Franklin & Moore, LLC - Sample Plan

This sample marketing plan was created using Marketing Plan Pro®marketing planning software published by Palo Alto Software, Inc. This plan may be edited using Marketing Plan Pro and is one of 70+ sample plans available from within the software. To learn more about Marketing Plan Pro and other planning products for small and medium sized businesses, visit us at www.paloalto.com.

This is a sample marketing plan and the names, locations and numbers may have been changed, and substantial portions of the original plan text may have been omitted to preserve confidentiality and proprietary information. You are welcome to use this plan as a starting point to create your own, but you do not have permission to resell, reproduce, publish, distribute or even copy this plan as it exists here. Requests for reprints, academic use, and other dissemination of this sample plan should be emailed to the marketing department of Palo Alto Software at marketing@paloalto.com. For product information visit our Website: www.paloalto.com or call: 1-800-229-7526.

Ma

rke

Copyright © Palo Alto Software, Inc., 1995-2008.

tin

gP

lan

Pro

Academic Version

Sa

mp
All rights reserved.

le

Confidentiality Agreement

Upon request, this document is to be immediately returned to _______________. ___________________ Signature ___________________ Name (typed or printed) ___________________ Date

Ma

rke

tin

gP
Academic Version

lan

This is a marketing plan. It does not imply an offering of securities.

Pro

Sa

It is acknowledged by reader that information to be furnished in this marketing plan is in all respects confidential in nature, other than information which is in the public domain through other means and that any disclosure or use of same by reader, may cause serious harm or damage to _______________.

mp

The undersigned reader acknowledges that the information provided by _______________ in this marketing plan is confidential; therefore, reader agrees not to disclose it without the express written permission of _______________.

le

Table of Contents

2.0

3.0

4.0

Ma

Marketing Mix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.1 Product Marketing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.2 Pricing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.3 Promotion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.3.1 Advertising . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.3.2 Public Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.3.3 Direct Marketing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.4 Web Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.4.1 Website Goals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.4.2 Website Marketing Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.4.3 Development Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.5 Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.6 Implementation Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.7 Sales Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.7.1 Sales Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.7.2 Sales Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

gP

Marketing Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.1 Value Proposition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.2 Critical Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.3 Financial Objectives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.4 Marketing Objectives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.5 Target Market Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.6 Messaging . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.6.1 Branding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.7 Strategy Pyramids . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Pro

Situation Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1 Market Needs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2 The Market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2.1 Market Demographics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2.2 Market Trends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2.3 Market Growth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2.4 Macroenvironment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3 The Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3.1 Mission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3.2 Service Offering . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3.3 Positioning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3.4 SWOT Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3.4.1 Strengths . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3.4.2 Weaknesses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3.4.3 Opportunities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3.4.4 Threats . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3.5 Historical Results . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4 Competition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4.1 Direct Competition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4.2 Indirect Competition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

le

1.0

Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 1 1 2 3 3 4 5 5 5 6 6 7 7 7 7 8 8 9 9 11 11 12 12 12 12 13 13 13 14 16 16 16 17 17 18 18 19 19 19 19 20 20 21 21 21 22 23 24 25 26 27 28

5.0

rke

Financials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.1 Break-even Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.2 Sales Forecast . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.2.1 Sales by Partner . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.2.2 Sales by Segment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.2.3 Sales by Specialization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.3 Expense Forecast . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

tin

Academic Version

lan

Sa

mp

Table of Contents

5.4 5.5 6.0

Appendix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Sa

Controls . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.1 Implementation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.2 Keys to Success . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.3 Market Research . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.4 Contingency Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.5 CRM Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

mp

le

5.3.1 Expense by Partner . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.3.2 Expense by Segment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.3.3 Expense by Specialization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Linking Expenses to Strategy and Tactics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Contribution Margin . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

29 30 31 32 32 34 34 35 35 36 36 37

Ma
Academic Version

rke

tin

gP

lan

Pro

Franklin & Moore

Our target markets include the following.

• Businesses of more that 50 employees and/or $5 million in annual sales, particularly those in the medical/health, dental and lodging industries. • Growth oriented businesses that will benefit from our areas of pension and retirement planning specialization. • Individuals with a net worth of greater than $1.2 million. Diversifying our revenue streams and leveraging our core strengths will optimize our position for the future. We will also implement marketing tactics to better leverage the firm's total capacity throughout the year, versus a heavy concentration.

2.0 Situation Analysis

2.1 Market Needs

Ma

rke

Franklin & Moore LLC provides tangible and intangible value. Our objective is to minimize the tax exposure of our clients and adhere to all state and federal tax laws. The bigger picture means that we are providing peace of mind for our clients - they are legally using their financial resources in the most productive manner possible. We work to make the complex understandable. We act in an advisory role to our clients that will enable them to better influence and optimize their personal and/or corporate wealth. We desire to make them more money and give them a better night's sleep.

tin

gP

Franklin & Moore LLC offers expertise in all areas of accounting, bookkeeping, and financialbased planning. The firm has a solid and loyal customer base in a market that has experienced constant but slowing growth in recent years. We have increasing competition from a variety of sources. The firm is highly dependant on revenues from tax planning and preparation for businesses and individuals. These areas account for more than 75% of total revenues. This presents a long-term threat to the firm due to competition and changes in our market. We must diversify our revenue base to realize ongoing growth and stability in a changing industry.

Academic Version

lan

Pro

Sa

mp

Franklin & Moore LLC is an accounting firm offering traditional accounting services and business consulting. The firm's reputation is impeccable and is known throughout the San Clemente, California area as one of the top three accounting firms. Franklin & Moore LLC serves the accounting and financial needs of businesses and individuals to enable them to realize their financial goals.

le

1.0 Executive Summary

Page 1

Franklin & Moore

Table: Market Analysis Market Analysis 2006 Potential Customers Large Business Growth Business Select Individual Accounts Total Growth 8% 11% 6% 8.28% 435,000 342,000 380,000

2007 469,800 379,620 402,800

Sa
2008 507,384 421,378 426,968 1,355,730

mp
2009 547,975 467,730 452,586 1,468,291

Franklin & Moore LLC is a full-service accounting firm, serving the personal and business needs for the community of San Clemente, California and beyond. Our most important clients are mid to large-size organizations that rely on our services for their accounting needs. Tax preparation and planning is just the beginning as we strive to become an integral part of their financial management and planning process. Our best clients value their time and resources, and seek to minimize their tax obligations. They do not like negative surprises. They realize and appreciate the value in the services we offer, along with the lost opportunity costs of not benefiting from our services.

le
2010 591,813 519,180 479,741 1,590,734

2.2 The Market

Pro
1,252,220

CAGR 8.00% 11.00% 6.00% 8.28%

1,157,000

Market Analysis (Pie)

gP Ma rke tin
Academic Version

lan
Large Business Growth Business Select Individual Accounts

Page 2

Franklin & Moore

Organizations of Over 50 Employees - Our most profitable business clients fall into the "over 50 employees" category. These corporate accounts generate the highest revenues on a per-hour basis and also generate revenues on the most consistent basis throughout the year. Many of these accounts are in the medical/health, dental, and lodging industries. These clients are also more likely to look to Franklin & Moore for the widest range of services the firm offers, such as assisting with pension planning and investment management services. Target clients in this category have annual sales over $3 million, operate more than one location, serve a national customer base or more, and are publicly owned. Organizations Under 50 Employees - Organizations under 50 employees represent some of the fastest growing clients within the firm. Franklin & Moore offers attractive services that understand and meet the needs of these clients. Again, many of these clients are in select vertical markets, including medical/health, dental, and lodging industries. The key clients in this category have annual sales between $250,000 and $3,000,000, serve customers in the Southern California market, have a local or statewide customer base, and are privately owned. The long-term strategy is to grow with these clients as they expand and their needs for our services increase.
Table: Market Demographics Market Demographics Market Segments Large Business Growth Business Select Individual Accounts

gP

Benefits Quality Future Planning

lan

Product Attitude Questioning Interested Positive

Pro

Sa
Loyalty Status Volatile Medium High

mp
Buyer-readiness Informed Unaware Ready to buy

Individual Accounts - The base of individual accounts serves to offer consistent revenues for the firm. Approximately 20% of these accounts also depend on the firm for ongoing financial planning of their investment portfolios. The balance of the clients primarily look to the firm for tax planning and preparation.

Tax Minimization

le

2.2.1 Market Demographics

Characteristic -

Market trends fall into three general categories: increasing use of software, and key client growth.

Ma

rke

Increasing use of software - Tax software is one of our major competitors and continues to erode revenue from individual clients with simple returns. This includes products produced by Intuit with their "Turbo Tax" line and H&R Block Financial with their "Tax Cut" products. Software has also been a resource to increase efficiencies within the firm. For example, we are producing in excess of 50% more work, and therefore billable hours, with the same resources we did in 1995 due to the computer systems now in place. Key client growth - A cluster of our premier clients have experienced substantial success and growth. Meeting these clients' needs will "bring us along" to offer additional services and provide an opportunity for us to strategically expand the services we offer. As we gain expertise and establish our reputation in these areas, we market those to other clients and use them as a point of interest to attract new clients. Pension planning services are one example of this phenomenon.

tin

2.2.2 Market Trends

Academic Version

Page 3

Franklin & Moore

Market Analysis (Trends)

600,000 500,000 400,000 300,000 200,000 100,000 0 2006 2007 2008

2.2.3 Market Growth

tin

rke

Ma

gP
15.00% 10.00% 5.00% 0.00%

The growth rate of our combined target markets has averaged approximately 8.6%. This is due to the growth of established businesses as well as movement into the San Clemente area. This growth rate has plateaued in recent years and is expected to remain constant for the foreseeable future.

Academic Version

lan

Market Analysis (C.A.G.R)

Pro
2009 2010

Sa

mp
Large Business Growth Business Select Individual Accounts

le
Page 4

Franklin & Moore

The following issues impact market acceptance and Franklin & Moore's ability to generate revenue: Consumer trends - Those clients that are PC literate are more likely to consider tax preparation software as a viable alternative to using our services. Economic changes - Two economic changes are taking place, due to the increasing assets of the over-70 "depression generation" and their saving behavior. First, they have proportionately greater assets than their predecessors, particularly individuals with assets in excess of $1.2 million. This group and their heirs may realize increased benefits from tax and estate planning. There is also a phenomenon where the children of this aging population are more likely to inherit assets and need to integrate these newly acquired assets with their own. Both present opportunities for tax and estate planning activities. Technology advancements - Franklin & Moore has benefited from firm-based software that is enabling us to become increasingly more productive with our existing resources. Unfortunately, technological advancements are also creating greater challenges in the competitive environment. Competitive activity - Competition has increased on all fronts. In addition to the impact enduser software is having on the industry, firms of similar size have grown and expanded and there are more sole proprietors and licensed tax consultants and bookkeeping services. We consider the market to be at or near saturation. Political and legal environment - Our business activity is directly related to changes in state and federal tax laws. The most negative activity in this area would be tax laws that lead to significant simplification of tax laws.

2.3 The Company

2.3.1 Mission

Ma

rke

Franklin & Moore is to be a profitable firm that continues to meet the financial objectives of the shareholders and provides a successful environment for its employees. Our firm will maintain strong growth as a provider of high quality professional services to our clients. We will strive to consistently be perceived as a firm that is professional, trustworthy, accurate, and timely. Franklin & Moore will offer the innovative approach clients need to reach their business and personal financial goals. Wealth is good.

tin

Franklin & Moore LLC is an accounting firm offering traditional accounting services and business consulting. The firm's reputation is impeccable and is known throughout the San Clemente, California area as one of the top three accounting firms. Franklin & Moore LLC serves the accounting and financial needs of businesses and individuals to enable them to realize their financial goals.

gP

Academic Version

lan

Pro

Sa

mp

le

2.2.4 Macroenvironment

Page 5

Franklin & Moore

Our services offer expertise to enable our clients to better realize their financial objectives. Accomplishing this for our clients falls into these basic service areas: Business Clients • Tax advising, planning, and preparation • Consulting services, including: • Industry-specific consulting • At-risk business consulting • Corporate-pension consulting Individual Clients

Our services must be strong enough that each of our clients will answer positively to these questions.

Ma

rke

Franklin & Moore LLC offers a unique team of CPAs and a professional accounting and bookkeeping staff with proven expertise as business consultants. We do more than prepare taxes. We also provide a variety of valuable services that enable a business to optimize their profitability and minimize their tax exposure. We will work to offer our services in an innovative manner to create a source for business planning solutions that will be difficult to emulate. We offer a premium level of service and expect to receive premium compensation for those services.

tin

2.3.3 Positioning

gP

• • • • •

Do they act in a professional manner? Do they know who I am? Do they remember my name? Are they genuinely concerned about my best interest? Will they actively support and defend their advice and council if needed?

Academic Version

lan

Providing quality service is also critical. Our business and individual clients judge our competence based on how we treat them. This is their primary - and in many cases their only measurement of our capabilities. They ask themselves the following about our firm:

Pro

• Tax advising, planning, and preparation for individuals • Consulting services, including: • Personal Financial Planning (general) • Pension planning • Retirement planning

Sa
Page 6

mp

le

2.3.2 Service Offering

Franklin & Moore

2.3.4.2 Weaknesses

2.3.4.3 Opportunities

Ma

• Benefiting from the ongoing increase in population to the San Clemente area, particularly for the retirement segment. • Increasing income levels of the population over the age of 60 that have aggressively saved for retirement and have increasingly complex tax planning, tax preparation, and estate planning needs. • Leveraging the positive perception business has about locating in this section of Orange County. • Growth that is occurring in three industries where we possess expertise; health/medical, dental, and lodging.

rke

tin

gP

• Over-dependence on tax preparation work for individual and business clients and, therefore, a lack of diversification in our revenue sources. • Inability to generate sufficient billable hours in the off-season, based on the current capacity of our systems and full-time staff. • Difficulty in retaining aggressive non-partner CPAs, as they move to smaller firms that will make them partners sooner. • Being perceived as a non-progressive, "too traditional" firm and maybe overlooked as a viable option for new clients. • Some individuals within the professional staff do not have an understanding of or a commitment to the marketing activities of the firm.

Academic Version

lan

Pro

• A core of CPAs that have established solid reputations within our market • Highly experienced staff with an increase in total billable hours. • A state-of-the-art computer system, utilizing the latest software that continues to enhance our productivity and expand our capacity. • High client retention, providing consistent referrals to the firm. • Expertise in specific vertical markets of medical/health, dental, and lodging industries. • Three CPAs, our "rainmakers," who bring in an estimated 65% of the new client work.

Sa

2.3.4.1 Strengths

mp

The SWOT analysis addresses the strengths and weakness within Franklin & Moore and the opportunities and threats that exist in our environment. This analysis highlights areas to be leveraged and points out where we must improve within the firm and within our industry and market.

le

2.3.4 SWOT Summary

Page 7

Franklin & Moore

Our past marketing activities have produced mixed results. The following is a summary of those activities and categorizes them in terms of "successful" and "unsuccessful." A successful marketing activity produced billable hours that were equal to or greater than the total investment into the activity, excluding time. An unsuccessful activity generated traceable revenue but was less than the cost of the effort.

• • • •

Unsuccessful -

• Advertising (non-sponsorship based). • Service club participation; Rotary, Lions, Sierra Club, Boy Scouts of America. Additional work is required to better track revenues resulting from each of our marketing activities.
Table: Historical Data Historical Data

rke

Ma

Variable Industry Revenue Company Market Share Company Revenue Industry Variable Costs Company Variable Costs Industry Gross Contribution Margin Company Gross Contribution Margin Marketing Expenses Company Net Contribution Margin

tin

gP

Referral-based activities; Professional referrals, Individual referrals. Selective Sponsorships: Southern California Opera, Youth Sports. Yellow pages: Competitive size ads for our area. Board member participation: Lodging Association of Southern California, San Clemente City Commission on Land Use, California Opera, Youth Sports.

lan

Successful -

Pro
2003 $10,006,800 12% $1,200,816 $1,318,100 $120,082 $8,688,700 $1,080,734 $4,000 $1,076,734

2.3.5 Historical Results

Academic Version

Sa
2004 $10,905,600 13% $1,363,200 $1,448,400 $136,320 $9,457,200 $1,226,880 $4,400 $1,222,480

• Increased competition from sole practitioners and new firms. • Continued sophistication and affordability of software that replaces or minimizes the role of a CPA for tax preparation, accounting, and bookkeeping services. • General perceptions that accounting firms are only used for tax-related aspects of business rather than as a valuable resource for broader business consulting issues. • Some organizations planning for an Initial Public Offering (IPO) perceive they must use a national accounting firm. • State and/or federal tax laws that lead to gross simplification, such as legislation leading to a flat income tax, which would result in reducing billable hours for business and individual taxes.

mp
2005 $11,692,000 13% $1,519,960 $1,539,200 $151,996 $10,152,800 $1,367,964 $4,840 $1,363,124

le

2.3.4.4 Threats

Page 8

Franklin & Moore

Competitors fall into four primary categories; other firms, sole practitioners, licensed tax consultants and bookkeeping services, and software. Other CPA firms - A total of 5 firms conduct business in our area that are comparable to Franklin & Moore in size and capabilities, including one that is a national firm. These firms have staff and technology resources similar to ours, although their focus and areas of specialization vary.

Software - Increasing competition from individual software, particularly Intuit's "Turbo Tax" and H&R Block Financials' "Tax Cut."

2.4.1 Direct Competition

The following companies are direct competition to Franklin and Moore. More about them are discussed in the following tables and charts. 1. 2. 3. 4. Huber & Huber PC - Are our strongest competitors. they have a strong image and are a very stable company growing at a good pace. Lang Pauls & Rowe - Come in a close second to H&H. They too are well known in the market and offer quality services. Wright & Ellison - The biggest threat W&E pose to us is the strong strategic alliances that they have. These alliances have positioned them to grow quickly and they could become a bigger threat. Insight - This is our weakest competitor. They have not been around for very long and struggle with providing quality services backed with expertise.

rke

Table: Growth and Share Analysis Growth and Share

Ma

Competitor Huber & Huber PC Lang Pauls & Rowe Wright & Ellison Insight Franklin & Moore LLC Average Total

tin

gP
Price $150 $145 $155 $125 $160 $147.00 $735.00

lan
Growth Rate 10% 7% 6% 16% 9% 9.60% 48.00%

Academic Version

Pro

Licensed tax consultants and bookkeeping services - The "Type I" individual client, with straightforward and uncomplicated needs, often looks to licensed tax consultants and bookkeeping services in lieu of the services we offer. This client type may consider these preparers on the basis of "self preparation avoidance" rather than from seeking proactive advice and council.

Sa
Market Share 9% 14% 11% 6% 15% 11.00% 55.00%

Sole practitioners - An estimated 23 sole practitioners exist in the immediate area. This ranges from individuals that have been in business for over 20 years to those that are in their sixth month. Their resources are limited in terms of staff and technology.

mp

le

2.4 Competition

Page 9

Franklin & Moore
Table: Competitive Analysis Competitive Analysis Competitor Product and/or Service Image Quality Quality Selection Price Other Location and Physical Appearance Business Traffic Appearance Visibility Convenience Factors Other Added Value Factors Pre and Post Sales Service Experience Expertise Pre and Post Sales Service Experience Expertise Reputation Image Stability Strategic Alliances Other Other Marketing Activities Established Sales Channels Advertising Post-purchase Support Incentives Loyalty Components Other Total #1 H&H H&H H&H H&H 9 8 8 8 H&H 5 9 8 7 0 H&H H&H H&H H&H 9 8 9 8 9 8 7 0 H&H 7 2 7 6 9 0 151 #2 LP & R LP & R LP & R LP & R 8 9 9 7 LP & R 9 9 7 8 0 #3 W&E

Sa
W&E 8 8 8 7 0 W W W W &E &E &E &E 7 6 9 8 6 7 9 0 W&E 9 7 7 6 6 0 147

W&E W&E W&E 7 8 6 8

mp
Insight Insight Insight 5 6 5 6 Insight 8 7 5 6 0 Insight Insight Insight Insight 5 7 7 5 4 5 5 0 Insight 5 9 6 9 6 0 121

#4 Insight

le
#5 Sole Pract. Sole Pract. Sole Pract. Sole Pract. 4 9 3 5 Sole Pract. 5 5 5 5 0 Sole Pract. Sole Pract. Sole Pract. Sole Pract. 4 5 5 5 5 6 6 0 Sole Pract. 4 5 5 4 6 0 101

#6 Tax Services Tax Services Tax Services Tax Services 5 4 2 8 Tax Services 3 4 4 4 0 Tax Services Tax Services Tax Services Tax Services 5 4 4 2 2 2 2 0 Tax Services 3 3 6 3 3 0 73

Ma
Academic Version

rke

tin

gP

lan
LP & R 7 8 7 6 6 0 156

Pro
LP & R LP & R LP & R LP & R 8 7 9 9 6 9 8 0

Page 10

Franklin & Moore

Competitor by Growth and Share

18% 16% 14% 12% 10% 8% 6% 4% 75 80 85 90

2.4.2 Indirect Competition

Tax Software is our largest indirect competitor. As the public becomes more comfortable with home computer technology, they are increasingly relying on tax software packages like Intuit's "Turbo Tax" and H&R Block Financials' "Tax Cut." However, for the kinds of clients we pursue, these software packages lack the nuances and prompting that yield best results.

Ma

rke

Our marketing strategies are based on meeting the needs of existing and future clients. We will do this through leveraging internal and external business strengths and understanding the competitive environment. All marketing strategies work toward supporting our mission statement and realizing our stated goals. Our marketing strategies fall into these three categories: 1. 2. 3. Revenue diversification, including service and industry specialization. Fixed fee structure focus. Marketing awareness training.

tin

3.0 Marketing Strategy

gP

Academic Version

lan

Pro
95 100

Sa
105

mp
Insight

le
Huber & Huber PC Lang Pauls & Rowe Wright & Ellison Franklin & Moore LLC

Page 11

Franklin & Moore

3.2 Critical Issues

Critical issues for Franklin & Moore include:

3.3 Financial Objectives
1. 2. 3.

Ma

rke

3.4 Marketing Objectives
1. 2. 3.

4.

To realize an annual growth rate of 8.25% greater than the previous year. To diversify our revenue stream through increased business consulting (non-tax related) activities to account for 26% or more of total revenues. To create a visible profile through establishing reciprocal referral sources with the following: • (3) major banks • (1) credit union • (2) major law firms • (2) brokerage firms Train the entire staff to understand, appreciate, and reinforce their role in marketing the firm.

tin

Revenues of $1.6 million by year-end to realize a growth rate of 8.25% compared to the previous year. Non-tax preparation revenues greater than 25% of total billing. Payroll expenses to increase no more than 8% compared to the previous year.

gP

Academic Version

lan

• Retaining clients is essential and will be determined by maintaining our reputation built upon professionalism, trust, accuracy, and timeliness. • Continuing to leverage our computer-based capabilities within the firm on a costeffective basis. • Tracking results to better understand which marketing activities offer the best return. • Focusing on key market segments that will produce the greatest return. • Educating our staff so everyone takes a role in marketing the firm and not leaving this responsibility to the few "rainmakers" that now account for a large percentage of new business.

Pro

The firm appears to be approaching a "mature" category. We have relatively low major opportunities, fairly low threats, limited growth potential, and relatively low risk.

Sa

mp

Providing quality service is critical. Our business and individual clients judge our competence based on how we treat them. This is their primary - and in many cases their only measurement of our capabilities. Our Value Proposition to the client is that we will do their taxes, financial planning, business accounting, etc. better then they do it. We will work closely with our clients to make sure we know what their goals are, where they are financially and where they want to be in the future so that every service we provide is personal and customtailored for our clients.

le

3.1 Value Proposition

Page 12

Franklin & Moore

Our primary target markets include these three areas: 1. 2.

3.

3.6 Messaging

Expertise and Personal Service to Maximize our Clients' Finances

Franklin & Moore LLC needs to brand itself as the professional, expert, personal accountants. It is important that people associate Franklin & Moore LLC with expertise and personal service. Our marketing materials both offline and online will need to reflect this brand message.
Table: Target Market Messaging Target Market Messaging

Ma

rke

Market Segments Large Business Growth Business Select Individual Accounts

tin

gP

3.6.1 Branding

Messaging Improve profitability, reduce taxes Understand opportunities for financial growth Personalize the financial tax and planning process

Academic Version

lan

Franklin & Moore LLC offers a unique team of CPAs and a professional accounting and bookkeeping staff with proven expertise as business consultants. We do more than prepare taxes. We also provide a variety of valuable services that enable a business to optimize their profitability and minimize their tax exposure. We want to make sure that our marketing never loses site of our strengths as a company:

Pro

Sa

Established businesses of more than 50 employees that value an accounting firm that offers comprehensive business planning services, particularly those in the medical/health, dental, and lodging industries. Growing businesses of less than 50 employees that need our services now and will rely on them to a greater extent as their businesses and requirements grow, particularly those that will benefit from areas of specialization, such as pension and retirement program planning. Individual clients with a net worth in excess of $1.2 million that are concerned about the current earning capabilities of their assets and what will happen to those assets when they are passed to their heirs.

mp

le

3.5 Target Market Strategy

Page 13

Franklin & Moore

We have filled out three strategies in the strategy pyramids below.

Strategy Pyramid
Revenue Diversification

Industry specialization through expanding in medical/health, dental, and lodging clients.

Identify potential new clients

Additional involvement in industry associations

Service specialization and building on proven skills.

rke

Ma

Strategy Pyramid 2

tin

Expertise-based marketing

gP

Promotion of areas of specialization

Utilize our website to communicate and demonstrate these skills

Leveraging contacts in vertical markets

Articles in industry publications

Presentations at regional or national industry conferences

Academic Version

lan

Pro

Sa
Page 14

mp

Franklin & Moore's strategy is focused on leveraging our existing strengths. We will strive to emphasize those strengths that cannot be duplicated by our competitors or through the use of software. This is an important factor in differentiating the firm. All tactics to implement this strategy include leveraging the quality of our work and our in-house computer capabilities.

le

3.7 Strategy Pyramids

Franklin & Moore
Fixed Fee Structure Emphasis

Support System

Program 4-A Identification of high potential fixed fee work

Implement tracking program

Increase fixed fee billing

Training regarding fixed fee approach

Implement incentive program for offering and acquiring

Strategy Pyramid 3
Marketing Awareness Training

Train all employees on the firm's marketing strategy and their role

rke

Ma

tin

Formalization of referral program

gP

Individual training for all partners and staff CPAs

Initial overview of marketing plan

Define roles based on position

Referral log automated for tracking performance

Identify high-potential professional contacts for referral sources

Generate monthly reports for all employees

Academic Version

lan

Pro
Page 15

Sa

mp

le

Franklin & Moore

4.1 Product Marketing

4.2 Pricing

Client billing rates reflect the level of expertise required to perform the work. Our average hourly billing rates are shown in the Price List table, below.

Price List

Ma

rke

Item Partner Staff CPA Accounting Staff Bookkeeping Staff

tin

Table: Price List

gP
Description per hour per hour per hour per hour

As mentioned in our marketing strategy, we will also work to bill more of our work on a fixedfee basis, particularly the work that can better utilize our computerized capabilities. These fees will be based on the value offered the client, not the internal time required to complete the task.

lan

Franklin & Moore will seek to provide a premium product at a premium price that offers the best overall value to our clients. Ultimately, our clients will realize greater wealth as a result of their ability to optimize profitability and minimize their tax obligations.

Pro

We need to fulfill the promise we make to each client - to provide them with the resources they need to reach their business and personal financial goals, with unwavering confidence in our firm throughout that process and, ultimately, throughout their lives.

Sa

Academic Version

mp

Our experience has proven that the most significant factor in acquiring new clients is a direct result of referrals from our existing client base. In 2005, more than 80% of our new clients directly or indirectly resulted from a referral by an individual or business client. Client retention is essential. Receiving referrals from them will determine our success or failure. People ask other people they know, trust, and share a similar financial position to tell them what firm or CPA to use. It is as simple as that. Our marketing mix will consistently work to optimize the volume and quality of those referrals.

le
Per Unit Price $165 $110 $65 $45

4.0 Marketing Mix

Page 16

Franklin & Moore

We will promote the firm through these critical marketing components: 1. 2. 3. 4.

• major banks • credit unions • major law firms • brokerage firms • current clients

Our referrals hinge upon key relationships with other companies in financial and professional services. Often a client will be with their lawyer, banker, stock broker, etc. and realize that they need accounting and financial planning help. Sometimes the professional they are with might want to suggest that they see an accounting firm. By building these marketing relationships we will also build a sales pipeline for new clients.

4.3.1 Advertising

rke

We will also advertise on "Local" portals online making sure that people always find us when they are looking for an accounting and finance firm in this area. Our website needs to clearly communicate our brand and positioning so that when we drive traffic to it -- it results in leads into our office.
Table: Advertising Milestones Milestones

Ma

Advertising Print Ad Brochures Total Advertising Budget

tin

We will advertise only in local newspapers and trade magazines, as we want to attract local clients. We are not big enough to spend money on national advertising in national magazines.

gP

lan
Start Date 1/1/2006 1/1/2006

Pro
End Date 6/15/2006 1/15/2006 Budget $5,000 $5,000 $10,000 Manager John John Department Marketing Marketing

We will focus on getting referrals from:

Academic Version

Sa

Leverage referrals from professional contacts and individual clients to make this an integral part of how we conduct business. Enhance our profile within our targeted industries and areas of specialization by increasing our reputation for possessing unique expertise in these areas. Have the expectation that all employees will take on the task of marketing the firm as they approach their other areas of responsibility. We will track, give feedback, and acknowledge efforts, accomplishments, and results from these actions. Continue to use the technology we have, including our in-house computer capabilities and our website. Both possess incredible potential for future differentiation in an increasingly competitive market.

mp

le

4.3 Promotion

Page 17

Franklin & Moore

We will use our PR agency to book interviews related to topics in our industry to continue to build the image of our expertise. We must stay focused in our PR efforts, as we do not want to spend more then a few thousand dollars a month on PR expenses.
Table: PR Milestones Milestones PR Press Kit Press Releases Total PR Budget Start Date 1/1/2006 1/1/2006

4.3.3 Direct Marketing

Table: Direct Marketing Milestones Milestones

Ma

rke

tin

Direct Marketing Newsletter Tax Brochure Financial Planning Brochure Total Direct Marketing Budget

gP

lan
Start Date 1/1/2006 1/1/2006 1/1/2006

We will send out direct marketing mainly to current clients. We will send out a quarterly tax and financial planning newsletter, as well as tax planning information twice per year. We will use a direct marketing agency to make sure that our mailings look professional and use professional designs and high quality content.

Pro
End Date 5/15/2006 4/15/2006 6/15/2006

End Date 4/15/2006 12/15/2006

Sa
Budget $4,000 $3,000 $7,000 Manager Mary Mary Department Marketing Marketing Budget $10,000 $6,000 $6,000 $22,000 Manager Peter Peter Peter Department Marketing Marketing Marketing

Academic Version

mp

It will be important for us to use PR to maintain our image in the community, and to remain known as THE experts in our industry. We will issue Press Releases whenever one of our partners speaks at an event, or teaches a class. We will also issue press releases when we get big clients on board, assuming we have the client's permission.

le

4.3.2 Public Relations

Page 18

Franklin & Moore

Our website goals are as follows: 1. 2. 3.

4.4.2 Website Marketing Strategy

4.4.3 Development Requirements

Our website is already up and running. We need to have: 1. 2. 3. 4. A client-only secure area where clients can access relevant information to their account We need to be able to send regular newsletters to clients and prospective clients We need to have fresh updated content relevant to our industry We need to revamp our "About the Company" section of our website.

Ma

rke

tin

gP

We will do some very basic pay-per-click online advertising in local portals in order to attract clients who are searching for our services. Other then that our website will be used mainly to attract word of mouth referrals and will be used to continue to market and communicate with our existing clients.

Academic Version

lan

Our web site marketing strategy is very simple. We need to have an up-to date very professional website that reflects the brand and image of our company. When a lawyer, or banker or stock broker refers a client to us, we want them to be able to visit us online and get a very good sense of who we are, what we do, and why we are the best.

Pro

Convey professional, expert, yet personal brand Communicate with current clients Prospect future clients

Sa
Page 19

4.4.1 Website Goals

mp

Our website is currently live and working, but needs some revamping, both of content and features. The main focus of our Internet presence is to serve as a permanent, alwaysaccessible information and branding tool for prospective clients, with a secondary goal of providing client-only features.

le

4.4 Web Plan

Franklin & Moore
Table: Pay-per-click ROAS Pay-Per-Click ROAS Network Google Yahoo! Other Total Monthly Cost $500 $250 $0 750 Clicks 50 20 0 70 Leads Generated 2 1 0 3 Orders 1 1 0 2 Monthly Revenue $2,000 $1,000 $0 3000

le
ROAS 400% 400% 0% 267% Cost-perclick $10.00 $12.50 $0.00 $7.50 Manager Chris Chris Chris

Milestones Web Development Secure Client Log-in Updated Content Newsletter Capability Total Web Development Budget Start Date 1/1/2003 1/1/2003 1/1/2003

4.5 Service

4.6 Implementation Schedule

Ma

rke

This will be a topic of focus at the end-of-the-year partners' meeting to evaluate annual results and validate or challenge the marketing plan for the upcoming year.

tin

The milestones graphic illustrates key implementation activities. Each partner understands the programs, and they have been assigned to oversee specific actions involved with each. We will track plan-vs.-actual results for each program. Status and progress will be addressed at the monthly partners meeting and reported to all of our staff in our monthly bulletin.

gP

• • • • •

Do they act in a professional manner? Do they know who I am? Do they remember my name? Are they genuinely concerned about my best interest? Will they defend their advice and council if needed?

Academic Version

lan

Our business and individual clients judge our competence based on how we treat them. This is their primary - and in many cases their only - measurement of our capabilities. We must ensure that each of our clients will answer positively to these questions:

Pro

End Date 3/15/2003 12/15/2003 1/15/2003

Sa
Budget $10,000 $10,000 $4,000 $24,000

Table: Website Milestones

mp

Cost-perlead $250.00 $250.00 $0.00 $166.67

Department Web Web Web

Page 20

Franklin & Moore
Table: Milestones Milestones Advertising Print Ad Brochures Total Advertising Budget PR Press Kit Press Releases Total PR Budget Direct Marketing Newsletter Tax Brochure Financial Planning Brochure Total Direct Marketing Budget Web Development Secure Client Log-in Updated Content Newsletter Capability Total Web Development Budget Other Name me Name me Name me Other Total Other Budget Totals Start Date 1/1/2006 1/1/2006 Start Date 1/1/2006 1/1/2006 Start Date 1/1/2006 1/1/2006 1/1/2006 Start Date 1/1/2003 1/1/2003 1/1/2003 Start Date 1/1/2003 1/1/2003 1/1/2003 1/1/2003 End Date 6/15/2006 1/15/2006 End Date 4/15/2006 12/15/2006 End Date 5/15/2006 4/15/2006 6/15/2006 End Date 3/15/2003 12/15/2003 1/15/2003 End Date 1/15/2003 1/15/2003 1/15/2003 1/15/2003 Budget $5,000 $5,000 $10,000 Budget $4,000 $3,000 $7,000 Budget $10,000 $6,000 $6,000 $22,000 Budget $10,000 $10,000 $4,000 $24,000 Budget $0 $0 $0 $0 $0 $63,000

mp
Manager Mary Mary Manager Peter Peter Peter Manager Chris Chris Chris Manager ABC ABC ABC ABC

Sa

Pro

4.7 Sales Plan

4.7.1 Sales Strategy

Ma

rke

4.7.2 Sales Process

Once we get a new client referral we will make sure we set up a welcome meeting for them at no charge. This way the new client will have an opportunity to spend at least one hour with the relevant professional asking questions and understanding the services that we offer. All prospective clients will also receive a packet with relevant information: 1. 2. 3. 4. 5. How much we charge per hour What services we offer How we implement those services Which account manager will see them though all services and will be their "go to" person Happy client testimonials

tin

We should focus our strategy on increasing billing hours with current clients while still giving them a lot of value for the money they spend, as well as converting new clients.

gP

Our sales plan hinges on making a good impression from the moment clients or potential clients walk in the door or call. It costs us much more to gain a new client than to retain an existing one, so our main sales goal is to increase billable hours from existing clients.

Academic Version

lan

le
Manager John John

Department Marketing Marketing Department Marketing Marketing Department Marketing Marketing Marketing Department Web Web Web Department Department Department Department Department

Page 21

Franklin & Moore
Table: Sales Account Plan Sales Account Plan Target Accounts Bid Company A Bid Company B Bid Company C Existing Key Accounts Client 1 Client 2 Client 3 Total History none none none History 6 years 2 years 1 year Status internal services competitor none Status strong, loyal satisfied exremely satisfied Annual Sales Potential $80,000 $55,000 $75,000

Key Account Manager

Sa
$20,000 $310,000

Annual Sales Potential Key Account Manager $45,000 0% $35,000 0% 0%

5.0 Financials

Our marketing plan requires annual revenues of $1,600,000 for this year. We anticipate that we will have revenues of more than $2,500,000 within 5 years. Our marketing expenses will equate to an average of 2.5% of total sales throughout. The marketing plan is based on these three parameters:

2. 3.

Ma

rke

tin

gP

Academic Version

lan

1.

Increasing our efficiencies through better use of our facilities and expertise. Variable costs will be reduced, as we are able to make use of the capital investment we have in our systems. We will invest in these systems with the expectation that we will benefit as we have in the past from their capabilities. It provides us a competitive edge many of our competitors cannot afford. We will continue to invest in marketing activities based on a percent of total revenues. As our revenues increase, so will our marketing resources. We will forecast and track revenues on a detail basis to provide objective feedback regarding progress in the areas of industry expertise, specialization, and client revenue sources by type.

Pro

mp

le
0% 0% 0%

Page 22

Franklin & Moore

Break-even Analysis Monthly Revenue Break-even Assumptions: Average Percent Variable Cost Estimated Monthly Fixed Cost $42,283 31% $42,250

Break-even Analysis
$60,000 $40,000 $20,000 $0 ($20,000) ($40,000) ($60,000)

gP
$0 $16,000

lan
$32,000 $47,000 $63,000 $79,000

Monthly break-even point

tin

Break-even point = where line intersects with 0

Ma

rke

Academic Version

Pro
Page 23

Sa

Table: Break-even Analysis

mp

Our variable costs are less than 38% of revenues. This is a result of our fixed costs including our facility, computer and technology expenses, and our salaried staff. Variable costs include temporary/seasonal hires, compensation for CPAs based on performance, and client demands that require travel and other per-job based expenditures. Variable costs are expected to continue to decrease as a percent of revenues as we strive to further benefit from technology and become less dependent on wages and salaries.

le

5.1 Break-even Analysis

Franklin & Moore

Revenues for this year are based on a 5% growth rate. This is conservative and will be more challenging as we work to diversify our revenue base.
Table: Sales Forecast Sales Forecast 2006 Sales Business Clients - Tax Preparation Business Clients - Tax Planning Business Clients - General Consulting Business Clients - Other Individual Clients - Tax Preparation Individual Clients - Tax Planning Individual Clients - Personal Finance Consulting Individual Clients - Other Total Sales Direct Cost of Sales Business Clients - Tax Preparation Business Clients - Tax Planning Business Clients - General Consulting Business Clients - Other Individual Clients - Tax Preparation Individual Clients - Tax Planning Individual Clients - Personal Finance Consulting Individual Clients - Other Subtotal Direct Cost of Sales $448,000 $272,000 $144,000 $112,000 $352,000 $128,000 $96,000 $48,000 $1,600,000 2007 $447,200 $258,000 $206,400 $154,800 $309,600 $137,600 $154,800 $51,600 $1,720,000

2008 $480,000 $260,000 $300,000 $200,000 $300,000 $140,000 $240,000

Sa
$80,000 $2,000,000 2008 $148,550 $92,800 $49,500 $38,500 $97,500 $37,200 $27,500 $14,500 $506,050

Pro
2007 $147,567 $91,200 $48,500 $37,500 $96,500 $36,000 $26,500 $13,500 $497,267

2006 $147,839 $89,760 $47,522 $36,960 $95,039 $34,561 $25,921

lan
$12,960 $490,562

$300,000 $250,000 $200,000 $150,000 $100,000

tin

gP

Sales Monthly

Business Clients - Tax Preparation Business Clients - Tax Planning Business Clients - General Consulting Business Clients - Other Individual Clients - Tax Preparation Individual Clients - Tax Planning Individual Clients - Personal Finance Consulting Individual Clients - Other

Ma

rke

$50,000

$0

Academic Version

mp
2009 $614,400 $304,200 $324,000 $216,000 $360,000 $152,600 $256,800 $82,400 $2,310,400 2009 $149,800 $93,400 $50,500 $39,500 $98,500 $38,300 $28,500 $15,500 $514,000

le
2010 $787,000 $356,000 $350,000 $233,000 $432,000 $166,000 $275,000 $85,000 $2,684,000 2010 $150,500 $94,500 $52,000 $40,000 $99,500 $39,200 $29,000 $16,000 $520,700

5.2 Sales Forecast

Page 24

Franklin & Moore

Table: Sales Breakdown by Partner Sales by: Partner 2006 Sales Franklin Moore Benning Sonnett Cummings Williams Other Total Average $193,300 $169,600 $167,000 $152,800 $154,100 $145,800 $617,400 $1,600,000 $228,571 2007 $223,000 $200,000 $195,000 $184,500 $185,000 $178,000 $554,500 $1,720,000 $245,714

Sa
$230,000 $207,000 $202,000 $189,000 $190,000 $186,000 $796,000 $2,000,000 $285,714

2008

mp
2009 $234,000 $150,000 $210,000 $195,000 $196,000 $192,000 $1,133,400 $2,310,400 $330,057

As the projection shows, we track revenue by partner, but a significant amount of the total revenue comes from the billing of the staff itself. Craig Moore will be retiring in the year 2010. The detail for this table is included in the appendices.

Sales Breakdown by Partner Monthly
$300,000 $250,000 $200,000 $150,000 $100,000 $50,000 $0

lan gP
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Pro

Ma

rke

tin

Academic Version

le
Franklin Moore Benning Sonnett Williams Other

5.2.1 Sales by Partner

2010

$236,000 Retiring $230,000 $200,000 $200,000 $200,000 $1,618,000 $2,684,000 $447,333

Cummings

Page 25

Franklin & Moore

Table: Sales Breakdown by Segment Sales by: Segment 2006 Sales Large Business Growth Business Individuals Total Average $672,850 $538,500 $388,650 $1,600,000 $533,333 2007 $702,000 $516,000 $502,000 $1,720,000 $573,333

Sa
2008 $815,000 $600,000 $585,000 $2,000,000 $666,667

mp
2009 $889,000 $694,000 $727,400 $2,310,400 $770,133

Our most important markets are our "large" and "growth" business clients. We have made strides to focus on revenues from these more profitable and faster-growing segments. This lowers the dependency on our "individual" client base, and our goal is to continue this focus for the future.

Sales Breakdown by Segment Monthly
$300,000 $250,000 $200,000 $150,000 $100,000 $50,000 $0

lan
Jan Feb Mar Apr May Jun

Pro

gP

Ma

rke

tin

Jul Aug Sep Oct Nov Dec

Academic Version

le
Individuals

5.2.2 Sales by Segment

2010 $1,000,000 $900,000 $784,000 $2,684,000 $894,667

Large Business Growth Business

Page 26

Franklin & Moore

Sales by: Specialization 2006 Sales Medical/Health Dental Lodging Manufacturing Individual Revenues Other Total Average $27,200 $24,000 $192,000 $64,000 $304,000 $988,800 $1,600,000 $266,667 2007 $309,600 $275,200 $223,600 $68,800 $550,400 $292,400 $1,720,000 $286,667

Sa
2008 $380,000 $340,000 $280,000 $60,000 $620,000 $320,000 $2,000,000 $333,333

Table: Sales Breakdown by Specialization

mp
2009 $472,500 $405,000 $337,500 $67,500 $652,500 $375,400 $2,310,400 $385,067

Our three targeted areas of specialization in medical/health, dental, and lodging represent a relatively small portion of total income, but these are some of the most profitable accounts for the firm. These areas also offer the possibility of ongoing monthly billing opportunities to spread billing throughout the year, versus the heavy concentration of activity around the tax schedule. Manufacturing still represents a significant number of annual billable hours, but the low to no-growth rate no longer makes this an attractive segment.

Sales Breakdown by Specialization Monthly
$300,000 $250,000 $200,000 $150,000 $100,000 $50,000

lan gP
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Pro

$0

Ma

rke

tin

Academic Version

le
Medical/Health Dental Lodging Manufacturing Other

5.2.3 Sales by Specialization

2010 $550,000 $500,000 $400,000 $75,000 $67,500 $1,091,500 $2,684,000 $447,333

Individual Revenues

Page 27

Franklin & Moore

Each partner has an individual budget for his or her marketing activities. The combined totals for those by marketing line item are listed in the following table.

Total Sales and Marketing Expenses Percent of Sales

$7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $0

lan

Monthly Expense Budget

Pro

Marketing Expense Budget Advertising Dues Meals & Entertainment Printed Materials Public Relations Sponsorships Travel Web Support Other

2006 $4,848 $1,940 $2,020 $9,700 $5,600 $6,868 $4,444 $4,848 $600 -----------$40,868 2.55%

2007 $5,000 $2,250 $2,400 $10,800 $5,850 $7,200 $4,600 $5,500 $600 -----------$44,200 2.57%

Sa
2008 $5,200 $2,450 $2,600 $12,900 $6,350 $7,650 $4,900 $6,000 $800 -----------$48,850 2.44%

Table: Marketing Expense Budget

mp
Advertising Dues Travel Web Support Other

Marketing expenses will correlate with firm revenues. This is based on a 2.5% factor of annual revenues. These expenses include any client development activities that promote the firm or any individual within the firm.

le
2009 $5,400 $2,650 $2,800 $14,500 $6,550 $7,800 $5,200 $6,800 $1,000 -----------$52,700 2.28%

5.3 Expense Forecast

2010 $5,600 $2,800 $3,000 $16,000 $7,200 $8,400 $5,600 $7,500 $1,200 -----------$57,300 2.13%

gP tin
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Meals & Entertainment Printed Materials Public Relations Sponsorships

Ma
Academic Version

rke

Page 28

Franklin & Moore

Expenses by Partner 2006 Expenses Franklin Moore Benning Sonnett Cummings Williams Moore Other Total Average $5,000 $5,000 $4,850 $4,800 $4,650 $4,250 $4,100 $8,218 $40,868 $5,109 2007 $6,000 $6,000 $5,500 $5,500 $5,000 $5,000 $5,000 $6,200 $44,200 $5,525

Sa
2008 $6,500 $6,500 $6,000 $6,000 $6,000 $5,500 $5,500 $6,850 $48,850 $6,106

Table: Expense Breakdown by Partner

mp
2009 $6,750 $6,750 $6,250 $6,250 $6,250 $6,000 $6,000 $8,450 $52,700 $6,588

As the table and chart shows, with additional information in the appendices, a majority of our expenses are managed by the seven partners, not by marketing. Each partner has an expense allocation that is overseen by marketing to deal with specific client development programs, marketing of expertise, and related projects. Marketing holds each partner accountable, although not always an easy task, to leverage these client development resources for the best return possible.

$7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $0

lan

Expense Breakdown by Partner Monthly

Pro
Jul Aug Sep Oct Nov Dec

gP

tin

Ma

rke

Jan Feb Mar Apr May Jun

Academic Version

le
Franklin Moore Benning Sonnett Williams Moore Other

5.3.1 Expense by Partner

2010 $7,000 $0 $6,600 $6,600 $6,600 $6,500 $6,500 $17,500 $57,300 $7,163

Cummings

Page 29

Franklin & Moore

Table: Expense Breakdown by Segment Expenses by Segment 2006 Expenses Business Individual Other Total Average $26,900 $11,000 $2,968 $40,868 $13,623 2007 $30,000 $12,000 $2,200 $44,200 $14,733

Sa
$34,000 $13,500 $1,350 $48,850 $16,283

2008

mp
2009 $36,000 $15,400 $1,300 $52,700 $17,567

Consistent with our growth strategy, a majority of our expenses are dedicated towards marketing to businesses rather than individuals. Our marketing expenses are targeted to communicate our expertise and how those skills will benefit business clients.

Expense Breakdown by Segment Monthly
$7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $0

lan gP
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Pro

Ma

rke

tin

Academic Version

le
Other

5.3.2 Expense by Segment

2010 $39,000 $17,000 $1,300 $57,300 $19,100

Business Individual

Page 30

Franklin & Moore

The following table and chart show our expenses broken down by specialization.
Table: Expense Breakdown by Specialization Expenses by Specialization 2006 Expenses Medical/Health Dental Lodging Other Total Average $9,800 $9,800 $8,200 $13,068 $40,868 $10,217 2007 $0 $0 $0 $44,200 $44,200 $11,050

2008 $12,000 $12,000 $10,000 $14,850 $48,850 $12,213

mp
2009 $15,000 $13,500 $12,000 $12,200 $52,700 $13,175

Expense Breakdown by Specialization Monthly
$7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $0 ($1,000)

lan
Jan Feb Mar Apr May Jun

Pro

Sa

gP

Jul Aug Sep Oct Nov Dec

Ma

rke

tin

Academic Version

le
2010 $17,000 $15,000 $14,000 $11,300 $57,300 $14,325

5.3.3 Expense by Specialization

Medical/Health Dental Lodging Other

Page 31

Franklin & Moore

Sales vs. Expenses Monthly
$300,000 $250,000 $200,000 $150,000 $100,000 $50,000 $0

Pro gP
Jan Feb Mar Apr May Jun

Sa
Sales Expenses

5.5 Contribution Margin

Contribution margins should increase as a result of these factors: 1. 2. 3. 4. Increased efficiencies and revenue through specialization. Increased efficiencies through use of our available technology. Economies of scale from growth and better utilization of capacity. More evenly spreading work out throughout the calendar year.

Ma

rke

tin

Academic Version

lan

Jul Aug Sep Oct Nov Dec

mp

Our marketing expenses represent a small portion of total revenue generated, as illustrated on the following graph. Regardless, marketing-based efforts and our marketing expenditures must produce results. Our Marketing Director tracks this correlation and reports to the partners regarding our progress at our scheduled meetings. We expect to see our strategies impact the bottom line in the preferred areas. Our relatively conservative approach appears to be a good fit. An unexpected decrease in revenues will impact our marketing budget, and we will address this issue if required.

le

5.4 Linking Expenses to Strategy and Tactics

Page 32

Franklin & Moore
Table: Contribution Margin Contribution Margin Sales Direct Cost of Sales Other Variable Costs of Sales Total Cost of Sales Gross Margin Gross Margin % Marketing Expense Budget Advertising Dues Meals & Entertainment Printed Materials Public Relations Sponsorships Travel Web Support Other Total Sales and Marketing Expenses Percent of Sales Contribution Margin Contribution Margin / Sales 2006 $1,600,000 $490,562 $4,855 -----------$495,417 $1,104,583 69.04% 2006 $4,848 $1,940 $2,020 $9,700 $5,600 $6,868 $4,444 $4,848 $600 -----------$40,868 2.55% $1,063,715 66.48% 2007 $1,720,000 $497,267 $0 -----------$497,267 $1,222,733 71.09% 2007 $5,000 $2,250 $2,400 $10,800 $5,850 $7,200 $4,600 $5,500 $600 -----------$44,200 2.57% 2008 $2,000,000 $506,050 $5,200 -----------$511,250 $1,488,750 74.44% 2009 $2,310,400 $514,000 $5,600 -----------$519,600 $1,790,800 77.51%

Sa
2008 $5,200 $2,450 $2,600 $12,900 $6,350 $7,650 $4,900 $6,000 $800 -----------$48,850 2.44% $1,439,900 72.00%

mp
2009 $5,400 $2,650 $2,800 $14,500 $6,550 $7,800 $5,200 $6,800 $1,000 -----------$52,700 2.28% $1,738,100 75.23%

Pro
$1,178,533 68.52%

$200,000 $180,000 $160,000 $140,000 $120,000 $100,000

rke

tin

$80,000 $60,000 $40,000 $20,000

gP

$0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Ma

Academic Version

lan

Contribution Margin Monthly

le

2010 $2,684,000 $520,700 $5,850 -----------$526,550 $2,157,450 80.38% 2010 $5,600 $2,800 $3,000 $16,000 $7,200 $8,400 $5,600 $7,500 $1,200 -----------$57,300 2.13% $2,100,150 78.25%

Page 33

Franklin & Moore

The focus of this marketing plan is to initiate action that will generate additional revenues for Franklin & Moore and better position us for the future. These marketing challenges exist: • We offer intangible "products." • Our clients evaluate our capabilities based on things they see and hear. • Marketing is not well understood or received within our profession.

6.1 Implementation

We will maintain our focus with brief milestones meetings every month, making sure each partner understands his or her responsibility for maintaining our image, improve customer relations management, and increasing billable hours.
Table: ROI Calculator Return On Investment (ROI) Campaign Details Total Impressions Total Program Cost Response Rate Conversion Rate Average Customer Purchase Response Total Responders Total Buyers Revenue Generated

lan
Newspaper 12,000 60 200.00%

Pro
Local Trade Online 20,000 200 140.00% 150.00%

gP

600,000 1,000,000 500,000 $30,000.00 $250,000.00 $40,000.00 2.00% 2.00% 2.00% 0.50% 1.00% 0.50% $1,500.00 $3,000.00 $2,000.00 10,000 50 $100,000.0 $90,000.00 $600,000.00 0 $2.50 $12.50 $4.00 $500.00 $1,250.00 $800.00 $60,000.00 $350,000.00 $60,000.00

tin

Costs Cost per Response Cost per Sale Total Campaign Profit Marketing ROI

Ma

rke

Academic Version

Sa

Putting our marketing plan into action through the use of professional and credible techniques is what it is all about.

mp
Channel 4 0 $0.00 0.00% 0.00% $0.00 0 0 $0.00 $0.00 $0.00 $0.00 0.00%

le

6.0 Controls

Page 34

Franklin & Moore
Table: Customer Lifetime Value Customer Lifetime Value Customer Purchase Forecast: Average Customer Lifetime (years): 6 Average number of purchases per year: 3 Average purchase value: $1,500.00 Average Gross Margin %: 40% Gross Margin per purchase $600.00 Total Customer Purchases: Customer Acquisition Costs: Cost of marketing to a potential customer: Average conversion rate: 6% Subtotal Cost of attracting customer: Other one-off costs for first-time customers: Total Customer Acquisition Costs: Unadjusted Customer Lifetime Value: $10,800.00 $50.00 $833.33 $0.00 $833.33

Adjusted Customer Lifetime Value: Discount Rate: 0% Net Present Value of Customer Lifetime Value:

6.2 Keys to Success

Ma

rke

We will continue to subscribe to Southern California Research Institute to better understand demographic and psychographic data for our region. Additional research will involve tracking competitive activities, gathering data on key business clients and their industries, and watching the evolution of software and its impact on our industry.

tin

6.3 Market Research

gP

• Continue to leverage the in-house computer system to keep efficiencies high and costs, specifically payroll, to a minimum. • Further develop areas of specialization to attract and retain key clients. • Continue to develop client referrals from individuals and business contacts. • Marketing training to develop networking and other marketing skills within the professional staff.

Academic Version

lan

Pro
$9,966.67 $9,966.67

Sa
Page 35

mp

le

Franklin & Moore

These are the most likely changes in the marketing plan:

Online tax services - Competition from any geographic location may emerge from online services conducted by larger and better funded firms.

6.5 CRM Plans

Ma

rke

tin

gP

We have a CRM software in place to track all of our customers which also integrates with our billing and accounting system. Our current system, allows us to store contact information, account history, and additional notes added to our customer by employees at our company. We can also tag a customer with a "category" to help us better serve that customer with appropriate information. This system allows us to easily send out direct mail brochures with financial planning information to our personal finance customers vs. sending out direct mailers with business content to our business clients.

Academic Version

lan

Pro

Tax law changes - Simplification of tax laws is unlikely, but will demand that we would take a "big picture" assessment of the firm's position, due to the significant overhead commitments that we have made.

Sa

Loss of key resources - Losing key individuals in the firm could result in lost accounts or lost areas of expertise. We need to review our "Stage 2" strategy if any person in the firm should not be able to perform their function.

mp

Industry or economic downturns - At this time, the targeted industries are experiencing solid growth in our area. If industry growth does not occur, we will re-examine our select industries and/or activities and change our focus and direction.

le

6.4 Contingency Planning

Page 36

Appendix
Appendix Table: Sales Forecast Sales Forecast Jan Sales Business Clients - Tax Preparation Business Clients - Tax Planning Business Clients - General Consulting Business Clients - Other Individual Clients - Tax Preparation Individual Clients - Tax Planning Individual Clients - Personal Finance Consulting Individual Clients - Other Total Sales Direct Cost of Sales Business Clients - Tax Preparation Business Clients - Tax Planning Business Clients - General Consulting Business Clients - Other Individual Clients - Tax Preparation Individual Clients - Tax Planning Individual Clients - Personal Finance Consulting Individual Clients - Other Subtotal Direct Cost of Sales 0% 0% 0% 0% 0% 0% 0% 0% $45,640 $27,710 $14,670 $11,410 $35,860 $13,040 $9,780 $4,890 $163,000 Jan $15,061 $9,144 $4,841 $3,765 $9,682 $3,521 $2,641 $1,320 $49,975 Feb $29,400 $17,850 $9,450 $7,350 $23,100 $8,400 $6,300 $3,150 $105,000 Feb $9,702 $5,891 $3,119 $2,426 $6,237 $2,268 $1,701 $851 $32,195 Mar $54,600 $33,150 $17,550 $13,650 $42,900 $15,600 $11,700 $5,850 $195,000 Mar $18,018 $10,940 $5,792 $4,505 $11,583 $4,212 $3,159 $1,580 $59,789 Apr $73,640 $44,710 $23,670 $18,410 $57,860 $21,040 $15,780 $7,890 $263,000 Apr $24,301 $14,754 $7,811 $6,075 $15,622 $5,681 $4,261 $2,130 $80,635 May $59,360 $36,040 $19,080 $14,840 $46,640 $16,960 $12,720 $6,360 $212,000 May $19,589 $11,893 $6,296 $4,897 $12,593 $4,579 $3,434 $1,717 $64,998 Jun $34,440 $20,910 $11,070 $8,610 $27,060 $9,840 $7,380 $3,690 $123,000 Jul $21,000 $12,750 $6,750 $5,250 $16,500 $6,000 $4,500 $2,250 $75,000 Aug $22,680 $13,770 $7,290 $5,670 $17,820 $6,480 $4,860 $2,430 $81,000 Aug $7,484 $4,544 $2,406 $1,871 $4,811 $1,750 $1,312 $656 $24,834 Sep

M

k r a

in t e

P g

n la

Jun $11,365 $6,900 $3,653 $2,841 $7,306 $2,657 $1,993 $996 $37,711

r P

Jul $6,930 $4,208 $2,228 $1,733 $4,455 $1,620 $1,215

S o

m a
$26,600 $16,150 $8,550 $6,650 $20,900 $7,600 $5,700 $2,850 $95,000 Sep $8,778 $5,330 $2,822 $2,195 $5,643 $2,052 $1,539 $770 $29,129

$23,500 $14,280 $7,560 $5,880 $18,480 $6,720 $5,040 $2,520 $83,980 Oct $7,762 $4,712 $2,495 $1,940 $4,990 $1,814 $1,361 $680 $25,754

le p
Oct Nov $23,240 $14,110 $7,470 $5,810 $18,260 $6,640 $4,980 $2,490 $83,000 Nov $7,669 $4,656 $2,465 $1,917 $4,930 $1,793 $1,345 $672 $25,447

Dec $33,900 $20,570 $10,890 $8,470 $26,620 $9,680 $7,260 $3,630 $121,020 Dec $11,180 $6,788 $3,594 $2,795 $7,187 $2,614 $1,960 $980 $37,098

$608 $22,997

Academic Version

Page 37

Appendix
Appendix Table: Sales Breakdown by Partner Sales by: Partner Jan Sales Franklin Moore Benning Sonnett Cummings Williams Other Total Average $16,200 $17,000 $16,000 $15,800 $14,800 $14,500 $68,700 $163,000 $23,286 Feb $14,500 $12,800 $10,200 $9,200 $9,100 $9,000 $40,200 $105,000 $15,000 Mar $40,500 $19,600 $36,000 $34,500 $34,000 $30,400 $0 $195,000 $27,857 Apr $49,500 $48,500 $44,500 $40,000 $42,000 $38,500 $0 $263,000 $37,571 May $11,500 $19,200 $16,000 $13,200 $12,850 $13,000 $126,250 $212,000 $30,286 Jun $9,500 $9,200 $8,000 $7,800 $7,700 $7,600 $73,200 $123,000 $17,571 Jul $6,500 $6,600 $4,100 $3,800 $4,200 $4,000 $45,800 $75,000 $10,714 Aug $6,600 $6,800 $4,200 $2,600 $4,200 $4,100 $52,500 $81,000 $11,571 Sep

M

k r a

in t e

P g

n la

r P

S o

m a
$9,800 $1,000 $7,200 $6,800 $6,400 $6,200 $57,600 $95,000 $13,571

$8,800 $8,800 $4,800 $4,200 $4,150 $4,100 $49,130 $83,980 $11,997

le p
Oct Nov $5,500 $5,600 $4,500 $3,800 $3,700 $3,600 $56,300 $83,000 $11,857

Dec $14,400 $14,500 $11,500 $11,100 $11,000 $10,800 $47,720 $121,020 $17,289

Academic Version

Page 38

Appendix
Appendix Table: Sales Breakdown by Segment Sales by: Segment Jan Sales Large Business Growth Business Individuals Total Average $67,200 $57,000 $38,800 $163,000 $54,333 Feb $46,750 $36,750 $21,500 $105,000 $35,000 Mar $78,250 $68,250 $48,500 $195,000 $65,000 Apr $102,400 $92,100 $68,500 $263,000 $87,667 May $84,200 $74,200 $53,600 $212,000 $70,667 Jun $53,100 $42,500 $27,400 $123,000 $41,000 Jul $36,250 $26,250 $12,500 $75,000 $25,000 Aug $38,400 $26,250 $16,350 $81,000 $27,000 Sep

M

k r a

in t e

P g

n la

r P

S o

m a
$44,000 $28,000 $23,000 $95,000 $31,667

$39,400 $26,000 $18,580 $83,980 $27,993

le p
Oct Nov $40,500 $24,900 $17,600 $83,000 $27,667

Dec $42,400 $36,300 $42,320 $121,020 $40,340

Academic Version

Page 39

Appendix
Appendix Table: Sales Breakdown by Specialization Sales by: Specialization Jan Sales Medical/Health Dental Lodging Manufacturing Individual Revenues Other Total Average $2,992 $2,640 $21,120 $7,040 $33,440 $95,768 $163,000 $27,167 Feb $1,904 $1,680 $13,440 $4,480 $21,280 $62,216 $105,000 $17,500 Mar $3,536 $3,120 $24,960 $8,320 $39,520 $115,544 $195,000 $32,500 Apr $4,624 $4,080 $32,640 $10,880 $51,680 $159,096 $263,000 $43,833 May $3,536 $3,120 $24,960 $8,320 $39,520 $132,544 $212,000 $35,333 Jun $2,176 $1,920 $15,360 $5,120 $24,320 $74,104 $123,000 $20,500 Jul $1,088 $960 $7,680 $2,560 $12,160 $50,552 $75,000 $12,500 Aug $1,224 $1,080 $8,640 $2,880 $13,680 $53,496 $81,000 $13,500

M

k r a

in t e

P g

n la

r P

S o

m a
Sep $1,360 $1,200 $9,600 $3,200 $15,200 $64,440 $95,000 $15,833

$1,224 $1,080 $8,640 $2,880 $13,680 $56,476 $83,980 $13,997

le p
Oct Nov $1,360 $1,200 $9,600 $3,200 $15,200 $52,440 $83,000 $13,833

Dec $2,176 $1,920 $15,360 $5,120 $24,320 $72,124 $121,020 $20,170

Academic Version

Page 40

Appendix
Appendix Table: Marketing Expense Budget Marketing Expense Budget Advertising Dues Meals & Entertainment Printed Materials Public Relations Sponsorships Travel Web Support Other Total Sales and Marketing Expenses Percent of Sales Jan $624 $1,200 $260 $1,248 $728 $884 $572 $624 $50 -----------$6,190 3.80% Feb $540 $0 $225 $1,080 $630 $765 $495 $540 $50 -----------$4,325 4.12% Mar $504 $0 $210 $1,008 $588 $714 $462 $504 $50 -----------$4,040 2.07% Apr $180 $60 $75 $360 $210 $255 $165 $180 $50 -----------$1,535 0.58% May $204 $0 $85 $408 $236 $289 $187 $204 $50 -----------$1,663 0.78% Jun $180 $120 $75 $360 $210 $255 $165 $180 $50 -----------$1,595 1.30% Jul $180 $0 $75 $360 $210 $255 $165 $180 $50 -----------$1,475 1.97% Aug $384 $0 $160 $768 $450 $544 $352 $384 $50 -----------3.82% Sep $432 $360 $180 $870 $450 $612 $396 $432 $50 -----------3.98%

M

k r a

in t e

P g

n la

r P

S o
$3,092

m a
$3,782

Oct $456 $0 $190 $910 $530 $646 $418 $456 $50 -----------4.35%

le p
Nov $540 $0 $225 $1,080 $630 $765 $495 $540 $50 -----------5.21% $4,325

Dec $624 $200 $260 $1,248 $728 $884 $572 $624 $50 -----------$5,190 4.29%

$3,656

Academic Version

Page 41

Appendix
Appendix Table: Expense Breakdown by Partner Expenses by Partner Jan Expenses Franklin Moore Benning Sonnett Cummings Williams Moore Other Total Average $750 $750 $650 $650 $600 $600 $600 $1,590 $6,190 $774 Feb $600 $600 $550 $550 $500 $500 $500 $525 $4,325 $541 Mar $600 $600 $600 $600 $550 $550 $500 $40 $4,040 $505 Apr $150 $150 $300 $300 $300 $200 $100 $35 $1,535 $192 May $150 $150 $300 $300 $300 $200 $200 $63 $1,663 $208 Jun $250 $250 $250 $200 $300 $150 $150 $45 $1,595 $199 Jul $250 $250 $150 $150 $250 $200 $200 $25 $1,475 $184 Aug $300 $300 $300 $300 $300 $300 $300 $992 $3,092 $387 Sep

M

k r a

in t e

P g

n la

r P

S o

m a
$300 $300 $300 $300 $300 $300 $300 $1,682 $3,782 $473

$300 $300 $300 $300 $300 $300 $300 $1,556 $3,656 $457

le p
Oct Nov $600 $600 $500 $500 $400 $400 $400 $925 $4,325 $541

Dec $750 $750 $650 $650 $550 $550 $550 $740 $5,190 $649

Academic Version

Page 42

Appendix
Appendix Table: Expense Breakdown by Segment Expenses by Segment Jan Expenses Business Individual Other Total Average $4,300 $1,300 $590 $6,190 $2,063 Feb $2,900 $1,200 $225 $4,325 $1,442 Mar $2,800 $1,000 $240 $4,040 $1,347 Apr $1,000 $500 $35 $1,535 $512 May $1,000 $500 $163 $1,663 $554 Jun $1,000 $500 $95 $1,595 $532 Jul $1,000 $300 $175 $1,475 $492 Aug $2,000 $800 $292 $3,092 $1,031 Sep

M

k r a

in t e

P g

n la

r P

S o

m a
$2,400 $1,000 $382 $3,782 $1,261

$2,400 $1,000 $256 $3,656 $1,219

le p
Oct Nov $2,800 $1,200 $325 $4,325 $1,442

Dec $3,300 $1,700 $190 $5,190 $1,730

Academic Version

Page 43

Appendix
Appendix Table: Expense Breakdown by Specialization Expenses by Specialization Jan Expenses Medical/Health Dental Lodging Other Total Average $1,200 $1,200 $1,000 $2,790 $6,190 $1,548 Feb $1,200 $1,200 $1,000 $925 $4,325 $1,081 Mar $1,200 $1,200 $1,000 $640 $4,040 $1,010 Apr $500 $500 $500 $35 $1,535 $384 May $500 $500 $500 $163 $1,663 $416 Jun $500 $500 $500 $95 $1,595 $399 Jul $500 $500 $500 ($25) $1,475 $369 Aug $800 $800 $600 $892 $3,092 $773

M

k r a

in t e

P g

n la

r P

S o

m a
Sep $800 $800 $600 $1,582 $3,782 $946

$800 $800 $600 $1,456 $3,656 $914

le p
Oct Nov $800 $800 $600 $2,125 $4,325 $1,081

Dec $1,000 $1,000 $800 $2,390 $5,190 $1,298

Academic Version

Page 44

Appendix
Appendix Table: Contribution Margin Contribution Margin Sales Direct Cost of Sales Other Variable Costs of Sales Total Cost of Sales Gross Margin Gross Margin % Marketing Expense Budget Advertising Dues Meals & Entertainment Printed Materials Public Relations Sponsorships Travel Web Support Other Total Sales and Marketing Expenses Percent of Sales Contribution Margin Contribution Margin / Sales Jan $163,000 $49,975 $550 -----------$50,525 $112,475 69.00% Jan $624 $1,200 $260 $1,248 $728 $884 $572 $624 $50 -----------$6,190 3.80% $106,285 65.21% Feb $105,000 $32,195 $560 -----------$32,755 $72,245 68.80% Feb $540 $0 $225 $1,080 $630 $765 $495 $540 $50 -----------$4,325 4.12% $67,920 64.69% Mar $195,000 $59,789 $580 -----------$60,369 $134,631 69.04% Mar $504 $0 $210 $1,008 $588 $714 $462 $504 $50 -----------$4,040 2.07% $130,591 66.97% Apr $263,000 $80,635 $320 -----------$80,955 $182,045 69.22% Apr $180 $60 $75 $360 $210 $255 $165 $180 $50 -----------$1,535 0.58% $180,510 68.63% May $212,000 $64,998 $220 -----------$65,218 $146,782 69.24% May $204 $0 $85 $408 $236 $289 $187 $204 $50 -----------$1,663 0.78% Jun $123,000 $37,711 $225 -----------$37,936 $85,064 69.16% Jun $180 $120 $75 $360 $210 $255 $165 $180 $50 -----------$1,595 1.30% $83,469 67.86% Jul $75,000 $22,997 $350 -----------$23,347 $51,653 68.87% Aug $81,000 $24,834 $420 -----------$25,254 $55,746 68.82% Sep $95,000 $29,129 $450 -----------$29,579 $65,421 68.86%

M

k r a

in t e

P g

n la
$145,119 68.45%

r P

Jul $180 $0 $75 $360 $210 $255 $165 $180 $50 -----------$1,475 1.97% $50,178 66.90%

S o
Aug $384 $0 $160 $768 $450 $544 $352 $384 $50 -----------$3,092 3.82% $52,654 65.00%

m a
Sep $432 $360 $180 $870 $450 $612 $396 $432 $50 -----------$3,782 3.98% $61,639 64.88%

Oct $83,980 $25,754 $350 -----------$26,104 $57,876 68.92%

le p
Nov $83,000 $25,447 $350 -----------$25,797 $57,203 68.92% Nov $540 $0 $225 $1,080 $630 $765 $495 $540 $50 -----------$4,325 5.21% $52,878 63.71%

Dec $121,020 $37,098 $480 -----------$37,578 $83,442 68.95% Dec $624 $200 $260 $1,248 $728 $884 $572 $624 $50 -----------$5,190 4.29% $78,252 64.66%

Oct $456 $0 $190 $910 $530 $646 $418 $456 $50 -----------$3,656 4.35% $54,220 64.56%

Academic Version

Page 45

Sign up to vote on this title
UsefulNot useful