Accounting and Finance Firm Business Plan

Executive Summary

Future Profit is known for giving expertise in a wide array of areas for e.g. accounting, bookkeeping and financial based planning. The firm has a decent consumer base which has increased overtime, the firm’s main revenue streams are tax planning and providing businesses with guidelines in streamlining their own revenue streams.

The target market for the firm are the businesses which have employed 50 or more employees or businesses which earn 1 million dollars or more. Moreover, the businesses which are growth oriented or growing rapidly, and entrepreneurs who are looking towards business incubation. Furthermore, Future Profits is focused on exploring different revenue streams and in optimizing the firm for the future. Work processes will be improved in marketing tactics which would be used to create leverage for the firm, affecting its total capacity, giving it more traction in the market throughout the year.

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Future Profit provides people and businesses with both tangible and intangible value. The firm lays emphasis on creating minimum tax exposure towards the clients while keeping in view all of the state and federal laws. Every business operating within the market needs peace of mind, the firm goes on to exactly provide that to businesses while crunching their numbers having provided them with legal ways to use their financial resources in the most productive manner. The company makes complex situations for businesses into easily understandable situations, advising them which would allow them to have a better influence all the while optimizing their wealth. Through expansion in China the company will be able to expand its revenues in a sustainable manner.

Table of Contents

Executive Summary

1. Introduction

1.1. Internal Analysis

1.2 Factors affecting Accounting Industry

1.3 Business Model Canvas of Future Profits Pty Ltd.

2. Marketing Plan

2.1 Justification for Selecting Beijing

2.1.1 PESTLE Analysis

2.2.2 Porter Five Forces Accounting Industry Beijing

2.2 Entry Strategy for Future Profits Pty Ltd

2.3 Evaluation of Lease within Beijing

3. Operational Plan

3.1 Operational Analysis

3.2.1 Overall Cost Leadership

3.2.2 Lean Process Management

3.3 Employee Training

4. Financial Plan

4.1 Financial Inputs

4.2 Projected Profit and Loss Statement

References

1. Introduction

Future Profit Pty Ltd, is a company which has been established for 20 years in Canberra, it provides consultancy and accounting practice for SME’s.  It is a very well-known company locally and to some part nationally with a few client holdings internationally as well. The firm has gone on to make an impeccable reputation throughout Australia, especially the City of Canberra.

The current business plan explores external environment to select a new city where Future Profits Pty Ltd can expand in order to achieve sustainability and to evaluate business prospects that can be exploited by expanding the business. The report has prepared marketing plan, operational plan and financial plan to effectively explain how and why the company should optimize its function to capitalize on opportunities.

1.1. Internal Analysis

The company has a strong brand name and has a set of personalized clients with a modest revenue. The company has much opportunity to expand and involve many more companies improving its market share. The industry current market share is limited in comparison to its competitors however, the industry has a very focused target market where it only targets companies with $1 million revenues without much industry specifications. The industry is experiencing a major technology shift where automation is becoming a threat to accounting companies. Nevertheless, there is also an effective advantage if Future Profits Pty Ltd. is able to tap in the process they might be able to create a sustainable competitive advantage. Using TOWS analysis, a variant of SWOT strengths and weaknesses can be mapped against threats and opportunities to understand how company can capitalize in external market.

1.2 Factors affecting Accounting Industry

Burritt and Christ (2016) states industry 4.0 is bringing revolution within accounting industry as real time information and accurate processing of the data is critical. The big data and real time processing provide effective environmental information and it becomes critical in forecasting future trends where many companies can take effective decisions based on these trends (Vasarhelyi et al., 2015). Financial risk management is assisted where accounting data is utilized to ensure company is moving on sustainable patterns. Moreover, the blockchain technology is improving how the accountants detail asset ownership, there is a significant increase in transparency of accounting data and blockchain reduces the number or probability of the fraud a company can initiate (Dai and Vasarhelyi, 2017).

2. Marketing Plan

The capital city chosen for expansion is Beijing, it is one of the fastest growing cities with a well-developed in Chinese market. This region is strategically important as well because most of the companies internationalize to China.

2.1 Justification for Selecting Beijing

2.1.1 PESTLE Analysis

2.2.2 Porter Five Forces Accounting Industry Beijing

2.2 Entry Strategy for Future Profits Pty Ltd

The effective market entry strategy will be acquisition of a local accounting firm within Beijing which has a considerable market size captured to give Future Profits Pty Ltd a boost in the Chinese market and a kick start with some critical linkages within the industry. Acquisition strategy is also recommended by Anderson and Sutherland (2015) in which relates to a common process in China as acquisition provides significant boost within the Chinese economy.

2.3 Evaluation of Lease within Beijing

Lease properties are easily available however, they are costly in the dynamic market where growth prospects are really high. When space requirements change they would be bound by the contract to fulfill the lease payments (Keyhanian and Rabbani, 2015). However, when company cannot commit to purchase a property it is better to lease is out on a long term. Sharing Spaces come at the cost of extended leverage to make control of the area.  Since for Future Profits Pty Ltd. requires private space to deal with the clients it is recommended to undertake a lease contract of a suitable property and Chinese government demand local ownership which would make the process easier.

3. Operational Plan

3.1 Operational Analysis

The firm must go on to expand and diversify their services which would create stability in the longer run. In Beijing Future Profits will have access to many foreign companies hence localizing the services would be effective to offer legal optimization according to Chinese law. 

3.2 Improvement Strategies

3.2.1 Overall Cost Leadership

Implementing this strategy allows the firm to operate at a low-cost base, since the target consumer market for the firm is SME’s providing quality for lower cost can prove to be beneficial for Future Profits (Kharub et al., 2018). Giving accountancy and consultancy to different businesses at a lower cost can prove challenging but it is profitable too. The firm would go on to reduce costs in marketing servicing or by adopting a no frill approach within the actions and procedures being carried out by the firm.

3.2.2 Lean Process Management

The lean process management is all about reducing waste and optimizing the processes to improve the overall effectiveness of the system (Tasdemir and Gazo, 2018). The company make processes effective and transfer the value to the customers.

3.3 Employee Training

The field of accounting is constantly evolving, so it is important that people serving within this industry get comfortable with the change otherwise there is a risk of falling behind. There are different options present to the firm in order to train its employees to stay up to date, there is a blended approach which employs procedures like in house training, attendance at different conferences, taking webinars or indulging in online self-study (Tracey et al., 2015). Focus will be on skills like negotiation management, learning skills in automated technologies like cloud computing, big data, and blockchain.

4. Financial Plan

4.1 Financial Inputs

The financial projections show the projected revenues when the Future Profits starts operating within Beijing and above plan is for 3 years projects. The purpose of the plan is to understand the financial implications of the expansion to strategically decide if its is beneficial for the organization to expand.

References

• Anderson, J. and Sutherland, D. (2015) 'Entry mode and emerging market MNEs: An analysis of Chinese greenfield and acquisition FDI in the United States', Research in International Business and Finance, 35, pp. 88-103.
• Burritt, R. and Christ, K. (2016) 'Industry 4.0 and environmental accounting: a new revolution?', Asian Journal of Sustainability and Social Responsibility, 1(1), pp. 23-38
• Dai, J. and Vasarhelyi, M. A. (2017) 'Toward blockchain-based accounting and assurance', Journal of Information Systems, 31(3), pp. 5-21.
• Economics, T. (2020) China - Economic Indicators. Online: Trade Economics. Available at: https://tradingeconomics.com/china/indicators (Accessed: 13 January 2020).
• Keyhanian, S. and Rabbani, M. (2015) 'Revenue and turn–over based joint pricing and production planning for an integrated financial lease–sales system: a new mathematical model', International Journal of Operational Research, 22(3), pp. 310-341.
• Kharub, M., Mor, R. S. and Sharma, R. (2018) 'The relationship between cost leadership competitive strategy and firm performance', Journal of Manufacturing Technology Management.
• Tasdemir, C. and Gazo, R. (2018) 'A Systematic Literature Review for Better Understanding of Lean Driven Sustainability', Sustainability, 10(7), pp. 2544.
• Tracey, J. B., Hinkin, T. R., Tran, T. L. B., Emigh, T., Kingra, M., Taylor, J. and Thorek, D. (2015) 'A field study of new employee training programs: industry practices and strategic insights', Cornell Hospitality Quarterly, 56(4), pp. 345-354.
• Vasarhelyi, M. A., Kogan, A. and Tuttle, B. M. (2015) 'Big Data in accounting: An overview', Accounting Horizons, 29(2), pp. 381-396.
• Wu, X., Lu, Y., Xu, H., Lv, M., Hu, D., He, Z., Liu, L., Wang, Z. and Feng, Y. (2018) 'Challenges to improve the safety of dairy products in China', Trends in food science & technology, 76, pp. 6-14
• Yiming, W. U. and Siying, C. (2019) 'A Study on the Relations Between Chinese Government and Private Enterprises on the Course of Internationalization—A Case of Huajian Group', Advances in Social Sciences Research Journal, 6(2).