Kinder Salon – A Hairdressing Salon For Children In Larnaca, Cyprus

Hours

Kinder Salon, a hairdressing salon for children with staffs that entertain children, even the salon will also have a playground. Kinder Salon will be based in Larnaca, Cyprus. Kinder Salon will provide unique haircut experience to the children in the playground and the staffs will be experienced in the field. For the parents, it is always a thing of anxiety when they take their children to the salon for a haircut. The hairdressers know the kids who wail, wiggle and may even bite the hands that shear them. There will be a restroom and waiting rooms for the parents who would come to the salon with the children. There will be swing, Bugaboo, rides pin, slip, carousel and deep diver inside the playground where the children can play. This Kinder Salon will be for the children aged between 2 years and 14 years. There will be a kids’ library where the children can read books also. This salon will offer different types of haircuts to the children. The salon experts will use the latest cutting edge technology to cut, colour and style the hair. The parents can take the children for a general haircut, for party-ready and for events by making an appointment.

Hours:

Monday: Closed

Tuesday- Friday: 9:30am -7pm

Saturday and Sunday: 10am – 4pm.

The mission statement of Kinder Salon is to be the one-stop hairdressing salon for new haircuts, styles and colours for the children where the haircut is amusement and fun.

2.1 PESTLE Analysis 

Political:

The country has unitary presidential representation, where the President of Cyprus is the head of the state and the head of the government. The political condition of the country is still unstable as both Greece and Turkey tried to invade the nation. There are some military enforcement form the UN, and Green Line divides the country into two parts (Tsangas et al. 2018). The population of the country combined both the sections is 1.1 million and that will help to increase the productivity of the business.

Economic:

Cyprus got independence from the UK in 1960 and became the member of EU in 2004. The GDP contraction of 16.8% in 1974 and 19% in 1975 experienced some external shock for the business (Savyides 2016). Collective focus changes the into rapid business growth and in 1976 economy was in 18.3% and in 1977 the growth rate was 15.8%. Economic freedom score is 67.8 and that is the reason, Cyprus is considered as the 48^th freest nation in 2018 and thus business advancement is there. $21,698 billion is the GDP stat of the country and they have achieved 109^th rank in case of GDP (Hadjikoumis et al. 2017). There are 426,000 labour force included in the different sector of organisation and that increase business development and opportunities.    

Political

Social:

Greek and Turkish people are accumulated in the nation, so there are some cross-cultural problems. This problem may hamper the business process as the mentality of all the people are not the same. In the case of the emerging situation of a business, social support is the most important aspect of business advancement. The business will emphasise the change in business through the social outcome of people. Households Debt to Income in the country Cyprus got the average 151% until 2017 and it reached all time high in the year 2014, 203% (Giannakis and Mamuneasb 2018).

Technological:

Improve ICT and cyber security policy is important and Science technology Park improved the technological advancement in business (Tsangas et al. 2018). As the country has communities of Greece and Turkey, thus promotional work, sustainability activity, use of nanotechnology in business will be there and this process will help in any sort of business innovation and advancement.   

Legal:

The judiciary system segmentation is the major process of Cyprus to consolidate their law and regulation. There are Supreme Court, District court, Assize courts, Family courts, Rent control courts, and Administrative court. The status of EU and their regulation is maintained in Cyprus. The unification of government and the accession is the major legal procedure maintained by the nation (Hadjikoumis et al. 2017). Legislative power is drilled by the government and parliament and the executive legislature is independent in nature and it controlled by the judiciary system.

Environment:

Reservation orders of Town and Country Planning Law of 1972 and the protection of heritage places like buildings, trees, forest and other restrict points are covered by that initiative. The coastal business advancement and the make a concerned outlook for erosion, agriculture and natural resources are the prime environmental protection that Cyprus does to save the foreshow protection law (Hadjimitsis et al. 2016).

Strengths · Strong knowledge of hairdressing · New playground theme for children · Large range of service · Extended opening hours during a special occasion · Excellent customer experience · Good location · Price range is affordable	Weaknesses · The flexibility of staffs working hour · Financial capacity · Only for kids · Lack of capacity for high numbers of visiting · Not having experience in internet marketing
Opportunities · Development of packages · Strong marketing growth · Good opportunities in the market · The stock of organic product for children · Male and female experts	Threats · Home visit stylists · New salon in the area · Discount of competitors · Cost of having the best technologies

Objective 1:

Specific	To attain a market share of 5% within two years of business
Measurable	This objective can be measured by calculating the revenue and profitability of the organisation, the organisation can also measure the sales percentage of other competitors
Attainable	This objective can be attained by increasing the sales and promotions
Realistic	This objective is realistic as it will help to get a large customer base
Time-bound	By the end of 2021

Objective 2:  

Specific	To open two new salons in Nicosia and Limassol in the next two years
Measurable	This objective can be measured by the progress of opening the salons
Attainable	This objective can be attained by taking the initiative to open the salons and by recruiting new staffs
Realistic	This objective is realistic as the organisation can open up for new customers and the population is overall low in Cyprus
Time-bound	By the end of 2021

4.1 Segmentation

Demographic: Parents’ are the main target market for the demographic segmentation. Kinder Salon targets the parents of children age group 2 to 14 years. Age group of 2-7 years need special attention and the playground is mainly used for that reason.	Behavioural: Grouping of customers and their service taking process is the main segmentation in that case. The loyalty of customers, user status, occasional timings, and regular customers are the main distribution in this case (Michael and Antoniou 2018). The loyal customers need some effective innovation from the company and Kinder Salon needs to provide those.
Psychographic Customer personality, trait, values and lifestyle all these are considered in the psychographic process. Upper-middle-class people are the target market for Kinder Salon (Michael and Antoniou 2018). The people who are very much worried about their child hair cutting will access the process as efficient employees are allocated for the job.	Geographic Larnaca is in the southern coast of Cyprus. The riverside areas are covered environment beauties. The people are well off in this city and they can afford the bill required for the hair cutting. The area is good for business in terms of assimilation of foreign people they have the good opportunity in business as well.

4.2 Targeting 

The primary target market of Kinder Salon will be upper-middle class parents of the children aged between 2 and 14. The people, who are working with Kinder Salon, are efficient enough to deal with children. Parents’, those become anxious while their children cut hair and hairstyle, will find optimum relax in Kinder Salon. The treatment is the high standard and all the facilities for children to convince them, present in the Kinder Salon.

Kinder Salon will be positioned in the market based on the quality of hairdressing for the children as the organisation wants to avoid the price competition. Kinder Salon will also be position in the market by providing convenience to the children as customers gravitate towards good service which makes life easier. The location of the salon is perfect and usability of the salon will ease up the lives of the parents who are anxious for their children during a haircut. Therefore, the positioning strategy of Kinder Salon will be high quality and low price. Kinder Salon will offer diverse hairstyles to the children with activities along with support experts in hairdressing which can maximise the investment in the salon. Positioning statement of Kinder Salon will be focusing more on targeting the children and marketing directly to the audiences.

4.4 Competitors’ analysis 

Economic

Rivalry among the salon is high in Larnaca, Cyprus as there are many salons already existed. These salons have their own loyal customers who visit the customers. Kinder Salon will have the differentiation in the market as it will provide the children playground and fun activities during the haircut session. Rivalry among the existing customers is high due to the large numbers of the cheap salon are already present in the market. In addition, the threat of new entrant in Cyprus is high as the salon does not need large investment and the Cyprus Government is helpful to open the business (Cyprus-mail.com 2018). The threat of substitute in the market is medium as Kinder Salon will provide a different type of salon experience to the customers. Bargaining power of customers is also high as the customers have switching power and price sensitivity. Some of the competitors’ of Kinder Salon will be Body and Soul Beauty Salon, Larnaca Hair and Beauty Salon, Tony and Guy, Hair Heaven and Backstage Hair Salon.

Name of salons	Strengths	USP
Tony and Guy	This is one of the oldest salons and has its own customer base	This is special for the children haircut
Larnaca Hair and Beauty Salon	This salon offers hairstyling and haircut for children and for the adult’s women also	It is a large salon and experts are trained
Hair Heaven	It is a small barbershop and cheap. Have a large customer base	The place is very crowded and rating in online is also high.

Kinder Salon will offer high-quality hairdressing experience to the children at a competitive price. Kinder Salon will offer quality haircut from best experts. The price of the service will keep competitive and low; therefore, large numbers of parents will bring their children to Kinder Salon. Low-cost leadership in the market increase the market share in the industry and it also improves the profit margin as large numbers of customers visit the stores (Hu et al. 2016). Kinder Salon will keep the price competition in order to use penetration pricing in the industry. The competitive advantage of the organisation will be lower pricing and high-quality service in the industry. The customers will have better prices from Kinder Salon.

Kinder Salon will have the competitive advantage by its unique service experience to the children who will have playground and fun activities during the hairstyling and haircut sessions. Kinder Salon differentiates the service by providing fun activities and playground. This differentiation will allow the salon to have large numbers of new footfall each day as the parents will bring their children to the salon. Differentiation in the market will help the organisation to reduce the competitive rivalry and it will also help to stop the entry of the competitors in the market (Brain Cruz et al. 2015). Kinder Salon will have the negligible threat of the service substitutes.

Product or Service: Kinder Salon offers children hairdressing and stylish haircut. Kinder Salon will also offer the hairstyling, colour and haircut to the children during occasion, events and general purposes. Most importantly, Kinder Salon is going to mitigate the issue of the parents as the parents feel anxiety when they take their children to the salon. Kinder Salon will serve the children and teens aged between 2 and 14. Kinder Salon will also have male and female experts. This new salon will have a playground where the children can enjoy and the salon will also have a library where the children can read books. The customers have to take the appointment before they visit the salon.

Social

Price:  Kinder Salon will take the low-pricing strategy after they start their business in Cyprus. Kinder Salon will charge less from the customers in the beginning stage so that they can increase the market share. Lower pricing strategy in the industry will play the role of penetration pricing in order to have the large customer base (Vergas-Hernandez 2016). Kinder Salon will set the price lower than the competitors to do the hairstyling and haircutting of the children. The parents will see the advantage of lower price and additionally, the children can enjoy their time being in the salon.

Place: Kinder Salon will start their journey from opening its first salon in Larnaca, Cyprus. The political condition of Cyprus is not stable at present; however, the organisation is thinking to roll on their business in different cities in future. Larnaca city is located on the Southwest coast of Cyprus and it is the third largest cities in Cyprus (Larnaca.com 2018). The city is beautiful and the population at present is 51, 400. 

Promotion: Kinder Salon will start their promotions through social media network like Facebook and Twitter. Kinder Salon will open their business page on social media network where they will post content and images to attract the customers. Kinder Salon will advertise on Facebook and Twitter to allure the parents of the children. Social media network will start the campaign to attract the customers. Apart from social media, Kinder Salon is thinking of doing PPC and SEO on the online platform.

OOH (Out-of-home) promotions will also be done by Kinder Salon as the firm is thinking to promote their business by providing billboards and hoarding near Larnaca city. This outdoor marketing will help the organisation to know about the salon.  

Discount pricing strategy will help Kinder Salon to increase the footfall. Kinder Salon will offer discount pricing for first-five visits of the customers. The management of Kinder Salon is thinking of membership card for the children.

Summary Statement
Sources of Capital
Owners’ and Other Investments	€ 85,000
Bank Loans	€11,500
Other Loans	–
Total Source of Funds	€96,500
Startup Expenses
Social Media	68,650
SEO	12,050
Mobile Marketing	25,000
Google Adwords	8,500
Out-of-home advertising	20,000
Advertising / Promo Expenses	7,000
Other Expenses	50,000
Total Startup Expenses	€384,200

		Year 1 (2019)	Year 2 (2020)	Year 3 (2021)
Gross revenue		€ 2,688,000	€ 2,741,760	€ 2,851,430
Cost of goods sold		€ 196,875	€ 200,813	€ 208,845
Gross margin		€ 2,491,125	€ 2,540,948	€ 2,642,585
Other revenue [source]		€ 0	€ 0	€ 0
Interest income		€ 0	€ 0	€ 0
Total revenue		€ 2,491,125	€ 2,540,948	€ 2,642,585
Sales and marketing		€ 7,000	€ 7,140	€ 7,426
Payroll and payroll taxes		€ 50,000	€ 51,000	€ 53,040
Depreciation		€ 25,140	€ 25,643	€ 26,146
Maintenance, repair, and overhaul		€ 0	€ 0	€ 0
Total operating expenses		€ 82,140	€ 83,783	€ 86,611
		€ 2,408,985	€ 2,457,165	€ 2,555,974
Interest expense on long-term debt		€ 0	€ 0	€ 0
		€ 2,408,985	€ 2,457,165	€ 2,555,974
Loss (gain) on the sale of assets		€ 0	€ 0	€ 0
Other unusual expenses (income)		€ 0	€ 0	€ 0
		€ 2,408,985	€ 2,457,165	€ 2,555,974
	30%	€ 722,696	€ 737,149	€ 766,792
		€ 1,686,290	€ 1,720,015	€ 1,789,182

Cash Flow

		Year 1	Year 2	Year 3
Operating activities
	Net income	€ 0	€ 0	€ 0
	Depreciation	€ 25,140	€ 25,643	€ 26,146
	Accounts receivable	€ 0	€ 0	€ 0
	Inventories	€ 0	€ 0	€ 0
	Accounts payable	€ 0	€ 0	€ 0
	Amortization	1,000,000	1,000,000	€ 1,000,000
	Other liabilities	50,000	50,000	€ 50,000
	Other operating cash flow items	150,000	150,000	€ 150,000
	Total operating activities	€ 1,225,140	€ 1,225,643	€ 1,226,146
Investing activities
	Capital expenditures	€ 0	€ 0	€ 0
	Acquisition of business	0	0	0
	Sale of fixed assets	(€ 722,696)	(€ 737,149)	(€ 766,792)
	Other investing cash flow items	0	0	0
	Total investing activities	(€ 722,696)	(€ 737,149)	(€ 766,792)
Financing activities
	Long-term debt/financing	(€ 11,500)	€ 0	€ 0
	Preferred stock	500	500	500
	Total cash dividends paid	5,000	5,000	5,000
	Common stock	0	0	0
	Other financing cash flow items	0	0	0
	Total financing activities	(€ 6,000)	€ 5,500	€ 5,500
Cumulative cash flow	€ 496,445	€ 493,993	€ 464,853
Beginning cash balance	€ 0	€ 496,445	€ 990,438
Ending cash balance	€ 496,445	€ 990,438	€ 1,455,291

The business plan can be measured by making tie this with the strategic objective of the business. The business plan is simple and this business can be controlled by keeping only a few departments within the salon. The staffs’ performance dashboard must be tracked with KPIs. The management will maintain up-to-date data so that they can establish in the market.

Reference List and Bibliography

Barin Cruz, L., Boehe, D.M. and Ogasavara, M.H., 2015. CSR-based differentiation strategy of export firms from developing countries: An exploratory study of the strategy tripod. Business & Society, 54(6), pp.723-762.

Technological

Charalambous, G., 2014. Political Culture and Behaviour in the Republic of Cyprus during the Crisis. Nicosia: PRIO Publications.

Dalborg, C., von Friedrichs, Y. and Vincent, J., 2015. Risk perception matters: why women’s passion may not lead to a business start-up. International Journal of Gender and Entrepreneurship, 7(1), pp.87-104.

Giannakis, E., and Mamuneasb, T. P. 2018. Sectoral linkages and economic crisis: An input-output analysis of the Cypriot economy. Cyprus Economic Policy Review, 12(1), pp.28-40.

Hadjikoumis, A., Croft, P., Simmons, A., Guilaine, J., Peltenburg, E., Todd, I., Le Brun, A. and Vigne, J.D., 2017, May. A first glimpse into butchery practices in Pre-Pottery Neolithic Cyprus: Evidence on sheep and goat remains from six sites. In Nouvellesdonnéessur les débuts du Néolithique à Chypre. 9, pp. 199-213.

Hadjimitsis, D.G., Agapjou, A., Themistocleous, K., Cuca, B., Nisantzi, A., Lasaponara, R., Nolè, G., Tucci, B., Masini, N., Krauss, T. and Cerra, D., 2016. Athena: center of excellence in Cyprus in the field of remote sensing for cultural heritage in the areas of archaeology and cultural heritage. International Journal. 2(3), pp.23-34.

Hu, C., Lin, S., Li, W., Sun, H., Chen, Y., Chan, C.W., Leung, C.H., Ma, D.L., Wu, H. and Ren, K., 2016. A one-step strategy for ultra-fast and low-cost mass production of plastic membrane microfluidic chips. Lab on a Chip, 16(20), pp.3909-3918.

Inman, K., 2016. Women’s resources in a business start-up: A study of black and white women entrepreneurs. Routledge.

I??n, A., Direko?lu, C. and ?ah, M., 2016. Review of MRI-based brain tumor image segmentation using deep learning methods. Procedia Computer Science, 102, pp.317-324.

Larnaca city. 2018. Available at: https://www.larnaca.com/v/city-info/ {accessed 7^th Nov 2018]

Mayer, A.S., Brazile, W.J., Erb, S., Autenrieth, D.A., Serrano, K. and Van Dyke, M.V., 2015. Developing effective worker health and safety training materials: hazard awareness, identification, recognition, and control for the salon industry. Journal of occupational and environmental medicine, 57(5), pp.537-542.

Michael, K. and Antoniou, G., 2018. [P115] I-131 Patient release criteria based on dose rate measurements at the bank of cyprus oncology centrecyprus (BOCOC). PhysicaMedica: European Journal of Medical Physics, 52, p.133.

Salon in Cyprus. 2018. Available at: https://cyprus-mail.com/2016/02/05/all-you-need-for-your-spa-and-salon-business/ [Accessed 7^th Nov 2018]

Savvides, S. C. 2016. Overcoming Private Debt: Unblocking and Rebuilding the Loan-Burdened Real Economy in Cyprus. The Journal of Private Equity, pp.51-59.

Tsangas, M., Zorpas, A.A., Jeguirim, M. and Limousy, L., 2018, March. Cyprus energy resources and their potential to increase sustainability. In Renewable Energy Congress (IREC), 2018 9th International (pp. 1-7). IEEE.

Vargas-Hernández, J.G., 2016. Strategic-Spatial Analysis of the Implementation of Business Opening Politics of Mexico. In Handbook of Research on Global Indicators of Economic and Political Convergence (pp. 274-313). IGI Global.

White, H., Khan, K., Lau, C., Leung, H., Montgomery, D. and Rohlman, D.S., 2015. Identifying health and safety concerns in Southeast Asian immigrant nail salon workers. Archives of environmental & occupational health, 70(4), pp.196-203.