CLEANERS, a service company established in 1999 offers waste management services to companies needing help with their waste management. Currently operating in USA, the company intends to expand its business line to Brazil, where it sees great business opportunity. Here it intends to provide its customers with COMPLETE CLEAN service under which Cleaners takes over the complete responsibility of managing company wastes thus completely relieving its clients. This is an innovative approach and the company aims to always follow the preset standards of controlling agencies and ISO 14000.
The company was established by five highly professional founders. Under their guidance the company gets the best insight of the industrial environment.
The company operates with the mission of ‘preservation of the environment’ and ‘satisfaction of its customers’. This is the reason why the company always aims to carry out such procedures which are ecologically correct to save nature. The company has always aimed to provide quality services to its customers and intends to carry out its further projects on same values and missions. Not only this, CLEANERS also aim to remain a profitable venture for its stakeholders.
The service range of CLEANERS includes waste management, waste disposal and waste collections. The company allocates a trained supervisor on the premises of the client, who supervises the process of collection, storage, deliver and disposal. The rejected materials by customers are sent to recycling companies and non-recyclable products are disposed off in a safe manner. All processes are carried in accordance to the laws and regulation of the operating company. The innovative venture of COMPLETE CLEAN provides a total package of all these services.
EXPANSION PLAN: OPPORTUNITY
The company now aims to set up the business plant at Mogi das Cruzes, which is 50 km northeast of Sao Paulo. It will initially provide its services to the city of Sao Paulo and its neighborhoods, an area that includes more than 30% of the Brazilian GDP.
After a market research, it became evident that there are approximately 33000 industries in the Sao Paulo area which generate approximately 50million tons of solid waste. Of all this, some are dangerous while others are non-dangerous and non-stable residues. Industries like Proctor and Gamble, Blindex, Sony, Mercedes Benz and Coke all produce tons of wastes in the form of wood, cloth, glass, paper, metal and plastic etc. All this provide an opportunity for our business services especially in the states of Sao Paulo, Rio de Janeiro, Minas Gerais and Parana. The growing industrial sector also provides future scope. On the basis of the research, CLEANERS aim to target such companies which have:
A global market presence
A large amount of residue coming up from their production process
Deep concern regarding its image.
The company aims to segment its market on the basis of residue generated and the type of industry like chemical, paper, metal, wood etc. This will allow the company to concentrate its resources on the main areas.
Brazil holds great success opportunity for CLEANERS as the Brazilian market is greatly booming. The country has obtained solid national economic growth and has a stable currency. Many companies world-wide are planning to invest in Brazil, showing future business prospects for us. Moreover, environmental cleanliness is an important agenda there and the industries and government are both greatly conscious about it.
The in-depth market research brought to light that the level of competition for CLEANERS will remain relatively low. There are no companies providing the waste management solutions the way we have proposed to. Most of the companies operating in this field only collect particular type of waste and carry their business operations on a small network. Few large companies working in this field collect the non-recyclable matter and domestic wastes. This is the reason why we believe that CLEANERS will be able to establish a strong brand name in the market because its COMPLETE CLEAN venture is very innovative in the particular market. Besides as the company is already working in this field of activity, it knows exactly what business procedures to follow rather than experimenting on raw ideas. In future the company also intends to join hands with strong waste processing companies which would also be profitable to CLEANERS.
However there are a few apparent business risks involved. This is because we will be the pioneers in this kind of a work. Besides this, the establishment is on the basis of demand assumptions as it is difficult to make correct sales forecasts. There is also a possibility of introduction of such work procedures and machines which help in reducing the waste materials. If this happens, it will definitely reduce our business but even this is sure that such technological innovations will happen with time and so the process will be slow and easy to identify.
It is agreed that the company’s initial investment of $300000 will be provided by its founder. The expenses and investments generated from the first year of operation will be absorbed by the positive cash flow and shareholders’ capital. However, the company intends to provide yearly dividends of 15% of the net income remaining after the deduction of taxes, from second year of operation. The company is well established in USA and is generating great profits.
Our budget for sales and marketing is approximately 3% of the total revenue. This will also cover expenses of advertisements, traveling and events. Budget includes the major initial capital expenses of:
1. Recycling and disposal plants
2. Installation of plants
3. Vehicle leases
4. Employee expenses
5. Waste transportation
6. Disposal fees
Major inputs are:
1. Cleaning revenue
2. Disposal and recycling fee
3. Consultancy fee.
It is the goal of the management to increase its clientele in Brazil. A sales forecast report made it evident that the company will be able to generate revenues of approximately 12% of total sales by the end of fifth year of operation.
The company is in the safe hands of five partners namely:
· Robert A. Wharton
· Shie Yoen Fang
· Dr. William R. Osgood
· Chichester W. Mathew
· Mike Harts.
They have knowledge in the fields of Engineering and Business Administration, Electronic Industry, Banking and Consulting, Telecommunications, and in areas such as Production, Process Engineering, Logistics, Information Technology, Quality, Project Management, Cost Accounting and Energy. Two directors will manage the company affairs in Brazil, however the other three will provide all the necessary assistance as and when required. All the five directors believe strongly in the importance of preservation of environment customer satisfaction.
There seems to be no constraints in setting up the plant at Sao Paulo. The government is environmental conscious and is supporting out venture. Not only this the existing companies have realized its importance and are trying to adapt their procedures according to ISO 14000. Our premises will be initially at 10,000 sq. ft., where we will have the following operational equipment: trucks, lift trucks, tractors, pressing machines, cranes, conveyors, buckets and scales. The availability of the vacant area near industrial centre has already been marked.
The brand name is chosen to be “CLEANERS” out of many other names considered. Since we provide the complete cleaning and waste management solution, it is believed that no other name could deliver the clear picture and service description of the job we are in. ‘CLEANERS’ is simple, appealing, concise, and meaningful fitting to the requirements of our prospective clients. The most important point to be noted here is that the cleaners is the team not the service, which means that when he client say ‘CLEANERS’ she would immediately get the picture of our team in his mind not our service, which is again inline with our strengths and core competency as we have highly strengthened and competent employees which make a team which understands its work very well and is expert, efficient, and effective.
CLEANERS, fundamentally is a service providing company which provides waste cleaning, waste collection, and waste disposal services to its corporate clients which belong to manufacturing businesses in Brazil. Therefore, it owns a fleet of trucks laden with equipments, tools, staff, and necessary emergency paraphernalia like fire extinguishers and oxygen masks. The teams will make visits to the industrial sites and collect the waste for recycling, or for the consumption that is not detrimental to the environment. The features also include the consultancy services and manuals for the industrial engineers to manage and minimize the waste internally; the way it can be preserved for the good or at least neutral for the environment following the ecological standards and structure.
Since “CLEANERS” is a service not a product so it does not have any packaging requirements. Nevertheless, the paints on cleaning vans, the uniforms/dresses of the teams would built and deliver the brand equity of cleaners that any product attempts to release as a part of its brand equity.
Service delivery is a pivotal issue in the business like cleaners; the Brazilian market seems to be conscious and sensitive towards the service, human correspondence, and the smooth and viable delivery of the output. Keeping in the mind these elements we have developed the service delivery chain which includes before sell correspondence and after sell correspondence to our clients and other stakeholders to satisfy and update them about the handling of the waste and to assure the quality of the services. The after sales services also include consultancy and correspondence about efficient and productive handling of the waste and the status of any certain client’s industrial waste if required.
The CLEANERS industrial waste management services provide complete after sell warranty for the ethical, harmless, and ecologically correct handling of the waste.
The style of service is based on the Brazilian soil and well incorporated with local norms, culture, and values. The service style is designed to position our company in the clients’ mind as a friendly, hardworking, and enthusiastic team of people dedicated with their work and aiming at the background issues of waste handling rather than earning profits only. So the style tends much towards a position of caring, socially responsible, and friendly service.
The prices are set in the light of the clients we are handling and providing services. There are many world renowned corporate organizations operating in that area including Sony and P&G. Our prospect clients produce waste in different forms including wood, cloth, glass, paper, metal and plastic. Now as per the pricing requirements of waste disposing companies and the cost recycling, we will set the prices accordingly. Since there are 33,000 manufacturing plants operating in the area we believe that setting a market penetration strategy would be better idea to capture the largest share of market. The penetration strategy is designed to be low cost-high turnover strategy allowing more companies to avail our services because of low cost and allowing us to increase market share and enjoy high profits because of higher volumes. Comparative analysis of both strategies show:
There is total of 50M waste produced in different forms. We prefer low profits – high volumes over high prices – low volumes strategy. Columns 2, 3, and 4 are in Millions
Credit and Discount:
Credit and discounts would be allowed to our well established clients with whom we have a promising prospective business on request only. The credit policy of “Cleaners” is also subjected to our end value chain costs and the turnovers. Due to low profit margins and rigorous turnover we may not be able to allow extensive credits or the flexible credit terms. However, this can be very systematically and pertinently offset with low prices, and service quality. Discounts will be allowed to major customers, who produce higher volumes of waste. All the discounts will be subjected to profit allocation client wise.
Those advertising mediums will be selected that directly address the corporate manufacturing clients in Mogi das Cruzes and that can earn more and more business. The advertising and promotion program includes following tools:
1. Word of mouth marketing
2. Participating and sponsoring government’s environment preservation programs
3. Arranging and organizing speeches by environment science experts.
4. Promoting industrial waste disposal programs.
It is very important to note here that since our target market is corporate not consumer so the conventional marketing and promotion channels are not of the use in our case. Television, radio, pamphlets, hoardings, billboards etc are not suitable. However the print media can be used and we plan to advertise and promote our service via internet and physical magazines, newspapers, and other literature targeting the manufacturing concerns in Brazil.
As discussed earlier the most pertinent media in the light of our target market and our offerings is print media.
Our focus is on environment protection and safe disposal/recycling of industrial waste. We position ourselves as a socially responsible profit making organization. Thus, our tagline or punch line will be designed strictly depicting the environment friendly image of ours’.
As per requirement our business does not need goods transfer, although it involves the transportation of waste burdens from the industrial sites to our plant, which of course need heavy pickups vehicles.
Our integral channel of promotion is our client itself; we believe in word of mouth promotion and by the time we are established in the midst of 33,000 industries we hope that our quality of service, low prices, and service satisfaction will bring our clients in the front end of our own company to promote and advertise and consequently make us earn more business by inviting other industrial manufacturers.
IMPLEMENTATION, EVALUATIONAND CONTROL:
‘Cleaners’ is objected towards following ISO 14000 standards strictly that points to pollution reduction and waste disposal/ managing priorities. Moreover, in the long term, we plan to develop our own code of conduct for corporate industrial waste producers in Brazil that will be developed in lieu of Brazil’s ecological environment, types of industries operating there, and the forms of waste being produced.
Performance measurement will be carried out by frequent inspection, internal and external, that whether the idealized standards are being followed or not, are the cleaning steps executed as per the planned design or not. If budget allows we may also hire an external team to scrutinize the performance of the business and quality of service.
‘CLEANERS’ has a profitable future. It will always provide services responsibly in accordance with the legal and environmental requirements. It will follow the procedures set by ISO 14000 and other controlling agencies. Therefore, we are confident that CLEANERS will be an attractive business that will bring excellent results in the following years.