Executive Summary
A1. Business Identification
A1 IT Consulting is an information technology consulting firm located in Atlanta, GA. The company is in the process of being formed as a limited liability company (LLC). The company is owned and fully funded by the family of Richard Dean.
A2. Mission
The mission of A1 consulting is to provide high quality and affordable information technology services to all computer users in Atlanta and its surrounding.
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A3. Business Goals
The main goal of the A1 consulting is to have a maximum customer satisfaction with the IT services that we provide to our customers. One aspect of the company’s mission is to provide high-quality information technology consulting services. In order to achieve this mission, the company will measure customer satisfaction and use the results improve the quality of production.
The business also aims to provide affordable services while maintaining our profit margin. Another aspect of the company’s mission is to provide affordable services to its customers. In order to achieve this mission, the company targets to provide cost-effective services which are affordable to the customers and profitable to the company as well.
A4. Keys to Success
Hire the highest quality and most experienced workers at competitive wages. The hiring of high-quality candidates will ensure that the business achieves its objectives of providing quality services as well as making profits.
Providing high-quality services at competitive prices. Providing high-quality services is essential in ensuring that the demand for our products is high at competitive prices which will increase revenue flow.
Improve customer experience. We are determined to improve customer loyalty by ensuring that all the customers’ concerns are addressed.
Company Summary
B1. Industry History
IT consulting industry originated in the 1980s when the personal computers emerged in the mass marketplace ( Pettersson, 2018 ). Since then, information technology has experienced continuous growth due to the evolution of the internet and social media over the years. Reports indicated that over 4 million people were employed in the computer and mathematical occupation in 2005 ( Edwards, 2014 ). Some of the fields with a concentration of employment in computer and math industry include data processing, peripheral equipment manufacturing, computer systems design, software designs, and other information services. A research study by IBISWorld reveals that the information technology industry in the United States is approximately $376 billion ( Edwards, 2014 ).
According to the study, information technology consulting businesses across the States is estimated to be over 433,000, which employs over 2 million people. 25 percent of the total IT consulting industry revenue is attributed to application design development and integration services ( Edwards, 2014 ). Most businesses, especially small and, medium-sized companies, usually hire IT, consultants, to assist in the creation and development of custom software as well as fine-tuning the existing software and hardware applications to help the companies enhance their business operations ( Pettersson, 2018 ).
There are various services offered in the information technology consulting industry today including planning and designing integrated software, hardware, and communication infrastructure, developing, testing, and supporting custom software, improving clients’ network security, and advising the clients on the appropriate IT services ( Pettersson, 2018 ). IT consultants can be hired by the client from IT consulting firm, while others work on site with clients managing the company’s computer systems and data processing facilities. The general consulting firms today in the United Stets include Accenture, Deloitte Consulting LLP, IBM Global Services, PricewaterhouseCoopers Advisory Services LLC, McKinsey & Company, Oracle Consulting, Cisco Systems Inc. SAP Services, and many others. The information technology industry is one of the industries in the United States which still offers various investments opportunities for IT consulting firms due to the continuous growth of the sophisticated technology, internet connectivity, and social media ubiquity ( Pettersson, 2018 ).
B2. Legal Form
The consulting firm will start as a Limited Liability Company. Being a start-up business registering it as a limited liability company (LLC) is important due to the flexibility of the LLC structure. This is a form of private limited company which combines the features of partnership, or sole proprietorship with those of limited liability of a corporation. The limited liability company legal form provides the owners of the company with limited liability in many jurisdictions. The LLC provides the business owner with flexibility depending on different circumstances. For instance, the business may choose to use corporate tax rules instead of treated as a partnership, or the business can sometimes be organized as a not-for-profit organization. This kind of flexibility helps the business operate in various circumstances. This type of legal form is also important for businesses owned by a single owner.
B3. Location and Facilities
The business will be located in a small office to start. The business location will expand ion future when the business grows. The starting office will have two rooms; a workspace and conference room. The workspace will contain computers, telephones, help desk, reception area, office furniture, and few workers. The computers will be used to design and develop software, and other information technology services. The clients will communicate to the business helpdesk via telephone lines. Also, the receptionist will receive the clients and refer him/her to the responsible persons. The conference room will be mainly used for business meetings, seminars, and training, demonstration of a new product, public address, customer meetings, and briefings. The conference room is mainly equipped with presentation materials such as projectors, writing boards, microphones, speakers, and many others. Because it is a start-up business with a small office space, the business will only acquire few items for the startup. These include 4-5 computers, a telephone, few types of furniture, and basic presentation materials.
The business will be located in the main city of Atlanta in an open place where it will be easily recognized by the clients. There will be an advertising board on top of the office’s roof so that it can be spotted easily. The business located will be sited in an open place near roadside where it will be easily accessible by the clients by foot, bikes, or car.
The business will also acquire all the necessary legal documents in order to meet Atlanta City’s legal requirements for starting a business. These legal documents include operating licenses, work permits, and occupancy permit. In order to comply with authorities, the business licenses and occupancy permits will be placed on the walls of the primary office as required.
B4. Management Structure
The business management structure consists of the owner, human resource, manager, marketing manager, operations manager, IT operators and consultants, a lawyer, accountant, and contractor employees. The business owner provides the vision and direction of the business, develops and refines processes and procedures, and creates the business human resource structure. The human resource manager will be responsible for management of employee activities in the business, worker’s welfare, and recruitment and training of workers.
The marketing manager’s main tasks include marketing of the business products, advertising, designing marketing strategies, and developing appropriate pricing strategies. The operations manager will control the whole process of consulting activities such as the design of new software, provision of network activities, among others. The business will also need an accountant to manage its financial records such as balance sheets, statement of income, statement of cash flows, budgeting, and revenue collection. The business lawyer will be responsible for managing legal issues associated with the business operations. There will also be field operators and contract employees responsible for providing IT consultancy services in the clients’ firms and other institutions.
B5. Products and Services
The main products and services that will be offered by this IT consulting firm include hardware and software installation, data processing, computer systems design, software designs, application design development, and integration services. The business consists of a team of hardworking IT professionals who are experienced in the field of IT consultancy. The business provides quality services in software and hardware installations, software development and designs, computer systems designs and integration services. We help our clients achieve efficiency in their operation when using IT services. The business is determined to help companies and institutions to continue operating swiftly in this era of technological advancements.
Market Analysis
C1. Target Market
The main target market of this business is any company that is implementing new hardware upgrades, an institution implementing new IT projects, a company which needs a new software design, and entities where computers are widely used. The priority target in the market would be home office businesses, small businesses, and medium businesses. Home office businesses are small office businesses which are located at the owner’s home. Home office businesses differ from the simple home computer users.
Home office businesses, small businesses, and medium business is the main target for this business because these type of businesses usually lack software designers for developing and designing new software, IT assistants to install new hardware and software systems, and project manager to facilitate new IT projects. Therefore, this area offers great opportunities for business to business type of consulting. Also, the target businesses will be all male and female business owners within Atlanta, Ga and its surroundings with an income of $500,000 and above regardless of education level, and marital or family status.
C2. Industry Analysis
Market Trend
The market trend for the IT consulting within the home office businesses and small business is at skyrocketing increase ( Pettersson, 2018 ). The high growth rate in the IT consulting market is attributed to the proliferation of the internet and broadband connections, advancing technology, social media ubiquity, increase in online trade, teleconferencing among others. Computers are today widely used in research, education, e-commerce, internet purchases, online bill paying, personal financial management, entertainment among other various activities. Between the years 2003 and 2007, the average growth of PC users has been 2% for home PC users and 3% for small business contracts which translates to an average of 2.29% ( Pettersson, 2018 ).
Market Growth
A study conducted on a sample of the population in Eugene community reveals that in 1999, there were 27.8% of home PC users while in 2003, the percentage grew to 71%. During the same period, the percentage of internet users increased from 14% to 64%. There was also an increase of 39% of computer users within the business during the same period. The increase in computer usage was attributed to technological improvements, reduction in computer prices as well as a decrease in complexities ( Pettersson, 2018 ).
C3. SWOT Analysis
The four-square table below shows the key strengths of the business, its weaknesses, opportunities, and strengths it is facing.
S (Strengths) 1. The business has a comprehensive knowledge of the industry. The business is well informed of the market trends in the IT consulting industry, areas of opportunities, and customers’ preference. This put the company in a strong position to gain a competitive advantage over competitors in the industry. 2. It has the ability to demonstrate technical knowledge to non-technical clients. This expertise enables the company to offer quality consulting services to clients with little technical knowledge thus increasing customer preference. 3. Flexibility. The business is flexible in terms of services offered which enable it to meet customers’ needs through the provision of customized and flexible IT solutions | W (Weaknesses) 1. As a start-up business, the number of clients the business is able to serve is limited. It still lacks the resources to offer services to a large number of customers. 2. The business still lacks the ability to develop/create brand equity (at least initially) which makes it difficult to compete with, more experienced competitors. 3. The business is currently unable to scale rapidly to meet the rising demand. It will take some time to achieve this fete. |
O (Opportunities) 1. The company has ventured in a growing industry. This gives it an opportunity to grow in its operations. 2. The business also has increased product sales opportunities due to the rapidly rising computer usage. 3. There has been a decrease in the market share for large consulting companies. This presents the business with the opportunities to gain market network. | T (Threats) 1. The first major threat is a possibility of future competitions from other consulting firms. 2. Computers are also becoming less complicated thus reducing reliance on IT consulting firms. 3. There is also a significant increase in customers’ knowledge of computer technology which also reduces reliance on IT consultants. |
D. Market Strategy
D1. Marketing Mix
The marketing mix of the A1 IT consulting business is the market strategies will use to gain a competitive advantage in the market. These key strategies include pricing strategy, promotion strategy, place strategy, and product strategy.
Pricing Strategy
Pricing is an important factor in the marketing mix. In a perfect market, there exists price-demand elasticity. The presence of price-demand elasticity implies that an increase in the price of products is associated with a decrease in demand for the product, and vice versa. Therefore, the pricing factor is a sensitive component that this business will treat with utmost care. A1 Consulting business will adopt an entry pricing strategy rather than price matching strategy to gain market grounds. This strategy will increase the demand for our products due to lower prices. The company will consider changing to price matching strategy later on after gaining a significant market share. The services will be priced as hourly rate pricing, retainer pricing, and project pricing. Also, the company will be involved in strategies such as bundling and discount strategies to increase sales of their products.
Promotion Strategy
The business will prioritize on four main product promotion strategies including advertising, networks and referrals, web-based promotion, and sales force. The business will use the most efficient media with wide audience coverage to advertise its products. These channels of advertising include social media platforms such as Facebook, Instagram, and Twitter. Also, the company will advertise via televisions, radios, and other media services. The networks and referral strategy will involve using the already established client to create a larger network of potential clients. The business will utilize web page to showcase its products.
Place Strategy
A1 IT consulting firm will position itself as the premier information technology consulting firm in Atlanta. This business will distribute services to home-based offices and small businesses across the Atlanta area. It will provide contacts to its customers in case they need assistance. The company will also offer web-based consulting, telephone consulting, and media consulting. This will help deal with cases of emergency.
Product Strategy
The firm will adopt a value-based product strategy. The business will be flexible in its operations in order to offer quality services which are desired by customers. The main goal of this business is to achieve customer satisfaction. This strategy will build an everlasting relationship between the business and customers.
D2. Price List
ABC Pricing | |
Consulting | Price |
| Hourly rate Consulting | $75.00 |
| Retainer Consulting | $150.00 |
| Project Consulting | $600.00 |
The average price charged per hour for consulting is $75.00, the retainer consulting price was based on expected minimum number of hours per month, while project consulting price was based on hourly rate (8hours a day).
D3. Promotion Strategy
| Task | Completion Date | Responsible Party |
| Create and Print Brochures for Consulting | 2-Dec | Marketing Manager |
| Create and Print Business Cards | 2-Dec | Marketing Manager |
| Set up a meeting with the event center to discuss partnership | 7-Dec | Owner |
| Join Local Chamber of Commerce in Atlanta | 11-Dec | Owner |
| Add introductory promotion to the homepage of website | 17-Dec | Marketing Manager |
| Create Social Media Accounts (Facebook, Twitter, and Instagram) | 17-Dec | Marketing Manager |
| Add Company Signage to the Website | 24-Dec | Marketing Manager |
| Register for the Local Events | 31-Dec | Owner |
D4 . Sales Forecast
Explanation of Monthly Sales Forecast Year 1
A1 Consulting firm total sales are expected to grow throughout the first year of entry. This is because the company used entry pricing strategy when it entered the market. Its prices are relatively lower as compared to competitors hence increasing demand as well as revenues.
Market Condition
The current IT consulting market is growing rapidly due to the increase in computer usage, internet connectivity, and technological improvements. Thus, the demand is growing for the IT consulting services. This is reflected in the increase in sales throughout the year in the sales forecast.
E. Implementation Strategy
E1. Overall Implementation Strategy
The table below summarizes overall strategy that will be used to launch the business
| Implementation Strategy | ||
| Task | Completion Date | Responsible Party |
| Meet with Attorney to File Paperwork | 02-Dec | Lawyer |
| Obtain a Business License | 03-Dec | Owner |
| Open Business Checking Account | 04-Dec | Owner |
| Obtain Funding to Purchase Equipment | 10-Dec | Owner |
| Create Website | 12-Dec | Owner |
| Order Equipment for the Office | 13-Dec | Owner |
| Hire Manager | 14-Dec | Owner |
| Install Equipment at Office | 20-Dec | Owner |
| Order furniture for the office | 21-Dec | Owner |
| Join the Chamber of Commerce | 24-Dec | Owner |
| Hire Employees | 25-Dec | Owner |
| Train Employees | 26-Dec | Manager |
| Implement Promotion Plan | 29-Dec | Manager |
E2. Monitoring Plan
| Monitoring Plan | ||
| Task | Completion Date | Responsible Party |
| Initial plan and ongoing training will be implemented to ensure that employees understand the culture, goals, and objectives of the organization. | Monthly | Manager/Owner |
| Links to an online customer’s satisfaction survey will be included with every invoice. Results will be reviewed and responded to as needed, each week. | Weekly | Owner/Manager |
| Monitor online review sites such as YELP and respond to issues/ concerns. | Weekly | Owner/Manager |
| Review sales goals vs. actual, inventory controls, ordering, and overall expenses. | Quarterly | Owner/Manager |
| Staff meetings will be held to provide training, review, performance, discuss the schedule and upcoming promotions and address any general questions or issues. | Monthly | Owner/Manager |
| Owner and manager will meet quarterly to review current and upcoming promotions and discuss any new strategies that will be added to the marketing plan | Quarterly | Owner/Manager |
F. Financial Statements and Projections
F1. Income Statement
F2. Forecasted Balance Sheet
G. Financial Report
G1. Financial Projections
The company made profits throughout the first year of sales. The profits increased every month up to the year-end. A large percentage of the firm’s earnings were from the hourly consulting sales. This enables A1 consulting to take on future debts if needed. The Company made a profit of $ 44,955 which is the owner’s equity. The company’s total liabilities amount is $30,000 while total owners’ equity is $93,000 which implies the company is majorly funded by owners’ equity. A1’s current assets amount is greater than its current liabilities which show the company’s good financial health.
Some financial assumptions were made during the preparation of the balance sheet and statement of financial position It was assumed that rent cost was estimated based on average costs of similar buildings in the area. Also, the total operating expenses were estimated at about 40% of the total sales revenue. The estimation of utility costs is based on the average costs for other businesses of similar size in the building. The owners used $28,045 of the inherited family wealth for investment in the company.
G2. Financial Position
The firm ended the year with a profit of $44,955. This is because the average sales were high throughout the year while the company incurred less expense. This huge profit makes the company be in a better financial position.
G3. Estimated Investment Needs
The Owners of A1 Consulting had invested $48,045 of the inherited wealth for the initial startup of the Company to offset any long-term asset purchases as well as the cost associated with the establishing the consulting office. The company has no debt funding and will use this position in the second financial year to acquire long-term debt when it will expand its operations to several locations and add new employees. However, there is no need for capital at this present time.
References
Edwards, J. (2014). IT Consulting in the US. IBISWorld Inc, Los Angeles .
Pettersson, A. (2018). Surviving in a digital economy: A study of the consultant brokerage industry.
