A BUSINESS PROPOSAL ON MRET LABONNO Introduction Mret Labonno is going to establish with new dimension, lucrative & fashionable style of terracotta products crafted with soil in 2010 entering in the pottery & terracotta industry in Dhaka City .The Company has also exclusive visions to perform in whole Bangladesh as well global to export the products to overseas market as a vision in 2012.
Mission Statement The mission statement of the Mret Labonno is “to be the attractive crafting terracotta product manufacturer in Bangladesh providing the best quality services to our customers, value to our shareholders, and a dynamic working environment for our society”.
Goals and objectives The company’s goal & objective to make position Bangladeshi terracotta industries as a designer ware and as a vital part in interior designing and hence uplift the vanishing art of exclusive Bangladeshi clay artifacts to maximize the profit & give better services to the customers.
Industry It is a growing industry in Bangladesh. Today’s commercial companies & cultural classes’ people are more concern about the creativeness & decorations of their corporate, factory layouts. So we are got & enormous opportunity to build up this industry.
ďƒź Strength We believe that our most substantial Strength is our innovatively designed product. Maximum firms in this industry do not have creativity & innovative products in the market. So the market situation is very much favorable for our business. This is the prior strength of us. Again the total marketing and operational team we have are very much efficient. They have observed that customers have much eagerness about the terracotta product .So we are quite sure that those customers will be very interested to our product.
ďƒź Proprietary Right All the products and services created by us will be strictly protected by the current proprietary rights of the Bangladeshi government and will be registered under Mret Labonno as a partnership business.
PRODUCT AND SERVICES OVERVIEW
Description of the products ďƒź About the products The concept of the product has come from traditional terracotta & pottery industry. But our products is different from others .So adopting the idea we found that if we work with this it will be very much attracting for our customers and thus we can get our business profit. We are offering five categories of products. Those
are
Terracotta
Plants,
Terracotta
Decorative,
Terracotta
Ornaments,
Terracotta
Wall
Hanging,
Terracotta
Vases
.The
characteristics and features are shown in the table below:
Packages
Price
Categories Terracotta
Low
Feature Attractive , Durable , Easy to
Plants Terracotta
Moderat
move, Cheaper Colorful, Highly Blazed, Heavy ,
Decorative Terracotta
e Moderat
Cheaper Flexible, Cheaper, colorful.
Ornaments Terracotta
e High
Rare Items, Written Literature ,
Wall
Solid ,Highly Glazed, Highly
Hanging Terracotta
Blazed Rare Items, Heavy , Durable ,
High
Vases
Attractive
Benefits Customer will get lucrative design & rare products. Every package has its special and attractive set of features. Customer can use physically at their personal & professional works. It will increase the interior beautification of the home, office & factory.
Proprietary Right All the products and services created by us will be strictly protected by the current proprietary rights of the Bangladeshi Government and will be registered under legitimate of Mret Labonno as partnership business.
INDUSTRY AND MARKET PLACE ANALYSIS Opportunity analysis
STRENGHT •
Product variation
•
Distinct from competitor
•
Customers strongly like it
•
High Promotional activities
OPPORTUNITIES •
Customers strongly like our product
•
Less numbers of competitors
•
Much demand for innovative products
The market for terracotta with innovative design like what we are offering has a good potential. So if we have strong product variation that no competitors have. We can design the products which are preferable for customers who like to buy. We are tending to expense on high promotional activities. Beside of fewer competitors we can create demand to the customers & that’s the opportunities around the market of terracotta industry.
Overcome weakness and threats; WEAKNESSES: •
Low financing
•
Low investment
•
New company in the market
•
Low profit because product is in the introductory phase so the promotional
activities are very high therefore the cost is more than the profit. THREATS: •
Unsaturated market
•
Potential for new customers
•
Cost of core raw material (Soil) is increasing day by day which ultimately makes
the cost high
Though we are going to initiate with innovative features and designs in the market and we are probably the first to do so. But there has existing in the market. We have to compete with them. And there has a threat that they can copy our designs and ideas. So we have thought to protect these threats and challenge we will be doing patent protection certificate to defense our products and designs.
Industry Structure and analysis
Mret Labonno falls under the terracotta industry. It is an immature industry. There has a low competition among the rivals but the products are producing by the different competitors are very much homogenous. But we think that our product is some way different from that of other competitors. That way we feel we can beat our competitors.
ďƒź Market size and Growth Initially we are thinking to extend our market in the Dhaka city. Analyzing and studying the market we have observed that the regular sales of Terracotta product from different producers are around 1,000 per month. Among the sales per month most of the products are bought by the upper class and upper cultural society, corporate house also use to buy for layout of the corporate office. So analyzing all the factors we have come to a decision that the market size in the Dhaka city will be around 1, 40,000. Market Upper Class Upper Cultural Class Corporate House Interior Designer Total
Target Market 50,000 30,000 30,000 30,000 1,40,000
ďƒź Competitive Environment
Estimated market 45,000 25,000 25,000 25,000 1,20,000
The market of terracotta is very much competitive in Bangladseh. There are lots of companies which are producing terracotta in Bangladesh. So in the initial stage we may have to face a competitive market. To gain a competitive plus point we think that we have to provide good quality with reasonable price. We think that our products are good in quality and also prices are reasonable.
Target Market The target market of “Mret Labonno” consists of Upper class and upper cultural class, corporate houses and also link with event management to provide artifacts for rent. The Bangladeshis are in the lookout for better and bigger houses and they want their houses to be decorated perfectly. “Mret Labonno " provides the perfect solution in the form of ethnic terracotta products, modern products and other artifacts of clay along with the expert advice of an interior decorator.
Competitive Analysis There are fewer existing brand in the market. They follow the traditional production method & elements to produce the terracotta & pottery products. Comparing to them, our production & marketing strategy will be different with them.
Sales Analysis In the first year we hope the total sales will be 5,000. The forecasted sales are showing in the following table. Customer
Upper Class
Sales
800
Sales By Packages Plants
Decorative items
Vases
Sales By package Ornaments
500
150
50
50
Sales By packages Wall Hangings 50
Upper Cultural Society
1200
200
300
300
300
100
Corporate House
1500
400
500
400
100
100
Interior Designer
1500
300
600
250
50
300
Target market strategy The target market of “Mret Labonno” consists of Upper class and upper cultural class, corporate houses and also link with event management to provide artifacts for rent. The Bangladeshis are in the lookout for better and bigger houses and they want their houses to be decorated perfectly. “Mret Labonno " provides the perfect solution in the form of ethnic terracotta products, modern products and other artifacts of clay along with the expert advice of an interior decorator.
Product/Service Strategy There will be outlets in different places of Dhaka city to serve the customers. Mret Labonno will initially introduce the products that fulfill the basic need of the customer. When we will introduce more products into the product lines then some extra value added service will also be given to the customers. Then some additional products which are known as captive product will introduce into the market. The after sales service will also associated with the products. Customers will get free 1 year after sales service.
Pricing Strategy So adopting the idea we found that if we work with this it will be very much attracting for our customers and thus we can get our business profit. Packages Categories
Price
Feature
Terracotta Plants
Low
Attractive , Durable , Easy to move, Cheaper
Terracotta
Moderate
Colorful, Highly Blazed, Heavy , Cheaper
Decorative Terracotta
Moderate
Flexible, Cheaper, colorful.
High
Rare Items, Written Literature , Solid ,Highly
Ornaments Terracotta Wall Hanging Terracotta Vases
Glazed, Highly Blazed High
Rare Items, Heavy , Durable , Attractive
Communication Strategy We have planned to apply our promotional strategies in different time. Because this is new product customers are not alert of this product. We will also use outdoor advertising. So, to create awareness among the people it requires taking large scale of promotional activity. For his industry newspaper ads, word of mouth, and web sites are most appropriate. We have decided to take such type of promotional effort. Now a day in our country magazines and television is a very popular media of marketing. We will go also for this type of promotional strategy. The first month we will give more emphasis on informing the people. Second stage we will let the customers for trial use. Then we will take convincing activities. We will use Media advertising, outdoor advertising in promotional strategy which is describing elaborately in the following. •
Brand name: “Mret Labonno”
•
Logo :
•
Slogan : Mret Labonne Shadhon Lalito
Promotional activity For the promotional activity We have chosen some specific tools to use. We will use those tools in different time.
Advertising We will give more emphasis on newspaper. We will use different media for advertisement. Television, Magazines, Newspaper, and Billboard will be used simultaneously. We will use two sided message in our advertisement. We will use anticlimax order in presenting our message to the target audience. We think that the people who are more educated will buy the product.
Public Relation Public relations are any purposeful communications between an organization and its publics aim to generate goodwill. This is a non paid promotional tool in marketing process. For the new type of product, publicity is ultimately needed. When any organization or any company come up with new product, idea or service, this news automatically come in newspaper. This is called publicity.
Sales promotion Short term incentives taken to increase the sales are called sales promotion. We will contract with different dealer and announce some discount of cash for them only. We will also have collaboration with hospitals. Gantt chart: July
August
September
October
Newspaper
30
30
25
25
Magazine
10
10
15
10
TV
25
25
25
25
Internet
10
10
10
5
Channel Strategy WE will contract with different outlets of different market to sell the product. There will also company’s own stall in some selected market. The company will outsource the logistic support to deliver the products to the final customer.
Marketing Channel for delivering the product
Head Office
Old Dhaka
Jatrabari
Dhanmondi
Farmgate
Mirpur
Customer
Customer
Customer
Customer
Customer
Uttara
Customer
Savar
Customer
ďƒź Sales Strategy Our strategy for sales will be personal selling. TV infomercials will be delivered continuously to enhance the sales. Customers will come to different stalls and buy the desired product. After sales service will be given the customer to enhance the sales. Each of the customers will be supported by a service card by showing which
they will get the free service after sales when they faces problem. A sales team will also be formed to control the sales activity of the company.
OPERATION PLAN
ďƒź
Corporate Strategy
The major features of "Mret Labonno" are: - The showroom will provide an exclusive variety of both modern and ethnic artifacts in soil & clay. - The showroom ambiance will be concentrated upon and the showroom will resemble a traditional Bangladeshi rural hut from the interior which is decorated with the artifacts. - The customers can also place special orders and the in-house artisans will be consulted for that. - The customers are assured with after-sales service which will be provided at their residence or office every six months. - The in-house interior decorator would see the customer's residence or office and suggest appropriate artifacts. - There will also be pottery class for people who would like to pursue it as a hobby and also it is open for children on weekends. - There will be direct link with rural potters for procuring special clay artifacts. - There will also be link with event management organization to rent the pots for the events they organize.
ďƒź Location & Layout Area (acr)
Employees
Supplier
100
Location
Raw Materials
Factory 1. Savar
3
Etel Soil
2. 2. Gazipur Total
6
150
Sri Birandro Pottery House
9 acr
250
2 Suppliers
Dowash Soil 2 kinds of raw material
Production Process Activity/ Production Process
Machinery / Technologies
Time Frame
X X X √ X √ √ √
5 day 2 days 1 days 3 days 1 days 7 days 2 days 2 days
Collecting Clay / Soil Filling Soils Dry Soil Make a frame of product Drying Process Firing. Glaze Color
Photos of Production Process
Organizational Hierarchy :
DIRECTOR Md. Farukuzzaman
MARKETING EXECUTIVE C.E.O
FINANCE EXECUTI VE
Ishtiaq Ahmed Fahim
Md. Sohel Rana
Kishoara Sharmin Jui
Production Manager Operation Manager Md. Monwarul Ahsan Jahanara Akhter Akhy
Key role • – – – • – – – • – – – –
INTERPERSONAL ROLES FIGUREHEAD LEADER LIAISON INFORMATIONAL ROLES MONITOR DISSEMINATOR SPOKESPERSON DECISIONAL ROLES INNOVATOR / ENTREPRENEUR (PLANNER) DISTURBANCE HANDLER (CRISIS MANAGER) RESOURCE ALLOCATOR (SLICING-THE-PIE) NEGOTIATOR (BARGAINER)
Financial plan
Capitalization Plan Capital required Primarily to establish the production the firm required 21,55,000 taka where the start up cost is 9, 75,000 taka and operating cost is 11,80,000 taka. Start-up cost The start up cost of the business is that needed initially to start the business. To start the business there are some fixed asset is required. These are: Description Equipment and machinery
Amount 80,000
Land and building
3, 00,000
Furniture and fixtures
50,000
Other fixed cost
50,000
Working Capital
30,000
Computer
60,000
Office room decoration
25,000
Other costs and services Factory Van
30,000 3, 50,000
Total Fixed cost / Start up cost
9.75,000
Operating cost To operate the businesses there are some operating cost. Total operating cost for the company is 11, 80,000. Description Raw Materials Office rent (Annual) Wages and Salary Marketing expenses Utilities Operating inventory Other factory overheads Total Operating cost
Capital sources
Amount 1,00,000 3,00,000 2,00,000 3,00,000 1,00,000 80,000 1,00,000 11,80,000
To form the business financial stability is very much needed. The capital may collect from various sources. These are – Cash capital The cash capital of the business will be 60 % of total capital that. Rest of the amount will be collect from financial institutes. Credit capital The company will manage 30% credit capital from raw materials suppliers. Debit capital The company will collect 10 % of the total amount from the financial institution as debt capital at the rate of 10%. Financial Projection Financial projections of first four months of Mret Labonno Products are in below and based on this WE made its one year financial projection.
Income Statement Description
4 months
One Year
Sales (100%)
2, 50,000
7, 50,000
75,000
2,25,000
(-) COGS (30%) Gross Profit (70%)
1, 75,000
5, 25,000
(-) Fixed Factory OH (15%)
26,250
78,750
(-) Selling and Adm exps (20%)
35,000
1, 05,000
8,750
26,250
1, 05,000
3, 15,000
(-) Other Exps (5%) Net Profit (40%)
Funding:
In order to open ‘Mret Labonno”, our management has determined that capitalization of 1600000 will be required. These funds will be allocated as follows: Description
Amount
Equipment & Fixtures Installation and make ready Advertising & Promotion
4,00,000 2,00,000 3,00,000
Deposits and initial start-up costs
1,00,000
Contingency
50,000
Operating Reserve
1,30,000
Total
11,80,000
Equipment & Fixtures are listed in the schedule on the following page. Our Business Plan anticipates that capitalization will be funded as follows:
Description
Amount
Proprietors' Equity
12,93,000
Borrowed Capital
8,62,000
Total
21,55,000
CONCLUSION Performance of a new firm in industry is always hopeful in the traditional history of terracotta industry in Bangladesh. Mret Labonno is one of the firms in the new beginning of 2010. Not to maximize our profit in the short term, we will focus on customer need & satisfaction in this period. We hope we will provide our product will serve better in future in Dhaka city & also outside the capital. We have a dynamic plan to enter in the overseas market after 3 years.
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