Executive summary

The report is based on the planning organic soap business by the name of “Soapy”. Targeted market approach will focus over using psychographic market segmentation as this is essential for managing the targeting market approach. The report will highlight the use of appropriate marketing mix as this will focus over making sure that the high quality of products will be introduced that will be used for fulfilling the market needs.

Industry analysis

The plan is to launch the organic soap business that will be used for entering within the market. The market size for Organic soaps is valued at USD 222.3 million in 2018 and it is expected that the growth of 4.7% is expected within future. Within the soap market the only major aspect is the use of high quality materials and fragrances that will not cause only harm to the individuals.

It is witnessed that the consumers will prefer to make their choice for buying organic soaps but it is equally important that the quality standards are maintained by business as this seems to be the only possible way through which the operational targets are met. The analysis will reflect that for businesses dealing within the organic soap industry will need to make sure that they are focusing over their key success factors i.e. cost, quality, fragrance and design. The industry trends refers that within the 5 years time an increase of CAGR3.2% is expected as this will help in becoming competitive in the business sector.

Company description

The business that will sell the organic soap will be introduced within Oman by the name of “Soapy”. The business will make sure that they are making organic soaps that will be used by the consumers. The mission of the soap business to make products that will give the skin benefits to the consumers and along with this through maintaining quality standards it will also be easy and convenient to accomplish their targets. The vision of Soapy is to assure that they are operating globally and are having well defined market for organic soaps. The business will operate as a sole trader and as a private business. Within Soapy the business decisions will only be taken by the owner. The business will offer wide range of products such as soaps, body washes and bath bombs. The skin care line will also be introduced by the business as this will look into ways through which the soaps are specially designed that will address skin issues within individuals.

Market analysis

The market for organic soap is present within the business as this will be used for making sure that the operational targets are met when the market needs and wants are addressed and analyzed in an effective manner. The buyers for the organic soap are increasing globally as consumers are becoming aware of using organic soap and its benefit for the skin. The market is completely changing and thus the basic individual expectations are the use of organic materials that will benefit the skin. The analysis will also represent that the buyer behavior is only relying over the quality standards retained by business in manufacturing their soaps and market for handmade soap is increasing.

The market segmentation will also be based on making sure that the consumers are segmented on the basis of demographics like their income and lifestyle. This type of segmentation is uses for organic soaps as they are high in price as compared to the other soaps and thus will require that the immediate business decision should be based on maintaining quality rather than costs. For targeting the market the use of mass marketing will be more appropriate as the consumer needs for organic soaps are basic i.e. quality and organic materials.

For the positioning of the products made by Soapy it is essential that the differentiation policy should be made as this will make sure that the quality standards are maintained and the costs will also be charged accordingly. The major competitor for Soapy within Oman is Latafa as this is the brand which is not only offering natural and organic products but are also having a well defined market which might be an issues for Soapy.

The economics of soap business

The business will be started by only incurring around OMR 150,000 as this is the amount that will be used for setting the packaging machinery and production lines. The revenue streams will be divided into three items soaps, body wash and bath bombs. The raw material costs are based on base used for making soap and then fragrances and customization that is essential. The analysis will also reflect that the fixed costs related to direct expenses such as electricity will also be incurred by the business. Initially the use of complementary pricing will be more appropriate as this will be used by the business in making sure that they are achieving their targets. The breakeven sales volume for Soapy is estimate at 1000 units and this is explained in the chart below: