2010
PROJECT REPORT SUBMITTED TO: SUBMITTED BY:
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ACKNOWLEDGEM ENT Our special thanks to Madam Sadia who arranged an entrepreneur project work for us. The work is done under the supervision of our worthy teacher Madam Sadia who provided us with her kind guidance at each and every step whenever we felt difficulty and she made us capable of making this project report.
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INTRODUCTION TO PROJECT Executive Summary We completed this business feasibility report as our entrepreneurship project supervised by our worthy MADAM SADIA. As there are various famous and regional food items in Pakistan which have high demand in food markets all over Pakistan but they are not readily available in every region hence we decided to sell these food products to customers in Multan, Lahore & Islamabad firstly than we expand our business to all over the Pakistan. We completed this project with great effort and group coordination. We prepared business feasibility regarding different areas of business which include operations, human resource, marketing and finance. The explanation feasibility of each area is explained in this report. After completion of this project we concluded that the business is highly feasible and profitable.
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Selection of Project We selected this business as our project with the consent of our worthy madam and after several group discussions. One of the key success factor of this business in that it is very much innovative and is not there in the market in Pakistan.
Business Model The model of our business is the business to consumer model. This means that we will sell the products of famous food suppliers directly to customers.
Brand Name We decided the brand name for this business that is “SAUGHAAT”. We selected this brand name because this name represents and explain this business in a better way and it reflects our business as Saughaat is a word used for traditional, high quality and famous food items.
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Mission Statement “OUR MISSION IS TO ENHANCE ACCESSIBILITY OF FAMOUS FOOD ITEMS FOR PAKITANI”
Business Objectives The main objective of our business is to generate maximum profits by providing the people of Multan with the access to several traditional and famous food items from different regions of Pakistan. Other objectives could be providing employment opportunities, contributing to economic growth by enhancing sales of food item suppliers and courier services etc.
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PRODUCT LINE Our product line includes the following products at the start but new additions would be made after the business becomes operational. This would be done after examining the consumer needs and demands regarding food items. a.
SOHAN HALWA
MULTAN
b.
NIMKO
KARACHI
c. PAIRAY
MARDAN
d.
SPICES
HAIDERABAD
e.
PICKLE
SHIKARPUR
f.
REVRI
CHAKWAL
g.
DRY FRUIT
h.
BURFI
MIAN CHANNU
i.
DATES
BAHAWALPUR
j. MANGOES
PISHAWAR
SHUJJABAD/MULTAN
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OPERATIONAL PLANS
CUSTOMER RECEIVES FOOD ITEM AT HOME
COURIE R SERVICE C.S.R TAKES FOOD ITEMS AND SEND THEM TO CUSTOMER ADDRESSES THROUGH COURIER SERVICE
CUSTOM ER
1. CUSTOMER PLACES ORDERS ON WEB SITE 2.CUSTOMER PAYS THROUGH CREDIT CARD 3.PAYMENT TRANSFERRED TO BANK ACC.
CUSTOMER SUPPORT REPRESENT ATIVE .INSTRUCTIONS BY C.S.R TO SPECIFIED SALES REPRESENTATIV E
SALES REPRESENT ATIVE
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EXPLANATION Ordering procedure: Customer can order our food items by browsing our web site which could be www.saughaat.com.pk . The food items we are offering will be available on our web site with their prices and their specifications. Customers would be able to order for any item after few clicks on our website.
Payment procedure for customers: Customers can • Pay the bills by credit card • Pay with the help of Telenor Easy Paisa facility from any telenor franchise near to their location. •
In case of credit cards the payment would directly be transferred to the company’s bank account and top management would be able to access that account.
Customer’s order will be treated by the company: After the order has been placed by customer, he/she has provided required information on our web site and has paid the price for the ordered food item then the customer support representative will receive that order at
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our head office and will check that the information provided by the customer is sufficient or correct. After that the representative will send instructions to the sales representative about the number of items to be sent and the addresses of the customers. The sales representative will then contact the supplier.
Company delivers the products to the customers: After receiving instructions by the customer support representative from head office, the customer sales representative will take the food item in required quantity and will send that item to the customer’s address through courier service and the food item will be delivered to the customer within 1 or maximum of 2 days.
Location Feasibility As at the start our major focus would be on increasing brand image and sales promotions hence we would incur more costs on these activities. Hence at the start we will open our office in some cheap places in Multan, Islamabad & Lahore. For example in Mumtazabad Multan.
Other Organizational Involvements The organizations which will be involved in our operations are 1.Habib Bank Ltd (for credit card transactions and bank accounts)
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2.Telenor Easy Paisa (for payment by customer) 3.O.C.S (courier servive for delivery of food items)
ORGANIZATIONAL STRUCTURE: OPERATIO NS
OPERATIO NS DEPARTME NT OPERATIO NS MANAGER, ASST.
BANK (H.B.L. UBL,ALFALA H), COURIER SERVICES (OCS),
C.E.O
FINANCE DEPARTMEN T FINANCE MANAGER, ASST. MANAGER, ACCOUNTAN
REGIONAL FOOD SUPPLIERS (e.g HAFIZ SOHUN HALWA, MULTAN)
MARKETI NG &
MARKETING AND SALES DEPARTMENT MARKETING MANAGER, ASST. MANAGER, E.BUSINESS MARKETERS AND REGIONAL CUSTOMER SALES AGENTS AND REPRESENTA TIVES, CUSTOMER
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MARKETING PLAN WEBSITE PLAN: The following sub-topics outline our plans to create and maintain our website. At first, we will have a simple text and image-based website which outlines our products and redirects customers. After the first three months, we will begin online ordering via our own website as well.
Website Marketing Strategy Our website will provide information about us and our products as well as order processing to purchase our products online. We will include our web address in all of our advertising to reinforce to our customers how to find us online. Our company logo and motto will also need to be eye catching and easy to remember so that once our customers find us, they will remember us and suggest us to their friends and family.
Development Requirements Initial Development We will be working with an outside contractor to design the layout of the site. Initially, our site will provide an overview of the company, describe our products and services, and redirect visitors to our store to purchase a SAUGHAAT. The estimated costs for initial website development are listed in our start-up costs.
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Full website (including online ordering) In the third month of the plan, when we have a better sense of customer preferences, we will finish the development of the site to include online order processing. Once the website design is complete, we will contract for ongoing maintenance and support of the site.
TELEPHONIC PLAN: In this section we mentioned that how the customer can contact us through telephone channels.
Telephonic numbers: We need some contact numbers for a relationship with our customers. So there are many possible networks and numbers through which users can sms and make a call for business dealings. Here are some suggested numbers. 03333764428 03322764428 03003764428 03455764428 etc All above numbers have SOGHAT alphabets on the phone and mobile keypads by dialing 764428 which will make ease to remind our contact numbers. Ultimately make a business worthwhile.
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SMS Networking: We will affiliate our promotion with an SMS Networking with different telecom companies for the best achievement of our business goals.
OVERALL MARKETING STRATEGY: We are using both scope and differentiation strategy as there is no as such business already existing in the market and our service creates differentiation, moreover a scope strategy helps us focus different cities and we plan to expand our product line and target more segments in near future. Our goals are, • Providing an introduction to food items (options) for buyers in different cities. • Helping businesses with established recognition to enhance their sales. • Creating a time-efficient way to meet the requirements of many potential clients at once. • Maintain tight control on cost during expansion.
MARKET POTENTIAL: There is a strong market potential for our products as the target market is middle age to old age people. Sweet (sohun halwa, barfi, etc) are sold like hot cakes whenever the wedding season is at peak. So we see the great market potential for our products. We can grab a major market share from the customers all over Pakistan throughout different cities.
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PRODUCT PRICING: The product pricing is done as follows. The selling price of each product is approximately 100 or 120 percent more than its cost price including all the delivery charges etc.
PRODUCT LINE: 1
SOHAN HALWA
MULTAN
400/kg
2
NIMKO
KARACHI
300/kg
3
PAIRAY
MARDAN
350/kg
4
SPICES
HAIDERABAD
500/dzn.spices
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PICKLE
SHIKARPURA
500/800gm pack
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REVRI
CHAKWAL
375/kg
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MIX DRY FRUIT
PISHAWAR
1250/kg
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BURFI
MIAN CHANNU
500/kg
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DATES
BAHAWALPUR
550/5kg pack
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MANGO
SHUJABAD-MULTAN
1050/5kg
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DISTRIBUTION AND SALES Distribution channels: Our main distribution channels will be courier’s services which will cause both cost and time efficient for the delivery to the many cities and town of Pakistan.
Motivating the channel: We will encourage courier Service Company to pay an important attention to our orders. And we will also heir some part time employees such as students for some areas where we have some large number of orders on salary and commission bases.
Criteria for evaluating distributors: There will be criteria to evaluate the performance of our distributors to keep on rotating orders fast and efficient. If there are not fulfilling the criteria warnings will be there and for good work, a reward will be for the distributors.
Locations: We are going to target almost every possible place in Pakistan where Saughaat can approach directly through our courier service partners.
Logistics and order fulfillment:
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As we are online and telephonic system based dealers so there is no need for logistics, but order fulfillment is a key aim of business. Order fulfillment method is explained as above in marketing strategy under the head of website and telephonic plan.
PRODUCT DESCRIPTION: Products we are offering are the specialties from different cities of Pakistan. Each of the products is not available at every city.
EXAMPLE: Multani sohan halwa: sweet, semi hard form, bar shape. Nimko : nut snacks, fried ,salty. Similarly all of our products have different features and different packaging.
COMPETITIVE COMPARISON: As in the Pakistani food items sell online segment, there are a few dealers such as • Ali Baba, • 21Food • Tohfay They are the saughaats dealers. But all these dealers are not specified in food items and saughaats. So they could be a rival but the chances of competition are very low. But we should be cost and time efficient to avoid the competition .That will enable us to get the maximum competitive advantages in our segment.
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Financial plan Initial investment: Web site development cost
30000
Office on rent in 3 cities (12000/month)
36000
Employees cost
200000
Marketing cost
72000
Utilities Equipment Furniture and fixtures 350000
Total 793000
75000 30000
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PRODUCT LINE AND PACKAGING:
1
SOHAN HALWA
MULTAN
400/kg
2
NIMKO
KARACHI
300/kg
3
PAIRAY
MARDAN
350/kg
4
SPICES
HAIDERABAD
500/dzn.spices
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PICKLE
SHIKARPURA
500/800gm pack
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REVRI
CHAKWAL
375/kg
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MIX DRY FRUIT
PISHAWAR
1250/kg
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BURFI
MIAN CHANNU
500/kg
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DATES
BAHAWALPUR
550/5kg pack
MANGO
SHUJABADMULTAN
1050/5kg
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Projected Quarterly Sales ITEMS PROJECTED QUANTITY*PRICE PROJECTED SALES SOHAN HALWA 140000/quarterly
3500kg*400
Nimko
5000kg*300
150000
PAIRAY
3500kg*350
140000
SPICES 350000
7000 sets*500
PICKLE
1200packets*500
REVRI MIX DRY FRUIT 150000
2000kg*375
3000kg*500
DATES
600packs*550
Total REVENUES 1595000
75000
1200kg*1250
BURFI
MANGO
60000
2500packs*1050
150000 33000 262500
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Projected Profit and Loss Pro Forma Profit and Loss Sales Direct Cost of Sales Other Total Cost of Sales Gross Margin Payroll Sales and Marketing and Other Expenses Repairs & Maintenance Office Supplies Rent Other
Year 1 Year 2 Year 3 6380000 6738000
6978000
4877200 0
4887200 0
4977200 0
4877200
4887200
4977200
1502800 396000
1850800 396000
2000800 396000
72000
73000
75000
6000
6180
6365
2400 432000 0
2472 432000 0
2546 432000 0
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Total Operating Expenses Profit Before Interest and Taxes Taxes Incurred Net Profit Net Profit/Sales
908400
909652
911911
594400
941148
1088889
10955
15596
18599
583445
925552
1070290
9.14%
13.74%
15.34%
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HUMAN RESOURCE PLAN Human resource planning refers to the development of strategies for matching the size and skills of the workforce to organizational needs. It assists organizations to recruit, retain, and optimize the deployment of the personnel needed to meet business objectives and to respond to changes in the external environment. The process involves carrying out a skills analysis of the existing workforce, carrying out manpower forecasting, and taking action to ensure that supply meets demand. As the competition for skilled employees is becoming even tighter, we need to be proactive in HR planning if we want to continue to build a high performance, high involvement, and inclusive workplace. The HR planning process is illustrated in the following diagram.
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FOLLOWING STAFF WILL BE NEEDED: 1.
MANAGERS Marketing Manager
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HR Manager Finance Manager Operations Manager
2.
ASSISTANT MANAGERS 2 Sales Promotion officers Assistant HR Manager Assistant Finance Manager Assistant Operations Manager
3.
OTHER STAFF Order handling officer Accountant Cashier Storekeeper Front Desk Coordinator
PAY SCALE FOR DIFFERENT LEVELS OF EMPLOYEES:
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• MANAGERS- Rs. 25000 • ASSISTANT MANAGERS- Rs. 17000/• CUSTOMER SUPPORT REPRESENTATIVES- Rs. 10000/• ACCOUNTANT- Rs. 11000/• CUSTOMER SALES REPRESENTATIVES - Rs. 7000/• STOREKEEPER- Rs. 7000/• FRONT DESK CO-ORDINATOR- Rs. 8000/-
Harvesting Our business is related to the food items, that’s why its demand always increases. But in any case if there will be a threat of
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business loss due to some serious conditions we will go for liquidation. We will stop taking more orders.
Selling of business: There is also an option of selling our business. For this purpose we will go for market research. If there will some potential customers for our business we sell it.
