Business Plan Abshar Water Final

8/6/2019 Business Plan Abshar Water Final

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Acknowledgement

Appreciation goes to those who have contributed in making of this Project.

These acknowledgements have a great importance for us. We know better

than any one that our parents, our teachers and class fellows made this report

possible.

Our instructorMr. Ali Rehmanbeing gracious bynature has always been

good and helpful to every student. His able-guidance and didactic efforts

always stand us in good stead.

We acknowledge the debt of gratitude from the citadel of our heart, because

without his valuable guidance and instruction our present academic pursuit

might not have been of much value.

We are, and shall remain extremely beholden to him for all the time to come


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Contents Page

Executive Summary

Objective 5

Mission Statement 6

Vision Statement 6

Goal 6

Strategy 6

Planning 7

SWOT Analysis 7

Project profile 8

Industrial Analysis 9

Physical resources 13

Project Costs 14

Annual Income report 15

Monthly expense Report 16

Organizational chart 18

Conclusion 19

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Executive Summary

The project is about preparation of mineral water or manufacturing

of healthy and fruitful water for public. This project tells us that

how we can start new venture the project objectives the venture

mission, vision, financial resources, SWOT analysis etc all will

come in under consideration. Most importantly what would be

project cost and what would be the preliminary expenses to startnew venture. What strategies and plannings would be adopted to

make the business more profitable all will be discussed, how much

expenses occurred all the specific financial statements will be

presents. The organizational structure will be show, and what type

of tangible assets is required to start this venture.

Business Legal Status

During our study we got to know that manufacturing ofmineral water can be started as a sole proprietorship or a

partnership and even it can be registered under company law with

Securities and Exchange Commission of Pakistan (SECP).

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The objective of this project is primarily to putinto practice what we have

learnt from the classroom lectures. The project forms the basis of an

important investment decision. In order to serve this objective, this study

covers various aspects of project concept development, start-up, marketing,

finance and business management. The study briefly discusses government

policies and international scenario, which have some bearing on the project.

The business we choose is a manufacturing of mineral water. We are a

Pakistan-based manufacturer that produces quality drinking water by the

brand name ABSHAR.

What is Mineral Water?

Is not subjected to any chemical treatment.

Is obtained directly from natural or drilled sources from underground

water.

Is collected under conditions which guarantee the original natural

bacteriological purity.

Is bottled at the point of emergence of the source with particular hygienic

precautions.

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To be the

benchmark for prestige, natural spring water in the region

helping to promote mineral water as the highest-quality, andpurest, in Pakistan.

To provide the highest quality and most natural water in the

region in a way that is cost-effective and convenient.

To become a best manufacturer among the top tenth at least in

5 years by the help of providing best mineral water to the end

user.

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Goal

STRATEGY

1. The qualitative and quantitative point of view.

2. Get the best mineral water manufacturer of the city.

3. Provide best and timely supply to our end user.

4. Maximum coverage in an ethical way.

5. Win to win situation for both(for our and our customer)

6. Provide best facilities to

employees for their future

PLANNING

1. Office should be on center of the city(gulberg).

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2. Hire vehicles for distribution.

3. Provide quality products to compete our

competitors.

SWOT Analysis:

Internal analysis

External analysis

Internal analysis:

Strengths:

100% balanced mineral water.

A highly ethical environment.

Sophisticated and trained staff.

Weakness:

Distribution

Market Price-Takers

Customer Feedback

Goodwill

Strict competition in market.

External analysis:

Opportunities:

offering discounted rates

Targeting under developed areas to increase volume.

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Clean water moving towards the need of todays pollutant

environment.

Have great demand.

Threats:

Threat of new entrants.

Discounted rates offer by competitors.

Government Legislations on environmental Issues

PROJECT PROFILE

Opportunity RationaleLahore is a very populous city. Pakistans population has soared up to

149.50 Million (according to government sources), and at least one-third of

it is living below the poverty level. Majority of people have no access to

clean water to drink or proper sanitation facilities. These posses serious

threats to health of masses. Moreover the variable and harsh climate of

Pakistan causes major viral diseases through out the year. This creates a

great demand for clean water in Lahore. Due to these factors, a big

investment opportunity exists in this sector. Therefore we decided to start

with something which has increasing demand of clean water.

Products offered The product range we would like to offer

600 ml bottles (24 bottles per carton)

1.5 liter bottles (12 bottles per carton)

6 liter bottles with carrying handle (4 bottles per carton)

20 liter bottle with stand

Project InvestmentThe total cost of the project is Rs. 10 millions (one crore).

Project LocationThe location will be Lahore gulberg area.

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Key Success Factors

Some of the Key Success factors that will determine the success of this project include:

Availability of regular supplies. A well trained technical staff.

Availability of complete product range.

Reasonable and competitive prices.(may be discounted rates)

INDUSTRY ANALYSIS

Sector CharacteristicsThe review of Pakistani Mineral water market shows that there are around 150companies, which are registered with the Ministry of Health. Out of some 100manufacturing units operating in the country include 10 multinational.

Multinational mineral water companies have played a vital role to provide the base for

the growth of the mineral water industry since the emergence of Pakistan. They havebeen enjoying the bulk of the business and are still enjoying after so many years, though

their collective market share has dropped significantly.

Sub sector InformationThe mineral water industry has experienced major growth in recent years. As per

an estimate this industry is growing at 18 % annually. The Pakistans harsh climateprovides more favorable business opportunities in this business.

Target customersThe Mineral Water industry is growing in Pakistan day by day.

Restaurants

Educational Institutions

Hospitals

Financial Institutions

Home Delivery (specific areas only)

MAJOR COMPETITORS Nestle

Aquafina

Sufi

Aqua Safe

Gourmet

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What is the competition in the

selected field?

Competition in quality of product.

Competition in supply.

Competition in price.

Product 100 % Pure Mineral Water

Health Nutrient by Excellence

Made on up-to-date technology

To Maintain optimal levels of Hydration during exercise

Price Relatively lower prices than competitors

Prices according to segments (Income)

Price schemes and patterns:

according to competitor price changes

Placement Product Distribution through distributors

Efficient mode for the promotion of the product

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They are trying to promote their product through Paper

Billboards

Paper Advertising:

We will advertise in the newspapers on Sundays. The newspapers used are

Nation

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Factory Agents Retailers

Whole sellers Retailers


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News

Dawn

Jang

Why client will buy products from you and not from your competitors?

The client will buy product from us not from our competitors because we

provide following facilities;

1. We work in ethical way.

2. Timely supply and daily booking.

3. Give one week credit facility on cheque to our valuable customer.

4. Provide cheque facility on full payment.5. Return leakage.

PHYSICAL RESOURCESLAND& BUILDING REQUIREMENT

Land RequirementApproximately 3000 sq/ft. will be required for installing and erecting a water

plant. It is recommended that the land should be fully possessed. And the

EquipmentDetails of Office Equipment

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Rs.

Cost of land 1,000,000

Cost of building 1,500,000.

Rs.Furniture and fixture 2,00,000

Miscellaneous tools & equipments 3,00,000


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VehiclesBought 5 vehicles (pick up Suzuki) and following is the detail expense of per vehicle;

Utilities requirement Electricity

Telephone

PROJECT COSTS

The breakdown of total project cost is in the table below:Project Costs Rs.

Land & building 25, 00,000

Cost of vehicles 15, 00,000

Raw material (empty bottles) 300,000Plant & machinery 1,500,000

Office Equipment 5, 00,000

Preliminary Expenses 50,000

Total Cost 6,350,000

FINANCIAL RESOURCESProject Costs Rs.Plant & machinery 1,500,000

Land & building 2,500,000

Vehicles 1,500,000

Furniture & Fixture 200,000Miscellaneous equipments 300,000

Raw material (empty bottles) 300,000

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Monthly AnnuallyRs.

Cost per vehicle (300,000*5) --- Rs.1500000

Running & maintenance Rs. 80000 960,000


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Marketing expenses 500,000

Advertisement expenses 500,000

Debts ------

73, 00,000

Preliminary Expenses 50,000

Total Project Cost 7,350,000

Cash at bank 26,50,000

Total 10,000,000

HUMAN RESOURCEHuman resource requirement for the proposed project is as under:

Positions Number Salary/month Annual salary

Rs. Rs

Administrative staff:

General Manager 1 40,000 40,000

Other Managers 4 20,000 9,60,000Assistants & others 10 8,000 9,60,000

Technical staff 10 8,000 9,60,000

Other subordinates 4 5,000 240,000

Grand Total: 3,160,000

ABSHAR ENTERPRISES

Work sheet for estimated Annual income,

Expenses & profit (loss)

Units sold (liters)

8,00,000 9,00,000 10,00,000(000)

Rs. Rs. Rs. Rs. Rs. Rs.

Income 11200 12600 14000

Sales income (Rs. 14/ liter)Cost of goods sold:

Production cost (Rs.4.5/ liter) 3600 4050 4500

Carriage 50 60 70

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Depreciation 150 150 150

Total production expenses 3800 4260 4720

Gross profit 7400 8340 9280Other operating expenses:

Salaries 3160 3160 3160

Telephone 300 360 380Insurance 40 45 50Office expenses 50 55 60

Sales promotion 400 450 500

Travel 50 60 70

Taxes and licenses 80 90 100

Miscellaneous

Total operating expenses 4080 4220 4320Net profit 3320 4120 4960

ABSHAR ENTERPRISES

Estimated Monthly Expenses & Starting Costs

July 1st, 2008

Estimated Monthly Expenses

(1) (2)

Based on sales How much

Cash

of Rs.8,00,000 needed to start

Item per year business

Rs. Rs.

Salary of managers 60000 120000

All other salaries and wages 21000 63000

Rent - -

Travel 4000 12000

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Advertising 40000 40000

Delivery expenses 30000 90000

Supplies 80000 240000

Recurring inventory

and purchases - -

Telephone 10000 30000Other utilities 25000 50000Insurance 4000 8000

Taxes 5000 10000

Interest - -

Running and Maintenance 80000 160000

Legal and other professional

fees - -Miscellaneous 10000 30000

Starting Cost Have to pay only Once

Rs.Fixture and equipment:

Telephone, Rs.5000;Computer,Rs.60000 65000

Decorating and remodeling 30000

Installation of fixtures and equipment 15000

Starting inventory 100000

Legal and other professional fees -

License and permits 10000Advertising and promotion for opening (Part of Advertising above)

Accounts receivable -

Cash 500000

Other 50000

Total estimated cash you need to start with 1,623,000

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Organizational Chart

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A Last Word

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General ManagerGeneral Manager

MarketingManager

Marketing

Manager HR ManagerHR Manager Production

Manager

Production

ManagerStoreManager

Store

Manager

CEO CEO

Assistant

Manager

Assistant

ManagerAssistant

Manager

Assistant

Manager SupervisorSupervisor Assistant

Manager

Assistant

Manager

SubordinateSubordinateTechnical

Engineer

TechnicalEngineerSubordinate

Subordinate

Plant &Machinery

Operator

Plant &

Machinery

Operator

Other technical

staff

Other technical

staff

JuniorsJuniors

JuniorsJuniors


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Finally, it can be concluded that ABSHAR ENTERPRISES will be a profitable project,

because in this era of education people knows importance of clean water which avoids

hundreds of diseases.The sale of mineral water has registered on average 200 percentannual growth in the past five years in Pakistan, where

the middle class is also in a rush to join the corporate

style of living which still provides 60 percent revenueto water selling companies and encourages them to

maximize commercialization of drinking water. The

business is growing in big cities like Lahore, Karachi,

Islamabad, and Peshawar.

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Documents

Business Plan Abshar Water Final