MBAF503 Business Plan: Comprehensive Analysis of SNS Cosmetics

This business plan comprehensively analyzes SNS Cosmetics, outlining its business model, market research, competitive advantages, and SWOT analysis. It delves into the marketing plan, including market segmentation, customer profiles, and the marketing mix (price, product, place, and promotion). The plan also details the company structure, human resource plan, operational and technology plans, and an action plan with a timeline. Financial projections, including start-up costs, sales, and income projections, are provided to assess the company's potential. The plan considers market segmentation based on cosmetics category, sales structure, gender, and geographical distribution. The plan provides an overview of the cosmetics industry, highlighting the importance of innovation and technology to remain competitive. It explores the strengths and weaknesses of SNS, as well as the opportunities and threats it faces in the market. The marketing plan covers market segmentation, customer profiles, and the marketing mix. The financial plan includes start-up costs, sales projections, and income projections. The document also includes references to support the analysis. The assignment fulfills the requirements of an MBAF503 business plan project.

Running Head: MBAF503 BUSINESS FUNDAMENTAL
MBAF503 Business Fundamental
Name of the student:
Name of the University:
Author Note:

1MBAF503 BUSINESS FUNDAMENTAL
Abstract:
The business plan of SNS is to conduct business on standard and licensed cosmetics to
become the number one choice among the residents and the modern communities. There is a
wide range of hair care and other allied products, cosmetics, skin care products, fragrances,
nail care products, deodorant and shaving lotions, sun care, baby care and other related
product set from different manufacturers from Dong Guan in China. There have been several
permits that have been secured for it sale purpose.

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Table of Contents
Introduction................................................................................................................................4
Company Overview...............................................................................................................4
Business Model......................................................................................................................4
Market Research.........................................................................................................................5
Competitor overview..............................................................................................................5
Competitive Advantage..........................................................................................................6
SWOT Analysis.....................................................................................................................7
Strengths:............................................................................................................................7
Weaknesses:.......................................................................................................................7
Opportunities......................................................................................................................8
Threats:...............................................................................................................................8
Marketing Plan...........................................................................................................................9
Market Segmentation:............................................................................................................9
Customer Profile....................................................................................................................9
Marketing Mix.....................................................................................................................10
Price:................................................................................................................................10
Product.............................................................................................................................10
Place:................................................................................................................................10
Promotion:........................................................................................................................10

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Company Structure and Human Resource Plan.......................................................................10
Employees structure.............................................................................................................10
Policies and regulations........................................................................................................11
Operation Plan and Technology plan.......................................................................................12
Action Plan and Timeline.........................................................................................................12
Financial Projections................................................................................................................13
References................................................................................................................................22

4MBAF503 BUSINESS FUNDAMENTAL
Introduction
Company Overview
S.N.S. as a company provides an innovative, reliable and renders high quality
services. The company delivers high quality skin care and cosmetics product. The company
believes in the clients as its first priority. The company believes in establishing a
collaborative relationship between the employees and its customers to strengthen its market
base. The company was established in 1982 in the Dong Guan region of China. The company
had a very modest starting and the area of specialization during its time of inception was
healthcare products. Since its inception in 1982, the journey of this company has experienced
a rapid growth, huge geographical expansion and diversification in general. In present time,
the company has expanded its worker ratio to more than 16 direct employees. Today, SNS is
formulating a business strategy to conduct sales worldwide. The swift growth of this
company has been a testimony for its forward-looking approach (Ikenami & Garnica,2016).
Business Model
There are several things that a company should consider before starting its business as
a Cosmetics company including an outline of the methodologies in which the products will be
manufactured, the manner and scale in which they will be produced, and the procurement
method adopted by the company. The company mainly focuses on the manufacturing and the
distribution framework of this cosmetics company. To create a powerful cosmetics brand can
be of an exceptional challenge brand is an exceptional challenge, which can be achieved by
acquiring the product at a competitive price or by the market identification of the untapped
niche or a set of several other, such factors like the market positioning for a cosmetics
company can vary to a large extent

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The market positioning for a cosmetics company can vary largely, but it is one of the primary
concern in the highly competitive market structure. Many cosmetics company are in acute
competition for similar market share in the mainstream market and the most successful
business models that have entered into a market niche that can be capitalized by them. The
market positioning strategy is critical in the context of determination of the strategy of the
company and is the most important element of this business model. The supply chain of any
company is another key market force in the business model for a cosmetics company, which
can range wildly in the context of the structure of the company. The supply chain in case of
the cosmetics industry is considered in the downstream perspective as some choose to work
through the chain of distributors whereas the other companies sell directly to their customers
or through the tradeshows and the wholesale perspective.
Market Research
Competitor overview
The SNS cosmetic industry has always recorded a significant and a strong growth rate
over the years and thereby it has emerged as one of the key industries that holds the highest
potential for further growth and development purpose. The market research of this cosmetics
industry reflects a projected growth for both male and female consumers worldwide. The
increase in awareness for the quality beauty products, the offered treatments, and its
glooming has rapidly boost up the cosmetics industries worldwide. Due to the increase in the
demand of the cosmetics products, it has resulted to a high degree of global competition. The
cosmetic industries are slowly becoming more innovative and creative in the process of
providing the unique high quality products in the market to earn the advantage from its
competitors. For the SNS cosmetic industry to survive in the stiff competition, it needs to
upgrade their products and update its integrated technology to remain highly productive in

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the business throughout. The cosmetic industries in order to survive in market needs, it needs
to embrace a proper SWOT analysis and it should provide high quality product at affordable
prices. They also need to purchase the quality labeling machines to help them in the
production of quality products and deliver the same to their consumers.
Competitive Advantage
The new startups, which are likely to enter the cosmetics industry seems to get lesser
advantage than the already established companies in the market are. The absorption of the
comparative advantages requires a detailed consideration of how to establish the brand
structure or to influence the buyers to purchase products from that company. However,
owning a small firm enables the company to target its specific niches as compared to the
other larger companies resulting in low profit margins at times of selling certain specific
products. The company can also consider creating a set of makeup products or skincare
products for people affected with allergies to ingredients, which are commonly used, by most
of the cosmetics industry. This helps the company to build a brand which people will prefer
than the other products and will refer the same the same to friends and the other known
people who are suffering from the same problem. One of the key advantages of owning a
small cosmetics company is the provision of a personalized customer care service. For
instance, the company offers instruction on the manner of the use of the cosmetics and to help
the customers to choose the best products to match with their skin type or the skin tone to
build the sense of loyalty among its customers. With the onset of a positive relationship with
the customers, there are scope of referrals, which will make the revenue earning process of
the company easier
The new startup in order to create their own product line should take the help of the cosmic
labs such as in using the different organic products or products, which are designed by the

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celebrities, they tend to get the free in the context of the latest publications in the cosmic
world.
Unlike the other businesses, the cosmetic industry is all about the physical appearance of the
product and whether it works on someone’s skin. The advantage of this concept is that it
becomes easy to display this product in different ways, such as the technique of product
packaging as well as the before and after photos to influence the customers to use this
product.
SWOT Analysis
Strengths:
While the other products have a certain product line that concentrates on the cosmetics and
the other personal care products, the SNS as a company is focused on the beauty products,
which results in the phenomenal success of the company specifically in this sector. The
detailed research and development strategy of the company is concerned about the beauty and
the cosmetics product and not only on the pure manufacturing mechanism in general. The
SNS Company also conducts research on the suitability of its products according to the
different warm and cold seasons. The company has a high brand portfolio and a fantastic
product outline and is also known for its high quality of products – a company can only
establish a good brand image only if the products of that company can ensure maximum
satisfaction from the consumers. Another strength of the company lies in its integrated
marketing communication network. The company has also a widespread distribution strategy
at present in all over 130 countries, which has led to wider economies of scale. The products
of SNS are natural and purely organic in nature.

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Weaknesses:
The major weakness of this company is the presence of various subdivisions, which results in
the difficult operation of the company and delay in solving the issues and the problem. The
company also becomes relatively slow and bulky because of the prevalence of the high
subdivisions present in the company. The sector of hair care is facing the biggest decline due
to the stiff brunt in its competition. The company in the recent times has recorded lower
profit margins because of higher investments in the field of research and development.
Opportunities
The first opportunity that lies ahead of the SNS Company is its huge market potential. The
market potential for the range of personal care and beauty products going to increase with the
coming years. The second opportunity will be the product mix expansion, which faces
expansion of all the product lines for introducing the new products in the market. There is a
growing demand of organic beauty products in the age of awareness, so this rising demand
for the organic products can provide a huge opportunity to the SNS Company. Finally, the
revival of the body shop will provide a huge opportunity to the company; however, the
potential is yet to be explored.
Threats:
The system of constant updating its latest products can be a probable threat in terms of the
time management process, this dynamic nature of the cosmetics industry can prove to be a
possible threat in the cosmetics industry. The second threat is the cash crunch that is faced by
the company and the presence of various sub brands result sin difficulty in the division of
cash. Finally, the presence of several economic problems in the home country as well as the
other country causes a big threat as it restricts the overall cash flows and the functioning of

9MBAF503 BUSINESS FUNDAMENTAL
the capital management very difficult. This at times also results in crash crunch of the
company(Hackbarth & Gamble,2016).
Marketing Plan
Market Segmentation:
The market segmentation of SNS Company for cosmetics is segmented based on the category
of cosmetics, its sale structure, gender and the area of the geographical distribution. The
category segment also includes the sun care and the skin products, different hair products,
deodorant sand fragrances. Among the various range of products, the hair products and the
skincare products are the products facing the maximum demand in the market. The mode of
sale comprises of the retail and the online sale type. Customers for buying the products
mainly prefers the retail mode of sale in case of the cosmetics industry. In the context of the
technological advancements, the skincare sector is at the highest place. There is also a rising
demand for the several herbal cosmetic like the REN skincare. The SNS company has also
initiated the segmentation by focusing its product diversity according to the gender types on
the individual preferences of the men and women in general in the society. The geographical
segmentation of this company depends on the region of North America , European and other
such similar preferences.
Customer Profile
The customers can be grouped into marketing and advertisement groups. Companies and
marketers can find more access in selling a particular product by targeting a specific market
segment. Before starting to market a particular product to the potential customers, it is
important to take some time before it carves out the ideal consumer profile for the products.
An ideal customer can be defined by the following parameters of its identification like the
customers preference, their lifestyle , the different stages in life and the various The process

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of assigning the categorical tiers to the consumers can be useful. The first tier highlights the
most common categories for describing the consumers, which can be the demographic status
and the socio economic data. The second tier works on the concepts of the first tier and
includes psychographics, generation, geography, geodemographics, and benefits sought.
Marketing Mix
In the context of the cosmetics industry, there are 4 dominant marketing mix tools:
Price:It will depend on the costs of production, the targeted segemenst, the ability of the
market to pay, the supply - demand chain and a host of other direct and indirect factors. There
can be other several types of pricing strategies, each related to an overall business plan.
Pricing can also be used a demarcation tool, to differentiate from the other products and
enhances the product image in the market.
Product: refers: It refers to the actual product sold and in terms of the other marketing mix
its influence on the marketing is very less.
Place: It refers to the exact place of sale of a product and the determination of that
geographical location where it will provide the maximum profit to the company.
Promotion: This refers to the promotional activities that a company adopts to enhance it
marketing. The promotional tools include the television advertisements and through the
different ad journals. All the elements present in a marketing mix influence each other. They
will formulate the business plan for a company if it is handled in the right direction can be of
immense success (Hackbarth & Gamble,2016).

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Company Structure and Human Resource Plan
Employees structure
The employee structure of any organization is the determining factor for any enterprise,
whether it is a nongovernmental organization or a family business or can be a multinational
corporation. It determines the working relationship that exists between the managers and
subordinates as well as among the different subordinates themselves. Business owners have a
wide array of employee structures to choose a startup business. The structure chosen will
have a huge effect on the potential growth of the company, on the morale of the individual
workers, and the overall business' profitability. The best employee structure of any
organization also depends on the type of enterprise and the products brought under sale by
them (Pimenetel,2016).
Policies and regulations
The Company policies and procedures establishes the rules of business conduct within a
single organization, by outlining the responsibilities of both the employees and the
employers. Company policies and procedures are necessary to protect the rights of the
workers as well as of the business interests of employers. Depending on the needs of the
organization, there are various policies and procedures that establishes the rules regarding the
employee conduct, attendance, their dress code, privacy and other such areas related to the
terms and conditions of employment (Pimenetel,2016).
An employee conduct policy also establishes the duties and responsibilities each employee
that must be adhered to as a condition of employment. The conducting of various policies are
in place as a guideline for the appropriate employee behavior, and they outline things such as
proper dress code, proper workplace safety procedures, harassment policies and policies
regarding computer and Internet usage. Such policies also outline the procedures employers

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may utilize to discipline inappropriate behavior, including warnings or employee termination.
The rules and regulations should ensure equality in the service and pay conditions of the
employees (Pimenetel,2016).
Operation Plan and Technology plan
For an acquisition program in an organization the technical direction may be defined by
generating a program-level technological strategy that is documented in a technology plan or
a given roadmap. In the context of the current state and constant change of technology,
without a common guidance, individual organizations may still use their own methods and
technologies in ways that can actually hinder their adaptation. A technology plan provides the
guidance to for the relevant technologies to address the future mission needs, and to
communicate the vital information to stakeholders, provide the technical portion of the
overall program plan ,and gain certain strong executive support. It provide a basis for an
ongoing technology that provides a dialogue between the sponsor and systems developers
(Athanasakou & Olsson, 2016).
Action Plan and Timeline
0-2 3-6 7-8 9-10 14th
Research
Activities
Weeks Weeks Weeks Weeks Week
selection
of
Research
topic
Literature
Review
Data
collection
Data
analysis

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Final
business
Research
thesis
Financial Projections
Startup Expenses
Startup Expenses
Buildings / Real Estate
Purchase
$
20,000
Construction
15,
000
Remodeling
2,
000
Other
1,
000
Total Buildings and R / E
$
38,000
Leasehold Improvements
Item 1
$
12,000
Item 2
2,
000
Item 3
3,
000
Item 4 -
Total L / H Improvements
$
17,000
Capital Equipment List
Furniture
$
40,000

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Equipment 400
Fixtures
2,
000
Machinery
1,
200
Other -
Total Capital Equipment
$
43,600
Location and Admin Expenses
Rental
$
12,000
Utility Deposits 300
Legal and Accounting Fees
4,
000
Prepaid Insurance
2,
000
Pre-opening Salaries
10,
000
Other -
Total Location and Admin Expenses
$
28,300
Opening Inventory
Category 1
$
1,200
Category 2
3,
000
Category 3
12,
000
Category 4
30,
000
Category 5
12,
000
Total Inventory
$
58,200

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Advertising and Promotional
Expenses
Advertising
$
5,000
Signage
2,
200
Printing
3,
000
Travel & Entertainment
4,
000
Other / Additional categories
2,
000
Total Adv and Promo expenses
$
16,200
Payroll and payroll taxes
Expense 1
$
12,000
Expense 2
3,
000
Total Payroll and payroll taxes
$
15,000
Sales Projection
1. Year-one revenue expectancy
Organic Health Beauty Beauty
Number of units sold annually 10,000 7,000 8,000 9,000
Average sales price per unit $20.00 $25.00 $30.00 $35.00
Annual revenue per product $200,000 $175,000 $240,000 $315,000
Total year 1 revenue $930,000
2. Year 1 cost of goods sold
Organic Health Beauty Beauty

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Expected gross margin per product 20.00% 25.00% 30.00% 35.00%
Annual cost of goods sold per
product $40,000 $43,750 $72,000 $110,250
Total year 1 cost of goods sold $266,000
3. Annual maintenance, repair, and
overhaul
Factor (%) on
capital equipment 20%
4. Number of years for straight-line
depreciation 5
5. Annual tax rate 30%
6. If long-term debt is being used to
finance
operations, enter the total loan
value.
-
7. Account receivable and payable % 20%
Income Statement
Year-by-year profit and loss assumptions
Year 1 Year 2 Year 3 Year 4 Year 5
Annual cumulative price (revenue)
increase - 2.00% 4.00% 6.00% 8.00%
Annual cumulative inflation
(expense) increase - 2.00% 4.00% 6.00% 8.00%
Interest rate on ending cash 0.50% 0.50% 0.50% 0.50% 0.50%

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balance
Year 1 Year 2 Year 3 Year 4 Year 5
Revenue
Gross revenue
$930,0
00
$948,6
00
$986,54
4
$1,045,
737
$1,129,
396
Cost of goods sold
$266,0
00
$271,3
20
$282,17
3
$299,10
3
$323,03
1
Gross margin
$664,0
00
$677,2
80
$704,37
1
$746,63
3
$806,36
4
Other revenue [source] $0 $0 $0 $0 $0
Interest income $0 $0 $0 $0 $0
Total revenue
$664,0
00
$677,2
80
$704,37
1
$746,63
3
$806,36
4
Operating expenses
Sales and marketing
$16,20
0
$16,52
4 $17,185 $18,216 $19,673
Payroll and payroll taxes
$15,00
0
$15,30
0 $15,912 $16,867 $18,216
Depreciation
$19,72
0
$20,11
4 $20,509 $20,903 $21,298
Maintenance, repair, and
overhaul $8,720 $8,894 $9,069 $9,243 $9,418
Total operating expenses
$59,64
0
$60,83
3 $62,675 $65,229 $68,605
Operating income
$604,3
60
$616,4
47
$641,69
7
$681,40
4
$737,76
0
Interest expense on long-term
debt $0 $0 $0 $0 $0
Operating income before other
items
$604,3
60
$616,4
47
$641,69
7
$681,40
4
$737,76
0

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Loss (gain) on sale of assets $0 $0 $0 $0 $0
Other unusual expenses
(income) $0 $0 $0 $0 $0
Earnings before taxes
$604,3
60
$616,4
47
$641,69
7
$681,40
4
$737,76
0
Taxes on income
30
%
$181,3
08
$184,9
34
$192,50
9
$204,42
1
$221,32
8
Net income (loss)
$423,0
52
$431,5
13
$449,18
8
$476,98
3
$516,43
2
Cumulative income
$423,0
52
$854,5
65
$1,303,
753
$1,780,
736
$2,297,
167

19MBAF503 BUSINESS FUNDAMENTAL
Appendix
Sources of Capital
Owners' Investment (name & %
ownership)
Your name & % ownership
$
100,000
Other Investor
Other Investor -
Other Investor -
Total Investment
$
100,000
Bank Loans
Bank 1
Bank 2 -
Bank 3 -
Bank 4 -
Total Bank Loans
$
-
Other Loans
Source 1
$
-
Source 2 -
Total Other Loans
$
-
Summary Statement

20MBAF503 BUSINESS FUNDAMENTAL
Sources of Capital
Owners' and Other Investments
$
100,000
Bank Loans -
Other Loans -
Total Source of Funds
$
100,000
Startup Expenses
Bldgs / Real Estate
$
38,000
Leasehold Improvements
17,
000
Capital Equipment
43,
600
Location / Admin Expenses
28,
300
Opening Inventory
58,
200
Advertising / Promo Expenses
16,
200
Other Expenses
15,
000
Total Startup Expenses
$
216,300
Athanasakou, V. E., & Olsson, P. (2016). Managerial Discretion and Firm Fundamentals.
Hackbarth, G., & Gamble, K. F. (2017). When healthcare professionals understand business
fundamentals. Journal of Higher Education Theory and Practice, 17(9).

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Ikenami, R. K., Garnica, L. A., Ringer, N. J., & Hashiba, L. H. M. (2016, June). Innovation
Ecosystems and Collaboration Strategies: the Case of Natura Cosmetics. In ISPIM
Innovation Symposium (p. 1). The International Society for Professional Innovation
Management (ISPIM).
Laba, D. (2017). Rheological properties of cosmetics and toiletries. Routledge.
Lordkipanidze, R. (2018). Dialectics to understanding of International competition: for
fundamentals and practice of business and public law.
Pimentel, B. S., Gonzalez, E. S., & Barbosa, G. N. (2016). Decision-support models for
sustainable mining networks: Fundamentals and challenges. Journal of Cleaner
Production, 112, 2145-2157.
Razmochaeva, N. V., Semenov, V. P., & Bezrukov, A. A. (2019, January). Role of Process
Automation in Quality Management of Enterprises in Perfumery and Cosmetic
Industry. In 2019 IEEE Conference of Russian Young Researchers in Electrical and
Electronic Engineering (EIConRus) (pp. 1449-1452). IEEE.
Schwarz, S., Lathrope, D., & Hellwig, B. J. (2017). Fundamentals of Business Enterprise
Taxation: Cases and Materials. West Academic.
Shabib, F., & Ganguli, S. (2017). Impact of CSR on consumer behavior of Bahraini women
in the cosmetics industry. World Journal of Entrepreneurship, Management and
Sustainable Development, 13(3), 174-203.
Vong, A., Hellberg, A., & Melander, J. (2016). Why Do Consumers Avoid Certain Brands?:
A Study of Brand Avoidance Within the Swedish Cosmetics Industry.

22MBAF503 BUSINESS FUNDAMENTAL
References
Athanasakou, V. E., & Olsson, P. (2016). Managerial Discretion and Firm Fundamentals.
Hackbarth, G., & Gamble, K. F. (2017). When healthcare professionals understand business
fundamentals. Journal of Higher Education Theory and Practice, 17(9).
Ikenami, R. K., Garnica, L. A., Ringer, N. J., & Hashiba, L. H. M. (2016, June). Innovation
Ecosystems and Collaboration Strategies: the Case of Natura Cosmetics. In ISPIM
Innovation Symposium (p. 1). The International Society for Professional Innovation
Management (ISPIM).
Laba, D. (2017). Rheological properties of cosmetics and toiletries. Routledge.
Lordkipanidze, R. (2018). Dialectics to understanding of International competition: for
fundamentals and practice of business and public law.
Pimentel, B. S., Gonzalez, E. S., & Barbosa, G. N. (2016). Decision-support models for
sustainable mining networks: Fundamentals and challenges. Journal of Cleaner
Production, 112, 2145-2157.
Razmochaeva, N. V., Semenov, V. P., & Bezrukov, A. A. (2019, January). Role of Process
Automation in Quality Management of Enterprises in Perfumery and Cosmetic
Industry. In 2019 IEEE Conference of Russian Young Researchers in Electrical and
Electronic Engineering (EIConRus) (pp. 1449-1452). IEEE.
Schwarz, S., Lathrope, D., & Hellwig, B. J. (2017). Fundamentals of Business Enterprise
Taxation: Cases and Materials. West Academic.
Shabib, F., & Ganguli, S. (2017). Impact of CSR on consumer behavior of Bahraini women
in the cosmetics industry. World Journal of Entrepreneurship, Management and
Sustainable Development, 13(3), 174-203.

23MBAF503 BUSINESS FUNDAMENTAL
Vong, A., Hellberg, A., & Melander, J. (2016). Why Do Consumers Avoid Certain Brands?:
A Study of Brand Avoidance Within the Swedish Cosmetics Industry.