VENTUM DELIVERY 1

Ventum Delivery – Business Plan

Student Name

Course Title
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Executive Summary
During the COVID-19 pandemic, eCommerce came in handy to help people to buy food

and other products from the comfort of their homes. However, as time progressed, there was a

surge in people requiring products from different retailers. Businesses like Walmart, which have

their delivery channels, were also overwhelmed by the many orders placed. This led to the need

for a third party that ensured that clients received their products on time. This paper provides an

analysis of the current delivery service in the USA and provides a solution to the existing gap

between deliveries and orders made. The theoretical and financial review indicates that Ventum

Delivery is a viable business and bound to succeed in the contemporary American business

environment. The report covers the business, financial analysis, and supplement information.
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Contents
Executive Summary.........................................................................................................................2

PART ONE: THE BUSINESS........................................................................................................4

Background of Business..............................................................................................................4

Market Analysis...........................................................................................................................5

Marketing Plan.................................................................................................................................7

Competition.................................................................................................................................8

Management and Operations.......................................................................................................9

PART TWO: FINANCIAL DATA...............................................................................................10

Service Price..............................................................................................................................10

Delivery Forecast.......................................................................................................................10

Financial Statements..................................................................................................................10

Balance Sheet.............................................................................................................................12

Assumptions to Projected Financial Statements........................................................................12

Break Even Analysis..................................................................................................................12

Sources and Uses of Funds........................................................................................................12

PART THREE: SUPPLEMENTAL INFORMATION.................................................................13

Conclusion.....................................................................................................................................15
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PART ONE: THE BUSINESS

Background of Business
The decision as to which business to start depends on many factors. At the core of these

reasons lies the desire to provide solutions to existing problems in society. For instance, the

COVID-19 pandemic is considered by far the worst ever to hit modern man. The virus not only

infected and killed millions of people around the world, but it also interfered with the social and

economic aspects of life. Drake et al. (2020) note that in the effort to fight the pandemic, many

governments, including the United States, were quick to impose traveling and movement

restrictions. Most businesses were forced to close down, with people being forced to rely on

periodic shopping. Luckily, the world was quick to leverage technological advancements to

conduct trade.

According to Bhatti et al. (2020), through eCommerce, people could buy products from

the comfort of their homes. As time progressed, there was a surge in the number of people

requiring products from different retailers. Businesses like Walmart, which have their delivery

channels, were also overwhelmed by the high number of orders placed (Huett and Chapman,

2020). This led to the need for a third party that ensured that clients received their products on

time. It is against this backdrop that Ventum Deliveries was formed. The goal is to solve the

current delivery problem by offering an efficient, reliable, fast, and affordable delivery channel.

Ventum is a Latin term for wind. The company borrows its vision from this term to

metaphorically indicate how the business will improve the consumer experience through fast and

seamless deliveries at all times.

Service Description
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Ventum is a start-up company that seeks to provide both corporate and domestic

deliveries at an affordable price. The company derives its passion from the existing market gap

where there is a need for reliable and efficient delivery channels between businesses and their

clients. More importantly, the company will adopt an all-inclusive approach to provide both

specialized and non-specialized deliveries. At the beginning of its operation, Ventum Deliveries

will provide non-specialized deliveries, including available products such as groceries, books, or

clothing. The decision to first handle this non-specialized delivery is crucial. It requires less of

amount of capital and also the pre-existing market from businesses, institutions, and individuals.

On the other hand, specialized deliveries will involve delivering products that are very

valuable, fragile, or sensitive—for example, radioactive materials, glassware, pharmaceuticals,

and electronics. Specialized delivery requires a high level of care and precision, thus being a

capital-intensive venture. However, in the long run, Ventum Delivery seeks to gain a competitive

advantage in the market by ensuring that both specialized and non-specialized goods are

delivered in a safe, efficient, reliable, and affordable way.

Non-
Specialized
specialized
Deliveries
Deliveries

Ventum
Deliveries
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Market Analysis
There is a phrase that goes, and the internet has transformed the world into a global

village. While this might sound like a cliché, this statement is very profound in the current

marketplace. Since its invention, the internet has slowly been infiltrated into different aspects of

human life. The use of this great invention transcends beyond communication and research into

sports, business, and health. According to Batinić (2015), businesses have been able to engage

and transact with people from all over the world through the internet. The geographical barriers

have been removed while the market size has been dramatically expanded. Unfortunately, even

though the sellers and buyers are connected through the internet, ensuring that the products reach

the destination is necessary. The COVID-19 pandemic exposed the market’s inadequacy in

efficient and affordable delivery services for specialized and non-specialized products in

America. With millions of people required to stay at home, the available delivery services are

overwhelmed by the high demands, thus cause delays, order cancellations, and all forms of

losses and inconveniences to buyers and sellers.

Even though the pandemic is almost under control and the economy is slowly opening

up, studies indicate that consumer behavior in the post-covid era is likely to change. This means

that, even though people are free to go shopping in the malls and restaurants, a high percentage

of people are likely to stick to shopping online, thus requiring delivery services. For instance,

according to research made by statista.com, the number of online shoppers in the USA has been

gradually rising over the years (Statista Research Department, 2021). The study finds the USA to

have one of the most significant online shoppers globally, with about 230.5 million people

expected to use this business model. This exponential growth of the number of online shoppers

indicates that the demand for delivery services is also on the rise. Similarly, IBISWorld studies

indicate that there has been a surge in the number of delivery companies (IBISWorld 2021).
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Such a positive increase in the number of delivery businesses is an indication that the business

idea is viable and applicable in the current and future American market.

Marketing Plan
In a highly aggressive market such as the American delivery service market, companies

need to actively engage in marketing activities to increase their brand awareness. Similarly, Dinu

and Dinu (2012) posit that a company’s marketing strategy is critical in increasing its market

share and sales, resulting in high revenues. However, before taking on the making plan, it is

essential to define the target market for Ventum Deliveries. The business will primarily be based

in Miami, Florida, thus operating in the entire state as it works on expanding to the neighboring

states. Besides, Ventum Delivery intends to serve people and businesses of varied socioeconomic

classes. More importantly, some of the institutions and businesses we intend to serve to include;

households, manufacturing companies, cafés, resorts, printing press, publishing houses,

supermarkets, grocery stores, schools, salons and beauty shops, hospitals, Corporations,

government institutions, celebrities, and students.

In this case, Ventum intends to use two main marketing methods, namely, advertising and

personal selling. To begin with, Ventum will actively engage its sales team to approach most

institutions in Miami and other surrounding areas. For instance, given the target market, the sales

team will be required to physically visit the manufacturing companies, cafés, resorts, printing

press, publishing houses, supermarkets, grocery stores, schools, salons and beauty shops,

hospitals, Corporations, and government institutions available in the region. Through

engagement, Ventum will slowly increase its brand awareness in the market and persuade them

to consider shopping with us. On the other hand, digital marketing will approach households,

students, professionals, and celebrities. Using social media platforms, google ads, a click-to-pay
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approach, and TV ads, Ventum will entice this market segment into considering us in their online

shopping experiences.

Competition
The success of any organization is highly dependent on how competitive the market is.

As stated initially, there has been a surge in delivery companies all over the world. Therefore,

Ventum Delivery needs to conduct a thorough competitor analysis to ensure that it offers

competitive prices to the market while still making sustainable profits. On that note, we discover

that on the non-specialized delivery, the main competitors are Postmates and Instacart. To begin

with, Postmates is an American quick-commerce and food delivery service that Uber owns.

Today, the company provides services to more than 2940 cities in the USA, including Miami

(Curry, 2021). The company offers a $20 delivery fee and a 19.99% service fee payable for

orders made in organizations that have not a partnership with Postmates.

On the other hand, Instacart is also an American company that provides delivery services

in the USA and Canada. The company charges a fee of $7.99 for deliveries made within one

hour or $5.99 for two-hour or more delivery (Instacart, 2021). Like Postmates, Instacart has a

service fee that applies for deliveries made from organizations that have no partnership with

Instacart.

These two companies are already offering high-quality services in terms of urgency and

safety of the delivery. However, since these companies are enormous, they lack a personalized

culture that suits the southern identity. Therefore, to effectively compete with them, Ventum

seeks to win over the local market in Florida and other southern states by employing and actively

engaging in their values and beliefs. More importantly, the company will provide high-quality
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delivery services at affordable prices coupled with tracking services and insurance for high-value

products in transit.

Management and Operations

Board of
Directors

Operations Finance Marketing

Department Department department

Cash
Manager Disbursement
Team

delivering
Agents

The figure above indicates the proposed organizational structure at Ventum Delivery. The

company will be headed by a board of directors who will foresee decision-making and policy

formulation. There are three central departments under the board of directors, namely, operation,

finance, and marketing departments. Other employees in the company include; accountants,

web/app developers, delivery personnel, sales personnel, customer support, and security

personnel. The flow of activities at Ventum involves receiving an on-demand request through

calls, emails, and app requests from clients. The customer support will then prepare the inventory

list before assigning the delivery personnel tasks upon confirmation and payment. After the

product is collected, the delivery agent notifies both the client and the customer support via the

app, SMS, or email notification. The process of delivery then begins depending on the urgency.
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PART TWO: FINANCIAL DATA

Service Price
The price of our delivery will be a flat rate of $10 regardless of the timing of the delivery.

Based on the market analysis, the company will predominantly operate in Miami, Florida, which

is an average city regarding social-economic status. Besides, to develop this price rate, Ventum

considered the prices and rates offered by its main competitors Instacart and Postmates in the

Miami area. Each of these companies charges a flat rate, service fee, and encourage tip to their

clients. Therefore, the main reason we chose a flat rate of $10 for deliveries within Miami is that

it is much more affordable for the people in the city. Such a price tag will offer competitive rates

for our competitors while still enabling us to earn a sustainable income.

Delivery Forecast
In the first year, Ventum will concentrate on providing delivery services within Miami

city. According to US Census Bureau (2021), the 2019 census indicates that Miami city has a

population of 467963. Besides, out of the total population, 358,459 are above the age of 18

years. Besides, Miami is ranked sixth among the cities in the USA that use online shopping

(MicroD, n.d.). Therefore, it is fair to assume that more than half of Miami’s adult population

utilizes delivery services. On that note, Ventum aims at making 10000 deliveries in the first

twelve months before increasing its delivery rates by 1.5% in the subsequent years. This number

of deliveries was arrived at after close monitoring of the deliveries made by both Instacart and

Postmates in the early years. For instance, Curry (2021) indicates that in 2016 Postmates made

1.5 million deliveries per month. And assuming that the deliveries grew at the rate of 1.5% per

year, Postmates had 2.3 million sales in the first year, translating to 197530 deliveries per month.

This is within our monthly estimates.

Financial Statements
Income Statement
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An income statement is a financial statement indicating the company’s income,

expenditure, and profit, as indicated in Appendix 1. In this case, our fees and sales are generated

from the research made on the two main competitors. We are convinced that we can produce a

reasonable prediction of the deliveries made and revenue generated using these figures. Besides,

with the current market in favor of delivery companies, good marketing strategy, and advertising

are likely to improve our deliveries at the 1.5% rate per annum. To find the fee earned for the

first year, we multiplied the projected number of deliveries by the rate per delivery for the 12

months (10000 deliveries* $10* 12 = $1200000).

On the other hand, the annual expenses were arrived at by summing estimates as follows.

Office rent in Miami is estimated to be $8000, advertising expenses are estimated to cost about

$6000, Phone and Internet $2000, insurance $10000, vehicle maintenance will be $10,000, and

bank loan repayment $20000 (see Appendix 1). The other necessary expense will be salaries and

wages of employees which will be distributed as follows.

Employee Hourly salary ($) Estimated Salary Estimated year

(S$) salary ($)
Director 1 17.07 2958.33 35499.99
Manager 1 17.07 2958.33 35499.99
Manager 2 17.07 2958.33 35499.99
Accountant 17.07 2958.33 35499.99
Driver 1 8.65 1500 18000
Driver 2 8.65 1500 18000
Customer care 8.65 1500 18000
Security 8.65 1500 18000
Total compensation 102.88 17833.33 214,0000

In the long run, the total expenses amount to $270,000 which when subtracted from the

fee earned results to net income of $930,000. It is important to note that the expenses are

subjected to change as time progresses.

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Balance Sheet
The balance sheet is elementary for our service. In this case, our balance sheet has the

asset and liability categories as indicated in appendix 2. To begin with, the assets have been

divided into two, Current assets and fixed assets. The current assets include cash in the bank and

prepaid expenses, which amount to $88,391. The fixed assets include Delivery vehicles and

furniture, and Equipment which amounts to $90,000. On the other hand, the current liabilities

include taxes, while long-term liabilities include a bank loan of $100,000—the two columns

balance with a net worth of $55,208.

Assumptions to Projected Financial Statements

Break Even Analysis
From the previous section, it is evident that several expenses must be incurred for the

business to run smoothly. On that note, even though the business may be actively operating,

making sales, and registering an increase in revenue, these expenses tend to utilize most of what

the business generates. Thus, businesses need to determine when they will break even.

According to (0), the break-even point is when a business’s expenses will be equal to the revenue

generated. This step is crucial in Ventum Delivery as it will enable us to determine the practical

application of cost functions. The break-even point assumes that the expense and revenues,

among other things, will remain linear. The formula to find the break-even point = Fixed Costs ÷

(Revenue per unit – Variable cost per unit). In this case, the fixed costs are worth $270,000,

while the revenue per unit delivery is $10. Therefore, the break-even point for Ventum is 27000-

unit deliveries or 225 deliveries per month.

Sources and Uses of Funds

As stated before, Ventum Delivery is a business that seeks to provide both corporate and

domestic delivery serves in Miami and the state of Florida. On that note, the primary source of

income comes from the delivery of products to our clients. Besides, the company is a limited
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liability company between me and my long-term friend Jerome who will take the manager’s

position. On that note, we are required to find ways to fund our business idea. The two main

ways we generated funding for the business include; money from our savings and bank loans.

Jerome and I invested $50000 each before applying for a loan of $100000 from the bank. In

total, the capital invested in the company was $20000. The table below indicates the different

ways through which the amount was spent.

Start-Up item estimated cost

Office Space (Deposit) $1,476
Salaries and Wages $17,833
Supplies: Technological, Equipment, Furniture, Other (computers, $10,000
software, copy machine, desks, chairs, etc.)
Adverts and other Promotions $1,500
Phone and internet $800
Insurance $800
vehicle $80,000
Total start-up cost $112,409
Total capital $200,000
Difference $87,591

PART THREE: SUPPLEMENTAL INFORMATION

Ventum Delivery is a service company that seeks to provide delivery services to people

within Miami city in Florida. The company derives its motivation from the existing gap between

orders made by people and the deliveries made by sellers. The company seeks to enter a very

lucrative yet highly competitive business market. According to Wu et al. (2020), the COVID-19

pandemic resulted in massive disruptions in many people’s lives worldwide. The restrictions put

forward by the World Health Organization and the US government had a negative implication on

the economic environment. As a result, businesses were forced to adopt new business strategies

that would enable them to provide products to their clients while surviving economic hardship.

This created a surge in demand for delivery services in America and beyond.
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It is also important to note that Ventum Delivery is likely to face several risks that may

hinder service delivery like most businesses. Some of these risks include; increased competition

from other companies within and without the region, lack of customer awareness, the potential of

goods damages and car accidents, and weak technology that malware may affect. Besides, the

main threats come from finance, when they may be holdups in money transfer. However, as a

company, we have plans that will help shield ourselves from these risks. Some of them include

buying insurance cover for the goods in transit, conducting aggressive marketing to enlighten the

public on our services, and hiring skilled personnel.

From the competitor analysis, it is clear that Ventum delivery will be competing with

well-established companies for the delivery market in Miami. The company is prepared to

conduct aggressive marketing to ensure that the brand is well known in the region. The previous

section identifies the main consumer segments to include households, manufacturing companies,

cafés, resorts, printing press, publishing houses, supermarkets, grocery stores, schools, salons

and beauty shops, hospitals, Corporations, government institutions, celebrities, and students.

Therefore, the marketing campaign will strategically seek to entice these market segments. For

instance, through social media campaigns, the company will carry out promotions and

competitions to increase brand awareness.

A great example will be the #ventumchallenge, where our clients will be required to take

a picture of themselves either sending or receiving a parcel through Ventum deliveries and

posting it on Instagram. The one with multiple posts will be selected for free delivery services

for a whole year. This campaign will aim to improve brand awareness and increase conversation

regarding Ventum on social media. Other ways to promote our services will include issuing
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business cards, Tv commercials, Corporate Social Responsibility (CSR), issuing flyers and

shirts.

Also, as part of its operation plan, Ventum Delivery will partner with various businesses,

schools, law firms, restaurants, and retailers. In this case, when clients order from these partners,

they will receive a delivery discount, while Ventum will gain a percentage from the total amount

of goods purchased. Besides. The delivery process will begin with customers placing their orders

through the website. The customer service personnel at Ventum will then create a list of the

goods required before forwarding them to the delivery agents. Payment will be done through

various ways, including cash, digital transfer, and credit/debit cards.

Conclusion
Summarily, the theoretical and financial review indicates that Ventum Delivery is a

viable business and bound to succeed in the contemporary American business environment.

Besides, the current COVID-19 pandemic has dramatically improved the e-commerce industry,

which has left businesses and their customers yearning for a more efficient delivery system.

Studies confirm that people are likely to retain the behavior of getting shopping online instead of

physically going to the shopping malls. The convenience offered by Ventum Deliveries will be

enough to win the markets.

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Reference

Batinić, I., (2015). The role and importance of internet marketing in modern hotel

industry. Journal of Process Management. New Technologies, 3(3), pp.34-38.

Bhatti, A., Akram, H., Basit, H.M., Khan, A.U., Raza, S.M. and Naqvi, M.B., (2020). E-

commerce trends during COVID-19 pandemic. International Journal of Future

Generation Communication and Networking, 13(2), pp.1449-1452.

Curry, D. (2021). Postmates Revenue and Usage Statistics (2021). Business of Apps. Retrieved 2

October 2021, from https://www.businessofapps.com/data/postmates-statistics/.

Dinu, G., & Dinu, L. (2012). The impact of advertising on consumer behavior in the Resita city

population. In Annals of DAAAM for 2012 & Proceedings of the 23rd International

DAAAM Symposium Intelligent Manufacturing & Automation: Focus on

Sustainability (Vol. 23, No. 1, pp. 1047-1050).

Drake, T.M., Docherty, A.B., Weiser, T.G., Yule, S., Sheikh, A. and Harrison, E.M., (2020). The

effects of physical distancing on population mobility during the COVID-19 pandemic in

the UK. The Lancet Digital Health, 2(8), pp.e385-e387.

Huett, E. and Chapman, L., (2020). Instacart’s Frantic Dash From Grocery App to Essential

Service. [online] Bloomberg.com. Available at:

<https://www.bloomberg.com/news/features/2020-05-06/instacart-was-overwhelmed-by-

coronavirus-overnight> [Accessed 1 October 2021].

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IBISWorld, (2021). IBISWorld - Industry Market Research, Reports, and Statistics. [online]

Ibisworld.com. Available at: <https://www.ibisworld.com/united-kingdom/market-

research-reports/postal-courier-activities-industry/> [Accessed 1 October 2021].

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https://www.instacart.com/.

MicroD. Top 10 Most Popular Cities for Online Shopping | MicroD. MicroD | Online Solutions

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https://www.microdinc.com/blog/top-10-popular-cities-online-shopping/.

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Retrieved 2 October 2021, from https://www.statista.com/statistics/272391/us-retail-e-

commerce-sales-forecast/.

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ST045219.

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overview, Journal of the Chinese Medical Association: Volume 83 - Issue 3 - p 217-220

doi: 10.1097/JCMA.0000000000000270
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Appendix 1: Income Statement

Ventum Delivery
Income Statement
For the year ended October 1, 2022
fees earned $1,200,000
Total Revenue $1,200,000
Operating Expenses
Office rent $8,000
Salaries $214,000
Advertising Expenses $6,000
Utilities: Phone and Internet $2,000
insurance $10,000
bank loan 20,000
maintenance costs 10,000
Total Expenses $270,000
Net Income $930,000

Appendix 2 Balance Sheet

Ventum Delivery

Balance Sheet

October 1,2022

Current Assets Liabilities and Net worth

Cash in bank $87,591 Current Liabilities

Prepaid expenses $800 Accounts Payable

Total $88,391 Taxes payable $17,833

Total current Liabilities $5,350

Fixed Assets $23,183

Delivery Vehicle $80,000 Long term liabilities

Furniture and Equipment $10,000 Bank Loan $100,000

Total Fixed Assets $90,000 Total Liabilities

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Total Assets $178,391 $123,183

Net Worth $55,208