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ACKNOWLEDEGEMENT

I offer most humble thanks to Almighty ALLAH who is the entire source of

all Knowledge & wisdom to mankind, for bestowing upon me the sense of

inquiry and potentials for successful accomplishment of this piece of work..

It is my privilege to express my sincere gratitude to my respected hearted

and kind hearted worthy teacher “MR. SHAMIM AHMED” for his

valuable support and encouragement that he has offered.

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TABLE OF CONTENT

S.NO DESCRIPTION PAGE NO

1 ACKNOWLEDGEMENT 1
2 TABLE OF CONTENT 2
3 EXECUTIVE SUMMARY 4
4 SITUATION ANALYSIS 4
Category/Competitor
Definition 4
Category Analysis 4
Company and Competitor
Analysis 4
Customer Analysis 5
Planning Assumptions 5
Proposed Structure of the
Organization 6
Market potential of the bags 6
5 OBJECTIVES 7
Financial Objectives 7
Marketing Objectives 7
Social Objectives 7
Customer-Oreinted
Objectives 7
6 MARKETING STRATEGIES 8
7 PRODUCT/BRAND
STRATEGY 8
Customers Target(s) 8
Competitors Target(s) 9

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Product/Services Features
Core Strategy 9
8 SUPPORTING MARKETING
PROGRAM 9
Advertising 9
Promotions 9
Sales 10
Price 10
Channels 10
Customers Management
Activities 10
Website 10
Marketing Research 10
Partnership/Joint Ventures 11
Distribution 11
9 FINANCIAL DOCUMENTS 11
Proforma Statements 11
Income Statement 13
Proforma Income Statement 14
Cash Forecast on monthly
Basis 15
Cash flows 16
Balance Sheet 17
10 MONITOR AND CONTROL 18
Secondry Data 18
Primary Data 18
11 CONTINGENCY PLAN 18

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MARKETING PLAN OF ALI SCHOOL BAGS
MANUFACTURING COMPANY

EXECUTIVE SUMMARY:

The name of the company is “ALI BAGS MANUFACURING COMPANY” and it


will be sole proprietorship business. It deals with the manufacturing of bags and their
packaging. The management level employees will be hired on permanet basis and there
will be a contractual employees hired on fixed contract term basis.
The total amount of finance needed for the business is 20 million out of which 10 million
will be injected from the side of owner and the rest will be obtained from banks and the
term and conditions of payment will be decided accordingly.

SITUATION ANALYSIS:

The situation analysis contains data and concomitant so vital to developing sound
marketing strategies. Situation Analysis is the homework part of marketing plan. It is
comprised of six parts which are as follow.

1) Category/ Competitor definition:

The bags will be placed in the school stuff category.My competitors will be mainly the
companies which make the school staff. My main competitor is adnan and co.

2) Category analysis:

The total GDP of our country is 109 billion and the contribution of the school staff
companies is 10 million and seeing the current market situation demand for the school
stuff is very high.

3) Company and Competitor analysis:

The construction of the company would start from January 2007 and will be completed
in May 2007.The machinery will be imported from china .The company will start
production in June2007. The company will launch its products in August 2007.

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The price of bags will be around Rs 500.

4) Customer analysis:

As children are mostly influenced by the quality of bags and there design.
So “ALI BAGS MANUFACURING COMPANY” will use high level of
technology not only to influence school children but also the students of colleges
and universities. Mostly students like small bags so the company will introduce
family size bags which includes small, large and large size bags. Children are also
influenced by the color of the bags, So the company will also keep a focus on it.

5) PLANNING ASSUMPTIONS:

Following are some of the assumptions regarding the planning.

The company will try to capture the 20% market share.

• The company will open its outlets at different places i.e. Gulshan-e-Iqbal,
Gulistan-e-Jauhar, North Karachi.

• The company will try to ensure the best utilization of raw material,
machinery and other equipments.

• The company will use the television channels and bill boards for the
advertisement of its products.

• The company’s target will be schools, colleges and universities students.

• The company will not do more production in the months of September-November


and there will be more production in the months of December-January in order
to meet customers demand. For the supply of raw material the creditibility of
suppliers will assessed and the list of approved suppliers will be maintained.

• On the basis of its progress the company will introduce the online
purchasing system.

• The agreeement will be done with suppliers for fixed term.

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Proposed Structure of the Organization:

This firm owned by Sarwar Ali would be a sole proprietor business. It would be managed
and run by the owner only. The owner Sarwar Ali, would have full authority over the
business. Every issue that needs to be signed would require his permission and
signature. . The hierarchy is flat and it helps to authorize more control on the firm and the
sub-ordinates. The firm includes a CEO, managing director, workers etc.

CEO

MANAGING
DIRECTOR

Manufacturing Packaging Manager


Manager

Workers Workers

MARKET POTENTIAL OF SCHOOL BAGS:

Total population = 37258178


Two percent of the population uses the bags
People who use the bags = 37258178*1%= 372581.78
Quantity = Number of consumers* Frequency of consumption* quantity
= 1 * 1 * 1
= 1

Market potential = price * quantity * number of consumers

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= 500 * 1 * 372581.78
= 186290890 Rs

OBJECTIVES:

1) Financial Objectives:

The financial objective of the company as like any other company is to increase its
profitability, which hence needs high revenues and lower cost of production

2) Marketing Objectives:

We will try to be a market oreinted organization with the main focus on the fulfillment
of customers needs.
Our product (bags) have the objective to achieve maximum market share as possible.
To achieve this growth in market share our products are innovative to grow the
market and provide consumers with new products that would develop interest and
maintain brand loyalty.

3) Social Objectives:

The company will contribute toward social obligations such as giving contributions
in charities, development of school
colleges and hospitals.

4) Customer-Oriented Objectives:

The company will also try satisfy the customer needs with the quality products and for
that company will opened a customer service center to deal with the complaints of
the customers in order to know what really customer wants and how can the company
satisfies their needs in the best possible way.

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MARKETING STRATEGIES:

Different modes of marketing will be tried to make our marketing strategies more
effective.

Following are some of the marketing strategies which the company will use.

• Advertisements are used to promote the product, to increase awareness among the
population. To remind consumers of the product. All these purposes of
advertisements will have a direct affect on sales.

• Promotions strategies such as price offs and instant gifts are some examples
which will encourage people to buy our bags and gain much more than the
satisfaction of using those bags but instead gain a lot more and worth much more
than the bags of the competitors.

• The company will launch a structured long-term plan to optimize its presence in
the wholesale market through initiating a loyalty program for wholesalers across
the country.

• There are different kinds of consumers. In the rural areas the masses living in
poverty do not use bags frequently. To them using a bag is very expensive
instead they prefer to their books and other things in hands. So the company will
try to break this trend by sending sales representatives to different areas or
through radio which will boost sales, and hence profit and market share.

PRODUCT/ BRAND STRATEGY:

1) Customer target(s):

The target customers of our products/ brand are children below ten years up to the
people of schools, colleges and universities.

2) Competitor target(s):

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The company will target the competitor by launching best strategy as compared to
them and will try to snatch market share from them as much as possible. The
company will try different channels to advertise its product which the competitors
might not have used.

3) Product/ Service Features:

Following are some of the features of the product.

• Three to four pockets.


• Double folded.
• Black colour.
• Zips of good quality.
• Comic characters such as of Miky Mouse, Tom and Jerry etc.

4) Core Strategy:

In order attract customers the differential advantage will be the quality of the bags.

SUPPORTING MARKETING PROGRAM:

1) Advertising:

The company will advertise its products twice to thrice a day on various television
channels and on two to three
news papers.

2) Promotion:

Promotion means how you promote your products. Following are some of the ways
company will use to promote its products.

• Advertisement on television
• Giving free samples to consumers.
• Door to door selling.

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3) Sales:

To increase the sales of the product company will use the following techniques.

• Discounts offer
• Buy on get one free
• Balloting
• With every large size bag, a small will be free

4) Price:

The prices of the bags will be Rs 500 for all kinds of customers.

5) Channels:

The company will use the following channels to advertise its products.

• Television channels.
• Newspapers.
• Bill boards.

6) Customer Management Activities:

To manage the customers company will maintained a call center in order to remain
in touch with its customers and the company will try to handle the customer related
matters in efficient manner.

7) Website:

The company will also maintained a website www.alibagsmanu.com to remain in


touch with its customers. The website will be updated with the product brochures,
online submission of customers complaints and the complete address of the company

8) Marketing Research:

The will company will conduct a research on yearly basis and before launching a
product, it will get reviews from customers to kwon exactly what they want and how
can they be benefited from our products.

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9) Partnership/Joint Ventures:

Based on the performance the company will make partnerships with other
companies in opening small projects.

10) Distribution:

The company will use the extensive distribution ( available at its all outlets) to
distribute its products.

FINANCIAL DOCUMENTS:

Pro forma statements:

Financial planning is a key factor for developing a new venture; first we will start with
the sales forecasting of initial twelve months for the year 2008. The figures are in
thousand (000’s).

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Projected
50 55 62 69 75 85 100 105 112 120 125 135
sales (units)
Desired
10 10 7 3 4 3 8 5 6 10 7 5
ending Inv.
Available
60 65 69 72 79 88 108 110 118 130 132 140
for sale
Less:
Beginning 2 5 8 9 10 12 13 15 18 26 35 38
Inventory
Total
Purchase 58 60 61 63 69 76 95 95 110 104 97 102
Required

Total Production/Purchased is calculated by the following formula:

Total Production = Projected Sale+ Ending Inventory- Beginning Inventory

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Following is the sales budget schedule for 3 years as per demand by the customers.

2009 2010 2011


Projected sales (units) 1095 1098 1102
Desired ending Inv. 80 82 85
Available for sale 1175 1180 1187
Less:Beginning
192 194 196
Inventory
Total Purchase required 983 986 991

Now on the bases of the sale forecast we can predict other financial statements.
Following is the monthly income statements of the company.

INCOME STATEMENT 2008 (000’s)

Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec

Sales 65 75 85 95 110 118 127 135 143 150 160 175

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Less: CGS 25 27 28 28 29 29 30 31 32 33 33 34
G. Profit 40 48 57 67 81 89 97 104 111 117 127 141
S/E 4.5 5 5.2 5.5 6.2 6.8 7.5 7.9 8.2 8.8 9.6 10
Advertising 5 5.5 5.8 6.3 7.3 7.9 8.6 9.6 10.2 11 11.3 11.9

Salaries 10 10 10.5 11 11.5 11.5 11.5 12 12.5 13 14 14

Off. Supplies 3.6 5 5.5 5.7 6.2 7 7.8 8.5 9.5 10.5 11.8 12.6

Utilities 4.5 5.5 6 6.3 7.5 8.3 9 9.5 9.5 10 10.3 10.8
Interest 5 5 5 5 5 5 5 5 5 5 5 5

Depreciation 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.2

Others Exp 2.5 2.8 3.5 4 4.3 4.3 5 5.5 5.8 6.3 7 7.3

Total O/E 36.3 40 42.7 45 49.2 52 55.6 59.2 61.9 65.8 70.2 72.8

EBT 3.7 8 14.3 22 31.8 37 41.4 44.8 49.1 51.2 56.8 68.2

Taxes (3.5%) 0.1295 0.28 0.5005 0.77 1.13 1.295 1.449 1.568 1.7185 1.792 1.988 2.387

Net Income 3.5705 7.72 13.7995 21.23 30.67 35.705 39.951 43.232 47.3815 49.408 54.812 65.813

PROFORMA INCOME STATEMENT (000’s)

2009 2010 2011


Sales 1440 1450 1469
Less: CGS 360 364 368
G. Profit 1080 1086 1101

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S/E 88 88.2 90.8
Advertising Exp 104 104.3 105
Salaries 144.5 145 146
Office Supplies 95.3 95.8 96
Utilities 98.9 99.5 101
Interest 63.5 63.5 65
Depreciation 15.5 15.8 16.1
Others 59.3 59.7 61
Total O/E 668 671.5 680.8
EBT 412 414.5 420.2
Taxes (3.5%) 14.42 14.5075 14.707
Net Income 397.58 399.925 405.493

CASH FORECAST ON MONTHLY BASIS FOR 2008 (000’s)

Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec

Sales 55 60 68 75 85 97 109 120 132 138 146 155


Payments:
Purchases 20 22 23 23 24 25 27 28 30 33 33 35
Selling
4.5 5 5.2 5.5 6.2 6.8 7.5 7.9 8.2 8.8 9.6 10
Expense

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Advertising 5 5.5 5.8 6.3 7.3 7.9 8.6 9.6 10.2 11 11.3 11.9
Salaries 10 10 10.5 11 11.5 11.5 11.5 12 12.5 13 14 14
Off. Supplies 3.6 5 5.5 5.7 6.2 7 7.8 8.5 9.5 10.5 11.8 12.6
Rent
4.5 5.5 6 6.3 7.5 8.3 9 9.5 9.5 10 10.3 10.8
expenses
Interest
5 5 5 5 5 5 5 5 5 5 5 5
Expense
Depreciation 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.2

Others 2.5 2.8 3.5 4 4.3 4.3 5 5.5 5.8 6.3 7 7.3
107.
T-Payments 56.3 62 65.7 68 73.2 77 82.6 87.2 91.9 98.8 103.2
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Cash Flow (1.3) (2) 2.3 7 11.8 20 26.4 32.8 40.1 39.2 42.8 47.2

2219
Beg. Bal 2,000 1998.7 1996.7 1999 2006 2017.8 2037.8 2064.2 2097 2137.1 2176.3
.1

2266
End. Bal 1998.7 1996.7 1999 2006 2017.8 2037.8 2064.2 2097 2137.1 2176.3 2219.1
.3

CASH FLOW (000’s)

2009 2010 2011


Sales 1242 1252 1265
Less: CGS 325 327 331
S/E 85 86 87
Advertising 101 102 103
Salaries 142 142.8 143.5
Office Supplies 94 94.5 95.2
Utilities 97.6 98 98.5
Interest 61 61.5 62.3
Depreciation 14.8 15.3 15.9
Others 58.9 60.5 61.2
Total O/E (979.3) (987.6) (997)
EBT 262.7 264.4 268

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Taxes (3.5%) (9.1945) (9.254) (9.38)
Net Income 253.50 255.146 258.62
Beginning Balance 2266.3 2519.8 2774.946
Ending Balance 2519.8 2774.946 3033.566

BALANCE SHEET (000’s)

2008 2009 2010 2011


ASSETS
C. Assets
Cash 2266.3 2519.8 2774.946 3033.566
Acc. Receivables 67.69 82.19 97.09 112.29
Inventory 93.7 94 94.5 95.2

Fixed Assets
Equipment 300 300 300 300
Less: (14.4) (29.2) (44.6) (60.5)
Depreciation
T. Assets 2713.29 2966.79 3221.936 3480.556
LIA & O/E
Account Payable 300 300 300 300
L.T.D 1000 1000 1000 1000

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O/E
Capital 1413.29 1666.79 1921.936 2180.556
T/ O.E 2713.29 2966.79 3221.936 3480.556

BREAK-EVEN ANALYSIS
Fixed cost= 306000

Variable Cost=7

SP=13

Total Fixed Cost / (Selling Price –Variable cost/unit)

306000/(13-7)

Quantity= 51000 units

MONITOR AND CONTROL:

1) Secondary Data:

For secondary data company will use the websites, different magazines and newspapers
and from different channels.

2) Primary Data:

For the primary data company will ask customers to give their views about its products

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to know what really customers wants and for the primary data company will also conduct
a survey from time to time to know about the demand of its products among the
customers.

CONTINGENCY PLAN:

In order to take the advantage of any opportunity or to meet the customer demand in
future the company will maintain a safety cushion for the cash needed and store house in
order to store the bags in the periods when there will lesser demand

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