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A GREAT WHOLE NEW BUSINESS PLAN REPORT WITH EVERYTHING NEEDED TO START THE BUSINESS.
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DATE
29-03-14
E-Strat Business Plan e-commerce internet business plan
Sachin pratap singh MBA3 (1357) Universal Business School, Karjat, Mumbai. Submitted To- Prof. Bibhas Basumatary.
Acknowledgement
I have taken efforts in this project. However, it would not have been possible without the kind support and help of many individuals. I would like to extend my sincere thanks to all of them.
I am highly indebted to Professor Bibhas for their guidance and constant supervision as well as
for providing necessary information regarding the project & also for their support in completing the project.
I would like to express my gratitude towards my siblings for their kind co-operation and
encouragement which help me in completion of this project.
My thanks and appreciations also go to my colleague in developing the project and people who have willingly helped me out with their abilities.
Table of Contents
Page 1
1.0 Executive Summary ......................................................................................................................... 1
Chart: Highlights........................................................................... Error! Bookmark not defined.
1.1 Mission ................................................................................................................................................ 2
1.2 Keys to Success ............................................................................................................................. 2
2.0 Company Summary .......................................................................................................................... 2
2.1 Company OwneRship ................................................................................................................... 2
2.2 Start-up Summary ........................................................................................................................ 3
Table: Start-up ................................................................................................................................... 3
2.3 SWOT Analysis………………………………………………………………………..4
3.0 Products ................................................................................................................................................. 4
4.0 Market Analysis Summary............................................................................................................. 6
4.1 Market Segmentation .................................................................................................................. 6
Table: Market Analysis.................................................................................................................... 7
Chart: Market Analysis (Pie) ........................................................................................................ 8
5.00 PORTER'S Five forces model……………………………………………………………………7 Business canvas model…………………………………………………………………………..8
5.0 Strategy and Implementation Summary................................................................................ 8
5.1 Competitive Edge .......................................................................................................................... 9
5.2 Sales Strategy................................................................................................................................. 9
5.2.1 Sales Forecast ...................................................................................................................... 10
Table: Sales Forecast ................................................................................................................ 10
Chart: Sales Monthly ................................................................................................................. 10
Chart: Sales by Year .................................................................................................................. 10
5.3 Controls……………………………………………………………………………10 6.0 Management Summary ................................................................................................................ 11
6.1 PeRsonnel Plan ............................................................................................................................. 11
Table: Personnel .............................................................................................................................. 11
7.0 Financial Plan ..................................................................................................................................... 11
7.0 Financial Plan ..................................................................................................................................... 11
Fire cooper
Page 1
1.0 Executive Summary
Popular culture is no longer regional. The advent of cable television, syndicated radio programs, and the Internet has created a world where a fashion statement in Mumbai will
be on the streets. The speed of our telecommunication system has increased young customers' expectations and demands for products that represent their own cultural statement.
Firecooper will offer young customers, in small towns and communities around India, the youth-oriented products and clothing that are popular nationwide but not available locally.
The difference between Firecooper and other youth-oriented e-commerce websites is
that Firecooper is focused only on its small-town Indian customers. The target customer is a young person, age 11-18, who listens to alternative music and participates in youth sports like cricket and football, boxing. Our target customer will look toward alternative clothing trends in large urban areas as their inspiration.
Firecooper will exclusively advertise in small communities with populations between 100,000 and 150,000 residents. Communities of this size already have small youth-oriented businesses, like sports shops and alternative CD stores, that Firecooper can utilize to
promote its product line.
Sales
Gross Margin
Net Profit
Rs0
500,000
1000,000
1500,000
2000,000
2500,000
3000,000
3500,000
4000,000
Year 1 Year 2 Year 3
Highlights
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1.1 Mission
The mission of Firecooper is to offer distinctive youth-oriented fashion and products to small-town Indian.
1.2 Keys to Success
Accessible website that is entertaining to surf. Like a trip to your favorite store where you always find something new that you want.
Excellent vendor relationship that will facilitate quick shipment of orders.
Establish an effective strategy for advertising in the communities' youth-oriented
businesses.
Create a store image that our target customers sees as both attractive and trendy.
2.0 Company Summary
Firecooper will offer youth-oriented products and clothing, online, that are popular
nationwide but not available locally. Firecooper, will create a cost-effective operation that will quickly ship clothing and product purchases to the customer.
Firecooper will focus on marketing products to its target customers in small cities with
populations between 100,000 and 150,000 residents. The key to marketing strategy will be staging events that will increase the visibility of the online store with the target customer base. We will use existing local businesses that serve the same target customer base to
co-sponsor these events.
2.1 Company OwneRship
Sachin Pratap Singh will be the owner of Firecooper.
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2.2 Start-up Summary
The start-up costs of Firecooper consists of product inventory, creating a promotion
campaign and establishing its website. Firecooper is funding start up with owner investments.
Start-up
Table: Start-up
Start-up Rs
Requirements
Start-up Expenses Legal 62,000
Stationery etc. 20000 Website Development 230,000 Insurance 10,000
Rent 20,000 Marketing 320,000 Expensed Equipment 0
Other 0 Total Start-up Expenses 662,000
Start-up Assets Cash Required 164,600 Start-up Inventory 380,000
Other Current Assets Rs0 Long-term Assets 100,000 Total Assets 544,600
Total Requirements 1150,000
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SWOT Analysis
The following SWOT analysis captures the key strengths and weaknesses within the company and
describes the opportunities and threats facing by Fire cooper.
Strengths
Strong relationships with private label manufacturers that provide high-quality
supplements and on-time deliveries.
Efficient operations providing firecooper with above-average margins.
The ability to scale rapidly as sales increase.
Weaknesses
The lack of brand awareness due to the fact that firecooper is a start-up company with
only an Internet presence, no real store front.
The proven strategies for developing online visibility are still being tested, it is currently
trial and error.
Opportunities
An efficient business model within a growing industry.
The ability to service the entire country.
Provide differentiation through enhanced convenience and service attributes.
Threats
General trepidation of Internet-based business.
Increased government regulation for supplements.
Aggressive competition from Indian and other markets.
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Competition
Within the mass-market retailer channel, the three primary vitamin and supplement product
categories are national brands, broad-line brands, and private label brands. The national and
broad-line brands consist of 60% of the domestic market, while the private label brands
account for the remaining 40% of the market.
Broad-line Brands
Full lines of products under one brand.
This is the market segment where most of the product development and innovation
occurs.
Stronger potencies and cutting-edge ingredients.
Highest price.
Private Label Products
Under retailer's name.
Smaller line of products than broad-line brands.
Manufactured by a third party.
Tend to be the cheaper.
3.0 Products
Firecooper will offer young customers the following youth-oriented products and clothing:
Shoes.
Jackets.
SweateRs.
Shirts.
Pants.
Bags.
Hats.
T-Shirts.
Dresses and skirts.
Shorts.
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Eyewear.
Time pieces.
4.0 Market Analysis Summary
According to the indian research was In India, s aged between 10-19 yeaRs account for
more than one-fifth of the world’s population. This age group forms 21.4 percent of the total population. Teenagers influence Rs324 billion in spending annually, have Rs151 billion in disposable income, spend Rs24 billion annually, and will spend Rs1.2 billion online
by 2010. Teens spend an average of Rs82 per week on entertainment, fashion, food, and technology. These young people dubbed "Generation Y" dominate almost all facets of popular culture and are the fastest-growing demographic under age 65.
Specialty youth clothing and products has grown into a billion dollar niche in the clothing
industry. The popularity of the Internet with young people has been well documented and has generated the launching of a number of online stores by companies selling to that market segment. Most of these stores have retail outlets in large urban areas that serve as
the promotional vehicles for online shopping.
The Internet is an accessible shopping tool for our target population. 64% of teens nationwide use the Net at home. The majority of teens, 55%, consider using the Internet
better than watching TV. Families with teens are more likely to have Internet access than other households.
Online shopping by teenagers between 13 to 18 years in age is expected to total about Rs300 million the year 2013 and is accelerating at about twice the rate of online shopping
by adults
4.1 Market Segmentation
Over the past ten years, there has been a profound change in population dynamics in the INDIA. The non-metropolitan population has been growing at almost the same rate as the
urban population. The West, and Northeast have the largest growth rate. Today, there are millions of young people who don't live near a large urban center that off Rs the diversity in clothing products that the youth culture demands. This has created a small market niche for
businesses to sell clothing and products to young people who live outside the urban
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Page 7
areas. This is particularly true in communities with a major college located in the community.
Unfortunately, the focus of these mall stores is only on the mainstream of the youth market. Alternative clothing and products are rarely available outside the urban area. This is true because the companies that create the clothing and products are small and sell primarily
through urban specialty shops.
Firecooper will capitalize on the following characteristics of Generation Y:
Subculture Affiliation: Though rebellious, teens also want to blend in and be accepted by Rupees. They seek a community of Rupees to welcome them in, as well as help them
stand out.
Attitude: Teenagers wear attitude like a uniform to give definition to their identity. This
extends to clothing, hair style and the type of music listened to in public. They also react to humor, and silliness more easily than to other styles.
It is Firecooper' plan to bring alternative fashion and products to small-town Indian via the Internet. We will create a business identity that will capitalize on the attitude of our target
customers.
Firecooper will focus marketing on two type of non-metropolitan communities:
Non-metropolitan communities with populations between 100,000 and 150,000
residents.
Non-metropolitan communities with a major college and population of at least 80,000.
Table: Market Analysis
Market Analysis
Year
1
Year
2
Year 3 Year 4 Year 5
Potential Customers Growth CAGR Communities
(100,000 and 150,000)
10% 6,000 6,600 7,260 7,986 8,785 10.00%
Communities/College
(>80,000)
10% 3,000 3,300 3,630 3,993 4,392 10.00%
Total 10.00% 9,000 9,900 10,890 11,979 13,177 10.00%
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Chart: Market Analysis (Pie)
Positioning Firecooper will position themselves as a one-stop Internet purveyor of high-quality, reasonably-
priced supplements. Firecooper will leverage its competitive edges to achieve the desired
positioning:
Firecooper's competitive edge will be its easy to use website and superior customer
service. The website design will be a competitive advantage because research indicates that
an easy-to-use website significantly increases sales. Too often sales are lost because of
complex websites that are far from intuitive.
Firecooper's other competitive edge is superior customer service. The mantra of the
customer service department is to serve the customer in any way required. Customers that call
in with problem/issues will be amazed at the amount of personal attention they receive, and
how quickly issues are not only resolved but significantly improved. Superior customer
service will be a powerful asset.
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Porter’s five model
Threats of new entrants: is high in the e-commerce internet retailing because it is difficult to
survive in this competitive [.
Bargaining power of buyer: is medium because people wants discounted for these kind of things
and because it’s a great deal for youngsters.
Threats of substitutes: is low as the other competitors are not readily available in everywhere at
a cheaper price.
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Bargaining power of suppliers: is moderate as the pricing policy are more or the less are same
everywhere.
Degree of Rivalry: is moderate because there are many competitors are already there.
Business Model Canvas
Key Partners Key
resources Customer relationship
channels Value propositions
Suppliers Developers Order through website
Own store New product
Competitors Suppliers Free delivery Web sites Cheap price
Joint venture Worker Forums TV/Newspaper Buy one get one free
Wholesalers Delivery staff Gifts Home delivery Faster Improvements
Ad Agency Raw material Safety Wholesaler Brand
Customer segment
Revenue stream
Cost structure
Key Activity
Women Advertising Salaries Delivery
Kids Usage Delivery Pakaging
Teenager Word of mouth
Rent Receiving orders
College going Sales Marketing Marketing
School going Personal sales
Raw Material
Making
Brand awareness
Suppliers Payment
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Marketing Mix Firecooper marketing mix is comprised of the following approaches to pricing, distribution,
advertising and promotion, and customer service. Pricing: The pricing structure will slightly undercut the national brands. Firecooper is able to do
this by leveraging its efficient business model as well as using private label manufacturing. Distribution: All products will be distributed through its warehouse, accessed via the website, and delivered throughout this country as well as internationally.
Advertising and Promotion: Internet-based marketing as well as outdoor ads will be used.
5.0 Strategy and Implementation Summary
Firecooper' will have a two track strategy.
1. Firecooper will advertise in alternative magazines that are targeted at our customers and the ad rate is affordable.
2. Firecooper will also plan 15 events in select communities to raise its visibility with the
target customers. The focus will be initially on the West during the first year of
operation. During the second year of operation, Firecooper will plan events in the Mid and the East. We will assemble groups of boy cricket games and sponsor them with the Firecooper logo. The groups will be scheduled to tour selected communities. Firecooper
will sponsor the events but will also seek local businesses that target the same customer base to share the event's sponsorship. Firecooper will book local popular alternative bands to play the event. At these events, Firecooper will distribute stickers,
caps, t-shirts, and promotional material offering a 20% discount on purchases.
5.1 Competitive Edge
Firecooper' competitive advantage is offering product lines that make a statement but won't leave you broke. The major brands are expensive and not distinctive enough to satisfy the
changing taste of our target customers. Firecooper offers products that are just ahead of the curve and so affordable that our customers will return to the website often to check out what's new.
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Page 12
Another competitive factor is that products for this age group are part of a lifestyle statement. Firecooper is focused on serving youth outside the metropolitan areas. We want
to represent their style and life choices. We believe that we will create a loyal customer base that will see Firecooper as part of their lives. To facilitate that connection, our website will have a chat section where our customers can share what is happening in their
communities as well as comment on our products and what we should add to our product line in the future.
5.2 Sales Strategy
Sales will be flat for the first 45 days of operation. We anticipate that sales will begin at this point and increase as our marketing campaign progresses.
5.2.1 Sales Forecast
Chart: Sales Monthly
Clothing
Shoes
Products
0
10,0000
200,000
300,000
40,0000
500,000
600,000
70,0000
Month 1 Month 2
Month 3 Month 4
Month 5 Month 6
Month 7 Month 8
Month 9 Month 10
Month 11 Month 12
Sales Monthly
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Chart: Sales by Year
5.3 Controls
The purpose of Nature's Candy's marketing plan is to serve as a guide for the organization.
The following areas will be tracked to gauge ongoing performance.
Customer acquisition costs.
Repeat customers.
Customer satisfaction.
Clothing
Shoes
Products
Rs0
500,000
1000,000
1500,000
2000,000
2500,000
3000,000
3500,000
4000,000
Year 1 Year 2 Year 3
Sales by Year
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6.1 Personnel Plan
Firecooper will have a staff of five:
Operations manager.
Buyer/marketing.
Order processor/website manager.
Processing staff (2).
7.0 Financial Plan
The following is the financial plan for Firecooper.
7.1 Break-even Analysis
The monthly break-even point, based on forecasted monthly expenses and costs.
Chart: Break-even Analysis
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7.3 Projected Cash Flow
The following table and chart is detail the projected cash flow for three years. The appendices include first year cash flow monthly estimates.
Table: Cash Flow
Pro Forma Cash Flow
Year 1 Year 2 Year 3 Cash Received
Cash from Operations Cash Sales Rs395,650 Rs610,000 Rs750,000
Subtotal Cash from Operations Rs395,650 Rs610,000 Rs750,000
Additional Cash Received
Sales Tax, VAT, HST/GST Received Rs0 Rs0 Rs0 New Current Borrowing Rs0 Rs0 Rs0 New Other Liabilities (interest-free) Rs0 Rs0 Rs0
New Long-term Liabilities Rs0 Rs0 Rs0 Sales of Other Current Assets Rs0 Rs0 Rs0 Sales of Long-term Assets Rs0 Rs0 Rs0
New Investment Received Rs0 Rs0 Rs0 Subtotal Cash Received Rs395,650 Rs610,000 Rs750,000
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations
Cash Spending Rs177,600 Rs192,600 Rs212,000 Bill Payments Rs103,957 Rs455,446 Rs469,732 Subtotal Spent on Operations Rs281,557 Rs648,046 Rs681,732
Additional Cash Spent Sales Tax, VAT, HST/GST Paid Out Rs0 Rs0 Rs0
Principal Repayment of Current Borrowing Rs0 Rs0 Rs0 Other Liabilities Principal Repayment Rs0 Rs0 Rs0 Long-term Liabilities Principal Repayment Rs21,600 Rs1,800 Rs1,800
Purchase Other Current Assets Rs19,800 Rs19,800 Rs19,800 Purchase Long-term Assets Rs0 Rs0 Rs0 Dividends Rs0 Rs0 Rs0
Subtotal Cash Spent Rs322,957 Rs669,646 Rs703,332
Net Cash Flow Rs72,693 (Rs59,646) Rs46,668
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Cash Balance Rs137,293 Rs77,647 Rs124,315
7.4 Projected Balance Sheet
The following table shows the projected balance sheet for three yeaRs.
Table: Balance Sheet
Pro Forma Balance Sheet
Year 1 Year 2 Year 3 Assets
Current Assets Cash Rs137,293 Rs77,647 Rs124,315 Inventory Rs6,270 Rs108,781 Rs109,562
Other Current Assets Rs19,800 Rs39,600 Rs59,400 Total Current Assets Rs163,363 Rs226,028 Rs293,277
Long-term Assets Long-term Assets Rs50,000 Rs50,000 Rs50,000 Accumulated Depreciation Rs7,140 Rs14,280 Rs21,420
Total Long-term Assets Rs42,860 Rs35,720 Rs28,580 Total Assets Rs206,223 Rs261,748 Rs321,857
Liabilities and Capital Year 1 Year 2 Year 3
Current Liabilities
Accounts Payable Rs9,633 Rs39,924 Rs38,490 Current Borrowing Rs0 Rs0 Rs0 Other Current Liabilities Rs0 Rs0 Rs0
Subtotal Current Liabilities Rs9,633 Rs39,924 Rs38,490
Long-term Liabilities Rs128,400 Rs126,600 Rs124,800
Total Liabilities Rs138,033 Rs166,524 Rs163,290
Paid-in Capital Rs200,000 Rs200,000 Rs200,000
Retained Earnings (Rs155,400) (Rs131,810) (Rs104,776) Earnings Rs23,590 Rs27,034 Rs63,343 Total Capital Rs68,190 Rs95,224 Rs158,567
Total Liabilities and Capital Rs206,223 Rs261,748 Rs321,857
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Net Worth Rs68,190 Rs95,224 Rs158,567
Reference
http://www.huffingtonpost.com
http://www.entrepreneur.com/startingabusiness/index.html
http://www.t3.com
Page 1
Reference
http://www.huffingtonpost.com
http://www.entrepreneur.com/startingabusiness/index.html
http://www.t3.com
