Business Plan for Game Stock Exchange

This document is a business plan for Game Stock Exchange, a gaming retailer in the UK. It provides an overview of the business, including its aim, core services and products, management structure, target market, marketing strategy, operations and logistics, cost and pricing strategy, and financials. The plan outlines the company's objectives, competitive advantage, market research, competitor analysis, and cash flow forecast.

BUILD A BUSINESS

Contents
SECTION ONE: BUSINESS OVERVIEW....................................................................................1
Business summary..................................................................................................................1
Business aim and objective....................................................................................................1
Core services and products.....................................................................................................1
SECTION TWO: MANAGEMENT STRUCTURE.......................................................................1
Professional team skills..........................................................................................................1
Team member’s responsibilities and roles.............................................................................2
SECTION THREE: THE MARKET...............................................................................................2
Target market..........................................................................................................................2
Competitive advantage/USP...................................................................................................3
SECTION FOUR: MARKETING...................................................................................................3
Market research......................................................................................................................3
Competitor analysis................................................................................................................3
Marketing strategy..................................................................................................................4
SECTION FIVE: OPERATIONS AND LOGISTICS.....................................................................5
Set up costs.............................................................................................................................5
Monthly fixed cost..................................................................................................................5
SECTION SIX: COST AND PRICING STRATEGY....................................................................6
Margins...................................................................................................................................6
Mark-ups.................................................................................................................................6
Pricing strategy.......................................................................................................................6
SECTION SEVEN: FINANCIALS.................................................................................................6
Cash flow................................................................................................................................6
Plus 3-year forecast................................................................................................................7
REFERENCES................................................................................................................................9

SECTION ONE: BUSINESS OVERVIEW
Business summary
Gaming industry is one of the emerging industry not only in terms of entertainment but
also in terms of economic growth and development too ((Li, Gao and Li, 2012). as per Microsoft
approx. 2 billion gamers play games online and this number is enough to define the craze and
passion of youngsters behind computers and video games. In order to achieve an efficient
organisational plan, finding plans which are efficient in solving their problems and priorities
more efficiently is important for a company. There is a business plan proposed of construct a
Game Shop name “Game stock exchange” at Telford Road, Basingstoke, Hampshire, UK.
Business aim and objective
Aim of “Game stock exchange” is
 To become a best gaming retailer in the UK.
 To enhance trend among youngsters towards online gaming.
 To accomplish a sustainable and developed organisational structure.
Core services and products
The key products of Game Stock Exchange would be providing gaming consoles, play
stations like PS4, Xbox. Accessories as GTX graphic cards, gaming drives (CDs/DVDs),
gamepads and microphones. The shop will also provide the facility of subscribing games, online
playing gaming at fixed charged, rental services of play stations, seasonal passes.
SECTION TWO: MANAGEMENT STRUCTURE
Professional team skills
A team of professional and skilled team members are required in order to support the
business structure (Arachchilage and Cole, 2016). Collaborative strong analytical skills to
understand the complex business requirements and ability to work as part of a team are some
skills required in a team. The shop requires high quality skilled gamers who understand the basic
knowledge about new games and providing creative plans order to design the gaming structure of
the shop.
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Team member’s responsibilities and roles
Market research analyst: this will evaluate frequent research and study about the trending
games and playing stations available in the market. the key role of market research analyst would
provide the relevant facts and cost of introducing new gaming products in the shop (Rezaei and
Ghodsi, 2014).
Technical support Specialist: Specialists in technical support are the connection around
game companies as well as the audience. It employs data centres to assist clients with working
games and equipment problems. Support professionals respond to questions through telephone,
online communication and email.
Animator and sound artist: Sound artist and animators creates the sequence that create the
structure in such a computer game, along with the personalities and the climate, using cultured
software. The sound artist will analyse the quality of sound of different gaming versions.
Video game testers: This will keep checking new games and the game play in different
modes as easy, medium and hard. The role of game testers would be associated in providing
feedbacks and suggestions to customers and management authorities.
Marketing manager: The marketing manager will analyse the competitive environment
and suggest best possible ways to improve the structure of shop in appropriate format. The
marketing manager also analyse the budget for executing the marketing plan properly.
Sales representative: The sales representatives will promote the products and services through
online promotions tools, social media sources and spreading prototypes (Asgari, Afshar and
Madani, 2013).
SECTION THREE: THE MARKET
Target market
The target market mainly depends upon the type of game structure and requirements of
different type of gamers. It is observed that the industry for games is altering over period,
looking more closely into how the key trends of the sector are developing, such as the growth of
female players, and also how companies can efficiently aim this generation of gamers.
Youngsters, game developers and programmers, kids are the target audiences of the entity. The
age of targeted audience will be between 10-35 years.
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Competitive advantage/USP
The unique selling point of “Game Stock Exchange” would be providing multiple
sponsored gaming options to users. There will be various type of gaming options for different
age groups according to their type of game requirements. The product of different gaming
companies as Rockstar Games, Nintendo games, Activation Blizzard, Ubisoft, Gameloft, Rare,
Retro Studios, Sonic Team and LucasArt and EA games.
SECTION FOUR: MARKETING
Market research
During the market research it is observed that the cloud gaming or game on demand is one
of the emerging gaming service such as Play station and Gamefly. Specialised gaming consoles
and pods, processors and graphic cards for personal computers are being invested to boost the
level of gaming to next level (Pascua and Choi, 2014). The above start up business of Game
Shop have opportunities to take advantages of this advancement.
Competitor analysis
In recent times, the gaming manufacturing sector has also been immune to rising product
infiltration and growing customer preferences (Zhou, Li. and Bai, 2013). Development was
powered by exporting sales, driven by the weaker pound that boosted UK products ' price
competitiveness in foreign markets. The SWOT analysis subject to incorporating Gaming shop
in UK is done below
Strength
 Wildly successful for their product
lines at popular location in UK.
 Customer gratification by providing
required products achieved an elevated
level of public satisfaction among
new customers and new gaming market
to different gaming brands.
 The franchises of reputed gaming and
software companies robust distribution
network over the years that can meet
Weakness
 Choosing a significant area of gaming
industry is key weak point of
organisation in order to explore in
digital gaming.
 Slow in terms of recognising the
customer taste and specified gaming
requirements.
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most of its market potential.
Opportunity Opportunity to become a prime
distributer and retailer of online gaming
and cloud gaming services. Opportunity to take advantages of slow
economic growth of the UK in the
present recession duration and upkeep
the profitability for further growth and
development.
Threat
 The business may face litigation issued
in different markets-different laws and
constant volatility in all those regions
with respect to consumer quality.
 Strong competition–Over the past two
years, stable profits has expanded the
number of players in the industry,
putting pressure not just on profits as
well as on total sales.
 Liability laws are different in different
countries
Marketing strategy
An effective and practical marketing strategy is the key element to emerge the market share and
customer growth in industry (Andersson, 2012). High level of competition is the biggest
challenge in form of “Game Stock Exchange”. The shop owners who reap the benefits of them
will be going to get a big head start on their contest. For the past two years, the first advertising
phenomenon has gained momentum and will only get more important as time passes on. It is
constructed as video, of course. Publicizing a live signal was theoretically impossible for
everyone who only a few years earlier had no access to large workshop and a lot of backup.
Players eagerly waits for releasing of new games and gaming devices. Publishing short video
clips and previews can enhance enhance the customer interest towards new launchings. “Game
Stock Exchange” can publish these clips at stores to attract more gaming customers.
The most important aspect of such previews for several players is the real gameplay. If
buyers can see the game in motion. Organisation should organise some gaming events to boost
the sale figures of business. A sample for different gaming prototypes can also become a
supporting tool for business.
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SECTION FIVE: OPERATIONS AND LOGISTICS
Set up costs
Our initial investment for the Start-up is £35000. Considering some of the most relevant costs for
our gaming start-up, here is a list of Start-up as well as Fixed and Variable Costs:
Equipment Costs: £5000
Initial Incorporation fees: £450
Website Development Cost: £1000
Office Furniture and Fixtures: 5% of budget
Rent: £7000
Salaries: £8000
Server Cost: £360
Utilities: £2000
Interest Expenses: £380
Insurance: £2000
Transportation and logistics Costs: Variable
Direct Material: Variable
General and Admin Costs: Variable
Marketing and Advertising Costs: 0-8% of the budget
Monthly fixed cost
It is considered form the above 4 costs as just one time costs which is necessary for a
gaming business i.e. Equipment Costs which will include computers or laptops and other
necessary equipment’s to run a business, Initial Incorporation fees which includes legal and
regulatory costs, website development cost and basic office furniture and fixture for the
employees and office environment (Bathmaker, Ingram and Waller, 2013). The other costs like
Rent, Utilities, Insurance, Interest Expense, Salaries to employees and server costs are to paid
each year whether the business generate any sales or not. Last one is the variable cost of the
business that keep on changes with the level of production and increase in sales of the business
like Transportation and shipping costs, direct material cost, general and admin costs and basic
marketing costs to make people aware that we exist.
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SECTION SIX: COST AND PRICING STRATEGY
Margins
Margin Method is basically using your revenues and cost of goods sold to find out the
profit margin which we can charge (de Gortari, and Griffiths, 2014). It is anticipated that the cost
of goods sold would be 75% of the overall sales revenues. So, for our business profit margin is as
follows: (Revenues – COGS)/ Revenues) *100.
Mark-ups
Mark-up method takes into consideration profit and cost to calculate mark-up for the
product we are going to sell. Considering the product cost and other operations overheads the
cost of the product of Game shop would be marked up as follows;
(Profit/Cost) *100 = (9560 / 40440) *100 = 23.64%
Price = (1 + Mark-up) *Unit Cost = 1.2346*15 = 18.55 or £19
Pricing strategy
A primary strategy is to create compatible games on Facebook (Free to Play) to include the
name of the console game. In the games industry, they plan to leverage their brand recognition,
gain more customers to play important matches, and boost the stream of monetizing to raise
revenue. With assertive purchases for popular facebook or computer game studios, EA reacted
very rapidly in this virtual trend. Such games also offers free-to-play content, but also allows
users to access products like Dragon Age Legend(EA) in the main console game.
SECTION SEVEN: FINANCIALS
Cash flow
Particulars 2019
Cash inflows Amount (£)
Investment 35000
Revenues 15000
Total inflows 50000
Cash outflows
Start-up Costs:
Equipment Costs 5000
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Initial Incorporation fees 450
Website Development Cost 1000
Office Furniture and Fixtures: 5% of budget 1750
Fixed:
Rent Approx 7000
Salaries 8000
Server Cost 360
Utilities 2000
Interest Expense 380
Insurance 2000
Variable:
Direct Material 5000
General and Admin Costs 1500
Marketing and Advertising Costs: 0-8% of the budget 2000
Transportation and logistics Costs 4000
Total outflows 40440
Net cash flow 9560
Opening balance 0
closing balance 1500
Plus 3-year forecast
Forecasted cash flows
Particulars 2020 2021 2022
Cash inflows
Amount
(£)
Amount
(£)
Amount
(£)
Investment
Revenues 30000 35000 45000
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Total inflows 30000 35000 45000
Cash outflows
Start-up Costs:
Equipment Costs - - -
Initial Incorporation fees - - -
Website Development Cost - - -
Office Furniture and Fixtures: 5% of budget - - -
Fixed:
Rent Approx 7000 7000 7000
Salaries 8000 8000 8000
Server Cost 360 360 360
Utilities 2000 2000 2000
Interest Expense 380 380 380
Insurance 2000 2000 2000
Variable:
Direct Material 5250 5262.5 12000
General and Admin Costs 5075 1400 1400
Marketing and Advertising Costs: 0-8% of the
budget 5100 875 1000
Transportation and logistics Costs 5200 5260 5500
Total outflows 40365 32537.5 39640
Net cash flow -10365 2462.5 5360
Opening balance 1500 3150 4450
closing balance -8865 5612.5 9810
Form the above cash flow forecast it is considered that the start-up project will have to
bear negative returns subject to initial year. The cash flow forecast for 2020 states cash outflow
of -£10365, cash inflow for the year 2021 will be £2462.5 and cash inflow for the year 2022 will
be £5360.
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REFERENCES
Books and Journals:
Andersson, R., 2012. A game of risk: Boat migration and the business of bordering Europe
(Respond to this article at http://www. therai. org. uk/at/debate). Anthropology
Today. 28(6). pp.7-11.
Bathmaker, A. M., Ingram, N. and Waller, R., 2013. Higher education, social class and the
mobilisation of capitals: Recognising and playing the game. British Journal of Sociology
of Education. 34(5-6), pp.723-743.
de Gortari, A.B.O. and Griffiths, M. D., 2014. Auditory experiences in Game Transfer
Phenomena: An empirical self-report study. International Journal of Cyber Behavior,
Psychology and Learning (IJCBPL). 4(1). pp.59-75.
Li, X., Gao, L. and Li, W., 2012. Application of game theory based hybrid algorithm for multi-
objective integrated process planning and scheduling. Expert Systems with
Applications. 39(1). pp.288-297.
Arachchilage, N. A. G. and Cole, M., 2016. Designing a mobile game for home computer users
to protect against phishing attacks. arXiv preprint arXiv:1602.03929.
Rezaei, S. and Ghodsi, S. S., 2014. Does value matters in playing online game? An empirical
study among massively multiplayer online role-playing games (MMORPGs). Computers
in Human Behavior. 35. pp.252-266.
Asgari, S., Afshar, A. and Madani, K., 2013. Cooperative game theoretic framework for joint
resource management in construction. Journal of Construction Engineering and
Management, 140(3), p.04013066.
Pascua, P. N. Q. and Choi, Y. K., 2014. Zoonotic infections with avian influenza A viruses and
vaccine preparedness: a game of. Clinical and experimental vaccine research. 3(2).
pp.140-148.
Zhou, X., Li, Y., He, B. and Bai, T., 2013. GM-PHD-based multi-target visual tracking using
entropy distribution and game theory. IEEE Transactions on Industrial
Informatics. 10(2). pp.1064-1076.
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