Business Plan of SAT

8/14/2019 Business Plan of SAT

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Business Plan

Student Assistance Team

Written By

Dan Tang

Juliette Guillou

Khawaja M. JawadXiao Zong

Junyao Wang

Jiqing Song

IEI Group 5

Tutor: Carole Couper

28 October 2013

MSc in International Business and Entrepreneurship

Adam Smith Business School

University of Glasgow



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Table of Contents

Executive Summary .................................................................................................................... 3

1. Description of the Venture ............................................................................................................... 3

2. The Management Team .................................................................................................................... 4

The Business Model ..................................................................................................................... 7

Competitor, Industry, and Consumer Analysis ..................................................................... 9

1. Industry Analysis ............................................................................................................................... 9

2. Porter’s Five Forces ....................................................................................................................... 10

3. SWOT Analysis ............................................................................................................................... 11

4. Competitive Analysis ..................................................................................................................... 12

5. Target Markets and Consumer Profile...................................................................................... 14

Marketing Strategy .................................................................................................................. 15 1. Build a community ......................................................................................................................... 15

2. Company and Service Presentation ........................................................................................... 15

3. Pricing Strategy .............................................................................................................................. 17

4. Partnership with Other Communities ....................................................................................... 18

5. Advertising and Promotion .......................................................................................................... 20

5. Web Strategy ................................................................................................................................... 21

Finance ........................................................................................................................................ 22

1. Initial investment ............................................................................................................................ 22

2. Start-up Costs .................................................................................................................................. 22

3. Sales Forecast .................................................................................................................................. 23

4. Expected sales .................................................................................................................................. 24

5. Income statement ............................................................................................................................ 27

Organization .............................................................................................................................. 28

Organization Structure ..................................................................................................................... 28

Internationalization .................................................................................................................. 29

Conclusion .................................................................................................................................. 32

References ................................................................................................................................... 33

Exhibits ....................................................................................................................................... 34

1. Essential and Serenity Packages ............................................................................................. 34

2. Sample of Web page ....................................................................................................................... 38

3. Operations Management .............................................................................................................. 38

Strategic Value Chain.................................................................................................................................... 38

1. Reception .................................................................................................................................................................... 39

2. Student Service ......................................................................................................................................................... 42

3. Transportation and Account Receivables......................................................................................................... 44

4. Information Systems ............................................................................................................................................... 45

5. Finance and Administration ................................................................................................................................. 47



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4. Questionnaire Survey .................................................................................................................... 48

5. Results of the Survey ..................................................................................................................... 51

Executive Summary

1. Description of the Venture

Problem

International students have been facing a lot of problems when they just arrived Glasgow.

For instance, they don’t know how to find an appropriate place to live after they leave the

airport; they start their trip without necessary things, especially those who come with just

some clothes; moreover, they become very unfamiliar with new learning styles as it is

difficult for them to acquire a totally new learning style in a short time, etc. Obviously, the

problems are diverse. Being new arrivals, international students fail to discover where

they can get help from and most of the student services that provided by the university

leave much to be desired.

Our solution

SAT (Student Assistance Team) born to help students with problems handling. It offers

students with a wide range of services to look after them from the day they arrive until the

day they leave. Students will be able to place order through telephone call, e-mail, or via

web. They can also request membership treatment by register online. Besides, SAT will

be organizing different events for its members during their stay, it is aimed to provide

more opportunities for them to meet people alike and to create greater social network for



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the coming year. By joining these events, they will be able to discover the city and the

Scottish culture through tours, trips, Highland dancing lessons, and tasting activities.

2. The Management Team

Tang Dan-Chief Executive officer

Miss Tang Dan receives a Bachelor degree of Business Administration from Khon

Kaen University International College in Thailand. She has a solid theoretical

foundation on business operation and experience of running small business in Asia

Sub-region. She came up with student service business idea at the first day when she

just arrived Glasgow. Currently, she is doing the Master of International Business and

Entrepreneurship at the Adam Smith Business School of Glasgow University. She is

excited about the opportunity of doing business within the European countries.

Juliette Guilou-Customer Service Department Director

Miss Juliette Guillou has been majored in Entrepreneurship within her Bachelor years

in France. With her background in business development, she knows what it takes to

successfully market and succeed in today’s start-ups. Aware of the importance of

understanding customer’s needs, she has planned the company’s service packages.

Juliette had some experience about how to build and conduct a business, so she is the

person in charge of negotiate with SAT’s partners such as universities, banks, estate

agencies and public transportation companies etc. There is no doubt that her

experience will enable her to manage the Customer Service Department with



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excellence.

Khawaja M. Jawad – Marketing Director

Mr Jawad Khawaja has done Bachelors in business administration with major in

Marketing from Institute of Management and sciences B.Z University and has several

years of experience in managing two outlets of Subway in Pakistan. He is very

experienced in market research, analysis and forecasting. Due to vast experience in

extensive promotion he has come up with many creative ideas about how to market

our company to more students and make it a brand in the future years. He understands

that marketing is not only about promoting the business but also identifying the needs

of the consumer before even the consumer knows it and then marketing the service it

requires doing so.

William Zhong-Accounting Manager

Mr Zhong used to study Accounting during his Bachelor degree. With four years

leaning experience, he will be the right person that in charge of the functions

involving money in the company. He will work closely with other members of the

management team on matters that can affect the financial health of the organization.

Junyao Wang- Reception Department Director

Miss Junyao Wang used to study in Germany as an exchange student for almost two

years during her Bachelor. Foreign experience made her become a wise problem



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solver and a good communicator. She will be the right person for leading the reception

team to deal with orders and inquires from customers.

Jiqing Song-Information System Director

Miss Jiqing Song got two Bachelor degrees of both English and International

Economy and Trade for Undergraduate Study. She has been carrying some work

experience on electric transformer online sales overseas. Will the previous experience,

she will be the right person that in charge of the information system, works smoothly

and provided effective support and assistance for other departments.



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The Business Model

Customer value position (CVP)

SAT provides a series of comprehensive services for students, especially for international

students. It fulfills their needs with a group of problem solver. Packages are offered upon

customers’ preference and accomplished by university and bank and estate agencies.

Additionally, those who carry a membership with the SAT will also be able to enjoy

discounts from other relevant services.

Profit Formula

Figure 1 Business Model



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SAT as a service-providing company, its primary profit comes from the service packages

that offering to its customers; secondary commissions from bank and estate agencies,

different kind of events it organizes, and transaction fees that charge for those who

buying/selling second and stuff on its official website. Furthermore, it also obtains space

for other business’s advertisement and sales promotion and organizes different events for

students.

Key Resources

Six international students from the University of Glasgow founded the company, with

total amount of £50,000 Equity. Each of them carries different business background and

fully understands the needs from their customers. Importantly, they have a lot of

experience in dealing different problems while studying abroad. SAT will set up

partnerships with other communities such as universities, banks, estate agencies, bars, and

restaurants.

Key process

Students will be able to know Student Assistance Team through the Internet or word of

mouth communication. SAT offers two different kinds of service packages online. The

person placing the order can either go online or pick up the phone and dial the company’s

number to order whatever they need. Student ’s inquiry will be allocated to particular

customer service team and then be served by at least one particular service

representatives.



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Competitor, Industry, and Consumer Analysis

1. Industry Analysis

SAT is in the student service industry. Included in this industry are universities and other

kinds of student based organizations. However, SAT keens to keep its unique positioning

in the minds of customers by increasing improvement in the standard of its services.

The advance of globalization offers students with multinational choices all around

the world. The international students today accept better services far more willingly

that was once the case. Continuously growth prevalence of studying overseas

generates a large portion of domestic demand.

Most of the existing students service unions leave much to be desired. Apparent

example is the International Student Support team of the Glasgow University, which

only provides limited advisory service for international students such as immigration

and employment.

Glasgow was ranked third for international student satisfaction among universities

participating in the International Student Barometer Summer 2012. There are more

than 17,000 undergraduates and 6,000 postgraduates from 120 countries worldwide

study at the Glasgow University each year. (Source from: University of Glasgow,

http://www.gla.ac.uk/about/facts/studentnumbers/)

http://www.gla.ac.uk/about/facts/studentnumbers/





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Total number of more than 23,000 undergraduate and postgraduate students means a

large potential market for investments, particularly in student service such as SAT’s.

Demand has kept pace and is escalating with respect to better services.

2. Porter’s Five Forces

Threat of potential Entrants – HIGH

Small capital investment paired with a simple business concept allow for

development of me-too companies.

Bargaining power of buyers – LOW

SAT is the first company that creates webpage offering a platform service

specifically for students and it is the first company that offers a systematic student

based services. This means that the business is very unique with big market potential.

Bargaining power of suppliers – VERY LOW

The transport’ service that SAT offers are available from other companies and i s

indistinguishable from one another.

Threat of substitutes - HIGH

SAT’s business concept is simple and can easily be copied by any similar service

provider.



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The services that SAT offers are available from the university and other agencies.

Competitive rivalry – MODERATE TO LOW

Unions such as Student Welfare Team threaten SAT during the summer pre-sessional

course of Glasgow University.

But the second hand stuffs that available on SAT’s website are students to students.

Normally they are not sold in other local second hand shops.

3. SWOT Analysis

Strengths

SAT is the first company in Glasgow that offers a coordinate process of student

services.

International students from the University of Glasgow found the company; they have

a lot of experience in international student’s problem solving.

The customer service representatives are multinational; they are very good at

communicating with foreign students.

The founder of SAT business is Chinese, it helps the company more advantage in

dealing with the majority of the Chinese students in Glasgow.

Weaknesses

No prior experience in the student service industry.



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Dependence on partnership with other communities.

Limited financial resources.

Opportunities

Extremely large potential market in Glasgow.

Expand partnership to other institutions.

Expand to other countries in Asia, e.g. China and Thailand — because the founders

have strong connection there.

Threats

The University of Glasgow may increase more staffs for student service.

Other agencies see an opportunity to get into the market using already existing

relations to compete.

4. Competitive Analysis

The Student Service Centre of the University of Glasgow, a small estate agency that

founded by a group of Chinese students, and the local taxi company are the major

competitors of SAT Company. According to informal resources based on our personal

network, we have interpreted some experience from other international postgraduates.

Consumer perceptions of service attributes are diagramed by SAT’s positioning matr ix in

Figure 2.

Of the aforementioned competitors, attributes of each are outlined below:



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Chinese Student Agency:

In operation since 2012

Very expensive

Low quality of service performance

In cooperate with local private estate agencies

Taxi Company

Difficult to book from overseas

Poor advertising

Known by the local people

More expensive than China

Takes time to wait

Student Service Centre

Too many students to wait for the queue

Do not open during the weekend

Provide limited number of services

Do not help students with finding accommodations



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5. Target Markets and Consumer Profile

Our company is targeting to international students and domestic university students. They

will be particularly responsive to our sales force strategy and our more Internet base

advertising strategies. Additional characteristics of these consumers are:

They have limited financial resources;

They use the Internet often;

They are active in social networks

They are very price sensitive;



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They are easily influenced by the media, friends, and perceived social leaders.

As regards, in order to overcome the treats from the external environment and convert the

weaknesses into strengths, SAT needs to come up with an effective marketing plan and

minimize the costs as much as possible. As our target customers are very price sensitive,

so the key of the business would be creating brand awareness with image of cost-effective

and service friendly.

Marketing Strategy

1. Build a community

Becoming a member of SAT means being part of a community. The company intends to

build a strong image and deliver its business concept among the university students: SAT

is a community that run by a group of university students, it will always do its best to

assisting overseas students to make their time hassle free, learning and fun.

2. Company and Service Presentation

1. Logo



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SAT stands for Student Assistance Team, the contexts aims to clarify that the company is

here for providing support and services, which are inclusive and accessible to students.

Our logo symbolizes that the business idea is pure and simple because we understand

whom we are working for and what kind of problem we are going to deal with.

2. Slogan

“Your problems, our solution”

The slogan comes from the consumer insight. We want to express that our company is

obligated to provide holistic pastoral care for our clients; we want to work as problem

solver, to come up with the best solutions, and too meet the needs of every customer.

3. Services

The experiment of being international students, allowed the student service team to

understand the difficulties that faced by studying abroad. In order to facilitate their stay,

the company comes up with a plenty of feasible services following their needs. There are

two packages: the essential pack and the serenity pack. For those who have registered, as

a member of SAT, will be able choose any of them (see Figure 2 Essential and Serenity

Packages. More detailed description of the services in Exhibit 4).



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3. Pricing Strategy

SAT opt for Cost-plus pricing, which means the basic cost for doing the services plus the

amount to represent the desired profit. Minimal profit margins will be allocated to each

service to determine the prices set forth by our competitors for similar services. Survey

results indicate that the majority of respondents are willing to pay between £200 and £400

for our services. By providing the consumer with the choice of different service package

options, the minimum amount will be charged for that service and no guaranty will be

required because some services will be made by a professional transportation company.

Pricing the service as competitively or more competitively compared other similar service

providers is necessary, because our target customers are students that with limited

financial source and very price sensitive. We hope that the perception from the beginning

will be that SAT is the friendly and cost-effective choice.



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4. Partnership with Other Communities

In order to bring students with the best service and being trusted, SAT realizes the

importance of having strong partnerships with other communities.

Banks

Opening a bank account is one of the most important steps for international students. But

normally it takes at least 6-10 days for the process and international students have to be

passive with the appointment arrangement. Thus, the student service team of SAT will be

in coordinating with both the Bank of China and the Bank of Scotland. It aims to provide

more convenience for international students through a way of being intermediary, to

reschedule the timetable more accurately, and make the progress more efficient for both

clients.

Estate agency

SAT will be working closely with the local estate agencies. The student service team is

committed to providing accessibility and reasonable accommodations to all the members,

it therefore spent a lot of time for researching agents that are experienced in selling

property and have a pool of potential buyer. It aims to make sure students are living in the

properties that meet legal and health and safety requirements (i.e. gas safety certificates)

and ensure that everyone meets her/his expectation and pay with the best price.



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University of Glasgow

The University of Glasgow is one of the most important partners for SAT. SAT strives to

provide coordinated services that are student focused and are integrated with those of the

wider University community. As for the university student satisfaction plays a vital role in

overall ranking of the school annually by guardian and other respected institutions. SAT

keens to work in partnership with academic staff, to provide professional, quality,

innovative, accessible services to students, and to foster a caring, positive, and more

unique campus environment.

In order to do that our team met with Students Representative Council (SRC). They are

happy to work together with SAT. SRC will be introducing SAT to the students, and they

said if anyone had faced a problem, which falls under SAT service portfolio, SRC would

direct them to SAT. In return, there will a special link on SAT’s official website, which

directed to SRC enquiry page.

Clubs/bar/restaurants

After a year when SAT has a proper brand image among university students, we will go

for the next step, which means to set up partnership with the local food stores and clubs.

Our partner will be providing discount to SAT members, and in return, they will receive

promotion services on our website. For example, there are two subways near the

University of Glasgow, one situated inside the GUU building and another located on the



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byres road. We plan to meet up the franchisee of the stores, to seek opportunities of being

partnership with him. By creating this connection, our member students will be getting 10%

discount for their consumption within the stores. In return we will provide them weekly

deals on our website and also send further discount coupons in our monthly newsletter to

our members. For a franchisee it is also an “in -store promotion” that helps him to increase

customer for the store.

5. Advertising and Promotion

Step 1:

In our initial phase of the business we don’t really need heavy investment for promoting

SAT. Our aim is to collaborate with University of Glasgow admission services, as soon as

students get unconditional offers, they will be given a unique email address contains their

student number. So our first step will be sending them an email to introduce who we are,

what we are offering, and why we are helpful, etc.

Step 2:

By collaborating with the SRC, we will have a huge boost in our promotion that made by

word of mouth communication. Normally, university sends emails to students before their

arrival, to inform them about what to expect and who to go for help. Additionally, they

will attach some links of different estate agencies. So it would be possible for us to ask the

university to attach a link of our webpage within the email.



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Step 3:

We will obtain a place during the Fresher’s Week, in order to get in touch with new

students. We will organize an information desk to welcome them and provide sign up

form for new member registration.

Step 4:

The success of our business requires good collaborations with banks and estate agencies.

In order to facilitate our plan of going international after 3 years, our marketing team will

be working on the development of relationship with multinational banks such as HSBC or

Barclays for the future.

5. Web Strategy

SAT web strategy is to make it simple and fun for the students. On homepage there will be

dialog box on top right corner for returning customers to login to their personal SAT space.

They will be seeing upcoming events calendar order for new service and track the status

of their second hand stuff (if they have ordered). (see Exhibits 1 Sample of Web page)

For new customers there would be a link to create new ID by entering their personal

details such as GUID or Uni email id. They will be able to upload a picture for their

membership card.

On the left site of our homepage would be links to our services, special packages and

also upcoming events.

There will be a link to “what is SAT” where there would be a brief introduction of



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the company, the management team, and brief message from the CEO.

On top there would be flash enabled advertisements allowed only of our trade

partners like subway and local food stores, clubs and bars. A moving ticker would be

installed above the toolbar where bus routes and timings would be shown, also

subway routes and important news about upcoming events and our email id for any

enquiries.

Finance

1. Initial investment

SAT’s more important initial investments are the creation of a website and the launching

advertisement which is incredibly important to a company’s customer outreach and

overall success. Startup marketing and branding are integral components of SAT’s

development because they will help the company establishing an individual brand identity.

SAT’s website is the company’s showcase: in the eyes of the consumer, a website is a

measure of viability and stability. SAT’s website will allow a good visibility of SAT’s

services and with entry costs reasonable at the entry level, it is the best tool to reach the

students.

2. Start-up Costs

The start-up costs for running the business are listed in Figure 4.



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Year 1 2 3

Rent 4,800 4,800 4,800

Business Insurance 1,500 1,500 1,500

Electricity/gas 840 840 840

Phone 600 600 600

Website maintenance 500 500 500

Hosting 100 100 100

Domain name 10 10 10

Advertising/Promotion 12,000 18,000 24,000

Marketing the website online 2,400 3,600 6,000

Transport taxi 12,450 24,878 37,316

Business trips 1,500 2,000 3,000

Salaries + wages 60,000 125,000 190,000

Total Cost 96,700 181,828 268,666

Figure 4 Expected Costs

3. Sales Forecast

In 2013 SAT sales will exceed £100,000 by serving more than 400 international students.

(see Figure 5)

Year 2013 014 2015



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Total Orders 415 829 1,244

Total Pounds (£) 116,460 230,915 345,735

Figure 5 3-Year Base Case Sales Projection

The three years projection is comprised of several calculations that consider the

following:

A sales forecast has been developed to measure the sales for the first year and yearly

for years two and three. The sales forecast has been used to help predict the

marginal profit by measuring revenue against expenses.

There are approximately 35% of the international students coming to study at the

University of Glasgow each year. A conservative forecast has been adopted to

increase the chance of meeting sale goals, in which the calculation of Anticipated

Demand is only contingent upon a proportion of 5%.

4. Expected sales

First, SAT’s primary revenues come from service packages. Based on the questionnaire

survey, it is indicated that 38% of the customers would prefer the “Essential package”,

whereas 62% of them would chose the “Serenity package” (see Figure 6-1 Total Expected

Sales of Essectial Package and Figure 6-2 Total Expected Sales of Serenity Package).

Figure 6-1 Total Expected Sales of Essectial Package



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Year 1 2 3

Number 203 406 610

Price (£) 200 200 200

Total (£) 40,600 81,200 122,000

Figure 6-2 Total Expected Sales of Serenity Package

Year 1 2 3

Number 212 423 634

Price (£) 250 250 250

Total (£) 53,000 105,750 158,500

Also, SAT is planning to build some partnerships with banks and estate agencies. Our

partners will give us commissions for providing them some new customers. We are

expecting a commission of 10 pounds per bank account opened and a commission of 50

pounds per housing contract signed. (see Figure 7-1 Total Bank Commission and Figure

7-2 Total Estate Agency Commission).

Year 1 2 3

Number of Bank Accounts 415 829 1,244



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10 pounds per Bank Account (£) 10 10 10

Total Bank Commission (£) 4,150 8,290 12,440

Figure 7-1 Total Bank Commission

Year 1 2 3

Number of Transaction 332 663 995

50 pounds per Transaction (£) 50 50 50

Total Estate Agency Commission (£) 16,600 33,150 49,750

Figure 7-2 Total Estate Agency Commission

Moreover, SAT’s second-hand stuff platform will bring to the company some revenues.

Each transaction done via our platform will be 5% of the total amount of the sale (see

Figure 8 Total Transaction Commission of Second-hand Stuff Platform).

Year 1 2 3

Number of Transactions 124 290 498

Estimated Amount of one Transaction (£) 50 50 50

Charge per Transaction (%) 5 5 5

Total 310 725 1,245

Figure 8 Total Transaction Commission of Second-hand Stuff Platform



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Finally, SAT will plan some events (2 per month from September to May) for its members;

each event will be at a fixed price of 2 pounds. (see Figure 9 Total Sales of Events)

Year 2013 2014 2015

Number of Events Per Year 18 18 18

Number of Expected Students 50 50 50

Price Per Person (£) 2 2 2

Tickets sales (£) 1,800 1,800 1,800

Figure 9 Total Sales of Events

5. Income statement

SAT is expected to gain £19,760 for the first year. Even the calculation is based on very

conservative estimations; the result reveals that the future of SAT business is optimistic.

(see Figure 10 Income Statement)

Year 2013 2014 2015

Expected Revenues (£) 116,460 230,915 345,735

Costs (£) 96,700 181,828 268,666

Gross Profit (£) 19,760 49,087 77,069

Figure 10 Income Statement

We understand that it takes time to establish a market presence and generate enough



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revenues to cover the initial costs of the investment. However, Situation analysis

considers several internal and external factors that affect sales projection figures.

Regardless, we have predicted that the factors may influence the sales of SAT for the first

year:

Factors of Best Case Scenario

SAT will earn support from the University of Glasgow and build up contractual

alliance with local bank agencies, estate agencies and other business organizations

such as Subway, increasing business support and awareness by word-of-mouth

communication.

Student service enthusiasts will be more concerned with the efficiency and

convenience that SAT is offering, causing them to be more receptive to customers.

Factors of Worst Case Scenario

Probability of more faultless service provided by the university equates to less

spending by students.

Organization

Organization Structure

SAT is a small new company; it incorporates as a general partnership company under the

regulation. Every founder of the company is taking part in different area such as Chief



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Executive Officer, Finance and Administration, Information System, Marketing, Student

Service, and Reception. Each department has its own specialized directions but all of

them are under collaboration, so that to ensure the company is operated efficiently (see

Figure 11 Organization Structure, for more detail about the Operations Management, see

Exhibit 3).

Internationalization

Making the move to take the company international is a watershed decision. With careful

considerations of time, value and economics, SAT will follow the method of master

franchise system that has been utilized and duplicated by successful companies who are

already in franchising worldwide. For international markets, its foreign partners who have

closer social network connection with the founders of SAT are screened and then upon



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partnering with the SAT Company, participate in a percentage of their performance in

developing a new system in their country. With this method, the system could focus on its

own domestic growth and momentum without trying to directly employ people in

unfamiliar markets.

SAT is planning to launch franchise sales overseas in the fourth year. In order to go into a

new market, the brand needed to fit the market and a great local partner needed to be

found. Thanks to the social network carried by its founder and fast growth of the

business, the company will be having more potential partners approach to carry the brand

international; it will demand an international assessment of the situation. Probably, in

order to find the perfect pairing of which markets to target and which partners to link up

with, the company will engage an international business consultant if necessary.

China — Beijing

Initially, it aims to create prospective partnership with a selected university in Beijing,

China. SAT profiles Beijing as the one that would adapt to its service model with a large

number of international students that have needs for this type of service.

Market overview

China is becoming one of the most popular countries that foreign students would like

to choose. In 2010, the total number of foreign students studying abroad whole year

in China reached 260000 people for the first time, while the figure of foreign



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students in 2009 was 30000 less than that in 2010 (Ministry of Education of PRC,

2013).

In 2008, more than 55000 overseas students came to study in Beijing, the capital city

of China. The figure of international students in Beijing accounted for near one

quarter among whole country (Ministry of Education of PRC, 2013).

Reasons to enter

Well public security environment and city management

High-speed development of economy and high degree of opening to the outside

world stimulate the inflow of international students.

Beijing, as the capital, offers various police advantages for international students,

i.e. large number of scholarship, rich in historical and cultural atmosphere and

heritage, greater science and education resources, etc. All of these make it more

attractive for foreign students to come.

SAT has stronger social network connection in China, as four of the founders are

Chinese.

Threats for Entering

Language and Cultural Barriers

Strong competitors like International Education Centers of Universities, which

also provides very attractive services to International Students.

Selected Entry Mode--Franchise



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Due to the different geography, cultural backgrounds, and economic conditions comparing

to Glasgow, SAT needs to adopt appropriate circumstance in Beijing. Regardless,

transactional cost theory suggests that non-equity modes of entry (franchise) would be

suitable for small firms where environmental uncertainties are perceived as to be high

(Brouthers, 2004). According to British Franchise Association (2013), the Chinese

government has supported the growth of franchising as it adds value to China in both

economic and social context. In addition, about 90% of all franchisees reported

profitability over the last 12 months and the most important is that, the major banks are

very supportive of good franchising, which is quite helpful for SMEs like SAT. Therefore,

the services offered by SAT in China will be slightly different from that in UK due to the

unlike situation, franchising would be a better choice to lower the risk and make the own

decision based on different markets.

Basically, SAT will be remaining similar series of services in Beijing. Besides, SAT will

provide some special services such as Chinese language teaching and learning, cultural

related lectures experiencing for overseas students that going to study in China.

Considering the demand of second-hand stuff may comparatively lower than Glasgow, so

SAT may close this session for Chinese market.

Conclusion

The idea of SAT business is simple, effective solution to the international students. We are



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addressing their needs to use an effective and inexpensive way to provide all the service

online. However, current alternatives do not address all requirements for providing this

service. Trends in the market indicate that SAT’s potential market is ripe to provide with a

group of student problem solving expertise. Our unique positioning will give SAT the

ability to become an well-known among university students in the future.

The marketing and operations management unify to meet the company’s critical success

factors of operational excellence. This is achieved through our marketing strategy and

cost-effective and efficient operation methods.

SAT is a low-risk project that practical for students who are looking for real

entrepreneurial experience. We hope that through our business plan, you have developed

the same enthusiasm and confidence for exploiting your potential entrepreneurship.

References

Brouthers, K. D., & Nakos, G. (March 01, 2004). SME Entry Mode Choice and

Performance: A Transaction Cost Perspective. Entrepreneurship Theory and Practice, 28,



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3, 229-247.

British Franchise Association. (2013). Join a Franchise: Advantages and Disadvantages of

Franchising.

(http://www.thebfa.org/join-a-franchise/advantages-and-disadvantages-of-franchising).

Accessed 20/10/2013.

Ministry of Education of the People’s Republic of China. (2013). International

Cooperation and Exchanges

(http://www.moe.edu.cn/publicfiles/business/htmlfiles/moe/moe_2813/index.html)

Accessed 20/10/2013.

University of Glasgow. (2013). About Us: Student Numbers

(http://www.gla.ac.uk/about/facts/studentnumbers/). Accessed 16/10/2013.

Exhibits

1. Essential and Serenity Packages

http://www.thebfa.org/join-a-franchise/advantages-and-disadvantages-of-franchising



http://www.moe.edu.cn/publicfiles/business/htmlfiles/moe/moe_2813/index.html











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Welcome bag

The welcome bag will include some goodies and some useful tools such as:

City maps

Major events of Glasgow

City travel guide...

Bank account

International students open a bank account for free and they will be getting:

A Visa International debit card

An access to their online banking

Phone plan

The Phone plan provides SIM cards and micro SIM cards. They are compatible with all cell

phones (even the most recent iPhones). The SIM card is activated ready for use.



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The students have the choice of two different plans:

Unlimited texts/100min call/Internet 3GB

Unlimited texts/300min call/Internet 1GB

They could have their plan terminated whenever they want and there is no minimum

duration.

Emergency contact

Our agency will be opened 6 days per week. In case of emergency, SAT would happily

allow students to make phone calls, send e-mails or via web. Moreover, SAT also prepares

a list of different health specialists (such as Gp & dentists) or hospitals with contact

information and map of location. In the case of serious health problem, one of the service

representatives will come and help student for going to the hospital.

Accommodation

Before the International students’ arrival, they would be able to select their place to stay

upon preference among 3 different options: a studio apartment, a flat-share or a homestay.

SAT has been working hardly on finding a good accommodation in order to meet

student’s expectations.

Second-hand stuffs platform

It is an online marketplace where former international students at the University of

Glasgow sell their reusable stuffs such as books, beds, desks and printers etc. to other



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students. Those seller could be able to post pictures with description of their goods, so

that buyer will be able to search and purchase directly via SAT’s website.

Airport Picking-up

The member students of SAT will be able to receive a pick-up service when they arrive at

the airport. One of the particular customer service representatives will be waiting in front

of the terminal station and to escort them into their new place.

Survival kit

The student service team of SAT fully understands how tired it could be after a long trip

and the stress of being in a new city. The survival kit is therefore provided in order to

facilitate international students’ arrival.

Daily monitoring

SAT helps students with daily issues such as translating, making a booking for

train/airplane tickets, taxi, etc. Students will be able to contact the student service team

via phone call, e-mail or web from every Monday to Saturday.

Job/internship searching

SAT also assists international students with Part-time job and internship searching within

or even outside the European countries. It works closely with the student service

department from the universities and to make sure that its member students are always



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updated with the newest up coming opportunities.

2. Sample of Web page

3. Operations Management

Strategic Value Chain

One of SAT’s strategic objectives is to focus on operational excellence to provide the

students with the most value at a competitive price while offering a variety of services. To

describe the value added in each process, we break down the ordering process into the

following areas: reception, student services, transportation and accounts receivables,

information systems, and finance and administration. The strategic value chain depicted in



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Figure 12.

The following alternatives have been evaluated using make-buy analysis considering

quantitative and qualitative factors to determine the ideal combination of process that

make up the value chain.

1. Reception

Reception department perhaps one of the most valuable areas for SAT company

because it will be the face to the customer, be it by phone or by Web. Initially, the

department will consist of Web editor and telephone operator. Web editor will be in



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charge of reviewing and releasing all orders that coming in via the Web; and telephone

operator will be dealing with offline inquiries from the customers, such as order

picking and provide outstanding call handling. The objective of the reception

department is to enable a better control of incoming calls and deliver more

personalized service to customers. Technology will play a large role in this department

because it will all be automated from the telephone queue and Web system, to finding

the answers to customer inquiries, to placing orders and allocating service.

Order Picking

Reception department puts the order together into Service Schedule electronically, at

which point service inquiry is allocated to exact customer service representatives. The

orders are placed in different service packages, which is also electronically determined

by the system. Once the order picking and place processing is complete, the order will

be configured manually with different customer service representatives and customer

will be informed with a timetable that indicates when and where they will be served

and whose responsibility is there to taking care of them.

Call Handling

Another function of the reception department will include, but will only limited to,

answering any inquiries the customer has regarding our services or processes

(ordering, payments, etc.), placing the order, and reporting any feedback from them.



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Financial Considerations

The cost of running a reception department is minimal because all that is required is

employee salaries and benefits as well as tools for domestic and international

communication. The total of these costs is broken down in Figure 13.

Year 1 Year 2 Year 3

Number of Receptionists 2 3 4

Wages £20,000 £30,000 £40,000

Equipment £1,430 £1,430 £1,430

Total £21,430 £31,430 £41,430

Figure 13 Reception Financial Considerations

Strategic Considerations

The Receptionist is the central point for communication within the company and

an important face to our customers and business-partners.

Web editor and telephone operator requires good skills in serving, computing,

and English language.

It is crucial to ensure that we have the best possible applications and tools to

handle internal- and external calls, so that to supervise switchboard efficiency

and be open for business around the clock.



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2. Student Service

SAT’s student service process is the core of company’s operation excellence. With a

group of problem solving expertise, it will make sure that the business is always

keeping close relationship with our costumers. The department of student service will

consist of several numbers of customer service representatives. The customer service

representatives will be separated base on the area that they are serving. For example,

Residential service representative will be helping students for finding new

accommodations and helping them move in/out from different apartment; some

service representatives will be assisting students with their visa application such as

consulting and documentary checking. There will be customer service representatives

who will be handling student’s emergency needs. At the head of each customer service

area will be a team leader. One analyst will be included in this department to

continuously provide reports and analysis on the performance of the customer service

representatives, to keep track of customer with issues such as nonpayment. The

customer service department will be headed by a manager who will oversea the

day-to-day activities and by a director whose responsibility will be align the

department with corporate strategies.


Though a complex to manage, the customer department is relatively simple for

budgeting; in addition to employee salaries and benefits, training and overhead are



43

included. Figure 14 is an outline of the costs that will be incurred.


Number of Employees 6 8 10

Wages £60,000 £80,000 £100,000

Phone £600 £600 £600

Business Trip £1,500 £2,000 £3,000

Office Material £130 £130 £130

Total £62,230 £82,730 £103,730

Figure 14 Cost of Customer Service


Customer service is considered as a core of operational excellence and needs to

be closely monitored.

Customer service also requires a large amount of manpower with skills in serving

and English language.

Relevant service know-how is very important for all the customer service

representatives, as they need to understand what the problems are, and how to

solve the problem.

Customer service is a delicate issue that must be supported by the dedication of

employees that are responsible, attentive and patient.

There are no companies in Glasgow that offer all these specific services to



44

international students. If this service is offered, it will be collaborating with the

universities, bank and residential agencies, and other stakeholders within the

community. It is should be a core competency of the student service company

that would be required to have international experience.

3. Transportation and Account Receivables

Services such as airport pick-up and accommodation moving will be loaded onto a

taxi or van along with other services to be provided. Depending on the types of

delivery that the customer has required, the transportation company is contacted by

the particular customer service representative and arrives ready for service placing.

The mission is considered complete when the driver receives cash or a check for the

transport, unless the customer has prepaid by bank card. Those who do not make

prepayment will pay directly to the drivers.


Financial considerations for basic transportation include the cost of transporting with

regard to location domestically. However, SAT will be outsourcing vehicle from other

transportation company, so the cost for SAT will only be employee wages (see Figure

15).


Transportation £12,450 £24,878 £37,316



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Figure 15 Transportation Costs


Reliable drivers who can pick up customers are required.

4. Information Systems

There are two main information systems that will play a decisive role in the

profitability of our company growth. It is important that the foundations of the system

are laid appropriately at the launch of the project to properly support the growth of the

company. The Transaction Processing Systems (TPS) and the Service Management

System (SMS) will be implementing over the time. Ensuring that orders placed via

customer service and the inquiries are handled in an efficient and timely manner. The

TPS will enable us to manage orders into different schedules. Customers select their

service schedule and date (the input), and the system updates the service available list,

removing those selected by the customers (the processing); the system then generates

a bill and a copy of the order (the output). The SMS will further allocate the tasks to

particular customer service representatives. Additionally, import systems that are

required are a full accounting system for budgeting, account payable and receivable,

and employee payroll. A full marketing system will also be required to ensure that the

marketing department has the tools required for market analysis and forecasting. The

website, and any internal information technology (IT) issues, will be managed by the

IT officer.



46


Figure 16 is a summary of the costs of information systems.


Number of Employee 1 1 1

Wages £10,000 £10,000 £10,000

Maintenance and Repairs £500 £500 £500

Total £10,500 £10,500 £10,500

Figure 16 Cost of Information Systems


The functioning of the company will be in conjunction with information systems

as its management tool.

It is vital to sustaining a good customer relationship and preventing service

overlap.

There needs to be quick turnaround for remedies to any issues that arise with the

information systems.

SAT needs to have IT officer in consulting that can handle all systems

simultaneously, ensuring proper alignment between all systems as well as

addressing any issues that arise.



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5. Finance and Administration

The financial and administration department of SAT are referred to as the soul of the

company. This department includes the chief executive officer and an accounting

manager. The company’s headquarter will be located in the University of Glasgow.

The reason for choosing Glasgow University as headquarter is that the founders of the

business are students from there; it is the central hub of student gathering; and it is

more convenient for us to reach other stakeholders such as university’s student service

center, bank and residential agencies, etc.


The costs of running the financial and administration office are relatively low since all

that required is employee salaries and benefits, overhead, and expenses for training

and networking. The total of costs is broken down in Figure 17.


Number of Employees 2 2 2

Wages £20,000 £20,000 £20,000

Office Material £130 £130 £130

Insurance £1,500 £1,500 £1,500

Office Rent £4,800 £4,800 £4,800

Water and Electricity £840 £840 £840



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Total £9,270 £9,270 £9,270

Figure 17 Financial and Administration Purchasing Considerations


The roles required to fulfill the financial and administration duties cannot be

outsourced to an outside entity.

4. Questionnaire Survey

Hello, we are students from the University of Glasgow and we are doing a short survey

about what kind of services that international students want to have when they are

studying abroad. We would like to ask you some questions about what kind of service you

would like to receive. It would be very appreciated if you could take a few mintutes to

answer it.

1. Nationality

2. Which qualification are you looking for?

Bachelor degree

Master degree

Doctoral degree

Other



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3. What kind of services would you like to receive?

Openinig bank account

Getting a phone plan

Emergency contact

Finding an accomodation

Airport pick-up

Helping guides (city maps, tours, public transportation, restaurants etc.)

Survival kit (pillow, duvet, sheet, a set of cutlery etc.)

Daily monitoring (booking taxi/train/airplain tickets, translating, advices

etc.)

Taking part in international events (scottish dancing, international food

fectival etc.)

Second-hand stuff platform access (handbook, desk, bed etc.)

All the services listed above

4. If you had the choice between these two packages of services, which one

would you prefer?

Essential package (bank account, phone plan, emergency assistance,

accomodation, second-hand stuff platform access)

Serenity package (essential package + survival kit, picking-up at the airport,

daily monitoring, job/intership search)

5. Which price do you think is reasonable for theses packages? *



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100-200 pounds

200-300 pounds

300-400 pounds

above 400 pounds

6. Which service(s) we didn't mention above would you like to find? If

this kind of students services business is going to exist, how would you agree

to purchase?

Absolutely yes

Yes

Maybe

No

Definitely not



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5. Results of the Survey

72%

23%

5%

Price Preference100-200 200-300 300-400

38%

62%

Package Preference

Essential Package Serenety Package



39%

54%

7%

Probability of Service Purchasing

Yes and Absolutely Yes Maybe No and Definitely Not

Nationality of Respondence

Chinese

French

Austrian

Indian

Japanese

Russian

Spainish

Thai

Business Plan of SAT

Documents

Transcript of Business Plan of SAT