ASSIGNMENT: GROUP 07 (CCBMDO 17)

ENTREPRENUERSHIP ORINETATION AND INNOVATION

APARTMENT SERVICES MANAGEMENT COMPANY

FACULTY: PROF D. L. SUNDER

SUBMITTED BY

A25 Manoj Dayal

A59 D Abhilash
A21 Harshal More
A38 Sameer Pratap
A50 Virendra Rathore
 BUSINESS PLAN

APARTMENT SERVICES MANAGEMENT COMPANY

EXECUTIVE SUMMARY

The number of apartment complexes are on the rise owing to lack of space in the cities and
each apartment complex has myriad requirements of manpower. There is a need for personnel
for plumbing, security, cleaning of common areas, gardening etc. The purpose of the
Apartment services management company is to be the one stop shop for all manpower
resources of an apartment.

The apartments have Residential Welfare Associations that are elected to supervise
the affairs of the apartment. The residents pay a monthly sum for ‘maintenance’ charges
which are required for the upkeep of the common areas, security, providing in house
plumber, electrician etc. In most cases, the RWAs must approach different people to get these
unrelated manpower resources. Since many RWA members have jobs or businesses, they
may not be able to devote time in head hunting leading to the residents feeling that services
are substandard. There is the additional issue of finding a relief in case of illness or injury or
any other such exigencies.

The company shall be based at Chennai and would provide services at Chennai
initially. The goals and objectives of the company is to provide integrated apartment services
of very high standards on a contract basis. The company shall endeavour to be the one shop
stop for manpower resources requirements for the Resident Welfare Associations. We also
want to provide our customer, the residents consistent and quality services. While doing all
this we are fulfilling personal goals and running a profitable business while positively
contributing to the community.

The apartment residents need various common services like security, cleaning,
plumbing, electrician etc. There is also a requirement for a supervisor for managing the
affairs of the apartment. There is no agency currently at Chennai that provides all kinds of
manpower required by the apartments.
There are roughly 65000 small and big apartments in Chennai and many have some kind
security including those in unorganised sector. The following services will be provided by the
company in the beginning:

• Cleaning & Caretaking

• Security

• Building Maintenance including plumbing and electrical repair

Our plan is to target the medium and large size apartments first by approaching their
Residential Welfare Associations. The company intends to start small and expand as required.

MANAGEMENT

Gp Capt Dayal and the other managing partners of the company are all veterans from
army navy and Air Force. We have been posted to stations all over the country and have
developed an understanding of the people and their psychology up close. Together, we have
60 years of experience of leading some of the highest performing teams and heralding
innovation to dedicate to this new venture. Through hard work, devotion to high quality
service, and the attending business schools, we have developed a high reputation to provide
excellent results.

We have undergone CCBMDO in IIM Indore one of the topmost management institutions in
India. Our military experience makes us ideal candidates for managing manpower, innovation
and responsiveness. Their risk management skills have been honed by years of service in
some of the riskiest jobs in the world.

Cdr Abhilash being a resident of Chennai has good knowledge of the local conditions and
grasp of the language which will be handy in dealing with the people. He is also a resident of
an apartment and is tuned to the problems faced by the RWA s ad residents. Moreover, he
must deal with the state machinery at highest levels which has given him an insight into the
functioning which is important for starting and maintaining a business.

Maj Rathore has a certification in start-ups from the GOI and he will be handy in looking at
the expenses and logistics.
We are very optimistic about this venture as there is a clear and present requirement for an
integrated apartment services company that fulfils all the manpower required in an apartment
complex. There are many security agencies at Chennai which are owned by Ex-servicemen.
In addition, there are many agencies that provide conservancy staff which are again owned by
veterans. We plan to utilise their expertise to gain foothold in the industry.

The team is totally convinced and committed to the venture and ready to work hard for its
success and in true military traditions will not give up. Being in the military, welfare of the
men under us comes first and the same mindset shall help us infuse loyalty in our employees.

Since the military is all about teamwork and sacrificing for a higher cause, the partners are
prepared for taking hard decisions that will invariably come our way.

BUSINESS DESCRIPTION

Concept.

The business will provide all-in-one manpower services for apartments on a contract basis
with the Residential Welfare Associations and thus alleviate their need to look for different
types of skilled and unskilled labour required for maintaining an apartment complex
separately. We feel that there is enough potential in this concept as we will be able to meet
the required manpower. We intend to start with supervisors, security, cleaning, plumbing,
gardening and electrical maintenance and then graduate to providing other services as well
which may include help for shifting of items, driver on call for those who are unable to drive
etc. A relief will be provided as and when one of the staff is unable to attend to his/her duties
due to any reason. We will offer these services at a rate that is at par with that is being spend
by the Resident Welfare Associations on finding different sources. The type of manpower
required would again depend on the size of apartment complex and hence we will have three
different types of services for them.

Name of the Company

We plan to name the company All-in-One Apartment services. We feel that this will
differentiate it from other facility management companies who may be providing some of
these services. In addition, the name is appropriate as it signifies the whole range of services
that we offer. we want the apartment owners to know that we all their primary solution
providers. After conducting a name search with the ROC,we have found that there is no other
company by the same name. In addition, a search on MCA website too retuned the same.

Customer segmentation

Any apartment in Chennai of any size can theoretically be our customer and there are around
60000 apartments at Chennai. While the data of apartment complexes based on size is not
available, even by conservative estimates, the number of customers we get is in the range of
5000-65000.The luxury gated communities are nearly 3000 in number. We would be dealing
with the Resident Welfare Associations who are our primary customers.

Market Analysis.

The market for integrated services at apartments exists in Chennai and other cities and is
waiting to be tapped. An internal survey conducted by the team has revealed that absence of
and need for such a company. Whilst the survey sample was only 14, those surveyed resided
in various parts of Chennai and its outskirts and also stayed in apartment complexes of
different sizes. This is a good representation of the requirement and gives us the requisite
confidence. In addition, the respondents overwhelmingly had positive feelings towards armed
forces and thought that honesty and efficiency to be the words that describe the armed forces
officers the best. This is in line with findings of other nationwide surveys as well. We feel
that we will be able to get the initial foothold in the market and scale up quickly.

Basis of decision of customers.

Our primary customers are the RWAs many of whom are not able to get the necessary
manpower from a single source. The members of the associations must get their security
personnel, conservancy staff, plumbing and electricians all from different sources which is
not so easy for them. We feel they would only be happy to have a single sources for the
manpower required in various capacities for the apartment. Many RWA officials are not
working professionals who don’t have the time to pursue the nitty-gritties of the manpower
issues and this would work for our advantage.

Compelling Reason

With the number of apartments increasing, the need for services is on the rise too. While
there are companies like Urban clap that provide services on an individual basis, they are
highly priced and not affordable on a regular basis. For example, a simple socket replacement
would cost Rs 69 plus an additional Rs 99 to the technician for travel and safety expenses.
The services being rendered by our company is different from those rendered by Urban Clap
and hence there may not be any direct competition. Furthermore, we are dealing with
Apartment Associations on contract basis and not directly dealing with individual customers.
We are hence confident that our serviced would be sought after by the apartment
associations.

Pricing.

We are planning to have three different models eventually depending on the needs projected
by the apartments. One would be our basic service which would only include security
services, cleaning of common areas apartment supervisory staff who would help the RWA in
managing accounts. The middle level service would come with plumber and electrician in
addition. The luxury apartment service could include laundry services and driver on call.

Positioning

For the mid-sized and large size apartments, we think that our company would be the natural
choice for providing all the facilities. There are many apartment societies who are not able to
get the required skilled manpower.

Promotion

We are going to promote the company by word of mouth, and we feel that we will be able to
leverage the Ex-servicemen groups for the same. We will be hosting a website and will use
the same for promotions. We also plan to host a social media page for the same.

Customer Acquisition

We have identified AWHO Tazhambur and DLF Garden City which is located nearby.
AWHO has 832 flats while DLF garden city has 1727 units. Both the apartments have a
substantial number of Ex-servicemen residing and in the RWAs which gives us a foothold.
We have already broached this topic and the idea has been received positively. We are
planning to approach CASA GRANDE at Tazhambur which has a serving officer in the
RWA. The initial customer acquisition would not cost anything, and we shall rely on positive
word of mouth to expand. This along with our social media presence shall help us to catch the
eye of the Resident Welfare Associations.
Initial Investment

We plan to invest Rs 25 Lakh (Rs 5 Lakh each from the partners) for training, hosting a
website, office rentals and refurbishment. We have identified a property in Nungambakkam
which is the heart of the commercial district of Chennai that is available at very cheap rates
of Rs 30000.The said property owned by an NRI is a residential property converted to office.
The location of the office and the appearance after refurbishment would give a professional
and efficient look for our enterprise.

We are in talks with M/s Dolphin enterprises, owned by and Ex Serviceman, who has agreed
to provide manpower for initial training. We have identified a retired NCO of the infantry and
found him suitable for imparting training to the security guards and sensitise the employees.
We plan to tap into the migrant population who are without a job due to corona crisis as our
employees.

Cost of Delivering Service

The company may need to pay according to the minimum daily wage rates that is published
time to time by Tamil Nadu Government. This could be as much as Rs 10000 on an average
across all types of employees (security, gardening, cleaning etc). In addition, the company
needs to provide uniform and equipment for the staff. At times of corona, we may also have
to provide for vaccinations.

Cost to Support Customers

There is no additional cost other than the salaries to support customers. Once we expand, we
may have a pool of employees who may be made to be leave relief and the same may result
in overtime for some employees.

Time for setting up of support structure.

We feel that the company should set up the office and acquire enough employees two months
before commencing operations. We feel confident that the contracts from AWHO and DLF
garden city would be awarded to us in three months’ time. These three months would be
utilised in understanding the requirements specific to the Apartments and the number of
personnel required. Thereafter the employees need to be identified and trained in imbibing
the customer centric approach of the company.

Retention of Customers
The retention of customers is totally dependent on the standard of service and hence we feel
that the training of the employees in their jobs and adopting a customer first attitude is
important. In addition, efforts will be made to covey to the employees about the intentions of
the promoters and ensure them that their fair demands would be met. It is very essential that
the employees feel that they are part of the family.

Break Even Analysis

We expect the company to break even within 6 months if not early. The maintenance fee
charged from the residents is around Rs 3500 in AWHO on an average though the amount
varies depending on the size of apartments. The amount collected from the residents would
thus be around Rs 30 Lakhs per month. If we assume a requirement of 40 employees at
AWHO and they get Rs 15000 on average, the amount spend is Rs 5 Lakhs as salaries. If
AWHO RWA is ready to actually spend half of the amount that is collected for the
maintenance services, the profit is around Rs 10 lakh per month. The actual profits may be
much more as these are highly conservative estimates. Similarly, in DLF garden city with
1700 residents, the profit margin will only increase.

Customer Feedback

We feel the feedback of customer feedback is extremely important for a fledging company
and would keep in touch directly with the RWA members on a weekly basis to take their
feedback. We also intend to take feedback of our services from the end customers who are
residing in the apartments. This will help us do necessary course corrections and the sincerity
of purpose would not be lost on the customers.

Competition

There are 1154 security agencies registered in Tamil Nadu and 832 of these either have pan
Tamil Nadu license or license of Chennai and neighbouring districts. We currently do not
have direct competitors in Chennai and do not have many known competitors in India itself.
However, any of the established security companies can follow suit if required and can be a
threat. Similarly, there are established facility management companies which provide
manpower for offices and even they could think of providing such manpower resources for
Hence, it is essential that we are able to expand our market share quickly.

Strengths, Weaknesses and Resources of competitors

The established security agencies and facility management companies have the necessary
infrastructure and resources. Hence, they have the wherewithal to follow suit and become our
direct competitors. However, it is to be noted that the facility management services
companies have been targeting offices and hence we don’t envisage them becoming a
competition in near future.

One disadvantage they have is that they would also need time and resources to expand into
integrated apartment management services and if we can quickly make a mark and provide
high quality services, we can thrive. In addition, many of them don’t have defence officers at
the helm. Having defence officers at the helm adds a sense of trust, reliability and efficiency
to the company which will work to our advantage. In addition, most Admin heads in
multinational companies are Defence officers and this would indeed help us to expand into
facility management at office spaces as well. So, if the facility management companies
expand into our business, we can do the same and venture into their domain too.

Anticipated response of competitors

We do not foresee an immediate reaction to our entry into security business as there are many
avenues and most of the companies are small scale. We can expand without too much
attention before we are noticed by our competitors.

Own response against response of competitors

The expansion of competitors into our business is a real possibility but it works both ways.
We too can expand into their territory.
India has nearly 760 milion smart phone owners.OLA serves around 200 Million customers in India.