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This sample marketing plan was created with Marketing Plan Pro software.

Our marketing plan requires annual revenues of $1,600,000 for this year. We anticipate that we will have revenues of more than $2,500,000 within 5 years. Our marketing expenses will equate to an average of 2.5% of total sales throughout.

The marketing plan is based on these three parameters:

  1. Increasing our efficiencies through better use of our facilities and expertise. Variable costs will be reduced, as we are able to make use of the capital investment we have in our systems. We will invest in these systems with the expectation that we will benefit as we have in the past from their capabilities. It provides us a competitive edge many of our competitors cannot afford.
  2. We will continue to invest in marketing activities based on a percent of total revenues. As our revenues increase, so will our marketing resources.
  3. We will forecast and track revenues on a detail basis to provide objective feedback regarding progress in the areas of industry expertise, specialization, and client revenue sources by type.

Break-even Analysis

Our variable costs are less than 38% of revenues. This is a result of our fixed costs including our facility, computer and technology expenses, and our salaried staff. Variable costs include temporary/seasonal hires, compensation for CPAs based on performance, and client demands that require travel and other per-job based expenditures. Variable costs are expected to continue to decrease as a percent of revenues as we strive to further benefit from technology and become less dependent on wages and salaries.

Break-even Analysis

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Break-even Analysis
  
Monthly Revenue Break-even$42,283
  
Assumptions: 
Average Percent Variable Cost31%
Estimated Monthly Fixed Cost$42,250

Sales Forecast

Revenues for this year are based on a 5% growth rate. This is conservative and will be more challenging as we work to diversify our revenue base.

Sales Forecast

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Sales Forecast
 20062007200820092010
Sales     
Business Clients - Tax Preparation$448,000$447,200$480,000$614,400$787,000
Business Clients - Tax Planning$272,000$258,000$260,000$304,200$356,000
Business Clients - General Consulting$144,000$206,400$300,000$324,000$350,000
Business Clients - Other$112,000$154,800$200,000$216,000$233,000
Individual Clients - Tax Preparation$352,000$309,600$300,000$360,000$432,000
Individual Clients - Tax Planning$128,000$137,600$140,000$152,600$166,000
Individual Clients - Personal Finance Consulting$96,000$154,800$240,000$256,800$275,000
Individual Clients - Other$48,000$51,600$80,000$82,400$85,000
Total Sales$1,600,000$1,720,000$2,000,000$2,310,400$2,684,000
      
Direct Cost of Sales20062007200820092010
Business Clients - Tax Preparation$147,839$147,567$148,550$149,800$150,500
Business Clients - Tax Planning$89,760$91,200$92,800$93,400$94,500
Business Clients - General Consulting$47,522$48,500$49,500$50,500$52,000
Business Clients - Other$36,960$37,500$38,500$39,500$40,000
Individual Clients - Tax Preparation$95,039$96,500$97,500$98,500$99,500
Individual Clients - Tax Planning$34,561$36,000$37,200$38,300$39,200
Individual Clients - Personal Finance Consulting$25,921$26,500$27,500$28,500$29,000
Individual Clients - Other$12,960$13,500$14,500$15,500$16,000
Subtotal Direct Cost of Sales$490,562$497,267$506,050$514,000$520,700

Sales by Partner

As the projection shows, we track revenue by partner, but a significant amount of the total revenue comes from the billing of the staff itself. Craig Moore will be retiring in the year 2010. The detail for this table is included in the appendices.

Sales Breakdown by Partner

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Sales by: Partner
 20062007200820092010
Sales     
Franklin$193,300$223,000$230,000$234,000$236,000
Moore$169,600$200,000$207,000$150,000Retiring
Benning$167,000$195,000$202,000$210,000$230,000
Sonnett$152,800$184,500$189,000$195,000$200,000
Cummings$154,100$185,000$190,000$196,000$200,000
Williams$145,800$178,000$186,000$192,000$200,000
Other$617,400$554,500$796,000$1,133,400$1,618,000
Total$1,600,000$1,720,000$2,000,000$2,310,400$2,684,000
Average$228,571$245,714$285,714$330,057$447,333

Sales by Segment

Our most important markets are our "large" and "growth" business clients. We have made strides to focus on revenues from these more profitable and faster-growing segments. This lowers the dependency on our "individual" client base, and our goal is to continue this focus for the future.

Sales Breakdown by Segment

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Sales by: Segment
 20062007200820092010
Sales     
Large Business$672,850$702,000$815,000$889,000$1,000,000
Growth Business$538,500$516,000$600,000$694,000$900,000
Individuals$388,650$502,000$585,000$727,400$784,000
Total$1,600,000$1,720,000$2,000,000$2,310,400$2,684,000
Average$533,333$573,333$666,667$770,133$894,667

Sales by Specialization

Our three targeted areas of specialization in medical/health, dental, and lodging represent a relatively small portion of total income, but these are some of the most profitable accounts for the firm. These areas also offer the possibility of ongoing monthly billing opportunities to spread billing throughout the year, versus the heavy concentration of activity around the tax schedule. Manufacturing still represents a significant number of annual billable hours, but the low to no-growth rate no longer makes this an attractive segment.

Sales Breakdown by Specialization

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Sales by: Specialization
 20062007200820092010
Sales     
Medical/Health$27,200$309,600$380,000$472,500$550,000
Dental$24,000$275,200$340,000$405,000$500,000
Lodging$192,000$223,600$280,000$337,500$400,000
Manufacturing$64,000$68,800$60,000$67,500$75,000
Individual Revenues$304,000$550,400$620,000$652,500$67,500
Other$988,800$292,400$320,000$375,400$1,091,500
Total$1,600,000$1,720,000$2,000,000$2,310,400$2,684,000
Average$266,667$286,667$333,333$385,067$447,333

Expense Forecast

Marketing expenses will correlate with firm revenues. This is based on a 2.5% factor of annual revenues. These expenses include any client development activities that promote the firm or any individual within the firm.

Each partner has an individual budget for his or her marketing activities. The combined totals for those by marketing line item are listed in the following table.

Marketing Expense Budget

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Marketing Expense Budget
 20062007200820092010
Advertising$4,848$5,000$5,200$5,400$5,600
Dues$1,940$2,250$2,450$2,650$2,800
Meals & Entertainment$2,020$2,400$2,600$2,800$3,000
Printed Materials$9,700$10,800$12,900$14,500$16,000
Public Relations$5,600$5,850$6,350$6,550$7,200
Sponsorships$6,868$7,200$7,650$7,800$8,400
Travel$4,444$4,600$4,900$5,200$5,600
Web Support$4,848$5,500$6,000$6,800$7,500
Other$600$600$800$1,000$1,200
 ------------------------------------------------------------
Total Sales and Marketing Expenses$40,868$44,200$48,850$52,700$57,300
Percent of Sales2.55%2.57%2.44%2.28%2.13%

Expense by Partner

As the table and chart shows, with additional information in the appendices, a majority of our expenses are managed by the seven partners, not by marketing. Each partner has an expense allocation that is overseen by marketing to deal with specific client development programs, marketing of expertise, and related projects. Marketing holds each partner accountable, although not always an easy task, to leverage these client development resources for the best return possible.

Expense Breakdown by Partner

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Expenses by Partner
 20062007200820092010
Expenses     
Franklin$5,000$6,000$6,500$6,750$7,000
Moore$5,000$6,000$6,500$6,750$0
Benning$4,850$5,500$6,000$6,250$6,600
Sonnett$4,800$5,500$6,000$6,250$6,600
Cummings$4,650$5,000$6,000$6,250$6,600
Williams$4,250$5,000$5,500$6,000$6,500
Moore$4,100$5,000$5,500$6,000$6,500
Other$8,218$6,200$6,850$8,450$17,500
Total$40,868$44,200$48,850$52,700$57,300
Average$5,109$5,525$6,106$6,588$7,163

Expense by Segment

Consistent with our growth strategy, a majority of our expenses are dedicated towards marketing to businesses rather than individuals. Our marketing expenses are targeted to communicate our expertise and how those skills will benefit business clients.

Expense Breakdown by Segment

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Expenses by Segment
 20062007200820092010
Expenses     
Business$26,900$30,000$34,000$36,000$39,000
Individual$11,000$12,000$13,500$15,400$17,000
Other$2,968$2,200$1,350$1,300$1,300
Total$40,868$44,200$48,850$52,700$57,300
Average$13,623$14,733$16,283$17,567$19,100

Expense by Specialization

The following table and chart show our expenses broken down by specialization.

Expense Breakdown by Specialization

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Expenses by Specialization
 20062007200820092010
Expenses     
Medical/Health$9,800$0$12,000$15,000$17,000
Dental$9,800$0$12,000$13,500$15,000
Lodging$8,200$0$10,000$12,000$14,000
Other$13,068$44,200$14,850$12,200$11,300
Total$40,868$44,200$48,850$52,700$57,300
Average$10,217$11,050$12,213$13,175$14,325

Linking Expenses to Strategy and Tactics

Our marketing expenses represent a small portion of total revenue generated, as illustrated on the following graph. Regardless, marketing-based efforts and our marketing expenditures must produce results. Our Marketing Director tracks this correlation and reports to the partners regarding our progress at our scheduled meetings. We expect to see our strategies impact the bottom line in the preferred areas. Our relatively conservative approach appears to be a good fit. An unexpected decrease in revenues will impact our marketing budget, and we will address this issue if required.

Contribution Margin

Contribution margins should increase as a result of these factors:

  1. Increased efficiencies and revenue through specialization.
  2. Increased efficiencies through use of our available technology.
  3. Economies of scale from growth and better utilization of capacity.
  4. More evenly spreading work out throughout the calendar year.

Contribution Margin

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Contribution Margin
 20062007200820092010
Sales$1,600,000$1,720,000$2,000,000$2,310,400$2,684,000
Direct Cost of Sales$490,562$497,267$506,050$514,000$520,700
Other Variable Costs of Sales$4,855$0$5,200$5,600$5,850
 ------------------------------------------------------------
Total Cost of Sales$495,417$497,267$511,250$519,600$526,550
      
Gross Margin$1,104,583$1,222,733$1,488,750$1,790,800$2,157,450
Gross Margin %69.04%71.09%74.44%77.51%80.38%
      
Marketing Expense Budget20062007200820092010
Advertising$4,848$5,000$5,200$5,400$5,600
Dues$1,940$2,250$2,450$2,650$2,800
Meals & Entertainment$2,020$2,400$2,600$2,800$3,000
Printed Materials$9,700$10,800$12,900$14,500$16,000
Public Relations$5,600$5,850$6,350$6,550$7,200
Sponsorships$6,868$7,200$7,650$7,800$8,400
Travel$4,444$4,600$4,900$5,200$5,600
Web Support$4,848$5,500$6,000$6,800$7,500
Other$600$600$800$1,000$1,200
 ------------------------------------------------------------
Total Sales and Marketing Expenses$40,868$44,200$48,850$52,700$57,300
Percent of Sales2.55%2.57%2.44%2.28%2.13%
      
Contribution Margin$1,063,715$1,178,533$1,439,900$1,738,100$2,100,150
Contribution Margin / Sales66.48%68.52%72.00%75.23%78.25%

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