Australian Organic Soaps Business Plan

This report presents a detailed business plan for a new Australian business venture, 'Australian Organic Soaps Limited,' focusing on the production and marketing of premium organic soaps for men ('Eastern Brown') and women ('Snow Petrel'). The plan covers various aspects, including market segmentation (targeting middle and upper-class consumers), value proposition (high-quality, organic ingredients, luxurious experience), customer relationship management (communication through various channels), supply and distribution channels, key activities, resources, and partnerships. A comprehensive feasibility analysis is conducted, examining market, technical, human resource, and financial aspects. The report concludes that the venture is feasible, highlighting the potential for growth in the Australian beauty market and the availability of resources and support for new businesses. The report includes a business model canvas, illustrating the key components of the business strategy.

Running head: NEW AUSTRALIAN BUSINESS VENTURE
New Australian Business Venture
Name of the Student:
Name of the University:
Author Note:

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NEW AUSTRALIAN BUSINESS VENTURE
Executive Summary:
The paper aims to study a new business venture and plan in the Australian market. The new
business venture would be a soap-manufacturing firm called ‘Australian Organic Soaps Limited’
and it would offer premium quality organic soap for men and women. The men’s variant would
be called ‘Eastern Brown’ while the female version would be called ‘Snow Petrel’. The business
would target the middle and upper class customers who are rich enough to consume premium
skin care products. The business would establish its own supply and distribution chain. It would
have a cost revenue and cost structure which would allow it monitor costs and increase profits.
The growing demand for premium skin care products in among Australian would offer the
company opportunity to thrive and grow in the Australian. As far as areas are concerned the
company would launch the two soaps in the main cities of Australia and then make them
available in the rural areas as well. The paper covers several aspects of a new business like
market segment, cost structure and value proposition. A new business organisation in a
developed market like Australia has to face several challenges from the strong existing firms.
This makes them carry out a feasibility study, which analyses the feasibility on the grounds of
technology, financial aspects and human resource aspects. The paper contains a feasibility test
for Australian Soap Company.

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Table of Contents
Introduction:....................................................................................................................................3
Business Model Canvas:..................................................................................................................4
Customer segments:.........................................................................................................................5
Value Proposition:...........................................................................................................................5
Customer Relationship:...................................................................................................................5
Channels:.........................................................................................................................................6
The supply channels:...................................................................................................................6
The distribution channel:.............................................................................................................6
Key Activities:.................................................................................................................................7
Key Resources:................................................................................................................................7
Key partners:....................................................................................................................................7
Revenue structure:...........................................................................................................................8
Cost structure:..................................................................................................................................9
Minimum viable product of Soap Company:................................................................................10
Feasibility analysis:.......................................................................................................................10
Market feasibility:......................................................................................................................10
Technical feasibility:.................................................................................................................11
An analysis of the production process:..................................................................................12
Forms of business:.................................................................................................................12
Human feasibility:.....................................................................................................................13
Financial feasibility:..................................................................................................................13
Conclusion:................................................................................................................................14
References:....................................................................................................................................15

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NEW AUSTRALIAN BUSINESS VENTURE
Introduction:
The aim of the paper is to study a business plan and model of an Australian new business
venture. The new business venture would be a firm making an organic soap for men and women
and would be called ‘Australian Organic Soaps Limited’. The soap products would be available
in two variants. The men’s variant would be called ‘Eastern Brown’ while the variant for women
would be called ‘Snow Petrel’. The ‘Eastern Brown’ would be available in fragrances like musk,
woody and sandal. The package would have picture of an eastern brown snake which would
reflect that using the soap would make men confident and aggressive like the snake. The ‘Snow
Petrel’ would be meant for female customers and would be available in variants like rose and
milk. The package would have picture of a petrel flying over the ocean signifying ambition and
confidence in women. Both the variants would have organic ingredients like Australian
eucalyptus, aloevera and Indian sandal making them safe and beneficial for the skin.
 The first section of the paper deals with the customer segments of these two soaps by
Australian Organic Soaps Limited followed by value proposition of the two products.
 The third section deals with customer relationship of the company followed by channels
of business. This section has again been divided into two subdiviosns, the supplier chains
and the distribution chains.
 The next sections study key activities, key resources, key partners and revenue structure
of the new business.
 This is followed by cost structure, minimum viable product and feasibility analysis for
the new business venture.

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Business Model Canvas:
Key partners
Financial
institutions
Microcredit
institutions,
retailers,
marketing
agencies and
suppliers
Key Activities
Acquisition of raw
materials like
aloevera, organic
oils, cocoa butter
and sandalwood
oil.
Value proposition
Creamy lather,
moisture and
freshness
Soap
Quality
Customer
relationship
Assistance to
customers with
regards to product
features, quality
and points of sale.
Communication
through social
networking sites
Customer
segments
Urban high income
and stylish Men
and women
Key resources
Material resources
Plant and
machinery
Human resources,
Packing materials.
Channels
Suppliers
Distributors
Local farmers
Wholesalers
Revenue streams
Sale of soaps less
the costs
Cost structure
Raw materials
Fixed costs
Initial capital investment in fixed assets
Variable costs like employee salary
Licensing costs.
Distribution costs
Marketing and advertisement costs
Figure 1. Figure showing business model canvas
(Source: Author)

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NEW AUSTRALIAN BUSINESS VENTURE
Customer segments:
The ‘Eastern Brown’ and ‘Snow Petrel’ would target the middle and upper class
customer segments. The target customer segments would consist of modern and contemporary
men and women of Australia who like to take care of their skin with organic soap. The soaps
would segment the customer bases geographically, financially, psychographically and
behaviourally(Hamka et al. 2014).
The two soaps would segment the market geographically. The company would make the
first soaps available in the cities and then make them available in the rural areas. Australian
Organic Soaps Limited would target the customer segments who lead lifestyle, which allows use
of premium skincare products (Dzobo et al. 2014).
Value Proposition:
The value proposition of Australian Organic Soap Limited would be offering premium
quality soap to the contemporary men and women of Australia. The company would aim at
offering high quality soaps at premium prices. This high price would guarantee high quality to
the customers who are ready to spend a lot of money to get high quality skin care products. The
rich lather and superior quality ingredients would leave the skin of the users nourished and soft.
The fragrances would elevate the level of confidence of the users, which would boost their
confidence level (Covin et al. 2015). These benefits to the skin and increase in the level of
confidence would add value to the purchase the consumers. The value proposition for the
customers of the two soaps would be luxurious bathing experiences, which would make them
feel energised.
Customer Relationship:
Australian Organic Soap Limited would maintain healthy and long lasting relationship
with its customers by offering high quality premium organic soaps to them. The company would
make the products available to the customers at the grocery shops and retail chains in the main
cities of Australia and then gradually make them available in the rural stores. The customers
would be able to give their feedback about the products on the customer care number. The

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company would also maintain a continuous flow of communication with the customers using its
official website and social networking media like Facebook(Hollensen 2015).
Channels:
Australian Organic Soap Limited would have two channels supporting its operations, the
supply channels and the distribution network or channel. The supply chain would supply the
company with raw materials and the distribution channels would ensure availability of the soap
products in the market(Christopher 2016).
The supply channels:
The supply chains would consist of suppliers who provide Australian Organic Soap
Limited with raw materials for the soaps. The main raw materials of the soaps would be natural
ingredients like eucalyptus oil, Indian sandal wood oil and milk. The company would emphasis
on acquiring these raw materials from sustainable sources like local farmers. This way it would
be successful in contributing to economic development of the local farmers by buying raw
materials from them. It would also have the soap packages made from recycled paper in local
paper mills. This way the company would be able to encourage sustainable making of packaging
among the other Australian soap companies (Monczka et al. 2015).
The distribution channel:
Australian Organic Soap Limited will use an extensive network distribution network to
distribute its products in the market. The company would make use of wholesalers and retailers
who would make the soaps available in the market to the middle and upper class customers. The
company would hire logistics services to transport the products to the retailers and the
wholesalers. As a result, the wholesalers and retailers would be able to stock and sell ‘The
Eastern Brown’ and ‘Snow Petrel’ to the customers. This large-scale availability would help
these two products gain competitive advantage in the market. Moreover, the two soaps would be
available in the high-end skin care outlets in the cities to attract the attention of the rich
shoppers(Cui and Mallucci 2016).

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NEW AUSTRALIAN BUSINESS VENTURE
Key Activities:
The key activities of Australian Organic Soap Limited would consist of a wide range of
activities ranging from acquisition of raw materials to the sale of products to the final customers.
The first activity of the Australian Organic Soap Limited starts with the marketing receiving
orders from the market. The production department makes a budget of the raw materials to be
acquired with approval from the accounts department. The production department then acquires
the raw materials from the producers like suppliers of eucalyptus oil and sandal wood oil. The
production department than produces the soaps and forwards them to the quality department for
quality testing. The soaps which qualify the quality testing of the quality department are
packaged by the packaging department. These packaged bars of soap are priced and shipped to
the retailers and wholesalers. The accounts department records revenue generated from selling of
soaps. The waste products generated by the production of the soaps are then recycled to form
manure and other materials(Jeston and Nelis 2014).
Key Resources:
The key resources used to make ‘The Eastern Brown’ and ‘Snow Petrel’ are organic raw
materials like eucalyptus oil, Indian sandal wood oil, rose oil and extracts flowers like rose. The
other key resources use in manufacture of soap consists of fragrances and preservatives used to
maintain the quality of the soap products while they are on transit. The ancillary resources
consist of packages, which are used packaging the soaps. The human resources and the
machinery also form part of the key resources in manufacturing the soap products(Goetsch and
Davis 2014).
Key partners:
The key partners of Australian Organic Soap Limited would be the stakeholders, which
play significant role in manufacturing of its soap products. The company would consider the
management body and employees as key business partners. The management would form
business strategies and policies on which the company would function. The middle level
directors would communicate these strategies to their subordinates who actually execute the
plans. This makes the employees and the management key partners who adopt and execute

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business strategies, which leads to smooth operations of the company(Wheelen and Hunger
2017).
Australian Organic Soap Limited would consider the customers key partners because
they are the ones who create demands for the products. The customers consume the products and
generate revenue for the company. This important role of revenue generation played by the
consumers make them significant business partners(Macdonald, Kleinaltenkamp and Wilson
2016).
The next line of business partners consist of suppliers and distributors. the suppliers
supply the company with organic raw materials at economic rates which help the company to
maintain a low cost of production. This also allows it to produce more product units and earn
higher margin of profits by selling. This discussion shows that suppliers play a very significant
role in making materials available to Australian Organic Soap at economic prices so that the
company can gain leadership in the market(Popa, Soto-Acosta and Loukis 2016). The
distributors ensure that the finished products of Australian Organic Soap reach the final
consumers. The distributors would help the soap making company offer its products to the
middle and upper class customers readily and give the company competitive advantage in the
market. Thus, suppliers and distributors are key business partners because they help the company
to make products available to the final consumers(Karray 2013).
Revenue structure:
The revenue structure of Australian Organic Soap consists of revenue collected from
repeat business from the outlets where the soap products are sold. The main expenditures would
include the material cost, production cost, administrative cost and the marketing cost. These
expenditures would be deducted from the sales to calculate the profit amount. The taxes are
deducted from the net profit to calculate profit after taxes. The company revenue structure would
be weak and consist of several expenditures in the initial phase and less number of outlets. The
revenue earned from selling the soap is expected to rise as the soaps gain bigger consumer base
in the market owing to continuous marketing efforts by the marketing department. As the
company succeeds in establishing more economical supply and distribution network, it would
able increase its production and earn higher profits by selling the two soaps(DaSilva and Trkman
2014).

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Cost structure:
The cost structure of the Australian Organic Soap Limited would consist of two types of
cost, fixed cost and the variable costs. The fixed cost would include taxes, factory rent and
tariffs. The business would also require capital investments in acquisition of land and building,
vehicles, plant and machinery and office buildings to start the initial production. The variable
costs include salary of employees, maintenance cost of machinery and stationary expenses. The
semivariable costs include telephone expenses and electricity expenses(Fageda, Suau-Sanchez
and Mason 2015).

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Cost categories Examples
Fixed costs Taxes, Rents
Variable costs Amount spend to acquire materials, salary of employees, stationary, marketing
expenses, lighting costs
Semi variable
costs
Telephone expenses, electricity expenses
Figure 2. Figure showing types of costs
(Source: Author)
Minimum viable product of Soap Company:
The minimum viable product of Australian Organic Soap Limited would be organic soaps
capable of offering clean and fresh feel to their users. The soaps would be made from organic
materials like eucalyptus and aloe vera and be available in two initial variants. One variant called
‘Eastern Brown’ would target the male customers and be available in musky fragrance. The
second variant would target the female customer under the name ‘Snow Petrel’ and would be
available in rose fragrances. The company would introduce the soap products in these two
variants as the minimum viable product on entering the Australian market. It would then expand
its product line into other beauty products as it strengthens its market position(Schroder 2015).
Feasibility analysis:
Market feasibility:
The market feasibility of the two soaps by Australian Organic Soap is positive. The
beauty industry in Australia has experienced tremendous growth in the last thirty years and the
demand for beauty products are rising. Both men and women of Australia are showing increase
in interest in beauty products. The bloggers keep the consumers informed about the latest trends
in the fashion market. Australian beauty market has presence of multinational brands from all
over the world. This analysis shows that it is market feasibility of the two soaps by Australian
Organic Soap is positive and the company can go ahead with the manufacturing and marketing

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of the soaps(Huffington Post Australia. 2017). The soap industry is experiencing steady growth
with presence of big brands like Dove, Palmolive and Imperial Lather. This presence of big
brands owned by Unilever, Colgate and Palmolive and Cussons respectively. This presence of
multinational brands acts as barrier to entry of new companies like Australian Organic Soap
Limited from entering the market. The government regulations like, sustainability requires the
companies invest huge amount of funds towards acquisition of sustainable technology, which is
very expensive. The multinational companies like Unilever and PZ Cussons are financially
strong and invest in acquiring of sustainable technology. However, new ventures like Australian
Organic Soap Limited cannot invest huge amount of money towards achievement of
sustainability. Thus, the government laws like, mandatory achievement of sustainability proves
to be barrier to entry of new companies in the beauty market of Australia (Schroder 2015).
The rise of per capita income in Australia has resulted in more disposable income in the
hands of the Australians. This would allow them to spend more money towards buying of
luxurious goods like premium soaps. This would allow Australia Organic Soap Company to
serve more customers and earn higher revenue. The soap products should add value to the
customers’ expenditure through their superior quality, rich creamy lather and fragrances. They
should make the users feel refreshed and confident (Hollensen 2015). These attributes would
allow the soap company to create higher value to the customers and earn higher revenue. This
proves that the market feasibility of the soap business venture is positive.
Technical feasibility:
The new business of making soap by Australian Organic Soap Limited is positive. The
country is advanced in technology and has suppliers of machinery to make soap. The suppliers in
the country provide organic raw materials like vegetable oil and fragrances like rose. The market
of the company has logistics companies who make the finished products(soap here) available to
the consumers. Moreover, there are companies in the market which make recycling machinery.
This shows that the soap manufacturer can attain sustainability by acquiring raw materials from
the sustainable suppliers and use the services of the recycling companies. This analysis shows
that the soap manufacturing business in Australia is technically feasible (Andersen et al. 2015).
The figure below shows the process of soap manufacturing and distribution operations, which
Australian Organic Soap Company can follow to manufacture its soap products.