THE WORM EATS BIRD BUSINESS PLAN (UNDER REVIEW owing to reduced interest in NFT gallery) by Tamlyn Hodson
EXECUTIVE SUMMARY Congratulations and welcome...We make the real thing....That’s our business....A lady’s quilted leather bag should tell a story, for example. It’s hand stitched and hand crafted as only the most flexible methods enable the challenging facets of the design to be realised. It takes considerable time, so it makes sense to make each one unique. We’re already perhaps the only online shop in the world where someone can purchase a unique hand crafted and hand stitched quilted leather bag. We’ll challenge our competitors by demonstrating this integrity and commitment to the heart and soul of genuine creativity and what it communicates about our passion, using the best methods for unique energy and style in all our products. Many of our customers will likely profit by reselling our products in the future when our reputation has grown. Our broader, more casual factory processed fashion range and printed wall art will celebrate our aesthetic to satisfy increasing demand from aspirational followers.
OUR BUSINESS MODEL We’ll maintain a range of unique and dynamic hand crafted items which demonstrate the prestige of our brand and our reputation for investment grade products. We’ll drive higher sales volumes of more affordable goods which are partly machine-processed.
When demand permits, we can also sell work produced with collaborating artists and artisans. Whilst collaboration may reduce our share of profit made on a related sale, it will broaden our range and improve overall income potential, as products made by others incur lower manufacturing costs. This should strengthen our presence in the wider art and fashion community which in turn could smooth operations and public relations in the longer term.
We’ll initially pursue direct-to-consumer sales online while seeking to sell appropriate ranges through physical retailers when demand permits. We’ll establish our own physical outlet in a sufficiently prestigious location as soon as this is financially viable.
INVESTMENT OBJECTIVES Our immediate goal is to generate greater traffic to our online shop. We’ll make our first sales by increased Facebook and other social media advertising while running a limited campaign in printed media for testing purposes. We’ll extend our range of lower-priced merchandise to satisfy increased demand for our brand. Costs incurred from raising share capital such as Corporation Tax will be considered evenly across all operating tasks. Estimated funds available below include possible revenue gained from selling some physical stock in addition to capital raised by shares issued.
£30,000 will be reserved for first year marketing costs which includes post and packaging expenses. £1,000 will be reserved to cover the cost of developing more factory-produced items we’ll initially sell made-to-order. A further £20,000 will be reserved if employment of a part-time assistant is required to maintain social media posts and dispatch items we have sold.
Our year two goal is to increase demand with further social media campaigns and advertising in nationwide printed media with £40,000 reserved for this combination, including post and packaging costs. I’ll continue expanding product creation and planning the future operations. £3,000 will be reserved for factory-produced merchandise development. £20,000 is reserved again for employing assistance and more can be paid if year 1 revenue exceeds expectations.
I expect years 1 and 2 trading will justify a £60,000 reservation for year 3 marketing, post and packaging. An additional £6,000 is reserved for development of factory-produced merchandise such as sneakers and large luggage. By this time, I expect sales could justify further costs for employing in-house assistance and increasing production of jewellery and wristwatch items.
£120,000 of investment funds will be reserved to cover a yearly £34,000 Director’s salary paid monthly with an additional £18,000 paid as soon as funds are secured to cover personal considerations. I’ll use part of this salary to cover all materials required to make further products for our couture range including leather items. I expect to make at least 5 such items per year. If demand permits I can make more if we employ further assistance.
£300,000 capital raised therefore covers the following expenses for our first 3 years of trading:
£130,000 Advertising/Marketing including post and packaging costs for items sold. (NOTE - this amount also includes a small reserve to cover costs for an accountant where law requires. We’ll seek to minimise this cost until revenue permits).
£40,000 for employing assistance to grow our social media profile and dispatching of products. £10,000 reserved for development of more factory-produced merchandise.
£120,000 Director’s income including all costs for making new couture items. During the course of trading, I’ll plan our second round of fund raising to permit operations to continue after 3 years. Ultimately, we’ll seek unlimited growth to provide higher employment and an eventual public listing of our brand on the stock exchange to support the wider industry.
OUR MARKETING PLAN We’ll immediately increase spending on Facebook advertising. To date, 1 Like per advertised post has typically resulted from each £1 paid to Facebook when a minimum of £40 is spent. Spending under £40 has shown a lower rate of conversion. These appear to be genuine Likes from real Facebook profiles. ‘Page’ Likes for Worm Eats Bird generally result from sending requests directly to those who have Liked a post with around a 20% rate of success or for each £5 spent. We currently have around 500 Page Likes. I believe we can reasonably expect our first sale when 1,000 page Likes are reached or when £2,500 of our advertising budget is spent. Once our profile shows this level of support, I expect more of those Liking our posts will also Like our page. We’ll adjust our promotional spending on other such social media platforms according to results achieved.
With turnover and greater social media presence, additional promotion of our brand in nationwide printed media will likely drive sales higher. Printed media promotions cost considerably more. However, this will likely attract higher spenders, as inclusion in prestigious printed publications will demonstrate approval of our brand by outside institutions. It may also help persuade physical retail outlets to stock our products if our brand is supported this way. We can alert our online followers to the printed publications to give extra reassurance of our integrity.
When advertising shows sufficient results we can invite customers to attend live VIP events where they can see our physical products and digital NFT displays in person, such as in rented gallery space or at pop-up catwalk shows. Customers could be measured there for hand-crafted shoes or other bespoke items on display. We can film these events to display on our website. After one year of trading, we could apply to display at live London Fashion Week events if we have our products selling in at least 6 physical stockists or in a digital-only promotion, if we continue as a direct-to-consumer operation.
Sufficient trading could enable us to establish one or more physical outlets in a prestigious zone where foreign tourists like to shop, for example. Eventually, we’ll promote our company’s success in the financial media with a view to securing a stock exchange listing.
RISK MITIGATING MILESTONES - 1,000 Facebook Likes and our first online sales... - Revenue generation accelerated by promotional artwork sold with share certificates... - A wider range of products including lower-priced machine-processed merchandise... - Increasing momentum of sales generated by wider social and printed media campaigns... - Moving from digital only displays to events, retail outlets and our own shop where customers can see our products in person... - An eventual stock market listing...
OPERATIONS I’m Director and currently our sole employee working from home selling directly to consumers via the internet. I’m entirely responsible for making all hand crafted products and designing any other products for sale including our NFT art work collection and all related e-commerce publications. The t-shirts and sweatshirts we sell are digitally printed by clothes2order.com to my design. Our silk head scarves are printed by contrado.co.uk to my design and I hand roll and hand stitch the hems to finish them. I currently source our packaging from midpac.co.uk. The following suppliers are among those I use to source leather, fabric and essential hardware: leprevo.co.uk, metropolitanleather.co.uk and pittards.com. We’ll consider moving operations into a commercial production facility where additional employees can operate, when revenue permits.
FINANCIAL PROJECTIONS There’s risk in most business ventures including ours but I truly feel the following projections fairly represent the lower end of potential owing to the quality of our products:
GROSS PROFIT (product list price minus cost of physical construction material eg. not considering Director’s salary, taxes, other employee costs, marketing, post and packaging).
Current margins vary with different types of product made. The materials used to make leather items in our Couture range cost little more than leather items of a similar size in our Fashion range so financial returns for the Couture range are greater. However, it takes considerably more time to craft a couture item. The benefit of couture is more promotional, as it adds prestige to our brand. We can increase profit margins when demand permits but for the time being estimates assume the following: Our printed t-shirts are currently priced at £75 and cost £17.97 for a single sample. Profit is therefore around 317%. Our sweatshirts are £135 and cost £30.84 each so profit is around 338%. Our printed silk head scarves are £375, as I hand-sew the hems. They each cost £49.71, so profit is 654%. There are discounts available for multiple orders from printers, so profit could increase with demand. If demand increases satisfactorily, we could eventually acquire in-house printing machines to maximise profit. All prints are currently made to my design.
Leather bags from our Fashion range cost around £31 in material, as a quality vegetable tanned bovine leather shoulder costs about £100 and can make 3.5 shoulder bags. They have an average price of £400, so profit is around 1,190% for £31 spent. The highly skilled method of crafting our leather items creates their dynamic style, so we need not procure expensive metal decorations. The cost of essential inexpensive metal parts such as buckles is included in these figures. Leather bags from our Couture range also cost around £31 in materials. With an average price of £2,695, profit is about 8,594%.
The custom wristwatches we have for sale in our Lifestyle range cost around £100 in materials and prices start at £5,000 owing to the time and skill it takes to make one. Potential profit can therefore be assumed at 4,900% and above. Other products in this range offer similar returns.
Ultimately, I believe there is sufficient room in the above profit estimations to absorb employee and other operating costs and still provide satisfactory returns for investors, once sales volumes gain momentum. With increased demand, we can make more expensive items while reducing or raising prices for factory-assisted goods. With these predictions considered, I feel it’s fair to soon imagine selling 4,000 items with an average net profit of £500 each to reach a £2,000,000 target and beyond. All our products are derived from the same creative integrity which is our vision. Our pricing is appropriate for the production methods used and our style is consistent through our entire range.
YEAR 1 TURNOVER £267,815 (under review in red): - Sales of £225,000 from our initial shares issues with complementary printed wall art - Sales of digitally printed textile garments/accessories = £11,925 if we sell 30 X £75 T-Shirts, 30 X £135 Sweatshirts 15 X £375 Silk Head Scarves - Sales of 10 units of standard hand crafted leather goods from our Fashion range at an average price of £400 = £4,000 turnover. - Sales of 20 units of leather belts and contour belts from our Fashion range at an average price of £230 = £4,600 turnover. - Sales of 5 units from our Couture range at an average £2,720 price = £13,600. Sales of 2 units from our Lifestyle range at an average £4,345 price = £8,690
YEAR 2 TURNOVER £535,630: This figure is derived by multiplying predicted year 1 sales X 2. During our first year of trading our social media campaign will have intensified. Printed media advertising could by now have great effect and demonstrate outside approval of our brand. We can send marketing emails to established customers who consent. Sales momentum should be growing and could be boosted by our increasing product range.
YEAR 3 TURNOVER £1,071,260: Estimated again by multiplying predicted sales of the previous year X 2. Knowledge of our brand should be reaching a much wider audience, including overseas customers, as we become a go-to centre for Real McCoy Luxury, Art and High Fashion.
YEARS 4, 5 AND BEYOND £ + UNLIMITED: In years 4 and 5 of trading, successful financial history will permit expanding our promotions to financial media to attract more high earning customers and future investors in our potential stock exchange listing. We’ll be making savings on larger runs of machine-processed goods to meet greater demand. The hand crafted products we continue to make will be more advanced. We could be a world famous luxury brand by this time and your investment could by now provide increasingly suitable selling opportunities should you so wish.
CURRENT ASSETS An accomplished full time Director who personally achieved the following: hand crafted and hand stitched all current leather products for sale...cleaned and assembled the movements for our watches, polished the steel cases and hand engraved and enamelled their fine silver dials... created all related digital art, e-commerce and social media productions...designed our range of fashion items which can be factory produced.
www.wormeats.com currently has 71 completed listings valued at £105,475 excluding potential value for 49 non-custom items which can be reproduced, including 15 which are more readily produced on machine to our design.
opensea.io/wormeatsbird has NFT artworks for sale with attached share certificates This digital gallery will later also publish NFT artworks not linked to shares. The potential of this income stream is more speculative owing to volatility surrounding related cryptocurrencies.
All tools required to make further hand crafted products and a limited stock of materials such as fabric, leather and wristwatch parts.
The ‘Worm Eats Bird’ brand is a registered trademark at the UK Intellectual Property Office (www.gov.uk/ipo), number UK00003177937.
The ‘M Wray and Son’ brand is a registered trademark at the UK Intellectual Property Office (www.gov.uk/ipo), number UK00003094145.
We have 17 designs registered with the UK Intellectual Property Office (www.gov.uk/ipo), numbers: 6062564, 6062565, 6062566, 6081838, 6081835, 6081836, 6081837, 6098372, 6098373, 6098374, 6098375, 6098376, 6098377, 6098378, 6098379, 6098380, 6098381.
I did not register designs for the creation of unique hand crafted items we’ll never duplicate, as copyright protection is automatic for artistic work.
THE DEAL This plan is written with the assumption of securing the full £300,000 of investment sought for a 15% share of the company. I have the skills to lead us to a central position in the luxury world. Your shares will ensure you own an agreed percentage of any current or future trade under the Worm Eats Bird or M Wray and Son brand or company.
Our records at Companies House will demonstrate turnover once our first sale of any shares or physical product is achieved. Quarterly reports will be produced to record all transactions and trade once active. A yearly statement will also be produced and made available to shareholders in accordance with UK laws. Shareholders can also request copies or contact us with questions at any time.
M Wray and Son Limited is the parent company of the Worm Eats Bird brand. Marion Wray is my mother. She is not a formal representative or shareholder of the company but is hugely supportive and a source of great knowledge and inspiration.
'Worm Eats Bird' is a registered trademark of M Wray and Son Limited, Company Number 09767949. All our products are made in England. Please contact usby email at email@example.com with any enquiries. Thank you...