Business Plan

(U n’ Me)

Submitted To:
Mr. Manqoosh-ur-Rehman.

Submitted By:

Ahad Ali (063305-010)

Mahed Aamir (063305-038)
Anees-Ur-Rehman (063305-016)
Mohammed Yasir Naim (063305-026)
Mohammed Kazim Amjad (063305-006)
Fazal Hussain (050804-011)

Date: 27/06/09

1
 Table of contents:

Acknowledgements............................................................................................................3
Executive Summery:..........................................................................................................4
General Company Description.........................................................................................6
Mission Statement:............................................................................................................6
Form of Ownership:..........................................................................................................6
Industry History:...............................................................................................................6
Most important Strength and core Competencies:.........................................................7
Variation in price...............................................................................................................8
Significant challenges the company Faces now and in the near future:.......................8
Products and services:.......................................................................................................9
Marketing plan:...............................................................................................................10
Market research:.............................................................................................................10
Features and Benefits:.....................................................................................................13
Products..........................................................................................................................13
Services: ........................................................................................................................13
Competition:.....................................................................................................................16
Porters Five Forces........................................................................................................16
Competitive Analysis:......................................................................................................17
For competitor A:...........................................................................................................17
For Competitor B:..........................................................................................................19
For competitor C:...........................................................................................................21
For U n’ Me:...................................................................................................................24
Niche:................................................................................................................................26
Marketing Strategy: ......................................................................................................27
Promotion:......................................................................................................................27
Advertising:....................................................................................................................27
Promotional Budget:......................................................................................................28
Pricing strategies:...........................................................................................................28
Location:...........................................................................................................................28
Distribution Channel:......................................................................................................29
Operational Plan..............................................................................................................30
Daily operation of the business: ....................................................................................30
Location:...........................................................................................................................31
Organizational chart.......................................................................................................32
Management & organization:.........................................................................................34
Harvest or Exit Strategy:-...............................................................................................35
Financial Analysis:...........................................................................................................36
Balance Sheet...................................................................................................................37
Internal Rate of Return - IRR........................................................................................37
Conclusion:.......................................................................................................................39

2
 Acknowledgements

“First of all we are thankful to one and only the Almighty Allah for always guiding us in
the thick and thin and giving us strengths and courage to complete this project without
Him nothing would have been possible. Then we would like to thank our parents whose
prayers and support have always been influential in our lives. Then we would like to
thank all the people who directly or indirectly helped us out in this project we would like
to thank all the organizations whose data we used in this project

3
Executive Summery:
The company deals in garments business consisting of readymade and customized
products. Products are cotton shirts and trousers. This business is based on Partnership in
which each partner will get each share. The main focus of the company is to provide
customized products according to customer preferences. The services which our
business is giving are Customization, Home delivery, Membership, Free alteration for
members, Special discount package for members.
U n’ ME garments is a small venture and on its initial stages. It does not have enough
time and finance for primary market research. Keeping in mind the position of the
business at the moment an appropriate strategy would be to conduct the secondary
research as it will not prove to be a burden on the finances of the company. It also will be
convenient option for the company.
Niche market of U n’ Me is students of UMT hostel and a small segment of a big industry
is focus of operation i.e. UMT hostel which comprises of 500 – 600 students.
The products including Dress shirts and formal trousers are source of satisfying needs of
target customers.
The profile of target customer includes from middle class, upper middle class, male
gender of age between 18 – 30 with income level between 8 – 15k.
The unique corner of the U n’ Me Garments is that it is accessible for its target market as
it will be operating in the UMT hostel which is the main point of focus. It can easily
interact with its customers leading to various improvements in its operations, and also
better understand the changing preferences of its target customers.

U n’ Me Garments will use print media for creating awareness to its customers, because
the print media is the most appropriate strategy for it to reach to its target customers. Also
the limited marketing budget does not allow it to go on large scale marketing.

4
U n’ Me will focus on penetration pricing. This price is deliberately set at low level to
gain customer's interest and establishing a foot-hold in the market. This business will deal
only on cash basis
The location of U n’ Me is very convenient for its target customers to come and have
shopping there. It is located in the heart of its target market. As parking facilities are there
in the hostel which will fulfill the requirements of customer
Daily operations of the business are Up to date financial statement, Proper placement of
the product, Order management, Stock management, Cleanliness.
U n’ Me will start its operations with the capital of Rs. 0.696 million which will be total
equity based. The loan facility would not be availed. The two bikes costing Rs. 140000
will be purchased solely for business purposes. The proposed expenditure for the office
and furniture fixes will be closed to Rs. 50,000.
U n’ Me will sell their products or services through its retail outlets, and through its own
sales force. If U n Me does not get maximum profit than the business go for Exit or
harvest strategy.

5
General Company Description

Mission Statement:

“To produce innovation, value intensive products by cultivating the creativity and
maintaining satisfied customers and set the standards, improve each day and have some
fun”

Form of Ownership:

This business is based on Partnership in which each partner will get 20% each. Written
contract will be made with the help of legal advisor if any one wants to leave his shares,
the shares will be internally divided among other four.

Industry History:

Readymade garment industry has emerged as one of the important small scale industries
in Pakistan. Its products have large demand both at home and abroad. The local
requirements of readymade garments are almost wholly met by this industry. Its exports
in 1999-2000 stood at US $ 772 million or 8.5% of the total exports.
The readymade garment industry started in 70's in Pakistan. With the passage of time and
industrialization, this industry expanded very rapidly. The majorities of the units making
cotton fashion garments are medium and small-size in terms of machines, workers and
output, with a few notable exceptions and scattered throughout Pakistan. The importance
of this industry lies in the value it adds to indigenous raw material - cotton + blended

6
cloth - thereby substantially increasing the revenue from its sale in the international
market.

Most important Strength and core Competencies:

• No Legal Barrier:
As it is a small venture and it does not need to get registered.

• No competitors in the vicinity:

This is competitive edge for the company to start a business in UMT hostel as no one has
taken an initiative to start business of this nature.

• Customization:
The main focus of the company is to provide customized products according to customer
preferences.

• Customer service:

The main factors of customer service in which company is going to serve customers are:
 Free home delivery
 Membership cards
 After sale services
 Friendly atmosphere
 Customization of products.

7
Variation in price
Price will be varied according to the levels of customization. There will be no variance in
the price of ready made products. Whereas price will be varied for customized products
according to the size, quality and design of product

Significant challenges the company Faces now and in the near future:

Less Capital:

It is a small venture and more over shareholders do not have enough capital to invest.
Another reason is that the business is in initial stage.

Marketing:

Due to limited capital and shortages of budgets, it is not possible to advertise our brand at
higher level. Because of this, our product awareness in the market will be minimum.

Inexperienced:

One of the challenges is that all the share holders’ don’t have any kind of business
experience moreover the company has no experience of negotiating with different
suppliers and vendors.

New Brand:

New brand at its initial stage is itself a challenge. As discussed above that due to shortage
of capital we are unable to promote this new brand for better awareness and desired out
comes.

8
Long term:

The target of the company is to achieve the breakeven in the first six months. From this
point onward we will strive to grow at a constant rate to open a new outlet each year so
that vision of company can be achieved.

Products and services:

Products
Formal shirts and trousers (cotton) with colors, sizes, variety, styles

Services:

• Customization

• Home delivery

• Membership

• Free alteration for members

• Special discount package for members

Competitive Advantage Competitive Disadvantage

Customization No awareness
Low Price Small Venture
High quality Un experienced
Easily reachable for target market

9
Pricing Fee:

Customized trouser
Ready made trouser

Customized shirts 499

Ready made shirts 399

Marketing plan:

Market research:

Market research is necessary for all kind of businesses but especially before the
commencement of new businesses. It clarifies different aspects regarding customers
demand, their behavior, and their buying power, their attitude towards the product, their
likings and disliking. It also clarifies about the potential customers of the business and
also helps the company to focus on those customers more efficiently and effectively. It
will help a business to identify right opportunity and the time at which to hit these
opportunities. Market research gives the company very concrete information which is
close to the accurate because right information is very necessary regarding target markets,
their demands, their norms and values, ethics related to the business and it enables the
company to minimize the risks.

U n’ ME garments is a small venture and on its initial stages. It does not have enough
time and finance for primary market research. Keeping in mind the position of the
business at the moment an appropriate strategy would be to conduct the secondary
research as it will not prove to be a burden on the finances of the company. it also will be
convenient option for the company.

What barriers to entry keep potential new competitors from flooding into your
market?

10
 • High capital cost:
It is not a barrier for the new competitors as any one can start with a low capital.

• High production cost:

It can be a barrier and can not be a barrier because it depends on the references of the
business entity.
• High marketing cost:

Marketing is not a barrier for this business because a small business does not require
marketing at a bigger level.

• Consumer acceptance/Brand recognition:

It can be a barrier because it is always difficult for a new brand to capture the target
market and due to low marketing budget it is almost impossible to create a brand
recognition at initial stage.

• Training/skills:

It can be a barrier for new company because if existing company have good marketing
skills, communication skills and technical skills related to garments etc then it will
always be a barrier for new company to compete the existing company.

• Unique technology/patents:

Because it is a small business therefore it doesn’t require any unique technology and
patents.

11
 • Shipping costs:

Shipping cost is not a barrier. Because it is a small business and usually small businesses
not go for such big segment.

• Tariff barriers/Quotas:

It is also not a barrier because at this small level no legal barrier, government
intervention, taxes are involved.
How could the following affect your company?

Change in technology:

There are two ways of technology change

• Positive

• Negative

If positive change occurs i-e development in technology it will result in increase in

production whereas decrease in production cost less labor force which will decrease labor
cost, increase quality, new innovative style and design occurs, reduced lead time and
increase in flexibility and vice versa for negative change.

Government Regulations:
There is no involvement of government in our business because it is a small business and
it is not opening on a large scale. This business is just for the selected and specific areas.

• Change in your Industry:

12
It will not affect if there is any change in this industry because our business is based on
customized products as well and due to this new trends and fashion will be adopted
accordingly.

Features and Benefits:

Products

Formal shirts and trousers (cotton) with colors, sizes, variety, styles.

Services:

• Customization

• Home delivery

• Membership

o Free alteration for members

o Special discount package for members

Customization:

Features Benefits
Design flexibility Any fashion desire of customer can be
fulfilled
Size variation Different demand of sizes can be met

Various color combination Different demand of colors can be met

Stuff of customer choice Getting stuff of customers choice

13
All these would lead to the higher customer satisfaction resulting in building customer
loyalty.

Home Delivery:
The important feature of home delivery is that it saves time of the customer, convenient
for them and it is value added service for our business.

Features Benefits
Time saving for customers Customers don’t have to go to the shop
convenience

Membership:

Features Benefits
Customer record Customer can order from anywhere with a
simple phone call
Different packages Discounts, money back guarantee
Updates Customer attraction

Products:
• Formal shirts
• Trousers (cotton)

Formal Shirts:

Features Benefits
Plain design For Official use
Check design For casual and official use

Trousers:

14
Features Benefits
plate less For formal and casual use
Wrinkle free No need to iron
Casual trousers comfortable

Customers:
• Age:

18-30years

• Gender:

Male

• Location:

UMT Hostel

• Income Level:

8-15k

• Social class/occupation:

Upper middle class

Middle class

• Education:

Undergraduate and post graduate

15
Competition:

Porters Five Forces

Bargaining power of Buyers:
Clothing is one of the three fundamental human needs. Everybody needs to buy clothing.
Clothing includes wearing apparel such as shirt, pants, among others. Buyers usually buy
in smaller quantities and do not purchase regularly. Buyers can also easily switch from
one competitor to another in case of product dissatisfaction or if they just want to try
other brands. The idea of custom-fit pants is still a fresh concept in the garments industry
and U and Me is dealing in customized product too; particularly in our business only few
buyers, particularly those in the upper middle, upper class, avail/can avail these products
because of the products’ perceived high-end status and high price.

Bargaining power of Suppliers:

U and ME will be dealing in pants and shirts which is made of cotton. Pakistan is likely
to remain the largest supplier of cotton and U n ME will buy cotton locally.

Substitute Products:
Ready-made retail products are considered substitute for custom-made clothing.
Moreover, the trend of many universities and offices which uses trousers and jeans has
been replaced by Formal pants. The fabric could also be replaced by other fabrics such as
those used in khaki pants and pants.

Barriers to entry:
Barriers to entry include local policies implemented in the textiles and clothing industry.
As far as U n Me is concerned there is no as such barrier in entering market.

16
Rivalry:
The garment industry is comprised of many players, both operating on a large scale and
small scale basis. Customers are free to change their suppliers thus creating high
uncertainty for competitors. In terms of origin and operating styles, competitors may
range from boutiques, specialty stores, bazaars, direct selling agents, department stores to
big malls. U and ME is a small venture and have the big threat of having new competitor
in the market.

Competitive Analysis:

For competitor A:

Factor Strength Weakness Competitor A Importance to

(D for Denim) customer
Products  • Dress
pants &
shirts

Price  • Shirts: Rs
499-600

• Pants: Rs
795

Quality  • 100%
Quality

• Checked
by
company

Selection  • Market
trend

17
 • Customer
demand

Service  • Alteration

• Shirt
fitting

Reputation  • Good

• Customers
come from
different
cities

Location  • Kareem
Market

Appearance  • Designer
(itself)

Sales Method  • At spot

sale

Credit Policies  • No credit

policy

• Only cash
basis

18
For Competitor B:

Factor Strength Weakness Competitor B Importance to

(Free Edge) customer
Products  • Dress
pants &
shirts

Price  • Pants: Rs
550
(normal)

• Pants: Rs
1650
(high)

• Shirts: Rs
450-650

Quality  • 100%
Quality

• Checked
washing

• 2-3
washing &
check

Selection  • Market
design

• Market
trend

19
 • Customer
demand

Service  • After sale,

exchange
the default
product

• Shirt
fitting

Reputation  • 2-2.5
years in
launching
their brand

• Good
reputation

• Customer
trust on
brand

Location  • In Kareem
Market.

• Placement
in Aqsa
garments
with some
other
brand like
River
Stone,
Radiation

20
 etc

Appearance  • By self
design
their
products

Sales Method  • At spot

sale

Credit Policies  • No credit

policy

• Only cash
basis

Advertising  • Through
Magazine
(Teen
club)

• Catalog

For competitor C:

Factor Strength Weakness Competitor C Importance to

(Brands) customer
Products  • Dress
pants &
shirts

• Cotton

21
 pants &
trousers

Price  • Dress
Shirts: Rs
450-650

• Dress
Pants: Rs
1050

Quality  • Import the

products
from
China,
Thailand
&
Indonesia

• Checked
by
company

Selection  • By owner
itself

• Market
trend

• Changing
preference
of people

Service  • Give six

months
warranty

22
 of Bubble
& Collar

Reputation  • Famous

Location  • Kareem
Market

• Launch 1st
shop in
Islamabad
& 2nd shop
in Lahore.

Appearance  • Designer
(itself)

Sales Method  • Prices are

not fixed.

• Bargaining

• Normal
profit
margin

Credit Policies  • No credit

policy

• Only cash
basis

Advertising  • Through
cables.

23
 • Poly bags

• Catalog

• Banners

For U n’ Me:

Factor Strength Weakness U n’ Me Importance to

customer
Products  • Dress pants
& shirts

• Cotton
trousers

Price  • Shirts: Rs
350-375

• Pants: Rs
550

• Trousers: Rs
500-550

• Customized
shirts: Rs
425-450

• Customized
trousers: Rs
600-650

Quality  • Quality
assurance

24
 by checking
our products
by washing
twice or
thrice

Selection  • Market
trend

• Customer
demand

Service  • Free home

delivery

• After sale
service

• Warranty (6
months)

• Membership

Reputation  • No

Location  • UMT
Hostel

• Sales office/
outlet:
Room # 44

• Storage
room:
Room # 242

25
Appearance  • Designer
(itself)

Sales Method  • At spot sale

• Home
delivery

Credit Policies  • No credit

policy

• Only cash
basis

Advertising  • Through
banners

• Leaflets

• Pamphlets

Niche:

A niche market is the subset of the market on which a specific product is focusing on;
Therefore the market niche defines the specific product features aimed at satisfying
specific market needs, as well as the price range, production quality and the
demographics that is intending to impact.

Niche market of U n’ Me is students of UMT hostel and a small segment of a big industry
is focus of operation i.e. UMT hostel which comprises of 500 – 600 students. The main
focus from these numbers is the business students and professionals. The products
including Dress shirts and formal trousers are source of satisfying needs of target

26
customers. The profile of target customer includes from middle class, upper middle
class, male gender of age between 18 – 30 with income level between 8 – 15k.

The unique corner of the U n’ Me Garments is that it is accessible for its target market as
it will be operating in the UMT hostel which is the main point of focus. It can easily
interact with its customers leading to various improvements in its operations, and also
better understand the changing preferences of its target customers.

Marketing Strategy:

Promotion:

• Banners.

• Leaflets.

• Pamphlets

• Word of Mouth.

Advertising:

U n’ Me Garments will use print media for creating awareness to its customers, because
the print media is the most appropriate strategy for it to reach to its target customers. Also
the limited marketing budget does not allow it to go on large scale marketing. As it is
operating on small scale and the target market can be reached through them, there is no
need of using other media for advertising. And whenever new products will arrive, new
packages for sales promotion U n’ Me garments will go for advertising using appropriate
mediums.

27
It is an effective strategy because pamphlets will be displayed on the notice boards which
are unavoidable for everyone. It is a business operating on small scale requiring
marketing on small scale. The marketing budget is weak allowing only marketing on
small level. The target market is small so print media is the appropriate medium to create
awareness for small portion of market.

Promotional Budget:
10% of the total capital will be allocated for the above mentioned advertising. More
portion of the marketing budget will be spent on Leaflets, pamphlets with very small
proportion for banners.

Pricing strategies:
U n’ Me will focus on penetration pricing. This price is deliberately set at low level to
gain customer's interest and establishing a foot-hold in the market.

This business will deal only on cash basis

Location:

In the world of business, location is extremely important. Most of us have heard the
saying "location, location, location". There is a reason it is a saying and it is important for
everything from the perfect photograph and romantic settings as it is in the world of real
estate and business success. Spend time scouting out locations that you feel would be
great places to open a coffee franchise business and ask yourself the following questions.

Is this is a high traffic location? Most people are rather lazy by nature. You want to find a
location that people will drive by often.

www.linkroll.com
The location of U n’ Me is very convenient for its target customers to come and have
shopping there. It is located in the heart of its target market. As parking facilities are there
in the hostel which will fulfill the requirements of customer. It also posses a required

28
space for an effective outlet. It has sufficient display area, shelf space, trial room, and
mirrors etc.

This location is also suitable and consistent with the image of this business because it is
emphasizing as indoor business and this location is consistent with the nature of business,
where U n’ Me can easily connect with the target audience. U n’ Me providing such a
space which will fulfill the demand of customers as it will be approachable to the
customer. It will provide friendly atmosphere for them as such, U n’ Me will be the only
leading company dealing in garment industry in the UMT hostel, where there is no such
kind of competition. The nearest competitor to the location of U n’ Me is Kareem market.
Therefore location will be a better competitive edge for U n’ Me.

Distribution Channel:

U n’ Me will sell their products or services through its retail outlets, and through its own
sales force.

Marketing strategies of U n’ Me is very effective as it is closely connected to the target

customer. U n’ Me is using catalogs, brouchers and banners for its advertisement and
promotions. It is also suitable with the nature of the business as it will require fewer
budgets which will reduce the cost of business. distribution strategies are also effective
because garment business deals with direct sale practice. Pricing strategies are also
flexible. U n’ Me is using penetration method for its pricing as its target market is the
middle class income group.

29
Operational Plan

Daily operation of the business:

Following will be the daily to daily operations of the business:

• Up to date financial statement.

• Proper placement of the product.
• Order management.

30
 • Stock management.
• Cleanliness.

Location:
Yes, it is convenient for customers to come and have shopping here. We are located at the
heart/middle of our target market.

As parking facilities are there in the hostel which will fulfill the requirement of
customers. We also possess a required for an effective outlet. We have sufficient display
area, shelf space, trial room, mirror etc. This location is also consistent wit the image of
this business because we are emphasis it as indoor business. And this location suits with
the nature of business. Where U n Me can easily connect with the target audience. U n
Me is providing such a space which will fulfill the demand of customers as it will be
easily approachable to the customers. It will provide a friendly atmosphere for them. As
such U n e will be the only leading company dealing in garment industry in UMT hostel.
Where there is no such kind of competitor. The nearest competitor to the location of U n
Me is Kareem Market. Therefore location will be better competitors edge for U n Me.

Legal Environment:
There is no legal environment because it is a home based business.
Permit:
Permission from UMT management and administration.
Health, workplace, or environment regulations:
No
Special regulations covering your industry or profession:
No
Zoning or building code requirements:

31
No
Insurance & Trademark:
With the expansion of our business, we will go for trademarks & copyrights then
insurance will be part of our plans.
Personnel:
Number of employees:
8 (including 2 tailors).
Type of Labor:
Both skilled and professional.
Where do you find new employees?
Quality of existing Staff:
Six are skilled & qualified while two are skilled & professional.
Pay Structure:
Profit will be shared between 6 shareholders after paying all the expenses.
Training methods & requirements:
Not required.
New hiring:
As we have described in our goal that they will strive to open a new outlet every year for
this purpose, it will definitely require some professionals and skilled person who have
Market experience.

Organizational chart

32
Who does which tasks?

• Marketing & Sales department:

Mr. Ahad Ali will be the head of this department with Mr. Mahed Aamer & Mr. Fazal
Hussain will be accompanying him.

• Management Department:
Mr. Anees ur Rehman is the head of management department with Mr. Kazim Amjad will
accompanying him.

• Finance Department:
Mr. Yasir Naim is the head of finance department with Mr. Ahad Ali will accompany him.

• Contract workers:

For the production department, we will have contract workers for assistance.

33
Management & organization:

Manages Business on daily basis:

• Finance: Mr Yasir.
• Operation: Mr. Kazim
• HR: Mr. Anees
• Marketing : Ahad Ali
• Quality Assurance:Mahed Aamer

Experience by person to business:

All the members of each department don’t have any practical experience regarding their
respective field but the positive point being the student of Business Administration, they
know the strategies and policies of operating & launching a business & how to make it
successful by utilizing their skills and knowledge.

Distinctive competencies:

• Way of communication
• Customer care
• Friendly environment
• Customer relationship management

Plan for continuation of Business:

In case, if any shareholder want to withdraw from the business, the other members try to
cover the gap by utilizing their efforts & if the situation arises when U n Me will need a
specialist person then they will go for new hiring.

34
Harvest or Exit Strategy:-

If U n Me does not get maximum profit than partners of U n Me will decide for
exit. The time is come when partners will not be able to get more through this
business then the partners will look to harvest it, U n Me will be sell it to another
entrepreneur who will be interested in this business. Favorable exit strategies are
to sell the business, U n Me sell their assets of the business or merge it with
another business and if there come such situation when there is no one in the
Market to purchase it and don’t want to Acquire or merge with our Business then
partners will go for another strategy that will be to sell out the assets to different
shops.

35
Financial Analysis:
U n’ Me will start its operations with the capital of Rs. 0.696 million which will be total
equity based. The loan facility would not be availed. The two bikes costing Rs. 140000
will be purchased solely for business purposes. The proposed expenditure for the office
and furniture fixes will be closed to Rs. 50,000.

The proposed capacity utilization for the first year is 80% which would yield sales about
Rs. 3.8 million which could be a perfect start for an organization. The COGs for the first
year calculated are 141,000 and so it would generate a gross profit of Rs. 3,695,000. The
proposed tax provision rate is applied at 15% on the operating profit. And at the end of
the first year the projected net profit for the organization should be Rs. 3,033,000. The
ROE and ROI will be 436.

Return On Equity - ROE

The amount of net income returned as a percentage of shareholders equity. Return on
equity measures a corporation's profitability by revealing how much profit a company
generates with the money shareholders have invested.

Return On Investment - ROI

A performance measure used to evaluate the efficiency of an investment or to compare
the efficiency of a number of different investments. To calculate ROI, the benefit (return)
of an investment is divided by the cost of the investment; the result is expressed as a
percentage or a ratio.
www.investopedia.com/terms/r/returnoninvestment.asp

Cash flow
A cash flow statement or statement of cash flows is a financial statement that shows
how changes in balance sheet and income accounts affect cash and cash equivalents, and
breaks the analysis down to operating, investing, and financing activities.
http://en.wikipedia.org/wiki/Cash_flow_statement

36
The projected cash flow statement for the first year at 80% capacity utilization states that
company which started at Rs. 0.696 million will have total sources of fund 3.6 million.
The opening cash balance from the start of the business is Rs. 0.5 million which will
make the closing cash balance of the company about Rs. 3.3 million which include the
deducted depreciation value. If at the end of the year the company is able to achieve this
target it would be an ideal situation for the company which started at a very low level. If
this projected target the plan of opening a new outlet after an year could be achieved as
the company would have enough cash resources. This would help build the reputation of
the company.

Balance Sheet
A financial statement that summarizes a company's assets, liabilities and shareholders'
equity at a specific point in time. These three balance sheet segments give investors an
idea as to what the company owns and owes, as well as the amount invested by the
shareholders
http://www.investopedia.com/terms/b/balancesheet.asp

The projected balance sheet of the company for the first year at 80% capacity utilization
indicates that it would have assets of Rs. 3.7 million consisting of Rs. 3.5 million of
current assets and close to Rs. 0.2 million of fixed assets. The accumulated depreciation
for the year would be Rs. 38000 which would decrease the value of fixed assets by Rs.
0.15 million. At the end of 9th year the value of fixed assets would be less then the
depreciation value which indicates the buying of new fixed assets. The equity and
liability side indicates the same value which totally consists of equity as no loan facility
or accounts payable would be utilized. The retained earnings for the year one would add
up in the capital invested at the start of the year which would make it Rs. 3.7 million.

Internal Rate of Return - IRR

The I.F.R.R for the company is 191.707%.
The internal rate of return (IRR) is a rate of return used in capital budgeting to measure
and compare the profitability of investments. It is also called the discounted cash flow

37
rate of return (DCFROR) or simply the rate of return (RORThe discount rate often used
in capital budgeting that makes the net present value of all cash flows from a particular
project equal to zero.
http://en.wikipedia.org/wiki/Internal_rate_of_return

The break even analysis of the company shows that if a company covers 16.2% of the
total capacity utilization it would be enough for the company to reach its break even that
would prevent it from the danger of loses. But the company has to perform really well to
achieve this target as it would be not easy in any way. In order to calculate the break even
for the company the total fixed cost is divided by the contribution margin multiplied by
100. This would generate break even for the company. This break even analysis is based
on the 100% capacity utilization by the company.

38
Conclusion:
The company deals in garments business consisting of readymade and customized
products. U n’ ME garments is a small venture and on its initial stages. It does not have
enough time and finance for primary market research. The products including Dress shirts
and formal trousers are source of satisfying needs of target customers.
Niche market of U n’ Me is students of UMT hostel and a small segment of a big industry
is focus of operation i.e. UMT hostel which comprises of 500 – 600 students. Using of
print media is affective for U n’ Me Garments for creating awareness to its customers,
because the print media is the most appropriate strategy for it to reach to its target
customers. Also the limited marketing budget does not allow it to go on large scale
marketing. The business deal only on cash basis. Penetration is used for pricing. This
price is deliberately set at low level to gain customer's interest and establishing a foot-
hold in the market.
The location of U n’ Me is very convenient for its target customers to come and have
shopping there. It is located in the heart of its target market. As parking facilities are there
in the hostel which will fulfill the requirements of customer. The unique corner of the U
n’ Me Garments is that it is accessible for its target market as it will be operating in the
UMT hostel which is the main point of focus. It can easily interact with its customers
leading to various improvements in its operations, and also better understand the
changing preferences of its target customers.
In case, if any shareholder want to withdraw from the business, the other members try to
cover the gap by utilizing their efforts & if the situation arises when U n Me will need a
specialist person then they will go for new hiring.
There are different department in U n ME .All the members of each department don’t
have any practical experience regarding their respective field they know the strategies
and policies of operating & launching a business & how to make it successful by utilizing
their skills and knowledge.

39