Business Planning: Understanding the Catalytic Converter Market and Opportunities

In this document we will discuss about Business Planning and below are the summary points of this document:- Business concept: Developing and marketing Ned's Catalytic Converter for non-electric vehicles to generate clean emissions. Market overview: The UK catalytic converter market has a compound annual growth rate of 8.05% and is projected to reach $55.16 billion by 2021. Industry trends: The global market for catalytic converters is expected to reach $272.95 billion by 2024, driven by regulatory mechanisms and innovations in automobile manufacturing.

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Business Planning

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Table of Contents
1. BUSINESS CONCEPT............................................................................................................3
2. MARKETING..........................................................................................................................8
3. OPERATIONS.......................................................................................................................14
4. LEGAL/REGULATORY/INSURANCE MATTERS...........................................................22
5. FINANCIAL SUMMARY........................................................................................................23
References......................................................................................................................................27

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1. BUSINESS CONCEPT
1. BUSINESS OVERVIEW
Business (Value Proposition)
The business idea emerged from the observation of the growing impact of pollution in our
day-to-day lives (Mcgrath, 2014). The use of Catalytic Convertors is mainly observed to be in
used in vehicles that help in reducing the emission levels. Existence of components like
platinum, palladium and also rhodium in the catalytic convertors ideally help in tracking
down of pollutants that are generated by the exhaustion system of the vehicles (Saternus,
Fornalczyk & Cebulski, 2014). The Catalytic Convertor generated as Ned’s Catalytic
Convertor is taken to help the non-electric vehicles in generation of 100 percent fresh
emissions that would be totally free from the existence of harmful contents or pollutants.
Ned’s Catalytic Converter would be marketed in the UK market at a price range of GBP 300
to GBP 1500.
Need for the business activity
Overview of the Catalytic Converter Market in UK
In a report published during 2017, it is reflected that the market for catalytic converter in UK
has a compound annual growth rate of around 8.05 percent while the same is taken to reach to
a net worth of $55.16 billion by the close of 2021 (PR Newswire , 2017).
Market trends in the Catalytic Converter industry
The market trends in the catalytic converter industry on a global platform reflect that the

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projection for the market of catalytic converter products is taken to reach to a figure of
$272.95 billion by the close of 2024. This huge growth rate in the market for catalytic
converters is mainly attributed to the regulatory mechanisms of the different national
governments of different developed countries like United Kingdom and thereby their
institutional practices for controlling of automobile emissions along with new innovations and
changes brought about in the manufacturing of automobiles (PR Newswire , 2018).
Market size of the industry for Catalytic Converter in UK
The global market size of the catalytic converter industry in terms of market value is taken to
amount to $46.546 million by the close of 2018 while the same bearing a growth rate of
around CAGR 8.2 percent is taken to amount to around 79,772 million by the close of 2025
(Globe Newswire , 2019).
Key players in the Catalytic Converter Market in UK
Key global players that tend to effectively compete in the market of catalytic converters are
Faurecia SA based in France, Tenneco Inc. based in United States, Benterler International AG
based in Germany and Magneti Marelli based in Italy. Toyota based in Japan also tend to
potentially compete in marketing their catalytic converters to the automobile manufacturing
companies and other consumers in the global market (PR Newswire , 2017).
Selection of customer samples
Use of the stratified random sampling method is made for selection of around 100 responds
from two different consumer groups like the car manufacturers and also the direct consumers
in availing Ned’s Catalytic Converter. The use of the stratified random sampling method is
taken into use such that it would help in reducing the chances of emergence of errors

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associated to the application of the random sampling method and in carrying out research on a
focused basis (Whittington, 2015).
Consumer Surveys
Consumer surveys were carried out for the 100 respondents through the development of
structured questionnaire sets and thereby in carrying out surveys based on the use of the
online survey tool like SurveyMonkey. Telephonic surveys were also carried out where it was
difficult in gaining physical appointment and access to respondents.
Survey Questionnaire:
Name:
Age:
Marital Status:
Occupation:
Q.1. How much do you agree to the point that the use of catalytic converters in automobiles
restricts the level of emissions of harmful gases from automobiles?
A.1. (a) Totally disagree (b) Disagree (c) Indifferent (d) Agree (e) Totally agree
The responses received from the respondents to this question are reflected in terms of a pie-
chart produced as follows.

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2%
5% 3%
50%
40%
Use of Catalytic Converter in reducing emissions
of harmful gases
Totally disagree Disagree Indifferent Agree Totally agree
The pie-chart reflects that the majority of the business and non-business consumers of around
40 and 50 percent agree to the fact that the application of the catalytic converter adequately
helps in reducing the level of emissions of harmful gases from automobile exhausts.
Q.2. Would you like to try on a new catalytic converter that promises in generating total
purification from the harmful impacts of the toxic gases for the non-electric vehicles?
A.2. (a) Yes (b) No (c) Indifferent
The responses gained from the respondents are tabulated in an excel sheet and reflected in
terms of pine chart rendered as follows.

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Yes No Indifferent
0%
10%
20%
30%
40%
50%
60%
70%
70%
20%
10%
Total purification from the harmful effects of
toxic gases
The above graphical illustration shows that majority of the respondents of around 70 percent
are interested in switching over to a new catalytic converter that would help in generating
total protection from the impacts of harmful and toxic gases generated from the exhaust pipes
of automobiles. Around 20 percent negate to the fact of switching over to a new alternative
while 10 percent remain indifferent to the suggestion.
Inferences gained from the above surveys along with the facts and figures concerning the
catalytic converter market reflect the market need for Ned’s Catalytic Converter and thus
aims at effective business opportunity for the new venture.

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2. MARKETING
1. IDENTIFICATION OF CUSTOMERS AND MODE OF REACHING
THEM
Customer
Profile
Reason for
targeting
them
Manner of
gaining
attention
Manner of
convincing
them
Specific
activities
that are
needed to be
carried out
Level of
spending for
the different
activities
1. Buyers of
New Cars
The
consumers
that are
interested
in buying
of new cars
are mostly
observed to
be
interested
in sports
and are
mostly
interested
in surfing
for racing
cars that
would help
The product
Ned’s
Catalytic
Converter is
relevant to
this
customer
group in that
they focus
on gaining
access to
sophisticated
and
innovative
technologies
in terms of
switching
over to new
automobile
models and
branded
The use of print
media,
advertisements
in terms of half
and full page
ads can be
generated for
newspapers and
car magazines.
Advertisements
of specific slots
are required to
be made for
both the
television and
radio for
generating
greater appeal
to the target
audiences.
Likewise
The sales
managers in
order to
convince
customers
are required
to
potentially
highlight on
the technical
features and
benefits
behind
installing the
Ned’s
Catalytic
Converter
which would
help the
customers
understand
Different
types of
activities can
be organised
by the
business
managers for
rightly
appealing to
the
consumers.
-Generation
of workshops
for educating
customers on
benefits of
the product
-Effective
Public
Cost of
generating
workshops:
GBP 800
Cost of Public
Relations:
GBP 900
Cost of
Customer
Servicing
GBP 500

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in meeting
their sports
drives.
These
groups are
generally
married and
have kids.
Annual
income of
such
households
tends to
range along
GBP
30,000 to
GBP
50,000
(Experian
Limited ,
2012).
cars. tabloids and
other outdoor
advertising
activities are
required to be
carried out
enhancing
greater
visibility
(Bischoff, 2017).
the specific
advantages
they ought
to gain from
using the
product.
Need
matching
strategies
would help
in
convincing
the
customers to
try on the
products
(Bly, 2018).
Relations
-Developing
customer
contact
points for
rendering
effective
customer
servicing.
2.Consumers
concerned
more with
emission levels
and Carbon
Dioxide
emission
The second
customer group
This
customer
group is
observed to
be an ideal
group for
marketing of
the value
proposition
for Ned’s
Along with the
development of
advertisements
meant for
television and
radio the social
networking
platforms like
Facebook,
Twitter,
For
convincing
customers to
try the
product the
management
needs to
generate
some rebates
and coupons
Different
activities like
booking of
venue spots
like that of
automobile
stores,
generation of
invitation to
customers
GBP 100
needs to be
expended for
booking of
venues for
demonstration
of the
catalytic
converter to

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relates to
Ethical or
Green
customers that
focus on
conveniently
choosing of
products that
tend to
generate lesser
or no harm to
the society and
environment.
These
customers
generally focus
on visiting of
departmental
stores for
gaining of Fair-
trade
merchandises.
The ethical
consumers are
most likely to
be married and
have kids
which in turn
make them
more conscious
about
Catalytic
Converter.
The use of
the catalytic
converter
would help
the
customers
associated to
this group
for meting
their ethical
objectives.
The new
catalytic
converter
would be
liked by
them in that
the same
helps in total
purification
of the
environment
from the
harmful
effects of
toxic gases.
YouTube,
Instagram and
Pinterest
among others
are meant to be
used for
reflecting the
product usage
and benefits
and
testimonials of
customers in
the form of text
and video
posts.
Electronic mail
can be used for
sending of
mailers directly
to customers
while outdoor
media would
be used in the
form of digital
signboards for
advertising the
product
(Gebrekidan,
2017).
such that the
same would
help in
attracting the
consumers
in trying the
product.
through
emails,
developing
of
presentations
and likewise
need to be
constituted
for
introducing
the product
to the
customer.
customers.
Cost of guest
relations and
presentation
would cost
around GBP
70.

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purchasing and
using the right
product
(Anderson,
2015). The
salary ranges
from GBP
15,000 to GBP
25,000 for this
customer group
(Anderson,
2015).
3.Consumers
involved in Car
rental business
Customers
involved in car
rental business
tend to vary
along age
groups ranging
from 25 to 40
years. They are
both family
and non-family
customers.
Average
income of
these
customers
These
customers
being
offered with
catalytic
converters
would be
able to add
value to their
customers
for reducing
the amount
of harmful
emissions
(Hills, 2017).
Use of print
media like
generation of
catalogues,
pamphlets and
also
advertisements
in newspapers
and magazines;
development of
advertisements
for television
and radio;
digital
advertisements
through use of
apps, electronic
newsletters and
social
Attractive
packages
can be
designed for
helping the
car rental
customers
avail the
benefits of
the Ned’s
Catalytic
Converter.
In that the
venues can
be pre-
selected as
the garage or
venues of car
rental firms
so only focus
needs to be
carried out in
making the
presentations
for educating
the
customers
about the
benefits of
the catalytic
It would cost
around GBP
40 to GBP 50
for
development
of
presentations
that would
help in
providing
needed
information to
the car rental
customers.

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tends to be
GBP 30,000 to
GBP 50,000.
networking
platforms need
to be carried
out in an
extensive
fashion
(BizPlanDB,
2014).
converter.
2. COMPETITORS
Competitor
profile
Basis of
competition
Reasons for
customer
dependency
Manner of
attracting
customers
Specific
activities
needed to be
done
Cost of
spending on
each activity
1.BASF
A Public
Company that
caters to the
need of
automobile
customers for
catalytic
converters for
around 36
years.
The basis of
competition
with BASF
would be
quality
parameter for
the catalytic
converter.
Customers tend
to depend on
BASF owing to
its large scale
offerings of
catalytic
converters.
Advertisements
need to be
generated
along various
mediums for
highlighting
the efficiency
of catalytic
converter in
generating 100
percent pure air
free of
-Generating
videos
reflecting
customer
testimonials
for use of
catalytic
converters.
-Development
of
presentations
-Cost of
producing
videos can be
GBP 40
-Cost of
developing
presentations
would be
around GBP
50

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pollutants. that can be
shown in
venues of
automobile
dealers.
2.Johnson
Matthey
The company
focuses on the
generation of
sustainable
solutions in the
field of
environmental
technology. It
focuses on
investing in
Research and
Development.
Competition
would be
carried out with
Johnson
Matthey based
on product
features for
catalytic
converters.
The generation
of innovative
product
solutions
regarding
catalytic
converter helps
customers in
enjoying value-
added benefits.
Customers can
be attracted in
terms of
highlighting
the features
and
efficiencies to
be gained from
use of Ned’s
Catalytic
Converter.
-Generation of
customer
meets
-Providing
demonstration
s of catalytic
converter
-Cost of
booking
venues for
customer
meets and
product
demos would
be GBP 80.
3. CATALE
R
A private
firm that
specialises
Competition
with
CATALER
would be
carried out
based on price
CATALER
provides
different types
of product
solutions in the
field of
Customers can
be encouraged
to switch over
based on the
incorporation
of discounts
-Carry out
promotional
activities along
car dealership
venues
Investments
of around
GBP 200 TO
GBP 300
need to be
expended in

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in
generating
diverse
catalytic
converters
for
different
sectors
(Business
Wire ,
2017).
points for
attracting
customers.
catalytic
converters that
attract
customers.
and price
offers.
-Offering of
digital
coupons
this direction.
3. OPERATIONS
1. CARRYING OUT THE PRODUCTION OF NED’S CATALYTIC CONVERTER
How, When and Where to produce Ned’s Catalytic Converter
Ned’s Catalytic Converter would be manufactured in production centres based on the
orders gained from customers through generation of tenders.
Manner of getting supplies
-The supplies of ceramic and metallic cores can be gained from Morgan Advanced
Materials.
-Corporate members of British Plastic Federation can be contacted for procuring titanium

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and aluminium dioxide.
-Baird and Company Bullion Merchants acts as an active supplier for Rhodium and
Platinum.
Supplies and Equipments needed
-Need for ceramic and metallic cores where latter is less expensive
- Materials like Titanium, Aluminium and Silicon Dioxide are used singly or in
combination for developing the catalyst washcoat
-Precious components like palladium, rhodium and platinum are used for catalysts
(Thomas, 2013).
Transporting supplies to production site
Contracts can be carried out with logistic firms for supplying of materials to the
production site.
Manner of despatching finished products to customers
Finished Ned’s Catalytic Converters can be reached to the consumers based on reaching
the same to wholesalers of catalytic converters and other automobile dealerships that sell
branded non-electric cars.
COST DETAILS ESTIMATED COSTS
Delivery of products to customers
Catalytic converters can be reached to customers through
involvement of automobile dealers and other online retailers.
Cost of retailing catalytic
convertors would range
from GBP 400 TO GBP
800.

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Quality control process
The quality control process needs to be carried out through
incorporation of Euro 6 Standards that help in monitoring of
pollutant emission with needed precision. Similarly, Worldwide
Harmonised Light Vehicle Test Procedure or WLTP would also
be used for testing of emissions from vehicles along different
conditions in real-life situations known as Real Driving
Emissions or RDE (SMMT, 2016).
The costs of the quality
control process would
enhance the operational
costs by GBP 8,000 to GBP
12,000.

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(SMMT, 2016)

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(SMMT, 2016)
Payment processing
Cash and Credit cards would be accepted from customers for
making of payments for purchase of Ned’s Catalytic Converter.
The total cost to be incurred
associated to the payment
modes would range from
GBP 5,000 to GBP 16,000

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2. STAKEHOLDERS
List the stakeholders Issues with Stakeholders Costs Incurred
1. Production and Office staffs The employees and staffs
may tend to resist changes
regarding production
technology, business and
operational policies (Ryan,
2016).
Training costs of around GBP
200 would be incurred for
training of employees
regarding use of new
technology and business and
operational policies.
2.Managers Managers tend to face issues
with time management, staff
motivation and also in
fulfilling of business and
institutional objectives in
new technological
environment (Lipman, 2015).
Herein, also training needs to
be imparted for enhancing the
skill and knowledge base. Cost
of managerial training would
be around GBP 300.

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3.Suppliers Different types of issues like
faulty or sub-standard
supplies of materials and
payment related issues may
tend to emerge (Sadgrove,
2015).
Supplier integration and
monitoring based on use of
ERP systems and monthly
meetings would cost around
GBP 120,000.
4.Customers Cases of customer
dissatisfaction and increase
in customer complaints
would tend to affect the
market for the product
(Kymal, 2016).
Training costs of around GBP
400 is required to be expended
for imparting training
regarding complaint
management and enhancing
customer satisfaction to the
customer service staffs.
3. PRICING
Product Price Reasons for price setting Price compared to
competitors
1.Oxidation Catalyst
Catalytic Convertor
GBP 1500 Price setting is lower
than the market rate for
attracting more
customers.
GBP 2000
2.Dual-bed Catalytic GBP 700 Setting of low price GBP 1000

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Convertor would help in greater
market penetration.
3.Three-Way Catalytic
Convertor
GBP 1200 Setting of below average
prices for catalytic
convertor would enable
greater consumer
attraction.
GBP 1500
4. SALES-QUANTITY
Product Predicted sales
over 6 months
Timeframe Notes:
1. Oxidation Catalyst Catalytic
Convertor
490 Half-Yearly This catalytic convertor becomes
able to eradicate only a fraction
of the pollutants and thus faces
challenge in densely polluted
regions.
2. Dual-bed Catalytic Convertor 175 Half-Yearly The price being lower than
oxidation catalyst and being able
to work more efficiently it earns
greater demand in the market.
3. .Three-Way Catalytic
Convertor
234 Half-Yearly This device turns out to be highly
efficient in that it becomes able
to transform three harmful

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pollutants in one-go and is also
economical than the previous
ones.
4. LEGAL/REGULATORY/INSURANCE MATTERS
Needs Associated costs?
Need of licences
No need of licences are observed for manufacturing
of catalytic convertors in United Kingdom
NA
Legal Requirements
The catalytic convertors are required to effectively
pass through a series of strict emission tests before the
same can be marketed to consumers in United
Kingdom (Hills, 2017).
GBP 9000
Insurance need
Protection associated to health and safety stands as a
significant need for the people working in business
related to the production of catalytic convertors (Hills,
2017).
GBP 3000
Intellectual Property GBP 10000

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The company can file a Patent Application associated
to the production of different types of catalytic
convertors (Hills, 2017).
5. FINANCIAL SUMMARY
1. SET-UP – LIST ACTIVITIES
BELOW
TOTAL COSTS OVER 6
MONTHS
Cost of generating workshops GBP 2000
Cost of Public Relations: GBP 3000
Cost of Customer Servicing GBP 2500
Booking of Venues GBP 1600
Cost of maintaining Guest
Relations
GBP 1000
Development of Presentations GBP 500
Legal Requirements GBP 9000
Insurance need GBP 3000

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Intellectual Property GBP 10000
TOTAL FOR SET UP GBP 32600
2. OPERATIONAL – LIST ACTIVITIES
BELOW
TOTAL COSTS
OVER 6
MONTHS
Delivery of products to customers GBP 800
Quality control process GBP 12000
Payment Processing GBP 16000
Training Costs GBP 2000
ERP Implementation GBP 220,000
TOTAL FOR OPERATIONAL GBP 250,800
GRAND TOTAL SET-UP + OPERATIONAL OVER 6 MONTHS GBP 283400

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3. SALES PROJECTION FOR SIX MONTHS
ITEM PRICE
(GBP)
1ST
MONTH
2nd
MONTH
3rd
MONTH
4th
MONTH
5th
MONTH
6th
MONTH
TOTAL
1.
Oxidation
Catalyst
Catalytic
Convertor
1500 67500 75000 90000 157500 180000 165000 735000
2. Dual-
bed
Catalytic
Convertor
700 17500 14000 21000 17500 24500 28000 122500

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3. .Three-
Way
Catalytic
Convertor
1200 48000 42000 45600 48000 43200 54000 280800
Total of
Six
Months
1138300
PROFIT AFTER 6 MONTH PERIOD: GBP 1138300 – GBP 283400 = GBP 854900

27
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