................................................................................ 17 Risks ................................................................................................................................................ 17 Market Risks.................................................................................................................................. 17

9.2 9.3 9.4 9.5 10. 11. 14 14.1

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14.2 15 15.1 16 17

2012

Other Risks ................................................................................................................................... 18 Implementation Plan ......................................................................... Error! Bookmark not defined. Implementation Activities and Dates.................................................... Error! Bookmark not defined. Financial Plan .................................................................................................................................. 18 Conclusion ....................................................................................................................................... 18

Office Experts Business Plan

1. Business Description

2012

Office Experts will be an office furniture retailing business located in Windhoek, the capital city of Namibia, . The company will specialize in bottom to top of the range office furniture that will suit customer specific needs for office furniture. The proposed products design and style will be unique in that it will rely on carefully selected suppliers that provide unique products. Office Experts will offer superior product quality and design at competitive prices. Our affordable designs will be a modern version of popular office furniture, scaled down in size to fit into today's offices. Office Experts products will be available in a variety of resilient finishes and colors so that customers have the flexibility to customize their choice of office furniture to their individual or organizational tastes. We will emphasize on superior quality furniture in a variety of popular faux antique finishes. While we currently intend on focusing on office furniture, our product line will be expanded to include bookcases, wall units, buffets, hutches and cabinets for a professional outlook. It is our ultimate objective to continuously expand and develop our existing product lines and add new product lines such as bedroom furniture, and household furniture within 3 years of establishing a reputable corporate image.

2.

Business Overview 2.1 Key Initiatives and Objectives

Our primary objective is to purchase the initial inventory and to finance the working capital. The initial inventory order will enable the business to set foot regarding its reliability and penciling its corporate brand in the Namibia corporate world. In order to do this we have found it necessary that we seek financial leverage through a bank loan.

2.2

Business Opportunity

Office Experts founded in 2011 by Margret von Luttichou and Barry Birch, is an office furniture retailing company located in Windhoek, Namibia. The company was formed in order to retail office furniture that meets the demands of the low income to upper income end of the office furniture potential and actual clientele. Preliminary research indicated that there are very few companies that specialize in office furniture retail and hence the market can still accommodate more players. It is the objective of office experts to tap into this vacuum and create a niche market, focusing on bottom to top of the range office furniture.

Office Experts Business Plan

2.3 Vision and Mission Statement

2012

Office Experts is a vibrant and innovative office furniture retailing company. It will offer our customers superior quality furniture and unique designs at affordable prices. We will continue to expand our product lines and introduce new designs, based on the needs of our customers. 2.4 Objectives

Our primary objectives over the next year will be to: 1. Increase sales by 27% during the next 12 months by increasing retail distribution of our new product lines. 2. Expand our product lines to meet customer demand. We will introduce three new types of products including cabinets for entertainment centers, wall units and bookcases. 3. Expand distribution of our product lines within Namibia. Our product will be sold throughout Namibia and where regional demand is significant we will utilize agents or where feasible establish new branches. Our intention is to increase the clientele base by 25% annually. 2.5 S.W.O.T Analysis Our evaluation of the business environment is as follows;

Strengths

Weaknesses Office Experts will be starting off with one retail shop in the Capital city. Office Experts will enter the market with the least market share in the industry. Office Experts will require loan financing or investors for it to finance its working capital needs.

The Office Experts management team and the key members have been in the industry in different capacities and have innovative ideas to turn around the performance of the Golden Fruit brand. The management team has intimate knowledge of the Namibian market. Office Experts has a vastly enriched human capital base to ensure success of the company.

Office Experts Business Plan

Opportunities Threats

2012

The furniture market has a few established companies competing in the market and Office Experts can take high percentage market share if introduced in market. Despite most brands having an advantage of early establishment no specific product has a high number of distribution sites; it has not translated this into market share leadership. Therefore market share is not driven by quantity of distribution sites only but by brand quality.

The niche locations attract interest from all competitors such that it may become unprofitable due to oversaturation of the market. Amendment of laws to protect the local industry.

3.

Location and Facilities

The Office Experts retail offices will be located in the city centre at shop 5 Gutenberg Street,Erastus Shapumba Tower. The shop is approximately 117 square meters and is leased for $1xxxxxxxxxx. There will also be a warehouse of size 200 square meters that will be located at xxxxxxxxxxxxxxxxxxxx. The location of the offices and the warehouse was carefully selected to reduce overheads and distribution costs. The location of the offices also offers an opportunity for potential and actual customers to constantly view the furniture on display, our location affords an opportunity for them to interact with the business.The close proximity to our customers means lower marketing, and transportation costs, additionally our distribution costs will be at a minimum possible. 4. Ownership and Management

Office Experts is incorporated under the laws of Namibia and is owned and operated by two partners, Margret von Luttichou and xxxxxxxx. Both partners have extensive experience in business management and the furniture industry. They will both be equally involved in its operations and management For the past 50 years, xxxxxxxxxxxxxx's family has owned a large upholstered furniture manufacturing plant in London, Ontario. Mr. Birch trained and worked at the company for 15 years. He also worked for a reputable furniture retailing company in the capital city. His experience and knowledge of the industry will

Office Experts Business Plan

2012

be instrumental in growing the business. He also worked for 5 years at a large national furniture retail chain as a purchaser. On the other hand Margret von Luttichou is an enterprising entrepreneur who owns., She also has experience in .. 4.1 Organisational Structure The owners will manage the company and share all managerial, administrative, and marketing functions. The company will initially commence with five full time employees. The furniture industry is very cyclical, so staffing levels will fluctuate continuously however the directors will evaluate to determine if there are any additional human resources needs. Part time employees who may be engaged will be promoted to full time as sales increase. Office Experts Organogram

Board of Directors

General Manager

Warehouse Supervisor

Sales and Marketing OfficersX2

Finance and Administration Manager

Warehouse Attendant

Driver

Office Experts Business Plan

4.2 Staff Duties and responsibilities The General Manager will be responsible for: Position
(Identified and available on a months notice)

2012

General Manager

The General Manager will be the most senior executive manager; he will report to the Board of Directors. The GM will be responsible for the overall management of the company, including the staff, the customers, the budget, the company's assets and all other company resources to make the best use of them and increase the company's profitability. It is expected that the GM will spearhead the development of a robust operational strategy and provide support to the Sales and Marketing Officers. The GM will assume a leadership role for Office Experts, and will ensure that the workforce is fully motivated. The GM will report to the Board of Directors on at least a quarterly basis to keep them informed of how Office Experts is operating. The Board will offer suggestions and ideas about how to improve the company to the GM. It will be the GM's responsibility to implement and improve upon these ideas. Key Responsibilities Decision making and supervision of department heads; Financial sourcing; Motivating staff; Business development; Negotiate supply contracts with selected suppliers;

Position

Finance and Administration Manager

(Identified and available on a months notice) The Financial Managers role will be to create value from the firm's capital budgeting, financing, and net working-capital activities. The Finance and Administration Manager will oversee the preparation of financial reports, execute cash management strategies (inflow and outflow of funds), and direct Office Experts investment strategies. The Finance and Administration Manager will be expected to demonstrate leadership in cost-effective uses of the corporation's financial resources by utilizing effective financial management practices. In this way the Finance and Administration Manager, will be responsible for maximizing the shareholder value. Key Responsibilities Production of financial and management accounts; Advising the directors on corporate governance issues; Cash flow management; Negotiating with suppliers for best discount rates; Creditors and debtors management;

Office Experts Business Plan

Ensure periodic and random stock counts are conducted; and Ensure the company complies with all financial legal requirements;

2012

Position Sales and Marketing Officers (Identified and available on a months notice) The Sales and Marketing Officer will be responsible for entrenching the corporate brand and image in the market. Marketing methods should result in maximum volume sales in a manner that does not violate business ethics, standard policies and procedures of the company, and legislation binding the industry. It will be the responsibility of the Sales and Marketing Officers to ensure that the company and the distribution to customers operates in the most efficient and effective manner. At commencement the Managing Director will double up as the Marketing Executive to ensure all strategic target customers fully appreciate the value in our products and service. Key Responsibilities Marketing the organization and products of Office Experts; Ensure existing customers are constantly appraised of new products; Develop the business and the market by searching for new customers; Ensuring products are strategically and conveniently displayed on the shop floor; and Ensure product prices are displayed all the time. Position Warehouse Supervisor (Identified and available on a months notice) Receives and inspects all incoming materials and reconciles with purchase orders; processes and distributes documentation with purchase orders; reports, documents and tracks damages and discrepancies on orders received. Receives and stores documents and confidential files; maintains record of approved document and confidential file destruction. Maintains the warehouse, records area and stores area in a neat and orderly manner. Key Responsibilities Determine the inventory holding levels; Determine the economic order quantities to be held; Ensuring that the warehouse is kept clean at all times; Liase with the sales department and ensuring orders are timeously delivered; and Conduct periodic and random stock counts.

Office Experts Business Plan

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Position (Identified and available on a months notice)

Warehouse Attendant

Assisting the Warehouse Supervisor in executing his/her duties and responsibilities. Key Responsibilities Assist the warehouse supervisor in coordinating deliveries from the warehouse; Assist in carrying out inventory stock counts; Assist In moving products from the warehouse to the truck and vice-versa; and Maintain the warehouse in a clean and orderly condition.

Position Driver (Can be available immediately) The Driver will be responsible for the transportation of products to and from the warehouse. Key Responsibilities Ensure products are timeously delivered to customers; Provide the customer with delivery note which the customer should sign to acknowledge receipt of goods in good order; Ensure the delivery truck is maintained in good order, clean and reflective of the organizational image; and Report all problems on check-in/out sheet and work order form.

4.3

Staff Remuneration

The following is a summary of the proposed salaries for the staff of Office Experts; Position General Manager Finance and Administration Manager Sales Officers Warehouse Supervisor Warehouse Attendant Monthly Salary 10,000 9,000 7,000 7,000 5,000 Annual 120,000 108,000 84,000 84,000 60,000

Office Experts Business Plan

Driver Total cost 5. Products and Services 5.1 Description of Products and Services 4,000 42,000

2012
48,000 504,000

Office Experts will procure furniture including office desks, bookcases, cabinets, office shelves. We will expand product lines to include household furniture in order to complete our lines of unique dining room and living room furniture. The furniture will be available in various different durable finishes and stains. The consumers will have the option to have their office furniture customized with their preferred finish or simply selecting the regular products that will be displayed on the shop floor. 5.2 Key Features of the Products and Services

The design and style of our proposed product lines will be unique. We offer superior quality and design at competitive prices. Our affordable designs will be modern version of popular antique pine furniture, scaled down in size to fit into today's offices, apartments, and condominiums. All of our products will be available in a variety of resilient finishes and colors so that customers have the flexibility to customize the furniture to their individual tastes. All of our furniture will made from superior quality hardware in a variety of popular faux antique finishes. 5.3 Procurement of Products and Services

Our company will seriously consider the buying criteria of the consumers. Consumer demand will determine the style, design, perceived value, quality, and price of the furniture.The reputation of the manufacturer from where we buy the furniture, will significantly determine our selected product suppliers. We will procure products that we feel will best meet the price, quality and design needs of our actual and potential customers. The turn-around time of deliveries once an order has been is estimated to be not more than 10 working days. Due to the considerably high inventory holding costs, approximately 60% of our display products will be provided by the product suppliers. It is also our strategic objective to maximize profits by taking advantage of discounts offered by our selected product suppliers. The following is a list of some of the product suppliers who have agreed to provide Office Experts with either display products or supplies at discounted rates. Chair Express General Cabinet Pro-trade Namibia

Office Experts Business Plan

Touchwood Furniture City Office Specialised Filing Sterling Furniture

2012

Office Experts Business Plan

5.4 Future Products and Services

2012

We will continue to expand and develop our product lines and add new product lines such as bedroom furniture. Our products design will continue evolve based on consumer trends and demand. We intend to obtain feedback from our customers and attend furniture trade shows to determine what furniture trends are popular. Based on this information and local demand, it is our goal to design and introduce 2 to 3 new products per year. 5.5 Comparative Advantages in Procurement

Office experts will utilize a flexible ordering system that enables us to shorten our order to delivery times effectively fill small orders. Our employees will be highly skilled craftsman with extensive experience in wooden furniture manufacturing. This experience, combined with short turnaround time resulting from machinery, gives us a competitive advantage over other small furniture retailers in the country. 6. Market Research

To analyze the market potential of office furniture products in Namibia we collected information from a number of sources. We talked to small wood furniture manufacturers located throughout the country to get their perceptions of the trends and potential of the wood furniture industry in Namibia. We also visited a number of small furniture retailers located in Windhoek to evaluate the types, styles, and quality of the competitive furniture being sold. The retail owners/managers were able to provide us with information regarding local consumer trends, level of demand and level of competition. To determine the potential midterm demand for office furniture in the country we collected statistical information from the Namibia Planning Commission. Additional information was obtained from research reports, magazine and journal articless, and newspaper clippings as well as information on the Internet. 7. Marketing Opportunities

Short term demand for office furniture is driven by disposable income, interest rates, and employment levels, while housing starts and income growth drive mid to long term demand. Windhoek and surrounding communities will grow quickly due to the opening of a new plant. The Namibian Economic Development statistics indicate that in the next 3 to 5 years macro economic growth will be on a steady increase. As a result, the demand for furniture will remain strong. Currently, there will not enough furniture retailers and manufacturers to satisfy demand and our company is in an excellent position to capitalize on this opportunity. 8. Competitive Advantages

While there are limited competitive office furniture retailers in Namibia our competitive advantages will include our unique furniture design and quality, a competitive pricing strategy, strong market demand, and a strategic location close to local and international suppliers, distributors, and consumers. Our competitive

Office Experts Business Plan

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advantages include our customer sensitive marketing strategy which will enable us to cost effectively shorten customer order and turn-around time. 9. Marketing Strategy

Office furniture is sold to consumers through retail outlets. Our company's promotional strategy targets both publicly owned enterprises and privately owned businesses. We will produce a catalogue featuring our product lines and samples of our wood finishes that will distributed to targeted customers. Our sales team will use the catalogues to show potential customers any products not displayed in our showroom and to order additional product. A brochure has been developed on each product line that is distributed to interested consumers. The product catalogue will show customers the actual products to be made available amongst our product lines. Our products will be priced competitively and take into account freighting where the suppliers will international. It will be the focus of Office Experts to follow competitive pricing strategies while being cognisant of consumer price sensitivity. The company's goal is to provide good quality furniture for a reasonable price while still maintaining healthy profit margins. 9.1 Target Markets

Our primary target market includes companies, hospitals, government, and small to medium enterprises in and around Windhoek. Secondary markets include independent retailers in other areas of the country. As our company grows and sales volumes increase, larger furniture chains and department stores will be targeted. Currently, our company does not have the capacity to service this market. Our primary consumer target market is established companies buying new or replacing office furniture. This segment of the market is growing in Namibia with the opening of new businesses. The NPC has forecast strong growth in population and housing starts. Unemployment rates will also forecast to decline which should increase consumer confidence and the demand for furniture. 9.2 Analysis of Competitive Position

Our company's product line will have several competitive advantages over our competitors including unique design and quality for a reasonable price. Our product lines will be flexible in that customers can choose different finishes to satisfy their style and design preferences. While other office furniture retailers offer this service, we will emphasise on our ability to negotiate for competitive prices and discount with our suppliers. While our product lines will competitively priced in comparison to other furniture lines offered through local retail outlets, we offer superior quality in that we will not be utilizing the traditional office suppliers. Currently, and in the near future there will not be enough furniture retailers and manufacturers in the area to satisfy demand and our company is in an excellent position to capitalize on this opportunity.

Office Experts Business Plan

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However, the furniture marketplace is highly competitive and furniture trends can change quickly. Consumers buy furniture based on design, quality and price. Consumers have very individual tastes that can change quickly. Office Experts management and staff have been in the business for a very long time and intend to utilize their relations with the corporate world to tap into the niche markets that will not be serviced by the established office furniture retailers. 9.3 Pricing Strategy

Our strategy is to price our products at a level comparable to our competitors. Our strategy takes into account production costs, competitive pricing strategies and consumer price sensitivity. The office furniture market is very competitive and the price conscious consumer market is looking for good value. Our company's goal is to provide good quality furniture for a reasonable price while still maintaining healthy profit margins. While, our company does not offer volume discounts to retailers, we do offer credit terms of 30 days. 9.4 Market Segmentation

The growth of business and the provision of office furniture in Windhoek will be critical to the success of the business. We will aggressively market our products to target customers who will include:

The Government of the Republic of Namibia ; State owned Enterprises; and Privately owned companies.

Office Experts Business Plan

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Market Segmentation (%age)

40

Government Schools 55 Prisons Private Institutions 5

9.5

Promotion Strategy

Our company's promotional strategy will target companies, state owned enterprises, individual and non profit organizations. Direct Marketing As the company grows, a marketing agent will be hired to promote our product lines to targeted customers. The objective will be to obtain the views and opinions of targeted customers on their preferred products. The marketing agent will be expected to identify any challenges that may hinder potential customers from making new orders. This will also be an opportunity to evaluate our customers satisfaction in our products and service. Brochures Brochures will be developed for products that we anticipate will be attractive to existing and potential customers. The brochures will feature pictures of each product and highlight the unique design and quality of our products. Office experts will use the catalogue to show potential customers any products not displayed in their showroom and to order additional product. Internet-Website In the modern day of technology it is part of the strategic marketing plan to create an Office Experts website that will complement the physical brochures. The website will allow customers to explore products on

Office Experts Business Plan

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display and those that can be availed by Experts. The major advantage being that the customer can interact with Office Experts from the comfort of their homes, offices or mobile phones. 10. Industry Outlook

The market outlook for office furniture in Namibia is positive. Demand growth is generated from a growing business sector. While total domestic demand for office furniture in Namibia is projected to see minimal annual growth of 1% over the next several years, product opportunities exist. For example, domestic demand for furniture is growing due to changing consumer purchasing trends. Consumers no longer view furniture as a once-in-a-lifetime investment. As a result, the demand for contemporary designs is increasing. Popular design and style trends include softer lighter wood tones, finer detailing, and faux aged hardwwill. 11. Regulatory Issues a) In order to protect the business we have put a trademark on the name of our company, Office Experts. b) The company will ensure compliance with all labour requirements and will uphold equal opportunity employment principles. The main focus in our recruitment policy will be to empower previously disadvantaged groups. 14 Risks 14.1 Market Risks

There are several factors that may affect the demand of our products. The Namibian office furniture industry may be indirectly affected by economic conditions. While the economy of Namibia is forecast to grow and remain strong over the next three to five years, this could result in increased competition. Our company will address these market risks by continuing to offer competitively priced products of superior quality. Due to the affordability of our products demand is projected to increase as customers become aware of the corporate brand. We will track changes in consumer trends by maintaining strong relationships with our customers. Continuous research will be carried out to keep track of the needs of the consumer market. Small style changes will relatively inexpensive and easy to make. Small independent retailers could lose market share to larger retailers and discount stores. It is important that our company use only reputable well known small retailers to distribute our product. Increasing the availability of our furniture by affiliating with retailers throughout the province should enable our company to achieve sales targets. Demand in the furniture industry is highly cyclical. However, our flexible manufacturing system and the use of part time labor allows us to cost effectively modify production as needed.

Office Experts Business Plan

14.2 Other Risks

2012

The availability of labor could become a problem with the opening of the new plant. The expansion of our product lines and increased sales volume will enable our company to promote our part time employees to full time. Once we have 5 full time employees we will also be in a position to offer a more comprehensive benefits package. Another risk would be the loss of a partner. The success of many companies is directly linked to their management team. However, both partners at Pine of the Times will involved in all aspects of company operations so the loss of one partner would not adversely affect the success or management of the company.

15 Financial Plan

16 Conclusion
The business plan was developed in order to provide Office Experts and targeted investors with the basic understanding of the capacity and potential of our team in the Namibian market. The business plan will only serve as a guide towards coming up with a robust business strategy as dictated by the market.