Kleen Shine Saloon Operates

Published Date: 02 Nov 2017

Kleen-Shine Saloon operates at Solaris Mont Kiara, Kuala Lumpur. Because Kleen-Shine Saloon is new to the industry, it is anticipated that there will be a net loss in the first year. Nonetheless, the company would earn a net pprofit of xxx with xxx revenue in the following years. It is also expected that an increase of 25% net profit and revenue would be achieved in the following years. Chart 1 show the sales, expenses and profit growth of Kleen-Shine Saloon in three years.

Kleen-Shine Saloon will implement a variety of marketing strategies to achieve the sales target. The company will carry out the advertising via different channels. Newsletters, brochures and banners are used to create awareness to residents at Mont Kiara. Promotional videos are uploaded to the company webpage and social networks such as FaceBook, Twitter and YouTube.

Kleen-Shine Saloon is a limited company which belongs to five persons. Each of them would inject RM 60, 000 into the company. The company would also apply long term loan from bank with amount of RM 500, 000 as investing capital, which sums up to RM 800,000.

RM 170, 000 of these funds will be used to buy car washing equipment. RM 45, 500 will be used for marketing expenses while the remaining funds will be used for company daily operations.

Introduction

Company and Business Description

The company’s name is Kleen-Shine Sdn. Bhd. The targeted location to carry out our company’s business is Mont Kiara. The residents of this neighborhood belong to upper income receiver. Besides, the population of this area is big. Thus, there is a huge potential for our company to operate there.

Kleen-Shine Sdn. Bhd. provides car wash services, which can be conducted either by machine or by manual. Our company utilizes automated car washing machine which enables customers to have their car cleaned within a short period of time. This would be an ideal car wash service for people who are in rush. On the other hand, for people who intend to have their car cleaned inside out, we provide a complete cleaning service which includes polishing and waxing of the surface of the car, cleaning of car engine as well as vacuuming of the seats and the carpets for the interior of the car. We do provide on-call service to cater the needs of people who are busy and time concern.

The company’s mission is to provide a car wash service at the same time carrying out the social responsibility by being eco-friendly. Our objectives are to be the largest car wash company in Mont Kiara and next, to expand our business to other neighbourhood.

Kleen-Shine Sdn Bhd is owned by Yap Chee Hong, See Jun Hao, Ngeow Jia Jun, Tan Yong Ye and Poh Chee Loong. Each of them had injected a total of RM 500,000 as a startup capital for the business.

Contents

2.1 Industry Analysis

2.1.1 Environmental Analysis

Mont Kiara is an affluent township which locates in northwest of Kuala Lumpur and very near to Sri Hartamas. Mont Kiara is mainly consisting residential of condominiums and office complex. Recently, the population in Mont Kiara is rising due to more and more houses are being builds such as the Arcoris Mont Kiara which consist of residential and hotel. The raising of residential area actually will give us an opportunity to start up the car wash and salon services.

The car population at Mont Kiara is also very high because the residential of Mont Kiara are wealthy which one family will have average 3 to 5 cars. Since each family has 3 to 5 cars, it is an opportunity for us to help them to take care of their cars by providing the car salon services. Besides that, the level of efficiency of public transport in Kuala Lumpur or to a major aspect Malaysia is still low and can be described as inferior. This is one of the reason why each family will have 4 to 5 cars because there is lack of public transport in Mont Kiara area.

Mont Kiara area have give us a chance to open a car wash and salon services because there are the commercial project like the 1 Mont Kiara, Plaza Mont Kiara, Solaris Mont Kiara and Solaris Dutamas. All these are the business centre that will actually bring crowd and prosper to the area.

Moreover, the area that we target are having high average income group in Malaysia compare to other places. Residents and businessman in there are mostly driving luxury car so that they would have money to invest on their car by having car salon and etc.

2.1.2 Industry Analysis

In Mont Kiara, there are around 5 car wash services those offerings affordable rates such as RM5 per wash. Some of this car wash are locate inside the shopping complex which is the 1 Mont Kiara. But, many of the car wash services are closed during weekends and public holidays.

However, the competition of car wash services in Mont Kiara is still relatively lower compared to area such as Klang Valley, Cheras and Petaling Jaya. Besides, there is no car salon services provided in Mont Kiara which mean that give us an opportunity to become the first to introduce the car salon services to residents of Mont Kiara.

In addition, the suppliers of the car wash and salon services will actually influence the pricing. As the price of the car wash product is rises, it will also cause that charges become higher for maintenance, replacement and etc. This will probably affect the company’s profitability.

As the Mont Kiara is rising in population no matter is cars or residents, it give us an opportunity to move in our business into that area. There is also an opportunity for us to introduce the high tech equipment for Mont Kiara residents to be the first to experience the steam car wash which is never been implemented by any others competitors.

Customer services are important for a business to be success and survive. And therefore we did have the rewards and bonus point system that allow us to retain the customer’s loyalty. We also accept the feedback by customer after the sales in order to satisfy the customer and eliminate the customer’s dissatisfactions. With less complaint rate, it do raise up the images and reputation of our company and with the customer as the referral to become more popular in this industry.

2.2 Market Analysis

Expatriates, world travellers and the well-heeled have long been drawn to the exclusive enclave of Mont Kiara. This global cosmopolitan community is a designated International Zone. Just 6 km from the Kuala Lumpur city centre and mere minutes from reputable international schools, commercial centres entertainment and leisure facilities. Therefore, many commercial projects such as 1 Mont Kiara, Plaza Mont Kiara, Seni Mont Kiara, Solaris Mont Kiara and Solaris Dutamas are being developed at Mont Kiara. Due to the development of the commercial project, population of Mont Kiara is estimated increase to 300,000.

Kleen-Shine saloon located Solaris Mont Kiara which is the most crowed commercial centre. It is uniquely designed as a self-contained urban centre where one can enjoy between work and life. Its surrounding neighbourhoods include the affluent Damasara, Bukit Kiara and Sri Hartamas. Besides that, Solaris Mont Kiara strategically set up at the up-market residential suburb of Mont Kiara. There are a lot of high-end condominiums, corporate offices and international schools nearby it. Many new businesses like bars, pubs, clubs, food industry and Cold Storage supermarket operated in Solaris Mont Kiara. Thus, Kleen-Shine saloon can easily access to their target customers because of the strategic location.

The population of Mont Kiara are mostly from the high income and high living standard family. The average number of vehicles own by a family is 3 luxury cars. Their busy lifestyles create the opportunity to Kleen-Shine. Besides of the busy lifestyles, the target customer of Kleen-Shine in Mont Kiara is who income level more than RM 5000 per month. They have higher spending power and they able to afford to high cost for beautified their luxury car.

Car wash industry have the high potential in Malaysia because the number of vehicles increasing year by year. According to the statistics of Kenderaan Pengangkutan Malaysia, the number of new registrations vehicles in 2010 to 2011 increased from 20,188,072 to 21,401,269. However, Federal Territory of Kuala Lumpur recorded the highest numbers of new registrations vehicles which is 328,578. The large number of vehicles in Kuala Lumpur provides business opportunity to the Kleen-Shine saloon.

Kleen-Shine Car Saloon is located at the Solaris Mont Kiara which is nestled at the post Mont Kiara sphere. It provides on-call service for all the residents in Mont Kiara area and automated car wash machine for those busy working people. Its targeted consumers is who upper income receivers because it is providing those premium and luxury car saloon service to consumer. Besides that, free of charge membership strategy is apply to build strong customer base and it is useful to attract customers.

Pit Stop Car Saloon is located at the Desa Sri Hartamas which is lot-22 at Jalan 28/70A in Kuala Lumpur and it is near to Mont Kiara. It provides car saloon without any membership registration. Its package includes car wash, polish, wax, tar spot removal and tyre shinning service for lower price. Its package’s price is much lower than Kleen-Shine Car Saloon and it could attract those lower to medium income receivers. Moreover, it has the least operating hours compared to others competitors.

CARs international is known as a well-known car saloon company in the industry. It has a lot of outlets in those shopping malls’ car park area in Klang Valley such as Mid Valley, Sunway, KLCC, Times square, 1utama, Mont Kiara and etc. It provides conveniences for those people visit shopping mall because its customers do not need to bother about looking for parking area for their vehicles. Besides, their membership price is quite affordable for all type of income receivers.

Shine Shine (M) Sdn Bhd is one of the famous car saloon companies in Malaysia. It has a lot of outlets around the Malaysia and it provides a lot of packages’ choices for consumers. The nearest shop lot with Kleen-Shine is Mont Kiara which is located in Giant hypermarket. Shine Shine (M) Sdn Bhd has their own club which named Shine Shine club and it had obtain a lot of members. Shine Shine (M) Sdn Bhd not only focus on those hypermarket, they also open this car wash centre in the workshops. It got almost 25 car wash centre around the Klang Valley.

In conclusion, Kleen-Shine has more strategic location and it provides different kind of services. On-call service could target those condominium resident because they don’t have time and space to wash their cars. Other than that, customers are more concern on environment friendly and Kleen-Shine perform well in this aspect with their biodegradable washing shampoo and steam car wash, the shampoo used do not harm to environment and steam jet could save a lot of water.

3.0 Marketing Plan

Product and Services

Kleen-Shine is a company that provides car saloon services. We provide car wash, snow wash, engine wash, car polish, vacuum, glass coating and etc. Our company has brought in equipments which are manufactured by D&S Car Wash Systems and SJE Corporation Ltd. at U.S.A. Preventive maintenance and equipment software updates will be performed once for every six month to ensure the quality provide to the customer.

Automated car wash machines are provided for customers who wish to clean the exterior part of their vehicles. Because of the advancement of technology, these machines allow the vehicles to be cleaned in a short period of time and therefore is suitable for people who are in rush. The automated car wash machines come along with an auto cashier system. Therefore, customer can patronage us at anytime even when we are closed.

Besides that, we also provide manual car wash services. This includes both exterior and interior cleaning of the vehicles. Although the car washing process is conducted in a tradition way, our company supports the idea of going green. Instead of using harsh, acid base detergent, all of the solution used by our company are biodegradable and include UVA and UVB light absorber which can protect the surface of the car. One of our core competencies is the implementation of steam car wash concept. Steam car wash uses steam jet to wash and clean car’s exterior and interior. Steam jet is completely safe on car surfaces when used correctly. Moreover, steam has sanitizing and deodorizing effects. The most special feature of steam car wash is its eco-friendliness as it requires very little water (<1 gallon per vehicles by average) as well as not causing any waste water. As the steam jet are virtually mobile, our company also provide on call services around Mont Kiara area. This will provide convenience to customers who live at places which has no appropriate car washing area especially for those who live at condominiums.

Apart from exterior and interior cleaning, Kleen-shine also provide add-on services such as repairing light scratches, protecting a car’s finish, restoring black to plastic trim, detailing a car, rust repair, removing a scratch, replacing weather-strip and restoring a headlight. Kleen-Shine also have set-up an air condition waiting room for the customers.

Promotion

Kleen-Shine offers public to join into our membership. The registration is free of charge and only RM50 renewal fee s charged annually. By joining the membership, one can enjoy a discount of 10% on any product or service offered by our company. Besides, customers can get a free car washing service every 10 times they patronage our company.

Kleen-Shine promotes our products and services through various types of promotion tools. For printed media advertising, 3,000 units of brochures and newsletters are distributed to the residential areas in Mont Kiara. These brochures and newsletters stated are used to update customers about our latest news, promotions and services provided.

Furthermore, we have created our own advertising video to promote our company. The purpose of creating these video is to let customers have a brief view on how we actually clean or detail their vehicles. This would inspire a sense of confidence and trust in customers towards our company. The videos are uploaded to different channels such as Youtube, Twitter, and Facebook.

Moreover, a free car wash service is offered to members who recruit friends or relatives to join our company’s membership. It is a referral marketing to promote our products and services. It is a strategy used to minimize the advertising costs at the same time increase Kleen-Shine’s popularity and maintain customer loyalty. Besides, we also have business cards that state the services provided by our company as well as the contact numbers. We also set up banners at conspicuous spots around Mont Kiara area. It helps us to create awareness of our company to customers.

In addition, Kleen-Shine forms a strategic alliance with BonusLink. Every time customers spend money at Kleen-Shine, points are rewarded to the customers. The points can then be redeemed into several prizes.

Place

Kleen-Shine Saloon is located at the Solaris Mont Kiara which is nestled at the posh Mont Kiara sphere. It is designed as a self-contained urban center where one can enjoy between the work and life. It’s surrounding by the Sri Hartamas, Damansara Heights, and Bukit Kiara.

There are 79 contemporary units of 5-storey shop offices, 3 towers of 10-storey office suites and distinguished retail outlets which contain 4-storey basement car park.

Solaris Mont Kiara strategically set up in the up-market residential suburb of Mont Kiara, the vicinity is comprised of high-end condominiums, corporate offices and international schools. Besides that, there are plenty of clubs, pubs, bars and Chinese restaurants, including the Afterhour, My Beauty Cottage, Schokolart Michelangelo’s and Envy Club. Such crowd would give an opportunity to our company to increase the patronage of customers.

There are also the F&B outlets and Cold Storage supermarket nearby our car saloon. It provides convenience to our customers as they can shop for their groceries and have their vehicles embellished at the same time. Thus, our company selected this ideal location to set up the car saloon.

Pricing

Kleen-Shine’s target market is upper-market customers with high income level and purchasing power. Therefore, our company selected value-based-pricing as the pricing strategy. Value-base pricing strategy considers the value of the services, as opposed to the cost the company incurred to produce it. Our company estimating how much money or value of our service will generate for our customers. The value could originate from factors such as increased the efficiency, happiness or stability. Our company core service is car wash which is automatic car wash machines or manual car wash services. The price of automatic car wash machines is RM 25 and the price of manual car wash is RM 35 ringgit. For the on call service, we charge for RM 68 which only available for nearby area.

Car polish is another core service of our company. By using the premium pricing strategy, we set the price range from RM200 to RM300 which depend on the size of vehicles. Such high prices are charged because of the unique luxury services. We use the 3M car care product which can provide the maximum paint protection and high gloss shine lasts to six months. Other add-on services such as repairing light scratches, protecting a car’s finish, restoring black to plastic trim, detailing a car, rust repair, removing a scratch, replacing weather-strip and restoring a headlight price range is from RM80 to RM 300.

Besides, our company also applies the product bundle pricing strategy. We combine the several services into a same package. Package A is RM 200 which included automatic car wash plus car polish. Package B is RM 220 which included manual car wash plus car polish. Package C (luxury package) is RM 388 which included all service we provided. The attractive services which included in the package will let customers choose the entire services we provided.

To build the customer’s loyalty, we issue our own member card. The membership card we provided is free of charge. Customers who sign up for our membership will enjoy different kind of promotion throughout the year. Promotional pricing which only for our member card holder. They can enjoy the 10% discount for every product and services we provided. For package A, only charge RM 168 for our member. This strategic can built a strong customer base for our company.

People

People is one of the crucial assets for Kleen-Shine. As our targeted location, Mont Kiara, belongs to a middle-upper income area, we have to ensure that the people we employ have certain standards in order to maintain the company's reputation.

The employees Kleen-Shine hire must be able to speak in different languages. English spoken individuals would be given priority. This is due to the residents of Mont Kiara are mostly foreigners and English speaking people. Thus, it is a must for our employees to be English literate in order to communicate with the customers. Besides, the staffs working at the customer service counter are given training before allowed to be on duty. As they are the ones who interact directly with the customers, we ensure that our staffs behave and speak courteously. We have to be certain that our staffs treat our customer in the proper manner as they represent our company's image and reputation.

In addition, for the add on services, we hire experts to perform this job. As the customers trust our company to beautify their vehicles, we have to ensure that the quality of service we provide must be superior. Thus, employing expert to perform their expertise would give customer a sense of assurance towards our company which could lead to customer loyalty.

Process

When a customers vehicle enter our car wash compound, they will be guided to either the manual car wash area or automated car wash area, depending on what service they request for. For automated car wash, the customer has to first pay at the auto cashier located in front of the car washing machine. When the bill is paid, the customer would then allowed to proceed to the car washing machine. The whole process only takes less than 10 minutes.

For the manual car wash service, the customer can park their vehicles at the designed lots. They would then be led to the waiting room where they can have a rest while waiting for their car to be beautified. They would be notified once their vehicles are ready.

Physical Appearance

We have a big shop sign 'Kleen-Shine Saloon' placed in front of our shop. Our shop lot is painted in light green colour. This would create warm and peaceful ambiance within our shop lot. This appearance would also be congruent to our idea of supporting go-green concept. Besides, the lighting in our shop lot is bright and clear enough. This lighting would make the vehicle looks shinier after being waxed and polished by us. The waiting is equipped with air condition and dim yellow lights. The walls are painted in dark brown colour. This would create a very harmony and cosy atmosphere within the waiting room. There is also a big transparent glass door which allows customers to have a view on the cleaning process of their vehicle. There is also a rack displaying our car care products. The car washing process is held at covered area. This would allow the vehicle to be washed under any kind of weather. The automated car washing machine is located at the uncovered area. This would create a better flow of traffic and prevent congestion.

4.0 List of Assumptions

Note 1 : Equity Investment and Loan

We have total of 5 shareholders and each shareholder will contribute RM60,000, amounting in total to RM300,000 into the financing of Kleen-Shine Salon. Besides, Kleen-Shine salon will also apply RM500,000 in interest rate 7% each year of loan from bank with 3 years monthly instalment. Overall, we have total fund of RM800,000.

Note 2 : Total Sales

Kleen-Shine will starts its operates on 5 January 2013. In the first month, we estimated there are RM15,000 of sales because the customer would like to have a first try on our services. For second month, if the customer like our services then the sales estimated to be RM35,000.

Note 4 : Marketing Expenses

We assume that the cost to create company website and software will be RM10,000 each including design of the website. Besides, the creation of membership card are estimate to spent RM30,000. Furthermore, the advertising expenses are estimated RM5,500 each month and there will be no increasing on the following months.

Note 5 : Facilities

The car saloon utilities charges are estimated to be RM3,000 per month. Furthermore, RM30,000 will be used to pay the rental fees of the shop every months. Moreover, we use about RM150,000 to import the car wash machine from the U.S. and also there will be RM20,000 to decorate the waiting room. Lastly, the maintenance management cost are estimated to be RM1,500 per month without increasing price on that.

Note 6 : IT/IS

We have signed the UniFi (Biz 10) and Astro Commercial Packages for RM2,400 semi-annually with a contract of 2 year basis. In addition, we did use RM10,000 to develop a software for membership signup and rental fees of RM200 for telephone and printer.

Note 7 : Financial Expenses

To settle the loan, we have to pay RM17,000 each month due to RM500,000 of 7% loan.

Note 8 : Professional Fees

The accounting and book-keeping fees will be charged total of RM350 each month.

Note 9 : Banking Charges

On fifth month, we will rent the credit card merchant services to bring convenience to the customer of RM600 each months.

Note 10 : Miscellaneous Expenses

In order to operates to Malaysia, there will be a one-shot charges of RM5,000 for the company registration and license. Other than that, we also pay insurance for the company of the amount of RM9,600 each years.

Conclusion

Based on the assignment, we have to make a business plan on opening a car wash and salon services in Mont Kiara. We did research and site visit on Mont Kiara area on what are the lifestyle of the residents in Mont Kiara. Besides that, we also did survey the car wash competitor around the Mont Kiara who are directly competiting with our business.

Furthermore, we also did an evaluating on the price and promotion around KL area and determine our own pricing and promotion that could win the competitors.

We also learned the process of car wash and salon. It will help us to dominant the market with a prior knowledge on this industry. Other than that, we also learned to prepare the cash flow of the year and how many capital we should have in order to start up a business.