A Report on Entrepreneurship

Business plan

Submitted to Dr. S. R. Subba Rao Submitted by Y.Yeshwanth Reddy R.no 10351 Section- c

Contents
Executive summary: ............................................................................................ 3 Features of the product: ......................................................................................... 4 Target customers:............................................................................................. 4 Value Proposition to the customer: .......................................................................... 4 Revenue Model: .............................................................................................. 4 Management Team: ............................................................................................. 5 Founder of Business: ......................................................................................... 5 Management responsibilities: ................................................................................ 5 Reinforcing Management team: ............................................................................. 6 Market and Competition: ....................................................................................... 6 Expected Market Growth:.................................................................................... 6 Competitors: .................................................................................................. 6 Strengths and Weaknesses of competitors: ................................................................. 6 Marketing and Sales: ............................................................................................ 7 Distribution: .................................................................................................. 7 Pricing strategy: .............................................................................................. 7 Business Systems and Organizations: .......................................................................... 8 Proposed organizational structure: .......................................................................... 8 Hiring plan: ................................................................................................... 8 Scope of the Business: ....................................................................................... 9 Strategic Partnership:......................................................................................... 9 Implementation and schedule: .................................................................................. 9 Short term implementation plan: ............................................................................ 9 Long term implementation plan:........................................................................... 10 Opportunities and risks: .................................................................................... 10 FINANCIALS: ................................................................................................ 11 Profit and loss account: ....................................................................................... 12 Revenue generation: .......................................................................................... 13 Cash flow statement: .......................................................................................... 14 Balance sheet: ................................................................................................. 15

Executive summary:
Population in India is becoming busy day by day as both the men and women are working. So time is the main constraint for them and Most of the Indians are willing to take jobs in abroad but they cannot take their parents along with them due to their reasons. Our venture works for such families and individuals who cannot get their work done due to age and etc., reasons, and people who are able to do their but cannot due to their time constraint. We serve them by performing their works by charging reasonable money for the service rendered. Initially the venture is set to start its operations from Hyderabad and gradually it expands to other major cities. Objectives: Main objective of the venture is to serve people by getting their work done and for that reasonable amount is charged to continue with the operations of the business. Mission: To become number one company in service sector by providing best services to the customers in all possible ways to fulfill their needs, thus, by gaining good customer satisfaction from customers. To start the venture the capital expected is twenty three lakhs and this amount is contributed equally by five partners of the venture. In the first year of operations profits are not expected as its a new venture and awareness should be created about the service and hence expenses are more in the first year but from second year it is expected to generate profits.

Features of the product:

The service we provide to the customers is customized. The main feature of my service is: Customer himself defines what is required to him and we serve them accordingly by charging some amount from them for the service. Example: Customer has few works that he has to in a day but because of his busy schedule or some other reasons he is not able finish his works. So if he contacts us and says what all the works he needs to be finished in that day, we will get those works done for him and for that he is charged depending the work.

Target customers:
Main target customers for my service are Senior citizens and families where both Husband and Wife are working. The reason for selecting this section of group as target customers is: one section of customers cannot perform all the works because of their age and another section of customers dont have time as they are working.

Value Proposition to the customer:

Value proposition the customers are getting with my service is: They dont need to think much for how to do that work or when to do that work in their busy schedule. And they are getting that work done at all most the similar cost they incur.

Revenue Model:
The main revenue for my business is from providing service to the customers so it falls under Sales revenue model. Another source of revenue is from by taking customers to other business.

Example: If one customer asks to get grocery I will send my employee to the shop where I have tie-up, for that I will collect some amount from that shop keeper this is secondary source of revenue to my business. This Business Model didnt exist elsewhere as far as my knowledge concerned. But some models similar to this model are providing full service relating to marriage works, Tours etc.,

To maintain loyalty of customers:

Any customer will be loyal to a brand or service only if it satisfies him so I will plan my work in such a way that the service provided by me give hundred percent satisfaction to the customer. I will make sure that satisfaction to the customer by getting that work done for him on time with minimum cost.

Management Team:
Founder of Business:
Y.Yeshwanth Reddy( Myself) is the founder of the business and my qualifications are I am an B.com(C.A) graduate and PGDM holder. I dont have any prior experience in business field.

Management Team:
Along with me I have four people as my business partners and we five are the management team for the business.

Management responsibilities:

Myself and one of my partner C. Gopinath Reddy being management students takes care of Marketing activities of the business like advertising about the service getting customers, making tie-ups with other businesses which helps me in getting done customers work. G. venu madhav
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reddy who worked as a manager of a business and Shiva reddy being M.tech student takes care of operations of the business like what and when employees has to do and how to do. Chandra shekar reddy being Financial advisor he takes care of Financial activities of the business.

Reinforcing Management team:

I will start my business operations first in some regions of Hyderabad city for which me and my partners are sufficient for taking care of operations but once I start expanding my business in other cities then I need more personnel to take care of operations at different places. A person with good scheduling and managing labor skills are required for being in to my management team.

Market and Competition:

According to census of India there are about eight to ten percent of senior citizens in India and about twenty five to thirty percent of working couple in India. All these are my target customers.

Expected Market Growth:

Expected market growth include families even where only husband or wife working. The main factor for this group of customers being part of my business is Time factor. A house maker too has lot many works to take care so she may not get time to go out and get some work done.

Competitors:
Likely competitors for my service can be the businesses that are providing online services or mobile services to the customers. Example: Retail shops, Hotels etc., providing home delivery facility to their customers. These are competitors only for some of my services like in above example but for some services like paying current bills, telephone bills etc.,

Strengths and Weaknesses of competitors:

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 The main strengths of the competitors are customer can select and order himself through Internet and he pays for that after he gets that product. Here customer enjoys using technology for fulfilling his needs. And he can perform that operation round the clock. Weaknesses: Most of the Indians are not habituated in using technology for their shopping, payment or for some other purposes. Main disadvantage of their service is customer cannot touch and feel the product. Payment through online is another disadvantage of internet shopping.

Marketing and Sales:

Service is promoted through news papers and magazines as senior citizens prefer to read them. Bill boards are placed near areas where companies are located, to attract the attention of working couple and at major places where many apartments are located. As television advertisements are costly that will be done after business establishes in major cities of the country.

Distribution:
No distribution channel is needed for this business as main product is service and it requires only the involvement of my company employees and customers.

Pricing strategy:
As the service is customized there is no fixed price. Price is charged depending on the time my worker is spending for customers work and distance he is travelling. Example: If one customer asks to book a ticket to some place and deliver that ticket to his home then for this I dont need to charge much because I can book ticket online and send him.

But if he asks me to book a tatkal ticket near railway station but not through internet then I will charge him amount more than what I am charging for normal online ticket because my employee has to travel and spend some time for booking ticket.

Business Systems and Organizations:

Proposed organizational structure:
The organizational structure of the company includes four departments Operations, Marketing, Finance and Human Resource departments. For every region there will be a manger under him there will three levels. At first level employees take the service needed to the customer and all other information and passes to other department where they finish that work if it can be done through online or phone if not they allot one employee for that work. Example: Regional manager for Hyderabad and there will be a higher boss for all regional managers. Under every regional there will three levels for operations. A structured organization resembles a structured work which reduces the errors at work. If once customers are satisfied and they become loyal it increases the brand position of the company in market which helps in attaining the goals of the company in any aspect like becoming leader in the sector or to increase the turnover etc.,

Hiring plan:
For hiring employees who go on field and do the work, employees who receives phone call and records their need dont require much skills as it is not a big task. Lets assume that a region requires 50 employees for scheduling the work to the field employees. Skills required Manager He needs to keep check on how well operations are being performed and at the same time he also has to take care of agreements between hotels, retail shops

etc., For this he requires good communication skills as he needs to speak with other business people for making agreements and at the same time he should be able to control the departments under him and motivates them to perform work efficiently. Operations department This is very important department as they need to schedule the work to field employees, they should require skills in allotting work to right persons. Operations Management students are better suited for this department.

Scope of the Business:

In this business there is no outsourcing of any work.

Strategic Partnership:
The secondary source of revenue to my business is through partnerships between different businesses like Courier services, Booking tickets, Grocery, hotels etc., The partnership with them is secured because they are getting business without keeping any efforts.

Implementation and schedule:

Short term implementation plan:
Two months before starting the business the marketing activities will start to create awareness about the business and kind of service we are providing. In that period a place for setting office is selected and employees are hired. As we are starting the business and we need to be careful in spending money so we partners will take care of all activities that need to be done for starting the business. In the beginning days of the business the operations will be less so there will be no separate managers, we partners will take care of those activities along with some operational work which helps us to know the pros and cons of the business. This helps us training managers effectively in future.
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The major mile stone is breaking even in first year of starting business. There are interdependencies between each task like customers call only when they know about the company that will be done through marketing activity, after they take information from customer operations department has to take that information and schedule the work to field employees and if they have to buy and deliver they will go to the shops where we have agreements. Like this each task is interdependent.

Long term implementation plan:

The long term implementation strategy is to start operations in all major cities in India. As operational activities have been increased the areas will be divided into regions and for every region there will be a regional manager and under him there will be three departments for receiving information, for scheduling and for performing work. Major mile stones are to start operations in all major cities in India and to perform well in terms of turnover in all the places.

Opportunities and risks:

There is a chance of expanding my business fast as there is no other competitor in my field. I have an opportunity of targeting even institutions. Example: consider a educational institution where they are planning to conduct one seminar or planning some function in the institution. For this more workers are needed as work has been increased but they cannot hire employees for few days in those situations they can make use of my services. Risks: There are many chances that I will face competition from a competitor who enters in to similar business.

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FINANCIALS:
Cost of Project: S.no 1) Particulars Fixed assets Computers (5*25000) Mobile phones (50*1000) Motor bikes (10*45000) Cars (2*3.5L) Furniture and fixtures (1,00,000) 1,25000 50,000 4,50,000 7,00,000 1,00,000 1,75,000 60,000 6,75,000 7,00,000 1,00,000 2,50,000 75,000 9,00,000 10,50,000 1,00,000 Year1 Year 2 Year 3

Total 14,25,000

17,10,000

23,75,000

2) 3) 4) 5)

Miscellaneous fixed assets Preliminary expenses Margin for Working capital Provision for contingencies

1,00,000 1,00,000 1,50,000 3,00,000 Total 20,75,000

1,00,000 1,75,000 3,00,000 22,85,000

1,50,000 2,00,000 3,00,000 30,25,000

Means Of Financing:
All the five partners will contribute the required amount equally.

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Profit and loss account:

S.no 1)

Particulars Gross sales

Year1 60,00,000

Year2 93,60,000

Year3 1,35,00,000

2)

Cost of operations (Fuel and Mobile exp) Power expenses Salaries Advertisement expenses Rent Depreciation Other misc.expenses

12,00,000

14,64,000

21,60,000

3,00,000 39,00,000 8,00,000 6,00,000 1,62,500 2,00,000 Total cost (71,62,500)

3,10,000 49,80,000 3,00,000 6,50,000 2,01,000 2,00,000 (81,05,000) 12,55,000 8,00,000 20,55,000 (2,00,000) 18,55,000 18,55,000

3,30,000 65,10,000 3,00,000 8,00,000 2,40,000 2,00,000 (1,05,40,000) 29,60,000 10,00,000 39,60,000 (3,00,000) 36,60,000 36,60,000

Operating profit 3) 4) 5) 6) 7) Other non-operating income Profit before tax Provision for tax Net profit Cash generation

(11,62,500) 6,00,000 (5,62,500) (1,00,000) (6,62,500) (6,62,500)

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Revenue generation:
It is assumed that on an average each employee will get ten thousand rupees on an average per month in the first year, in the second year it is assumed that all employees will get average sales of thirteen thousand per month and in the third year that amount will be increased to fifteen thousand. Other than sales another source of income is from the organizations to which we are getting customers. That amount is assumed to be six lakhs, eight lakhs and ten lakhs for three years.

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Cash flow statement:

S.no

Particulars

Year1

Year 2

Year 3

1. Cash From Operating Activities Netincome (6,62,500) 19,06,500 37,37,500

(+) Depreciation

1,62,500

2,01,000 20,69,000

2,40,000 39,00,000

Net cash from operations (5,00,000)

2. Cash From Investing Activities Purchase of Computers Purchase of Mobile phones Purchase of Motor bikes Purchase of Cars Purchase of furniture Other fixed assets 1,25,000 50,000 4,50,000 7,00,000 1,00,000 1,00,000 50,000 10,000 2,25,000 75,000 15,000 2,25,000 3,50,000

Net cash from Investments

(15,25,000)

(2,85,000)

(6,65,000)

3. Cash From Financing Activities

4)

Net Increase in Cash + Opening cash

(20,25,000)

17,84,000 (20,25,000)

32,35,000 (2,41,000) 29,94,000

Total (20,25,000)

(2,41,000)

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Balance sheet:
Particulars Current assets Fixed assets Computers 5*1,25,000 Mobile phones 50*1000 Motor bikes 10*45000 Cars 2*3,50,000 1,25,000 50,000 4,50,000 7,00,000 1,75,000 60,000 6,75,000 7,00,000 1,00,0000 2,50,000 75,000 9,00,000 10,50,000 1,00,000 Year 1 Year 2 Year 3

Furniture and Fixtures 1,00,000 1,00,000 (-) depreciation

(1,62,500) (2,01,000) (2,40,000) Total 12,62,500 15,09,000 20,45,000

Other miscellaneous assets Preliminary expenses Working capital Total assets Liabilities Capital Reserves and surplus

1,00,000 1,00,000 1,50,000 15,22,500

1,00,000 80,000 1,75,000 18,64,000

1,00,000 60,000 2,00,000 24,05,000

22,00,000 -

22,00,000 2,00,000

22,00,000 2,00,000

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