A INNOVATIVE IDEA

ON

“GYAAN LEKH PRODUCT”

Submitted to:

Dr. A.P.J Abdul Kalam Technical University, Lucknow

In thepartial fulfillment for the award of the degree of
Master of Business Administration
(Degree Programme of AKTU, Lucknow)
Batch: 2021-23

Under the Guidance of:

Dr. Mrs. VASUDHA SHARMA
(DIRECTOR MAM , MBA DEPARTMENT)

Submitted by:
AKASH AGARWAL

MBA- I SEMESTER
ROLL NO. PREERN21020110

VIDYA SCHOOL OF BUSINESS

VIDYA KNOWLEDGE PARK,
BAGHPAT ROAD, meerut-250002
 DECLARATION

I, “AKASH AGARWAL” to declare that the Summer Training report entitled

“AN INNOVATIVE IDEA ON GYAAN LEKH PRODUCT”

being submitted to the Dr. ISHAN KAUSHIK Professor , VSB Meerut for the partial
fulfillment of the requirement for the degree of Master of Business Administration affiliated to
Dr. APJ Abdul Kalam Technical University, Lucknow is my own endeavors and it has not
been submitted earlier to any institution/university for any degree.

Place:
Date:

AKASH AGARWAL

MBA I SEMESTER

ROLL NO. PREERN21020110

 ACKNOWLEDGEMENT

It is my pleasure to be indebted to various people, who directly or indirectly contributed in the

development of this work and who influenced my thinking, behavior, and acts during the course of study.

I am thankful to Dr. Mrs. VASUDHA SHARMA DIRECTOR MAM for his support, cooperation, and

motivation provided to me during the training for constant inspiration, presence and blessings.

I also extend my sincere appreciation to Project Guide Dr. VASUDHA SHARMA

(DIRECTOR MAM of MBA DEPARTMENT VSB) , Meerut who provided his valuable
suggestions and precious time in accomplishing my project report.

Lastly, I would like to thank the almighty, parents, Director and HOD of the institute for their moral

support and my friends with whom I shared my day-to-day experience and received lots of suggestions

that improved my quality of work.

(AAYUSHI SINGHAL)
 CERTIFICATE

This is to certify that the report titled entitled “A INNOVATIVE IDEA ON

GYAAN LEKH PRODUCT" being submitted by AKASH AGARWAL &

Reg. ROLL NO. PREERN21020110 in partial fulfilment of the requirements for the

award of the Degree of Master of Business Administration, is a benefited record of

the project work done by AKASH AGARWAL Of Name of the Dept. & MBA.

Dr. VASUDHA SHARMA

(DIRECTOR MAM OF MBA DEPARTMENT)
 Table of contents
1.0 Executive summary
1.1 Objectives
1.2 Mission and vision
1.3 Keys to success
1.4 Start-up costs and funding
1.5 Company ownership
1.6 Products and services
1.7 Market
1.8 Strategy
1.9 Management
1.10 Financials
1.11 Investor considerations
1.12 Disclaimer

2.0 Company summary

2.1 Start-up Summary
2.2 Start- up Funding
2.3 Company ownership

3.0 Product and services

3.1 business model
3.1.1 Competitive Landscape

4.0 Market Analysis Summary

4.1 Market Segmentation
4.2 Target Market Segment Strategy

5.0 Strategy and Implementation Summary

5.1 SWOT Analysis
5.1.1 Strengths
5.1.2 Weaknesses
5.1.3 Opportunities
5.1.4 Threats

5.2 Competitive Edge

5.3 Sales Strategy
5.3.1 Sales Forecast
5.4 Marketing Strategy
5.5 Pricing Strategy
5.6 Sourcing Strategy
5.7 Location and Facilities

6.0 Management Summary

 6.1 Personnel Plan

7.0 Financial Plan

7.1 Break-even analysis
7.2 Projected Profit and Loss
7.3 Projected Balance Sheet
7.4 Long- Term Plan
1.0 Executive Summary

This business plan will show how a total investment of only ₹20,00,000 could generate a revenue

of about ₹60,00,000 lakhs in a year, working at 60% utilization and 300 days in a year. Cost of

production for such a revenue would be around ₹46,00,000, providing the business with a profit of

₹14,00,000 per year and average monthly sales of ₹1,16,000, while maintaining adequate levels of

liquidity.

The purpose of this plan is to secure additional funding from a bank (₹10,00,000 five- year term

business loan), to cover the start-up costs.

Mittal LTD., is a start-up business dedicated to providing excellent quality notebooks to the

residents of India, in a manner that generates fair and equitable returns for present and future

owners, and superior value to our users. We will be specializedin creating and producing a variety

of notebooks and other stationery items for our customers.

India has experienced explosive growth over the past few years. Over past years‟ population of

India has increased rapidly and so the education and literacy level has also increased. We are
catching up with this opportunity. We are opening a manufacturing unit that will focus on the

good quality notebooks and papers.

Currently, there are many other players in the market for the same. Mittal LTD. will offer a better

product, at a reasonable price. We will offer customized product and other stationery product at

reasonable price and better quality.

1.1 Objectives

1) To manufacture a minimum of 600 notebooks per day for distributing in different parts of
India, in the first year of operations.

2) To offer our customers excellent paper quality and stationery items, at a reasonable price,

and provide outstanding user experience, measured by minimum 5 percent yearly sales

growth.

3) To generate positive cash flow from operations, and at least 10 percent net profits to sales.

1.2 Mission and Vision

Mittal LTD.‟s mission is to offer users of India the best quality stationery in the area. We are

committed to providing the service quality and value that our users expect.

Mittal LTD. will use its strategy, staff, and systems to provide each customer with a seamless

three- part customer experience – service product (variety of stationery items), service

environment, and service quality – each part of which will meet or exceed our customers‟

expectations.

Our vision is to become the first choice of stationery in India, and a respected company – as

measured by our users, our employees, our stakeholders and the community we live in.
Our values are critical to our success. They are the strong foundation of Mittal LTD. define who

we are, and set us apart from our competitors. They underlie our vision of the future. These values

include:

1) Performance excellence. We act like responsible owners, always seeking to meet or

exceed expectations.

2) Teamwork. We act as a team, committed to each other, and bound by trust and loyalty.

3) Integrity. We treat one another, and all our stakeholders with dignity and respect.

Honestly, ethical behavior, and integrity are fundamental characteristics of our business

conduct.
1.3 Keys to Success

Our keys to success are:

1) Excellent product and service that will build and maintain customer loyalty.

2) A business location that will assure high company visibility and a high flow of

customers.

3) Proven management ability to successfully run a similar business.

4) Our commitment to continuous improvement and total quality services.

1.4 Start- up costs and funding

After spending several months searching for a convenient location, the owners decided to lease a

building in the industrial area of Ghaziabad, U.P. The start- up capital will be used for legal

expenses, manufacturing inventory and equipment, machinery, packing and other materials,

insurance, rent, promotion, business sign, and inventory on hand at start-up as detailed in the

company summary section of this plan.

We have estimated total start-up costs of 26,00,000. The numbers in the start-up and the start-up

funding tables are meant to reflect these estimates. The company capital will be 20,00,000.

Sonika, as owner, will provide the bulk of start-up financing in the amount of 8,00,000 and 32

percent ownership.

Raj, as co-owner, will provide the bulk of start-up financing in the amount of 8,00,000 and 32

percent ownership. Approximately 10,00,000 additional funding is needed. The purpose of this

business plan is to secure financing for that amount.

For the remaining 10,00,000 additional financing needed to cover the start-ups costs, the company

plans to receive a five- year term commercial loan facility which will meet the cash flow

requirements. The borrowed funds will be used exclusively to but equipment, based on the list
that will be made available to the lending institution. The loan could be repaid in equal monthly

installments over a five- year period.

Our cash- flow analysis demonstrates the company‟s ability to repay the loan and meet

the interest payment obligations, while maintaining adequate liquidity and generating positive

cash flow, and sufficient cash reserves for unforeseen future events.

1.5 Company Ownership

Mittal LTD., will be a privately held corporation owned in majority by Sonika and Raj.

1.6 Products and Services

Mittal LTD. will offer a wide variety of stationery items, such as notebooks, notepads, diary,

pens, colored A-4 sheets, customized pens and notepads.

1.7 Market

India is a growing populated area, counting as the world‟s second population. The average

income for Indian is 1,13,000.

With continued growth in the country, opportunities to serve the users will increase. The company

will sell to small distributors and to their own personal outlets, and it will also customize pens and

notepads as per the choice of customers. If any institute want notepads with their name on it, we

will print it for them.

The main market segments are: a) students, accounting for more than 90 percent of our sales, b)

corporate business which, in terms of purchase orders, purchases notepads for their meetings c)

industry for marking records d) notebooks are basically used in all the areas and working of the

country.
Employees, students, companies, shopkeepers etc. everyone uses registers and notebooks and

every stationery items for their work.

1.8 Strategy

Our strategy is based on serving a strong customer value proposition in all the market. We are

looking to offer the country and on international basis, a new quality of papers, notebooks and

other stationery items for working in every field. Students to fall in study again by writing on the

amazing quality of paper of notebooks.

We are building our marketing infrastructure so that we can eventually reach more retailers. We

focus on satisfying the needs of every students and business class and companies located inside or

outside the country.

1.9 Management

Our management is expected to use resources wisely, operate profitably, pay debts, and abide by

laws and regulations. Our management philosophy is based on team work, responsibility, and

mutual respect. People who work at Mittal LTD. would want to be part of our team because we

operate in an environment that encourages creativity, diversity, growth, and performance.

Raj will be the manager of Mittal LTD. He has successfully owned and operated a similar

business in New York. He is having more than three years‟ relevant experience in the industry,

and hold various degrees and certificates in management.

1.10 Financials

According to our conservative estimates, Mittal LTD. is expected to maintain a healthy financial

position over the next ten years. Our company is expected to break even in the sixth month of

operations.
We also expect to be profitable in the first year of operations, with profits increasing over the next

four years, as we establish and increase our customer base.

Our main concern will be to have sufficient cash on hand to meet our payment obligations and be

prepared for unexpected needs of cash. Our conservative projections indicate that our business is

able to generate positive cash flows and sufficient reserves.

The ratio analysis clearly shows that Mittal LTD., financial position is expected to remain strong,

as measured by its liquidity, long-term solvency and cash flow adequacy ratios.

The company‟s profitability, as measured by its profitability ratios, is excellent, and will

gradually increase over the next ten years. This performance will probably be rewarded by a

higher market price when the company decided to go public.

1.12 Disclaimer

The current unfavorable economic conditions and prospects are carefully considered, and the

estimates included in the plan are conservative. However, investors are advised to exercise

caution when considering investment alternatives because actual data almost always differ from

projections.

This business plan is designed to help investors better understand the potential risks, costs and

benefits of this business project, but it is not intended, and is not to be considered in itself or any

part of it, as an investment offer or solicitation, as regulated by law. It was developed for sample

purposes, and any resemblance to real situations, people, or data would be purely coincidental.
2.0Company Summary

Mittal LTD., is a new manufacturing industry started in India. It is a new start-up business.

(managed by Sonika and her colleague Raj)

Sonika, owner of Mittal LTD., has two years‟ experience in the management industry. Her

colleague Raj, co-owner of the company, has more than three years‟ experience as a manager.

He has successfully operated a similar business in New York, which he left for family

reasons, to move to his motherland India back.

Our focus is to meet or exceed the customer expectations for an exceptional quality paper,

notebooks and stationery items. The company will serve in almost all the part of the country

to their local vendors and corporates. The company‟s product quality is very favorable,

providing high visibility and a large flow of customers. Accordingly, the rent was accounted

for in this plan is higher than in other areas of the city.

Mittal LTD., prices will beat the competition. We are aware that we cannot compete on

prices only. That is why we prefer to focus on assessing customer‟s expectations, and our

core competencies, decide which expectations we can reasonable meet, then make sure to

constantly exceed them wholeheartedly. Thus, we will be able to maintain and increase the

level of customer satisfaction, as a strong foundation for future growth.

The entire manufacturing and distribution process will be conducted though main online

services that have excellent references in India, and we can choose to be one of their

participating suppliers. In this way, we are able to save on delivery costs and logistics, and

simultaneously use the internet exposure of our partners. In addition, delivery people will use

their own vehicles, so the business will not have to purchase delivery vehicles or hire drivers.

We will directly supply our products to the retailers and eliminate the middlemen and reduce

the cost of the product. Moreover, we are looking for opening our own retail stores in

different part of the country so that we can reduce the cost of our products and stationery

items.
2.1Start-up Summary

After spending several months searching for a convenient location, the owners decided to lease a

building in the industrial area of Ghaziabad, U.P. the start-up capital will be used for legal

expenses, manufacturing inventory and equipment, machinery, packaging and other materials,

insurance, rent, promotions, business sign, and inventory on hand at start-up, as shown in the

table below.

Rent-The manufacturing property will be leased in June, 2019 for a minimum of ten years, with

the option to extend lease for another five years after that.

Manufacturing inventory- It will include specific tools and accessories that are typically needed

for stationery items production and service facility and includes:

1) Notebook preparation- white paper, outer cover, stitching wire, jute, twin and gum.

2) Pen manufacturing- ball pen making machines

3) Other manufacturing- stationery related machines, machines for printing names and

customized items.

Manufacturing equipment includes mainly machines for paper cutting, pasting machine, printing

machine, ball pen making machines, cover printing machines, other machines for related work,

other assets like tables, chairs etc.

Approximately fifteen lakhs rupees‟ worth of equipment (long term assets) will be expensed over

the next ten years, using the straight line depreciation method. A complete list of the equipment to

be purchased, including prices and acquisition terms, will be made available for both the investor

and the bank‟s consideration.

Our company policy is to purchase only new, state-of-the-art, energy-efficient equipment from

reliable suppliers in the manufacturing industry.

Other expensed equipment- consists of tables and chairs, coffee makers, water dispensers, small

pare parts, etc.

Inventory on hand at start-up includes specific machines for notebook manufacturing, papers and

cutting machines, printing machines, pasting machines, and different stationery items that can be

manufactured along with the main items. It also includes supplies that are used during the

packing, sale, and delivery process, and miscellaneous supplies.

Insurance premium- for a business risk coverage is initially established at 70,000 for the first two

months, and will be further negotiated with the insurance company. It will be paid by direct debit

on a monthly basis.

Promotion expenses are initially estimated at 90,000 and will be used for various marketing

information materials and advertisements.

Legal expenses include business formation, advice and assistance, basic contracts reviews, and

general business advice.

Office supplies include desks, files, tape, record rooms, forms, etc.

Permits expenses are additional costs incurred to operate legally in India.

There are several India based manufacturers and suppliers of manufacturing machines. The

specific vendors will be chosen soon, based on competitive bidding process. All the selected

manufacturersproduce and supply high- quality, energy-efficient kitchen and restaurant

equipment and they compete primarily on price.

2.2 Start-up Funding

We have estimated total start-up costs of 25,00,000. The numbers in the start-up and the start-up

funding tables are meant to reflect these estimates. The company capital will be 20,00,000.

Sonika, as owner of the company, will provide the bulk of start-up financing in the amount of

8,00,000 and 32 percent ownership

Raj, as co-owner, will provide the bulk of start-up financing in the amount of 8,00,000 and 32

percent ownership. Approximately 10,00,000 additional funding is needed. The purpose of this

business plan is to secure financing for that amount.

For the remaining 10,00,000 additional financing needed to cover the start-up costs, the company

plan to receive three- year term commercial loan facility which will meet the cash flow

requirements. The borrowed funds will be used exclusively to buy equipment, based on the list

that will be made available to the lending institution. The loan could be repaid in equal monthly

installments over a three- year period.

Our cash-flow analysis demonstrates the company‟s ability to repay the loan and meet the interest

payment obligations, while maintaining adequate liquidity and generating positive cash flow and

sufficient cash reserves for unforeseen future events.

For conservative purposes, the annual interest rate has been estimated at 12 percent. The actual

interest rate and borrowing terms will be negotiated with the participating bank. Strong collateral

could be provided by any guarantee, and by the owners‟ personal assets (for example, cash

collateral in the form of certificates of deposit, to cover the remaining collateral requirements in

addition to the guarantee).

2.3 Company ownership

Mittal LTD., will be privately held corporation held in majority by Sonika and Raj. A new

investor will be invited to participate in the company‟s capital.

Their total contributed capital would be 16,00,000.

3.0Products and Services

Mittal LTD., will produce a wide variety of notebooks, as well as customized pens, paper

sheets and other stationery items.

According to Wikipedia.com, the market for exercise notebooks in India has been

traditionally dominated by the unorganized segment. From the endpoint of marginal retailers

to independent sellers, all have dependent on imports from China. However, the market has

developed to achieve a substantial valuation which was not there until 2000. The evolvement

of organized brands as ITC classmate, Navneet and others have added premium to the

market, discerned by the fact that the prices of exercise notebooks have grown 5-6 folds and

even more than that in some cases in the last decade. The exercise notebook market in India

has been

expanding at a decent pace in the wake of growing economy, high literacy levels, burgeoning

middle-class and enhanced scale of initiatives in the education sector. There has been a

marked shift in the preference from cheap local brands to quality products.

The notebooks and other manufacturing items if Mittal LTD. will be distributed on different

retail outlets with offers to attract the customers, and to create awareness among the

customers about our company.

Delivery of products will be done in various parts of the country. The notebooks will be

manufactured and will be packed in a box so that when it reaches its customers, it should look

neat and clean and can attract customers for using this brand more.
3.1Business Model

Mittal Ltd., is a manufacturing unit where different types of notebooks, notepads,

customized notebooks and pens and all other stationery items will be manufactured.

As explained in the previous section, our main products are a variety of stationery

items that will be distributed in various parts of India and online portal also to

purchase the product.

To manufacture notebook, raw materials used are white paper, outer cover, stitching

wire, jute, twin and gum. Machines for manufacturing the notebooks and other

stationer items will be installed in the manufacturing unit, as we plan to invest our

capital in valuable long- term assets.

Notebooks and other stationery items will be delivered in various parts of the country

on different stationery shops.

The entire delivery process will be conducted after doing all the research work and

find out the demand of our product in the market.

3.1.1 Competitive landscape

Currently, there are many competitors with same products are there in the

market. Mittal LTD., will offer a better product, at a reasonable price, and

will always make the product available for their customers.

However, there are many manufacturers in India, that also manufacture

notebooks and other stationery items.

Though their quality is also good and they are the old players in the market

and have well established identities, but still it‟s good to have healthy

competition in order to make yourself on the top of the things.

Other main competitors that we have identified in India are:

Classmate(ITC), Navneet Publications, Repro India, Camlin etc. According

to our market survey, we distinguish ourselves from them by providing

better products at reasonable prices, and will make them available all time

in the market.

Basically what, we have that others don‟t have will definitely be better and

wide range of products at reasonable price.

4.0Market Analysis Summary

India is a growing populated area, counting as the world‟s second largest population. The

average income for Indian is 1,13,000.

With continued growth in the country, opportunities to serve the users will increase. The

company will sell to small distributors and to their own personal outlets. The company will

sell to small retailers and will also accept orders for customized notebooks, notepads and

pens.

We estimate that over 90 percent of our sales will go to individuals (retail customers) and the

remaining balance to corporate business which in terms of purchase orders, purchases

notepads for their meetings, industry for making records and as we know that notebooks are

basically used in all the areas and working of the country.

4.1Market Segmentation

As explained above, the main segments are: a) individuals (retail customers)

accounting for more than 90 percent of our sales, and b) corporate business which, in

terms of purchase orders, purchase notepads for their meetings c) industry for making

records d) notebooks are basically used in all the areas and working of the country.

Employees, students, companies, shopkeepers etc. everyone uses registers and

notebooks and every stationery items for their work.

 Market Analysis (Pie)

corporate
customer other
9% 1%0%

retail customers
corporate customer
other

retail
customers
90%

4.2Target Market Segment Strategy

Mittal LTD., will focus on its market, to all the users in the area, along with local

retailers that are located in different parts of India.

Typically, according to our own market survey, the target individual customers prefer

to purchase notebooks as per their needs, as an alternative sale will usually increase at

the time of summer vacations or at the exams. Businesses prefer to purchase notepads

usually at the end of the financial year when there are meetings in the company.

We will strive to establish a reputable image from that target market‟s perspective, by

offering excellent quality product, convenience, availability of products in the market,

reasonable price, and by partnering with local retailers and other interested

organization our community.

By always focusing on customers‟ needs, wants and expectations, we will be able to

build customer loyalty and word-of-mouth sales that many of our competitors are

lacking.
 Target Market share. The estimated total market share in India is more than 45

percent, and our target market would be 8 percent. We believe this target market share

to be reasonable and achievable. See more details in the sales forecast section of this

plan.

5.0Strategy and Implementation Summary

Our strategy is based on delivering a strong customer value proposition in all over the

market. We are looking to offer the India a new variety and quality of stationery items.

We are building our market infrastructure so that we can eventually reach more customers

with the same level of satisfaction. We focus on satisfying the needs all the users located in

the India.

We intend to use various forms of marketing communication as an efficient way to reach our

target market and raise their awareness of Mittal LTD., and their product offering.

In addition, Mittal LTD., will use effective advertising tools to promote the business.

Advertisement in newspaper and television is a common way to advertise in India.

Adequate funding has been accounted for when projecting the promotion expenses. We

intend to spend the money in the most cost-effective way. Therefore, many other advertising

options will be evaluated during the project implementation, to make sure that we achieve

best results.
5.1SWOT Analysis

The SWOT analysis provides us with an excellent opportunity to examine and

evaluate the internal strengths and weaknesses of Mittal LTD. it also allows us to

focus on the external opportunities presented by the business environment as well as

potential threats.

Next section explains major strengths, weaknesses, opportunities, and threats that

Mittal LTD., should be aware of.

5.1.1 Strengths

Mittal LTD., has a valuable inventory that would help it to be successful.

These strengths include:

1) Good quality at lower price.

2) Paper which can be recycled are used.

3) Management‟s proven experience in successfully running a similar

business in New York.

4) Clear vision of the market needs: we know the customer‟s needs.

5.1.2 Weakness

Strengths are valuable, but it is useful to realize the weaknesses. We have

identified some of our weaknesses:

1) We are new in country.

2) Start-up challenges

3) Limited operating capacity during peak sales periods.

 5.1.3 Opportunities

Mittal LTD., strengths and the awareness of its weaknesses will help it

capitalize on emerging opportunities. These opportunities include, but are

not limited to:

1) Fast growing population in India

2) No other competitors are providing at such reasonable rate.

5.1.4 Threats

Threats the Mittal Ltd., should be aware of include:

1) Changes in the business environment that might reduce our sales

2) Higher taxes in the future

3) The commercial property is leased, no owned by our company.

4) Too many existing competitors.

5.2Competitive Edge

Manufacturing competitive edge is:

1) Location: Mittal LTD., is located in the industrial area of Ghaziabad. All the raw

material, labor and other facilities are easily available in this area which makes

easy for the company to reduce the price.

2) Low operating cost and reasonable price: Since Mittal LTD., policy is to purchase

latest machinery and technology, and will be operating with a team of several

skilled and semi-skilled employees, it will be able to offer reasonable prices for a

high quality notebooks and other stationery items, but it will be impossible to

compete on price only.

 3) Excellent products, timely availability of products.

5.3Sales Strategy

Because Mittal LTD., is a new entity, we recognize that we will need to prove our

company‟s worth to Indian customers, in order to earn respect and business.

Most important, we need to sell our company, not necessarily our products and

services, and create positive word-of-mouth. We will have to push our products.

Our sales strategy is based on the belief that there will be a regular flow of first-time

customers. The real sales effort will be to focus on the conversion of each first-time

customer into a long-term customer relationship, where these customers come

regularly to buy our product, and also bring or recommend new friends to share

experience of great stationery items.

This focus recognizes that it would cost our company less money to convert a new

customer into a long-term relationship, than it does to attract a new customer. With

this in mind, our sales activities will concentrate on keeping existing customers

happy, and always meet or exceed their expectations.

Consistent, customer needs product is the absolute requirement in the manufacturing

industry.

5.3.1 Sales Forecast

The following table and charts illustrate the sales forecast for five years. The first

few months will be slower, a consequence of being a start-up business, struggling

to become more visible within the community, going from nothing to achieve a

regular clientele. A steady growth cycle will occur as the month pass. Profitability

is projected to occur during the first half of the first year.

The increasing sales forecast suggest an important potential growth. Our projected sales are

actually net sales, which consist of the gross proceeds from sales of merchandise – gross sales

– less returns and allowances.

The projected average monthly sales are approximately 1,16,000. Considering average price of

3,500 per item, Mittal LTD., would need to sell on average 25,000 each day (1,16,000 average

monthly sales / 3500 per day/ 26 business days per month).

Two months are reserved each year for pay vacation, when the manufacturing unit will be

closed, but important maintenance works are scheduled for the equipment and facilities during

this break period.

Using our equipment and machinery we will be able to produce maximum 12,000 per day in

two shifts. However, the normal operating capacity, which takes into account the usual breaks

and the idle periods, is 10,000 per day, or 83 percent (usually 20 hours working hours per day).

That means that the average projected 4,500 items per day would be reached at only 37 percent

of normal operating capacity (4,500 notebook / 12,000 notebooks=.37), which is reasonable

target.

In periods of peak sales, the normal operating capacity could be extended by working more

than 20 hours per day. Therefore, we believe that, from the operating point of view, our sales

forecast is feasible.

The question remains, will we be able to attract and maintain at least the minimum number of

customers required to order 4,500 notebooks per day? If each customer would order one

notebook it would means a total of 10,000 per month. This figure is disputable because the

companies typically purchase notepads for their meeting and boxes of pens, and the individuals

usually buy notebooks and less quantity of pen, or sometimes full packet or box of pen.

However, it is a good starting point for our analysis.

According to recent study, notebook sales account for 45 percent of all stationery sales. Our

own market survey shows that one in five purchase interviewed use to buy 3 notebooks at least

once a month.

The population in India is second largest of world‟s population and the world is growing

towards more education India which means there is ample amount of demand in the market for

notebooks and stationery items.

Sales forecast FY 2020 FY 2021 FY 2022

Unit Sales

Notebooks 1,00,000 1,25,000 1,30,000

Pens 60,000 66,000 70,000

Notepads 80,000 85,000 86,000

Other stationery 50,000 60,000 65,000

items

Total unit sales 2,90,000 3,36,000 3,51,000

Unit prices FY 2020 FY 2021 FY 2022

Notebooks 25 26 30

Pens 5 5 5

Notepads 15 16 18

Other stationery 15 18 20

items

Sales

Notebooks 25,00,000 32,50,000 39,00,000

Pens 3,00,000 3,30,000 3,50,000

Notepads 12,00,000 13,60,000 15,40,800

Other stationery 7,50,000 10,80,000 13,00,000

items

Total sales 47,50,000 60,20,000 70,98,000

Direct unit cost FY 2020 FY 2021 FY 2022

Notebooks 20 20.5 21

Pens 3 3 3

Notepads 7 7.65 8

Other stationery 6 7 7.8

items

Direct cost of

sales

Notebooks 20,00,000 20,50,000 27,30,000

Pens 1,80,000 1,98,000 2,10,000

Notepads 5,60,000 6,12,000 6,88,000

Other stationery 3,00,000 3,50,000 5,07,000

items

Subtotal direct 30,40,000 31,92,000 41,35,000

cost of sales
 Chart Title

100%

80%

60%

40%

20%

0%
FY 2020 FY 2021 FY 2022

notebookspensnotepadsother items

5.4Marketing strategy

The marketing strategy of Mittal LTD., centers on creating and developing a

corporate identity that clearly defines our market niche in terms that benefit our retail

and corporate customers.

Market needs and trends. Since our target market includes two major segments to all

segments to country.

One of the key points of Mittal LTD., strategy is to focus on these target segments

that know and understand these needs, and are willing to pay a reasonable price to

have them fulfilled.

Factors such as current local trends and historical sales data of similar businesses in

the area, ensure that the high demand for notebooks and other stationery items will

continue over the next five years Trends are in our favor: the last study we saw was

published in the Hindustan Times has a rapid growth in educational industry.

To reach our potential customers, a combination of marketing techniques will be

utilized:
 1) Local media (newspaper is most effective in India, followed by radio). Newspaper

and radio advertising will include our core positioning message, and products we

offer, in order to differentiate our products.

2) Sales literature. To drive sales initially, Mittal LTD., will utilize a four color

catalog with a different cover including the company logo and contact address.

We have developed a price sheet to be enclosed with each catalog.

Upon release of a new catalog, we will need to check into the financial feasibility of utilizing

direct mail for bulk distribution. Certainly, the main task will be to clearly define the message of

our sales literature to make certain that we are selling the company, rather than the products.

 Direct mail

 Grand opening

 Industry specific trade shows and other local business events

 Internet marketing word of mouth

All marketing decisions with regard to specific media choices, frequency, size and costs will be

conducted on an ongoing basis with careful consideration of results (generated returns).

5.5Pricing strategy

Our retail and corporate customers are especially sensitive to service value. Mittal

LTD., must ensure that price and products are perceived to be a good value to our

customers. High quality products will be offered at a reasonable price, but the price

will certainly not be the lowest in the country.

Therefore, our pricing strategy will be competitive within the various product range,

but will not rely on the selling price to overshadow other advantages of doing

business with our company, such as diverse line of high quality products, that are
 readily available, reasonable priced, and backed by service excellence and on-time

delivery.

5.6Sourcing strategy

There are several India based manufacturers and suppliers of notebooks, notepads,

pens and other stationery items.

All the selected manufacturers produce and supply high- quality, energy-efficient

machinery and materials for producing the products and they compete primarily on

price.

Maintaining low levels of inventory will help to reduce the cost of financing, handling

and storage. However, too low inventory levels may also result in lost sales and

unhappy customers. Therefore, we will strive to implement the just-in-time operating

environment. This will be achieved by working closely with our suppliers to

coordinate and schedule shipments so that goods and materials arrive just at the time

they are needed.

We will purchase our inventory both from local wholesalers and direct from

manufacturers. Because of our past work experience in purchasing materials and

equipment, we have a vast number of suppliers contacts within the industry.

Ultimately, these suppliers will help us to achieve lower cost-of-goods and reach our

financial performance objectives.

 5.7Location and facilities

The company‟s location is very favorable, providing easy availability from raw

materials, electricity, labors. Accordingly, the rent that was accounted for in this plan

is lower than in other areas of city.

The advantages of the chosen location include:

 Plenty of space for constructing warehouse.

 Excellent central location with easy access to major destinations.

 Easy availability of electricity, and other transport facilities.

 Easy availability of raw materials at low cost.

 All utilities required for operating a restaurant are available.

All these characteristics of the location are consistent with Mittal LTD. goal of providing

excellent products.

As the company gains community recognition, and our country is developed, further expansion to

one or more city will be considered as a possible second stage capital investment option.

6.0Management summary

Our management is expected to use resources wisely, operate profitably, pay debts, and abide

by laws and regulations. Our management philosophy is based on team work, responsibility,

and mutual respect. People who work at Mittal LTD., would want to be part of our team

because we operate in an environment that encourages creativity, diversity, growth, and

performance.
 Sonika will be the manager of Mittal LTD., assisted by her co-owner Raj. Raj has

successfully owned and operated a similar business in New York and have more than three

years‟ relevant experience in the industry.

6.1Personnel Plan

The personal plan reflects the need to bolster our capabilities to match our

positioning. Mittal LTD., will have the following staff:

 Manager

 Employees

 Skilled staff

 Semi-skilled staff

 Unskilled staff

In our experience, a team of multi skilled employees works best for our kind of business.

Working as a team is critical to our success. We recognize that human resources are Mittal LTD.,

most valuable assets. Our personnel strategy focuses on selecting, training, rewarding, and

stimulating all employees in order to build employee loyalty, and increase performance.

It will be easy to find and select the best new members of our team.

As our manufacturing industry will open on all the days from 8:00 to 11:00 pm, the team of

employees can operate effectively only by using alternative work schedules that take into account

the busiest periods of day.

In addition to salaries, important bonuses and incentives are included in the personnel table, that

will be used to reward employee performance, on a pay-for-performance basis. The comerstone

of our personnel plan is to maximize productivity and minimize labor burden of the company‟s

operating expenses, while maintaining strong employee commitment to the success of operations.

Employees that perform well are eligible for various types of performance-based pay, such as

cash bonuses, awards, etc.

The ultimate goal of all our employees is to meet or exceed our customers‟ expectations.

Our continuous improvement policy encourages all our employees to continually look for ways to

keep updated with the latest technology, to improve processes, reduce costs and save time. This

approach serves the goal of reducing costs and delivery times, and increasing the service quality

and customer satisfaction.

Personnel

Plan

FY 2020 FY 2021 FY 2022 FY 2023 FY 2024

Manager 10,00,000 10,20,000 10,50,000 11,00,000 11,20,000

Skilled 3,00,000 3,05,000 3,25,000 3,45,000 3,50,000

workers

Unskilled 1,50,000 1,58,000 1,70,000 1,85,000 1,90,000

workers

Other 0 0 0 0 0

Total people 4 4 4 4 4

Total Payroll 14,50,000 14,83,000 15,45,000 16,30,000 16,60,000

7.0Financial Plan

According to our conservative estimates, Mittal LTD., is expected to maintain a healthy

financial position over the next five years. The following plan outlines the financial

development of our company. The business will be initially financed by a 4,00,000 five-year

term loan and a total capital investment of 8,00,000 by Sonika and Raj plus 6,00,000

investments from an investor.

The source of repay the loan will be cash flow generated from operations. The company will

also finance growth through cash flow. After an initial period of five years, the company will

be able to make a further expansion. At that time, it is envisioned that and bank loan or equity

funding will be sought to finance the new development, in addition to retained earnings.

The projected financial statements have been prepared in accordance with the general

accounting principles, and necessarily include some amounts that are based on reasonable

estimates and judgement. For accounting purposes, the long-term assets are expensed using

the straight-line depreciation method, and inventory is accounted for based on the First-In,

First-Out(FIFO) method.

The following section outline important financial information.

7.1Break-even Analysis

For our break-even analysis, we assume running costs of approximately 3,00,000 per

month, which include payroll, utilities, insurance, rent and other fixed costs. We need

to sell about 12,000 notebooks for minimum 25 per month to break even, based on

our assumptions.

Mittal LTD., is expected to break even in the sixth month of operations.

7.2Projected Profit and Loss

We expect to be profitable in the first year of operations, with profits increasing over

the next four years, as we establish and increase our customer base.

The following table and charts show the projected profit and loss for five years.

Pro Forma FY 2020 FY 2021 FY 2022 FY 2023 FY 2024

Profit and
loss
Sales 47,50,000 60,20,000 70,98,000 71,00,000 72,00,000
Direct cost of 30,40,000 31,92,000 41,35,000 43,00,000 43,00,000
goods
Other 15,000 16,000 18,000 18,500 19,750
production
expenses
Cost of goods 30,55,000 32,08,000 41,53,000 43,18,000 43,19,750
sold

Gross 16,95,000 28,12,000 29,45,000 27,82,000 28,80,250

margin
Gross 35% 46% 41% 39% 40%
margin %

Expenses
Payroll 14,50,000 14,83,000 15,45,000 16,30,000 16,60,000
Sales and 22,000 15,000 12,000 10,000 10,000
marketing
and other
expenses
Rent 60,000 66,000 68,000 --------- ---------
Other 5,000 6,000 6,900 5,000 10,000
Total 15,37,000 15,70,000 16,31,900 16,45,000 16,70,000
operating
expenses
 Profit before 1,58,000 12,42,000 13,13,100 11,37,000 12,10,250
interest and
taxes
interest 72,000 64,800 57,600 50,400 43,200
expenses
Taxes ---------- 3,72,600 3,93,930 3,41,100 3,63,075
incurred
Net profit 86000 8,04,600 8,61,570 7,45,500 8,03,975
Net 1.81% 13.3% 12.14% 10.5% 11.16%
profit/sales

YEARLY PROFIT
900000
800000
700000
600000
500000
400000
300000
861570
200000 804600 803975
745500

100000 86000
0
FY 2020 FY 2021 FY 2022 FY 2023 FY 2024
 GROSS MARGIN

3000000

2500000

2000000

1500000 2812000 2945000 2880250

2782000

1000000 1695000

500000

0
FY 2020 FY 2021 FY 2022 FY 2023 FY 2024

7.3Projected Balance Sheet

We expect a healthy growth in net worth and a healthy financial position. We do not
project any real trouble meeting our debt obligations, as long as we achieve our
specific objectives.
The following table is the projected balance sheet for five years.

FY 2020 FY 2021 FY 2022 FY 2023 FY 2023

Assets
Current
assets
Cash 50,000 80,000 60,000 70,000 1,00,000
Accounts 1,00,000 75,000 80,000 70,000 80,000
receivable
Inventory 60,000 70,000 80,000 90,000 80,000
Other 30,000 35,000 28,000 30,000 30,000
current
assets
Total 2,40,000 2,60,000 2,48,000 2,60,000 2,90,000
current
assets

Long term
assets
Total Long 20,00,000 18,00,000 20,52,000 18,00,000 21,00,000
term assets
Total assets 22,40,000 20,60,000 23,00,000 20,60,000 23,90,000

Liabilities FY 2020 FY 2021 FY 2022 FY 2023 FY 2024

and capital

Current
liabilities
Accounts 4,00,000 3,60,000 4,00,000 3,00,000 3,50,000
payable
Current 5,00,000 5,50,000 6,50,000 6,00,000 5,00,000
borrowing
Other 60,000 50,000 50,000 40,000 60,000
current
liabilities
Subtotal 9,60,000 9,60,000 11,00,000 9,40,000 9,10,000
current
liabilities

Long term 10,00,000 9,00,000 11,00,000 9,40,000 9,10,000

liabilities
Total 19,60,000 20,10,000 21,25,000 18,35,000 19,90,000
liabilities

Total capital 2,80,000 2,00,000 1,75,000 2,25,000 4,00,000

Total 22,40,000 20,60,000 23,00,000 20,60,000 23,90,000

liabilities
and capital
7.4 Long-term plan
This is a five-year plan. Projections for further periods are not considered relevant at
this time

7.5 Important Points

1) The sales growth is assumed, there is no such definite percentage for sales growth.
2) The Profit & Loss A/C and Balance Sheet of this company is prepared by
assuming the amount of profit and assets and liabilities of the company.
3) There is no fixed amount or fixed percentage of growth rate.
4) It is been assumed that business may have ups and down in the real scenario.
Sourcing Strategy

There are several U.S.-based manufacturers and suppliers of pizzeria equipment, food
supplies, ingredients, packing, and accessories for for Sandwich preparation.

The specific restaurant equipment vendors will be chosen soon, based on competitive
bidding process.

All the selected manufacturers produce and supply high-quality, energy-efficient kitchen
and restaurant equipment, or materials for Sandwich preparation and delivery, and they
compete primarily on price.

Maintaining low levels of inventory will help to reduce the cost of financing, handling and
storage. However, too low inventory levels may also result in lost sales and unhappy
customers. Therefore, we will strive to implement the just-in- time operating environment.
This will be achieved by working closely with with our suppliers to coordinate and schedule
shipments so that goods and materials arrive just at the time they are needed.

Many of the selected suppliers have already committed to special deals for us, such us
waiving their buy-in requirements, sales referrals, and discounts for early payment (offering
terms like 2/10 n/30 for example). Other discounts can be negotiated gradually, depending
on the increasing quantity purchased, and customer loyalty. We need to focus on making
sure our volume gives us negotiating strengths.

We will purchase our inventory both from local wholesalers and direct from manufacturers.
Because of our past work experience in purchasing materials and ingredients for Sandwich
preparation, we have a vast number of supplier contacts within the industry. Ultimately,
these suppliers will help us to achieve lower cost- of-goods and reach our financial
performance objectives.
ESTIMATED MARKET SIZE AND MARKET SHARES

AIDMA widely accepted model describing the psychological process leading up to the
consumer‟s decision to purchase a product. This model is similar to AIDA model. The AIDMA
Model was first advocated by Roland Hall, an American economist, around 1920.

According to this model, there are five key processes: Attention, in which the consumer first
notices the product or advertisement, followed by Interest, Desire, Memory, and Action. This
model has been used extensively in the advertising and marketing industries.

Attraction Interest Desire Memory Action

AISAS is a process model of consumers purchasing activities in the Internet age. AISAS is a
consumption behaviour model that has been advocated by Dentsu since 2004. It was developed
to observe behaviours based on the understanding that the Internet has become prevalent, and
that consumers now have access to environments in which they can obtain and transmit
information themselves.

In this model, the key processes are: Attention, in which the consumer first notices the product or
advertisement, followed by Interest. After this, the consumer Searches for information, and then
makes a purchase (Action), after which information is shared with others. In comparison to
“AIDMA,” the psychological process has become more compact, and the Action process has
expanded.

45
 Attraction Interest Search Action

Share

These changes are shown how presences in ONLINE are important for brands. Brands can able
to create awareness and internet without ONLINE. But it will not lead to action in current
scenario. Customers need more information in present era; they are information seeker and
always search for best deal. Brands can‟t sustain without ONLINE media.

Advantages of ONLINE Marketing

ONLINE Advertising is increasingly an inherent budgetary component of many organizations
today. Organizations of all sizes use the medium to promote their products and services. So well,
why do so many organizations use the medium? Simply put, it is due to the numerous advantages
that online advertising offers. These are discussed in the paragraphs ahead.

Reach

The ability of the online medium to target a certain demographic of users is one of the greatest
advantages of ONLINE advertising. In addition, the geographical reach of the online medium is
far greater than that of traditional media. It‟s not only cost effective to achieve a wider
geographic area but the ads can also be targeted to the desired audience. For example, if an
advertiser is keen on selling his or her products targeted to a certain demographic of people, it is
quite possible through online advertising. ONLINE advertising has matured to the extent that
web publishers, media agencies and advertisers themselves know the optimal ways and websites
for a certain category of products or services.

Measurement

With various tools becoming available, tracking effectiveness of ad campaigns is becoming

possible today. In other words, measuring Return of Investment (ROI) is increasingly possible
today. Organizations that were previously reluctant to spend online, now realize that the online
medium does offer means to alleviate any such fears. Moreover, when properly designed online
46
marketing campaigns generate the desired results, advertisers are further encouraged to continue
advertising online.

Interactive and Engagement

The Internet is arguably the most interactive and engaging medium among various others.
Interactive campaigns have become a norm with the power of the online medium. One such
advertisement worth mentioning is the campaign by AXE where the end user could alter the
smile of a woman as he/she liked to i.e. in an interactive framework. The advertisement struck an
instant chord with the youth to which AXE the brand is positioned for Customers are basically
just a click away from the advertisers. In other words, direct response between end users and
advertisers is possible through the online medium.

Time

Through the Internet, an advertiser can reach a desired target group or demographic in a much
shorter time frame. For example, if an advertiser needs to plan some sort of ambush marketing,
the online medium can be an effective means of achieving it. Even otherwise i.e. for regular
marketing campaigns, the total time necessary to complete an online advertising campaign is less
than that of traditional advertising methods.

Cost

When compared to traditional forms of advertising, ONLINE advertising is

cheaper. Various payment models are available between the advertisers and
publishers. Many a time, advertisers are charged only when visitors click on
their ads. The various payment models are discussed in detail in the next
section.

7.1 Monetary term in ONLINE Marketing

⮚ Cost –Per- Action (CPA): Cost of advertising based on a visitor taking some specifically
defined action in response to an ad. “Action” include such thing as a sales, transaction, a
customer acquisition or a click.

⮚ Cost- Per -Click (CPC): Cost of advertising based on the number of clicks received.

47
 ⮚ Cost- Per-Thousand (CPM): The standard unit for buying or selling Internet
advertising. The thousand stands for „thousand advertising impression or views‟.

⮚ Pay- Per- Impression: Online advertising where an advertiser pays a pre-agreed price
each time a user clicks on their advertisement. The cost for the click is often negotiated
through auction, with ad placement determined by the relative size of the bid, as well as
other factors.

⮚ Pay-Per-Inclusion: Search engine marketing programs that guarantee web site listing for
specific keyword search term for a fee.

⮚ Pay-Per-Lead: Paying to acquire leads from an outside party at a set rate or amount per
lead.

ONLINE marketing is a new trend in marketing, unlike traditional marketing most of companies
not use their own marketing channels for ONLINE marketing mostly it can be outsourced to
third parties like ONLINE marketing agencies like Medium consultancy ltd. Companies like
Medium generating revenue using ONLINE marketing it has great impact on revenue model of
these companies. Spending‟s of various companies on ONLINE marketing is a revenue for
ONLINE marketing agencies like Medium.

8.1 ONLINE agencies: types and services

ONLINE agencies are as varied as the needs of the advertisers and marketers who hire them. At
the high end, for global enterprises, are the agency holding companies with hundreds of full-
service ONLINE agencies around the world. There are also boutique and specialty agencies that
provide channel-specific ONLINE marketing services such as mobile messaging programs,
social media marketing, or SEO link-building campaigns. And there are agencies that focus on
strategy and professional services, such as branding or web design. Like any organization, each
type of agency has its own strengths, weaknesses, and culture. ONLINE agencies also can be
differentiated by their focus on professional services versus proprietary technology platforms.
Agencies that emphasize their professional services capabilities recommend and use third-party
technology such as PPC campaign management platforms, SEO tools, and social media
management platforms to manage their clients‟ data and ONLINE campaigns. These agencies
view their role as strategists that can analyse and interpret data to provide actionable results and

48
achieve their clients‟ goals.Agencies that develop and offer proprietary tools view their platforms
as a competitive advantage over third-party toolsets that are widely available. The plethora of
ONLINE channels has left many advertisers drowning in data. By providing technology
platforms that are built and customized to client needs, these agencies believe they are providing
unique and critical automation tools that collect, analyse, and optimize data for their clients.

8.2 The Benefits of working with a ONLINE agency

Agencies owned by large media or holding companies can provide the following benefits:

49
 CONCLUSION

Your conclusion should; reiterate the opportunity, highlight the key strengths of your plan,

summarise your vision, and remind the reader why your business is in a position to

successfully execute the plan. If you are looking to raise funding with your plan, you

should detail the finance required

A start up summary business plan includes the description of your products and services,

the structure of your business, your target market, marketing strategy, funding

requirements, financial projections, and licensing requirements, among others. It serves as a

roadmap for

your business.

However, there are elements of a business plan that are absolutely key to making sure that

the reader understands how your company works and plans on growing....

You should include:

Production or Service Delivery;

Quality Control;

Inventory;

Suppliers;

Credit policies;

Legal environment;

Location.

50
 BIBLIOGRAPHY

1. BOOKS

 Robbins P. Stephens, Organizational Behavior, Prentice Hall, 7th Edition, Chapter 16, pages

636-641.

 Koontz Harold & Weihrich Heinz, Essentials of Management, Mc Graw Hill, 5th Edition,

Chapter 11, pages 217-245.

 Decenzo A. David & Robbins P. Stephen, Personnel/HR Management, Prentice Hall, 3rd

Edition, Chapters 6,7 & 8, pages 117-209.

2. Magazines

 India Today

 Today‟s traveller

 Business Today

3. News Paper

 Times of India

 Hindustan Times

 Economic Times

4. Web sites

 www.Tata Motorsindia.com

 www.indiatimes.com

REFERENCE:

Secrets of small business success Newell M (1985)

Retail plan of a fast food Business by Abdul Jamil Sharify

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www.fundinguniverse.com/sample-business-plans

www.score.org

www.sandwichpanel.com

www.virtualrestaraunt.com

http://www.interstellar-solutions.co.uk/business-planning.php

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