Sie sind auf Seite 1von 16

Business Plan On

ADVANCE LABS PVT. LTD.


Providing a complete range of mechanical
product design, analysis and testing services

For
High Technology Venture Creation

Submitted To
Prof. Mukesh Patel

By
Naim Shaikh (094132)
Harit Tilva (094218)
Parth Mair (094240)
Sonam Tilva (094254)

On
December 7th, 2010
Contents
Sr. No Particular Page No.

1. Executive Summary 3

2. Opportunity & Market Analysis 4

3. Solution & Concept 6

4. Marketing & Sales 8

5. Product Development & Operations 9

6. Team & Organization 10

7. Risk 12

8. Financial Plan& Investment Offering 13

9. Detailed Financial Plan 14

10. Bibliography 16

2
Executive Summary
The company will be named as “Advance Labs Pvt. Ltd.” and will be based in city of Ahmedabad in
Gujarat state. The company would be providing a complete range of computer aided mechanical
product design, analysis and testing services.

The business is for SME of India who design and develop machines or components of automobiles
or machine tools but cannot afford to keep in-house professional CAD/CAM/CAE engineers.

The company would provide such professional CAD/CAM/CAE services at a cost that is much lower
than that incurred by keeping in-house professionals or avail services of large companies like Tata
Elxsi Ltd.

Gujarat a state in Western India, has been identified as an entrepreneurial hub of India, primarily
due to the innovative behavior of the Gujarati entrepreneur. Although Indian SMEs realize the
importance of technological innovation, most of the Indian SMEs still believe in importing
technology, rather than developing them in-house or through/in association with, national
Research and Development (R&D) centers. Indian SMEs, over the years, have largely ignored their
R&D and have mostly not embarked on new product development and technological up-
gradation. This is despite the fact, that India has the third largest pool of technologically trained
manpower. (1)

3
Opportunity And Market Analysis
Having new concept, there is vast opportunity to cover the customer base. Following are the
questions addressed in regards to market analysis

Problem or need being solved by the venture

It will provide solution to Micro, Small and Medium Enterprises (MSME) who cannot afford to hire
professional engineers for new product design and do not have resources for hardware and
licensed softwares.

The customer segment

Initially the MSME of Gujarat and later expanding to cover neighbouring states will be our market
segment because these industries are occasionally in need of product design but due to their
limitations they cannot afford. Thus we would be serving MSMS segment. We can call it as B2B
business.

Total addressable market and growth of business

There are 26.1 million MSME Units in India. SMEs are now exposed to greater opportunities than
ever for expansion and diversification across the sectors. Indian market is growing rapidly and
Indian entrepreneurs are making remarkable progress in various Industries like Manufacturing,
Precision Engineering Design, Food Processing, Pharmaceutical, Textile & Garments, Retail, IT and
ITES, Agro and Service sector. (2)

Specially we will be dealing with enterprises like Machine tools, Textile machinery parts, Diesel
Engines, Electric Motors, Auto Parts, Fabricators etc. Location of this cluster is situated at
Bhavnagar, Rajkot and Ahmedabad. (3)

Current market context favorable or not

It is much favourable due to following reasons –

• Many MSME suffers innovation barrier due to their financial innovation so they could not
create new form or reform of their product so this idea will help them to innovate more

4
• There will be greater level of Cost saving for client (MSME) as they themselves are
outsourcing from us.
• They could become more competitive in market through their more innovative/Creative
products which will design by us.

5
The Solution And Concept
The service:

With our engineering background we can offer mechanical design outsourcing and design &
development of tools, jigs, fixtures, moulds, patterns, components, and machine assemblies etc.,
to improve productivity, cost, safety and quality for products. The company’s team of engineers
would use proven methods to conceive, design and prototype.

We will have expertise in the below areas:

• Tool Design
• Jigs and Fixtures
• Product Design
• Engineering Services

More services would be added after a couple of years like Stress Analysis, Finite Element Analysis,
Virtual and Rapid Prototyping and Fatigue Analysis.

Value Proposition:

The capabilities of the company provide the clients with a unique opportunity to:

• Reduce the cost of a new product launch


o Lower cost of product design due to elimination of in-house technical jobs and
software licensing requirements
o Reducing the number of prototype mock-ups delivers real cost and time savings for
most design cycles
o Reducing the time and expense of testing and validating prototypes. By decreasing
testing and prototyping time, a new product can be brought into production
quicker
• Reduce the cost of a product
o Reducing the number of components in a system by assessing opportunities to
combine parts and optimize linkages
o Analysing designs can result in lighter parts and utilization of less expensive
materials

6
• Produce a superior product
o Reducing the weight or increasing the durability of a product
o Decreasing failures reduces warranty claims, causing greater customer satisfaction
and possibly lower maintenance costs

Uniqueness of the project:

The company is targeting SME and also take up small projects. Other companies target large
domestic, multinational or foreign companies. The reason is that SME too have design
requirements. They being small cannot afford dedicated design development and extra cost
associated with it like trained professional and software licenses. The main reason why they
cannot afford to have a dedicated department is because their requirements are occasional. So,
by targeting SME we would be targeting a much broader market segment.

Business Model:

The company understands the customer’s business requirements with its strategic and operational
importance. The company’s joint expertise and experience vouch for that it can provide complex,
all-encompassing solutions, where it takes responsibility of the all the design requirement of the
customer.

The company would be following Time & Material (Effort based pricing) in this pricing model, the
project cost is a function of the total project execution time and the corresponding resources
deployed. This engagement model is particularly useful in contexts where the projects are quite
complex and are prone to specification and design changes midstream.

7
Marketing And Sales
Marketing Medium

There will be three modes of marketing, i.e. Advertisement and promotion in technical magazines
in the engineering industry, participation in various exhibitions that are held across Gujarat and
pitching to the target clientele through Personal Selling. Considering the complexity and dynamics
of the industry, participation in exhibitions and conferences seems to be the best option for
increasing the customer base. The managers visit such conferences and exhibition in search on
new technology, suppliers, customers and consultants in order to grow their businesses. Thus the
exhibition provides such one to one interaction with more than one future client at a single place.

Decision Making Process

Designing department of various small scale companies are not well developed, thus their
functionality puts a dilemma for the managers that whether to rely on internal resources because
designs have to practically feasible with least possible resources. The decision making power rests
with the production manager or the product development manager as well as the managing
directors who takes the final call o the issues mentioned.

Expected Sales Cycle Length

The sales cycle length can vary customer to customer and the products that are being developed.
A long term project, suppose 1 year, with multiple stages, suppose 4 stages, the sales can be
generated at every stage of the product development process. While a short term project with
single phase of development, the sales cycle is dependent upon the final outcome of the product
designing. Expected sales cycle length- one week to 2 months.

Partnerships

Strategic partnerships with leading small scale industries could provide an edge for the business.
With indirect approvals of such organizations, the assurance of quality of the work increases for
other companies.

8
Product Development And Operations
Current Stage of Development

Currently the project in under business proposal analysis and have identified key team members
and their roles and responsibility in the organization. Also this is a service based industry and
requires far less resources to start as compared to a manufacturing unit.

Resource Requirement

Human Resource: We would be starting the company with just two design developers (Proficient
in CAD software) and two promoters who would be looking after marketing general management
and financial aspect of the business as well as actively participating in design development. We
plan to hire more developers in second and third year when the business grows. And responsibility
of the promoters would shift towards business development and financial aspect of the company.

Computers and software: We would require computer and servers to work. We would purchase
computers as and when required due to increase in strength of developers. We plan to start the
business with licensed softwares - AutoCAD 2D (3) for 2D drawings and Pro/Enginner (1) for 3D
drawing. The reason for using these softwares is that they are the most popular software and
developers are easily available for these softwares. We would buy more licences for AutoCAD and
Pro/Engineer in second year and third year. We would also purchase ANSYS for stress analysis in
third year.

Other Resources: Other resources required are internet, phone, printer, plotter, rented office,
stationary, furniture, AC and other electrical equipment etc.

Planned Development Timelines:

• We propose to increase the strength for just 2 full time developers to a team of 10
developers along with a team leader in three years.
• We would also like to increase the level of competency and widen the scope of services
provided in three years. We would like to provide stress analysis fatigue analysis and virtual
prototyping in coming years.
• We plan to breakeven in second year and we estimate payback period to be between two
to three years.

9
Team And Organisation
Very Significant issue to be confronted is Team of the company. Below are the issues addressed:

Backgrounds & roles of the founder and early key employees

1. Sonam Tilva - B.E. (Mechanical) and MBA ( Entrepreneurship)


2. Harit Tilva - B.Tech (Mechanical) and MBA (Entrepreneurship)

Both promoters have product design experience of more than 5 years on various CAD/CAM/CAE
systems. Hence during the growth phase, both promoters will be actively participating in the
product design work and marketing. One of the promoter will also look after the finance.

Key hires to fill out the team

Initially, two employees will be hired i.e. CAD engineers from CAD Training Centres and with some
Industry experience. Hiring employees will be gradual process and will match organization growth.
Team could include

• Product Designers – Hired from CAD training centres and from industry.
• Team Manager – To assign a group task there must be one Team manger which will
supervise and control the team and will be responsible for report to higher authority.

Skills of the team

Skill requirement will be discussed by Skill Set Matrix

Skill Sonam Harit Designers Team


Manager
Technical Skills AutoCAD X X X X
Pro/Engineer X X X X
CATIA X X X
Management Skills X X X
Creativity & Innovation X X X X
Marketing Skills X X
Finance & Accounting Skills X X

10
Head Counts levels forecasted in each functional area

Year Year 1 Year 2 Year 3


Designers 2 5 9
Team Manager 1
Marketing 1 1 1
Finance & HR 1 1 1

Does the company have advisors or board members

At first, no advisor or board member will be consulted but at 3rd year we will plan to have advisor
or board member so till then organization will also be enough to mould in professional way.

11
Risks
Technology/Product

• Change in technology and obsoleteness of the machines and softwares employed.


• Low cost R&D scale machines that can be utilized directly by the companies to design and
develop prototypes.
• Large scale use of pirated softwares by the Micro and Small industry brings down the
product development costs.
• Number of product design that can be focused upon simultaneously can prove to be hurdle
when catering to number of customers.
• The compatibility of technology and machining between the company and the customer’s
firm.

Market/Competition

• The large companies develop their own designs and supply it to OEMs which takes us out
of the picture.
• Idea can be easily imitable by the other technocrats with experience in product designing.

Management/Team

• Hiring and retaining of technical staff that are well versed with CAD/CAM/CAE.
• Confidentiality of the products and designs being developed is the major issue of concern
to the outsourcer.

Financial

• Significant investment goes into acquiring hardware and softwares and hiring technically
competent staff.

12
Financial Plan And Investment Offering
Funding requirements

The promoters of the company will do a 50:50 partnership. The initial investment required for the
company is roughly Rs. 7.60 lakh and additional investments of Rs. 3.50 lakh and Rs. 11.00 lakh.
These investments would be done solely from the funds available with the promoters and no debt
or equity investments from 3rd parties will be done.

However a bank loan will be taken in the 4th year to finance the purchase of an office.

Cash Flow

The venture is expected to be cash flow positive in the 2nd year.

Growth Opportunity

The growth of the company will be rapid in terms of range of services offered. New services
would be added each year as more specialized designers are added to the team. The sharing of
knowledge and training sessions within the team would help in overall learning of individual team
members and increase the capabilities of the team as a whole.

Year 1 Year 2 Year 3


Man-hours 5,000 12,000 20,000
Rate (Rs./hr) 200 250 300

As the work complexity is increased, a higher rate will be charged and hence the average rate
charged would increase. The work is also highly undervalued as compared to competitors. (4)

Key Financial Assumptions

• The work measured in terms of man-hours of efforts put in is estimated.


• The software licences cost are considered as one time charges based on prices quoted on
different websites and there would be no annual usage charges.

13
Financial Projections
Investments

Year 1 Year 2 Year 3

IT Infrastructure
Computers 120000 90000 150000
Server 50000 50000
Printer/Plotter 10000 150000
Networking 10000 10000
Electrical Systems 30000 30000

Interiors
AC 25000 25000 25000
Furnitures 50000 10000 10000

Softwares
Autocad 2D 60000 40000 40000
Pro/Engineer 150000 150000 300000
ANSYS 300000
Windows 2008 Server 32000 32000 32000
Tally 9 12000

Deposits
Office 200000
Telephone & Bank 10000

Total 759000 347000 1097000

14
Employee Salary Costs

Year 1 Year 2 Year 3

Promoters 4,00,000 5,00,000 6,00,000


Team Manager 0 0 3,00,000
Lead Designer 0 0 3,00,000
Designers 3,00,000 8,50,000 15,20,000
Peon 50,000 55,000 61,000
Total Employee 7,50,000 14,05,000 27,81,000

Estimated Profit & Loss Statement

Year 1 Year 2 Year 3

Revenues 10,00,000 30,00,000 60,00,000

Expenses
Salary 7,50,000 14,05,000 27,81,000
Electricity 1,51,200 2,52,000 3,52,800
Marketing 2,40,000 3,00,000 4,80,000
Internet 12,000 12,000 12,000
Phone 18,000 30,000 48,000
Website 6,000 6,000 6,000
Fuel 60,000 84,000 1,20,000
Stationery 12,000 14,400 18,000
Maintenance 12,000 14,400 18,000
Overheads 24,000 30,000 36,000
Rent 3,60,000 4,00,000 4,40,000
Total Expenses 16,45,200 25,47,800 43,11,800

PBDIT -6,45,200 4,52,200 16,88,200


Depreciation 2,84,400 3,00,961 7,57,584

PBIT -9,29,600 1,51,239 9,30,616

15
Bibliography
1. Kacker, Stuti. Overcoming Barriers to Innovation for Indian SMEs. Barcelona : INSME, 2005.

2. SME Chamber of India. [Online] [Cited: 12 5, 2010.] http://www.smechamberofindia.com/.

3. MSME Cluster - Indian MSME. Foundation For MSME Clusters. [Online] [Cited: 12 05, 2010.]
http://www.msmefoundation.org/indian_msmecluster.aspx.

4. Design Outsourcing. Solution 4 Plastic. [Online] [Cited: 12 05, 2010.]


http://www.solution4plastic.com/design-outsourcing.html.

16

Das könnte Ihnen auch gefallen