Secret Agent Is A Company

Published Date: 02 Nov 2017

Secret Agent is a company provides customer an easy and convenient way to prepare gift. As nowadays, people is left of time to buy gift and choose a suitable gift may take a longer time to search and find. So that, Secret Agent will act as an agent to search the gifts which are affordable and suitable for them. The company vision is being the first choose to the all customer.

The proposed legal form of Secret Agent is partnerships which form by 6 of the owner. All of the owner will participate in the management of the company. There will have RM500, 000 as the start-up capital.

Secret Agent is involved in local service industry, which an internet retailing service. The services sector of internet retailing has a strong growth in year 2012 which are growth of 11.6% from year 2011 to year 2012. As well as the Malaysia GDP also increase 6.4% in the same year.

Our company target customer is adult who ages from 35 to 54 dual to they have higher purchase power. According to our survey, our target customer has high income and they are left of time to choose gift. It also become they willing to spend money to hire agent for helping they prepare gift for they so that they can use gift as a way to increase they social network. Our company also has competitor come from few areas which are flower wholesalers, gift shop and luxury pen shop.

Our company will be located at Penang. However our company is running by virtual office basis. It is because to nearly our target customer. Our promotion tools will be using advertising through internet.

2.0 Business description

Secret Agent is the company that operates in a medium-size of Service Company. This company creates the easy and convenient way for people by provides the delivery services and other.

2.1 Mission and Vision statement

Secret Agent’s mission is to provide and promote the special surprise for all the people by help the customer to pick up the gift and send it out to the hand of customers. Secret Agent’s vision is being the first choose to the all customer.

2.2 Product and service:

As the agent of Secret Agent, we will help the customer to calculate the budget they can afford of the gifts. After that, we will send the gift lists for them to have a chosen. The customer can be chosen through our website or email as well as come up our company.

Besides that, we also got provide the delivery service. After we get know the customer’s order, we will collect the gift from other firm and do packaging then we will be sent the gift to the customer on time. If accidentally occurs such delay to send the gift for the customer we will be given half price discounts to customer that for compensate.

2.3 Legal Status and ownership:

Secret Agent is a general partnership company. Secret Agent is registered under the Companies Commission of Malaysia (C.C.M) under Companies Act 1965 and also registered of Business Act 1965. A partnership company is defines 2 or more partners but not exceeding 20 persons. In the general partnership, the shareholder is able to manage the business routines and during the company is faced losses, they shall be shall be sell the personal property to pay the debt if the company is unable to pay for. By the side, the limited partnership which means that they have no right to manage the business activity and if the company is facing the losses they is have no responsibility to pay up the debt, they just will only loss the investment that they’re invested. With this, the company is applied for the partnership agreement to avoid any misunderstanding conflict. The partnership agreement is a document that states the consent of parties to comply with particular rule and regulation.

The Secret Agent is organized by Lee Kian Kian and his friend. They are raised up RM500, 000 from an investor to set up SECRET AGENT and they are planning to earn the first million in the first 3 year. The CEO of Unique Secret is Lee Kian Kian, he just finish study MBA course in UK. Ng Pei See is being the assistant, she has 2 years working experience in S&J and also holding the certificate of ICSA and Diploma of business Administration. Kong Yung Yeow is Sales Manager, and he is holding the advance diploma of Business Administration in TAR College. Lim Ee Chin as the financial manager, he is just finish the course of degree financial and investment in Segi College, Lim Chia Chun is Packaging Manager and Lau Kuan Heng take part on Service. They all are just finish study on TAR College. They want to have some challenged so join to create this business.

3.0 Industry analysis

3.1 General description of industry

Our business "Secret Agent" is involved in local service industry, which an internet retailing service. Secret Agent is providing superior personal service to the consumer. There is a strong growth in the services sector of internet retailing, which the services sector of internet retailing has recorded a high growth of 11.6 % in the year of 2012 between with the year 2011. In addition, the GDP of Malaysia in the year 2012 is growth up at 6.4 % According to the industry structure; Secret Agent is in fragmented industry. This is because in the industry they are a lot of firm selling the different product and goods by giving the same service which is internet retailing. Other than that Secret Agent is in fragmented industry because all firms in this industry are small in size, relative to the size of the industry. According to the estimation report, the data show that the growth rate and size of internet retailing industry will have a lot of potential to growth up and getting bigger in the future.

3.2 PEST Analysis

3.2.1 Economic trends

The economic trend is an external environment that the company unable to control. The economic will affect every industry in the market directly. If the economic in Malaysia is bad mean that the inflation rate is very high and the GDP growth is very low. The purchasing power of the consumer will be decreased; this is because the inflation rate will affect the consumer not to purchase the product or service. So the produce or the product or service will decrease and the GDP growth rate will also decrease. When the quantities of product or service produce by a firm drop, the firms will also layoff some employees to cut down the cost of the firm. The unemployment rate will also increase and the consumer in the marker will purchase some product that they feel is necessary only. Therefore when the economic in Malaysia is bad all the industry in the market will affected directly, maybe some of the firm cannot immediately overcome then the firm will shutdown.

According to the financial report of year 2012, Malaysia GDP growth rate was increase 6.4%. That mean the economic in Malaysia is quite good and the purchasing power of the consumer is increase. This is because GDP increase means the firms in Malaysia produce more product and service. The firms will also gain more profit and the income of the consumer will increase. When the purchasing powers of the consumer increase, the consumer will more willing to spend their money to buy product or enjoy the service provide by the industry.

3.2.2 Social trend

Social trend is also an external environment and unable to control by the industry. Social trend is focus on the lifestyle and culture of the social changes. The social lifestyle is very important to a company. Social changes are the hardest changes for the company to prevent and forecast. A company can also use the lifestyle and culture of the social to forecast what the product or service that the social want in the future.

The marketing research show that the lifestyle of the social changes to lazy to go out from the house for purchasing things and shopping. They more prefer purchase things or shopping through the internet retailing. The social feels that purchase things or shopping through internet retailing is more convenience than go to one by one shop. Other than that, the consumer can save time and no need to waste time for searching the things that want to buy. Through this social lifestyle, our business "Secret Agent" will provide internet retailing and doorstep service, but our company is not only a company that provides purchasing things and shopping only. We also will according the customer need to help them find the product under their budget and help them to send the gift to the people they want to send.

3.2.3 Technological advances

Technologic is the thing that lead the human to development, the living standard of human has been improved into more comfortable and health life. This is because technological advances. Other than that, technologic advance will also bring some advantages and disadvantages to the company. The advantage that bring to the company is technological advance can help a company to increase their outcome and decrease the cost of the product meet the economics of scale. On the other hand, technological advance also will bring some disadvantage to some company. Those companies don’t know how to use technological advance to help in their company, they will be kick out from the industry by the competitors. This is because the competitors can enjoy many advantages by using technological advance like economics of scale. In our company technological advance will bring us a lot of advantages because our company is internet retailing. If the technological become more advance then the consumer will more easy to purchase our service. Therefore we can gain more profit.

3.2.4 Political and regulatory

This environmental force is related to the law and regulation implemented by the government. The law and regulation is a protection and guidance of a market, it can restrict the organization activities and it also can prohibited organization to do something illegal. More over if the company followed the laws and regulation it also can help the organization to maximize their activity. So that our business "Secret Agent" will ensure our business is follow all the law and regulation set by the government. So the business can operate legally and smoothly.

4.0 MARKET ANALYSIS

4.1 Market Segmentation

In 2011 the population in Penang is 1.6milion people in Penang, 26.2% of them are below 14 ages, 68.5% of them are 15 to 64 ages, and 5.3% of them are above 65 ages. We also have done a survey base on the age which is from 15 to 64. The survey is based on 100 of the Penang citizen respondents, which are 20 respondents for each level of age. The result is show at below.

Age

Income level

total

Below RM2000

RM2001-RM4000

Above RM 4001

15-24

17

3

0

20

25-34

5

13

2

20

35-44

1

15

4

20

45-54

1

10

9

20

55-64

12

5

3

20

total

36

46

18

100

Table 1.1 income level survey of 100 Penang citizens

The table 1.1 shows that the income level for age of 15 to 24 is low, 85% (17) of them have a below RM2000 income. It is because most of them are student or just start to work. The income level for age of 25 to 34 is median, 75% (15) of them have an above RM2001 income. It is because most of them are have working for a period of time and also be promoted. The income level for age of 35 to 54 is high, 65.5% (25) of them have a RM2001 to RM4000 income and 32.5% (13) of them have an above RM 4501 income. It is because most of them are manager level. The income level for age of 55 to 64 is low. 60% (12) of them have a below RM 2000 income. It is because most of them are retire. As a result, the age of 35 to 54 having a higher purchasing power, next is 25 to 34 ages and the last is 15 to 24 ages and 55 to 64 ages.

4.2 Target Market

To select our target market, we further our survey with the willingness hire an agent to prepare gift for them. The result is slow in the below table.

Income level

Willing hire an agent to prepare gift or not

Yes

No

Below RM2000

6

30

RM2001-RM4000

40

6

Above RM 4001

17

1

total

63

37

Table 1.2 Willingness to hire gift agent of each income level

Table 1.2 shows that, income above RM2001 are willing hire an agent to prepare gift. As the result of the survey, the groups of people which age are from 35 to 54 willing hire an agent to prepare gift. It is because of the few reasons to pursuit them doing such decision.

First reason is because of them have such purchasing power. Second reason is because giving gift may help them to improve social network. Social network is impotent to them daily live, such like working as seller man or a market. Third reason is because of left of time to prepare the gift. As writing in above, most of them are manager level, so they may facing left of time to preparing gift or purchase gift. Forth reason is because different to choose a suitable gift. Most of the people don’t want to give gift is because they don’t what gift is suitable to give. And the last reason is because they can’t remember all friend or business party or customer birthday. However nowadays technology advantage but it only can remind them on that day, but they may facing no time to prepare gift.

As the result, they willing to hire an agent for helping them take care of such problem. At the conclusion, our target market is adult who are the ages from 35 to 54 with them high purchase power.

4.3 Competitor Analysis

Our competitor is come from few areas which are flower wholesalers, gift shop and luxury pen shop. To clear understand our competitor, we have chosen few of shop to represent this 3 area of competitor. LOVE represent flower wholesalers, SnJ represent gift shop and Montogomery Pens represent luxury pen.

4.3.1 LOVE flower wholesalers

LOVE Sdn Bhd is a Malaysia florist specializing in free delivery of fresh flowers to all areas within Malaysia. LOVE Sdn Bhd is an online florist specializing. LOVE Sdn Bhd was lauched in the early day of year 2004. They provide online order and delivery service. They also provide special designs of fresh flowers bouquets and arrangements to customer.

4.3.2 SnJ gift shop

SnJ is a first-of-its-kind "gift and collectable" chain store in Malaysia. They provide unique gift and doesn’t cost the earth. SnJ first started in 2002 at a shop in Jalan Sungai Dua, Penang. Today SnJ become successful and recognizable brand names in Malaysia. Currently in Malaysia they have 18 outlets.

4.3.3 Montogomery Pens luxury pen shop

Montgomery Stationery was started in 1977 in the Lower East Side of Manhattan, New York. For these 30 years, they have been serving their customers with all their office products and fine writing instruments. For selling a lower price pen to customer, they buy large quantities directly from the pen manufacturer.

4.4 Competitive Advantage

Name

Secret Agent

LOVE

SnJ

Montogomery

Price

Advantage

Even

Advantage

Disadvantage

Branding

Disadvantage

Even

Even

Advantage

Packaging

Advantage

Advantage

Disadvantage

Even

Delivery Service

Advantage

Advantage

Disadvantage

Advantage

Customizable

Advantage

Advantage

Disadvantage

Even

Customer Service

Even

Even

Advantage

Even

User Feedback

Advantage

Advantage

Advantage

Advantage

5.0 Operation and Marketing Plan

5.1 General description of operation planning

The company created to help individuals, groups or organizations to build and maintain their relationship with each other on website based. We provide our customer the easier way for them to make them keep in touch. We do not actually produce any product but in fact we provide our intelligence and creativeness of service to help our customers to prepare their gift for their social circle.

It is very simple because all they needs to do is to registered on our website as our community and we will help them to linked with each other with theirs’ social group. Our business is to help them remind their business partners, family, relative or friends about theirs’ anniversary, birthdays, or any other special days. Then we will help them to purchasing, packaging, designing and delivery the gift to the person or bodies who committed on the dates. Our business location is set up in the city area, we are planning to start-up the business from a small city area because we can easily concentrated our customer’s network at the initial until we are able to expand them into the more big area of city or linked to another city.

We have divided our staff into several departments which is IT department, Marketing department and Process department. IT department responsibilities are including the entire task related to computer and website. Marketing department responsibilities are to analyzing that the price and the product are matching the demand of the customers and thus making decision on purchasing product. And process department responsibilities are packaging, designing and delivering the gift to the final customers.

Our company was care about the customers’ needs because we will purchase the products according to the budget and also the requirement of customers. We will put the largest effort in order to bring the biggest benefits to our customers and also reach theirs’ sincerity to others.

5.2 4P

5.2.1 Product and Service

Our company has provided delivery present and help customer to buy present. Once we received any offer from customer, we will ask details from customer and will help them to choose any things as present. After we buy the things and package it, we will help our customer deliver the present to the person who received it. The reason we provide this service is because, customer can save their time to go to shop choose present and sent to their friends or relatives. Now a day, all people were busying to their work and lack of time to buy and sent the present to the receiver. Due to this reason, we have set up a company whose can help our customer to solve these problems. Not just this only, our service also can give the receiver a surprise when his/her birthday. Other than this, we also will help customer to mark-down their friends and relative birthday date and will remind them before 1 week.

5.2.2 Price

We will charge the price based on the concept cost based pricing. Cost based pricing is the list price is determined by adding a markup percentage to the product’s cost. We will charge the customer based on the things they decide to buy and added 30% as delivery charge. Besides that, for those customer has purchase things that more than RM100, we will give them free delivery charge. Other than this, we also will charge the customer difference price based to special days, like when celebrate Valentine day, we will charge the customer 25% if they has purchase more than RM50 and will giving a rose as a gift to customer.

5.2.3 Promotion

We will have a promotion to increase our popularity and increase our profit by make advertising through internet. Nowadays, all people is using computer, mobile phone, smart phone, or others technological equipment to get news. Due to this opportunity, we will make advertising through Facebook fans pages, Blogspot or Youtube. Besides this, we also will use banner as our promotion tools. We will put banner at some area there are not so famous in Penang, this can help us to promote our service. We also will give promotion when special days such as Father’s days, Mother’s days or Valentine days. Other than this, we also will create a customer group in Facebook to updated them latest news or any latest information that has related to our company.

5.2.4 Place/ Distribution

We have set Penang as our strategy business location to operate the business. The reason why we choose Penang as location, it’s because our company is set up at Penang, and it is easy us to deliver the present to receiver. In addition, Penang is one busy city and most of people are busy on their work and no time to buy present. So because of this, our service will help them to solve this kind of problems and can help us to operate our business easy and make profit. Penang is a state that provides free wi-fi service, so with this advantage, we can let many people know our company through the internet. For our future plan, we plan to set up new branches at Kuala Lumpur by next year.

6.0 Financial Projections

6.1 Start-up Budget

Capital Expenditure

RM

RM

Furniture

30,000

Office equipment

30,000

Motor vehicle

100,000

Renovation

10,000

Machinery (Duplicator)

10,000

Sub- Total

180,000

Working Capital

Marketing

10,000

Administrative

5,000

Sub-Total

15,000

Other Expenditure

Pre-operating

Register website

5,000

Insurance

3,000

Business registration

3,000

Sundries

400

Road tax

___

300

11,700

Deposit:

Utility (telephone ,water, electricity )

2,000

Sub-Total

13,700

Grand Total

208,700

Add: Contingency cost (10%)

20,870

Total Start up cost

229,570

6.2 Pro Forma Income Statement (2 years)

Pro Forma Income Statement for Secret Agent

Year 1 (2013)

Year 2 (2014)

RM

RM

RM

RM

Sales

500,000

700,000

Less: cost of goods sold:

Opening inventory

-

30,000

Add: Purchases

180000

230,000

Less: Closing inventory

(30000)

150,000

(20,000)

240,000

Gross profit

350,000

460,000

Less: Expenses

Salaries

120,000

120,000

Water

500

600

Electric

6,000

6,000

Rental

Website annual pay

36,000

1,000

36,000

1,000

Wifi service

1,380

1,380

Renovation

20,000

-

Insurance

3,000

3,000

Bank installment

17,500

17,500

Advertising

10,000

10,000

Telephonebil

1,500

1,800

Repair & Maintenance

2,000

3,000

Security (CCTV)

5,000

-

Depreciation: (10%)

Office equipment

3,000

3,000

Machinery

1,000

1,000

Motor vehicle

10,000

10,000

Furniture

3,000

240,880

3,000

217,280

Net profit

109,120

242,720

6.3 Pro Forma Cash Flows (2years)

Pro Forma Cash Flows for Secret Agent

RM(2013)

RM(2014)

Cash Flow From operating activities

Net income

109,120

242,720

Adjustments For:

Depreciation

15,000

15,000

Doubtful Debt

3,000

5,000

Interest income

(1,100)

(2,000)

Operating profit before working capital changes

126,020

260,720

Decrease in receivables

5,000

5,000

Increase in accruals

3,000

5,000

Cash generated from Operations

134,020

270,720

Income tax paid

(15,000)

(20,000)

Net cash from operations activities

119,020

250,720

Cash flows from investing activities

Interest received

1,500

1,500

Net cash from investing activities

120,520

252,220

Cash flows from financing activities

Capital

500,000

-

Interest paid

(1,500)

(1,500)

Net cash from financing activities

498,500

(1,500)

Net increase in cash and cash equivalents

619,020

250,720

Cash and cash equivalents at beginning of year

-

619,020

Cash and cash equivalents at end of year

619,020

869,740

6.4 Break Even Analysis for Secret Agent

The table below shows the break even point analysis. We assumed that will be 1000 units to be sold at the months.

Selling price per unit is RM30

Fixed costs (Month)

Salaries 120,000/12 = RM10, 000

Insurance 3,000/12 = RM250

Bank loan 17,520/12 = RM1, 460

Wifi services 1,380/ 12 = RM 115

Rental 36,000/12 = RM3, 000

Total Month fixed cost RM14, 825

Variable cost (Month)

Telephone bill 1,800/12 = RM150

Water 600/12 = RM50

Electricity 6,000/12 = RM500

Renovation 20,000/12 = RM1, 667

Repair & maintenance 2000/12 = RM167

Total variable cost RM2,534

RM2534/1000 = RM 2.53

Variable cost per unit is RM2.53

Break Even Point:

Calculation: Total Fixed cost

(Selling price – Variable cost)

= 14,825/ (30-2.53)

= 540 units