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SUNSTAR BEVERAGES
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SUNSTAR BEVERAGES
Office:
Bhimber Road, Near Pind Ftyana, Gujrat
Phone:
(053) 512453
(053) 515600
Fax:
(053) 510066
Email:
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SUNSTAR BEVERAGES
Table of Contents
TABLE OF CONTENTS...............................................................................................................................1
INTRODUCTION:......................................................................................................................................3
DESCRIPTION OF BUSINESS:...........................................................................................................3
FINANCING:..................................................................................................................................................3
EXECUTIVE SUMMARY:.......................................................................................................................4
MISSION:......................................................................................................................................................4SOLOGON:...................................................................................................................................................4VISION:........................................................................................................................................................4OBJECTIVES:................................................................................................................................................4KEYS TO SUCCESS:.....................................................................................................................................4COMPANY HIGHLIGHTS:..............................................................................................................................4
INDUSTRY ANALYSIS:..........................................................................................................................6
TARGET MARKET:.......................................................................................................................................7COMPETITION:.............................................................................................................................................7
DESCRIPTION OF VENTURE:............................................................................................................7
PRODUCT:....................................................................................................................................................7SIZE OF OPERATION:...................................................................................................................................8OFFICE EQUIPMENT:....................................................................................................................................8BACKGROUND OF THE ENTREPRENEUR:....................................................................................................8
PRODUCTION PLAN:.............................................................................................................................9
Ingredients..........................................................................................................................................9STAGES OF PRODUCTION PROCESS:.............................................................................................9
OPERATIONAL PLAN:.........................................................................................................................10
MARKETING PLAN:..............................................................................................................................11
PRODUCT:...................................................................................................................................................11PLACE.........................................................................................................................................................12
Main Suppliers.................................................................................................................................12Marketing Distribution Channel................................................................................................12
PRICE:.........................................................................................................................................................12Discounts, Allowances Offered..................................................................................................13
PROMOTION:...............................................................................................................................................13Communication Channels...........................................................................................................13
ORGANIZATIONAL PLAN:.................................................................................................................13
HIERARCHAL STRUCTURE:.........................................................................................................................14
FINANCIAL PLAN:....................................................................................................................................16
BREAK EVEN ANALYSIS:............................................................................................................................17
APPENDIX:................................................................................................................................................19
MARKET RESEARCH:..................................................................................................................................19
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SUNSTAR BEVERAGES
Introduction:The Sunstar Beverages is a new firm going to start its operation in Gujrat. It will start
with an energy drink product with the name “Power Trip”. Sunstar will be a partnership
firm. The names of partners are given below. The firm is going to start its operations in a
limited geographical level. The company’s growth policy is to fulfill the customers need
with quality product to grow.
Co-owners:
Aftab Siddiqui
Haseeb Razzaq
Rizwan Safder
Saadat Meeran
Shayan Nadeem
Tayyaba Kanwal
Description of Business:This business provides unique energy drink with mix fruits flavor without any harmful chemical. We provide healthy mix fruit energy drink with high quality and affordable price.
Financing: Initial financing is PKR 10,00,000. This finance will cover office exp, marketing exp, plant and office rent.
This report is confidential and is the property of co-owners listed above. It is intended for use only by the persons to whom it is transmitted, and any reproduction or divulgence of any of its consent is prohibited.
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SUNSTAR BEVERAGES
Executive Summary:
Mission:“Our mission is to serve people by providing quality energy drink”
Sologon:“FEEL THE POWER”
Vision:Our vision is to capture gujrat market by providing quality energy drink at low price in order to keep people healty and fit.
Objectives: Maintain positive, strong growth each year not withstanding seasonal sales
patterns. Achieve a comprehensive output in market penetration. Decrease customer dissatisfaction simultaneously. A double to triple digit growth for the first five years Increase the profit margin by adequate percentage each quarter through efficiency
and economy of scale. Maintain a significant research and development and advertisement budget to
enhance future product developments.
Keys to Success:The keys to success are designing and producing such type of products that meet market demand. In addition, our Company must ensure total customer satisfaction. If these keys to success are achieved, it will become a profitable, sustainable company specifically which will produce long lasting results as well.
Company Highlights:The firm is going to start the operation to fulfill the need of the market segment that still has not been fulfilling properly. The market segment which is known as the energy drink is our focus. The people today have too much busy life. Their tight work routine absorbs all the energy from their body and soul. In this situation they need something that fulfill their energy need and make them fresh instantly.
There are some products already exist in the market to take advantage of that segment of market. But the fact is that the competition is not so stiff in this segment. Another fact is that the products which already exist in the market have a high rate.
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The fundamentals of our business will be to “fulfill the need of the people to remain energetic with our world class product at an affordable price”. We take our customer as our first priority while taking any decision.
Our target market of our mix fruit Energy drinks are mainly targeted towards those who need some sort of energy boost. Now everyone is facing the super-charged, over-worked lifestyle, but young people are especially vulnerable to persistent exhaustion and insufficient energy. We will specially make our marketing efforts around Teenagers, Adults, and also Late 50’s.
The owners are the firm is the partners in the firm who don’t have any intention to go in the public. The names and share of the partners are mention in the operational plan of the. The capital can be raise from the banks as well if necessary at any time.
The industry has a very bright future as everyone expecting from the trends prevailing in the market. The energy drinks demand is rising as compared to the other drinks available in the market. The people are coming more and more towards the energy drinks not only to get their selves fresh but also regain the energy of the body which they loss during the everyday chores of work. As the share of industry is rising as the time passes on so to launch a business in such an environment where on one side the industry share of total market is increasing and on other side not much competitors are available in that segment looks like a very vise decision.
The one weakness which we have is that we are new entrants in the industry as well as well we do not have the as much financial resources as the other competitors have. But the positive point is that we can still successfully compete with competitors due to our strategy. The one weakness that we have few financial resources is overcome by our strategy to start with a small geographical region “Gujrat”. The advantage which we have over the competitors is that all the partners belong to the same geographical region so they are well familiar with the target population of the area. No matter that financial resources are few but the extensive marketing strategy can be launched because of the small geographical area. The close knitted connections of the partners in area and quality product at affordable price can win a leaders place in that area for our product.
To fulfill this need and want of people we are launching our product with the name “Power Trip” in the market. As we want to see the response of the public towards our product before launch it on a vast level, so we are launching it in the regional area of Gujrat in initial stages.
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SUNSTAR BEVERAGES
Industry analysis:The industry analysis for the drink concluded with following key points for the drink.
i) Power Trip has cultural effects in it also. It will be produced
domestically and will have competitive edge against the
other imported drinks like low cost etc. Moreover the
company can take the advantage of “Be Pakistani & Buy
Pakistani” also. Power Trip can be customized according
to the varying needs of the culture which may take place
from time to time.
ii) Technological changes are kept in mind in developing the
idea of this particular product. Initially existing technology
will be used in production and later on if there is change in
the technology then new technology will be used in for
long run after proper pre-testing.
iii) At present there are no so much legal concerns about this
business. And being a food item there is no as such
restriction imposed by the Govt. because all ingredients
used in making this drink are HALAAL.
iv) There are many other drinks available in the market. But
our focus is on the health of the consumers. More people
will replace their carbonated soft drink by something
'healthier' – noncarbonated drink.
v) Company is forming its own market with the unique concept
of providing energy drink with fruit flavor and original
vitamins without the effect of any harmful chemical.
vi) There is increase in the sales of drinks in the market over
the past three years. The sales of the energy drinks have
doubled in two years. So the growth rate of the industry is
good.
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SUNSTAR BEVERAGES
vii) No new firm has entered in the business since last three
years or so.
viii) The sales of our competitors are steady from the past
three years.
ix) Our customers belong to the different social classes i.e.
middle class, upper class, and so on.
x) No new product introduced by the competitors since last
three years. Distribution channel not much efficient.
Target Market: Teenagers
Adults
Gamerz
Sports persons
Also Late 50’s
Target Market of our mix fruit Energy drinks are mainly targeted towards those who need some sort of energy boost. Now everyone is susceptible to the fatigue of the super-charged, over-worked lifestyle, but young people are especially vulnerable to persistent exhaustion and insufficient energy.
Competition:Company is forming its own market with the unique concept of providing energy drink with fruit flavor and original vitamins without the effect of any harmful chemical.
There are several other competitors who are providing energy drinks but we are specially focusing on healthy energy drink with original fruit contents with low caffeine margin.
Energy Drink PricePower Trip Rs. 30Red Bull Rs. 45Monster Rs. 40Throttle Rs. 50
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SUNSTAR BEVERAGES
Description of Venture:This section will provide detail our product, size of our operation, office equipment, and background of the entrepreneur
Product:Our product is fresh energy drink for those people who need some sort of energy boost. But young people are especially vulnerable to persistent exhaustion and insufficient energy.
This energy drink will keep them fresh and will give energy to their body
This energy drink will have unique freshness, high energetic calories and low price as compare to the existing energetic drinks available in market.
Logo:
Size of operation:We are conducting our operations in Gujrat city. We are lunching our energy drinks in Gujrat city. This will be available in all beverages store, super markets and in shops.
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SUNSTAR BEVERAGES
Office equipment:We have purchased well office equipment e.g. chairs, tables drink stands and other necessary equipment tools.
Background of the entrepreneur:In the past we have been serving the people by offering different products
Many of our products are already in market which are very successful e.g. soft drink, herbal oil, herbal shampoo many others.
Now we think that we should provide an energy drink to people who keep them healthy and retain them fit and fresh.
Production Plan:
METHOD USED TO ESTABLISH THE DEGREE OF PURITY.
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Ingredients
Nutrition Value per 250ml Energy 211
k j (46.6kcal)
Protein 0,5 g Carbohydrates
10,5 g
Fat 0 g Fruit pulps 30 g/l Caffeine 70 g/l Vitamin B 3 7,2 mg (min.40%
RDA)
Vitamin B 5 2 mg (min.33% RDA)
Vitamin B 6 0,8 mg (min.40% RDA)
Vitamin B12
0,4 mg (min.40% RDA)
SUNSTAR BEVERAGES
The samples of the product have been analyzed according to the United Nations
ST/NAR/7 Manual, using the method of Gas Chromatography Mass GCM.
STAGES OF PRODUCTION PROCESS:1. Reception
Selected different fruits are first received at the Production Plant.
2. Crushing
Then the fruits are crushed after removing solid impurities through
Sieving.
3. Maceration
During this process, the wet crushed fruits are left in the hydro
alcoholic solution to separate into hydro soluble constituents by
soaking until the fruits have taught the proper amount of tannins.
4. Alkalinisation
Next, a solution of caustic soda or sodium hydroxide (NaOH) is
added to the obtained extract in order to precipitate alkaloids.
5. Filtration
At this stage, the alkalized extract is passed through a filter in
order to remove any suspended solid particles.
6. Acidification
After that, the former alkaline extract is acidified. Finally, the
obtained ERG - A20 Extract is bottled and stored.
Operational plan: Operational plan of the product includes inventory, shipping, storage, inventory
control procedures, and customer services.
i) Just in time inventory system will be used in case of our
product. It will reduce the storing cost also which will give
us competitive edge against our customers. There will be
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SUNSTAR BEVERAGES
no of suppliers of raw material to avoid any kind of
problem in future.
ii) All manufacturing operations will take place in own
factory. For this purpose machinery needed has already
been installed.
iii) Outward suppliers will pay the shipping charges for the
finished goods. In case of bulk purchase company will pay
30% charges. Purchase of 50,000 units in a month is the
limit for the purpose.
iv) Experienced workers will be hired from other industries
as part time workers at a cost of Rs. 300 per day which will
train our employees.
v) Finished products of the drink will be stored in company
rented building which has the capacity to store 100,000
units in it. Rent of the building is Rs.10,000 per month.
vi) We will maintain the finished goods inventory of
30,000 units at any time (including factory).
vii) A survey will be conducted after every six months
periods including finding out the market trends and
consumer demands about the product. Later on product
can be changed according to the needs.
Marketing plan:Product:
Power Trip energy drink water contains Carbonated water, high fructose syrup and/or sugar, Citric Acid, orange and apple juice from concentrate, natural flavors, Sodium Benzoate, Sodium Polyphosphates, Caffeine, Erythrism Acid, Maurine, Calcium Imodium Etta (to product flavor), Potassium Benzoate, Brominates Vegetable oil.
Nutrition Facts
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SUNSTAR BEVERAGES
Serving size: 1 can (8.4oz); calories 120; total
fat 0g; saturated fat 0g; cholesterol 0mg;
sodium 75mg; total crab. 32g;
dietary fiber 0g; sugars 30g; protein 0g;
riboflavin 20%; vitamin B6 10%; vitamin
B12 10%; Fruit pulps 30%
Company Name
SUNSTAR BEVERAGES
Brand Name Power Trip
Packaging Aluminum slim cans
Capacity/can 250 ml
Tray 24 x 250ml
Disposable Pallet
160 trays
Pallet weight 1150kg
Pallet dimension
100x120x?150cm
Transportation
Can be organized if needed.
Payment Bank transfer or cash in hand.
Packaging:
Designing and Packaging many energy drink companies are more exclusive in their marketing efforts because they gear their products and advertising to a very specialized group. These groups include gamers, extreme sports enthusiasts. You can see the effects of this emphasis on such a target market because it is seen in the advertising campaigns of energy drinks.
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SUNSTAR BEVERAGES
Place
Power Trip focuses on the big and high growth market shared cities of Pakistan like Karachi, Lahore, Islamabad and Multan. Power Trip is also focusing on small cities so that their product will be available even in the small shop of rural area.
Main SuppliersDifferent suppliers in beverage sector in Gujrat.
Marketing Distribution ChannelPower Trip used indirect marketing distribution channel in which only Retailers are involved. Retailers buy the product and sell that product directly to the final consumer for their personal and non business.
Some of major store retailers are:
Super markets
Departmental store
Food and beverages store
Convenience store
Price:
Pricing wise, we follow our motto "Classy but not expensive". As a result, we offer a high quality and fashionable product at a lower price. It allows us to position ourselves as one of the best quality/price balanced brands.
This provides our partners an opportunity to sell a high quality product, while increasing their margins and offering higher profits to their re-sellers.
Purchase price of retailer of 1 can is Rs.30
Discounts, Allowances OfferedIn the competition with other energy and fruit drinks Power Trip tries to gain market share with giving Power Trip with reduce prices in special events such as Ramadan offer, Basant, and other Events.
Promotion:
We will promote our product by using different communication channel.
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SUNSTAR BEVERAGES
Communication Channels T.V campaigns (through Cable)
Bill boards
Local Newspapers
Advertising Campaigns
Organizational Plan:The Power Trip company will be a partnership firm. The partnership will lie between the founders of the company. Partnership will be according to their share of capital invested in the firm. Profit will be distributed between them as per their percentage share in the firm. The every decision will be taken with the consensus and majority of votes will be required to take the decision. On every important document the signature of the at least 3 members should be there. This will also imply on the financial side of the firm. Partners and their contribution to capital is as follow
Name of Partners Contribution
Aftab Siddiqui 19%
Haseeb Razzaq 15%
Rizwan Safder 16%
Saadat Meeran 19%
Shayan Nadeem 18%
Tayyaba Kanwal 13%
Hierarchal Structure:
The hierarchal structure of the Power Trip company is as follow:
Board of Directors------------------------------------------ Partners of Firm
Chief Executive Officer----------------------------------- Saadat Meeran
Chief Financial Officer------------------------------------ Sara Bano
Marketing Manager---------------------------------------- Shams Ali Anjum
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HR Manager------------------------------------------------- Salman Dar
Production Manager--------------------------------------- Shayan Nadeem
Operational Manager-------------------------------------- Aftab Siddiqui
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The Organizational Chart:
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Board of
Directors
CEO
Finance Manager Marketing Manager
Human Resource Manager
Finance Officer
Finance Officer
Marketing Officer
Marketing Officer
HR Officer HR Officer
Officer
SUNSTAR BEVERAGES
Financial Plan:Projected financial statement of company listed below:
Pro Forma Income Statement (PKR 000s)
2009 2010 2011
Sales 6600 9000 12000 Less: cost of sale (2200) 3000 4000Gross Profit 4400 6000 8000Operating Expenses Salaries 1630 1950 2500 Rent 900 900 900 Sales & Marketing Exp 400 700 1100 Utilities 200 350 600 Office Exp 200 330 550 Deprecation 70 70 70 Tax 400 550 700Total operating Exp 3800 4850 6420Net Profit 600 1150 1580
Pro Forma Balance Sheet First year (PKR 000s)AssetsCurrent Assets Cash 650 Account Receivable 120 Inventory 300Total current assets 1070Fixed Assets Office equipment 400 Plant 300 Less Deprecation (70) 630Total assets 1700Liabilities & owner equityCurrent liabilities Account Payable 100Total Liabilities 100Owner equity Equity 1000 Retain earnings 600
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SUNSTAR BEVERAGES
Total owner equity 1600Total Liabilities & owner equity 1700
Pro Forma Cash Flow first year (PKR 000s)Net income 600Add: deprecation 70Increase in inventory (300)increase in debtors (120)Increase in creditors 100Net Cash flow from operating activities 350Payment to fixed assets (700)
(350)Balance 1000Net cash flow 650
Break even Analysis:
0 50000 100000 150000 200000 2500000
1000
2000
3000
4000
5000
6000
7000
8000
Fixed CostSalesTotal Cost
We are determining the break even point graphically.
The horizontal axis showing the no of unit sold and the vertical axis showing for sales revenue and costs. The sales line starts at the origin ends at the point satisfying expected sales.
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The fixed cost line runs parallel to the horizontal axis meets the vertical axis at a point which represents a total fixed cost.
The total cost line starts where the fixed cost line meets the vertical axis ends at the point which represents anticipated sales on the horizontal axis and total cost of the anticipated sales at the vertical axis.
Variable Cost per unit: 10
Fixed Cost: 3800000
Expected Unit Sales: 190000
Break even Volume: fixed cost / price – variable cost
3800000 / 30 – 10 = 190000
Pro Forma Sources and applications of fund (PKR 000s)Sources of fund Personal fund 1000 Net income 600 Add: Deprecation 70
1670Application of fund Plant & Office Equipment 700 Inventory 300Total fund expanded 1000Net increase in working capital 670
1670
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Appendix: The contract of lease of land and building. The lease contract of the machinery. The partnership contract between the partners of the firm. The agreement with suppliers. Rental contract with the logistic facility provider.
Market Research:
Among college energy drink users, consuming energy drinks is particularly popular for insufficient sleep, when one needs more energy in general, to drink with alcohol while partying, and when studying for an exam or completing a major course project. Drinking three or more for a given situation occurs more frequently among those who consume energy drinks for three or more of the six situations that were assessed. Side effects of consuming energy drinks and headaches occur in many energy drink users.
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