Abstract
This paper entails a business plan of George’s Winery. It narrows down to only two significant aspects those are the operations plan and the financial plan (Pinson, 2008). George’s Winery is an online business that deals in the production and marketing of red wine, as well as white wine. This plan describes the operations plan in terms of the staffing, the production process, storage, the work schedule, the number of employees involved at each stage, the risk analysis statement in terms of threats and opportunities of this business (Chen, Yen & Kotha, 2009).
Furthermore, since this is an online business, there are descriptions of how the website to the enterprise is to be designed, its features and what makes the website unique as well and by extension the merits this website has over those of potential competitors. Secondly, the paper also describes a business plan for the enterprise (Chen et al, 2009).
The financial plan is detailed or described in terms of the expected returns on the business, the ownership of the enterprise which is a limited company, the sources of the funding and how that capital will be spent and finally the volume of sales needed to cover both fixed and variable expenses. Briefly, this paper describes engages only into two major parts of the George’s Winery business plan which are the operations plan and the financial plan. George’s Winery is an online business (Karlsson & Honig, 2009).
Operations Plan
The website of George’s winery
This business is majorly an online business where customers or clients will have to place their orders online through browsing through the site that will be available for free access on the internet. The website will be designed in a manner that will enable it to display all the company’s products that are majorly the red and white wine (Chen et al., 2009). The website will operate in this manner. The willing buyer goes to the site and views the various brands of wine that are available together with their quantities and pricing (Karlsson & Honig, 2009; Zimmerer, Scarborough & Wilson, 2002).
After considering the various available products, the customer will select the available brands that he or she requires purchasing and the purchase option will appear (Chen et al., 2009). After clicking on the buy button, the customer will be necessary to feed in their credit card number as well as the location where they want the products to be shipped by the company (Pinson, 2008). After the system has ascertained that the customer’s credit card number has sufficient funds, then the purchase will automatically be competing and from that point on, the action cannot be reversed.
This website will be different from the sites provided by the competitors in that there are no extra charges incurred by the customer for using the site apart from the total cost of the purchases (Chen et al., 2009). This site will be unique in that after the customer has completed the online transaction, he or she will be allowed some time to make changes such as withdrawing the order or making changes to the quantities that they might have purchased (Karlsson & Honig, 2009). Another unique feature of the website will be that the customer will can view all the available products for free and contact the client service for further inquiries on the very website for free (Pinson, 2008).
The web operators
Georg’s winery is going to have on board four web workers on standby. They will work in the shifts of two with one group working at night and the other one during the day (Karlsson & Honig, 2009). They will be responsible for setting up and maintaining the website and responding to all the inquiries by the customers the operators will be required to be full-time employees each working at least 42 hours a week. Each one of them will be entitled to a monthly payment of $150 and a paid annual leave of 21 days annually.
These staffs will be competent in matters of web design and computer science for efficient operation of the website. These web operators are among the integral part of the human resource. They play the role of marketing, since all the sales will depend on the quality of the web designs (Karlsson & Honig, 2009). They too perform the customer service duties as they will be responsible for responding to all the customer service inquiries and updating the website frequently in terms of additional products, changes in prices among other product changes (Pinson, 2008).
Job Description
This segment defines the responsibilities that George’s Beer operational employees will perform throughout the year (Mason & Stark, 2004). The workers in the operations department will assist in the tasting room, with the bottling of the finished beer and the task of processing grapes. In the times of excessive work, the workers may be called upon to work part time so as to help in the process of bottling and beer processing so as to meet the market demand on time (Mason & Stark, 2004).
The grape processing during the initial year will be made up of the beer maker as well as the owner’s family. The three tasting room staff will commence in June 2015 when the Winery resumes for business. George will hold a one-week training session to discuss the ideal methods of serving the wine as well as the enlightenment of the workers on how to check for the correct identification (Mason & Stark, 2004).
The tasting room employees
- They will be charged with the following responsibilities:
- Enlightening consumers on the different wines
- Assist in the task of processing grape
- Serve the tasting customers with wine
- Promote the many wine events as well as the wine club
- Keep the equipment used to taste wine such as glasses clean (Pinson, 2008).
- Assist in the operation of the merchandise purchased together with running the cash register (Pinson, 2008).
- Assist in the operation of the mobile bottling unit.
Employee benefits package
Both full time and part time staffs will get a 12% discount on wine merchandise and a 13% discount on the purchases of wine. Upon retirement, the permanent full-time employees will the retirement package that will include the health insurance and a simple IRA contribution that is established by the company or winery (Mason & Stark, 2004).
Operations staffs estimate
George Winery is planning to bring on board four part-time wine tasting employees to serve at the tasting bar. These employees will be entitled to earn $10 per hour and work for averagely 12 hours every week. The estimates of the operations staff factor in a 5% increase in the cost of labor annually (Mason & Stark, 2004). These employees will be required to be on duty right from Friday all the way to Sunday when the winery is at the peak of its business. The owners together with the winemaker will run the tasting room when required during the week as from Monday all the way to Friday. The owners of George Winery will also assist in the tasting room operations during the weekends only when the circumstances dictate so like in the event of too much work (Pinson, 2008).
Scheduling
Below is the work timetable for each of the tasting room employees. The business plans to employ the students from the nearby tertiary institutions to seek (Mason & Stark, 2004). The fact that they are regular full-time students leads us only to allocate each one of them only 12 working hours every week to avoid overburdening them, which might lead to their inefficiency.
The workweek timetable
- Staff 1 11-7
- Staff2 11-7
- Staff 3 11-7ame Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Plan of Operations
George’s Winery will always be open all through the week from 9 am to 10 pm. From Friday all through to Saturday, the business will remain open all through the week from 10 am to 12 am midnight so as to accommodate any business meetings, weddings as well as other events that may happen at that time (Der Foo, Wong & Ong, 2005). The business electives to work during these hours since these are the days when numerous orders are placed online by our various customers since it I always on the weekend. Furthermore, the business is planning to make approximately 90% of its sales out of the tasting room that demands that the winery remain open to attract more customers (Mason &Stark, 2004).
Suppliers
The business will have contracts set up with local vineyards in the State of Illinois to buy the grapes to be used in the production process (Pinson, 2008). The winery will carefully choose vines that are synonymous with the production of high-quality vine grapes kinds that meet our product mix. The business will establish monthly meetings to view the grapes in the vineyards all through the growing seasons to inspect the crop. The company will buy the used equipment such as the fermentation tanks, crusher, as well as the membrane press from established and renowned dealers all over the country (Der Foo et al., 2005).
Production Process
Red wine making process
- In early October, the grapes are brought in their holding bins
- Bones are dumped into the crusher
- The grapes are crushed after removing from their stems
- The juice flow through the transfer line into the fermentation tanks and the fermentation process begins (Mason & Stark, 2004).
- The wine is racked after about four weeks to eliminate the sediment and skins
- The farmers to be used as fertilizers (Macmillan, Siegel & Narasimha, 1986) carry the by-products or rather the waste products.
- Three weeks later, the wine is transferred into an oak barrel container for the 8-10 months of the production process (Pinson, 2008).
- The wine is racked every 4-7 months to eliminate sediments
- The wine is then bottled and left for about 3-4 months in their bottles before being allowed into the market.
Bottling and Labeling Process
George’s winery will make use of the mobile bottling unit to do all the bottling process at the plant. The business will bear the expenses of the bottling unit operator subject to the number of the cases bottled to undertake the services at the winery (Der Foo et al., 2005). The tasting room workers will assist the procedure of bottling the wine, the owners of the winery and the winemaker (Abrams, 2003). The mobile bottling unit will fill the bottles, insert cokes in the cylinders, put capsules on the bottles, and finally put labels on the bottles. The rationale for us hiring the mobile bottling unit is that this will reduce the overhead costs since buying our bottling and labeling line is costly for the firm (Abrams, 2003).
Storage process
The business will build a processing, fermentation, and a storage facility on the premises to accommodate the winery (Der Foo et al., 2005). The initial level of this service will be where the processing and fermentation of the wine occurs. The next level will be used as a warehouse for the wine fermenting in oak barrels as well as for the storage of the bottled wine (Abrams, 2003).
Waste Management Process
The grape byproducts generated during the wine production will be placed into the picking beans (Chen et al., 2009). These will then be sold out to the local farmers within as farm fertilizers. The business will record the date of sale, the name of the producer, and the quantity of the byproducts sold out to follow Augusta County best practices of management (Abrams, 2003). The business will also fill the forms 5000.29 and 5000.30 with the TTB that deals with the disposal of the winery products.
Risk statement of George’s Winery
As a wine’s business, it is susceptible to both risks and opportunities.
Strengths
The business is located along a major highway with a traffic count of 1900 automobiles per day. There is consumer confidence in George’s Winery and the clientele has the willingness to try out the new wine products. The corporation has a good reputation in the State. The target market is the young generation who are lovers of partying and wine (Der Foo et al., 2005).
Weaknesses
The customers are not entirely aware of the winery and wine products offered. The management of the company has no prior skill of owning and operating a wine business. The price levels will be higher than those of the competitor’s ranges due to the high quality of the wine produced (Abrams, 2003).
Opportunities
- Since it is an online business, the market covered will be wider at a lower cost
- The company will open a mega restaurant at the winery to attract new customers
- The company will also offer festivals of wine on site to appeal to the target market
- There is also an opportunity of adding novel varieties of wine into the product mix (Macmillan et al., 1986).
Threats
- Legislations and regulations on the use of land and self-distribution
- Increased costs of inputs utilized in the production and packaging of wine
- Regulations on self-distribution and land use (Abrams, 2003).
Marketing Plan
Product
George’s Winery plans to produce three types of wines in the first two years of operation. The wines will be made from premier wine grapes to produce a unique wine. The primary market is young professionals and college students from the age of 21 to 32.
This age bracket is showing trends of becoming a wine drinking, but they are still not heavily marketed towards (Macmillan et al., 1986).
Secondary Market
The secondary market is retired wine consumers who are 60 years old and above. The largest, Therefore, George’s winery plans to attract an age bracket that consumes the most amount of wine per week (Pinson, 2008).
The Financial Plan
Like other plans suggested by Siegel and Siegel (2007), the financial plan for George’s Winery will contain a statement of underlying assumptions, sources of funds, and the break-even analysis.
Statement of Underlying Assumptions
- The Winery is projected to have an annual revenue growth rate of sixteen percent per annum.
- The George’s Winery will acquire $5,000,000 of equity funds to start up the operations of the company (Abrams, 2003).
- The management on a monthly basis will settle most short-term payables.
- The company may experience a decline in its revenue because of the financial and economic crisis that is facing the global markets (Pinson, 2008; Rich & Gumpert, 1985). Wine products are often regarded as luxury and are heavily taxed. As a result, there may be sluggish sales growth at one point, thereby affecting the revenues (Macmillan et al., 1986).
- The company will generate substantial gross margins to help it remain stable in its operations (Abrams, 2003).
- The interest rates, both long term, short term, Federal tax rates, the state tax rate and personal tax rates will remain relatively stable (Pinson, 2008).
Source of Funds
The Break Even Analysis
At the breakeven point, the total costs of operation are equivalent to the revenue. The projected revenue in terms of the months and yearly is expected as follows:
Ownership
George’s Winery will be an Illinois’ retailer of fine red and white wines (Abrams, 2003). The company will be formed and incorporated as a closely held limited liability company with three directors to begin with who will own eighty percent (Pinson, 2008).
Conclusion
This paper entails a business plan of George’s Winery. It narrows down to only two significant aspects that are the operations plan and the financial plan. George’s Winery is an online business that deals in the production and marketing of red wine, as well as white wine. This plan describes the operations plan in terms of the staffing, the production process, storage, the work schedule, the number of employees involved at each stage, the risk analysis statement in terms of threats and opportunities for this business.
Furthermore, since this is an online business, there are descriptions of how the website to the enterprise is to be designed, its features and what makes the website unique as well and by extension the merits this website has over those of potential competitors. Secondly, the paper also describes a business plan for the company The financial plan is detailed or described in terms of the expected returns of the business, the ownership of the enterprise which is a limited company, the sources of the funding and how that capital will be spent and finally the volume of sales needed to cover both fixed and variable expenses. In a nutshell, this paper describes engages only into two major parts of the George’s Winery business plan which are the operations plan and the financial plan. George’s Winery is an online business.
References
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