Auditing and Consulting Business Plan

1.1 Mission

Artemide AC’s mission is simple and straightforward:

• Purpose – Artemide AC exists to provide complete, reliable and high quality services to SMBs, individuals, lawyers, and authorities. Services must give solutions and results!
• Vision – By providing innovative services, Artemide AC generates a name in Luzern and the surrounding area.

1.2 Keys to Success

The keys to success for Artemide AC are:

• Developing visibility to generate new business leads.
• Relationships with clients (developing loyal, respectful, and intensive contact with both clients and potential clients).
• Marketing/strategy and networking with other professionals.
• Collaboration with Daten Riffwald-Ennetmoos AG for generally fiduciary services and IT services.
• Responsiveness to clients (fast response time for special problems).
• Quality (especially in reporting information).
• Excellence in fulfilling the promise.
• Openness: languages and willpower for creating interregional and international contacts.

1.3 Objectives

The objectives of this business plan are:

1. To provide a written guide for managing this business; a strategic framework for developing a comprehensive tactical marketing philosophy.
2. This plan is not intended to obtain financing, it is purely for internal improvements.
3. The scope of this plan is to provide detailed monthly projections for the current plan year, as well as yearly summaries for the following two years.

The objectives of Artemide Auditing & Consulting are:

1. The overall objective is to focus the activities towards the specialized services (analyses, investigations, startups, etc.) and to become a leader in this niche in the Luzern area.
2. Cash flow – To generate sufficient cash flow to finance future growth and development, and to provide the resources needed to achieve the other objectives of the company and its owners.
3. Growth – To expand the business at a rate that is both challenging and manageable, serving the market with innovation and adaptability. (Growth projected at 10% of sales in the next three years.)

2.1 Company History

The sole proprietorship company “Sandor Artemide dipl. Wirtschaftsprüfer” was founded 8 March 1996. In the first 10-month period, the company generated sales of $50,000.

In the time of general recession, between 1996 and 2000, with a concentrated basis work, the owner created and assured his independent existence. The name Artemide was made known, and he has established a good professional reputation in Luzern.

Before starting his own business, Sandor Artemide acquired extensive professional experience as listed below:

• 5 years ATAG Graff & Altern in Geneva, Switzerland.
• 3 years Ziegfeld in Bern, Switzerland.
• 4 years KUGN in Bienne, Switzerland.

2.2 Company Ownership

Artemide Auditing & Consulting AG will be incorporated in the city of Luzern by Sandor Artemide, who will be the majority owner. Twenty-five percent of the company will be owned by Daten Riffwald-Ennetmoos AG, the parent company.

2.3 Company Locations and Facilities

Artemide AC is established in a separate office from Daten Riffwald-Ennetmoos AG, in Luzern. Secretary and telephone response is assumed by Daten Riffwald-Ennetmoos. In the same building, on the first level, is established ATO Geistesblitz (sale and consulting of SMB software sage-KHK).

The structure is well established and satisfies the needs of both Daten Riffwald-Ennetmoos and Artemide AC. Both companies intend to optimize the office location in the future.

3.1 Service Description

Artemide Auditing & Consulting AG offers three main services:

3.2 Competitive Comparison

There seems to be four major classes of competition in the actual fiduciary business in Switzerland:

1. Individual proprietors and small fiduciary and accounting offices. The primary business of these competitors is accounting and tax compliance (for individuals and companies). This offices normally employ between 1 and 5 people. These offices deal in a large spectrum on a general level, but without specialization. These offices are often members of the STV.
2. Medium fiduciary officeswith between 6 and 25 or more employees. These offices are also dealing in a large and general spectrum. If there are several partners–with different formation and specialties–these offices are available for general financial and tax consulting. This offices are member of the STV or/and the TK.
3. Large auditing and consulting companies. These companies have several hundred employees. They tend to operate more in the lucrative consulting business. Public companies are normally audited by these companies. Large companies are normally not interested in dealing with small and medium business. All large companies have an international network.
4. Banks, Assurances and other Financial Consultantsare new competitors. Financial services are “in.” Banks are active in start-up consulting, corporate finance, mergers and acquisitions, and others.

3.3 Fulfillment

The fulfillment of services was provided in the past by the owner himself. The ultimate delivery was the owner’s expertise and problem solving capability, coupled with an open mind and ease of communication. The end result is an established trust with complete customer confidence and satisfaction.

In the future, the clients must also accept the work of other qualified personnel–it is necessary to transfer and expand the established personal goodwill into company goodwill. This will only be possible with qualified and motivated employees.

3.4 Technology

Technology is, of course, very important to the success of Artemide Auditing & Cconsulting. It is imperative that the company stay up-to-date on the technological developments in the classic business software like MS-Office, etc. as well as in the special software and tools for auditing, financial planning, business planning, etc.

In addition, it will be important to devote a reasonable portion of each year’s revenues toward upgrading the equipment and software used by Artemide AC in its normal operations.

4.1 Market Segmentation

The following chart and table reflect the estimated market segmentation and growth for this business.

• Individual persons and Investors
• Small Businesses – Defined as businesses with 1 to 24 employees, this is the second largest and fastest growing segment in our region.
• Medium Businesses – 25 to 499 employees.
• Large Businesses – 500 or more employees.
• Authorities and Public Organizations

4.2 Target Market Segment Strategy

For our further development, we consider the following market segments to be very important:

• Individual persons and Investors.
• Small and Medium Businesses.

Artemide AC will focus its marketing strategy primarily on these market segments.

4.2.1 Market Needs

There are three different major opportunities (needs) in the fiduciary business over the next years:

• Financial-Planning
• Business-Planning
• Business-Evaluation
• Merger & Acquisition
• Startup-Planning
• Restructuring
• Business Succession-Planning
• Coaching in Financial-Managing
• Recovery
• Special Audits, Reviews
• Analyses
• Investigation, Forensic Services
• Other

1. Bookkeeping and other services related to the operative financial management (payroll, cost-accounting, accounting for pension funds, etc.).
2. Consulting and special mandates.
3. Legal Auditing (incl. IAS and other standards) as an independent and responsible institution.

We think that the need for consulting and other specialized fields has a strong growth potential.

4.2.2 Market Trends

Three primary market trends seem to be most important in our business:

• Trend 1-(most important)Rapid growth in complexity of business in an ever-changing market and competitive environment needs continuous and rapid adaptation in both strategy and structures of companies.
• Trend 2-(moderately important)In the future there will be a percentage of unsuccessful ventures resulting in more litigation, which, in turn, will emphasize the need for specialized audits, investigation, restructuring, etc.
• Trend 3-(least important)Predicted continued growth in consulting because companies will be unwilling to pay fixed costs of salaries, choosing instead to treat specialized financial knowledge and needs as variable costs from external sources.

Economically it is more expedient to acquire specialized services from a consulting firm that has its own specialized employees.

4.2.3 Market Growth

As noted in the previous section, several factors are predicted to continue well into the next decade, not the least of which we estimate the annual market growth rate between 5% and 10%.

4.3 Service Business Analysis

The fiduciary and consulting business for the local area is already well established, yet still allows ample opportunity for us. This is supported by the following points:

• Already in existence are a large number of firms – we think that most of the small and medium firms are operating in a limited spectrum of traditional fiduciary services (accounting and tax) and they do not have enough knowledge and/or time for entering the field of specialized services – so we have new participants like banks, assurances, lawyers, and others entering the market.
• Customers in the fiduciary business tend to be loyal, relying on the same consultant for future needs once a relationship has been established – this fact requires establishing a good and intensive personal relationship with client. This, in the large, “big 6,” firms, is often not realizable because of staff turn over and inaccessibility of personnel.
• The globalization of markets will increase the demands for expansion of new services related to our business.

We believe our business is in a in a period of grand change. The competitors must be generalists and specialists at the same time. For small and medium fiduciary businesses, a focus of one primary segment of business is necessary. For example, if the “core” business is accounting, the other fiduciary businesses like tax, auditing, consulting must be reduced to a general level. In the core business, the company must be current with the services, while having the capacity to innovate (like new accounting services related to the Internet).

For our business, we do not have main competitors: We have many competitors in diversified services. More important than the competitors, is the need to get established in the right market and to develop this market with a strong and flexible strategy.

4.3.1 Competition and Buying Patterns

Competition in the general field of business consulting in the Luzern area is quite intense. Although numerous established companies offer a variety of services to different customer segments, Artemide Auditing & Consulting AG considers competition in our focus market niche of small and medium businesses to be modest. Customers in this segment strongly rely on the consultant’s professional qualifications and the ability to come up with viable solutions in a time- and cost-effective manner.

5.1 Competitive Edge

Artemide Auditing & Consulting’s competitive edge is in the well-established reputation of Sandor Artemide who has been in the consulting business for over a decade. Combining his professional expertise with the financial, marketing, and technical support of Daten Riffwald-Ennetmoos AG, the company is positioned to further entrench itself in the growing market of small and medium business consulting in the Luzern area.

To develop good business strategies, perform a SWOT analysis of your business. It's easy with our free guide and template.Learn how to perform a SWOT analysis

5.2 Sales Strategy

The company’s sales strategy will be based on building long-term customer relationships, which will result in repeat sales. Customer service and ‘face time’ with clients will be aimed to maintain a high level of customer retention. The charts and table below outline the Sales Forecast for the next three years.

6.1 Personnel Plan

The following table outlines the two-person management system of Artemide AC.

7.1 Important Assumptions

This information is presented in the table below.

7.2 Key Financial Indicators

The Benchmark chart below uses index values to compare past and future financial indicators. The bars show relative change, not absolute values.

7.3 Break-even Analysis

With our average monthly fixed costs, Artemide will surpass break even consistently throughout the next year of operations.

7.4 Projected Profit and Loss

The projected profit and loss information is presented in the table and charts below.

7.5 Projected Cash Flow

The projected cash flow and cash balance information is presented in the chart and table below.

7.6 Projected Balance Sheet

The projected balance sheet information is presented in the table below.

7.7 Business Ratios

Business ratios for the years of this plan are shown below. Industry profile ratios based on the Standard Industrial Classification (SIC) code 8721.01 – Auditing services, are shown for comparison.