Discount Card Business Plan [Sample Template]

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A discount card business involves distributing cards offering special deals or discounts at partnered businesses. These cards, often sold or provided through memberships, grant consumers access to exclusive savings for a specified period.

The company forms collaborations with various businesses, spanning restaurants, retailers, and service providers, which agree to provide discounts to cardholders.

Successful operations of the discount card business hinge on effective marketing, offering diverse and appealing discounts, and ensuring seamless card usage.

Some businesses incorporate technology for tracking usage patterns and customer behavior. The model may include subscription-based services, requiring renewal efforts to maintain customer engagement and loyalty.

Overall, the business aims to provide cost-effective shopping options while fostering partnerships with a range of establishments.

Steps on How to Write a Discount Card Business Plan

Executive Summary

Sam Jefferson® Discount Card Company, Inc. in Burlington, Vermont, operates as a premier provider of discount cards, offering consumers exclusive access to savings at partnered businesses.

Our business model focuses on forming strategic collaborations with diverse establishments, including restaurants, retailers, and service providers, to secure attractive discounts for cardholders.

We employ a subscription-based membership system, granting customers continuous access to cost-effective shopping options.

Our commitment to effective marketing, technological tracking of card usage, and a variety of appealing discounts sets us apart.

Located in the vibrant community of Burlington, we strive to enhance the local economy by connecting consumers with businesses.

Sam Jefferson® Discount Card Company, Inc. aims to be the go-to source for savvy shoppers seeking value and convenience.

Company Profile

a. Our Products and Services

Sam Jefferson® Discount Card Company, Inc. in Burlington, Vermont, offers a range of products and services designed to provide value and savings to both consumers and local businesses:

Discount Cards:

We provide physical and digital discount cards to consumers.
These cards grant access to exclusive discounts and special promotions at a variety of local businesses.

Membership Subscriptions:

Customers can opt for membership subscriptions, receiving ongoing access to a diverse array of discounts for a specified period.

Strategic Business Partnerships:

We establish and maintain partnerships with local businesses, including restaurants, retailers, entertainment venues, and service providers.
Partnered businesses offer special deals to our cardholders, enhancing customer loyalty and driving traffic to their establishments.

Sam Jefferson® Discount Card Company, Inc. is dedicated to facilitating cost-effective shopping experiences for consumers while fostering strong, mutually beneficial relationships with our local business partners in the Burlington, Vermont community.

b. Nature of the Business

Sam Jefferson® Discount Card Company, Inc. operates through a multi-faceted business model. We will work with the government, businesses, corporate organizations, and individuals.

c. The Industry

Sam Jefferson® Discount Card Company, Inc. will operate in the service industry, specifically within the realm of marketing services and consumer loyalty programs.

d. Mission Statement

At Sam Jefferson® Discount Card Company, Inc., our mission is to empower consumers with affordable and enriching shopping experiences while fostering thriving connections with local businesses.

We are dedicated to delivering unparalleled value through our discount cards, creating a win-win scenario that enhances community engagement and drives economic growth in Burlington, Vermont.

e. Vision Statement

Our vision at Sam Jefferson® Discount Card Company, Inc. is to be the premier catalyst for community-driven savings, creating a vibrant ecosystem where consumers and local businesses mutually thrive.

We aspire to continually expand our network of strategic partnerships, leveraging technology and innovation to redefine the landscape of discount offerings.

By doing so, we aim to be the go-to resource for cost-effective and fulfilling commerce experiences, leaving a lasting positive impact on the Burlington community and beyond.

f. Our Tagline (Slogan)

Sam Jefferson® Discount Card Company, Inc. – “ Empowering Savings, Enriching Communities”

g. Legal Structure of the Business (LLC, C Corp, S Corp, LLP)

Sam Jefferson® Discount Card Company, Inc. will be formed as a Limited Liability Company (LLC).

h. Our Organizational Structure

Chief Operating Officer (Owner)
Chief Financial Officer
Operation Manager
Technical Officer
Business Development Officer
Customer Service Representatives

i. Ownership/Shareholder Structure and Board Members

Sam Jefferson (Owner and Chairman/Chief Executive Officer) 56 Percent Shares
Rowe McCains (Board Member) 14 Percent Shares
Kim Morgan (Board Member) 10 Percent Shares
Cyril Michael (Board Member) 10 Percent Shares
Jessica Pope (Board Member and Secretary) 10 Percent Shares.

SWOT Analysis

a. Strength

Established Local Presence in Burlington, Vermont.
Diverse Network of Partnerships with Local Businesses.
Innovative Use of Technology for Data Analytics.
Strong Brand Recognition and Customer Loyalty.
Experienced Leadership Team.

b. Weakness

Reliance on Local Economy and Market Conditions.
Potential Dependency on Key Business Partners.
Limited Geographic Reach Beyond Burlington.
Need for Continuous Marketing to Sustain Customer Interest.
Vulnerability to Economic Downturns.

c. Opportunities

Expansion into New Markets and Cities.
Introducing New Membership Tiers and Features.
Collaboration with National Brands for Wider Reach.
Leveraging Social Media and Influencer Marketing.
Offering Digital-First and Mobile App Solutions.

i. How Big is the Industry?

The discount card industry is a big and growing industry. Available data shows that the market size crossed USD 1.8 trillion in 2022 and is projected to witness a 15.5% CAGR from 2023 to 2032.

ii. Is the Industry Growing or Declining?

The discount card industry has witnessed substantial growth in recent years, reflecting consumer demand for cost-effective shopping solutions.

Valued at billions of dollars globally, the industry’s size is attributed to the prevalence of discount programs across various sectors, including retail, dining, and services.

The proliferation of digital platforms and mobile apps has further expanded the industry’s reach, making discounts more accessible to a broader audience.

Key players in the sector continue to innovate, introducing loyalty programs, exclusive partnerships, and personalized offerings.

As consumers increasingly prioritize value, the discount card industry is poised for continued expansion and evolution, shaping the landscape of modern consumer commerce.

iii. What are the Future Trends in the Industry?

Continued growth in digital discount platforms and mobile apps offers convenient and instant access to discounts, loyalty programs, and personalized offers.

Collaboration with online retailers and e-commerce platforms to provide a seamless integration of discounts for both online and offline shopping experiences.

Expansion of subscription-based discount services provides consumers with ongoing access to a variety of discounts in exchange for a recurring fee.

Growing emphasis on sustainable and socially responsible practices, with discount card programs aligned with environmentally friendly initiatives and contribute to social causes.

Introduction of creative loyalty programs, such as gamification elements, challenges, and exclusive events enhance customer engagement and retention.

Larger discount card companies may expand their reach to international markets, offering discounts on a global scale and forming partnerships with businesses worldwide.

Incorporation of Augmented Reality (AR) Experiences to enhance user experience, allows customers to visualize products or access location-based discounts through AR applications.

iv. Are There Existing Niches in the Industry?

No, there are no existing niches when it comes to a discount card business because the discount card business is a niche idea in the insurance industry.

v. Can You Sell a Franchise of Your Business in the Future?

Sam Jefferson® Discount Card Company, Inc. will not sell franchises in the near future.

d. Threats

Competitive Pressure from Similar Discount Programs.
Economic Instability Impacting Consumer Spending.
Shifting Consumer Trends and Preferences.
Regulatory Changes Affecting Loyalty Programs.
Technological Disruptions in the Retail Sector.

i. Who are the Major Competitors?

Groupon
RetailMeNot
Entertainment®
LivingSocial
AAA Discounts
AARP Member Discounts
Rakuten
ID.me
Honey
Student Beans
UNiDAYS
Veterans Advantage
Senior Discounts Club
GoodRx
Slickdeals
CouponCabin
Dosh
DealNews
Swagbucks
Cardpool

ii. Is There a Franchise for the Discount Card Business?

No, there are no franchise opportunities for discount card business.

iii. Are There Policies, Regulations, or Zoning Laws Affecting the Discount Card Business?

Yes, there are several policies, regulations, and zoning laws that can affect the discount card business in the United States.

Discount card is a highly regulated industry, primarily at the state level, and these regulations are in place to protect consumers and ensure the integrity of the business.

Discount card businesses, like any other business, may need to obtain the necessary licenses and permits to operate legally. These requirements can vary at the state and local levels.

Discount card businesses must adhere to federal and state consumer protection laws. These laws govern fair business practices, advertising, and the disclosure of terms and conditions to consumers.

Advertising discount offers and promotions may be subject to specific regulations to ensure transparency and prevent deceptive practices. Businesses must comply with truth-in-advertising laws at the federal and state levels.

If the discount card business collects and handles customer data, it must comply with relevant privacy laws, such as the federal Children’s Online Privacy Protection Act (COPPA) or state-specific data protection regulations. The agreements between discount card businesses and their partner establishments must comply with contract law.

Zoning laws are generally more relevant to the physical location of businesses. Discount card businesses that operate physical storefronts or offices may need to comply with local zoning regulations.

Regulations and laws can evolve, so staying informed about any changes in federal, state, or local legislation is important for compliance.

Consulting with legal professionals or industry associations can provide the most current and accurate guidance on regulatory matters affecting discount card businesses.

Marketing Plan

a. Who Is Your Target Audience?

i. Age Range:

Primarily adults aged 25 to 55, encompassing working professionals, parents, and individuals in the peak of their spending years.

ii. Level of Education:

Varied, but generally individuals with at least a high school education, including those with college degrees or vocational training.

iii. Income Level:

Middle to upper-middle-income households, with disposable income for discretionary spending and a focus on seeking value for their purchases.

iv. Ethnicity:

Diverse, aiming to cater to a broad range of ethnic backgrounds reflective of the local community and beyond.

v. Language:

English-speaking primarily, but efforts are made to accommodate diverse language preferences, especially in areas with multilingual communities.

vi. Geographical Location:

Initially focused on Burlington, Vermont, with potential expansion into neighboring areas and cities as the business grows.

vii. Lifestyle:

Individuals who value cost savings without compromising quality, seeking a balance between work and leisure. This includes both urban and suburban dwellers who engage in a mix of online and in-person shopping experiences.

b. Advertising and Promotion Strategies

Use FOMO to Run Photo Promotions.
Share Your Events in Local Groups and Pages.
Turn Your Social Media Channels into a Resource
Host Themed Events That Catch Attention.
Tap Into Text Marketing.
Develop Your Business Directory Profiles
Build Relationships with Other Businesses in our Area

i. Traditional Marketing Strategies

Broadcast Marketing -Television & Radio Channels.
Marketing through Direct Mail.
Print Media Marketing – Newspapers & Magazines.
Out-of-Home” marketing (OOH marketing) – Public Transit like Buses and Trains, Billboards, Street Furniture, and Cabs.
Including direct sales, direct mail (postcards, brochures, letters, fliers), tradeshows, print advertising (magazines, newspapers, coupon books, billboards), referral (also known as word-of-mouth marketing), radio, and television.

ii. Digital Marketing Strategies

Social Media Marketing Platforms.
Influencer Marketing.
Email Marketing.
Content Marketing.
Search Engine Optimization (SEO) Marketing.
Pay-per-click (PPC).
Affiliate Marketing
Mobile Marketing.

iii. Social Media Marketing Plan

Create a personalized experience for our customers.
Create an efficient content marketing strategy.
Create a community for our audience.
Start using chatbots.
Gear up our profiles with a diverse content strategy.
Use brand advocates.
Create profiles on the relevant social media channels.
Run cross-channel campaigns.

c. Pricing Strategy

Our pricing strategy at Sam Jefferson® Discount Card Company, Inc. aligns with our business goals, competitive landscape, and the value we provide to our clients, and they are as follows:

Cost-Plus Pricing
Value-Based Pricing
Competitive Pricing
Dynamic Pricing
Bundle Pricing

Please note that our pricing strategy is based on a careful analysis of the costs and profitability of the business, as well as the needs and preferences of the target customer base.

Sales and Distribution Plan

a. Sales Channels

Sam Jefferson® Discount Card Company, Inc. employs a multichannel sales approach to maximize accessibility for our customers.

Our primary sales channels include online platforms, where customers can purchase digital discount cards through our user-friendly website and mobile app. We leverage e-commerce partnerships and collaborate with local businesses to expand our digital reach.

Additionally, we maintain a physical presence through select retail partners and pop-up events in the Burlington area, providing an in-person option for customers.

Our comprehensive marketing strategy encompasses social media, email campaigns, and collaborations with influencers to drive sales.

By diversifying our sales channels, we ensure a seamless and convenient experience for our customers while maximizing our market presence.

b. Inventory Strategy

Sam Jefferson® Discount Card Company, Inc. implements a dynamic inventory strategy focused on adapting to customer preferences and seasonal demands.

Our digital platform allows for real-time tracking of card usage and popular discounts, enabling us to adjust inventory levels and partnerships accordingly. We continually assess market trends and consumer behavior to anticipate shifts in demand.

Collaborating closely with businesses in our network, we ensure a diverse array of discounts that align with customer needs.

This agile approach minimizes excess inventory and maximizes the value we offer to both customers and business partners. Additionally, we maintain a responsive customer feedback system to promptly address emerging trends.

c. Payment Options for Customers

Online Payment Portal
Credit and Debit Cards
ACH Bank Transfers
Electronic Funds Transfer (EFT)
Check Payments
Wire Transfers
Mobile Payment Apps.

d. Return Policy, Incentives and Guarantees

Return Policy:

At Sam Jefferson® Discount Card Company, Inc., we are committed to customer satisfaction. If a customer is dissatisfied with their purchase, we offer a hassle-free return policy.

Digital discount cards must be returned within a specified timeframe, and physical cards must be returned unused and in their original condition. Refunds are processed promptly, ensuring a positive customer experience.

Incentives:

We offer exclusive discounts, early access to promotions, and special perks for subscribers. Referral incentives are also in place, rewarding customers who refer friends or family, fostering a sense of community and shared savings.

Guarantees:

We stand behind the value of our discount cards. Sam Jefferson® Discount Card Company guarantees that cardholders will receive the specified discounts and promotions from our partner businesses.

If any issues arise, our customer support team is dedicated to resolving them promptly, ensuring our customers always experience the promised value.

e. Customer Support Strategy

We will provide multiple communication channels for customers to reach out, including phone, email, and a dedicated customer support portal on our website.

We will maintain extended business hours to accommodate customer inquiries and concerns outside regular working hours. Train our customer support team to be knowledgeable about discount cards, local regulations, and our company’s services.

Strive for prompt response times to customer inquiries, aiming to acknowledge and address their concerns within a reasonable timeframe.

Develop and maintain a comprehensive FAQ section on our website to provide answers to common customer questions.

Operational Plan

Sam Jefferson® Discount Card Company, Inc. executes a strategic operational plan to ensure seamless and efficient business functions.

Our core focus lies in establishing and nurturing partnerships with local businesses, negotiating exclusive discounts, and expanding our network.

Leveraging cutting-edge technology, we track and analyze customer behavior and card usage, allowing us to adapt our offerings in real-time.

Our marketing efforts encompass both digital and traditional channels to maximize reach and customer acquisition. Robust customer support ensures satisfaction, and our agile inventory management minimizes excess stock.

Regular training programs keep our team informed and engaged, fostering a dynamic work environment. As we expand from Burlington, Vermont, our operational plan remains flexible, positioning us for sustained growth and community impact.

a. What Happens During a Typical Day at a Discount Card Business?

A typical day at Sam Jefferson® Discount Card Company, Inc. involves a dynamic blend of activities. Our team initiates the day by engaging with local businesses to forge and strengthen partnerships, ensuring a diverse array of exclusive discounts.

The technology team continuously monitors and optimizes our digital platform for an enhanced user experience. Marketing efforts span social media, email campaigns, and collaborations with influencers to amplify our reach.

Collaboration with retail partners and hosting events in the local community adds a personal touch. Daily operations reflect our commitment to delivering unparalleled value, fostering community connections, and driving the success of Sam Jefferson® Discount Card Company, Inc.

b. Production Process

There is no production process.

c. Service Procedure

At Sam Jefferson® Discount Card Company, Inc., our service procedure is designed for customer convenience and satisfaction.

It commences with user-friendly online platforms, where customers can seamlessly browse, purchase, and activate their digital discount cards.

Our membership program ensures ongoing value, with exclusive perks and discounts. Customer support operates efficiently, promptly addressing inquiries and ensuring a positive experience.

Continuous engagement through email updates and social media keeps customers informed about the latest discounts and promotions.

Our service procedure is underpinned by a commitment to excellence, innovation, and providing unparalleled savings to our valued customers.

d. The Supply Chain

Sam Jefferson® Discount Card Company, Inc. maintains an agile and efficient supply chain to ensure the seamless delivery of our discount cards.

Collaborating closely with our partner businesses, we negotiate exclusive deals and discounts, optimizing the value we offer to customers.

Our digital platform allows for real-time tracking of card usage, enabling us to adapt our inventory and partnerships dynamically.

Physical card distribution is streamlined through strategic alliances with local retailers and participation in community events.

Regular communication with our network ensures a steady and diverse supply of discounts, aligning with market trends and customer preferences.

This agile supply chain approach positions us to respond swiftly to changing demands, providing continuous value to our customers.

e. Sources of Income

Sam Jefferson® Discount Card Company, Inc. generates income through the sale of physical and digital discount cards.

Revenue is driven by direct card sales to consumers, including one-time purchases and subscription-based memberships. Additionally, collaborations with local businesses contribute to income through partnership fees.

Our diverse income streams, including subscription renewals and strategic partnerships, sustain the company’s financial health while delivering consistent value to both customers and businesses in the Burlington, Vermont community.

Financial Plan

a. Amount Needed to Start your Discount Card Company Business?

Sam Jefferson® Discount Card Company, Inc. would need an estimate of $3.5 million to successfully set up our discount card company in the United States of America. Please note that this amount includes the salaries of all the staff for the first month of operation.

b. What are the Costs Involved?

Business Registration Fees – $750.
Legal expenses for obtaining licenses and permits – $2,300.
Marketing, Branding, and Promotions – $5,000.
Business Consultant Fee – $2,500.
Insurance – $25,400.
Rent/Lease – $150,000.
Other start-up expenses including, commercial satellite TV subscriptions, stationery ($500), and phone and utility deposits ($2,800).
Operational Cost (salaries of employees, payments of bills et al) – $250,000
Working Capital – $2.8 million
Store Equipment (cash register, security, ventilation, signage) – $4,750
Website: $600
Opening party: $3,000
Miscellaneous: $2,000

c. Do You Need to Build a Facility? If YES, How Much Will It Cost?

Sam Jefferson® Discount Card Company, Inc. will not build a new facility for our discount card company.

d. What are the Ongoing Expenses for Running a Discount Card Business?

Ongoing expenses for advertising, online promotions, influencer collaborations, and other marketing efforts to attract and retain customers.
Costs related to maintaining and updating the digital platform.
Fees paid to partner businesses for participating in the discount card program.
Salaries, software, and infrastructure costs associated with providing responsive customer support to address inquiries, concerns, and feedback.
Ongoing expenses for day-to-day operations, including rent, utilities, office supplies, and administrative staff salaries.
Costs related to managing and updating the inventory of discount offerings, including negotiating new deals with businesses and adjusting existing partnerships.
Investments in cybersecurity measures to protect customer data and ensure the secure functioning of the digital platform.
Ongoing training programs to keep employees informed about the latest industry trends, customer service techniques, and technology updates.
Expenses associated with managing and promoting subscription-based membership programs.
Costs for legal services to ensure compliance with relevant laws and regulations, protecting the business from legal issues and disputes.

e. What is the Average Salary of Your Staff?

Chief Operating Officer (Owner) – $125,000 Per Year
Chief Financial Officer – $100,000 Per Year
Operations Manager – $85,000 Per Year
Technical Officer – $70,000 Per Year
Business Development Officer – $55,000 Per Year
Customer Service Representative – $34,100 Per Year

f. How Do You Get Funding to Start a Discount Card Business?

Raising money from personal savings and sale of personal stocks and properties
Raising money from investors and business partners
Sell shares to interested investors
Applying for a loan from your bank/banks
Pitching your business idea and applying for business grants and seed funding from the government, donor organizations, and angel investors
Source for soft loans from your family members and friends.

Financial Projection

a. How Much Should You Charge for your Product/Service?

Direct Card Sales:

One-Time Purchases: Prices for individual discount cards can range widely. They might be priced at a fixed amount (e.g., $20 per card) or could vary based on factors like the duration of validity or the range of discounts offered.
Subscription-Based Memberships: Subscription fees can vary from a few dollars per month to annual plans that might be more cost-effective for customers.

Partnership Fees:

Businesses partnering with the discount card program may be charged a fee to participate. The cost can vary depending on factors such as the size and popularity of the discount card program, the demographics of its customer base, and the perceived value of the partnership.

Royalties or Commissions:

Some discount card businesses may negotiate a percentage-based commission on sales generated through their platform. This could range from a fixed percentage (e.g., 5% of each sale) to a tiered structure based on performance.

Advertising Revenue:

If the discount card business offers digital platforms, businesses may pay for premium placement or featured advertising. Prices for such features can vary based on factors like visibility, location within the app or website, and the overall reach of the discount card program.

Subscription Renewals:

Subscription renewal fees for customers are typically consistent with the initial subscription fees. Businesses often offer incentives, such as discounted rates for annual renewals or additional perks, to encourage customers to renew their subscriptions.

b. Sales Forecast?

First Fiscal Year (FY1): $1 million
Second Fiscal Year (FY2): $2.5 million
Third Fiscal Year (FY3): $5.5 million

c. Estimated Profit You Will Make a Year?

Sam Jefferson® Discount Card Company, Inc. is projecting to make;

First Fiscal Year (FY1): (10% of revenue generated)
Second Fiscal Year (FY2): (15% of revenue generated)
Third Fiscal Year (FY3): (20% of revenue generated)

d. Profit Margin of a Discount Card Company Business

The profit margin of a discount card company business is not fixed. It could range from 10 percent to 20 percent depending on some unique factors.

Growth Plan

a. How do you intend to grow and expand? By opening more retail outlets/offices or selling a franchise?

Sam Jefferson® Discount Card Company, Inc. aims for strategic growth by expanding our geographical reach beyond Burlington, Vermont, into neighboring cities and regions.

We plan to diversify and strengthen our network of partnerships with local businesses, ensuring a broad spectrum of exclusive discounts for our cardholders.

Embracing digital innovations, we’ll enhance our online presence, optimize user experience, and explore mobile app advancements.

Aggressive yet targeted marketing campaigns, coupled with community engagement initiatives, will drive customer acquisition.

Continuous data analysis will guide adaptive strategies, ensuring sustained relevance and value. Sam Jefferson® Discount Card Company, Inc. is poised for organic, community-centric growth.

b. Where do you intend to expand to and why?

Sam Jefferson® Discount Card Company, Inc. plans to expand to

Austin, Texas
Boise, Idaho
Raleigh, North Carolina
Phoenix, Arizona
Nashville, Tennessee
Tampa, Florida
Denver, Colorado
Atlanta, Georgia
Seattle, Washington
Charlotte, North Carolina.

Internationally, we plan to expand to Canada.

The reason we intend to expand to these locations is the fact that available statistics show that the cities listed above have a growing retail market, making them potentially attractive markets for discount card businesses.

Exit Plan

Sam Jefferson® Discount Card Company, Inc. envisions an exit plan via a strategic merger or acquisition that maximizes shareholder value and ensures the continued success of our brand.

The plan involves attracting potential acquirers by showcasing our robust customer base, innovative technology, and a well-established network of partnerships.

We aim to position ourselves as an attractive investment by maintaining strong financials and continually expanding into new markets. Through negotiations, we will seek a merger or acquisition that aligns with our company values.