Crayonic Design

Business Plan

April 21, 2009

Maria Hase
4620 E. Mountain Sage Dr.
Phoenix, Arizona 85044
480-636-0963

CONFIDENTIAL
 Table of Contents

1.0 Executive Summary…………………………………………………………………3

Objectives, Mission, Keys to Success

2.0 Business Description……………………………………………………………....4-5

The Company, Legal Structure, The Industry, Trends, Products or Services

3.0 Management………………………………………………………………………5-6

Owners, Managers, Qualifications, Employees

4.0 Operations and Location……………………………………………………………6

5.0 Marketing…………………………………………………………………………..6-7

Target Market, Market Share, Growth (graphs), Competition, SWOT, Pricing

Promotion and Advertising

6.0 Strategies and Implementation…………………………………………………...7-8

7.0 Financials…………………………………………………………………………..8-9

Capital Requirements

Balance Sheet

Income Statement

Cash Flow Projections

Ratios

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 Executive Summary

1.0 Company Summary: Crayonic Design is a business that secures unwanted or

discarded crayons and recycles them into different shapes, including, but not limited

to letters, numbers, fruits, vegetables, vehicles, Easter eggs, Christmas trees,

snowflakes, hearts, animals, flowers, insects, sports equipment, and party items,

using solar ovens. This is a green company whose target market is children 3-12

years old, and companies or businesses that cater to them.

1.1 Objectives: Crayonic Design’s first objective is to become a profitable company. It

then seeks to reduce and reuse the number of crayons needlessly discarded in local

communities by collecting old, unwanted crayons at the end of the school year, and from

restaurants who throw crayons away daily. These crayons are remolded into fun shapes

children, parents, and educators will love. The shapes can be used as talking points and

vocabulary builders when coloring with young children. They can also improve

children’s fine motor skills. A portion of all crayons collected will be mailed to Africa for

children who have limited school supplies. A portion of all sales will benefit local

community schools whose budgets have been severely cut.

1.2 Mission: Crayonic Design aims to reduce, reuse, and recycle while benefitting local

community schools and schools in Africa through its creative crayon products.

1.3 Keys to Success: There is an endless supply of old, unwanted crayons. There are

many children, parents, educators, and related businesses who are always looking for

fun products. This is one that can be catered to their preferences and needs.

1.4 Growth Projection: It is projected sales will reach $2,000 by the end of August,

2009.

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 Business Description

2.1 The Company: Crayonic Design consists of two employees. It is currently a home-

based business and will soon be an e-business. It is located at 4620 E. Mountain Sage

Drive in Phoenix, Arizona. It’s phone number is 480-636-0963. It’s domain names are

CrayonicDesign.com and CrayonicDesign.net. The website will be launched by the end

of May, 2009.

2.2 Legal Structure: Crayonic Design is a sole propietership with the intention of

becoming an LLC.

2.3 The Industry: Crayons were first created in 1903. According to a national poll in

1993, on average, a child uses 730 crayons by their 10th birthday, red and blue are the

most popular crayon colors, and, a crayon’s scent is the 3rd most recognizable, after coffee

and peanut butter. Most kids spend an average of up to a half hour a day coloring.

Because of their popularity, crayons are now used as promotional items. On average, a

pack of 4 crayons costs $.23 to $.68.

2.4 Trends: Magazines, school districts, and society are embracing being green. Eco-

friendly, solar energy, and recycling are buzz words.

2.5 Goals and Objectives: Crayonic Design’s goal is to decrease the waste in our society

by reusing and recycling crayons and related items (i.e. cans, crayon wrappers, etc.) in

new, fun, educational products children, parents, educators, and related industries will

love. In addition, Crayonic Design aims to send a portion of all crayons collected to

needy children in Africa, and it will give a portion of all proceeds to local school districts

whose budgets have been drastically decreased. It’s objective is to have sales reach

$2,000 by the end of August, 2009.

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2.6 Future of Business: Children continue to love crayons, so that bodes well for the

future of Crayonic Design. In addition, being green is the wave of the future, and

Crayonic Design aims to be green every step of the way from using solar energy to melt

the crayons to melting the crayons in reused soup cans, to reusing old, unwanted crayons.

2.7 Conditions Affecting Business: With budgets being cut, restaurants may eliminate

the crayons they distribute to children of customers who come in. In addition, schools

may not buy as many crayons due to budget cuts; therefore, they may not have as many

old, unwanted crayons. With the jobless rate up, parents may be decreasing the amounts

of money they spend on children’s entertainment and birthday parties. This in turn may

decrease the number of crayons they buy. During the summer months, parents may not

want to buy crayons or give them as party favors because of the mess they could make if

left in a hot car.

Management

3.1 Owners, Managers, and Employees: The sole propieter’s Crayonic Design

responsibilities include managing the company, manufacturing its products, marketing

them, and overseeing its financials. One other employee helps in obtaining old, unwanted

crayons, manufacturing the products, and marketing them. There are no other employees.

Operations Plan

4.1 Process: Old, unwanted crayons are collected from school districts and restaurants.

The crayons are peeled and sorted by color. Then they are melted down using solar

energy, remolded, and cooled. The crayons are packaged together for sale. At the

moment, reused soup cans are being used, along with a handmade solar oven, and the

occasional assistance of a gas oven and/or electric, single buffet burner. In the future,

solar ovens will be purchased.

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4.2 Location: The business is to be operated from home. The home is conveniently

located in close proximity to schools, preschools, daycares, dentists, pediatricians,

doctors and stores that cater to children.

Marketing Plan

5.1 Industry: The industry ecompasses the entire United States. Crayola dominates the

new crayon industry, which is worldwide and encompasses almost every elementary

school in the entire United States.

5.2 Target Market: The target market is children ages 3-12 years, their parents,

educators, and industries related to the target age group, including, but not limited to,

childcare, schools, speech/language pathology, occupational therapy, hospitals, Churches,

party stores, dentists, pediatricians, party locations (i.e. Chuck E Cheese, Amazing Jakes,

Peter Piper Pizza, Makutu’s Isand, Gymboree), toystores, restaurants, libraries, and

bookstores.

5.3 Demographics: 17.1% of the Phoenix population is under age 9, and 7.53% is 10-14

years old, according to http://phoenix.areaconnect.com/statistics.htm. The Phoenix

population is quoted at the same site as being 1,321,045 in 2009.

5.4 Competition: To our knowledge, no one else is doing this.

5.5 Pricing: Small packages of a variety of crayon shapes and colors, 7 per pack, have

been priced at $2.50. This pricing was determined after discussion with a number of

people and what they would be willing to pay for the crayons. Pre-packaging was

determined to be less intrusive for restaurants where the crayons might be sold and

distributed. If sold at craft fairs and farmer’s markets, customers could choose their own

7 crayons for $2.50. Should the crayons be ordered to look like a company template, the

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price would increase according to cost of the mold/s, labor, and materials needed to

complete the order.

5.6 Distribution Channels: The main distribution channels will be via website orders.

5.7 Advertising and Promotion: Most advertising will occur via word of mouth and on-

line at our website. Customers will be directed to our website via business cards ($3-$10

for 500) distributed at locations throughout the valley, and/or magnetic signs ($20-$40)

attached to the owners’ cars. Social media, such as Facebook, YouTube, and LinkedIn

will also be utilized. In the future, ads directing readers to our website may also be placed

in local magazines.

Strategies and Implementation

6.1 Advertisment: At least at the start, all advertisement will be via word of mouth,

business cards directing potential customers towards our website, magnetic car signs

doing the same, and our website. We will also utilize social media sites like Facebook,

YouTube, and LinkedIn to promote our products.

6.2 Web Strategy: Our web strategy is to direct as many people to our site as possible

via business cards, word of mouth, magnetic signs, magazine ads, Facebook, YouTube,

and LinkedIn. Once there, the objective of the site is to make it easily navigable by

children and adults. The ultimate goal is for all orders to be placed there. The website is

currently being designed in iweb and will be hosted by GoDaddy. We have purchased 2

domain names: CrayonicDesign.com and CrayonicDesign.net.

6.3 Personal Selling: This summer some personal selling will occur at local businesses

that cater to children. Our products will also be mentioned to parents at pools, parks, and

places children frequent in the summer during casual conversation.

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6.4 Sales Promotions: These will be launched in conjunction with upcoming holidays

such as Fourth of July, Halloween (our products make great trick or treating items),

Thanksgiving, Christmas/Hannukah, Valentine’s Day, St. Patrick’s Day, Easter, Cinco de

Mayo (our products are great for piñatas too), and birthday parties (our products are nice

additions to favor bags).

6.5 Networking, Referrals: It is hoped these will occur naturally, but they could be

facilitated and encouraged by offering small discounts/free incentives to those who have

made successful referrals.

6.6 Schedule: Summer: Update website once a week. Check website for orders daily. Fill

orders daily (6-9 a.m.) and mail them from post office that is within walking distance.

Market via word of mouth/magnetic signs, and leave business cards at places we

frequent, the remainder of the day. Update business records daily. Fall, Winter, and

Spring: Update website once a week. Check website for orders daily. Fill orders daily (3-

5:30 a.m.). Mail orders by 5 p.m. daily. Market with magnetic signs, business cards at

places we frequent, and use word of mouth daily. Update business records daily.

6.7 Budget: Crayonic Design’s budget is minimal. Just $62.27 have been spent so far, in

addition to the $23.38 it cost to register our domain names for a year. It is anticipated

hosting will cost an additional $100 or so, and business cards/magnetic signs will cost an

additional $50. It is anticipated that old, unwanted crayons will be acquired for free, and

solar energy will also be free, though a larger, more powerful, solar oven will eventually

cost $135-$300.

Financials

7.1 Capital Requirements: Website Hosting: $200

Marketing: $100

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 Solar Oven: $300

Miscellaneous: $300

Total: $900

7.2 Balance Sheet: The balance sheet will be reconstructed once the company is

incorporated. So far the sole proprietor has furnished all the initial capital.

7.3 Income Statement: 10 bags of crayons sold at $2.50 each, total $25.50 in sales

7.4 Cash Flow Projections: We have only tried to actively sell our product twice, to 2

different people, and on both occasions were successful. Crayonic Design has many more

packages of crayons ready to sell. It’s simply a matter of getting our business officially

registered and starting. From October, 2008, until January, 2009, $62.27 was spent. On

1/3/09 and 1/13/09 a total of $25.50 was made.

7.5 Ratios To be developed later.