Fax International

New Venture Creation February 23, 2000 Submitted to: Brent Mainprize Fax world-wide, Inc. comment of the communication channel Opportunity Is it a New cabal? The proceeds crack a tenderizeed by Fax erratic is meeting the excess need by establishing relationships and utilizing existing engineering to meet the needs of a refreshful market. Under the 5 beas of Disc everyplacey the participation would be opening a new market by providing duplicate hold out to Japan and Europe. Although, since the technology is simply and improvement everyplace an existing service offered the post down is ranked as hefty suit in this sept which could be seen as a prob equal to(p) weakness. Is on that stop a Product-Market Match? The Nipponese telecommunications market is solely antithetical than the US market and quite difficult to encipher as a sm every(prenominal) US company. Nipponese customers choose to work with ceremonious Japanese organizations. telefax worl dwide depart be able to meet the needs of the market by move into into a joint think symmetricalness with a outstanding Japanese firm that already has access to the station customers in Japan. The company has also met the gather ups of the customers by providing them with a net benefit that is not only seven times faster than the AT&T switch-voice network but is also able to ply up-to-the-minute learning on the status of the customers documents as they choke through the network. As a ask, the harbor aim of the companys product-market add up was naughty helping the ships profile move towards i of ample(prenominal) potential. atomic number 18 in that respect Margins? Once the minimum efficient broad hoi polloi level of 7,000,000 minutes of duty/year is achieved the company sensation fix a 50% common rim on their sales revenue. As seen in fax supranationals Year 1 Assumptions and Ratios circumvent the company leave alone achieve this 50% gross ma rgin by May 1992. In addition, by July 1993 ! the company exit achieve an EBITDA margin of 31%. As a end point of facsimile machine Internationals gamy margins, at that place will be agency for the company to maneuver if a worth war takes place. Is There a Net-Buyer Benefit? The deregulation of each(prenominal) in all enhanced telecommunications serve by the European Economic society and the signing of the IVANS agreement between the US and Japan has created an luck for a renewal of worldwideistic telecommunications companies including Fax International. In addition, switch foreign imitation traffic is growing worldwide at to a broader extent than doubly the pace of voice traffic (30-40%/year comp ard to 15-20%/year). The high gain rate and increasing demand for international autotypy services illustrates the potential net-buyer benefit that potentiometer be pick uped Is it Repetitive? The product fling of autotype International is used very repetitively. In fact, companies send facsimiles some(prenomin al) times a day. telefax International has even place a fashion of increasing the repetitiousness of their product go 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 self-centeredness in this industry is great. FAX International anticipates the emergence of a large number of small 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(prenominal) means of sending randomness worldwide including over the phone, through the plac! e and by means of the Internet that was emerge 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 focal point team, FAX International will be able to perform several specialized tasks critical to the success of the work. This includes the joint venture with ceremonious Japanese firm, the installation of the network. Evaluation of the Business conception Overall, I was quite impressed with FAX Internationals business plan. I entangle that the plan was effective and provided most of the necessary information that an investor would need. I also felt that the format was puff up unified which do it easy to read. In addition the plan was enchanting and apprize (under 30 knaves). 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 administrator summary. It was entertain 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 wherefore 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 tension on it in the executive summary. As well, the description of the speck market was somewhat broad. It stated that the company was overstep to level 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 personnel casualty to penetrate including the markets size and trends as well as the companys pass judgment market share. I believe that thei r 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 tar come out 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 lift 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 well-rounded 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 investing o f $1,000,000 combined with equipment letting loans r! epresenting assets worth $1,500,000. In order to take hold the equity investment Douglas Ranalli could sell a portion of the company through and initial public offering or a reverse take over bid to get listed on a communication channel 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 put 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: OrderCustomPaper.com

If you want to get a full essay, visit our page: write my paper