Financial Modeling for the Social Sector

Assignment 2

- Insert your assumptions and responses

- Calculated by formula

BOUNDING THE OPERATIONAL UNIT Scenario 1 Scenario 2 Scenario 3 Scenario 4

(1) Total population that can be reached by an Operational Unit 55,000 55,000 55,000 55,000
(2) % of that population that are potential target of the operation 50% 45% 35% 25%
(3) = (1) x (2) The size of the potential target market (Available Target Market) 27,500 24,750 19,250 13,750
(a) Penetration rate (%) of the product/the service in the market 5% 5% 5% 5%
(b) Market share (%) of your venture at steady state 30% 30% 30% 30%
(4) = (a) x (b) Penetration rate of your venture at steady state 1.5% 1.5% 1.5% 1.5%
(5) =(3) x (4) Operational Unit's customer/beneficiary base at steady state 413 371 289 206
(c) The products intended frequency of use (per Month) 4.00 4.00 4.00 4.00
(d) The product's average repurchase rate by consumers (per Month) 100% 75% 50% 25%
(e) The size of the customer unit 1 1 1 1
(6) =(5) x (c) x (d) / (e) Operational Unit's monthly customer transaction numbers at steady state 1,650 1,114 578 207

Notes on your assumptions

Share how you've decided to use some of the key assumptions in the above calculation
One operation unit in wardha district (scenario 1)
-it will serve 28% of the districts population (1,78,000) concentrated in urban and semi-urban areas
-Enterprise targets family (customer unit) with children 2-5 years of age
-Considering income and knowledge base of potential customers the enterprize has a 5% penetration rate
-It has a market share of 30% because the market lacks products that would directly impact childrens health positively (considering good advertising)
-The product is sold in a package that can be used 5 - 7 days of the week.
-Average repurchase rate will be 4 times per month considering that a child would consume 1 pack per week

Other scenarios are considering households with low income levels, that will not buy the product each time as needed.
Reflections
What have you noticed from this exercise? If you have tried to scenario test using different set of assumptions, share your findings here
The excerise has helped me to put ideas into context and understand the building blocks of each ventures' foundation

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