Proposal for creating a U.S branch

Introduction

Why expand? The company has an excellent reputation in shanghai. That opened doors for the business to become one of the major suppliers for many projects in theregion. Consequently, the company has outstanding brand in the sanitary industry that prepares it for broader markets out of China. There are many positive incentives for business expansion. For starters, the expansion will expose the company to a wider audience, seeing that it is already receiving a positive response to China. The higher number of potential customers will in return raise the amount of sales and profitability.

Another reason for an expansion must be an opportunity to staff the company with fresh and qualified people. Employees are the most critical asset to the business, and, therefore, new and talented personnel are a plus to the company expansion. The firm has five departments that are all looking into hiring new people. If the 20 new employees go through keen selection, then they will steer the company towards its objectives quicker than expected.

Expansion of the business will present us with the opportunity to relocate it. Some states in the United States offer tax incentives to companies that bring new adventures in the market area. Moreover, there will be an easier access to our suppliers and customers at large. Also, the new branch will allow cooperation with great local companies which will also help expand our client base. Expansion will enable us to hire local personnel with adequate knowledge of the market scope in the United States. The beginning might not be as easily done but time and determination towards achieving our goals is crucial. The new personnel, location, and market strategies will steer the company towards inevitable greatness.

U.S Market research analysis

Market research entails finding the right product, at the appropriate place, at the precise location and real time. The four parts of any market research include product information, place, price, and promotion. For us to be fruitful and profitable, we will work towards filling the gap in the market. Our aim is to stand out. We need to evaluate the area to relocate and potential customer base. Having a better understanding of our market is our priority. It also provides with a better understanding of our competitors. Use of the questionnaire also provides with the best information on the larger market. Since statistics changes, we plan to perform more research on different stages when the business sets sail.

The new market penetration will be hard. The forecast for the first three years is easy to predict. We expect the first year to consist of losses. It will be mostly more market research and building client base. The second year, we hope to break even, and profits can start to build up from the third year. We will take advantage of existing client base to develop the U.S market. We will attract specific clients based on our specialty strength. The present company in china already has relationships with many international customers. The clients include large construction contractors in China that will help expand our market into the U.S market base.

There are numerous markets for bathroom building materials already existing in the U.S market. The companies are high, providing excellent products. An example is the Hydrotect Company. The company produces ceramic tiles with titanium- dioxide that dissolves pollutants. They also implement antimicrobial metals to get rid of germs that cause mildew (Popular mechanics, 2014). It makes customers appreciate the product immediately.

Customer is king. Therefore, we set to investigate the needs of the clients in the U.S. it will guide us towards delivery to the market base. Our research looks into the safety of the end-user. It is beyond any doubt that tiles when used for bathroom prevent mold and protect the planet. Even in the shower, eco-friendly ceramics squares lock out moisture (Baker, 2008). The technique prevents water damage to cut on costs. In the light of this, our clients  want products that are economical and healthy to use at the same time. Our core objective is to deliver the kind of outputs that protect our clients both financially and physically.

Our company seeks to build large warehouses in the major cities along U.S west coast to develop small to mid-sized retailers. Therefore, we aim to provide an advantage regarding pricing of our products. To provide the customer with affordable and friendly prices, we will need to minimize the expenditure on our business delivery. Therefore, we shall need to identify cities that are most helpful to new businesses. In addition to the west coast region, we will identify other areas in the country that are best for business.

Firstly, the West coast has a very proximity to Asia; therefore, doing business with Asia is easier. Moreover, the time difference is not so diverse and so both places are mostly awake at the same time (Wonrov, 1989). Furthermore, most life changing companies are all based on the west coast.  Even in the past the strategic location of the West Coast to Asia has been used as an advantage (Velaigam, 2007).

Masco, a U.S company, wants to cooperate with our business. Our most significant objective is to connect our business with the right groups to drive our growth forward. Merging with the real companies will help us build even more admirable relationships with our customers and commercial providers. THE Masco Company is large enough with more than 20 companies and 60 manufacturing facilities in the U.S (Burden, 2007). The shares of the Delta faucets, Behr paint, and Merillat cabinets climbed over the years promoting its profitability as a company. Our company will cooperate with top manufacturers in the country to expand our business even further. Some of the companies are TOTO Hydrotect, KOHLER, Universal bath systems, Casey enterprises, Nemiroff Corporation, Abcon kitchens and Gibralter Construction Company (Bathroom systems, 1994). We will incorporate builders, constructors, retailers and merchandisers to ensure growth in all five departments of the company.

Incorporating Waterworks in our enterprise will increase our client base. The company is introducing an expanded range of lighting to illuminate porcelain and chrome (Mackeough, 2010). Sconces will impress the customer by counteract overhead lighting and take away the shadows when standing in front of a mirror. Therefore, we find what is missing in the market and provide it, at an affordable price, easy access and conveniently.

U.S export to China

China has a broad range of manufacturers of bathroom products. For the U.S manufacturers to find a niche in the Chinese market, they have to identify a loophole in the Chinese market. The products need to stand out, adequate mode of promotion and convenient distribution to clients. Moreover, they must be able to deliver what other products do not deliver, at an affordable price. There are available products in the U.S to supply to China. The two biggest players in vitreous china plumbing market are Kohler and American standards. Over the years, china plumbing fixtures received stiff competition from plastics and fiberglass.

 Although they still have much of the toilet bowl market, plastics took over lavatory sinks and water tanks. New products came up due to concern for the consumer. The new products were even accessible by wheelchair- bound and elderly customers. Another edge to them was the development of lead-free plumbing. Due to intense competitor, the manufacturers had to expand their distribution market as well as market (Wood, 2011). New technologies came into play, and costs lowered and distributor relationships improved. Although advertising costs plummeted, the customers now expressed more interest in the new products.

Watermark Designs in Brooklyn is making plumbing parts and shipping them to China (Dwyer, 2012). After manufacturers had folded because of the inability to compete with imports, Watermark penetrated China market. They were offering custom-made fixtures unique to each building. More so, they did it at a lower cost. Therefore, the company has supplied thousands of appliances in Shanghai, Macau, and Hong Kong. (Aurelio & Laura, 2014) analyzed the bathroom furniture market and wellness in China, ranging from the year 2009 – 2014.

For the longest time, the China market was dominated by European style cabinets, consumers never had a chance to experience real American products. However, with the discovery of channels to deliver American products, there is a real opportunity for business between the two countries. With economic growth and greater interest in American lifestyle, the Chinese market is optimal for American built and molded cabinets and furniture.  Research shows that China will continue to have 7.9% rate of growth while United States shows 2.8% growth. It is in attribution to consumption and not investment.

Expected budget

The budget is the most important business financial statement of the company. A well-managed budget allows the company to monitor the financial impact of the organization's decisions. Our company has five departments namely finance, market, storage, enterprise and customer service. All the five departments require new stuff. The total expected number of new staff is about 20.

We have a profit and loss budget in place for financial functioning of the company. It is going to guide us on expected income and expenses. The budget will be updated annually when we mark the end of the financial year. In the budget, we set revenue and expenditure data from business operating plans for the budget period. In drafting the budget, we put some things into consideration. We reviewed the approved business operating plan like the hiring of employees. We then separated activities into existing and new. It is good to note that hiring was already an existing activity while bills accruing from the business were new activities. We identified and made documents of all assumptions that we presented for the budget period. The regular reviews of the budget against actual results will give us real numbers of whether or not our company is on track. It will also guide us towards achieving the goals we set from the beginning of the budget preparation.

Shanghai Di Chen Building Material Co., Ltd Budget for 2015-2016
	For the Year Ending
	Cash at Beginning of Year			200, 000
Cash flows from Operations
Cash receipts from customers
	Cash Sales			50,000
	Cash collected from customers (debtors)			25,000
Funding from Creditors
	Stock purchased, not yet paid			(15,000)
Cash paid for
	Total Expenses			(45,000)
	Inventory (stock)purchases			(15,000)
Funding to Debtors
	Sales made not yet collected			25,000
Net Cash Flow from Operations				25,000
Investing Activities
Cash receipts from
	investment from parent			150,000
	Matured Investments			50,000
Cash paid for
	Purchase of property and equipment(Shipping vessel)			(35,000)
	Purchase of investments(Premises)			(15,000)
Net Cash Flow from Investing Activities				150,000
[42]
Financing Activities
Cash paid for
salaries	Business Depart.			(7,500)
	Marketing Depart.			(2,000)
	Finance Depart.			(1,050)
	Customer service			(4,000)
	Storage Depart.			(20,000)
Net Cash Flow from Financing Activities				(34,550)
Cash at the end of the year		140,450

Conclusion

The world is a global village in these present times. Businesses are going across borders faster and more efficiently. According to the information from the proposal, market of construction material continues to rise due to rising real estate market. Now, ceramic sanitary products importation is very high in the United States building equipment market. . However, with the discovery of channels to deliver American products, there is a real chance for business between the two countries. With economic growth and greater interest in American lifestyle, the Chinese market is optimal for American built and molded cabinets and furniture.  Research shows that China will continue to have 7.9% rate of growth while United States shows 2.8% growth. It is in attribution to consumption and not investment. Our company seeks to build large warehouses in the major cities along U.S west coast to develop small to mid-sized retailers. Therefore, we aim to provide an advantage regarding pricing of our products. To provide the customer with affordable and friendly prices, we will need to minimize the expenditure on our business delivery. The budget cuts across the five departments in the company namely business, finance, marketing, storage, and customer service. The five units will have directive expenses and counter incomes. The two ways of expenditure in the departments will allow the flow of resources to sustain the company for the next financial year.

 The percentage of import from China is as high as 122%.  The goal of the parent corporation is to adapt to the global trend and step into the world market. U.S market has the largest market capacity, and the parent company is already weighing cooperation’s with Masco Company in the United States of America. Research shows that bathroom accessories are becoming an integral part of the interior decoration of the houses in the U.S (Gannon, 2007). There are modernized urinals now that are very popular in the United States market. The Duravit U.S.A Inc. currently sells three models of urinals including Chronic, which consists of an infrared-triggered flush. Other companies like TOTO are presenting stiff competition in the industry.

Also, many U.S.A companies are exporting the products to China. The best example is Watermark Company, and that had to go through major setbacks in the U.S.A before venturing to the Asia. It was finally able to penetrate the market by presenting unique features with their products. The expansion of our company will expose the business to a wider audience, seeing that it is already receiving the positive response in China. The higher number of potential customers will in return raise the amount of sales and profitability.

 They also ensured that the price was rational to their clients. Having a business enables a company a company to plan ahead. Our budget is very precise and to the point. The company might be small but is much focused. We ensure prioritization of the funds allocation and gauge financial predictions before getting down to business. There are only a few employees to be hired by the organization. We are aware that for maximum market penetration, we need to hire local employees. They will make the marketing work easier since they know the market better than their Chinese counterparts. Our budget will be crucial to making keys decisions to enhance our business. The budget will be reviewed annually at the end of every year to ensure clarity and efficiency of the functioning of our company. The objective of the budget was to provide a guide to expected income and expenses of the new branch. It will also enable us to compare our anticipated fiscal goals with actual figures. It serves as a barometer of the overall performance of our esteemed company. It will allow us to plan ahead and minimize impulse spending as well as unplanned expenses.

References

Bathroom. (2014). Popular Mechanics, 191(9), 70

Barker, E. (2008). Detox Your Bathroom. Natural Health, 38(2), 68-69.

Woronov, N. (1989). Regional Chinese dance, American-style. Dance Magazine, 63(8), 28

Velaigam, M. (2007). Stephenson Harwood China office eyes US West Coast collaborations. Lawyer, 21(39), 10.

Donaton, S., & Mandese, J. (1993). `Decorating Remodeling,' Masco ink custom deal. Advertising Age, 64(10), 33.

Bathroom systems. (1994). Journal of Housing, 51(3), 7

Burden M, 2014. Masco spinning, lays off 40% of HQ staff

Wood L, 2011. Research and markets: A vitreous china plumbing fixture & earthenware bathroom accessories manufacturing industry in the U.S

Dwyer J, 2012. Manufacturing shift, made in U.S but sold in China

Aurelio V& Laura C, 2014. The bathroom furniture market and wellness in China.

Muñz, S. S. (2006, June 8). Shopping Around/Water-Saving Showerheads. Wall Street Journal - Eastern Edition. p. D4

Gannon, S. (2007, January 25). For the High-End Bathroom, Something Unexpected. New York Times. p. F6.

McKeough, T. (2010, August 19). Hogging the Bathroom. New York Times. p. 3.

Sherry Roberts is the author of this paper. A senior editor at MeldaResearch.Com in urgent custom research papers. If you need a similar paper you can place your order from nursing school papers services.