Student’s Name

Institution of Affiliation

Professor

Class

19th May 2022

Company name: Bonnie Bio Certified Compostable Plastic Alternatives

Street address 1:

Street address 2

City, state, ZIP:

Business Phone:

Website URL:

Email address;

Confidentiality Agreement

The undersigned reader acknowledges that any information provided by _________________________ in this business plan, other than information that is in the public domain, is confidential in nature, and that any disclosure or use of same by the reader may cause serious harm or damage to ________________________. Therefore, the undersigned agrees not to disclose it without express written permission from ________________________________.

Upon request, the undersigned reader will immediately return this document to ___________________________.

___________________
Signature

___________________
Name (typed or printed)

___________________
Date

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

Table of Contents

Confidentiality Agreement                                                                                                                           2

I. Instructions: Executive Summary                                                                                                           4

II. Instructions: Company Description                                                                                                       5

Company Description Worksheet                                                                                                             5

III. Instructions: Products & Services                                                                                                        6

Product & Service Description Worksheet                                                                                               6

IV. Instructions: Marketing Plan                                                                                                                9

Market research                                                                                                                                   9

Threats and opportunities                                                                                                                  10

SWOT Analysis Worksheet                                                                                                                      11

Product/service features and benefits                                                                                                12

Target customer,                                                                                                                               13

Key competitors                                                                                                                                14

Competitive Analysis Worksheet                                                                                                             16

Positioning/Niche                                                                                                                              17

Promotional budget                                                                                                                           18

Marketing Expenses Strategy Chart                                                                                                       18

Pricing                                                                                                                                               19

Location or proposed location                                                                                                          20

Distribution channels                                                                                                                        21

V. Instructions: Operational Plan                                                                                                             26

Production                                                                                                                                         26

Quality control                                                                                                                                  27

Location                                                                                                                                            27

Legal environment                                                                                                                            27

Personnel                                                                                                                                           28

Inventory                                                                                                                                           28

Suppliers                                                                                                                                           29

Credit policies                                                                                                                                   29

Management Worksheet                                                                                                                         30

Organization Chart                                                                                                                                  33

I. Instructions: Executive Summary

Bonnie Bio Certified Compostable Plastic Alternatives is a new company whose goal is to manufacture environmentally friendly products such as compostable plastic alternatives for the following items: disposable masks, 3-ply waste bags, and hot water soluble totes. The legal structure of this company is LLC (Limited Liability Company). The competition in this market is companies such as Newlight Technologies, a California-based company, Zenpack, and many others that manufacture disposable masks and similar products. The marketing plan for this company will be implemented through traditional marketing methods such as social media advertising, word of mouth advertising, and other online advertisements. The pricing for the items has yet to be determined; nevertheless, they will be competitively priced so that consumers will be ready to pay for them without hesitation. Distribution channels will be set up through Amazon Marketplace, Walmart Marketplace, and other major retailers like Target or Kroger, where customers can buy these types of products directly from them without having to go through an intermediary seller like Amazon or Walmart, which would increase costs incurred by the buyer due to shipping fees which could make them less likely to purchase. The distribution channels used include direct sales, Retail Sales, Online Sales, and sales representatives. The marketing plan includes promoting our products through social media sites like Facebook, Instagram, and Twitter. The marketing budget will also have paid search engine optimization (SEO), pay per click (PPC) advertising on Google AdWords and YouTube video ads for Facebook advertising campaigns, as well as paid search engine optimization (SEO) advertising on Google AdWords.

II. Instructions: Company Description

Company Description Worksheet

III. Instructions: Products & Services

Product & Service Description Worksheet

IV. Instructions: Marketing Plan

1.       Market research

Market Size: The worldwide market for compostable plastic alternatives is worth about $1 billion each year. Over the next five years, the growth rate is expected to be around 5% each year. This is because many challenges need to be overcome before this type of plastic can be used universally (Teymourian et al., 2021).

Size of Target Market-The total size of the target market is approximately $1.3 billion annually. There has been a steady increase in demand for these products, with an average annual growth rate of 8% (Taufik et al., 2020).

Trends in the target market – The plastic bag industry is growing at 2% per year due to increased demand from retailers who want to use this product to replace paper bags and other non-biodegradable options.

Barriers to entry

High startup costs: The startup cost for this business is about $32,000. The primary purpose of this investment is to purchase a state-of-the-art manufacturing facility that can produce compostable plastic alternatives. This includes the necessary equipment and machinery required to make plastic bioproducts.

High production costs: Several steps must be considered to produce compostable plastics. First, raw materials need to be sourced (i.e., corn starch). Second, the raw materials need to be converted into plastic bioproducts using high-temperature processes that require significant energy consumption (Teymourian et al., 2021). Third, these products must be sold at a competitive price.

High marketing costs: Marketing costs include advertising on television and radio channels and online advertising such as Google AdWords campaigns or Facebook ads.

Finding qualified employees: The current labor pool for the plastics industry is very small in the U.S., making it difficult for a startup company like Bonnie Bio to find qualified employees. However, this problem can be solved by hiring a larger pool of candidates from other countries like China or India (Taufik et al., 2020).

Need for specialized technology or patents: A patent is required for any new product you develop to protect your intellectual property rights from other companies trying to copy your idea or using it without permission. This barrier can be overcome by signing an NDA (nondisclosure agreement) with other companies who want to use your product or technology without authorization or credit.

Tariffs and quotas: Tariffs and quotas limit how much of a particular product can be imported into a country at one time. Directly selling from another nation, rather than through distribution channels in the U.S. (like Amazon), may help you over this barrier.

2.       Threats and opportunities

●       Changes in government regulations. The government can enact new regulations that would require Bonnie Bio’s products to be more difficult to manufacture or use. This would increase their cost of goods sold (COGS). In addition, if COGS grow too much, then Bonnie Bio may not be able to compete with their current competitors using non-biodegradable plastic alternatives.

●       Changes in technology. Technology is constantly changing and evolving, resulting in an innovation that makes it easier or cheaper for other companies to produce similar products as Bonnie Bios. Therefore, Bonnie Bio could lose market share and revenue if this new technology is introduced into their industry (Teymourian et al., 2021).

●       Changes in the economy. The economy can go through cycles where there is an abundance of money available or not enough money available; either way, this can directly impact Bonnie Bio’s profitability. This can affect how many disposable items are being sold and used. It can also affect the amount of funding available for R&D and marketing.

SWOT Analysis Worksheet

3.       Product/service features and benefits

Bonnie Bio Certified Compostable Plastic Alternatives is designed to assist in manufacturing waste bags, 3-ply disposable masks, and hot water soluble tote bags. The essential features of our product are that it is a biodegradable alternative to plastic. Our product will break down in a landfill, or compost bin in 30 days. It also has a lower carbon footprint than traditional plastic products. Our product is made from renewable resources like cornstarch and sugar cane which can be grown on farms. The 3-ply disposable masks are designed specifically for those who need protection from airborne particles such as dust and pollen without worrying about washing their face masks after use (Sijtsema et al., 2016). Each mask is designed with three layers of material, so when one layer becomes dirty, you replace it with another without ever washing it. Moreover, the most important benefits of our product are that it is better for the environment and less harmful to animals than traditional plastic products.

After Sales Services,

Product delivery: Bonnie Bio manufactures compostable waste bags foe will deliver the goods to your address via UPS or FedEx.

Warranty/guarantee: Our company is confident about its products and offers a guarantee of 100% satisfaction. If you have any questions or concerns about our products, please contact us immediately. We will be happy to help you out with any issues you may have with our products or services.

Service contracts: No service contract is needed – just call us anytime! We are here 24/7 to assist you in any way possible.

Ongoing support: Bonnie Bio can give ongoing support to our clients through email or telephone communication and by visiting your location personally if need be. All of our employees are always accessible to answer any queries you have regarding our products (Sijtsema et al., 2016).

4.       Target customer,

The target customer is anyone who needs plastic wrap or clings wrap replacement. This could be home users looking for an environmentally friendly alternative or people who need something more durable than wax paper when storing food in the refrigerator or freezer. The product may also be utilized as a sterile wrapping material in hospitals. Healthcare, food processing, pharmaceuticals, and the hospitality industry are just a few examples (Sijtsema et al., 2016).

For example, a grocery store’s target customers will be families with children between 0-5 years old. They will also likely have high incomes, allowing them to purchase more expensive items such as organic foods and specialty meats/seafood that require refrigeration. When it comes to businesses that want to reduce their carbon footprint and help the environment, they may be located in any part of the world, but they must have annual revenue of at least USD 100,000 (Scherer, Emberger-Klein, and Menrad, 2018).

Key competitors

1. Newlight Technologies is a California-based company. They produce a similar product called BioDegradable Plastic Alternatives (BDPAs). The company has been in business for about eight years. They are located in Oakland, CA, and have several employees (Mehta et al., 2021).  

2. Zenpack is a small startup based in Los Angeles, CA, in business since 2016. They produce a similar product called Plantware™, made from mushroom roots (mycelium) grown on agricultural waste like corn stover or wheat straw. Zenpack is another company that specializes in compostable packaging for food and beverage products (Sijtsema et al., 2016).

Competitor Data Collection Plan

Competitive Analysis Worksheet

5.       Positioning/Niche

A unique critical niche provides a more sustainable compostable alternative to plastic waste bags, 3-ply disposable masks, and hot water soluble tote bags. With our solution, customers may minimize their carbon impact by reducing the amount of plastic in landfills or seas (Allison et al., 2021). They will position themselves as a leader in the green movement by highlighting our company’s commitment to sustainability and providing the best product at an affordable price point for any type of business  (Mehta et al., 2021). Compostable Plastic Alternatives is positioned as an environmentally friendly alternative to petroleum-based plastics. This unique segment of the market has been growing for decades. Marketing Strategy

Bonnie Bio Compostable Waste Bags will be advertised using a variety of channels. We plan on promoting our products through online media such as Google Adwords, Facebook Ads, and Instagram Ads. We also plan to advertise through cable television spots and print ads in local newspapers and magazines. We will also be hosting an online contest where customers can submit their ideas for how they would use our product. The winner will receive $1,000 worth of free products (Sijtsema et al., 2016).

 Out-of-home advertising will be used at grocery stores and other nearby locations where customers may be interested in purchasing their products. We will also use mobile marketing through applications like Facebook Messenger, Instagram Direct Messages, and SMS Text Messaging (SMS). This will allow us to send out quick reminders about our products directly to customers who have already purchased them. We plan on spending about $200 per month on these marketing efforts.

The company wants to project an image of being a company that cares about its customers’ environment and health. My logo will be green and black with a leaf in the shape of an “L” for my last name (Leaf). Several leaves will be combined in a circular pattern to create the logo. I want to use a design element representing nature or plants because my product is compostable waste bags made from plant material (Bonney, 2009). The design should also be modern, with clean lines to appeal to all ages and genders. The interior design of the office space should have neutral colors like beige or white with accents of green like plants or nature scenes on the walls or other decorations that reflect nature.

6.       Promotional budget

Marketing Expenses Strategy Chart

7.       Pricing

The company has a well-defined pricing strategy for its products. They have set their prices at an average price level compared to other competitors in their industry. The company’s pricing strategy is designed to reflect the quality of its products and services offered to customers. The company believes that offering high-quality products and services will help them compete with large corporations that may offer lower prices due to economies of scale (Bonney, 2009). The company has decided not to compete on price but rather to provide high-quality products and services at average prices.

Pricing Strategy Worksheet

8.       Location of the proposed location

Location: I have chosen a place at an industrial park close to a major highway. This location allows for easy access by customers traveling from all over the country. The space is large enough for my business, and it has ample parking for employees and customers. The room is close to other companies such as banks, convenience stores, and restaurants. This will help with the marketing aspect of my business because there will be potential customers nearby when they need something from me.

Convenient Location: My location is suitable for both customers and employees because there is adequate parking on-site and public transportation nearby (bus stop). This makes it easier for people who do not have cars or do not want to drive themselves around town. If they do not have cars, they can take advantage of public transportation, saving them money on gas and parking fees and time spent searching for parking spots when driving around town (Koenig-Lewis, Grazzini, and Palmer, 2022). Lastly, the building we have chosen is a warehouse space located in an industrial park. There is plenty of parking available on-site, which will make it easy for our customers to drop off their waste material.

9.       Distribution channels

Inside salesforce - an inside sales force will be selling the products directly to retailers, distribution centers, and wholesalers. The company will also be hiring outside sales representatives to sell our product directly to businesses and consumers through home delivery programs, trade shows, and other events.

OEMs - The company has relationships with several OEMs who manufacture products with our material and sell them directly to consumers through retail channels such as Amazon or as part of their line of products sold online or in retail stores (Koenig-Lewis, Grazzini, and Palmer, 2022).

Outside sales representatives – Outside sales representatives will also be responsible for selling directly to customers or other businesses who wish to purchase our products directly from the company.

Distribution Channel Assessment Worksheet

V. Instructions: Operational Plan

1.       Production

The production process will require a vacuum forming machine to shape the product into its final form. The equipment used for this process can be found at most hardware stores and costs around 100 dollars (Gaffey et al., 2021). We will also need an oven to bake our products, and we will rely on our local bakery to provide us with one that they no longer need. The hot water-soluble bags will be made from high-density polyethylene (HDPE) derived from corn starch. This material is certified by the Biodegradable Products Institute (BPI). The compostable waste bags will be produced using HDPE material derived from sugar cane. This material has been tested by BPI and has been shown to pass their requirements for biodegradation at commercial composting facilities.

2.       Quality control

Bonnie Bio will use only high-quality raw materials that meet our strict specifications to ensure quality control and stability. The products will be produced in a controlled environment under strict temperature and humidity conditions to ensure consistency in product quality. The company will initiate a complete Q.C. program that includes sampling each lot during production and testing for chemical properties at periodic intervals throughout the year (Gaffey et al., 2021). All of the products will conform to the ASTM D6400 specification for compostability.

3.       Location

The business owner plans on leasing space at this location for at least another year before moving into a larger space elsewhere in downtown Los Angeles. The current lease rates are $2 per square foot per month plus additional expenses such as utilities, taxes, and insurance, which add up to about $6 per square foot per month total cost for rent alone (not including other expenses). The company is located in a warehouse easily accessible to our customers and employees. The company has been in business for one year, and the owners are currently looking to expand the business. The building consists of two floors, each with a separate entrance (Gaffey et al., 2021). The current owners purchased the building and renovated it into a modern office space. The building was used as an auto repair shop before they purchased it.

4.       Legal environment

The legal market is quite competitive. Because there are so many firms that create identical products, we need to be able to set ourselves apart by providing high-quality products at a reasonable price. At this time, I am not aware of any required licenses or permits. At this moment, I am not aware of any trademarks, copyrights, or patents. Before making any judgments about handling trash disposal at the location, the company will speak with an attorney who specializes in environmental law. They’ll also contact local government authorities to check if any educational programs or workshops on how to comply with their rules are available. All federal, state, and local regulations and local bylaws will be required of the company. The legal environment that Bonnie Bio Certified Compostable Plastic Alternatives will operate in is very favorable for business owners because there are no special regulations that apply specifically to our industry or business model (Zwicker et al., 2020). The insurance coverage required by the company is minimal due to the location and size of our operation. However, we do have worker’s compensation insurance that covers all employees, including part-time employees and volunteers who work for us on a volunteer basis when needed. The insurance coverage is $1 million for general liability, $1 million for property damage, and $1 million for employee injury.

5.       Personnel

The company will be looking for persons who can manage the business. For example, the C.EO will be responsible for running a small business, from ordering supplies to managing employees. The ideal candidate would have experience manufacturing or retailing products, but no specific educational requirements exist. The company will need salespeople who can work with customers to develop marketing strategies for their products. The company will also need an accountant who can help manage the business’s finances. The pay structure is hourly, with a $16/hour base salary. (Teymourian et al., 2021). They also plan to find qualified employees and contractors through word of mouth and Craigslist. Training is necessary for both employees and contractors. Employees will be trained on the products themselves and how to package and ship them out. Contractors will learn how to perform each assignment given by clients, such as bag wrapping or logo design for bespoke bags. Inventory

Work-in-Process: Work-in-process (WIP) is the inventory typically produced during manufacturing activities before it is completed and transferred as finished goods to other locations within or outside the organization’s facilities (shipped). Bonnie Bio will be using an inventory management system to manage its inventory ordering process, including forecasting demand and maintaining adequate stocks. Inventory turnover is an essential financial ratio used by management and investors to evaluate a company’s ability to convert its assets into cash  (Taufik et al., 2020). The higher the inventory turnover, the more efficiently the company uses its assets. It also indicates whether it has enough inventory to meet customer demand.

6.       Suppliers

•Name: Thomas Industries, Inc.

•Address: 1565 N. Highway 80, Little Rock, AR 72211

•Website: www.thomasindustriesinc.com/index1.html

•Credit rating: Excellent (Better Business Bureau)

•Delivery policy: Prompt Delivery; usually within 24 hours of order placement

• History and reliability: We have been using them for over ten years with no problems, and they carry a wide range of materials needed for our manufacturing facility (Gaffey et al., 2021). 

The suppliers are reliable and trustworthy. We have been dealing with them for many years. We have no reason to think that their credit or delivery standards will change soon.

7.       Credit policies

We will offer credit to all customers who have been in business for at least one year and have a minimum of $50,000 annual sales volume. We will extend credit for 90 days from purchase on an individual basis. We will also require a credit card number for each customer order over $500 (Sijtsema et al., 2016). New customers will be required to provide references from other companies with whom they have done business and a letter from their bank stating that they are in good standing. We will call these references and ask them about the quality and timeliness of the customer’s service and products. We will not give them credit if we have any concerns about their service, product quality, or timeliness. They must be in business for at least six months and receive favorable feedback from several other clients before we offer them credit. We will send a reminder notice 30 days after the due date of payment has passed if there are any late payments. If payment is still not received after 60 days, we will send out a second reminder letter informing them that if payment is not received within 15 days of receiving this letter

VI. Instructions: Management & Organization

Management Worksheet

Organization Chart

References

Adamcová, D., Radziemska, M., Zloch, J., Dvořáčková, H., Elbl, J., Kynický, J., ... & Vaverková, M. D. (2018). SEM analysis and degradation behavior of conventional and bio-based plastics during composting. Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, 66(2), 349-356.

Allison, A. L., Lorencatto, F., Michie, S., & Miodownik, M. (2021). Barriers and enablers to buying biodegradable and compostable plastic packaging. Sustainability, 13(3), 1463.

Bonney, M. (2009). 3 Inventory Planning to. Inventory Management: Non-Classical Views, 43.

Gaffey, J., McMahon, H., Marsh, E., Vehmas, K., Kymäläinen, T., & Vos, J. (2021). Understanding consumer perspectives of bio-based products—A comparative case study from Ireland and The Netherlands. Sustainability, 13(11), 6062.

Klein, F. F., Emberger-Klein, A., & Menrad, K. (2020). Indicators of consumers’ preferences for bio-based apparel: a German case study with a functional rain jacket made of bioplastic. Sustainability, 12(2), 675.

Koenig-Lewis, N., Grazzini, L., & Palmer, A. (2022). Cakes in plastic: a study of implicit associations of compostable bio-based versus plastic food packaging. Resources, Conservation and Recycling, 178, 105977.

Kymäläinen, T., Vehmas, K., Kangas, H., Majaniemi, S., & Vainio-Kaila, T. (2022). Consumer Perspectives on Bio-Based Products and Brands—A Regional Finnish Social Study with Future Consumers. Sustainability, 14(6), 3665.

Mehta, N., Cunningham, E., Roy, D., Cathcart, A., Dempster, M., Berry, E., & Smyth, B. M. (2021). Exploring perceptions of environmental professionals, plastic processors, students and consumers of bio-based plastics: Informing the development of the sector. Sustainable Production and Consumption, 26, 574-587.

Scherer, C., Emberger-Klein, A., & Menrad, K. (2018). Consumer preferences for outdoor sporting equipment made of bio-based plastics: Results of a choice-based-conjoint experiment in Germany. Journal of Cleaner Production, 203, 1085-1094.

Sijtsema, S. J., Onwezen, M. C., Reinders, M. J., Dagevos, H., Partanen, A., & Meeusen, M. (2016). Consumer perception of bio-based products—An exploratory study in 5 European countries. NJAS-Wageningen Journal of Life Sciences, 77, 61-69.

Taufik, D., Reinders, M. J., Molenveld, K., & Onwezen, M. C. (2020). The paradox between the environmental appeal of bio-based plastic packaging for consumers and their disposal behaviour. Science of the total environment, 705, 135820.

Teymourian, T., Teymoorian, T., Kowsari, E., & Ramakrishna, S. (2021). Challenges, strategies, and recommendations for the huge surge in plastic and medical waste during the global COVID-19 pandemic with circular economy approach. Materials Circular Economy, 3(1), 1-14.

Zwicker, M. V., Brick, C., Gruter, G. J. M., & van Harreveld, F. (2021). (Not) Doing the Right Things for the Wrong Reasons: An Investigation of Consumer Attitudes, Perceptions, and Willingness to Pay for Bio-Based Plastics. Sustainability, 13(12), 6819.

Zwicker, M. V., Nohlen, H. U., Dalege, J., Gruter, G. J. M., & van Harreveld, F. (2020). Applying an attitude network approach to consumer behaviour towards plastic. Journal of Environmental Psychology, 69, 101433.