Business plan for a start up english training service center

TRƯỜNG ĐẠI HỌC MỞ TP HCM UNIVERSITE LIBRE DE BRUXELLES HO CHI MINH CITY OPEN UNIVERSITY SOLVAY BRUSSELS SCHOOL MBAVB3 NGÔ QUỐC PHONG BUSINESS PLAN FOR A START-UP ENGLISH TRAINING SERVICE CENTER MASTER PROJECT MASTER IN BUSINESS ADMINISTRATION (PART-TIME) Tutor’s name: Dr Trinh Thuy Anh Ho Chi Minh City (2011) i CERTIFICATION I hereby certify that I researched and wrote this thesis by myself All reference knowledge and information is fully indicated in the Reference chapter I also haven’t used this plan for other purposes than for the MBAVB3 thesis Ho Chi Minh City, 20 March, 2011 Ngo Quoc Phong ii ACKNOWLEDGEMENT This thesis can never come into being but for the help of many wonderful people who have made invaluable contribution First, I would like to thank my tutor, Dr Trinh Thuy Anh, who has guided me through all difficulties to complete this business plan My heartfelt thanks go to my mother and family, who have always stayed by my side to support and motivate me My sincere gratitude also goes to professors at Solvay Brussels School for terrific lessons on business, especially Professor Francois Faelli of Entrepreneurship and New Venture, who has inspired me into being an entrepreneur I will also never forget Professors at Royal Business School, HCMC, for their highly practical knowledge, lots of which is applied to this business plan Then I would like to show my gratitude to Ms Minh from Vietnam Investment Group, who has delivered a lot of market research information to save me plenty of valuable time, to Mr Tuyen, Marketing Manager, and Mr Tu, Finance Manager, at Cleverlearn English Language Center for providing useful documents which I used as benchmarks for my thesis This business plan is also, in no small part, due to my inspiring students and colleagues I must thank Ms Huong and Ms Ha, my friends and co-founders, who share my desire and belief, and really motivate me to finish this project Saving the best for last, I highly appreciate Mr Adam Khoo and his wonderful books, which have totally changed my mindset, inspired, given me strong belief and set a clear direction for my life and career iii TUTOR’S COMMENTS Mr Ngo Quoc Phong is highly interested and makes a lot of efforts in doing with a start – up English training service center, he also has strong expertise and experience in the field His research has got the requirement of the master project I suggest the jury allow him to defend this thesis Ho Chi Minh City, 20 March, 2011 Tutor’s Signature Dr TRINH THUY ANH iv Lodestar English Language School Business Plan March, 2011 v Table of contents Chapter 1: Executive summary .1 Chapter 2: Definition of the market Chapter 3: Business Description and Vision 13 Chapter 4: Description of Products and Services .22 Chapter 5: Organization and Management 25 Chapter 6: Marketing and Sales Strategy 30 Chapter 7: Financial Management 36 Chapter 8: Risk Management and Limitations 43 REFERENCES 45 APPENDICES 46 vi List of Exhibits Exhibit 1: Components of a business plan Exhibit 2: English Training Market Exhibit 3: BCG chart Exhibit 4: Porter’s Five Forces Exhibit 5: Comparison of some English schools .10 Exhibit 6: The Learning Pyramid 12 Exhibit 7: Corporate Envisioning Process .13 Exhibit 8: Consumers use search, experience and credence properties to evaluate services 21 Exhibit 9: Organization chart 25 Exhibit 10:Five dimensions of service quality 31 Exhibit 11:The E-marketing mix 34 Exhibit 12:Estimated revenue in the first year 42 Chapter 1: Executive Summary The Business plan is at the cross-roads of the team, the opportunity and the resources Exhibit 1: Components of a business plan I have been an English teacher and working at some of the biggest English schools like VUS, Elite and Cleverlearn for years I have learned a lot but I am still not happy and wondering what is the best way to teach English At these schools, they just teach the language and the same approach is applied to all students As a result, good and motivated students turn out good, and bad and de-motivated students end up being bad and de-motivated There seems to be no way out for these discouraged students I myself didn’t find an answer until years ago when my brother gave me one of his favorite books, “I am gifted, so are you” by Adam Khoo This book really enlightens me and changes my mindset about how to be happy and successful in life I now believe that any student can master English if they have a great desire, strong belief and right strategies to learn English Ngo Quoc Phong – MBAVB3 Then I talked with several of my so-called bad students and confirmed my belief Most of the time, the root cause was either their lack of desire, diffidence (partly due to discouraging comments by their teachers) and/or wrong strategies To help these students, I started to think of establishing my own school applying this new approach together with other cutting edge knowledge, my own experience and observation My teachers will not be teachers but coaches who set goals, action plans and motivate the students in a fun and competitive learning environment The ultimate goal is that the students will like English and be able to use the right tools (which other schools rarely care about) to teach themselves My mission is to help students build up their desire, belief and strategies in order to teach themselves English in a fun, effective and efficient way Later on I met Ms Ha, one of my teaching colleagues Interestingly she also shares my worry and interest She is even one step ahead of me by conducting a successful study skills program for students at her college Therefore she would be an excellent R&D Manager and make great contributions to the school The third and also last member of the management team is Ms Huong, a Marketing expert whom I met in a seminar at Royal Business School Although I am taking an MBA program, I still lack lots of realistic experience in marketing which is critical to success of a service business She would make a great Marketing Manager of the school The English training market is witnessing a great demand and growing very fast according to the Department of Education of HCMC However, students’ needs are not well satisfied, and they tend to jump from school to school to find the right one for them This is a great opportunity for us to meet these unsatisfied needs In this highly potential market, our school will focus on teaching General English to high school and university students and white collar workers in the middle class because this segment brings big profits and has the highest growth rate Our core competences would be a comprehensive and innovative methodology, strong marketing, culture and values, and a qualified team of 23 people All of these are valuable resources to create our competitive advantages Ngo Quoc Phong – MBAVB3 With a vision of becoming a household name in the field, our goals for the first year include a ROI of 40% and profitability of 10%, which turn out to be realistic and attainable based on our financial calculation In fact, if the school just operates at 50% of its capacity with 10 students per class, ROI will be 43%, profitability 13%, sales $629,000, EBIT $93,800 and profit $84,400 In conclusion, the opportunity is great, the team is strong and the resources are available So we are confident that we can make a successful business and contribute great values to the society Ngo Quoc Phong – MBAVB3 43 Chapter 8: Risk Management and Limitations I Risk Management Copy cats If this model is successful, other competitors may copy it To prevent this, first we need sound PR and branding strategies to promote and declare our possession of the methodology to the public We also need to improve ourselves so that the competitors always fall behind even though they want to copy us In other words, it is about constant innovation and building new advantages on top of old ones “The essence of strategy lies in creating tomorrow’s competitive advantages faster than competitors mimic the ones you possess today An organization’s capacity to improve existing skills and learn new ones is the most defensible competitive advantage of all.” — Gary Hamel and C K Prahalad That’s why constant improvement is one of our core values Resignation of key managers All founders play critical roles in the success of the business However, their belief and commitment are different As the CEO and business idea owner, I have the strongest belief and commitment to the school, so I need to keep their interest and persuade them into the potential and vision of the business I also need to make succession plans to make sure there are always people (besides me) to replace them when they are sick or even leave the company Exit Strategy In case the company has achieved its predetermined goals and the founder(s) has (have) lost interest in the business, or the company is facing constant loss, we may consider transferring it to existing managers (Management Buyout) or outside investors Ngo Quoc Phong – MBAVB3 44 The trigger point for exit consideration is ROI of – 40% a year or – 20% in years II Limitations Due to limited time and resources, I have just interviewed 10 target customers Although they all showed interest in the business concept, the core communication message and felt the price acceptable, we still need to a more thorough quantitative research to learn more about our customers’ needs, to see if they are really interested in the concept and to check the suitability of our marketing mix (e.g pricing) We also have to carry out a pilot project of teaching about 60 students to test and optimize our methodology Ngo Quoc Phong – MBAVB3 45 REFERENCES Adam Khoo (2006), I am gifted, so are you!, Marshall Cavendish Editions James C Cross and Bruce J Walker (1987), “Service Marketing and Franchising: A Practical Business Marriage”, Business Horizons, Indiana University Graduate School of Business, Volume 30 (6) Charlie Bentson King – writer and producer, “The Sid story” video, Training ABC Corporation – distributor Thành Quân Ức (2006), Tam @ quốc, NXB Tp HCM, Việt Nam Ngo Quoc Phong – MBAVB3 46 APPENDICES Appendix 1: My CV (CEO’s) PERSONAL Name : NGO QUOC PHONG Sex : male Date of birth : January 15, 1982 Address : 230/18/24 Truong Chinh, Ward 13, Tan Binh District, HCMC Mobile phone : 090 3388 065 Health : excellent Interests : sports, swimming, reading, listening to music, singing CAREER OBJECTIVE / To develop my career in an interesting and challenging environment with excellent promotion prospects EXPERIENCE December 2010 – present: Academic Manager, Royal Business School, HCMC Duties: Making training schedules, communicating with Professors, editing translated materials, interpreting and assisting professors in class, looking for appropriate trainers and making sure the professors are warmly welcomed, also interpreting for all foreign judges in the “Key to success - CEO” game-show broadcast on VTV1 at 9:30pm every Wednesday June 2009 – November 2010: Academic Coordinator, Translator, Interpreter, Royal Business School, HCMC Duties: Translating materials for mini-MBA courses, communicating with Professors, interpreting in class and doing other logistic tasks to make sure the program goes smoothly Ngo Quoc Phong – MBAVB3 47 The courses cover a wide range of subjects including soft skills, sales, management, marketing and finance February 2009 – June 2009: Translator-interpreter, Black & Veatch International Company Duties: Translating and interpreting for the Central Region Small and Medium Towns Development Project, Water Supply and Drainage components October 2008 – January 2009: Translator-interpreter, GTEK Information Technology Company Duties: Translating documents, contracts, proposals, and website; holding an English speaking club April 2008 – September 2008: Translator-interpreter, Khoi Nguyen Transport Trading JSC Duties: Compiling documents, translating and interpreting for the Canadian International Private School Project December 2006 – May 2010: English language teacher, Elite International English School Duties: Teaching English to adults from elementary level to TOEIC, TOEFL iBT October 2006 – October 2007: English language teacher, Vietnam Australia International School (VAS) Duties: Teaching English to children and teenagers from Kindergarten to Junior High school August 2004 – November 2008: English language teacher, Vietnam USA Society English Training Service Center (VUS-ETSC) Duties: Teaching English to children, teenagers and adults from elementary to intermediate levels Ngo Quoc Phong – MBAVB3 48 Part-time translator and interpreter for VCCI, TNS (a market research company) and other organizations EDUCATION / December 2008 – present: Taking a joint MBA course of HCMC Open University and Solvay Business School, l’Université Libre de Bruxelles, Belgium / August 2008: TOEFL iBT: 110/120 points / July 2004: BA degree in English Linguistics and Literature, University of Social Sciences and Humanities, HCMC QUALIFICATIONS / Good command of English language, translation and interpretation skills / Good communication and presentation skills / Thinking creatively / Ability to work hard, attentively and devotedly / Good skills at Microsoft Word, Excel and PowerPoint / Enquiring mind Ngo Quoc Phong – MBAVB3 49 Appendix 2: Ms Huong’s CV PERSONAL Name: PHAM THI XUAN HUONG D.O.B: Oct 7th 1972 Place of birth: Saigon Address: 217 Block D, Thanh Da, Binh Thanh District, HCMC E-mail: xhtoday@gmail.com Hand phone: 0908 205 220 CAREER OBJECTIVE Building on my experience in advertising and marketing to develop a career as an account member in a advertising / media agency or a marketing member in a trading company EDUCATION Hochiminh Economics University Diploma of Planning Faculty Bachelor Hochiminh Advertising Association Course Certificate of Advertising (Branding; PR; Account management; Creativity; Media planning) Institute of Applied Marketing Certificate of Brand building Course Institute of Applied Marketing Certificate of Professional Sales Supervisor Institute of Applied Marketing Certificate of Sales system Building Ngo Quoc Phong – MBAVB3 50 VJCC – Vietnam Japan Commercial Cooperation Certificate of Application of Customer oriented Marketing PACE Certificate of Accounting for leader Institute of Applied Marketing Certificate of Integrated Marketing planning Institute of Applied Marketing Certificate of Marketing Research PERSONAL STRENGTH ♦ Computer literate: Microsoft word, Power point, Excel ♦ Organizational and managerial mind ♦ Ability to work to tight schedule and independently ♦ Ability to work under pressure ♦ Well experienced in Marketing, Advertising, Media & Magazine publication ♦ Creative Dynamic RELEVANT EMPLOYMENT HISTORY Client Service Manager 1994-1999 MT Company Ltd The company is specialized in PR, event and direct Marketing Responsibilities: handling clients (finding new clients, consulting and planning Advertising activities) and widen market by create new products and services for company Ngo Quoc Phong – MBAVB3 51 Account Manager - PR & Event Organizer 1999-2002 GOLDSUN Advertising Agency The agency is full-service in Advertising Responsibilities: Consulting, planning and implementing client’s Marketing, Communication, Advertising and PR-event plan Brands: TCL electronics, Unif instant noodle, A-one instant noodle, Bibica, Enfagrow, MeadJohnson, Holcim… Traffic Manager 2002–2004 OGILVY & MATHER Advertising Agency The world-wide agency is full-service in Advertising Responsibilities: in charge of managing, operating working process In charge of work quality and manage work timing Managing and assigning people’s working to meet client’s plans Marketing Manager 2004 – 2006 VMAX The company is manufacturing compatible cartridges for printer Responsibilities: in charge of Marketing activities: planning for Brand building campaigns: PR, Event, Advertising, Sponsorship; and planning for Marketing campaigns: Trade Marketing, Direct Marketing, Product pricing, Marketing Strategy Magazine Director 2006 - 2008 CHU THI – SUC SONG MOI The company is specialized in Magazine publication and TV programe called Suc Song Moi Responsibilities: Manage all department of Magazine unit Handling 07 key brands of Unilever and write branded-editorials for these clients Ngo Quoc Phong – MBAVB3 52 Managing all Marketing and Distribution activities for Suc Song Moi magazine Marketing Manager NAMTRAN PHARMA 2008 – now The company is specialized in marketing and distributing imported (from France, Italy) pharmaceutical products, including: OTC medicine, functional food and treatment cosmetic Brands: Foltene, Younger, Vit-Hair, Domina (leading products in each segment) Responsibility: Develop and implement annual strategic marketing plans and strategic direction for – years plans Developing existing products & future potential products Conduct & analyze market research Manage & monitor all marketing programs, including both ATL and BTL activities Develop and manage Consultant, Website and Research team Relevant skills Customer service skill Analytical skill Researching skill Communication skill Dealing skill Problem-solving skill Writing & editing skill (Newspaper article, Advertising and Communication) Strategy planning skill Experiences gained Applying creative ideas Knowledge about media channels Wide and deep knowledge about advertising, event, PR Ngo Quoc Phong – MBAVB3 53 Knowledge about marketing, trade marketing Knowledge about branding Knowledge about magazine publication Work well in team environment REFERENCES: Mr Daniel Comar – Creative Director of Ogilvy & Mather Malaysia Email: danicomar@mac.com Mr Đinh Trung Chính – Creative Director of VAC (Đất Việt) Mobile: 0903 958 670 Ngo Quoc Phong – MBAVB3 54 Appendix 3: Ms Ha’s CV NGUYEN KIM HA Tel: (+ 84) 0983 633 369 -Email: hank@imc.edu.vn Education 2010- 2012 University of Applied Sciences- Northwestern Switzerland MBA- MCI ( In progress) (Management Consulting International) 2006-2007 Curtin University of Technology, Australia M.A in Applied Linguistics 2005- 2006 SEAMEO- RELC Vietnam- Singapore Diploma in TESOL 1994- 1999 University of Education, HCMC, Vietnam B.A in English Teaching Experience 2008- present : · Lecturer of Public Speaking (Applied Associate Science Program) at Saigon Institute of Technology, an affiliate of Houston Community College, Texas, the US · Lecturer/ Designer of Study Skills and Skills Development Program (PreUniversity Program) at Saigon Tech and IMC institute 2002- 2008 · English Instructor at Saigon Tech, teaching all language skills · English teacher at Vietnam USA Society- Appreciated as Best of the Best teacher for the exceptional teaching performance (2004) Ngo Quoc Phong – MBAVB3 55 · Math and Science English teacher in Vietnam Australia Society ( VAS) – recognized as Teacher of the Year ( continuously for years) 1999- 2002 · English teacher at Nguyen Cong Tru ( Go Vap District ) and Trung Phu (Cu Chi) high school · Graduated from Hotel and Management Department- Tourism Training School and started to work part time in De Nhat and Caravelle hotels Management Skills April 2010- Present · Dean of International Cooperation and Education- Information and Mass Communication of HCMC ( IMC Institute) · Management Consultant for IMC Institute - Lead the college in being responsive to challenges, opportunities, and requests from national and International related affiliates - Provide leadership in developing an academic vision and plan for the college and its programs and ensure continuing attention to the college’s vision - Responsible for the development of school programs and collaborates with the school chancellor, provost and Department Chairs - Serve as the Chief Operating Officer for the College with overall responsibility for instructional, research, and service programs; curriculum and program development; faculty and staff employment, development, and evaluation March 2008- April 2010: · English Education Consultant for SaigonTech Management Board - Worked with Management Board to propose innitiatives for the school's development - Encouraged faculty to explore new teaching methods and technology - Offered consultation, support and resources for instructional design - Initiated English training programs for staff (Engineering Department) - Provided academic consultancy to SaigonTech students Ngo Quoc Phong – MBAVB3 56 - Conducted English, Public Speaking and Study Skills Courses · Director of Studies ( English International Programs) - Designed and maintained a curriculum that reflects the students' intake, meet the needs of the students and fullfill the mission and vission of the school - Provided support and guidances to instructors and faculties to ensure that learning, assessing and teaching are constantly reviewed and developed in line with the school's mission - Recruited English teachers and provided teaching methodology training Additional Skills/ Participation in GloCALL 2007 Computer- Assisted Language Learning Conference Certificates “Strategic Management Consulting” Certificate from University of Applied SciencesNorthwestern Switzerland Certificate from Institute of Young Businessmen- Management for Middle Managers Proficient in Microsoft Office Suite, Windows 98/NT/XP/Vista and Power Point Presentations Organized, efficient, and possess good communication skills among fellow workers, clients and management Freelance writer for Tuoi Tre online/ newspaper Good at photography Awards received “ Best of the Best” teacher at Vietnam USA Society 2004) “Teacher of Distinction/ Teacher of the Year” 2004,2005,2006,2007 “ Exceptional Teaching Performance” awarded by University of Education 1999 Ngo Quoc Phong – MBAVB3 57 Reference Mr Tran Cong Tinh- IMC Chancellor tinhtc@yahoo.com Dr Nguyen Van Sau- SaigonTech Chancellor nguyen_vs@saigontech.edu.vn Gary Stremel- Dean of Business Administration Vice- President AHMG (American Hospital Management Group) garystremel@saigontech.edu.vn./ garystremel@gmail.com Le Thai My Phung- Director of Academic Affairs – VUS phungltm@vus.vn Stephen Gerard Coyle- Director of Embassy Education Development and Training Company sgcoyle13@yahoo.com Peter Goudge- Head Teacher in ESL- SaigonTech petergoudge@yahoo.com.au Appendix 4: English Centers Site Visit by VIG, 2010 (please see the attached file in the CD) Appendix 5: Competitors Evaluation by Cleverlearn, 2010 (please see the attached file in the CD) Ngo Quoc Phong – MBAVB3 ... franchising is a perfect match for Service Marketing (their article of Service Marketing and Franchising: A Practical Business Marriage” on Business Horizons magazine of Indiana University Graduate School... make and carry out a detailed marketing plan (see the marketing strategy below) and other preparation stuff In addition, we will also start making presentations at potential schools and companies... themselves English and no longer passively wait for their teachers Gradually they will establish a love for English and a habit of self-learning Righteous Business is for profit, but if a company spares