business plan_final plan
TRANSCRIPT
“Newborn Stories” Photography Studio
BUSINESS PLAN (2016-2018)
8/4/2016 ENMANUEL CARDOZO | [email protected] | +1-647-609 -2640
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Table of Contents
Table of Contents ...............................................................................................................................1
Executive Summary ............................................................................................................................3
1. Company Profile .........................................................................................................................4
1.1. Business Overview ............................................................................................................................ 4
1.2. Company History .............................................................................................................................. 5
1.3. Vision and Mission ........................................................................................................................... 5
1.4. Management .................................................................................................................................... 6
1.5. Legal Structure.................................................................................................................................. 6
1.6. Location ............................................................................................................................................ 6
1.7. Strategic Alliances ............................................................................................................................ 7
1.8. Professional Advisors ....................................................................................................................... 7
1.9. Goal & Objectives ............................................................................................................................. 7
2. Market Research ........................................................................................................................8
2.1. Industry Profile and Outlook ............................................................................................................ 8
2.2. Local Market ..................................................................................................................................... 8
2.3. Market Potential & Market Share ................................................................................................... 9
2.4. Keys to Success ............................................................................................................................... 10
2.6. Target Market ................................................................................................................................ 12
3. Marketing ................................................................................................................................ 13
3.1. Positioning Statement .................................................................................................................... 13
3.2. Product Presentation ...................................................................................................................... 13
3.3. Pricing Strategy .............................................................................................................................. 14
3.4. Marketing Strategy ........................................................................................................................ 15
3.5. Marketing Objectives ..................................................................................................................... 18
4. Operations ............................................................................................................................... 19
4.1. Location .......................................................................................................................................... 19
4.2. Initial Capital Expenditures ............................................................................................................ 21
4.3. Legal and Insurance ....................................................................................................................... 23
4.4. Human Resources ........................................................................................................................... 25
4.5. Process / Production....................................................................................................................... 26
4.6. Risk Assessment .............................................................................................................................. 26
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5. Finance..................................................................................................................................... 27
5.1. Start-Up Costs ................................................................................................................................. 27
5.2. Sales Forecast ................................................................................................................................. 28
5.3. Cash Flow ........................................................................................................................................ 29
5.4. Income Statement .......................................................................................................................... 31
5.5. Break Even Analysis ........................................................................................................................ 32
5.6. Capital Requirements ..................................................................................................................... 32
Resources ........................................................................................................................................ 33
Appendices ...................................................................................................................................... 34
I. Industry Canada, NAICS “Definition of the Sector” ....................................................................... 35
II. Industry Canada, SME Benchmarking ........................................................................................... 36
III. Statistics Canada ............................................................................................................................ 38
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Executive Summary
Newborn Stories’ was born from the passion of capturing unique moments in everyday life of families
their children, we want to create memories that they will cherish for years to come. Newborn Stories
wants to focus on offering not only photographs but a story to tell through images that will last a
lifetime, starting from Maternity photographs, Newborn, special occasions and family portraits. Each
moment is a snap shot of a unique stage of their lives.
Market research shows that despite the vast growth of photography medium through the availability of
digital cameras and embedded cameras in smartphones, there’s still a large market potential $3.75M
per year, of target customers that give birth each year and are interested in the photographic services
taken by a professional because they still perceive that photographers have a unique way of perceiving
and capturing the world, and that’s the great value that Newborn Stories offers its clients.
Newborn Stories knows how important it is to grow its client base by building on its network of
connections through word of mouth and key alliances with relevant names and events in the family
industry in Toronto. Our primary target market is the young parents and millennials from diverse ethnic
and cultural origin. They are driven naturally by change and are very open to new trends in the market
(fashion, technology, etc.). They see themselves in a positive light, successful and are concerned with
the social and ecological problems that we face today worldwide. But most importantly, they are driven
by technology and social media, that’s why reaching out to them in this medium is of the most
importance, and to keep marketing costs and expenses to a minimum.
Newborn Stories’ initially will be a home based business given that the cost of renting a studio space
Downtown Toronto is quite expensive and we first need to test the market to ensure a progressive and
healthy growth cycle. Typically the orders from the clients will be placed from the online website
through a booking system, through telephone call or personally after meeting the client. Other critical
initial costs are related to the studio equipment which makes up a large percentage of the initial
expense, and also the insurance for incurring in this business.
Photoshoots will be done 5 days a week, at a maximum of 3 shoots per day. Newborn Stories is
projected to break even on the 2nd year in the second trimester when it reaches its breakeven point of
590 photoshoots. With an estimated $20K start-up cost of which 40% will be contributed by the owner,
40% futurpreneur loan and the remaining 20% on a BDC loan.
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1. Company Profile
1.1. Business Overview
Newborn Stories’ main goal is to capture these unique moment in her/their life that they will cherish for
years to come, and by doing so we are able to offer them the same benefit along the way since the
these customers all progress along the timeline, first maternity, then newborn, baby’s first stages, first
year, and that’s why Newborn Stories wants to focus on offering not only photographs but a story to tell
through images that will last a lifetime.
It’s important to offer an affordable yet profitable package that will attract parents into this chain of
action, focus on the customer relationship since day 1 and build a strong bond of trust that will lead
them to refer us to other family members and friends.
Newborn Photography session
The main product offered is a photography session of 3hrs with the client’s newborn. This package paid
is only for the time and artistic value. The digital photos and prints are sold separately to the customer.
Thus the pricing for this package isn’t a premium price but rather an overall average asking price in the
market for a high value product without breaking the budget of the customer.
Maternity Photography session
Maternity photographs as any other stage of a woman’s life with her children is a very important one
and critical to obtaining this customer on the long term. Maternity photographs are between 1-2 hrs
long and like any of the 3 products offered; it can be done outdoors or indoors (studio or client’s home)
according to the season and the client’s preference.
Family Photography session
Families are always looking to capture unique moments in their life with their young children as they
grow since it’s an event that only happens once. Newborn Stories believes that by capturing natural,
non-posed and unique lifestyle photographs in a more spontaneous way adds more value to the finished
product since real emotions and character of the individual’s surface and are evoked when looking back
at the photograph.
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Photography Prints
Additional profit can be increased substantially by upselling to the customer additional products and
services, such as prints, digital files, albums, bundles, birth announcement cards, etc.
Lastly, our studio offers the opportunity to directly help other children and newborns in need from other
countries through partnership programs with charities, giving our customers the satisfaction of helping.
1.2. Company History
Enmanuel Cardozo, first discovered photography during his architectural studies in 2007 when a student
contest was done. He participated by taking spontaneous photographs of people in the streets and
quickly made it his main hobby since then. Everyday life photography and naturally lit portraits are his
focus when shooting, and is this technique, which is not easy to master the focus of Newborn Stories.
Just recently after arriving in Canada, he wanted to convert his hobby into a business idea, and newborn
photography came as a consequence of expecting a child of his own. Telling the story of these newborns
and of their greatness as they are all filled with dreams, passions and energy that inspires the old.
Bringing joy to the families when they can look back at their photographs and feel comfort in
immortalizing that memory, while at the same time Newborn Stories wants to make an impact in other
children’s lives who might not have the opportunity to live a healthy life due to the lack of medicine,
food and/or water.
1.3. Vision and Mission
Vision
Newborn Stories Photography Studio aspires through their core values, to be the leading newborn
photo studio in Toronto by the end of 2017, adding value to our services through great customer service
& experience, customization and by making an impact in the life’s of other children in need from third
world countries through partnerships with charity programs.
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Mission
Newborn Stories mission is to create an everlasting memory of your newborn, from the moment their
heart starts beating with life, and to capture those passionate moments in your family’s life that are
priceless and that you’ll always want to look back to relive them, all while contributing to give other
newborns the opportunity to improve their lives through our partnerships with charities thanks to your
help.
1.4. Management
Enmanuel Cardozo, President/Founder of Newborn Stories has more than 8 yrs of experience in
photography, most of which was self-taught by reading dozens of books, online tutorials and courses. He
previously worked with other photographers in different sectors of photography like fashion, events and
weddings, first as assistant and later as main photographer in these events. His expertise is portraits
done in natural lighting, capturing spontaneous unique moments that cannot be replicated in a
commercial setting. He also has some marketing background since he’s passionate for enhancing
customer experience with the business by leveraging social media tools available.
1.5. Legal Structure
Newborn Stories is a sole proprietorship at first since it will be only operated by the owner from home
and later on expand into a studio at a separate nearby location with an assistant to assist in the shoots.
Incorporating the business is being considered for this stage of the business but it’s still under
evaluation.
1.6. Location
Newborn Stories will be at first operated from home at a downtown location of Sherbourne and Yonge
area since it’s easy to connect in all 4 directions using the subway system. We want to offer our clients
the flexibility and comfort of doing on-site photographs, whether it is a park of choice or their homes by
taking the equipment necessary to their location. But since seasonal weather plays a key role in this, we
also will provide a small but cozy studio area in the photographer’s home which will be equipped
adequately to get the best shots possible.
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1.7. Strategic Alliances
1.8. Professional Advisors
Accountant: will be responsible for filing the tax returns in a timely manner each year and other
financial advice. Yearly Cost: $500-$1000
Small Business Lawyer: will be responsible for writing the legal documents and for legal advice on some
matters that might arise. Yearly Cost: $1000-$2000
1.9. Goal & Objectives
Goal: Newborn Studios will become one of the top 3 baby photography services in Toronto in 2018 by
growing its network through nurturing client relationships and great customer service.
Objective 1: Breakeven on the beginning of the second year of operation.
Objective 2: Increase by 15% the number of clients by the end of Year 1.
Objective 3: Hire a full-time assistant for photoshoots at the beginning of Year 2.
Newborn Stories
Strategic Alliances
Hospitals & Clinics
Event Planning
Companies
Parenting Groups
Social media
influencers
Friends & their
network
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2. Market Research
2.1. Industry Profile and Outlook
Newborn Studios will operate in the photography services industry of Toronto, Canada. Although this
industry has been affected by the advancements of technology since the introduction of digital cameras
and smart phones, it is still an industry which is valued by potential customers for its artistic value and
technical demand that the average person cannot replicate even with the same equipment.
The key competitors for newborn photography in Toronto are:
Chandra Lee Photography Honeybourne Studio Peekaboo Studios
“Newborn & Maternity Photographer” “Newborn Photography” “Newborn. Babies. Maternity.”
The global photography industry is evolving towards live stream photography, augmented reality and
360 photography / video. Although it’s quite different from traditional photography, there’s value in
these new forms of photography, as well as a threat to the business if they are not somehow integrated
in the future. They can also provide a competitive advantage versus Toronto’s competitors since most
photographers in the industry haven’t implemented these.
2.2. Local Market
At first the business would be operating without a physical location, and rather will be going to the
specific locations in Toronto and GTA, where the family’s located for an indoor shoot or outdoors shoot
depending on the weather conditions. This will greatly reduce the operating expenses, and reduce the
risk in case the profits are not what were expected from this market.
When the business is more stable and customers are readily booking their sessions in advance, and we
have enough revenue to invest in leasing a physical location, then we will proceed to evaluate a location
that is accessible for our customers and rent a floor space to accommodate the necessary things.
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As shown in the above image, the three major competitors in the business are located in the outskirts of
Toronto, which is very far for the average client who has to travel on transit or even by car depending on
the time of the day, with an average time of 1h 20mins – 2hrs.
2.3. Market Potential & Market Share
Births Canada (2013): 388, 729 – 100%
Births Ontario (2014): 144,395 – 22% of Canada’s births
Births Toronto (2013): 31,291 – 8% of Canada & 22% of Ontario’s birth
Toronto Population (2015): 2,839,180
Latin American Community - Based on Language spoken at home (2011):
o Canada: 381,280
o Ontario: 172,560 – 45 % of Canada’s Latin Community
o Toronto: 79,497 – 46 % of Ontario & 2,8 % of Canada’s Latin Community
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Assumption 1
Based on these figures, Toronto is the city with the highest rate of births in the country, thus it
represents a larger market with more market potential and profitability for Newborn Stories’
photography service.
Assumption 2
The Latin American community has an average rate of birth as the rest of the community, and since they
represent 2.8% of the population of Toronto, we also assume that 2.8% of the births in Toronto are Latin
American origin. Thus:
Latin American Births: 2.8% x 31,291 = 876 births/yr.
Assumption 3
The average purchase of a typical customer would be $400, we also assume that this is not a one-time
purchase; around 20-30% of the customers return approximately a year later for another session for
their newborn’s first year photographs.
876 Latin newborns x $400 avg. spend = $350,400 per yr.
Assumption 4
Based on this previous result, we consider that the target market of solely Latin American’s is not
profitable enough since only a 30% of the newborns’ families will be interested in purchasing the
product and services. We will expand the market to include all family origins and ethnicities:
31,291 Toronto newborns x $400 avg. spend = $12,516,400 per yr.
30 % x $12.5M = $3.75M per yr. market potential in Toronto
2.4. Keys to Success
Consistently networking to expand Newborn Stories’ contacts and business referrals.
Nurture customer relationships and customize each interaction to suit the client.
Effectively use social media tools and other marketing medias to leverage our position.
Stay up to date with current photography practices and technologies.
Contract professional services for designing some of the essential branding material.
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2.5. SWOT Analysis
Competitor Strengths Weaknesses Opportunities Threats Newborn Stories
+8yrs of experience. International recognition.
Online presence.
Design & marketing background.
New to this type of photography.
No experience handling babies.
Infant CPR training New to Canada marketplace.
Large Spanish & Russian community.
Future father, great opportunity to connect.
Millennials are looking forward to establish themselves long-term in Downtown Toronto.
Canadian dollar decrease in purchasing power.
Competitive market, lots of new residents offering service for very low price.
Technological advances in photography shift market conditions very quickly.
Chandra Lee Photography
Photographed +600 babies.
Google search 1st
page.
Studio lighting.
Recognized member of NAPCP (National Association of Professional Child Photographers)
Too much information/text on the website.
A bit high priced by $50-$100.
Lack flexible/ customized packages.
No Natural light, outdoors.
Establish personal contact with clients, greet them and negotiate terms of package.
Deliver on-site service/ outdoors.
Offer outdoor sessions in summer and spring.
Honeybourne Studio
1st
in google search “newborn photographer Toronto”.
Good at capturing intimate moments.
Member of NAPCP (National Association of Professional Child Photographers)
Slow loading website images.
Poor website design, lack of information.
Low use of social media sites and very low engagement.
Enhance user experience throughout all the social media sites.
Deliver on-site service/ outdoors.
Update to more user-friendly website. Engage users more proactively.
Offer outdoor sessions in summer and spring.
Peekaboo Studios
Very well designed site.
Consistent & unique look of photographs.
Very good branding elements.
1st
page of google search. +5yrs in business.
High priced by $50-$100.
Very low engagement with users (not responding to their comments).
Enhance user experience throughout all the social media sites.
Deliver on-site service/ outdoors.
Engage users more proactively.
Offer outdoor sessions in summer and spring.
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2.6. Target Market
Newborn Stories’ PRIMARY target market is the young parents and millennials from diverse ethnic and
cultural origin. They are driven naturally by change and are very open to new trends in the market
(fashion, technology, etc.). They see themselves in a positive light, successful and are concerned with
the social and ecological problems that we face today worldwide.
Demographics:
Age: 25-35 yrs
Sex: Mainly Female & Couples
Geographic: GTA
Household Income: + $80,000 (CAD)
Marital Status: Married, Common Law.
Education: College / University
Psychographics:
Lifestyle:
o Lives a healthy lifestyle, eats some organic foods (mainly the female partner) and
exercises moderately.
o They are regular users of social media platforms, such as Facebook, Instagram and
Pinterest.
o They value art to reasonable extent, recognize the artist’s craft as valuable and place
quality over economy in most cases that are of important concern.
o Family and friends come first, social meetings is one of their most common activities on
the weekends.
o They care and value social initiatives.
Our SECONDARY segment is that family group (a bit older) which is expecting a new child or wants some
family photos taken with a fresh new eye and were likely previous customers of our competitors. And
Our TERTIARY segment is that group of customers that felt his interests aligned with ours and wants
some photographs of an extension of his family, such as a pet, birthday party, or wedding. Although this
is not our main focus, we can consider it as an opportunity for additional profit if necessary.
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3. Marketing
3.1. Positioning Statement
To be seen as a very professional photography studio that engages with its customers actively
and creates the most mesmerizing photographs of their newborns in a creative and unique
manner.
3.2. Product Presentation
The product will be exhibited online through the social media platforms including a website.
Simplicity is the key concept, less elements to allow easy navigation, faster load times and more
user friendly. The homepage will have single large image that will transition into another, while
strategically placing action buttons to take them to the required area for further information.
Soft colors that relate with the delicate and softness of newborns, but the freshness of new life
(ex. Green, white, light brown).
Sample Homepage:
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3.3. Pricing Strategy
The prices will be established based on two factors: operating cost/ hours worked and competitive
pricing in the premium level of the market.
Information of the competitor’s pricing will be gathered and analyzed to determine an optimal
price/value relation, and simultaneously perform some primary research on the target group’s price
sensitivity through surveys or a focus group.
Discounts will be offered through various practices such as special promotion days related to
festivities/ holidays, bundle purchases, referrals, or in the event of a customer complaint for
example to re-establish a positive relationship with that customer.
Careful measures have to be taken and evaluated in relation with the inflation/ Canadian dollar
fluctuations to fine-tune our asking price and the risk of a further devaluation.
The customer can choose from several packages that will be available according to his budget with
the option of upselling in the future if he’s satisfied with the product/ services he previously
purchased.
Ideally we will provide various forms of payment both debit/credit and cash. Customers tend to
purchase/spend more when credit card payment is available, thus giving us opportunity for greater
yield and this will also help record transactions much easier for tax purposes.
Pricing will be customized to customer’s need, but the general guideline will be the following
based on Newborn Stories’ 3 main competitors in Toronto which are a bit overpriced.
o Maternity & Newborn Session (2 x 3hrs session) - $600 – 40 photographs
o Newborn Session (1.5 - 2hrs) – $300 – 10 to 15 photographs*
o Maternity Session (1.5-2hrs)- $300 – 10 to 15 Photographs*
o Family Session (1.5-2hrs)-$300- 15 to 20 Photographs*
o Albums & Prints (TBD) **
*All these prices can vary according to the amount of final photographs or time the client wants or if
different locations are requested.
**Albums and prints come in several sizes and materials, the price range would be anywhere between
$60 to $500 according to the size and quality of the finished material.
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3.4. Marketing Strategy
Overall Marketing Strategy
Newborn Stories’ overall marketing strategy centres itself on customer relationship and networking, and
we believe that these are the pillars of our business. That’s why we will focus our marketing efforts on
networking activities with key alliances such as hospitals, trade shows, parenting groups and social
media influencers in this market segment, all of which are places with a highly likelihood of potential
customers participating. These efforts will also focus on social media platforms, since it’s another place
where target customers tend to interact with each other and other networks.
Personal selling will be our secondary marketing activity, given that Newborn Stories wants to personally
meet its potential clients face to face, for a coffee to discuss the client’s project, budget and other
details, so that we can further customize and enhance the positive experience that other photography
services are deficient on. Again, these potential clients will be reached through social media and the
online website using specific tools to find them and give them an incentive to contact us for more
details.
Primary Marketing Activity: Advertising
Social media platforms such as Facebook, Instagram, Twitter and Pinterest are the main marketing
platforms that will be used to promote and advertise our services as well as to interact with our
customers. The company’s website is another key touch point that will help drive in customers if it’s
optimally setup (SEO: search engine optimization), so as to be in the top of the list when searched in
platforms like Google.
Also, to carry out these events accordingly, a calendar of special events and occasions will be developed
in advance of each year to program activities, posts, and promotion ads. A social media manager might
be required to carry out these tasks previously mentioned as well as responding to customer questions
or complaints. The metrics provided by these websites and other tools will help measure our progress
and fine-tune our marketing efforts to attract more customers and generate positive feedback.
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Secondary Marketing Activity: Personal Selling
Social media tools are again another essential tool to precisely find the type of customer we need and
market to that segment. Commonly, couples expecting a newborn or just gave birth to the newborn,
will publish photos online in Instagram or announce it on twitter to their friends using hashtags such as
“#torontobaby”, or following pregnancy groups on Facebook like “Toronto Mommies”. This allows us to
target users with public profiles that specifically posted using any of these criteria and it can also be
limited to certain geography, ex. Downtown/ Mississauga. Posting on social media will be implemented
at least 3 times per week to keep us on top of mind and active online, which will also improve our
website’s ranking on Google’s search engine.
Another important priority is customer service, so after each sale we contact them through one of our
channels to follow-up on them, and ideally each customer will fill out a short survey to rate our service
and spot which areas need improvement, as well as keeping a record of their newborn’s date of birth for
example so that we can customize a letter or email congratulating them on the babies first year or some
other special event.
Supporting Marketing Activity: Public Relations
Networking to make new contacts in the industry is vital for the business to gain more awareness, so
attending events and keeping in touch with key influencers is crucial to growing the business. Social
listening shall be a routine of the social media manager, to be aware of any negative feedback or
publicity that can harm our image, and that require immediate action. And for that, some social media
tools will be implemented such as Hootsuite.
Supporting Marketing Activity: Sales Promotion
Sales promotions will solely be offered in special occasions as a means of incentive to capture new
customers, past customer and also to take market share from our competitors in the area. These
promotions will be mainly advertised online, but a few will be placed on coupons inside brochures at
hospitals and clinics in the maternity section and other places, so that we can collect this data and track
where it’s being most effective.
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Implementation
Date Action Details Cost Person Responsible
Target Completion Date
Resources Required
13/03/17 Outsourcing Consolidate social media platforms & website design, populate it with initial content.
25% Web designer 27/03/17 Media content (photographs and written content, ex. Price list.)
19/03/17 Research Research events and opportunities to meet with prospects.
5% Enmanuel C.
21/03/17 Online search in local event sites.
- /03/17 Networking Gather prospect list in events and through other networks.
5% Enmanuel C. *to be determined
Transport, business cards.
02/04/17 Research & Networking
Research & contact local key influencers in this business market and establish a relationship.
5% Enmanuel & social media manager.
16/04/17 Online research tools for social media: ex. Buzzsumo.com
09/04/17 Social Media Design & establish a content calendar for the year to post on social media platforms.
35% Enmanuel & Social media manager.
23/04/17 Research important dates that the target customer cares about and relevant content to post on those days.
30/04/17 Launch Campaign
Launch brand awareness campaign simultaneously in all social media platforms and have the key influencers mention you on their social networks.
20% Enmanuel & Social media manager.
14/05/17 Media content
-/05/17 Follow up Reach out to first customers and ask for feedback on the services.
5% Enmanuel & Social media manager.
*to be determined
Customer list Feedback questions
Marketing Budget total
*This 100% represents 10-15% of the initial capital investment
100%
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EVALUATION
The evaluation of the effectiveness of the campaign will be based on two main metrics, both
quantitative and qualitative. The first is the most the reliable metric because it will be based on actual
numbers derived from the number of sales we managed to get, the number of customers we reached
out to contact, and the amount of money we had to spend to implement each step of planned tasks.
These numbers will derive both from our internal data and external data. The external component will
be very critical to measuring our success since most of the marketing efforts will be based on social
media and online. Some online analytical tools provide tracking of this data and online customer
behaviour with reports, which will provide very useful insight to improve our practices on a constant
basis. Secondly, the quantitative data gathered to evaluate our performance would be the customer
feedback to measure their satisfaction and what aspects we can improve upon to drive their satisfaction
higher in the future and for the rest of the customers.
CONTROL
To measure our success with the marketing plan implementation we need to go back to our marketing
objectives and measure our performance based on them and if the company is being profitable while
doing so. We will also benchmark our performance with that of competitors in the industry so as to
measure our success and further improve our offerings to our target market while achieving more
efficiency and profit.
3.5. Marketing Objectives
Short-Term:
To establish a partnership with one or several charities by the second quarter of Dec. 2017.
To receive and provide proper customer service training to all members in the business.
Ensure that all touch-points in the business add value to customer’s experience.
To establish a partnership (contract agreement) with Hospitals and clinics as part of an exchange
program of printed photographic work to decorate the walls for promoting our services.
Long-Term:
To establish long term customer relationships through the use of structured packages that provides
our services in different stages of the newborn’s growth.
To be in the top of mind of customers when they need to refer someone for this type of services.
Be in the public eye and gain awareness through public relations with key influencers.
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4. Operations
4.1. Location
Newborn Stories’ initially will be a home based business given that the cost of renting a studio space
Downtown Toronto is quite expensive and we first need to test the market to ensure a progressive and
healthy growth cycle. So at first, a small office area will be assigned both for office work which involves
desktop work on a computer mainly for editing the photographs taken for the client, and secondly, it’s a
space attributed for the indoor photo studio setup with lights, backdrop, seating for the clients and
dressing area.
Newborn Stories assumes that this home studio will have a higher frequency of clients during winter
seasons since the weather impacts significantly the ease of doing outdoor photography with the clients,
and a lower frequency during summer because of the increase in outdoors photo sessions.
Fig. 1: Floor plan of Home Photo Studio Area of 27m2
(4.5mx6m)
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The basic setup of the studio lighting for subjects is shown in Figure 2 to better illustrate the spatial
requirements of the setup, and because the backdrop is not fixed to the wall, it gives the flexibility to
accommodate different demands so several variations of the floor plan can exist.
Fig. 2: "Home Studio Setup: 6 Things Every Photographer Needs". TechRadar. N. p., 2014. Web. 19 July 2016.
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4.2. Initial Capital Expenditures
A. Opening Inventory
Item Units Cost Markup Total Description
Gift Wood Boxes
#1
25
$12.80
$15
$320
Given to the client as a gift containing the
USB drive with the photographs. Dimensions:
L: 3.75" x W: 4.125" x H: 1.625"
(see fig. 3)
Gift Wood Boxes
#2
25
$33.80
$40
$845
Given to the client as a gift containing the
USB drive with the photographs + 10 4x6
photographs. Dimensions:
L: 7.00" x W: 7.00" x H: 2.125"
(see fig. 4)
Branded
Wooden
USB drive
(4GB)
25
$17.70
$20
$442
Given to the client containing the digital
photographs.
Total $1607
Fig. 3 Gift Wood Box #1 Fig. 4 Gift Wood Box #2
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B. Major Equipment Purchases
Equipment Units Cost/Unit Description Owned
Camera #1
1 $1780* Canon 6D. Professional Full Frame Camera
used as Backup camera. *Body Only
Yes
Camera #2
1 $3100 Canon Mark 5D III Professional Full Frame
Camera used as Main camera. *Body Only
No
Backdrop Kit
1 $150 Provides a clean background of coloured
choice.
No
Camera Lens #1 1 $450 Canon 50 mm f1.4 Yes
Camera Lens #2 1 $1110 Canon 100mm f2.8 Macro No
Camera Lens #3 1 $2630 Canon 70-200mm f2.8L No
Strobes 3 $120 Studio Lights No
Umbrellas 2 $40 Studio lights accessory to bounce light. No
Soft boxes 2 $50 Studio lights accessory to soften the light. No
Reflector 1 $40 Used to reflect light on to the subject. Yes
Flash Units 2 $250 Off-camera flashes for versatile lighten
indoors/outdoors.
Yes
Light Stands 3 $30 To support the studio lights No
Light Meter 1 $200 Sekonic Light meter, crucial for measuring
the light on the subject, speeds up work
flow and accurate results.
No
Heavy Duty
Equipment Carrier
Kit
2 $200 Nanuk Hard cases, to safely store and
transport equipment outside the studio.
No
Desktop
Computer
1 $2500 An up to day computer rig with high
specifications to render work faster.
No
Car 1 $217/monthly 3yr lease, Toyota 2016 iM ($19,665). For
transport to outdoor locations and clients
outside the GTA
No
TOTAL $13,710
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4.3. Legal and Insurance
Legal:
Newborn Stories Photography Studio falls under the NAICS code: 541920 – Photographic Services
“This Canadian industry comprises establishments primarily engaged in providing still, video or
computer photography services, including the video taping of special events. These establishments may
specialize in a particular field of photography, such as aerial photography, commercial and industrial
photography, portrait photography and special event photography.”1
Provincial Permits required to register the business in Ontario:
Service Ontario name search (cost varies $8-$26)
Master Business License ($60)
Registration of a Sole Proprietorship/General Partnership Form ($80)
Federal Permits required to register the business:
Federal Business Registration
Zoning By-laws:
900.41.10 Exceptions for ON Zone
(11) Exception ON 11
The lands, or a portion thereof as noted below, are subject to the following Site Specific Provisions, Prevailing By-laws and Prevailing Sections.
Site Specific Provisions:
(A) On the lands subject to this exception one or both of the following uses are permitted:
(i) a private residence; and
(ii) a catering business for individuals or groups who have made reservations, such as for dinners, wedding receptions, and banquets, but not for casual trade; and
(B) A photography studio is also permitted as an ancillary use to a catering business, if a minimum of 1 parking space rate is provided for every 4.6 square metres of floor area, including outdoor dining area devoted to patron
use.2
1 "NAICS 2012 - 541920 - Photographic Services - Canadian Industry".Www23.statcan.gc.ca. N. p., 2012. Web. 21 July 2016.
2 "City Of Toronto Zoning By-Law 569-2013, As Amended (Office Consolidation)". Toronto.ca. N. p., 2016. Web. 21 July 2016.
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Insurance:
Photography Equipment Insurance ($15 monthly)
Commercial Automobile insurance ($160 monthly)
Tenant Insurance ($25 monthly)
General Liability Insurance ($50 monthly)
Disability Insurance ($25 monthly)
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4.4. Human Resources
Newborn Stories Organizational Chart:
Fig. 6 Third year Organizational Chart Fig. 5 First year Organizational Chart
First year shows the need for a part time assistant when working with newborn children, because it
requires a lot of physical interaction with the baby during the shoot while the photographer takes the
photographs and also assists with the lighting and other duties like editing the photographs (Fig. 5). By
the third year, all the secondary functions like social media, designing and editing can be subcontracted
and outsourced to keep up with the growing demand and work load, and also to be able to provide
customers a better services by having a more integrated team of individuals expert in their field (Fig. 6).
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4.5. Process / Production
Typically the orders from the clients will be placed from the online website through a booking system,
through telephone call or personally after meeting the client. To proceed, the client must pay 30% of the
total cost in advance to book the date so as to guarantee the commitment for the service; this amount is
non-refundable. The booking can be placed at any given date as long as it’s not the same day or if it’s
already taken by another client. This way we can ensure that we have the capacity and time to provide
the proper service, since Newborn Stories will be mainly operated by Enmanuel Cardozo as the main
photographer and a part-time assistant on the first year. The amounts of photoshoots per day are
limited to three - 2hr sessions with a frequency of 5 times a week since 2 days of work are taken to edit
the material or personal purposes. This represents a maximum amount of 60 photoshoots per month.
The inventory necessary to deliver the packaged product for the client will be ordered through a reliable
source that can deliver the packages in 5 business days, and in case of failure, we will always keep in
stock a certain amount of packages to meet the projected demand, as well as a secondary distributor in
case of failure. Lastly, the business would require point of sale for customers who would like to pay with
credit card, especially those who want to purchase the higher cost packages, although we encourage our
clients to pay with cash to lower the costs on credit sales fees and reduce the accounts payable.
4.6. Risk Assessment
Marketing
Marketing to our specific target market through social media is a challenge and it requires some testing
to find the most suitable spot and criteria. So depending on how responsive they are to our online
marketing, we will quickly readjust our method so that we get better engagement and conversion rates.
Operations
The most crucial aspect that can affect our deadlines would be due to equipment failure and over
booking on a given day. To prevent the first we will keep a back camera and lights as secondary
alternative, as well as a backup of the client’s files on both a hard disk and online Drobox account.
Finance
Again, equipment failure or any other unexpected event can increase our current expenses, but in any
case, lowering the owner’s withdrawals and advertising expenses would be the first to reduce the
expenses if a negative cash flow is breached.
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5. Finance
5.1. Start-Up Costs
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5.2. Sales Forecast
The main assumption is that sales will be seasonal, with most of the sales volume taking place during
summer time because of the favourable weather conditions and during fall. During winter time the sales
will be significantly lower, so because of this, most of our marketing investment will be done prior to
those seasons to make any promotions available to clients with time.
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5.3. Cash Flow
30
31
5.4. Income Statement
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5.5. Break Even Analysis
Newborn Stories would require 589 photoshoots to breakeven, and according to the sales
forecast, this number is reached on the second year of operation around the second trimester.
The breakeven point was calculated as follows:
Overhead Costs for the 2nd Year
Owner Salary $60,000
Employee/contractor wages $24,000
Legal fees $1,200
Accounting services $9,500
Advertising and promotion $15,300
Commercial Rent $24,000
Property taxes/TMI $2,400
Utilities $4,800
Business Insurance $3,000
Telephone & Internet $1,800
Alarm System $600
Subscriptions & Memberships $700
Total $147,300
Average Price of Service: $400
Average Cost of Service: $150
Break Even Calculation: $147,300 / ($400 - $150) = $147,300 / $250 = 589 Photoshoots
5.6. Capital Requirements
The Capital Requirements necessary for Newborn Stories would be approximately $137,500. The Capital
Requirements was calculated as follows:
CR = Start-up Costs + Operating Requirements (Year 1) - Owners Assets Available for Investment
CR = $20,280 + $120,000 - $2,800 = $137,480
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Resources
NAICS 2012 - 541920 - Photographic services - Canadian industry. (2012). Statistics Canada. Retrieved 1 July 2016, from
http://www23.statcan.gc.ca/imdb/p3VD.pl?Function=getVD&TVD=118464&CVD=118471&CPV=541920&CST=01012012&CLV=
5&MLV=5
Report for: NAICS 541920 - Photographic Services - Financial Performance Data. (2016). Goverment of Canada. Industries and
Business.. Retrieved 25 July 2016, from https://www.ic.gc.ca/app/sme-pme/bnchmrkngtl/rprt-flw.pub?execution=e1s5
Statistics Canada: Canada's national statistical agency. (2016). Statcan. Retrieved 14 July 2016, from
http://www.statcan.gc.ca/eng/start
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Appendices
35
I. Industry Canada, NAICS “Definition of the Sector”
36
II. Industry Canada, SME Benchmarking
37
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III. Statistics Canada