Business Plan

Kaleb Hand, Bret Smith, and Jordan Miller

Amplify

126 Beaver Drive

(814) 371 - 2700

Tuesday, January 29th 2019

 I. Executive Summary

II. Business Description

III. Sales and Marketing

IV. Management

V. Financials

VI. Resources

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I. Executive Summary

A.
Our business is known and called Amplify. In our business we distribute

and manufacture speakers that are applied to a instrument so the speaker can

amplify what the sound is while playing to a larger crowd. Our goal in our

business to make sure we help anyone that we can with making instruments sound

the best they can, at a cheaper price than any other speaker for this use in the

market. We are a three person company that are in charge of their own divisions

and things. There is Bret, Jordan and me Kaleb. I (Kaleb) am in charge of the

sales part of our company. This means that I am in charge of making sure that our

product is sold to customers around the area and to get our product out there

where people know about it. This makes our profit margins increase by a

tremendous amount. Jordan is our man in charge the CEO. He makes sure

everything is up and running on a day to day job hires our workers, and has the

tough job of making sure everything is in order properly. Bret is our market and

advertising chief. He in a day to day job makes sure our product is out there and

comes up with new ways each day to make sure people know about our product

and what it does for the price that it is. The question to ask is why do you not

want to join us and want a speaker like ours that can help so many people around

the area and eventually the country. The profits that are possible in this business

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opportunity are tremendous. There is no other speaker that is like ours and does

the task at hand like ours does. Our speaker as a whole is such a good quality for

a cheaper price than any other at only $50.00. This speaker will help so many

people in the musical field, area that instruments are the quieter ones be heard in a

large group. So many musical shops, orchestras, bands, marching bands even

individual musicians would want this product and in big quantities. This is

because there is more than one person that wants this product or plays a quite

instrument in a band or orchestra. Word could then get out about our product and

our profits would climb at a tremendous rate because of it in a short amount of

time. You should invest in our product because of the tremendous upside in our

product and the quality that our speakers are. With the expenses of our product

not being very high to manufacture and distribute this is a great opportunity.

Especially, since most of our orders will be in big shipment sizes due to what our

customer base will be. This increase the amount of revenue coming into our

business and manufactory warehouse. Where we can make more of our product

at a quicker rate during our expansion period after our business Amplify gets

going and word gets out about our speaker.

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II. Business Description
A. Business Description Industry
The industry Amplify, will be competing in the manufacturing industry for

speakers and other unique items for instruments. In our business we will be

making and supplying speakers to all parts of the state the first year. Whether it

would be in school, bands, orchestras, music shops and much more. Our vision is

to see Amplify become very successful in this field and make the instruments that

are not heard because of the louder instruments over powering them heard by

using speakers that are made and designed by our company. To provide an

opportunity for people that play the softer instruments have the ability to be loud.

This industry that we are starting in is an extremely hot industry. Many people in

bands are starting to realize that the softer instruments need something to make

themselves heard. That is why we have come up with the speaker that helps the

softer instruments have a louder sound. Conductors of bands would really

appreciate our industry because trends are going on a tremendous incline with the

music industry and people wanting to participate in it. There are many factors

that could impact this development of out product. Anywhere from sales,

distribution to different places the want or need for the product. Whether the

market is trending in our direction or down as a whole. All of these are key

factors that we have and will continue to look at as a company. We as a company

know that we are getting into a business that is on the rise. This is because last

year alone the music industry had 43 billion dollars worth of sales across the

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 country. With our speakers this will make the sales profit margin even bigger,

providing these speakers to instruments of all varieties.

B. Mission Statement
The purpose of our business Amplify is to provide an opportunity to

musicians around the country that are not heard when performing. We are

targeting groups such as high schools, bands, orchestras and music stores. This

will give people the chance/opportunity to broadcast their talent to whoever they

want at anytime and love doing it! All of this will be provided by us to give

people the chance to become noticed and known around the country and draw

more people into the musical world.

C. Type of Business
We are planning a manufacturing LLC company. We chose a LLC mainly

for the fact of the reduced taxes and management restrictions. It also requires

much less record and administrative paperwork. Taxes are taken from members,

rather than the company itself, making it a lot less complex overall. The limited

liability of a corporation is also a leading factor in our choice. During this we will

be manufacturing our own speakers to reduce costs of having another company

make them. So, we will have our own warehouse where we can make the

speakers and then distribute them to where needed, where the orders are with our

trucks from the warehouse. Thus, cutting down the costs tremendously in our

company.

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D. Location
We intend to acquire a warehouse space at Satterlee Rd, either a open

space or an already rented space. A small office space will be built within the

warehouse as well as the warehouse being refitted for our manufacturing needs. It

also has spaces to hold our delivery trucks,

E. Product Description
Our product is a small circular speaker that attaches to the bell of an

instrument to Amplify© the sound of the instrument. The speaker will consist of

3 rings and clips to clip it to the instrument. This rings will also be water resistant

due to saliva and/or rain. On the middle ring 4 microphones will be around the

ring. On the outside of the middle ring will be 4 speakers spread around the ring.

In the future we would like to incorporate BlueTooth into this speaker, for

enhanced sound. We believe the most selling season would be during the fall

because of Marching Band season. The reason for this is because some pieces of

music have woodwind solos or solis for most songs. For example, in the song

You Give Love A Bad Name, written by Bon Jovi and arranged by Paul Murtha,

contains a flute and clarinet soli but this is drowned out by the 1st and 2nd

trumpets. If Amplify© was present then this soli would be brought out a lot

more. This is just one of many examples of the woodwinds be drowned out by

the trumpets because the clarinets share a lot of rhythms with the clarinets in

many songs because both instruments are in the same key, that being Bb.

F. Position

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 One advantage of our product is it’s something almost completely lacking

in the market. Our competition is almost nonexistent. A speaker that boosts the

sound of instruments is something almost any musician, from high school

students to high-end professionals would be in the need for. We are hoping to

provide a solution to a common problem among many musicians.

G. Pricing Strategy
The market of this product is very slim so the price of our product will be

$49.99 plus applicable taxes. The reason for this price is so that we have enough

for materials and for the manufacturing staff. We believe that this should be

$49.99 because if it were any higher it would be very costly, and if any lower we

wouldn't make profit.

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III. Market and Industry Analysis
A. Customer Profile
Our target customer is someone or a group of people that love to play instruments

and we know that that person will enjoy our product. We want to target those who plays

instruments as well as industries that sell the product and instruments throughout the

country. As to those who play softer instruments we want to really seek out and make

the speaker available to them. Such as those who play a clarinet, flute, saxophone even

a tuba. This is because we want these people and their instruments to be heard during

live performances. Whether it's in a band, orchestra, parades etc we want to help them

in anyway we can and sell our product to them. These target customers are people we

want using our name, our product our industry. We will sell to anybody that would want

a speaker like our so an everyday customer that would possibly just walk into a store

looking for a speaker and other groups that would be targeted. The age we prefer to

target is anywhere from 10-50 years old. Our customers are people that love to play

instruments and be around bands of some sort throughout their careers. We want to give

them the opportunity and address the concerns that people in our market have of their

instruments not being heard over the louder, bigger instruments when performing. Our

goal is to reach out to people that are the head of their own band, music shop, orchestras

not so much the members but the head of each group. They can choose us because our

product will produce what they need and bring all the instruments together make them

all sound as one and these speakers are very much cheaper than most and smaller,

designed for the right reason. Our customers can purchase our speakers online when

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they go to our site and can guarantee a great product and great delivery to wherever need

be.

B. Market Segment
Our market segment could be two to three different target areas. Such as,

teenagers and youngs adults for one segment. Adults such as parents, grandparents family

members to buy our product for the younger people. Even adults who are in charge of

large organizations like bands, orchestras, parades so our product gets delivered to a

larger field of people. For each of these different segments the potential customers is

very high and wide. There is room to grow in each of these segments and distribute our

product to the people that love instruments and to hear the sound of what they are

playing. Our main goal is to target the young to older adults because these are the people

that would be buying our product and giving it to younger people ( kids, teenagers ) or

bigger groups that are involved in instrument playing. The market value then for this

area would be very high given this is where the people that would buy our product would

be placed. Our annual spending would then be around 125,000 for making the product

towards the target market segments we are looking at. This leaves a tremendous market

value for our product in the market we are in because of the price of our product being

less expensive than any other in its field and it being one of the best speakers for

instruments around with all kinds of qualities.

C. Customer Needs
We as a company listen to our customers needs no matter what it is. We believe

the thing our customers need the most is a speaker. This speaker will amplify increase

the sound of weaker smaller instruments. This is something our customers are lacking in

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clarinets, flutes, piccolos and many more. We want to help them with this need and help

make the music world hear every instrument that should be heard and what they can do.

This speaker is needed because there is nothing of the sort in the music industry. There

are small microphones but that does not amplify the sound to be heard in bands and other

groups. This speaker will help with our customers needs and wants to be created and

sold to whoever wants our product and have their instrument be the new in in the music

world.

D. Market Size/Trends
The Target market for our product is aimed more at bands(jazz,

marching,concert). This is because of a very real problem in the woodwind

section(flutes, clarinets, saxophones) where they get drowned out by the louder brass

section(trumpets, trombones, french horn, etc.). IUP for example has a massive marching

band and they have dozens of clarinets and with those they have a lot of solis that get

drowned out by brass instruments. A speaker, such as Amplify, could bring out these

solis/solos. The most popular time for these products would be in the fall(October, early

November) and the worst time for this market would be in the winter. This is because the

marching band season takes place in the fall.

E. Competition
We don't have much competition but we do have some. Woodwind Brasswind is

a company that sells a lot of products including a few mics. They have a few condenser

mics but they are outrageously expensive, the cheapest one being around $150. Our

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product is only $50 and this is a very drastic change in prices between the two. This does

not make our products quality any less than the more expensive speakers. In fact our

product is made with better material and designed by the best of the best. Our product is

also more unique because it has the ring like shapes around it and can clip on the bottom

of the instrument securely and would be unstable like most of the mics that only use one

clip. On the reviews of a condenser mic the user said that the neck wasnt flexible enough

to get inside the bell of the instrument(the bottom part of the instrument) and that the

neck would snap if you bent it to much into the bell. The shape of these mics is like no

other that you will find anywhere on the market oddly shaped and not very useful

products. They are constructed with wires that have boxes at the end of each of them that

attach the microphones to the speaker. These mics run on phantom power, which is a

battery box that is included with the microphone. These are known not to last long at all

when in use. Our mic will run on small lithium batteries that are installed in the rings.

These batteries should last around 8 hours maximum but they wont need to be on that

long. Our mic will also be fitted with a charging kit to charge the mic and batteries.

F. Labor Requirements
We plan to hire younger labourers and instruct them to use our factory machines.

We plan to start a training program at nearby community/trade school, such as Penn State

DuBois, or Jeff Tech. We would do this by getting the word out to younger people around

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the area, go and talk to middle and high school students to prepare them for what we

would need in a worker. Then we would make sure to oversee them throughout the

process of learning what to do whether it would be in Jeff Tech or Penn State DuBois. An

extensive program will be available to any hirees who wish to use more specialized

machinery. Our workers are needed for operating the factory floor, working the

warehouse, and delivery. Salesman will be needed to sell our product across the state and

eventually the country that will be joining Kaleb in making our business thrive through

the sales. Accountants will be needed to manage and record the finances of the company.

Quality control is a fundamental, and something we take very seriously, insuring that our

customers get the best products.

G. Estimated Sales

Year 1 Units predicted: 5,000 Gross Sales: Approximately $250,000

Year 2 Units predicted: 15,000 Gross Sales: Approximately $750,00

Year 3 Units predicted: 25,000 Gross Sales: Approximately $1,250,000

These predictions are based on the current lack of direct competitors, number of

potential customers, and ability to distribute across the country. Currently, any

product similar to Amplify are nowhere close quality wise, closer to mics taped to

the instrument than a speaker. The amount of students and musicians in need of

such a product cannot be overstated, as the need is there with no alternatives. And

as the focus is to distribute, we have the ability to sell across the country,

potentially around the globe.

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IV. Sales and Marketing
A. Strategy
In our industry we will be targeting people of our age or a little older 14-25 for

our initial push. This is because this is the age group in which most people are playing an

instrument and the people that would need our product the most. For follow up target

phases we have to other groups 30-45 and 50-65. This is because these are people such

as parents, grandparents and family members that would buy the product for our initial

push target range.

As a company we will find our customers in many ways. For example, we will

look and distribute our product to music shops or big groups. We will do this by giving

them ideas of how our product works. By commercials, advertisements and much more

that gives a description of our product. We our going to emphasize the fact that the

speaker has little microphones inside of it which amplify the overall sound to a wider

area. Also, it has speakers on the outside that catch what the microphones are projecting

from the instrument to the outside.

We will sell our product by online services as well as delivery services depending

on what the order and the shipment are. This because we don’t find the need for a store.

We will have a building that manufactures the speakers/products that we need and we

will ship them out to local stores and schools around Pennsylvania. We find that it will

cut down on costs ( taxes,expenses etc ) not having a store to sell the speakers, leave

more room for money to go into the actual product. It means that we would just have a

manufacturing place to make the speakers, store and distribute them to the places needed.

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This will extend our market to farther regions and increase our profit margins throughout

the years. At first we will be looking to sell our product locally for start up purposes and

get our product out there. This is because we want to gain profits with our product before

offering it around the country. Eventually our goal is to have a product nationally. This

will drive sales up and really bring our product to anyone who thinks they want or need

it. Whether it would be a person in a marching band, orchestra, a family member or

parent buying it for a loved one. Our goal would be to get involved with bigger colleges

and get our product out to people throughout the country that way of the younger

generation.

B. Method of Sale
As previously stated, our company intends to distribute through delivery and

ecommerce. We have plans to buy 4-8 delivery trucks, as well as the drivers required. As

we plan to start locally, we will only be distributing to a few small music stores around

the state, but eventually plan to expand nationally. We are currently setting up a website

that would be another method customers could buy products from. We will have no direct

sales force as we feel it’d limit our outreach in the long run. Another advantage is our

main target group ,teenagers to young adults,would rather shop online, as it’s one of the

most popular forms of shopping.

C. Advertising & Promotion

We plan to hold a Charity Ball and invite band directors from all over the area to

come and enjoy themselves while we unveil our product and potentially get some early

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buyers. Our next advertising method will be business cards that we distribute in each of

our packages as the manufacturers make them. Our packaged will consist of a white base

box with our logo on the front and the product description on the sides. We will try to be

involved in the community as much as possible and will even run a program to help

children or adults play woodwind instruments and be more confident in what they play.

We will sponsor local marching band competitions and put money towards getting new

instruments for the DAMS and DAHS bands. We hope to encourage others to play an

instrument because studies show that when a person plays an instrument they develop a

better sense of work ethic and focus. At events we sponsor we will have t-shirts and hats

and such to promote our business and we will even develop custom reed cases with our

logo on them to distribute with our products.

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V. Management
A. Management Team Description
Kaleb will be the advisor of sales, Bret will be on the Administration team, and

Jordan will be in charge of production. Kaleb is good with the numbers and would be a

great salesman. Bret likes being in the high seat so he would be on the Administration

team. Jordan will be more focused on Production rather than administration. We will

need a Marketing specialist, so we will hire a person preferably with a degree in finance

and marketing.

Kaleb being in Sales is a wise decision because of his brains and willing to be

persistent and really get out there and sell the product. Bret being on the Administration

team is good because he can handle anything bad that happens under the companies

name. Jordan will focus on the production of the product and will be sure the product is

handled, and shipped correctly. The professional we hire for Marketing will focus on

advertising and such and making sure the product is getting the spotlight.

B. Ownership
The ownership of this company will be a board of directors who own a certain

share of the company, since it is an LLC. For the decision part of the company the

majority of the decisions to benefit the company will be casted as a vote and the majority

will rule. Bret will be a member of this board of directors and will be able to bring up

ballots and discuss with the rest of the board.

C. Risks

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 We know as a company that there will be many risks involved. Some of the risks

that are included with taking part in our venture, company are the fact that there may be a

faulty speaker here or there that is distributed to our customers. This could cause

customers to not want to stay with us because of a faulty product. Another risk that we

run when having this product is someone else coming up with the product at a cheaper

rate/price. This then could affect the sales of our product and the want for our product by

major customers. Another risk we could come across is not making the deadline that we

have when distributing the product of bigger shipments to our bigger companies/

customers. Because of this it could affect how big our shipments could be therefore,

cutting down on what customer base we could supply. This all leading up to the fact that

another company with a similar product could come in and win our customers/ clients

over making us lose our business, sales, revenue and much more. Finally, our sales

estimates could not exceed what we think we could get in a year. What this could do to

our business is tremendous. It would make us as a company lose our revenue/profit, have

us have more product of speakers just sitting around because they wouldn’t have sold in

our year of sales, possibly having us go in debt therefore, possibly laying off workers or

figuring out a new method of who to sell to get our product out there so people know

about it more.

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VI. Financials
A. Expenses
In our company we have many costs that we need to keep track of and worry

about on a day to day basis. The costs that we come across the most are the costs for

productivity of our product and the shipment/delivery of our product to our customers.

We also come across the renting expense of our warehouse where we make our product,

the utilities to keep everything running and insurance or personal use of money within the

company. This is so that we don’t go in debt with our money and product just because

we wouldn’t balance out our finances and what goes with what.

All of these have to do with the money that we as a company have figured out to

be enough to get our company started and running on a month to month basis.

B. Operating Expenses
Rent Utilities Insurance Personnel Misc

~$3,000 ~7,000 $500 ~$4,000 ~$6,000

*All estimates are based on monthly cost
These are rough projections, as costs can fluctuate at any point. Miscellaneous

costs include fuel for our delivery vehicles, selling expenses. Administration costs are

also included.

C. Capital Requirements
Our base capital requirements are between $200,000-$300,000. Those numbers

are based on the need to buy equipment to make the speakers, the office equipment,

delivery trucks and office and production supplies. These are the essentials for starting

and maintaining our business.

D. Cost of Goods

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 Each Amplify speaker costs roughly $35.25 to produce, and we buy our materials

in bulk overall for close to $450 for each shipment. Each shipment makes approximately

20 speakers. It takes 2 hours to produce each individual speaker, and it is then tested for

quality and functionality. Efficient delivery is a top priority of our company.

VII. Resources

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