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

This section will offer a financial overview of Acme Insurance as it relates to the marketing activities. Acme will address break-even analysis, sales forecasts, expenses forecasts, and how these link to the marketing strategy.

Break-even Analysis

The break-even analysis indicates that $21,667 is needed in monthly revenue to reach the break-even point.

Break-even Analysis

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Break-even Analysis
  
Monthly Revenue Break-even$6,546
  
Assumptions: 
Average Percent Variable Cost70%
Estimated Monthly Fixed Cost$6,500

Sales Forecast

Acme wants to emphasize the benefit of dealing with professionals who live and work in the client's area. Acme knows their needs and their problems and has a local reputation to protect, unlike an out-of-town market. If the out-of-town broker fails to provide proper cover or advice, they lose one client. Acme could stand to lose many if the public perceives a professional failure on our part. This theory is validated by the masse exodus of Andersen clients after the Enron scandal and during the Justice Department's investigation.

Competitive prices for our identified target markets. Discounts of up to 25% for claim-free seniors who renew their home insurance with Acme.

Careful inspection and the judicious use of deductibles and warranties for insureds using wood stoves should help alleviate company concerns about solid fuel heating devices. Competitive pricing is not an important factor to attract business because competition is very limited for primary wood heat houses in our area. This may provide a chance to pick up all of the insured's business because, in many instances, they contact Acme after being told by their previous broker that, in spite of their claim-free status, the broker doesn't want their house insurance.

Business partners provide us the opportunity to sell lower-priced, basic insurance coverage to our clients. Many clients have expressed interest in retaining part or all of the insurance risk, especially for burglary. They feel that if they have installed central alarms and bars, they can take the chance of self-insurance.

The following table and related charts show our present sales forecast. Acme is projecting sales to grow at 10% for the coming year and to continue into 2005.

Sales Forecast

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Sales Forecast
 FY 2011FY 2012FY 2013
Sales   
Senior Citizens$222,107$246,550$2,255,789
Lower Income Families$237,383$239,009$245,443
Total Sales$459,490$485,559$2,501,232
    
Direct Cost of SalesFY 2011FY 2012FY 2013
Senior Citizens$155,475$172,585$1,579,052
Lower Income Families$166,168$167,306$171,810
Subtotal Direct Cost of Sales$321,643$339,891$1,750,862

Expense Forecast

Marketing expenses are to be budgeted so that they are higher during the parts of the year when more insurance is sold. There is an increase in sales of personal insurance during the summer months and sometimes continuing into the fall. There is an increase in business sales during the first quarter of the year. The marketing expenses will correspond with this sales trend.

Marketing Expense Budget

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Marketing Expense Budget
 FY 2011FY 2012FY 2013
Advertisements$6,775$7,544$8,012
Printed Material$800$800$800
Other$810$900$940
 ------------------------------------
Total Sales and Marketing Expenses$8,385$9,244$9,752
Percent of Sales1.82%1.90%0.39%

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