PROJECT: BUSINESS PLAN OF ‘BIO PEN’

 SUBMITTED TO:
PROF: SALMAN PIRACHA

 SUBMITTED BY:

 MUZAMMIL HUSSAIN SAQIB 36

ZEESHAN 34
 AMIR SHEHZAD 32
 ABDUL WAQAS 60
 MUHAMMAD IRFAN 24
Business Plan

OWNERS

HAPPY BROTHER &CO

Satellite town Sargodha

Web site: WWW.Happybrothers-uos.blogspot.com

 Table of Contents

I. Table of Contents .............................................................................................. 3

II. Executive Summary ........................................................................................... 1

III. General Company Description ..................Error! Bookmark not defined.

IV. Products and Services........................................................................................ 8

V. Marketing Plan ................................................................................................. 10

VI. Operational Plan .............................................................................................. 18

VII. Management and Organization ...................................................................... 22

VIII. Personal Financial Statement.......................................................................... 23

IX. Startup Expenses and Capitalization ............................................................. 24

X. Financial Plan ................................................................................................... 27

XI. Appendices ....................................................................................................... 38

XII. Refining the Plan .............................................................................................. 35

Executive Summary

We are going to start a new business with the name “happy brother & co”. It’s a
partnership business with five partners named as Muzammil Husain saqib,
Zeeshan, Amir Shehzad, Abdul Waqas and M.Irfan. All partners have equal capital
of RS.100000 and loan of RS.250000 will be borrowed from a financial institutions.

The philosophy behind this business is that people are very

busy and want to save their time. They also want to protect their time and money
from buying different medical equipment for different diseases. They face
problems in buying more than one instrument for different diseases and they are
not confident about them.
 We are going to provide the three solutions for three
problems in one product BIO PEN which they can use when they want. Our aim is
to protect life and time of people.

We are targeting upper and upper-middle class with respect

to income level. These people are more health conscious and busy in life. They
want to live a prestige life. There is no age limit for our business because in this
busy life everybody is troubled by blood pressure, temperature and sugar.

We are bringing innovations such as three in one, facility of home-delivery

and online purchasing.

We are very hopeful to capture majority share of the market

of Sargodha. People are going to be more health conscious due to education and
media awareness programme .There will be more trends to save and spend each
and every second in useful way. We are looking our future bright because there
are more opportunities for our business to expand nation-wide.

Business objectives
The primary objectives of business plan for Bio Pen are below.

To provide a product of medical check-up in multi dimension function.

To save the time of our customer.

To facilitate our customer to make check up himself easily.

To provide product at any time with quality.

Mission Statement
Our mission is to provide experience to our customer as he get when treated a
doctor.
We will strive to achieve this goal.

..By providing product with best quality.

By providing product at reasonable price.

By providing complete satisfaction to customer and getting high loyalty for him.

By providing product at any time

Guiding Principle
Being mindful of our customer and our staff. We will treat both our customer and
staff in manner in which we would want to be treated or better ourselves.

Gratitude
Any attitude of gratitude shown to our customer employees and vendors.
Because without their input, services, labour and time, our business would not be
here without them.

Our Services
Provide the warm and friendly services expected from medical equipment,
manufacturing organization creating and informal, comfortable environment
which will make the customer satisfied and loyal.

Key to success
Hire top management and technician and offer training to keep them on top of
his game, and pay top wages to ensure that they stay without.

Location
Convenience is essential to us. we need to be close to our market because we are
not trying to get people to travel to reach us.
 Offering of reasonably priced and quality product to establish credibility but
not so high as to limited the customer.

Repeat Business
Every customer how comes in once should want to return to recommend us and
give feedback about our product.

General Company Description

The traditional medical store surgical centre & stores of medical equipment an
located at satellite town chowk Sargodha. The organization will be owned and
operated by five members MUZAMMIL, IRFAN, ABDUL WAQAS, AMIR, and
ZEESHAN. The organization will serve the customer with variety of product
supporting facilities. The organization will be open 6 days in a week with 8 hours.

OWNERS
The organization will be owned by five members Muzammil Husain ,Amir
Shehzad ,Zeeshan ,Abdul Waqas, Muhammad Irfan (Happy Brothers) having
qualification of MBA finance and marketing . In the organization they will be held
at the position of assistant managers and general managers’ .With the high
turnover of help for the organization, we will relay on family to fill in where
required until we are off the ground for making a profit.

LEGAL FORM
The Happy Brothers Association will be organized as partnership owned and
operated by Happy Brothers mentioned above .As medical equipment assembling
organization the organization licensed by Pakistan Engineering Council and certify
by ISO.
Start up summary
The cost of open the HB organization is Rs 750000.the majority of expenses are in
sensor purchasing & equipment purchasing totally is Rs 227300. The location
requirement some build out and renovation totally Rs 70000 & will approximately
30 days to complete the owners will sub-contract themselves. Rs 500000 of start
up costs will be funded by owners. The owners sources of funds is a combination
of liquid assets and loans account payable.

Location and Facilities

The organization will be located in satellite town Sargodha near to KIPS academy
because this most crowded area with respect to hospitals and medical
pharmacies.

Product and Services

Technical Specification
Our product is bio pen which required blood pressure measures, Thermometer
and sugar measures and sensors. These items are assembled in a pen so it is
called Bio Pen. It will be used to measure temperature, sugar and blood pressure
at time with same device.

Photos

Sales Brochures

Map of photos of location

Copies of documents
Competitive Advantages
The competitive advantages of our products is 3 in one, it means our products is
confirmation of 3 products like thermometer, sugar checker and blood pressure
measurer so it is our competitive advantage.

Disadvantages
Our is confirmation is three types of sensors and raw materials so it cost of
production will be high so we have to set prices high using skimming pricing
strategy. so it is disadvantages for us.

Pricing, Fee or leasing structure

The product is mixture of three different costly components so its cost of
production will be highly set so we have use skimming price strategy so our
product price will be Rs 6000 because average prices of sugar measurer has
market prices Rs 2400 thermometer digital has price Rs 200 blood pressure
measurer has prices Rs 2000.

Marketing Plan
Population of Sargodha is 594000 and 26.7% live urban area. We can capture
marketing easily because we have potential. We believe in social marketing
because we research about successful businessmen then we can say that. They
believe in social marketing and other view is Islam. In Islam business place a great
rate in economy. Now days almost every person has a problem of blood pressure,
sugar, Temperature. So definitely our target market is very vast and we have
potential for growth our prices strategy is skimming and we focus on elite class. In
Sargodha Pakistan businessmen lawyer, doctors student and almost every person
is health conscious. So that is our major market. The systematic research is
required for successful venture. It ensures that business on track and can face any
difficulty business planning process is used as opportunity to uncover the data
and to question to all market effort.

Tools of Marketing Research

There are two type of tool of marketing research.

Primary tool
We have conducted a survey of than 400 people with 10-11 questions regarding
competitor, acceptance of our business proposal, health, importance of time
saving and to learn about customer behaviour and his preference. We visited
different surgical and medical shops which provide this type of product and get
feedback from them.

Secondary tool
In secondary tool we mainly focused on World Wide Web for research purpose to
cover our business plan. We find it very helpful to provide this type of product
with a mindset of 3 in one. It was amazing for us to know that there is no such
type of business operating in Pakistan. By analysis our research material we
conclude that it could be very profitable in such busy life.

Economies
Size of Market:

We currently focused on elite class of Sargodha city. Our major portions of

customers exist in “Officer Colony” who is time and health conscious.

Current Demand:
We expect more demand by elite class because we are going to provide them a
product which saves their time and selection; we are providing this product to
both private and Govt employees in required colures.

Trend in target market

Now in market people use this type of products for different functions. For
example different devices are used for different problem like BP problem,
Temperature, sugar and blood group. So we introduce new in market by giving
solution of all these problems by single product.

Barriers:
We may face following barriers.

Consumers’ acceptance and brand recognition of our product.

Lack of experience as we are first time in business world.

Local government rules can be barrier for us.

Changes in Technology.

Solution to problems:

We will promote our business using all tools of promotion I.e. local cable, radio
(FM 96, 93,104) and local newspaper (daily express Sargodha and daily “NAI
BAAT” Sargodha.

if it is possible we will try to get an expert partner to reduce the risk of

uncertainty due to lack of experience.

The risk of local government rules, we will reduced it through proper licensing and
registration.

Change in technology will reduced by adaptation of customer requirement.

Product
Our product includes the following.

Bio pen which includes thermometer, sugar test chip, BP measure and blood
group tester.

Our service will be:

Online purchasing

Home delivering

Features and Benefits

Our product will be quantitative which gives following benefits and having
following features.

Usable friendly

3 in one package

ISO certified

Tested by doctors

Time saving

Reliable

Customers
Our target market is elite class. They are health conscious and have high level of
income so they can afford our product.

Our product will be for every aged customer without

Educated people can be specially target customer.

Competition

 We are providing a unique product so companies like accu check providing

this type of product is competitor for us in market.
 These are mainly located in satellite town chock Sargodha.
 They will try to compete with us in term of prices, and customers.
 Our product and services are compared with competitors in term of price,
quality and home-delivery.

Niche
 We deduced that our niche market is elite class of Sargodha city. These
people possess the purchasing power and try not to directly purchase from
market.

Marketing strategy
(1)Promotional strategy

 Inviting “big gun of city” in inauguration ceremony by sending invitation

card.
 Advertising through free sampling to elite and middle class.
 Direct marketing by sending mail or message to prominent persons of city.
 Creating opinion leader for promotion of product and services.
 Advertising can be through broachers and catalogue publishing.
 Billboard, signboard and poster development is another source of
advertising for us.
 If our budget we will advertise on FM-93, FM-96.Our audio ad is ready
prepared by our group members.
 In the same way our group leader has prepared the print ad regarding BH
bio pen.
  We will ask our friends to public our product and services.

We will have a system that maintain contact list of loyal customers to increase our
sale and to have edge over competitors.

Promotional budget:

 We will spend on promotion about Rs 800000.

 Start-up budget is about Rs 30,000
 On-going budget is Rs 40,000
Pricing strategy
 We are going to charge the “skimming “price for our product and services.
 Our prices are higher than competitors because we are providing superior
quality product at their door step.
 There is no credit policy because our target customers are elite class who
make on spot payment.
 The upper class is not too much price sensitive. They only need comfort
and time saving.

Place

 We proposed “satellites town Sargodha” as location for business.

 The location is not important for customers that are purchasing with
home delivery.
 Our proposed location is best because this place is hub of Sargodha city
and most people have visited there if they move from city.
 The customers can easily make a direct purchase from us.
 Here most of competitors reside. It will better near to them so that
people can understand the quality and services differences.
Distribution channel

 We will have both retail and direct (mail order, web and catalogue) sale of
product.

OPERATIONAL PLAN
Free home delivery as per order will be as above Rs100.

Our operation firstly starts from taking the orders from customer. We take
material from warehouse and assemble the product and then packing starts. After
completion of packaging our delivery operation start. We organize our data
according to areas for smooth operation. We take orders through mobile phone
and e-mail service.

Delivery Information
Happybrothers-uos.blogspot.com delivery systems are uniquely designed to
provide you the ability to select a convenient time to receive your purchases
either during the day or night. You can pre-book your delivery slot during check-
out and be assured that the goods will be delivered as per your booked slot. To
maintain the quality of service and product we will take extra steps.
Delivery slot:
Happybrothers-uos.blogspot.com provides a unique service and promise of
delivering the goods in 2-3 hour window based on the delivery slot selected by
you. This ensures certainty and aids in planned purchase of your household needs
and eliminates long waits staying at home without knowing the exact time of
delivery or even missing your delivery.
You can check the availability and book your delivery slot at the time of checking
out. For your convenience we make deliveries on all 6 days in a week and 312
days a year with Sunday holidays!

Delivery Timings (Slots) available 6 days a week

Slot No Delivery Time Order Placement Cut-
Off Time
Delivery Slot 1 08.00 AM to 11.00 AM Previous Day 10 PM(special
discount)
Delivery Slot 2 03.00 AM to 06.00 PM 02:00 PM
Here one problem is raised that prices are fluctuate due to uncertain political
position. We solved this problem by daily update rates through messages and
website. We shall take orders previous day of 7 PM by this method we can
estimate demand and we can save our time and damage of product. If any unit
remain undelivered then we shall store it for saving from damage

. Payment style:
Payment style in cash our representative will come to home then
cash payment is only acceptable.

Strategic alliances with suppliers:

We shall do strategic alliances with suppliers for the purpose of security.
Our terms and conditions are contained about delivery of material, because we
want to deliver product at time to our customers. By this alliance we shall get
competitive advantage and we can do operations without any hurdle.

Initially we shall hire two bikes for delivery and Sargodha will be divided into
blocks for smooth operation. These bikes will be hired on commission base.

Employees:
 Production manager: This person handles all purchasing and production of
product must have MBA degree.
 General Manager: he will be head of firm and administer all operations.
 Assistant manager: he will assist the general manager to admin the
operations
  Drivers: Two drivers are required for delivering of product. They must have
driving license and know about roads.
 Sales manager: one sales manager which has market knowledge and his
qualification is MBA.
 Technicians: Two technicians are required for assembling the product and
packing.
 Guards: four guards who secure the firm day and night.
 Book keeper and call representative: Two persons will manage call and
documentation and receive orders from customers. Their qualification must
be B.com and have knowledge about computer software. Training are
required for enhance their capabilities but limited training will be best.

Personnel

 No of employees

Description Names
Owner/general Abdul
Manger Waqas
Assistant Zeeshan
Manager
Production Amir Shehzad
Manager
Sales/marketing M.Nasir Arshad
manager
Electricians/Technician Ghulam Ali M.Irfan Awais ali Waseem Ali
Bookkeepers Ch.Naseer M.Amir
Security Usama Zaid Zain Aman
Guard
 Type of labour

Skilled Unskilled Professional

Electrician/Technician Security Guard General manger
Book keeper Assistant Manager
Production Manager
Sales manager

Where and how will you find the right employees?

We will advertise our vacancies for P.M, S.M, Electricians, Book keeper and
security guard on newspaper, Face book and F.M. After recruiting we will get
competitive employee through interviewing them.

 Job description for employees

For Electrician
It is electrician that he has complete experience or skills to assemble sensor
with device. He must have two year experience in this regard and at least should
be diploma holder of Electrical.

For Management
Every employee must be MBA holder &has at least 2 year experience.

For Book keeper

Every book keeper must have qualification of BBA or B.com & well award will
account principles.
For Security Guard
He must have weapon license and must be qualification of matric.

Schedules and procedures:

Post Timing Salary
(Rs)
1st computer operator 6:00 AM to 2:00 PM 12,000
Phone operator

2nd computer operator 6:00 AM to 2:00 PM 12,000

Phone operator

Sales man 6:00 AM to 3:00 PM 8,000

2 labour 6:00 AM to 3:00 PM 6,000

Total 48,000

Suppliers:
Our suppliers of parts of our product will belong to Pakistan.
We concern with other cities of medical equipment markets. The
list of suppliers are given below:

Alam Medix +92-42-373

Office No.9/1, Hanan Plaza, Mayo Hospital Road, Lahore - Pakistan
Categories: Medical Equipment & Supplies, Surgical Instruments,
Ali Surgical +92-42-37221279
3 Afendi Mansion, Chowk Mayo Hospital, Lahore
Categories: Medical Equipment & Supplies, Surgical Appliances,
Surgical Supplie...

Becton Dickinson Pak Pvt. Ltd +92-42-35718056

19 D/1, Gulberg III, Lahore
Categories: Medical Equipment & Supplies, Needles, Surgical
Instruments, Surgic...

Biotech Pakistan Private Limited +92-42-35868236

House # 176, Block C, Model Town, Lahore
Categories: Medical Equipment & Supplies, Sterilizing Apparatus,
Surgical Appli...

Butt Brothers & Co. +92-42-37233841

9-Mcleod Road, Lahore
Categories: Medical Equipment & Supplies

Digionics (Pvt) Ltd. +92-42-37576445

15 Shadman, Main Jail Road, Lahore
Categories: Medical Equipment & Supplies

Dodhys Agencies (Pvt) Ltd. +92-42-36373634

Dodhy Building, 14- Davis Road, Lahore
Categories: Medical Equipment & Supplies
Management and organization

Our concern basically with societal marketing and there we also adopt
decentralized system for convenience. Every week we shall conduct meeting for
improvements and how can we utilize our resources to capture our market.

We will get Rs 250000 loan from financial institution, because we have need for
loan to start business.

G.M

Assistant
Manager

Production marketing Accountant & call

technition guards
manager manager representative

Personal financial statement

We have Rs.700, 000 to start this business.

Partners Cash %age

Muzzamil hussain saqib 100,000 13.33
Zeeshan 100,000 13.33
Amir shehzad 100,000 13.33
Abdul waqas 100,000 13.33
M. irfan 100,000 13.33
Loan 250,000 33.33
 Cash

100,000
250,000
100,000

100,000 100,000

100,000

Start-up expenses and capitalization

Machinery and equipment’s:
Machinery Quantity Cost/unit Total price

Mobile 1 3000 3000

phone/telephone
Test machine 1 10000 10000
Exhaust fans 2 1700 3400
Water cooler 1 500 500
Air conditioner 1 32000 32000
Total 48900
Furniture and fixtures:
Furniture Quantity Cost/unit Total
cost

Aluminium 4 15000
shelf
Furniture 30000
Lights 5 125 625
Fan 3 2200 6600
Generator 1 30000 30000
Computer 2 7000 14000
Printer 1 8000 8000
Total 104225

START-UP EXPENSES
The estimated start-up capital and expenses as under:

Start-up Capital & Amount in Rupees

Expenses
Advance payment to 230,000
supplier
Furniture and fixture 104225
Advertisement 80,000
Advance rent 2 months 70,000

Machinery and 48900

equipment’s
Registration expenses 10000
Unforeseen (Contingency) 30,000
Total 573125
 18.18
1.7448
5.234

8.532
8.1875 Advance payment to farmers
Furniture and fixture
Advertisement
40.13
Advance rent 2 months
13.95
Machinery and equipments
Registration expenses
Unforeseen (Contingency)

18.18

Utility requirement:
Utility Charges(monthly) Charges(annually)
Electricity 10000 120000
Telephone with 5000 60000
internet
Gas charges 2000 24000
Total 17000 204000

Financial plan

Sales forecast:

Sale Daily Monthly Annually

Item units Price Total 300 units 3600
units
Bio pen 10 8000 80000 2400000 28800000
Total 80000 2400000 28800000

Cost of above estimated average sale

Cost Daily Monthly Annually
Item units Cost Total 300 units 3600 units
Potato 10 6500 65000 1950000 23400000
Total 65000 1950000 23400000
 HB & co

Projected income statement

For the year 30 December, 2014

Descriptions’ Amount
Rs
Sale 28800000
Less Cost of goods sold 23400000
Gross profit 5400000
Less Selling & admin expenses
Salaries 3672000
Telephone and gas charges 84000
Electricity 120000
Stationary expense 4000
Rent 420000
Advertising expense 80000
Other expenses 30000
Depreciation expense for Equipment & 9780
Machinery
Depreciation expense for furniture & fixture 15634
Loan and interest paid 287500
Net Profit 677086
 Projected Income statement for the year 2015,2016,2017,2018
Year 2015 2016 2017 2018
Descriptions’ Amount Amount Amount Amount
Sale 2950000 30300000 31000000 3150000
0 0
Less Cost of goods sold 2380000 24300000 24700000 2530000
0 0
Gross profit 5700000 6000000 6300000 6400000
Less Selling & admin expenses
Salaries 3745440 3820349 3896756 3974691
Telephone & gas charges 89000 95000 102500 103500
Electricity 122000 125000 129000 130000
Stationary expense 4500 4900 5200 5400
Rent 428400 436968 445707 454621
Advertising expense 84000 88200 92610 97240
Other expenses 33000 35000 35500 34400
Depreciation expense for Eq& 7824 7060 5647 4518
Machinery
Depreciation expense for furniture & 13289 11295 9601 8160
fixture
Net Profit 1172547 1376228 1577479 1587570

HB & co

PROJECTED BALANCE SHEET

(ON FIRST DAY OF BUSINESS)

ASSETS RUPEES LIABILITIES & Equity RUPEES

Current Assets Current Liabilities
Cash at Bank 236875 Loan from bank 2500000
Advertisement 80,000 60,000 Equity
Less expire 20,000
Advance payment to 230000 Muzammil Husain 100000
suppliers saqib
Advance rent 70000 Zeeshan 100000
Fixed Assets Amir shehzad 100000
Furniture and fixtures 104225 Abdul waqas 100000
Machinery & 48900 M.irfan 100000
equipment
Total 750000 Total 750000

Break even analysis

The break even analysis has carried out showing the level of sales at which the
state of no profit and no loss occurs. This is the minimum sale level below which
the business cannot operate to avoid the losses. At this point business will recover
its operating expenditures only. The minimum monthly and yearly revenue
generated HB association at which business gains zero profit will be under:
We have already mentioned sales per unit price. We have no units but assume 1
bio pen is our unit then our sales per unit will be 8000.
Now we conclude our variable and fixed cost.

Fixed Cost
Descriptions Amount annually
Rent 35000 420000
Salaries 306000 3672000
Electricity 10000 120000
Telephone with internet & gas 7000 84000
Stationary 333.333 4000
Advertising 5000 60000
Total 363334 4360000

Variable Cost

Description Amount Amount

Product cost 23400000
total 23400000

Total variable cost annually = 23634000

Total fixed cost annually = 4360000

Sales price per unit = 8000

Variable cost per unit = 6565

Break even sale= Fixed cost/sale price per unit –variable cost per unit

Break even sale= 4360000/8000-6565=3038.3 units annually

We must sell at least 3038.3 units annually in order to break even,

including fixed cost annually. Monthly we sell 253.193 units in order to
break even.
Table: Cash Flow

Pro Forma Cash Flow

Year 1 Year 2 Year 3
Cash Received

Cash from Operations

Cash Sales 28800000 29500000 30300000

Subtotal Cash from 28800000 29500000 30300000

Operations

Expenditures Year 1 Year 2 Year 3

Purchasing of goods 23400000 23800000 24300000

Cash Spending 4206000 4298340 4385417
Bill Payments 204000 211000 220000
Subtotal Spent on 27810000 28309340 28905417
Operations

Cash Balance 990000 1190660 1394583

Refining the plan
Retail business plus services:

Company image:
The image of company will be projected by its unique quality products and
services. After a short period of time it will be most reputed in public especially in
elite class .It will save both time and life of people in most economic manner. To
bring ease and comfort in life of people is first priority .The people will buy our
branded product.

Pricing:
 Our price strategy is “skimming” price strategy .We are charging little bit
more price because of our services such as home delivery.
 This price is profitable, competitive, and is accordance with our company
image.

Inventory:
 The inventory purchased by us is best in quality and prices are consistent
with our brand image.
 We are purchasing sensors and other material directly from credible
suppliers those has competitive image in market.
Customer service policy:
 Customer loyalty is the backbone for our business.
 Loyal customer is our main asset in both short and long-run.
 Customer’s satisfaction is our primary priority and profit maximization is
secondary.
 To achieve customer’s loyalty we are maintaining data-base of customers.
 Loyal customer is given free package like free home delivery.
 The customers will be retained through high quality product and services.
 We are trying our best for customer retention that is most important
function in current competitive environment.

Location:

 We are located at satellite town chowk Sargodha. It is the best location as

we required.
 It is placing where mostly persons of upper class visit for purchasing
medicines.
 People can conveniently buy bio pen from us.
 This place is also best for in-time home delivery to customers resident in
Officers Colony, PAF BASE and others.
 Timely home –delivery are our core competencies that why this place is
consistent with our business position and image.

Promotion:

 Free sampling to upper and middle class is about Rs 7000

 Brochure and catalogues is about 7000
  Advertisement on FM96 costing 12000/month.
 Promotion through opinion leader such as expert cooker or
doctor.
 Special package for loyal customers.

All this will promote our brand image. More and more people will come
to know about our products and services. This will bring more revenue
for our venture.

Credit

Yet we are not going to provide credit facility our customers. This is
justified because we are currently targeting elite class who are in
position to make on spot payment.
Primary and secondary packing:

Photos of near location:

Photo of head office: