CHAPTER 1 1. INTRODUCTION 1.1 Entrepreneurs profile Name - RAHUL M Age-19 Address-Wilson Garden, Bangalore.

Qualification-pursuing BBA in Christ University, Bangalore. Form of industry-Health care Nature of company-private company (ltd) Total investment-1crores Sources of finance-self and part loan His schooling was completed from VDS Jain Higher Secondary School. A rationalist in nature and very dedicative in whatever work is assigned. He is a very particular and organized in all kinds of tasks. He has been very enthusiastic in organizing and managing various programs of team building. His family has been running a very profitable business in the jewels field, which his in good position. However he believes in exploring his area of interest into a profitable business organization and hence firmly strides to become a successful entrepreneur. His strengths being a very good observer and forecaster, he can handle any good or bad situations in a very wise manner. He posses very good Human resource managing abilities and believes every human is an entrepreneur by his thinking and can become successful if he can face all odds and convert those ideas into reality.

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Name-Ritesh Agarwal Age-20 Address-Koramangala, Bangalore Qualification-pursuing BBA in Christ University, Bangalore Form of industry-Health care Nature of company-private company (ltd) Total investment-1crores Sources of finance-self and part loan

He is currently pursuing his under graduation in BBA from Christ University. He completed his schooling from Monovikas English medium school. He is Confident by nature and perfectionist by taste. He believes in exploring his potentials and giving the business world new dimensions of work. He Works with enthusiasm and the right team spirit. He has the desire to convert his knowledge into reality by starting his own business unit. He has also been a keen and an active participant in various reputed fests and programs. He has got a very talented personality of managing events and has been a very a good listener who can take the best of decisions. He also has the ability to encourage his surroundings and create a very influencing arena of vibrations which inspire people to work hard and give the best.

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1.2 Company Profile Mukth has been a dream for the founders, it was essential for a health club/spa to nurture mind, body, and spirit. This combination is hard to come by in Bangalore, and so the two founders decided to create the Mukth health club and sought the backing of two angel investors. Mukth is located in the suburban area of Bangalore in India, and provides a magical setting for this soothing building. It is downtown and in the heart of our target market.

Mukth is a socially and environmentally conscious health club that is concerned not only with physical beauty but also with mental well being. It is a health club with environmental and social concerns that sets it apart from other clubs; all products used are plant safe and cruelty free. We at Mukth feel that pampering our clients' leads to the health and well being of the greater society, therefore, we address the special health concerns of our clients with exercise, yoga, and meditation.

The goals of our company are to be profitable and build a product line through name recognition. It is the immediate goal to launch an additional product line into the beauty

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market, while the long-term goal is to go public with several health club facilities and an active product line.

Keys to Success Create an environment for people to feel good about themselves, both physically and mentally. Provide services for those seeking natural means to strengthen and heal their bodies due to injury or illness. Provide services for the needs of women in shelters and those struggling financially. Provide special activities for various holidays.

Objectives

Our long-range objective is the continuous development of a growing and prosperous business through which both employees and our Company will benefit. Every employee is considered a part of our company team. Our success as a company is founded on the principle of recognition of the skills and the efforts of each employee. Our policy is to work

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with all members of our team in a fair and friendly manner, and treat each team member with dignity and respect. Realizing the importance of job security to all of us, we will work continuously for the benefit of our employees and the company, and to improve the competitive position of our firm, in the service of our present and prospective clients. This will enable us to provide jobs and security for our team members. We will devote our best efforts to the planning of a growing business within, which fosters opportunity for all. To accomplish this, we recognize that our priority is to achieve client satisfaction. Break even by the end of year two. Have an increase in new clients quarterly. Have the company's work in the community covered in the local media. Ability to increase the percentage of profits donated to charities.

Mission The goal of our company is to enhance the lives of men and women by providing an atmosphere that aids the body with relaxation techniques and health conscious alternatives.

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1.3 Industry Profile

Term: small or medium sized company Companies qualifying as small or medium sized enterprises qualify for certain exceptions and exemptions from the usual statutory obligations under the Companies Act. The size, turnover, balance sheet total and number of employees are used to calculate whether the company qualifies as an SME. These are the statutory criterion since 30 January 2004. Prior to that date the criterion for the first two items in each list above was half its present value. When assessing holding companies, the balance sheet, turnover and number of employees of its subsidiaries are taken into account when determining the relevant statistics. Special rules apply to companies qualifying for exemptions, and an audit must prepare. Public companies, companies that are subsidiaries of public companies, Also companies in certain regulated sectors are not capable of qualifying as SMEs. Small companies may deliver abbreviated balance sheet and notes to Companies House and a special auditor's report; and medium sized enterprises must deliver an abbreviated profit and loss account, balance sheet, special auditor's report, a director's report and notes to the accounts. The special auditor's report simply states that the company qualifies for the exemption and that the accounts have been prepared in accordance with the Companies Act. Special rules also apply to SMEs within a group. Companies qualifying as Very Small Companies may qualify for an exemption to file an audit with Companies House. SME is the recognized abbreviation for Small and Medium Sized Enterprises. The majority of the workforce is employed by SMEs. Statistics for 2007 published by the BIS (previously BERR) Small Business Service (SBS) Statistics Unit show that out of 4.7 million businesses in the UK, 99.3% were small firms with fewer than 50 employees, and 0.6% were medium Page | 6

firms with 50-249 employees Despite governments and many of the multinational organizations targeting this group for special financial business support, there is no single definition for a SME either nationally or internationally.

Spa and Wellness industry Definition of Spa Spa - A business for the promotion of health care and wellness. Its main services consist of massage and water applications, but may include steam, sauna, exercise, nutritional therapy and dietary programmers, yoga, meditation, herbal medicine, along with traditional and complementary medicine. Services provided should not come in conflict with any Medical Profession Acts. Women today visit beauty salons not as much to look better as to feel good and have some time for them. They want to pamper themselves and are constantly on the lookout for new experiences.

Healthcare is the new buzzword for corporate and individual businessmen alike, with many corporate setting up private hospitals under their banner. Private healthcare has grown into a formidable industry with an estimated worth of Rs 80,000 crores (CII estimate).

Around 15,000 tourists visited the state of Kerala alone for medical treatment (in 2006). In 2007 more people had traveled to India for critical medical and medi-spa experiences, creating a new trend: medical tourism. Indian private health facilities offer high quality procedures using state-of-the-art equipment managed by internationally trained doctors.

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1.4 About SSI/ MSI, license required

Definition of an Industry

Small scale Industry (SSI)

It is an industry which invests up to Rs 100 lakhs on the plant machinery. The registration of such industry is being done in the State Directorate of Industries.

Medium Scale Industry (MSI)

It is an industry which invests more than Rs 100 lakhs on plant machinery and the total project cost does not exceed Rs 500 lakhs. An Industrial Entrepreneur Memorandum (IEM) is being by the Ministry of Industry, Govt. of India.

Large Scale Industry:

It is an industry which invests more than Rs 100 lakhs on plant machinery and the total project cost exceeds Rs 500 lakhs. An Industrial Entrepreneur Memorandum (IEM) or Industrial License (IL) is being by the Ministry of Industry, Govt. of India.

Procedure and licensing for Starting Small Scale Industries

For starting s Small Scale Industry other than the industries identified as those of highly polluting nature by PPC, entrepreneurs have to first apply to the Directorate of Industries and Commerce, Pondicherry ,Branch office at Karaikal ,sub-office at Mahe and Yanam, depending on the location of the unit for Provisional SSI Registration, in the form prescribed. In case of industries identified as those of highly polluting nature by PPC, entrepreneurs will have to first get clearances from the Pondicherry Pollution Control Committee through the

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Directorate of Industries and Commerce and then approach for provisional SSI registration after its clearance.

All the entrepreneurs irrespective of their size of investment, may approach the `Industrial Guidance Bureau` (Functioning in the District Industries Centre) for getting the requisite clearances expeditiously by filing an Common Application form.

The regional office of the District Industries Centre will make available to the entrepreneurs/ Industrialists, the prescribed application forms for obtaining clearances/permissions from the following Departments (Photocopies and computerized forms in the format required by the concerned Department will also be accepted. Municipality/Commune Panchayat, in whose jurisdiction the industry is proposed to be set up.

Duly filled in Common application forms in prescribed format along with required copies of the site, building & machinery layout plans and other relevant documents shall be submitted to the District Industries Centre or its regional office for obtaining Clearances / Permissions from the various Departments. The District Industries Centre or its regional office on receipt of the applications will forward the same to the concerned Department within three days of the receipt of the applications.

After installing machinery, Entrepreneurs have to get licences from the concerned Municipality/ Commune Panchayat, Licence from Inspectorate of Factories and consent orders from the Department of Environment for operation of the unit.

After commencement of regular production, the entrepreneurs have to apply for Permanent SSI Registration to the Directorate of Industries and Commerce.

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Procedure for Stating Large/ Medium Scale Industries

For starting Large/ Medium Scale Industries, the entrepreneurs have to first apply/ File for Industrial Licence/ Industrial Entrepreneurs Memorandum with the Secretariat for Industrial Assistance in the Ministry of Industry, Government of India. After obtaining the Industrial Licence/ IEM acknowledgment from Government of India, for such Medium & Large scale industries which are not identified as highly polluting, entrepreneurs have to apply to the Directorate of Industries and Commerce for Provisional No objection Certificate for setting up of their unit.

In case of industries identified as those of highly polluting nature by PPCC, entrepreneurs will have to first get NOC from PPCC through the Director of Industries &Commerce and then approach for NOC.

Then the procedures as detailed in paragraphs 1.3 and 1.5 have to be followed. After commencement of regular production, the entrepreneurs have to approach The Directorate of Industries and Commerce for getting commencement of Production .Certificate to avail Sales Tex exemption and other concessions.

1.5 Purpose of selecting

Why Health and Wellness?

The short answer is that the market for targeted nutrients that ensure overall health is exploding. Baby Boomers will soon be cashing their first Social Security checks and experts conservatively estimate that this generation can expect to live a quarter of a century in retirement. As a group, Boomers are more active and health conscious than any previous Page | 10

generation, and want to ensure their health and longevity into their golden years. They have money to spend, and are willing to spend it on high quality nutritional products, anti-aging formulas, and products that will help to keep their aches and pains at bay.

The Right Opportunity Means the Right Products.

When scouting business opportunities, it's crucial to partner with a company that not only will bring you both immediate and residual income, but that also has the kinds of products that will appeal to the burgeoning health and wellness market. Here are categories of products that you should look for:

Mental Performance - As much as we might fear losing our physical mobility as we age, maintaining our clarity of mind is even more important. Nutritional products that help brain functioning and increase blood flow to the central nervous system will remain in high demand.

Anti-Aging - The popularity of home spa treatments is growing tremendously, and shows no signs of slowing. Baby Boomers in particular want to retain their youthful appearance, and have the enthusiasm and means to purchase quality products that help reverse the aging process. Look for a company that offers enzyme peels, eyelift creams, and wrinkle serums.

Women's Health - More than ever before, women are aware that their nutritional needs are different than men's, and that their needs shift as they move from one stage of life to the next. It's wise to partner with a company that has products that speak to the female demographic, particularly since women make the majority of buying decisions for their households.

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CHAPTER 2

2. Feasibility Study After the research conducted on this plan we found out this plan is feasible to meet the market demands as well as the business aim of gaining profit. As we are the first movers bringing in fusion health, personal care and rejuvenation extracting the maximum benefits as well as customer coverage is gained. 2.1 Competitive Analysis/Swot analysis: STRENGTHS First mover advantage Being the first of its kind in Bangalore, we possess an undeniable first mover advantage. Innovation has always been credited for and we believe in setting a benchmark for further innovations. This helps us reach out to our target markets more effectively and help us establish a strong foothold over them.

State of art technology and equipment Several high tech gadgets and technology have been implemented to take care of our customers needs. These gadgets include the nail care machine and skin analysis machine.

Highly skilled professional staff Our nail hair and massage experts have been recruited from the best beauty academies and training institutes like Jawed Habibs institute for hair care and Shehnaz Hussians institute for beauty and health.

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Strong advertisement and sales capability Our methods and techniques of advertising and promotions make a strong impact in the minds of our target market as we have both conventional and unconventional methods of reaching them. Location in prime areas Our spa is located in prime localities such as Indranagar in Bangalore.

WEAKNESSES Acceptance We are initially wary of the acceptance of the brand in a salon and spa segment but with the promotional activities and spread of a good word-of-mouth we expect a good turn of events New brand Since we are a new brand in the market, we do not have the goodwill of an existing brand image. Hence we cannot start with a huge market share.

OPPORTUNITIES

Growing market for this industry Many people nowadays are very health and beauty conscious and have the purchasing power to avail high end services according to their needs and desires. Untapped market The fact that we are a theme based salon and spa that provides more than just beauty treatment can act as an advantage for our business as it would attract more audiences.

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Rise in the standard of living With a rise in the standard of living , more and more people would want to live a luxurious life.

THREATS Technology becoming obsolete Enhancements made on the current technology would serve as a threat and would require upgradation. Competition There are already a number of salons and spas across, which provide high end facilities. Hence these could prove to be a threat to our spa. Further innovators Being innovators ourselves, we cannot ignore the possibility of further innovations that may eat our market share.

Competition

Our indirect competition includes salons, health clubs, and spas in the Suburb area. Because Mukth is a full-service salon, there is no direct competition.

Competitive Edge

Our competitive edge is that we offer a relaxing atmosphere that can refresh the mind, body, and soul. Offering special classes for those with serious health concerns sets us apart, as does the availability of all services under one roof.

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CHALLENGES

Ease of entry into the spa industry- Increasing competition from the medical, hospitality, beauty, and fitness industries

Whether our Spa is a standing-alone one or part of a hospitality structure, the aim is revenue and to transform it into a profit center.

As manager/supervisor or owner, the need to be able to understand P&L Statement and balance sheets

Developing a marketing strategy appropriate to the Spa to attract and retain clientele and to maintain the correct spirit within the team

Focusing on customer satisfaction, bringing client retention and finally leading Smooth operation to enhance client experience and return on investment.

2.2 QUESTIONNAIRE

The questionnaire is prepared based on the mindset of the people knowing how they care their health in the terms of mind, body and soul. Basically the questionnaire contains questions based on how they care of themselves. Thus one can understand from this questionnaire that what type of services they need and according the demand of the people the service will be increased. Thus this questionnaire is distributed among the Men and Women and based on the result of the survey more innovation to the spa could be bought.

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Questionnaire

PERSONAL IMFORMATION

Today's Date:

Name:

Email address:

Gender:

Date of Birth:

Street Address:

City/State of Residence:

Zip Code:

Relationship Status:

Number of Children:

(Please shade any one the answers which suits you) HEALTH

1) In general, my overall health is

O Poor

O fair

O Good

O Excellent

O Very Good

2) Physician Relationship - Do you have a primary care doctor whom you trust and see regularly? O No O Somewhat O Yes

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3) Physician Exam - When was your last physical exam? O More than 5 years O More than 3 years O More than 1 year O Less than 1 year

4) Is your blood pressure within normal range? O Yes O No O Dont Know

5) Is your cholesterol within normal range? O Yes O No O Dont Know

6) Do you take any medications for any of the above or other conditions? O Yes O No

If yes, list here:

7) Do you take any vitamins? O Yes O No

If yes, list here:

8) Do you take any supplements? O Yes O No

If yes, list here:

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9) Do you now use any tobacco products? O Yes O No

10) Have you ever used any tobacco product? O Yes O No

11) Have you had any surgery? O Yes O No

If yes, list here:

12) Do you have any allergies? O Yes O No

If yes, list here:

13) Are you pregnant? (Only Female to be answered) O Yes O No

14) Do you do birth control? O Yes O No

15) Are you diabetic? O Yes O No

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16) Do you have back pain? O Yes O No

17) You have any cardiovascular or heart problems O Yes O No

18) Are there any other matters related to your health that you would like to share, or that you would like to change or improve? O Yes O No

If yes, describe here:

19) Are there any matters related to your family health history that you would like to share O Yes O No

If yes, describe here:

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2.3, 2.4 Data Analysis and Interpretation

People like to look and feel their best. The market for estheticians and hair stylists has always been strong, but it has risen to a new level in recent years with a profound shift toward more holistic health and beauty approaches. Beyond just a haircut and a quick facial, more women and men are looking for a time-out, an escape and an opportunity to pamper them.

The salon, spa and beauty industries have become an antidote to the fast-paced lifestyles of the information age. Formerly alternative health treatments, like massage therapy and acupuncture, are enjoying mainstream success. And with salons and spas for almost every budget, the self-care trend is not limited to the super-rich. Ordinary people are getting manipedis on their lunch breaks and detoxification body wraps at their local day spas.

All this translates into tremendous growth for salons and spas. From the survey conducted spa industry is booming like never before, making today a great time to join the industry.

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CHAPTER 3

3. MARKETING 3.1 THE 4Ps MARKETING MIX 1. PRODUCT Mukth is a one stop destination for you to rejuvenate and recreate yourself. We have a wide variety of services which include hair care, skin care, nail care, body care and make up. Hair Care Our hair care services give you the hair style that you always wanted. We give you a chance to see yourself with your new hair style before you even get it, through our specialized customization software, which enables you to choose the perfect cut from about 40 different styles. 1) Haircuts Apart from the customized hairstyles, we also provide you with the latest trends and styles from across the world. Our hair specialists are trained in these styles and can give you the look that you have always wanted.

2) Hair extensions Our variety of extensions include natural hair extensions, polycarbonate Hair extensions and radium hair extensions in all colors. The radium hair extensions which are made from special polycarbonate material and glow in the dark radium metal are also available in a variety of colors ranging from which are perfect for that Saturday night out as they glow in the dark and make you stand out!!!!

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3) Hair gel Introducing for the first time, a gel that can change the color of your hair streaks according to the occasion. The ingredients contain a secret chemical that helps you chose from a variety of colors ranging from burgundy to blonde. We give you the option of either availing this service at our salon or buying the gel from our boutique. We also provide services like smoothening, straightening, curling, crimping, streaking, coloring, shampoo and conditioning, hair spa etc. 4) Skin Shine-Our exclusive skin analysis machine suggests the perfect treatment suited to your skin type. Depending on your skin texture and problems we help you chose from a variety of facials likeHerbal, Ayurvedic, Naturopathy

Body care One of our most attractive features is our complete range of body care services in a unique and stylish environment that will remind you of the beaches in Goa. The massages are done in the cabanas on the beach and provide you with the perfect blend of privacy and comfort. 1) Swedish Massage Therapy

This is the most common type of massage therapy in the United States. It is also known as Swedish massage or simply massages therapy. Massage therapists use long smooth strokes, kneading, and circular movements on superficial layers of muscle using massage lotion or oil. Swedish massage therapy can be very gentle and relaxing. If you've never had massage before, this is a good one to try first.

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2) Aromatherapy Massage

Aromatherapy massage is massage therapy with the addition of one or more scented plant oils called essential oils to address specific needs. The massage therapist can select oils that are relaxing, energizing, stress-reducing, and balancing, etc. One of the most common essential oils used in aromatherapy massage is lavender. Aromatherapy massage is particularly suited to stress-related conditions or conditions with an emotional component.

3) Hot Stone Massage

Heated, smooth stones are placed on certain points on the body to warm and loosen tight muscles and balance energy centers in the body. The massage therapist may also hold stones and apply gentle pressure with them. The warmth is comforting. Hot stone massage is good for people who have muscle tension but prefer lighter massage.

4) Deep Tissue Massage

Deep tissue massage targets the deeper layers of muscle and connective tissue. The massage therapist uses slower strokes or friction techniques across the grain of the muscle. Deep tissue massage is used for chronically tight or painful muscles, repetitive strain, postural problems, or recovery from injury. People often feel sore for one to two days after deep tissue massage.

5) Shiatsu

Shiatsu is a form of Japanese bodywork that uses localized finger pressure in a rhythmic sequence on acupuncture meridians. Each point is held for two to eight seconds to improve the flow of energy and help the body regain balance. People are normally pleasantly surprised

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when they try shiatsu for the first time. It is relaxing yet the pressure is firm, and there is usually no soreness afterwards.

Fish Spa

An upcoming therapy for foot massages is the fish spa. The fish in tanks eat away the dead cells and help new skin grow on your feet for more healthy feeling feet!!The spa has three tanks; at a time, three persons can have their feet cleaned at a tank. But before you can dip your feet into the water, they are cleaned with soap and rubbed with specially formulated enzymes to neutralize any lotion or ointment residues.

Mukth Boutique Mukth also believes in giving opportunity to budding fashion designers to exhibit their talent in our boutique which encompasses various designer clothing giving a perfect treat to one self after getting rejunuvating by our spa services. This boutique provides a very good platform to young designers to showcase their expertise in the field helping them launch their brands in future as most of our customers are the niche crowd.

Caf As you get that relaxing massage or that unique hairdo, you can quench your thirst and satisfy your hunger by enjoying one of the many refreshing mock-tails and snacks.

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Play Area Wondering what to do with your little ones while you rejuvenate your body, mind and soul? Dont worry! Let them enjoy themselves at our little play pen tiny tots where all their needs will be taken care of by our in house nanny.

2. PRICE SERVICE 1.HAIR CARE A. Hair cuts Customized/expert suggestions/latest trends and world styles 300-1100 DESCRIPTION PRICE(in Rupees)

B. Extensions

Normal Radium

550 690 2500 3000 2000 3500-4500 4000-9500

C. Hair gel

Changes color Treatment Purchase(serum and colors)

D. Straightening E. Smoothening

Price depends on length Smooth silky hair-price

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depends on length F. Curling Permanent Temporary G. Crimping H. Streaking For parties and weddings For those trendy colorsdepends on hair length I. Coloring J. Hair spa Depends on hair length Total nourishment for your hair 2.SKIN SHINE A. Skin analysis To know what your skin truly 850 needs B. Facials Herbal , Ayurvedic and naturopathy 3. NAIL CARE A. Manicure Our machine provides you with a world class manicure B. Nail extensions C. Nail art and piercings For those long talons Fancy nails! 3500 2500-4500 2000 1000-2000 3500-8800 1800 4900 1500 4000 2500-6500

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4. MAKE UP A. Bridal package B. Party package For the prettiest bride ever! The perfect make up and hairdo for that perfect party! 5. BODY CARE A. Massage Aromatherapy , pregnancy massage , hot stone massage , deep tissue etc. B. Fish spa A cleansing massage for 15 minutes C. Waxing and threading 6. CAF Mock tails Snacks Refreshing drinks! Grab a quick bite! 500-1000 250-550 100-1200 650 3500-10000 7900 2900-6900

3. PLACE The initial establishment of the Mukth will be in India Bangalore. In Bangalore it is situated in Indranagar on the 100 ft road. This area was selected as the surroundings provide very potential consumer base that are quite flexible who are willing to accept such services and the

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neighboring areas are surrounded by many business parks which has another advantage in building our consumer base.

4. PROMOTION NEWSPAPERS We plan to advertise in national newspapers like The Times of India (Bangalore times) BILLBOARDS We intend to advertise on billboards and hoardings in the posh localities like Cunningham road and Lavelle road in Bangalore. Advertisements on billboards would be electronic and similar to videos. This will attract the attention of numerous people and have a wider appeal. MAGAZINES We would take up the task of publicizing our service through magazines like Cosmopolitan, Elle and Famine. This would help most of the people interested in the latest happenings around them to know about the utility of our services. BROCHURES AND CATALOGUES Brochures with the details about our spa and salon and the services offered will also be launched and circulated throughout the two metros. This will give the prospective customers a more detailed view of what exactly we offer. TIE UPS We also have tie ups with yoga centers and some high end boutiques to promote our service as these places are often frequented by our target market. In Bangalore we have tie-ups with The Collective, Asian Spa the Villa, YLG and Golds Gym. Page | 28

WEBSITE We have a website for our net savvy clients. www.moksha2experience.com BRAND AMBASSADOR Mukth will have a known and reputed Indian model for the video shoots.

3.2 Advertisement copy-print aids

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3.3 STP SEGMENTATION Market Segmentation is undertaken in order to focus on the subset of the prospects that are most likely to purchase our offering. This will in turn help us get the best returns from our marketing and service expenditures. Based on the need our service satisfies, the market is segmented into diverse sections. They are:

DEMOGRAPHIC SEGMENTATION: These include factors like Age, Income levels, Education and Occupations which purely relate the various population related characteristics the masses possess.

PSYCHOGRAPHIC SEGMENTATION: These include the lifestyle, personality and attitudes of the individuals. Many of them are very influenced by Brand Image which serves as a great advantage for the service. Mukth would attract people who believe in living the healthy yet stylish life.

BEHAVIORAL SEGMENTATION: It is based on benefits sought in the service, usage rate of the service and status that they enjoy due to their specific income levels. The benefits that the consumers derive from the service as well as the prospects preferences determine the acceptance and complete incorporation of the service.

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GEOGRAPHICAL SEGMENTATION: This takes into consideration the region to which the consumer belongs to. The prevalent atmosphere and practices of the population will determine the acceptance of the service to a large extent.

TARGETING Targeting the right customers is one of the most important criteria that needs to be looked at in order to create a potential customer market .The major sectors that we would be targeting are: Upper and upper-middle income groups: We are targeting this range of income groups as we are launching the service initially for the high end customers to create a niche and an elite brand name for itself. Youth and higher age groups: We are targeting this particular segment of age groups as we believe that its not only in the higher age segment lies our market but in the youth who according to recent findings have a very high expenditure on beauty and health care products and services which constitute a great proportion of the service industry and there lies our greatest potential. Population in Bangalore and Mumbai: We are targeting at the population segments in the city having high purchasing power, Bangalore being the silicon valley of India.

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Men and Women: We are targeting the entire population based on gender to capture the greatest market share especially that of the women.

POSITIONING We would like to position Mukth as a unique beauty and health care experience where there is a perfect blend of nature and technology that caters to the individual needs and desires of each and every customer. Being first of its kind in Bangalore, the cosmopolitan of growing trends, we would like to add a brand new dimension and give a completely new angle to beauty and health care in the current city scenario. We wish to establish ourselves as the first priority in the list of the other service providers by the elite and upper middle class groups.

USP Mukth salon and spa, a one stop destination for all your beauty and health care needs and desires in an enriched ambience that gives you the magical feel of sun , sand and surf that helps you recreate and rejuvenate you body mind and soul. Come live the experience

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CHAPTER 4 4. Human Resources Organization Chart

Owners- Rahul M and Ritesh Agarwal

General Manager

Spa cordinator

Team Head

Equipment Manager

Employees

Management Summary Mukths location in Bangalore will be staffed according to department. The salon will have two full-time stylists and the spa with be staffed with a full-time beauty technician and masseur. The health department will have three part-time instructors working on rotating shifts.

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Management will have four managers, each with specific areas of expertise: financials, publicity, human resources, and ongoing development.

4.1 Organizational Structure

The spa industry over the last 5 years has shown tremendous growth, not only in the number of spas, but also in the diversity of spas and spa therapies available. This growth has resulted in the necessity to define and unite the spa industry, and ensure a consistent quality spa experience for the spa visitor. They are various opportunities available as employee in the Spa & Wellness Industry. Spa owners are constantly looking for one unique post called spa manager to run their set up successfully.

Individuals with specialized training and education in Spa Management can expect a variety of career options and levels of leadership available to them in the industry, either directly working in a spa or working for an industry vendor or support service company. At a time spa manager post is labeled with different name as a assistant Team Leader, spa Coordinator and assistant General Manager

4.2 Following aspects of spa Therapy Knowledge Base is also very important.

Working knowledge of benefits and protocols of Spa therapies Support continuing education for staff Working knowledge of treatments and how they should be performed Possess product knowledge

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 Coordinate training in regards to retail goals Implement training programs in regards to customer service Knowledgeable on other Spa services including exercise, physical fitness, Spa cuisine, nutrition, salon services and lifestyle skills Oversee and coordinate training of treatment protocols on menu.

4.3, 4.4 Work hours and conditions: Mukth is open 7 days a week. Management must approve any changes of the work schedule. Each employee will receive a 10 minute rest period for every 4 hours worked. Employees scheduled to work an 8 hour shift will get a 30-minute lunch break at approximately half way through their shift (Depending on number of team members on the shift). You are required to stay on the premises during breaks. You do not need to clock out for breaks as your schedule includes paid break times.

4.5 Punctuality and Leave policy A leave of absence shall be granted in cases of sickness, and may be granted for other purposes at the discretion of management. Whether or not service and benefits will

accumulate during a leave of absence will be determined by management. To be valid, a leave of absence must be confirmed in writing. An employee who has been granted a leave of absence of indefinite duration shall give a one-week written notice of intent to return to work, and Mukth shall be under no obligation to re-employ him/her until circumstances allow it.

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4.6 Loan grants policy: Mukth has a firm policy of not granting loans to employees unless the situation is proved to be valid. 4.7 Monetary incentives: All qualified employees are paid a 5% commission on all full size bottles of lotion that meets seasonal minimum requirements. Commissions will be paid once a month by the 5 th of the month for the previous month. 4.8 Recruitment policy: We plan our recruitment process to acquire the best of personnels who can perform a given task diligently. We utilize walk-ins, referrals, campus and data bank technique for recruiting process. Any vacancies will be filled by the existing employees. 4.9 Salary structure and Fringe benefits Your performance is continually evaluated by your supervisor and periodically (not less than once every 12 months) you are considered for a change in your pay rate. Whether or not you receive a pay increase is affected by such items as; quantity and quality of work, sales performance, self-improvement, and increased value on the job, general attitude, attendance and loyalty. Individual salaries and wages for each employee are established by mutual agreement between the employee and management. You do not discuss with others what your pay scale is. Adjustments, increases and other factors that have an effect on the employees

compensation are matters for discussion between the employee and management on a private and individual basis. Management will review and discuss with each employee, salary and

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wages on a prearranged schedule. Fringe benefits include allowances- food and travelling, non monetary benefits, club membership.

4.10 Personnel Plan

The Personnel Plan follows. Details are in the appendix.

Personnel Plan

Year 1 Management Salon Spa Health Other Total People Total payroll 12000000 1536000 1536000 1728000 0 21 16800000 13750000 1550000 1550000 1750000 0 21 18600000

Year 2 16250000 1600000 1600000 1800000 0 21 21250000

Year 3

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CHAPTER 5

5. Finance Financial Plan

The plan for Mukth financial future is steady growth. With a foundation of start-up investment from angel investors, Mukth has a solid cash base from which to establish itself and build name recognition. The eventual goal is to go public with a product line and locations around the country. The companies will break-even in the second year.

Leasing the location with the option to purchase the property is ideal for the company. The equipment, including exercise equipment, was purchased with start-up funds, leaving Mukth with little monthly costs beyond rent, utilities, and payroll. Mukth has a small staff of service providers whose payroll is subsidized by tips from clients. The managers are paid modestly, with their pay tied to the success of the company

5.1 Investment Break up

The table that follows details projected starting costs.

start - up
$25,000 $100,000 Expenses Assest $200,000 $150,000 Investment Loans

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Start-up Requirements Start-up Expenses Legal Stationery etc. Brochures Consultants Insurance Rent Research and development Expensed equipment Other Total Start-up Expenses 375000 25000 250000 0 25000 225000 0 125000 225000 1250000

Start-up Assets

Cash Required Start-up Inventory Other Current Assets Long-term Assets Total Assets

15000000 250000 3250000 0 18500000

Total Requirements

19750000

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Start-up Funding Start-up Expenses to Fund Start-up Assets to Fund Total Funding Required 1250000 18500000 19750000

Assets Non-cash Assets from Start-up Cash Requirements from Start-up Additional Cash Raised Cash Balance on Starting Date Total Assets 4000,000 14500000 0 14500000 18500,000

Liabilities and Capital

Liabilities Current Borrowing Long-term Liabilities Accounts Payable (Outstanding Bills) Other Current Liabilities (interest-free) 0 0 25,0000 0

Total Liabilities Capital Planned Investment Investor 1

25,0000

10000,000

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Investor 2 Additional Investment Requirement

10000,000 0

Total Planned Investment Loss at Start-up (Start-up Expenses) Total Capital Total Capital and Liabilities Total Funding

20000,000 (1250000) 2875,0000 18500,000 19750000

5.2 Projected Balance Sheet for three years

The following table shows the projected Balance sheet.

Pro Forma Balance Sheet Assets Year 1 Year 2 Year 3

Current Assets Cash Inventory Other Current Assets Total Current Assets 15601650 75000 3750000 19426650 15793250 124000 3750000 19667250 22585400 163000 3750000 26498400

Long-term Assets Accumulated Depreciation

0 0

0 0

0 0

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Total Long-term Assets Total Assets

0 19426650

0 19667250

0 26498400

Liabilities and Capital

Year 1

Year 2

Year 3

Current Liabilities Accounts Payable Current Borrowing Other Current Liabilities Subtotal Current Liabilities 1254250 0 0 1254250 1337400 0 0 1337400 1607050 0 0 1607050

Long-term Liabilities Total Liabilities

0 1254250

0 1337400

0 1607050

Paid-in Capital Retained Earnings Earnings Total Capital Total Liabilities n Capital Net Worth

30000000 (1250000) (10577650) 18172400 19426650 18172400

30000000 (11827650) 157500 18329900 19667250 18329900

30000000 (11670150) 6561450 24891350 26498400 24891350

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5.3 Projected Profit and Loss A/c

We expect to return increasing profits over the next three years.

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Pro Forma Profit and Loss

Year 1 Sales Direct Cost of Sales Other Total Cost of Sales 21033400 375000 0 37,5000

Year 2 34980000 620000 0 620000

Year 3 47325000 815000 0 815000

Gross Margin Gross Margin %

20658400 98.22%

34360000 98.23%

46510000 98.28%

Expenses Payroll Sales and Marketing and Other Expenses Depreciation Leased Equipment Utilities Insurance Rent Payroll Taxes Other 0 0 2010000 600000 2700000 4200000 0 0 0 2250000 600000 2700000 4650000 0 0 0 2250000 600000 2700000 5312500 0 16800000 4926000 18600000 5350000 21250000 5600000

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Total Operating Expenses

31236000

34150000

37712500

Profit Before Interest and Taxes EBITDA Interest Expense Taxes Incurred

(1077650) (1057650) 0 0

210000 210000 0 52500

8797500 8797500 0 2236050

Net Profit Net Profit/Sales

(10577650) -50.29%

157500 0.45%

6561450 13.86%

5.4 Sales Forecast

The Sales Forecast is in monthly detail in the chart, and the summary follows in the table.

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Sales Forecast Year 1 Unit Sales Salon Exercise/Therapy Spa Other Total Unit Sales 3,275 14,755 2,425 600 21,055 6,500 18,000 3,500 800 28,800 9,000 22,000 4,300 1,000 36,300 Year 2 Year 3

Unit Prices Salon Exercise/Therapy Spa Other 2750.00 2250.00 2250.00 500.00

Year 1 2850.00 450.00 2250.00 600.00

Year 2 3000.00 450.00 2250.00 750.00

Year 3

Sales Salon Exercise/Therapy Spa Other Total Sales 9006250 6270900 5456250 300000 21033400 18525000 8100000 7875000 480000 34980000 27000000 9900000 9675000 750000 47325000

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Direct Unit Costs Salon Exercise/Therapy Spa Other 50.00 0.00 50.00 150.00

Year 1 50.00 0.00 50.00 150.00

Year 2 50.00 0.00 50.00 150.00

Year 3

Direct Cost of Sales

Salon Exercise/Therapy Spa Other Subtotal Direct Cost of Sales

163750 0 121250 90000 37,5000

325000 0 175000 120000 620000

450000 0 215000 150000 815000

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5.5 Break-even Analysis

The Break-even Analysis in this plan makes many assumptions to achieve an estimate. Almost all cost in the operations will remain fixed. Salary for employees, lease, and utility costs are all considered as fixed costs.

Break-even Analysis Monthly Units Break-even Monthly Revenue Break-even Assumptions: Average Per-Unit Revenue Avg Per-Unit Variable Cost Estimated Monthly Fixed Cost 999 18 2603000 2,653 2650250

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5.6 Important Assumptions

The main assumptions are the continued market need and the ability to deliver. We have included financial assumptions below.

General Assumptions Year 1 Plan Month Current Interest Rate Long-term Interest Rate Tax Rate 1 8.00% 7.25% 25.42% 2 8.00% 7.25% 25.00% Year 2 3 8.00% 7.25% 25.42% Year 3

5.7 Key Financial Indicators

Key to the financial success of Mukth is continued annual growth. While there are times of the year, especially holidays, where sales are expected to raise substantially, annual growth is imperative. The direct costs of providing our services is small, so increasing the number of clients receiving services will aid the bottom line. The inventory turnover increase shown in the chart is the result of rounding; our inventory remains steady at approximately two months in stock.

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5.8Projected Cash Flow

The following chart and table show the cash flow for Mukth.

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Pro Forma Cash Flow Cash Received Year 1 Year 2 Year 3

Cash from Operations Cash Sales Subtotal Cash from Operations 21033400 21033400 34980000 34980000 47325000 47325000

Additional Cash Received Sales Tax, VAT, HST/GST Received New Current Borrowing New Other Liabilities (interest-free) New Long-term Liabilities Sales of Other Current Assets Sales of Long-term Assets New Investment Received Subtotal Cash Received EXPENDETURES 0 0 0 0 0 0 0 21033400 YEAR 1 0 0 0 0 0 0 0 34980000 YEAR 2 0 0 0 0 0 0 0 47325000 YEAR 3

Expenditures from Operations Cash Spending Bill Payments Subtotal Spent on Operations 16800000 13631750 30431750 18600000 16188350 34788350 21250000 19282850 40532850

Additional Cash Spent

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Sales Tax, VAT, HST/GST Paid Out

0 0 0 0 0 0 0 34788350

0 0 0 0 0 0 0 40532850

Principal Repayment of Current Borrowing 0 Other Liabilities Principal Repayment Long-term Liabilities Principal Repayment Purchase Other Current Assets Purchase Long-term Assets Dividends Subtotal Cash Spent 0 0 0 0 0 30431750

Net Cash Flow Cash Balance

(9398400) 15601650

191650 15793250

6792150 22585400

5.9 Business Ratios

Industry profile ratios based on the Standard Industrial Classification (SIC) code 7991, Physical Fitness Facilities, are shown for comparison.

Ratio Analysis Year 1 Year 2 Year 3 Industry Profile Sales Growth Percent of Total Assets Inventory Other Current Assets 0.39% 19.30% 0.63% 19.07% 0.62% 14.15% 3.60% 31.10% 0.00% 66.31% 35.29% 15.90%

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Total Current Assets Long-term Assets Total Assets

100.00% 0.00% 100.00%

100.00% 0.00% 100.00%

100.00% 0.00% 100.00%

39.00% 61.00% 100.00%

Current Liabilities Long-term Liabilities Total Liabilities Net Worth

6.46% 0.00% 6.46% 93.54%

6.80% 0.00% 6.80% 93.20%

6.06% 0.00% 6.06% 93.94%

34.80% 27.60% 62.40% 37.60%

Percent of Sales Sales Gross Margin Selling, General & Administrative Expenses Advertising Expenses Profit Before Interest and Taxes 18.54% -50.29% 11.44% 0.60% 8.45% 18.59% 2.40% 2.70% 100.00% 98.22% 148.51% 100.00% 98.23% 97.78% 100.00% 98.28% 84.34% 100.00% 0.00% 73.20%

Main Ratios Current Quick Total Debt to Total Assets Pre-tax Return on Net Worth Pre-tax Return on Assets 15.49 15.43 6.46% -58.21% -54.45% 14.71 14.61 6.80% 1.15% 1.07% 16.49 16.39 6.06% 35.34% 33.20% 1.10 0.73 62.40% 3.00% 7.90%

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Additional Ratios Net Profit Margin Return on Equity

Year 1 -50.29% -58.21%

Year 2 0.45% 0.86%

Year 3 13.86% 26.36% n.a n.a

Activity Ratios Inventory Turnover Accounts Payable Turnover Payment Days Total Asset Turnover 3.53 11.67 28 1.08 6.23 12.17 29 1.78 5.68 12.17 27 1.79 n.a n.a n.a n.a

Debt Ratios Debt to Net Worth Current Liability 0.07 1.00 0.07 1.00 0.06 1.00 n.a n.a

Liquidity Ratios Net Working Capital Interest Coverage $363,448 0.00 $366,598 0.00 $497,827 0.00 n.a n.a

Additional Ratios Assets to Sales Current Debt/Total Assets Acid Test Sales/Net Worth Dividend Payout 0.92 6% 15.43 1.16 0.00 0.56 7% 14.61 1.91 0.00 0.56 6% 16.39 1.90 0.00 n.a n.a n.a n.a n.a

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CHAPTER 6 Production and Operation 6.1 Location Analysis The initial establishment of the Mukth will be in India Bangalore. In Bangalore it is situated in Indranagar on the 100 ft road. This area was selected as the surroundings provide very potential consumer base that are quite flexible who are willing to accept such services and the neighboring areas are surrounded by many business parks which has another advantage in building our consumer base.

6.2 Layout design

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6.3 Process Flow Chart

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CHAPTER 7 Conclusion CONCLUSION This project has indeed helped us to apply the fundamentals of starting a new business venture and also made us aware of all the odds and difficulties which an entrepreneur endeavors in starting a new business. Our business plan, a fusion of spa, personal care and health care was a dream project and this course provided a platform for us to develop our plan in a detailed and systematic structure. We learnt the various aspects to be kept in mind while drafting a business plan and followed a prescribed pattern of format to develop it. This project was a detailed research done on the idea and we tested the feasibility in terms of the finance, human resource, and market demand, consumer preferences. After the study we realized there is a positive potential for this business and we came up with many first moving initiatives to make our business creatively different compared to the typical ones. However, in the process we realized the importance of research and development to make a plan a practical execution which will satisfy all the business demands with fulfilling all the consumer expectations.

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Bibliography Web sites: www.google.com www.scribd.com

Magazines: Feminine Health and fitness

Field research: We also did a field study concerning three major spas in the city namely the Ayush, Nature and Cure and Golden Palms. We consulted Mrs.Sunanda, a professional spa coordinator who gave us her valuable insights about the industry, thus helping us in the proceedings of our plan.

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