STRATEGIC BUSINESS PLAN
for
Atlas Pearls and Perfumes LTD
TABLE OF CONTENTS
Executive Summary
Section Page
Strategic Focus
The Business
Market Analysis
4 Products
5 Marketing
6 Research and Development
7 Production and Delivery
8 Supply Chains
9 Business Systems and Processes
10 Stakeholder Relationships and Alliances
11 Organisational and Management
12 Environmental and Social Impacts
13 Risk Factors and Regulatory Compliance
14 Corporate Governance
15 Financials
16 Application of Investment Funds
17 Strategic Action Plan
18 Plan Improvement
Appendices:
1.
2.
3.
SECTION ONE
STRATEGIC FOCUS
The Aim of this Plan
The purpose of this corporate strategic plan is to properly define and capture the company’s strategy for entrepreneurship in general and global entrepreneurship in specific. This strategic plan seeks to address itself to the company’s unharnessed entrepreneurial potential. This plan aims to help to understand the current situation of the company so as to better understand how to set in place mechanisms for intensified entrepreneurial effort. The plan wishes examine the company products and services and business processes and systems as a foundation to planning a strategy for intensified entrepreneurship efforts by the company.
Our Mission
Atlas pearl sand perfumes Ltd endeavors to increase its work as Environmental Custodian of the Ocean, carer of local communities, discoverer of new pearl related technologies, to unlock the treasures of the South Seas for jewellery, cosmetics and beyond ( Atlas southsea pearls.com, 2013).
Atlas Pearls and Perfumes Ltd (ATP) operates a pearl production in Indonesia and distribution through company’s marketing operations in Australia. ATP also supplies mother of pearl, pearl oyster sea food products and perfume in retail markets in Australia. ATP is a key player in the beauty and apparel industry. ATP is a producer and dealer in luxury perfumes and cosmetics. Atlas is now not only a leading producer of pearls but also of processed natural ingredients for the fragrance and flavour market (BirkBeck, 2013). The company majors on eco-friendly pearl production to ensure the maintenance of environmental integrity.
Although ATP has grown significantly to become a renowned eco-pearl producer it has mainly limited itself to Australian markets. As such, an entrepreneurial approach would drastically expand its market base and make it a global supplier of pearls and perfumes.
Core Organisational Competencies
The past year has seen Atlas Pearls and Perfumes evolve from a seasoned aquaculture business into an ethical, sustainable producer of high quality luxury products. Diversification, sustainability and innovation have been key ingredients in the company’s growth strategy.
Highest Priority Goals
• .To intensify international entrepreneurship gaps in the company’s current strategy
• To set up plans to fill those gaps by setting up lucrative establishments in the line of the company’s businesses and in tandem with its mission.
• To draw up a coherent plan and timelines for the implementation of the above –stated establishments and entrepreneurial ventures.
• To set ATP up as a strong global market entrant so as to be able to compete with existing entrepreneur sin the global market.
• To expand the company’s resource base, to be able to meet a global market demands.
• To increase awareness and publicity of ATP so as to create brand loyalty in new markets.
• To map out a plan to ensure sustainable growth of new international entrepreneurial establishments to be set up.
• To expand ATP’s reach to wider consumer markets.
• To maintain stability of share values at the ASX.
Performance Objectives
The performance objectives below, in combination, form a performance scorecard for easily tracking the performance improvements generated by this plan. Section 17 provides the inputs for this scorecard. The planning team determines the composition of the performance scorecard.
Performance Area Performance Measures Target Time Frame
Financial Performance
Customer and Market Performance
Internal Efficiency and Effectiveness
Long Term Development and Innovation
SECTION TWO
THE BUSINESS
ATP is mainly involved in the selective breeding, nurturing and hence production of white and silver natural pearls. The company owns and operates several pearl farms. TP also manages the distribution of loose pearls mainly in Australia. The company also operates an in-house jewellery production business mainly using its retail outlets for business. the company mainly deal sin luxury goods, accessories and apparel.
Atlas Pearl sand Perfumes ltd is managed by Stephen BirckBeck (Executive director/Chairman) and owned jointly by its founders and stock holders. Joseph Taylor, Tim Martin and Geoffrey Newman support BirckBeck as non-executive directors in the company. Majority share holders include Timothy Martin (5.8%), WG& BM Martin (11.19%) and Raintree Pearls and perfumes (12.64%).
Atlas started its days as gold prospecting company Atlas Pacific Gold NL in 1987. In 1992 the company changed direction and moved into the exciting world of farming the only living gem and most precious of pearls, the South Sea pearl. Today, Atlas has an enviable reputation as a seasoned producer of pearls, specializing in the highly sought after quality South Sea white and silver pearls. The company’s pearling operations are located in the vast Indonesian Archipelago with farms in Bali, Papua, Flores and Alor (Atlas south pearl.com, 2013). Production of pearls is mainly done in Indonesia due to availability of southern seas. Marketing and distribution is however done in Australia as is the location of the retail outlets.
Atlas South Sea Pearl Ltd now Atlas pearls and perfumes Ltd has existed for 18 years.
the company actively engages in marine preservation efforts including continuous protection and rehabilitation of marine environment and providing a conducive enviroinment for the sustenance of biodiversity in its areas of operation.
Our new beautifully appointed perl’eco showroom is inspired by the ethereal world of the pearl. We hope to take you on a magical journey into the calm light, magnificent world of the mother of pearl and share with you a timeless jewellery collection that exudes elegance, femininity and class.
perl’eco symbolises a significant cross roads as the new face of Atlas, as we celebrate our pioneering heritage and look to our bright future as the global leader and innovative centre of South Sea pearl products and jewellery.
Past performance and key achievements
Key business advisors – Solicitor, Banker, Accountant, and Consultants
Relationships with key stakeholders
Competitive strengths and weaknesses
SECTION THREE
MARKET ANALYSIS
Global/National Trends, Developments, Cycles and Changes of Relevance
Macro-environment (eg, political, economic, legal, social/cultural, demographics, technology)
Industry
Markets, Customers and Suppliers
Competitors and their Products
Questions typically asked during the analysis would include:
– What are the industry’s economics, critical success factors, key risks, competitiveness, compliance and standards requirements, emerging trends and key technologies?
– Who are the key customers and major competitors in each target markets?
– What are the sizes of the target markets? Are they growing? If yes, at what rate?
– What market share does each major competitor hold in your primary markets
– What are the strengths and weaknesses of major competitors and their products?
– What are the competitive price points for products in each market?
– What competitive advantages must your products have to successfully enter and compete in target markets? How will you differentiate your products and add more-customer-value than competitors?
– Key questions about your primary customers:
* Specifically what need or problem does your product target?
* Who will make the decision to purchase your products?
* What are their decision criteria?
* Where are the products bought?
* How are the products bought?
* When are the products bought?
* Why are the products bought?
– How well do you know your primary customers and key competitors?
– How strong are your relationships with key customers and key stakeholders. How do you involve them in product development? What factors will be critical to building strong and enduring brands with them?
– What levels of demand for your products are realistic across your primary markets?
– In order of priority what are your primary markets? Why?
– How will your primary competitors react when you enter their markets, now and over the next two years? What are you going to do about their responses?
– What are the major barriers to market entry?
– What are the critical success factors for each market?
– What key product distribution, product support and customer service issues must be considered?
– Which companies and products are likely to become competitors in the future?
– What new or emerging technologies and substitute products are likely to become threats in the future?
SECTION FOUR
PRODUCTS
• current and near-future products?
• What gives your products a clear competitive advantage?
• What are the benefits and value provided to customer as opposed to ‘features’?
• What are the environmental and social impacts and implications?
What regulations, standards and codes must be complied with?
At what stage is each product in its life-cycle? For example:
– Research completed
– Prototype completed
– In-house testing
– Customer testing
– Market ready
– First up-grade completed
Also consider conducting the product analysis and planning for this section across the following stages:
Current Situation
Key Product and Market Issues
Key Strategies
Performance Measures and Targets
Research & Development
Research and development has been the cornerstone of Atlas’s achievements. A scientific approach to pearl oyster breeding and husbandry has seen Atlas produce quality crops consisting almost entirely of beautiful silver and white pearls.
Atlas has embarked on an ambitious long-term breeding and geneticists program with Australia’s James Cook University. Through developing a unique DNA pedigree, this project will further improve our breeding lines, increasing pearl quality and yield rates.
The plethora of research and development work accomplished by Atlas over many years is recognized by scientists around the world. Atlas researchers have presented their scientific findings at major international conferences in Europe, Asia and Australia and a number of key publications have appeared in leading scientific journals.
SECTION SEVEN
PRODUCTION AND DELIVERY
Provide a background to current activities. Then identify key issues – strengths, weaknesses, and gaps in production capacities and capabilities – as they relate to meeting the marketing requirements and targets, and R&D requirements developed in earlier sections. Then develop linked strategies with clear targets, time lines and budgets to develop and progressively expand production capabilities and capacities. All budgetary and financial constraints are factored in to this planning.
Key issues are typically identified following an evaluation of key production and delivery performance-drivers. Typical areas to be addressed during this evaluation include:
– Plant design, location, size and site requirements
– Access to key manufacturing technologies
– Production capacity and capability requirements
– Criteria for selecting contractors and suppliers
– In-house versus out-sourcing of manufacturing requirements
– The manufacturing and production standards, codes, regulations and OH&S requirements that must be complied with
– Equipment needs
– Inventory management
– Manufacturing processes – configurations and technologies
– Product and production costings
– Purchasing systems
– Quality control systems
– Manufacturing resources planning
– Material requirements planning
– Warehousing
– Scheduling and dispatch
– Material supplies and inventory
– Critical/key inputs to all manufacturing and production processes
– Risk management
– Key staffing and skills requirements
– Clear linkages to, and feedback loops with the company’s marketing, product development, and R&D functions
– Work systems and teams for staff
– Designing, testing and improving all production and delivery systems to meet market demands and expected growth
– Key performance measures and targets for controlling and improving all production and delivery systems to increase production efficiencies and effectiveness.
– Benchmarking and best-practice
SECTION EIGHT
SUPPLY CHAINS
Provide a background to current activities and list all key suppliers. Then identify key issues – strengths, weaknesses, and gaps in supply chain capacities and capabilities – as they relate to meeting the production and delivery requirements and targets developed at Section Seven. Then develop linked strategies with clear targets, time lines and budgets to develop and progressively improve supply chain capabilities and capacities. All budgetary and financial constraints must be factored in to this planning. Supply chains assessments to include out-sourcing. For example any R&D that is out-sourced should be included in this assessment.
Conduct the analysis and planning for this section across the following stages:
Current Situation
Key Supply Chain Issues
Key Strategies
Performance Measures and Targets
SECTION TWO
THE BUSINESS
Past performance and key achievements
Atlas also underwent a major transformation in the second half of last year. Our Board, with strong shareholder support, implemented a change in name and an expansion in operational strategy. We acquired a luxury “avour and fragrance exporter in Australia and invested jointly into World Senses with the expressed aim of linking the perfume and pearl luxury sales categories. Our strategy is to generate demand for value added pearls, realise higher margins on the production of pearls and, through product diversity, insulate ourselves from the cyclical nature of the traditional pearling business.
We continue to build on market-linked innovations and invest in high quality production with clearly de!ned speci!cations, consistent quality and pricing stability that meets or exceeds recognised standards. Through a corporate reputation as a preferred high quality producer of precious luxury goods created in natural and pristine settings protected by our Corporate Social Responsibility platform we will di#erentiate our company from the competition.
Perfume Division
Technical innovation allows us to link perfume into the pearl retail sector and is the cornerstone of our corporate strategy: generating
demand for value added pearls, realising higher margins and creating consumer demand for perfumes through the global retailjewellery sector. The geographic and product diversity of the new company gives us better productdiversi!cation and growth potential into the future
Investing in Increased Perfume Production
Atlas anticipates increasing the scale of perfume production in Tasmania to meet our strategic marketing investments. This will consequently provide a new stimulus for the Australian Island State.
In 2013, EOT will produce around 12,000 kg’s of Boronia “ower that will yield around 40 Kg of Boronia perfume concentrate selling for an average price of $9,000 per Kg. When we acquired EOT it had invested funds to build new farms projected to yield increasing harvests of 30,000 Kg of “owers and 100 Kg of perfume concentrate over 4 years. Atlas wants to double this objective by expanding Boronia production to the mainland using a transition from sustainable wild harvest to plantations over 5 years.
Atlas is also pursuing further strategic growth initiatives for other “avours and fragrances produced by EOT.
Relationships with key stakeholders
Competitive strengths and weaknesses
SECTION THREE
MARKET ANALYSIS
Conduct a detailed analysis across each of the following areas to identify and quantify key market opportunities/gaps, barriers to market entry, threats, compliance requirements, risks, performance multipliers, critical success factors etc that must be considered when developing high priority product development, marketing and business strategies. All budgetary and financial constraints must be factored in to this planning.
• Global/National Trends, Developments, Cycles and Changes of Relevance
• Macro-environment (eg, political, economic, legal, social/cultural, demographics, technology)
• Industry
• Markets, Customers and Suppliers
• Competitors and their Products
Questions typically asked during the analysis would include:
– What are the industry’s economics, critical success factors, key risks, competitiveness, compliance and standards requirements, emerging trends and key technologies?
– Who are the key customers and major competitors in each target markets?
– What are the sizes of the target markets? Are they growing? If yes, at what rate?
– What market share does each major competitor hold in your primary markets
– What are the strengths and weaknesses of major competitors and their products?
– What are the competitive price points for products in each market?
– What competitive advantages must your products have to successfully enter and compete in target markets? How will you differentiate your products and add more-customer-value than competitors?
– Key questions about your primary customers:
* Specifically what need or problem does your product target?
* Who will make the decision to purchase your products?
* What are their decision criteria?
* Where are the products bought?
* How are the products bought?
* When are the products bought?
* Why are the products bought?
– How well do you know your primary customers and key competitors?
– How strong are your relationships with key customers and key stakeholders. How do you involve them in product development? What factors will be critical to building strong and enduring brands with them?
– What levels of demand for your products are realistic across your primary markets?
– In order of priority what are your primary markets? Why?
– How will your primary competitors react when you enter their markets, now and over the next two years? What are you going to do about their responses?
– What are the major barriers to market entry?
– What are the critical success factors for each market?
– What key product distribution, product support and customer service issues must be considered?
– Which companies and products are likely to become competitors in the future?
– What new or emerging technologies and substitute products are likely to become threats in the future?
During 2012, Atlas changed its marketing and distribution strategy for loose pearls by holding fewer, larger auctions in Japan andHong Kong. This allowed more time for grading and better pearl presentation, which helped increase the selling price.Retail and wholesale jewellery revenue improved signi$cantly in 2012. This was due to the increased number of stores in Bali wherea new retail outlet in Sanur was opened in October 2012, a full years trading in the Perth !agship store and the opening of thewholesale division in the $rst half of 2012, which is selling the Perl’eco brand to the Showcase chain of stores in Australia
By increasing gross margin and reducing costs we were able to improve the return from the Retail division.
In 2013 we anticipate improving the gross margin further with substantially more sales in the second half, however, we must quicklyadapt to the changes in tourist and discretionary spending patterns. We are rapidly developing new product ranges in the Commodityand Mainstream categories to give our product o!er greater a!ordability, variation and excitement plus a wider appeal to the Asianmarket. We anticipate new productcategories, including ‘South Sea’ silver ranges, and cosmetics will be introduced prior to the end
of 2013. In addition we are focusing on improving and growing the retail business at our farm sites.
A new Mother of Pearl (MOP) processing facility has been built in Gerokgak, North Bali. The resulting crushed MOP is suitable for further extraction processes in Australia and Europe. We can now process all components of oyster by-products, including pearl meat for Export sales and internal supply.
SECTION FOUR
PRODUCTS
Based on the findings of Section Three identify your product’s key strengths and weaknesses as they relate to key market opportunities and threats. Then develop strategies to address each issue (eg, build on strengths and correct weaknesses) for each product in your product portfolio. When preparing this section consider the following framework for clustering key issues and related strategies. All budgetary and financial constraints must be factored in to this planning.
• Describe your current and near-future products?
• What gives your products a clear competitive advantage?
• What are the benefits and value provided to customer as opposed to ‘features’?
• What are the environmental and social impacts and implications?
• What regulations, standards and codes must be complied with?
• At what stage is each product in its life-cycle? For example:
– Research completed
– Prototype completed
– In-house testing
– Customer testing
– Market ready
– First up-grade completed
Also consider conducting the product analysis and planning for this section across the following stages:
Current Situation
Key Product and Market Issues
Key Strategies
Performance Measures and Targets
SECTION FIVE
MARKETING
Based on discussions at previous sections develop a concise set of highly focussed marketing strategies for your most attractive and highest priority markets. These strategies will guide your market entry, market development, and brand building activities. Establish budgets for these activities. Set realistic and measurable performance targets and time lines for each market
SECTION SIX
RESEARCH AND DEVELOPMENT
Provide a background to current activities. Then identify key issues (strength, weakness, gaps, threats and opportunities) and develop related strategies for addressing each key issues. Link the R&D effort to your market research, product development and marketing activities discussed in previous sections. All budgetary and financial constraints must be factored in to this planning.
Research and development remains a cornerstone of the company’s success and never more so since the acquisition of EOT. Atlas is
working in the following areas:
