ENT20: Business Plan for Australian Luggage with Fingerprint Lock

This business plan focuses on launching luggage with fingerprint lock technology within the Australian Luggage Company. It begins with an executive summary and table of contents, followed by a detailed business model canvas outlining key partners, activities, value propositions, customer relationships, and financial structures. The plan then analyzes the Australian luggage market, including its size, growth, competitiveness, and trends, along with market segmentation and target customers. The operations and technology section covers development, production, sales, and required resources. Human resources, including ownership structure and manpower requirements, are also discussed. Finally, the plan presents financial projections, including startup costs and profit and loss statements for the next three years, concluding with a discussion of financing options and overall conclusions. The plan highlights the innovative nature of the product and its potential for success in the market.

Running head: ENTREPRENEURSHIP
Business plan on 'Luggage with fingerprint lock'
Name of the Student:
Name of the University:
Author note:

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Executive summary
The luggage industry of Australia is quite large. A new business idea of luggage with fingerprint
lock will be launched by the Australian Luggage Company as an innovative product in the
market. This report highlights the features of the market, industry size, operations and
technology, human resource and finances of the company for the new business ideas. The startup
cost, and profit and loss statement for the next three years is also estimated in this report. It is
seen that in the Australian luggage market the new business idea will be beneficial for the
company in the long run.

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Table of Contents
1. Introduction..................................................................................................................................3
2. Business model canvas................................................................................................................4
3. Market..........................................................................................................................................5
3.1 Market size and capacity.......................................................................................................6
3.2 Industry growth, competitiveness and barriers to entry.........................................................6
3.3 Industry trend.........................................................................................................................7
3.4 Market segmentation.............................................................................................................7
3.5 Target customers....................................................................................................................7
3.6 Place of distribution...............................................................................................................8
3.7 Business location and potential customers............................................................................8
4. Operations and technology..........................................................................................................8
4.1 Development of technology...................................................................................................8
4.2 Changes in technology affecting the market.........................................................................8
4.3 Option for producing the product..........................................................................................9
4.4 Sales and distribution.............................................................................................................9
4.5 Required resources.................................................................................................................9
4.6 Laws and regulation...............................................................................................................9
4.7 Moral/ethical issues.............................................................................................................10
5. Human resources.......................................................................................................................10

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5.1 Technical and management experience required.................................................................10
5.2 Owners and their roles.........................................................................................................11
5.3 Ownership structure.............................................................................................................11
5.4 Manpower requirements......................................................................................................11
5.5 Growth strategy...................................................................................................................12
6. Finance.......................................................................................................................................13
6.1 Projected revenues...............................................................................................................13
6.2 Start up cost for the new product diversification department..............................................14
6.3 Profit and loss statements for the next 3 years....................................................................16
6.4 Possible source of financing................................................................................................17
7. Conclusion.................................................................................................................................18
References......................................................................................................................................19

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1. Introduction
Innovative business model refers to the type of innovative product or service that not only
would benefit the customers and but also the companies through market popularity and profits.
Innovative business ideas are launched in the market to attract a new target market and give them
more value than the existing products (Saebi and Foss 2015). Luggage with fingerprint lock is a
new business idea that will be discussed in this report. As the technology is getting advanced,
and biometric technology is being extensively used in many of the products and services, hence,
luggage bags or trolleys have installed security system through locks and number locks, the
installation of fingerprint technology would be a new idea, which would make the luggage bags
more secure. Fingerprint technology is a new safety and security measures, which is being used
widely in products, such as, smartphones, which has increased the security of the phone and the
information stored in it as fingerprint is unique and hence, it reduces the risk of data hacking.
Similarly, the luggage bags or trolley are mostly made secured through lock and key on the
zipper or through number locks. There are some disadvantages of these measures, such as, the
key can be lost and the owner can be stuck with the lock, and for number locks, if the owner
forgets the number combination, the luggage cannot be opened unless the lock is broken. Hence,
fingerprint lock is not only easier and convenient, but also more secure. Hence, it is forecasted
that the new business idea can capture a large market share, especially the travelers with its
innovative technology and feature.
2. Business model canvas
Key Partners Key Activities Value
Propositions
Customer Customer
Segments

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One of the luggage
manufacturing
companies, The
Australian Luggage
Company
(ausluggage.com.au
2019).
The suppliers of
raw materials and
fingerprint
technology
Making luggage
with fingerprint
locking
technology and
keeping the
design
attractive
Increase in the
convenience of
security of the
luggage and
trolley bags by
implementing a
new-age
locking
technology, that
is, fingerprint
locking, which
will make the
products more
secure and also
increases value
by reducing the
risk of losing
keys or
forgetting the
number lock
password for
the bags.
Relationships
The Australian
luggage
industry is an
AUD 320
million
industry
(Ibisworld.com
.au, 2019) and
hence, the
Australian
Luggage
Company has
an established
market for its
high quality
product. Thus,
it is easier to
reach out to the
existing
customers of
the company
and the
potential
customers
through
promotional
techniques
(Baker 2016).
 Urban and
semi-
urban
population
 Travelers
 Back-
packers
 Office
goers
 Fashion
bags users
Key Resources
Fingerprint
technology,
luggage manu-
facturing
materials,
human
resources,
Channels
 Retail
outlets of
the
Australian
Luggage
Company
 Franchise

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especially the
product
designing and
marketing
teams
stores
 Factory
outlets
 Online e-
commerce
sites
Cost Structure
 Fixed costs
 Variable costs of manufacturing
 Cost of technology
 Cost of marketing
Revenue Streams
 Direct sales through outlets
 Sales through e-commerce
Table 1: Business model canvas
(Created by author)
3. Market
Market for any product, service or business refers to the total volume of the customers
and potential customers, that is, industry size and growth rate (Baker 2016). Hence, Market
represents the section of the particular customers who would avail the product or service. In case
of the new innovative idea, if the product or service is launched independently, then it has to
capture the market from scratch. Hence, if the idea is incorporated as a product or service
diversification of an existing company, it is easier to capture and address the existing and target
market. Thus, the Australian Luggage Company is launching the new innovative product, that is,
luggage with fingerprint lock, which will be targeted to the existing as well as potential
customers who prefer to use devices with smart technologies.

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3.1 Market size and capacity
The luggage industry of Australia is worth of AUD 320 million as on 2018
(Ibisworld.com.au 2019). Numerous local and international companies operate in this industry,
through manufacturing and imports. However, the industry is growing due to increase in the
number of domestic and international travelers, including backpackers and fashion accessories
users, as well as users who prefer smart technology in their regular life.
3.2 Industry growth, competitiveness and barriers to entry
According to IBIS World (2019), from 2014-2019, the industry experienced an annual
growth rate of 3.8% and there are around 161 businesses operating currently with a workforce of
around 1621. While the revenue from online sales is around AUD $97 million, with an annual
growth rate of 9.4% from 2014-2019. Around 181 businesses operate in the online sales platform
(Ibisworld.com.au 2019). Thus, competition in the luggage manufacturing industry across the
country is intense. However, the barriers to entry for a new product is low as it is an innovative
idea, to be launched under an established luggage and bag manufacturing company, hence, there
will be no initial barriers to entry.
3.3 Industry trend
Intense competition from numerous luggage companies has been pushing the price of the
products downwards, especially the spread of online sales has been pushing the price further
down, implying the popularity of convenience and smart technology.
3.4 Market segmentation
Segmentation criteria Segmentation category
Demographic  Age: 20 and above

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 Income: monthly income with 15000 AUD and above
 Urban and semi-urban population
Behavioral  Brand loyal
 Prefers durable luggage products
 Look for value for money
Geographic  People all across the country
Psychographic  Luxury and backpacker travelers
 Business travelers
 Fashion accessories users
 People who prefer devices and products with smart technology
Table 2: Market segmentation
3.5 Target customers
The travelers, including, leisure and business, fashion bags users, people who prefers
convenience through smart technologies, especially people belonging to the age group of 20 to
35 who are more accustomed with smart devices are the target customers.
3.6 Place of distribution
Various retail outlets of the Australian Luggage Company, franchise stores, departmental
stores and online e-commerce sites will be used to supply the product to the customers.
International brands, such as, Samsonite, American Tourister etc. and various local
luggage manufacturers are the major competitors. However, none of these companies have

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launched any unique product yet, hence, the competition for the luggage with fingerprint lock is
much lower as there is no similar product in the market.
3.7 Business location and potential customers
The store locations and headquarter for the Australian Luggage Companies will be used
for business for the new product and it is expected that among the existing customers of the
brand, the young generation will be the first to buy the products.
4. Operations and technology
4.1 Development of technology
The fingerprint technology will be developed and implemented in the new models of
various types of luggage through contract to the designers and technology developer.
4.2 Changes in technology affecting the market
The changes in the security features for all types of products are a driving factor for
implementing the new lock technology in the luggage. The growing preference for smart
technology in all types of products, such as, smart devices has been a pushing force for
developing the innovative fingerprint locking technology for luggage.
4.3 Option for producing the product
The in-house manufacturing department of the Australian Luggage Company will make
the luggage and the fingerprint sensor will be collected through contracting and that will be
incorporated into the products through technical collaboration with the contractor.

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4.4 Sales and distribution
For sales and distribution, the existing in-house channels will be used as it is a new
product lunched by the Australian Luggage Company and hence, using the existing channels
would reduce the supply and distribution network costs for the company. Moreover, the
customers will also be able connect easily with the brand name if the direct retail outlets,
franchise stores, factory outlets and departmental stores are used for sales along with online
purchase options as increases visibility of the products (De Mooij 2018).
4.5 Required resources
Luggage manufacturing skills and raw materials are available to the company along with
suppliers, facilities and equipment. However, the skill for developing the smart fingerprint sensor
technology is not available and hence, the manufacturing of the technology will be contracted to
a technology developing firm.
4.6 Laws and regulation
As stated by Picciotto (2017), any business must be aligned with the local and state
business regulations to ensure a lawful, ethical and transparent business which will benefit the
economy through profits, employment and customer service. Similarly, even for a new product
launch, the Australian Luggage Company must abide by the local and central laws and
regulations designed for the industry. The products must provide value for money, the price
should be competitive even it is meant for profit making business, the new technology should not
be harmful for the environment, that is, it should be sustainable. Furthermore, as fingerprint lock
is a new technology in the luggage manufacturing industry, its copyright must be established and
the intellectual property should be protected. Hence, patent should be designed to protect the

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intellectual property of designing new luggage with fingerprint sensor technology. This will help
the company to have a competitive advantage in the market by protecting the new design.
4.7 Moral/ethical issues
The business idea is an innovative one and there is no perfect substitute in the market. It
is a part of product diversification strategy of the Australian Luggage Company to capture a
larger share in the market and hence, there is no complicated moral or ethical issue for the
innovative product development and launch. However, the product should be sustainable and
must have less impact on the environment, which is addressed by the development and
implementation of the smart technology, that is, fingerprint sensor, that increases value for
customers without increasing carbon footprint.
5. Human resources
5.1 Technical and management experience required
The Australian Luggage Company has been operating as one of the leading luggage and
bag manufacturers since 1996. All of its departments have the technical and managerial
experience to manufacture the products and distribute those efficiently to reach out to the target
customers. However, the company does not have the expertise to develop the smart technology,
that is, fingerprint sensor as a lock for various types of bags. Hence, the development of the
technology will be outsourced and until the in-house department is established and skilled
developers are hired, the manufacturing of this technology will be given to a technology
developing firm. Thus, the company needs to develop a separate in-house department and hire
and train technology developers for developing and implementing the technology in its new
luggage.