routines associated with the cultures of equipped with bidet fixtures for cleaning
their home countries (India, Europe, parts with water. There is a niche market of
of Asia, etc.). Thor Bidet Inc. has identified approximately 1.5 million students that are
approximately \ in the US from these regions that face this
issue with an additional influx of
Bidet in the first year and grow it to 65,457 approximately 350,000 new students each
units by the end of the second year. The year (IIE). These students live in rented
cost structure is variable because the properties or college dorms where they
companys core competency is in cannot legally customize the bathroom
identifying the opportunity, directing the faucets to their liking and thus find
designing of the products, marketing, and themselves in a conundrum. Thor Bidet will
co-ordination with the vendors and alleviate this pain for the individual, by
customers. Thor Bidet Inc. has outsourced providing a semi-portable bidet which can
the manufacturing and warehousing. be filled using a standard tap in a
Furthermore, Thor Bidet Inc. bathroom. By conducting primary market
research the company has identified
convenience of use, high pressure, water
team consist of five individuals: two from
quantity, and price as the critical factors.
India and one from Pakistan, Kosovo, and
Thor bidet exceeds its competition in each
the United States. Each brings with them a
of these aspects and has been engineered
diverse breadth of cultural and experiential
to spray with enough pressure that will
learnings being from unique backgrounds.
enable the user to complete the cleansing
All members are business students, with
process satisfactorily and without unfitting
two of them specializing in
use of their hands. The Thor Bidet also
entrepreneurship and marketing, one in
provides the customer feeling completely
entrepreneurship and sustainability, one in
hygienic and, therefore, more confident.
supply chain analytics and one in finance &
analytics.
1.1 THE PRODUCT
The concept was discovered when the team
had to come up with a potential viable The Thor Bidet is a semi-portable bidet
business idea for their capstone project. system with a handheld sprayer that
The founding members explored their provides highly pressurized water through
personal pains they faced, and honed in to a flat fan jet nozzle that will optimize the
the concept at hand when they realized use of water by creating a triangular spray
that four of them face the same pain, being pattern mimicking the jet sprays used in a
an international student in the United carwash. This will make less water achieve
States. the same cleanliness results as other
nozzles that spray out streams. The
According to PewResearch, there are purpose of the bidet is to give the
approximately 2.5 billion people in the consumer the feeling of being clean and
world, for whom the norm is to use a bidet hygienic. Thus, they can go about their
or other water source to cleanse after a days in complete comfort and with the
visit to the restroom. The reason for using utmost confidence.
water is both cultural and religious. These
individuals face tremendous discomfort The primary user for the Thor Bidet are
when they travel to parts of the world individuals from the 55 countries listed in
where the norm is to use toilet paper, since
Page | 1
Exhibit B, where it is customary to clean organizations can be used to target
with water due to religious practices potential customers. As the Thor Bidet has
(Muslims & Hindus) or habitual routines high emotional value, word of mouth
associated with the cultures of their home plays a crucial role in sales conversions,
countries (India, Europe, parts of Asia, as new students tend to ask the older
etc.). Using toilet paper as an alternative students for guidance.
does not give this market the same
satisfaction as they get when they use For the B2B channel, Thor Bidet Inc. is
water. When these individuals travel to confident that the selected institutions will
areas where the norm is to use toilet be inclined to bulk purchase bidets to give
paper they find themselves in a to their incoming batch of international
predicament and experience discomfort. students, easing the students transition
Our target market is these into the US. The companys research
individuals/students that have recently shows that the universities are actively
arrived and are feeling the pain of the involved in trying to make the transition
change in cultural norms. Currently Thor of international students as comfortable
Bidet Inc. is focusing towards two bidet and as smooth as possible.
systems; the Thor Bidet and the Poseidon
Bidet. The Thor Bidet is designed to be
used in home toilets as a semi-portable In the third year, the brand would have
bidet, with a handheld sprayer system, established a reasonable presence
while the Poseidon Bidet will be compact amongst its customers; Therefore, the
and portable, which individuals can company plans to expand its marketing
conveniently carry in their school bags, efforts to all international students in the
briefcases, or large handbags whenever US who fit Thor Bidets segment and
they leave home. concurrently will be launching its second
product called the Poseidon Bidet.
3|Page
& Gamble, Georgia-Pacific, Svenska Although there are largely reputed brands
Cellulosa Aktiebolaget and other private already in the toilet paper industry, the
label manufactures all capturing a portable bidet market lacks a widely
significant share of the market considered go-to product. As such, it
(IBISWorld). would be crucial to establish a sustainable
brand that is associated with customer
service focus, hygiene, performance, and
2.4 KEY TRENDS reliability.
The most important trend is the average Considering the privacy effect of the Thor
9% increase of the number of Bidet, buyer behavior will only be
international students coming to United dependent upon personal choices of each
States. If we look at the international person. Many of them will be hesitant to
students coming from Hindi and Muslim even discuss their choices or use of this
backgrounds alone, there has been an product with their peers, therefore it is
increase of 53% during the last 5 years, imperative that the company targets
with 2016 lately recording an 11% them at personalized stores such as
increase from the previous year. In Indian Bazaar. Most new international
accordance to the last 5 years average, students tend to be hesitant of the large,
this market is expected to grow at an American markets at first, preferring to
annual rate of 9% for the upcoming years. stick to their cultural practices and
products, visiting imported foods shops
that are small and convenient for many of
Another positive trend can be found in the them.
size of the Hindu and Muslim population
currently residing in US already, which
corresponds to 3.3 million Muslims and In order to determine the buyer behavior
2.3 million Hindus according to of this particular target market, shopping
PewResearch3, projected to grow at a rate habits must be observed, especially in
of 2.1% and 1.2%, respectively. terms of products and locations. To save
Additionally, the overall 5.6 million on large amounts of capital required to
population with such background is build inventory needed to supply the large
5|Page
markets, Thor Bidet Inc. will be targeting This product is the cheapest bidet on the
small imported foods shops, major market and the one with the least amount
airports, and online ads specified at of pressure being created as well. This is
upcoming international students from due to the fact that the pressure is
targeted countries. created by the hand squeeze force. The
positives is that its low cost and has high
portability. The disadvantage is that it
3.4 MARKET SEGMENTATION & does not remove the need for the use of
TARGETING ones hand and thus does not ensure
convenience nor complete hygiene.
Market segmentation will be strict and Additionally, the water storage of this unit
narrow, considering that this product is is quite small and thus its usually not
only viable for people with a specific adequate for a wash and leaves the user
background, that are to live in US. dissatisfied.
Students with Hindi and Islamic
backgrounds will be the primary niche,
alongside other countries that use bidets
or at least water culturally and
Bio Bidet Electric:
traditionally. There are also other
segments that might be worth small
percentages of the total sales as this Like the Blue Bidet, this product is quite
product might fulfill a need that they similar in its size and portability but the
didnt recognize before. major difference is the fact that it has an
electric motor that runs on battery and
the pump push water out. However, due
Thor Bidets target market will be
to the small size of the pump and battery,
incoming international students that are
the pressure is again lacking and the user
not used to restrooms without a bidet.
has to use their hands to complete the
They will be 18-35 years old, will be
process. Further, the water storage is
looking at trends and online social media,
small and inadequate. Finally, this unit is
will be reluctant to adapt to the restroom
not an affordable option for the typical
culture in United States, and will have the
college student.
initiative to change for a reasonable price.
6|Page
Deliver
Online &
Speciality Grocery
the most important ones, which,
y Stores Online Online Online Stores according to market research, are
Warran
ties 1 Year 1 Month 1 year 1 year None
convenience and pressure strength.
Water
Capacit 500
y 2 Litre 500 Ml Ml 1 Litre 1 Litre Therefore, the Thor Bidet will primarily be
Portabi
lity Medium High High Low High
used at home and will not be geared
Pressu Very toward portability. However, the
re High Low Low Medium Low
companys research and assessment will
be immediately shifted towards the
3.6 ESTIMATED MARKET SHARE launching of the second product, the
Poseidon Bidet, after careful evaluation of
what features the target market values
Identified international students coming the most. As part of an ongoing Research
from countries where water is the medium & Development process, Thor Bidet Inc.
of cleansing are the primary target will be evaluating the exact features and
market. During the first year, Thor Bidet possibilities of a new, smaller and
Inc. will be only targeting the 25 portable product that customers will be
universities with the largest share of able to take with them to school, work,
students from target countries, which etc. Another objective of the Research &
translates to 52,894 students during Development will be to determine where
2016. The company expects to penetrate the company can save in terms of cost
60% of this market, thus equaling a and size and which features are most
market capture of 31,736 students during important to potential customers.
the first year.
8|Page
Overall, this economic model is strong and YouTube, which are the digital platforms
attractive since high profits will be that Thor Bidet Inc. will use for advertising
generated through high margins and high purposes. Thor Bidet Inc. will be engaging
sales volumes. the services of Happa Studios (a design
studio based in Lahore, Pakistan) to
design the brands image and create the
4.7 PROFIT DURABILITY required branding materials that will be
The profit stream will be vulnerable during used to create a uniform brand presence.
the first two years since Thor Bidet Inc. is Further, Thor Bidet Inc. will utilize the
selling only a single product. However, online social media content management
having a complete solution to the platform, $99 Social, to ensure a
intensity of pain faced by the many uniform social media presence; Sales
customers and the launch of the Poseidon representatives who are responsible for
Bidet in the third year will make the profit marketing and selling the product to
stream more solid. The market lead time select college institutions; Select retail
will be less since Thor Bidet Inc. is stores that focus on selling international
collaborating with Amazon. This will also products originating from the home
increase the customer service levels. countries of the target market; and a PR
campaign in correlation with the Hindu
So, the overall profit durability will be holiday, Holi.
strong. This is also supported by the fact
that there is less competitive risk as Thor Bidet Inc. will be sold on Amazon and
bidets are not the primary product used in retail stores. However, Amazon will be
for the cleansing process in the US. responsible for fulfilling the orders of
individual online customers and
institutional/wholesale sales. As the
5 MARKETING PLAN online company website offers information
about the product and the most
convenient place to purchase the product
5.1 OVERALL MARKETING based on the customers location, orders
STRATEGY cannot be placed on the website.
Thor Bidet Inc.s overall marketing goal is Additionally, wholesale orders from stores
to gain market share of international and college institutions will be placed
college students and college institutions, through sales representatives, who will
retaining customer loyalty to Thor Bidet provide them with a promo code(s) that
Inc. in future bidet purchases. Thor Bidet will be used during checkout on Amazon
Inc.s goal is to communicate the in order to fulfill the
message that its product offers superior institutional/wholesale order(s). The retail
quality, at a competitive price and price of the Thor Bidet is $36.99, while the
provides customers with a strong sense of Poseidon
relief, satisfaction, and confidence.
ertisement). According to market
Thor Bidet Inc. proposes to promote the research, the cost per click is $0.36. As
product through the following means: Thor Bidet Inc.s primary market research
Thor Bidet Inc.s company website, which shows, 75% of potential customers are
advertises the product(s) and informs interested in a high pressure semi-
customers how to use the product(s) and portable bidet, 58% are dissatisfied with
where the product(s) can be purchased; the current alternative, and 62% are
Facebook, Instagram, Snapchat, and willing to pay $31 or more. With a
9|Page
discount factor of 20% in the first two the company vast publicity, not only
years and 70% in year three onwards (due through a viral video, but also on a
to increased brand awareness), Thor Bidet smaller scale, for example around
Inc. calculated the conversion rate of colleges, in school and city newspapers,
Facebook advertisements for the Thor and brief segments on local news
Bidet to be 5% in years one and two and channels. Thor Bidet Inc. will also place
19% in year three onwards. With slight advertisements in school newspapers in
changes to the formula, Thor Bidet Inc. another attempt to meet its target
calculated the conversion rate for the market. Thor Bidet will expand its Holi
Poseidon Bidet to be 20% (Exhibit C). campaign to more universities each year.
12 | P a g e
As CMO, Mr. Piroli will be responsible for 7.3 BOARD OF ADVISORS
advertisement, marketing plan, and sales The founders have selected a diverse and
of the product. established group composing of experts in
what they have identifies as the major
Sales Representatives: Two full-time fields to bring the concept and company
employees during Year 1 and Year 2, four forward.
full-time employees in Year 3
Business Advisor: Ken Walsleben
Mr. Piroli will also be supervising the two
sales representatives that are responsible Mr. Walsleben boasts 30+ years in
for completing deals with target managerial and executive positions,
institutions and helping market the brand mostly in the business world. Lately, Mr.
and its Thor Bidet product initially. Once Walsleben has been working as a
the second product, the Poseidon Bidet is professor of Entrepreneurial Practice,
launched, Mr. Piroli will be supervising the making him a perfect addition that will
additional two sales representatives that help guide the team on how to approach
the company plans to hire. the launch of the product as well as
developing the business side of the
7.2 MANAGEMENT SALARIES & company towards reaching long and short
term sales goals.
OWNERSHIP
Each of the five founders have agreed to Operations Advisor: Raza Khan
begin with a 20% ownership of the
company. However, as equity is given in
Mr. Khan has been working in managerial
return for investments or other occasions
and executive operations positions for
as agreed by the majority of the founders,
over 16 years, most recently serving as
the ownership percentage will shrink
Chief Operating Officer of Taavun Ltd in
equally for each of the founders, in
Pakistan. Mr. Khan will be using his
accordance with the amount of equity
experience and expertise in the
given.
operational side of the business to guide
the team towards reaching operational
Modest annual compensation of $40,000 and supply chain efficiency.
will be established for all employees of
the company, including the key
Product Development Advisor: Harini
executives and sales representatives, until
Tatnis
the point where the company has broken
even and is sustainably profitable, at
which point there will be a re-evaluation Ms. Tatnis is a certified Scrum Master and
of the salaries and bonuses toward an certified Scrum Product Owner with
increase as well as having the dividends substantial experience in leading offshore
paid at the end of the year after breaking and onshore development teams,
even. There shall be a partnership including quality assurance lead
agreement that will establish the expertise. Ms. Tatnis will be advising the
compensation, percentage increase of team on product development goals,
salaries, and dividends percentage strategies, and helping with the planned
including stock options if it is decided for outsourcing of the product manufacturing
the company to go public in the future. to China.
13 | P a g e
In addition to the three advisory board stores. Additionally, Thor Bidet Inc. will
members, the team will also be continue with the marketing strategy, and
establishing a professional relationship send/receive/analyze customer feedback.
with a legal advisor, who will be giving
guidance with regards to the legal issues, Thor Bidet Inc. will break even in January
trademark, copyright, and other Terms of 2018. Further in 2018, Thor Bidet Inc. will
Service and contracts that the company begin expanding to more retail locations
will be needing. and more university organizations. Thor
Bidet Inc. will ramp up marketing in the
months of September and January, the
8 OVERALL SCHEDULE months in which its target market goes
back to college. Thor Bidet Inc. will begin
its Holi Campaign in March 2018, with
8.1 SCHEDULE SUMMARY plans to increase the campaign each
Thor Bidet Inc.s Overall Schedule details March to follow.
the first two years of design,
development, marketing, and operations, From 2019-2012, Thor Bidet Inc. will
while showing a brief growth schedule in continue strong sales and marketing on
years 3-5. As seen in the Overall Schedule the east coast, while exploring growth
table below, Thor Bidet Inc. will opportunities both through retail stores
incorporate in May 2017 as a C Corp and and through expansion across the entire
will begin leasing office and warehouse US. In year three, Thor Bidet Inc. will
space. Furthermore, two sales launch the Poseidon Bidet and hire two
representatives will be hired in the month more sales representatives in an effort to
of May. Thor Bidet Inc. will start the expand retail and institutional sales. In
design, development, and testing process 2020 and 2021, Thor Bidet Inc. will
in May and finish this process by June continue researching and developing new,
30th. At that point, the final version of the related products and continue with the
Thor Bidet will be created and the first sales and marketing strategy. Finally, in
order will be placed with the manufacturer year 2021, Thor Bidet Inc. will complete
in July. By August, Thor Bidet Inc.s the development plans for new products
website will be completed and Thor Bidet and explore expansion opportunities into
will be available for sale on Amazon and Europe.
in select retail stores. As Thor Bidet Inc.
will receive the first order from the
Year 1: 2017
manufacturer in the end of July, the
May Incorporation of the
official operation of the business will
commence and the marketing initiative venture as C Corp in
will be launched August 1st. By Delaware
September, Thor Bidet Inc. will ramp up Begin office and
marketing efforts, while the sales warehouse lease
representatives will contact and meet with Create first prototype of
international student organizations at the Thor Bidet
universities all across the north east in Initial plans sent to
efforts to promote and sell the Thor Bidet. manufacturer for design of
From September through December, Thor product
Bidet Inc. will continue its sales through Hire website designer
individual purchases on Amazon, select Hire 2 sales
university organizations, and select retail representatives
14 | P a g e
Develop overall marketing October Continue individual-online,
strategy retail, and university sales
Develop distribution Continue marketing
strategy (Amazon) strategy
Provide founders Begin to analyze customer
investment of $100,000 feedback forms
Seek $200,000 investment Novemb Respond based on
Hire corporate marketing er customer feedback forms
agency to provide uniform Continue individual-online,
advertising content across retail, and university sales
platforms (Happa Studios) Continue marketing
Hire social media creative strategy
agency to manage social Decemb Continue individual-online,
media platforms ($99 er retail, and university
Social) Continue marketing
June Design, develop, and strategy
testing of product is
completed
Website is finished
Sales representatives Year 2: 2018
meet with university
Q1 Breakeven in January 2018
institutions and select
retail stores Continue individual-online,
July Place first Thor Bidet order retail, and university sales
with manufacturer (orders Ramp up Facebook advertising
continue on a monthly in January
basis) Launch Holi campaign in March
Start official operation of Extend marketing strategy to hit
business all with target religious customs
Enter select retail stores Explore expansion into more
Begin POS marketing retail stores
strategy (retail stores) Q2 Expand college/religious market
August Begin Facebook to entire east coast
advertising Enhance online marketing
Begin individual-online, strategy through targeted
retail, and university sales display advertisements
Intense marketing geared Prepare operations for peak
toward international season
students going back to Q3 Ramp up Facebook advertising
school in September
Septemb Continue individual-online, Continue sales and collect
er retail, and university sales customer feedback
Ramp up marketing efforts
(Facebook Ads) Q4 Continue sales in university and
Create feedback forms to online channels
send customers Continue marketing strategy
15 | P a g e
come to US for studies next year - 37% of
Years 3-5: 2019-2021 which, according to market research, have
Year 3- Continue strong sales on been identified as potential target market.
2019 east coast for Thor However, in order to have more effective
Hire 2 more sales and cost-efficient initial marketing, the
representatives company will be targeting only the top 25
Patent the Poseidon Bidet universities during the first two years. Out
of the narrowed market, surveys showed
Place first Poseidon Bidet
that only 62% of the target market are
order with manufacturer
willing to purchase the product at $37.
Launch the Poseidon Bidet The company will also be assuming that
Begin expansion to entire during the first year of operations, only
US for Thor and Poseidon half of that market will be reachable. By
Enter more retail stores the third year, the company expects to
Launch Holi campaign increase its revenues through the launch
(increase from previous of another product, the Poseidon Bidet,
year) which will cater to the needs of
Continue expansion into international students and professionals.
retail stores It will bear aesthetic features and will be
Continue R&D geared toward portable usage.
Year 4- Continue sales throughout
2020 US Due to a limited budget and the fact that
Enter more retail stores the company will strictly be serving as a
connecting party between the outsourced
Launch Holi Campaign in
production and outsourced distribution,
March Thor Bidet Inc. assumes that the team will
Expand team as needed remain small for the first few years. In
Continue R&D addition to the three external advisors,
Year 5- Continue sales throughout five of the founders will also be working
2021 US full time in respective departments, as
Enter more retail stores well as two sales representatives in years
Launch Holi Campaign in one and two, with the addition of two
March more in year three.
Complete development
plans for new products The cost of the unit has been projected by
Explore expansion taking into consideration the material
opportunity into Europe parts used to complete the product and
the costs of outsourced manufacturing in
India. In average, the cost is expected to
be at $8.56 for the Thor Bidet and $6.46
for the portable bidet that is planned to go
9 CRITICAL RISKS & on sale in the companys third year of
ASSUMPTIONS operation. Inventory holding and
distribution will be outsourced to Amazon
and the costs have been projected to
9.1 ASSUMPTIONS $2.41 per unit. Product margins are
To compute forecast revenues, the expected to be $28.43 (77.0%) and
company will be taking the total number $11.53 (64%) for the Thor Bidet and the
of international students expected to Poseidon Bidet, respectively.
16 | P a g e
No capital expenditures are expected, and Operational Risk:
rent is expected to be at about $4,500 a
month, due to the projections that most Thor Bidet Inc. projects its design and
sales will be done online or through manufacturing costs to be $8.56 for the
institutions, thus having no need to have Thor Bidet and $6.46 for the Poseidon
a central location. Though Thor Bidet Inc. Bidet. However, there is a risk that these
will not patent the Thor Bidet, the costs will be greater than expected. In
company will apply for a design and utility addition, since Thor Bidet Inc. is
patent for the Poseidon Bidet in year 2. outsourcing its manufacturing to China,
there is a risk that the product is not up to
standard quality, due to lack of oversight,
9.2 RISKS which could severely tarnish the brands
Demand Risk: image. Further, since production will take
place in China, there is a risk of late
Thor Bidet Inc. recognizes potential risks shipments of the product.
in the market. Specifically, there is a risk
that demand will not be as high as To mitigate these risks, Thor Bidet Inc.s
expected; therefore, sales will be lower CIO will oversee production in China,
than projected. As the Thor Bidet Inc. is ensuring costs are kept low and product
targeting international students, if this quality is up to par. Thor Bidet Inc. will
population decreases in the near future, also keep safety stock of inventory in case
the company may miss its sales a problem arises in manufacturing or
projections. Furthermore, if Thor Bidet shipment, causing shipments to be
Inc.s marketing strategy fails to reach the delayed. The first order placed with the
target market, sales may be lower than manufacturer will contain excess bidets to
expected. Finally, the possibility of less diminish this risk.
sales poses the inherent risk of running
out of cash.
Lack of Patent Risk:
Thor Bidet Inc. will mitigate these risks in
As Thor Bidet Inc. does not currently have
several ways. First, through market
a patent, competitors can easily imitate
research, Thor Bidet Inc. has ensured that
the product itself. This is a critical risk that
there is a need for this product among
Thor Bidet Inc. will mitigate in the
international college students, specifically.
following ways: By offering a quality
In fact, not only does this market currently
product and an easy, convenient buying
exist, it is also estimated to grow at 9% in
experience that helps to retain customers;
the coming years. In addition, Thor Bidet
By quickly building brand awareness
Inc.s marketing strategy will reach the
through an aggressive marketing
majority of the target market, while its
strategy; By pricing the product lower
pricing strategy offers the quality product
than competitors; By producing new,
at an affordable price, particularly to the
innovative products based on market
target demographic, compared to the
needs.
price of similar products sold by industry
competitors. Finally, Thor Bidet Inc. will
keep costs low by bootstrapping and
using low-cost materials in manufacturing
to produce a quality product, raise more
capital if needed, and execute an
aggressive marketing strategy.
17 | P a g e
10 FINANCIAL PLAN potential target for the Thor Bidet of 2% in
the first year that builds to 9.6% by the
fifth year. Since the Poseidon Bidet has a
10.1 HIGHLIGHTS larger market potential, the company has
created a conservative estimate of first
Thor Bidet Inc.s financial plan offers a
year sales potential of 1.5% and plans to
great business value for investors. The
achieve 2.73% by the end of the third
companys revenue will start in August
year of sales.
2017 through the sales of the Thor Bidet
(Exhibit H). During the first year of
operations, the company would have net 10.3 COST CONTROLS
loss of $6,307.48 dollars. The companys Thor Bidet Inc.s CEO and CFO will be
second product, the Poseidon Bidet will be responsible to run the cost controls and to
introduced in the first quarter of the third manage the expenses of the company. If
year. needed, the marketing team will help for
the sales projections and the expansion
The company needs an investment of plan. Initially monthly reports will be
$200,000 apart from the owners generated to track the progress of the
investment of $100,000 in the first year. company. It will be the responsibility of all
The company has a negative cash from the founders to identify and mitigate risks
operations ($17,598) in the first year. The when needed.
burn rate of the company is 136 months.
However, the cash flow of operations
starts getting positive from Q2 of year 1 10.4 KEY FINANCIAL ASSUMPTIONS
(Exhibit I). The companys current ratio The company has accounted for sales
and quick ratio stands above the industry return and allowance which is assumed to
median suggesting that the company will be 3% of the revenues. Also, the company
be able to manage the short-term has kept a 15% operational expense
liabilities. The inventory ratio is on the buffer that will help mitigate the risks of
higher side, which suggests that the extra expense if required. Thor Bidet Inc.s
company will be able to sell the inventory major expenses will be purchases,
in fewer number of days. The profit marketing, and research and
margin of the company is between development. Apart from these, a major
18.88% and 30.94% from year 2 onwards. expense would be startup costs which
The return on equity has an exponential would be incurred in the first year. The
increase from 115.78% in year 2 to company will breakeven in 9 months. The
749.67% in year 5. net income after taxes will become
positive in the second quarter of year 2.
One benefit that investors will find
10.2 BREAKEVEN attractive is that the company is debt free
During the initial phase, the founders and most of the assets are liquid.
money will be invested and used to
bootstrap and start the business. The For now, to keep the financial statements
company will breakeven at 28,843 units in simple, the company has assumed that it
9 months (Exhibit E). The total market will pay the manufacturer and get paid by
potential for the Thor Bidet is 1.3 million retail stores and Amazon in the same
buyers, while the total market potential month. Thor Bidet Inc. has seasonal cash
for the Poseidon Bidet is 4.6 million flow sensitivity with respect to sales in the
buyers in their respective launch years. first and fourth quarters of the financial
The company has calculated a sales year. The company plans to keep the
18 | P a g e
salaries of the employees constant until Works Cited:
its financial goals are met.
1-
https://www.statista.com/statistics/268136
10.5 COMPANY OFFERING /top-15-countries-based-on-number-of-
Thor Bidet Inc. is seeking an investment of facebook-users/
$200,000 from investors in return for 14%
equity. The investor will also get voting 2-
rights and seat on the board. The NPV of https://www.salesforcemarketingcloud.co
the company is $1,474,829.59 using DCF m/wp-content/uploads/2013/06/The-
valuation technique (Exhibit K). The Facebook-Ads-Benchmark-Report.pdf
company also considered risk adjustment,
market risk premium and long term 3 - http://www.pewresearch.org/fact-
growth rate resulting to a discount rate of tank/2016/01/06/a-new-estimate-of-
40.80%. After analyzing the financial the-u-s-muslim-population/ft_16-01-
needs, the company plans to use the 05_numbermuslims/
money from angel investors for
marketing, initial purchase orders and 4 https://www.iie.org/Research-and-
R&D over a term of five years. The Insights/Open-
company has used cash safety cushion in
Doors/Data/International-
terms of 15% operating buffer. The
investment is expected to be made
Students/Leading-Institutions/2015-16
available during the starting months of
the business to achieve optimal growth 5
and manage sales. The company will https://www.census.gov/econ/isp/samp
buyout the investors for $1,000,000, or 5x ler.php?
their initial investment, at the end of year naicscode=322291&naicslevel=6
five. The preferred exit strategy would be
through acquisition from a major player of
sanitary toilet products. In the case of a
potential acquisition, Thor Bidet Inc. will
ensure a good fit, which benefits both
parties.
19 | P a g e
Exhibit A: Market Research
Q. How satisfied do you feel with your current method of cleaning? Q. Would you be interested in a high pressure water bidet that
provides effective cleaning without the use of hands?
Q. How much are you willing to shell out for a pressure based water Q. What do you think will matter when using bidet? (Choose one or
bidet (inclusive of 1yr warranty)? more)
Contribution Margin:
Breakeven: