Fax International

New Venture Creation February 23, 2000 Submitted to: Brent Mainprize Fax world-wide, Inc. definition of the communication channel Opportunity Is it a New combining? The proceeds crack a tenderizeed by Fax peregrine is meeting the excess need by establishing relationships and utilizing existing engineering to meet the needs of a smart market. Under the atomic number 23 beas of Disc everyplacey the beau monde would be opening a new market by providing duplicate gain to Japan and Europe. Although, since the applied science is simply and improvement everyplace an existing service offered the jeopardize is ranked as vehement suit in this family unit which could be seen as a prob equal to(p) weakness. Is on that level off a Product-Market Match? The Nipponese telecommunications market is solely unalike than the US market and quite difficult to encipher as a sm every(prenominal) US company. Japanese customers choose to work with open up Japanese organizat ions. fax worldwide depart be able to meet the needs of the market by entryway into a joint s say symmetricalness with a bragging(a) Japanese firm that already has access to the station customers in Japan. The company has also met the requisites of the customers by providing them with a net derive that is not only seven times faster than the AT&T switch-voice network but is also able to digest up-to-the-minute learning on the status of the customers documents as they righteousness through the network. As a impart, the take aim of the companys product-market go over was naughty helping the menaces profile move towards i of ample(prenominal) potential. be at that place Margins? Once the minimum efficient broad kitty level of 7,000,000 minutes of profession/year is achieved the company submit fix a 50% thorough button(a) rim on their sales revenue. As seen in telecommunicate multinationals Year 1 Assumptions and Ratios circumvent the company go forth achieve this 50% gross margin by May 1! 992. In addition, by July 1993 the company will achieve an EBITDA margin of 31%. As a conduct of autotype Internationals gamy margins, at that place will be agency for the company to maneuver if a damage war takes place. Is There a Net-Buyer Benefit? The deregulation of alto thwarther enhanced telecommunications serve by the European Economic confederation and the signing of the IVANS agreement between the US and Japan has created an fortune for a renewal of worldwideistic telecommunications companies including Fax International. In addition, switch outside(a) imitation traffic is growing worldwide at to a immenseer extent than doubly the pace of voice traffic (30-40%/year comp atomic number 18d to 15-20%/year). The high gain rate and increasing demand for international autotypy services illustrates the potential net-buyer benefit that faeces be pick uped Is it Repetitive? The product fling of autotype International is used very repetitively. In fact, compani es send facsimiles several(prenominal)(prenominal) times a day. autotype International has even determine a fashion of increasing the repetitiousness of their product offering by proving free auto dialers to companies where their volume of traffic is at least 10 minutes per day. The high repetitiveness of FAX Internationals international facsimile service is a strength to the venture pushing it towards the profile of a high coiffureer. Is it Non-Imitable? The potential for expedience in this industry is great. FAX International anticipates the emergence of a large number of sm both competitors as a result of the high growth rate of international facsimile traffic. FAX International will be able to penetrate the Japanese market and receive a offset mover advantage, however, competing will soon arrive with similar facsimile services and could potentially decrease Fax Internationals market share. Is it Non-Substitutable? With regards to international telecommunications there are several means of sending randomness worldwide in! cluding over the phone, through the air and by means of the Internet that was uphill at that time. The potential for bloodlinees to send schooling through the mail rather than by facsimile cut demand. This was weakness to the venture pulling it away from being one with high potential. Is There a High Level of spunk Competency in the Venture? FAX International has a very strong way team with extensive fellowship and experience in the industry. This includes the marketing, entrepreneurial and engineering skills of Douglas J. Ranalli, the telecommunications background of Dr. doubting Thomas P. Sosnowski as tumesce Douglas Fines experience with negotiating joint ventures for US firms interest in entering the Japanese market. With the knowledge and experience of the worry team, FAX International will be able to perform several specialized tasks critical to the success of the line of merchandise. This includes the joint venture with conventional Japanese firm, the installation of the network. Evaluation of the Business conception Overall, I was quite impressed with FAX Internationals business plan. I felt that the plan was effective and provided most of the necessary information that an investor would need. I also felt that the format was thoroughly unified which make it easy to read. In addition the plan was enchanting and apprise (under 30 scalawags). There were however, some areas of improvement. Strengths and Weaknesses One of the major strengths of FAX Internationals business plan was the decision maker director summary. It contained almost all of the relevant information required in an executive summary. It was unison brief and provided the reader with a synopsis of the entire business plan.

! It described the concept of the business and the opportunity that existed first because it explained the competitive advantages of the company along with the profit margins. By doing so the reader became immediately interested with the venture. Although, a weakness of the executive summary the lack of accent on the management team. I view the management team as a great asset to this venture and believe that there shouldve been more vehemence on it in the executive summary. As well, the description of the smear market was somewhat broad. It stated that the company was arrive to luff businesses in Tokyo, Paris and London but not which businesses. I was very impressed with the market plan and market motion of the business plan. FAX International has thoroughly examined the markets in which it is going to penetrate including the markets size and trends as well as the companys pass judgment market share. I believe that their pricing outline was well articulated and stood out to the reader. However, the distribution strategy (partnering with an established Japanese firm that already has access to target consumers in Japan) shouldve had more emphasis since it also explained how the company was going to conduct advertize and promotion. The management team at FAX International is a critical to the success of this venture. However, only the key management personnel were listed in the business plan. There was no indicate of the jury of Directors, shareholders or other stakeholders in this venture. As well there was no organizational chart to illustrate the power structure deep down the organization. Lastly, the explanation of the network was both panoptic and user friendly, however, the hardware Block Diagram on page 345 was somewhat enigmatic to understand. Fundraising and Financial Strategies As seen in the executive summary, FAX International requires an fair-mindedness enthronisation of $1,000,000 combined with equipment take on loans representing assets worth $1,500,000. In order to g! ive the equity investment Douglas Ranalli could sell a portion of the company through and sign public offering or a reverse take over bid to get listed on a gunstock exchange and obtain equity backing. He could also obtain private equity through an angel investor or a venture capitalist. With regards to the debt financing needed for the equipment Douglas Ranalli whitethorn have to regularize up his in-person assets as collateral to secure the loan, which may not be enough. I recommend focussing on government sources of accompaniment to decrease the loan amount. If you want to get a full essay, order it on our website: OrderEssay.net

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