Business plan: A Business Plan of Swagat Pvt. Ltd.
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Transcript of Business plan: A Business Plan of Swagat Pvt. Ltd.
Assignment
Of
Entrepreneurship
Actual Business Plan of
Swagat Pvt. Ltd.
An Online Business Organization
Registered Domain: www.swagat.com.np/byproducts
Based On Specimen of Actual Business Plan of Bhairav-Kumari Trading
Limited
BBA 6th Semester, SAMB
By: Rohan Byanjankar
Sainik Awasiya Mahavidyalaya
Sallaghari, Bhaktapur
1. Executive summary
Swagat Pvt. Ltd. is a newly established company that offers variety of products to the customer
through online medium and operates under a domain www.swagat.com.np/byproducts. The
company has an aim to promote ecommerce in Nepal and to flourish the concept of ecommerce
all over Nepal.
The newly established company is in the process of registration. However, the website has been
registered under Mercantile Pvt. Ltd., which is one of the reputed Information Technology
Company of Nepal. This company evolved from a partnership of its founders. The co-founder of
the company are Mr. Swagat Panta, Mr. Divya Jyoti Pokhrel and Mr. Rohan Byanjankar. Mr.
Swagat Panta holds Master’s Degree in IT, and he is a Java Instructor by profession. Mr. Divya
Jyoti Pokhrel holds Bachelor’s Degree in IT (BSCSCIT).
The founders have equity in the ratio 2:1:2, total 20 percent of the share valued Rs. 27000. The
primary objective of the company is to integrate the true essence of Ecommerce in Nepalese online
business practices. The true Essence of Ecommerce refers to the process of buying and selling of
products through online medium backed by online payment of products. In contrary, cash on
delivery is prevalent in Nepalese online market, which is not the true essence of ecommerce.
1.1. Product Summary
Ecommerce is flourishing in Nepal. The growing online commerce in neighboring nations India
and China propelled Nepalese business houses to go online. Online business is gearing up in
Nepal, but has not been able to grasp the true essence of ecommerce and settle in the mind of
customers. Customer have strongly deep-rooted distrust towards online stores due to poor delivery
of low quality products often by beguiling the customers and reluctance in providing after sale
services has obscured customers faith. Thus, the systematization of online business process and
clear integration of all the necessary elements of e-commerce website can improve the quality of
after sale service we deliver and helps in maintaining an optimum quality level of products, which
acts as a catalyst in gaining confidence and trust of customers towards our online store.
1.2. Market Characteristics
Ecommerce is quite new concept in Nepal. People in Nepal are not so familiar with online
transactions and do not believe online purchase of products as safe, reliable and trustworthy. The
growing online business in western countries primarily in the United States; and burgeoning
online transaction in India and China have captivated Nepalese customers to purchase online.
Thus, it is evident that potential for online store in Nepal is obviously great.
The company has focused on business to customer model of ecommerce. The online store focuses
on retail sales rather than bulk wholesale sales. The online store basically target youth generation
and intends to exclusively offer two products: electronics products and paper as well as e-books.
These products calls for adequate description and customers can easily get through the product
details through images and videos and requires less physical touch to make choices such as
clothes, shoes and so on.
2. Product Characteristics
Ecommerce is growing in Nepal but not in fast pace. People are substituting offline purchase of
products to online purchase of products. The online commerce in India is growing in the fastest
pace superseding rest of the nations of the world. So, Nepalese customers are also propelled
towards online purchase of products and eager to have huge shop in their hand. Basically, youth
are inclined towards online purchase and most of the online purchases are made by youth. Thus,
we have intended to offer two products: electronic products and paper as well as e-books, which
is demanded most often by youth.
3. Market Expectation
The company’s management envision the great prospect of online business in Nepal. The
company has focused on youth market segment and intended to offer electronic products and
eBooks. The traffic rate is expected to be much higher and conversion rate can be increased
through promotion in social media. Some of the features of market of our company are:
1. Our market consist of youth buyers.
2. The potential of each product is extremely high.
3. The demand forecast for Electronic products are prospectively high.
4. We have price comparison data, which we gathered from info-mediaries.
According to Internet Retailer, the conversion rate of electronic products and eBooks are high.
About 80 percent of visitors who seek for electronic products purchase the product online.
4. Strategic marketing Plan
The company has a very simple marketing strategy to identify primary niches for online
electronics customers and to create a network of competent distributors to service these niches.
4.1. Objective
There are ample of online store in Nepal. They are equally competent and also uses various
different info-mediaries to gather market information, compare prices, and products. Ecommerce
is quite new concept in Nepal, so the company that excels on providing better services and quality
products will be the market leader and a behemoth in the realm of Nepalese online business. Our
distinctive competency of having knowledge about competitors, market trend, and youth demand
gives us a daunting position and unique market strength. Consequently, one of the most important
objectives of our company is to be “The Brand of Customers”.
4.2. Pricing
The online business is quite new in Nepalese market. Customers prefer offline purchase of goods
instead of online purchase as customers perceive that online purchase is unsecure and think that
online businesses charge high prices. Thus, to enter in the market and capture significant market
share, penetrating pricing strategy is better. Moreover, we will maintain close intimacy with
marketing agencies and different info-mediaries. Our aim is to be The Brand of Customers, so in
initial stage we will provide free delivery of product but, orders must exceed five hundred rupees.
In addition, the customer who makes purchases of Rs. 20000 or more for ten times will be our
special customer and will get 2 percent discount on every purchases he/she make from 11th times.
4.3. Promotion
Promotion is the most important aspect of marketing strategy. According to research, the
advertisement that can makes viewer engage on it for seven seconds or more can turn him or her
into potential customer. Moreover, the research by Sophify, Facebook has a conversion rate of
1.85% while the conversion rate of Twitter stands at 0.77%. Thus, it’s important to promote in
Facebook and a Facebook business page will be created that can directly link customers to our
ecommerce website. Moreover, Google Ad Words are also key marketing tools in the internet that
transmits the advertisement in almost every Google products, which is just analogous to the
advertisement all over the internet. Thus, we will advertisement through Google Ad Words. There
are some of the established virtual stores in Nepal, we will maintain a virtual store on those
established store for promotion of our online store.
Some of the major promotion strategies adopted by online store are as follows:
1. Advertisement of our online store through Google Ad Words.
2. Facebook is the social networking powerhouse that connects millions of people. We will
create a Facebook business that can directly link customers to our ecommerce website.
3. We will also establish virtual store in established online stores.
4. We will maintain an email list that helps us to deliver information, products, and content into
customer’s personal mailboxes.
5. Organization
Swagat Pvt. Ltd. is the company formally started on 1st January, 2017. The corporate office is in
New Baneshwor (North of BICC), Kathmandu, Nepal. The key people of the Swagat Pvt. Ltd. are
Mr. Swagat Panta, Mr. Rohan Byanjankar and Mr. Divya Jyoti Pokhrel.
The founders of Swagat Pvt. Ltd. are also equally engaged in other fields too. The three people
are from different background and work in different companies.
Mr. Swagat Panta
Mr. Swagat Panta is one of the founding members of Swagat Pvt. Ltd. and he also works as a java
instructor in Super Brain, one of the reputed IT consultant that is the IT solution for different
corporate houses. He also works in Mercantile as part time employee.
Mr. Divya Jyoti Pokhrel
Mr. Divya Jyoti Pokhrel is the founding member of our company and is the fresh Bachelor’s
graduate. He did BSCCSIT from St. Xavier’s College, Maitighar, Kathmandu. He holds complete
knowledge on Website Designing, Java Programming, and Android Application Development.
Mr. Rohan Byanjankar
Mr. Rohan Byanjankar is the founder member of our company and is currently studying BBA
sixth semester at Sainik Awasiya Mahavidyalaya. He has a good educational background and is
also eager in programming. He attained Java classes in Super Brain, the IT consultant which is
located at New Baneshwor, Kathmandu.
6. SWOT analysis
SWOT analysis refers to the minute scanning of environment to extract information regarding
Strengths, Weaknesses, Opportunities, and Threats of the business organization. The Strength and
Weaknesses within us, and the opportunities we can grab and threat we can pose has been
discussed in the table below:
Environment Outcome
Internal
Strengths
1. We have more information about
market that we obtain for info-
mediaries.
2. The product we have intended to
focus on are mostly demanded by
youth.
3. Our target market is youth and
youths are the prime customers of
ecommerce.
Weaknesses
1. We are new to market so we have less
brand recognition.
2. Our core focus is on only two
products, which is very narrow in
scope.
3. We are new, so the grip of intimacy
with our marketing agencies is not so
tenacious.
External
Opportunities
1. Online business in Nepal is just in
Starting phase or first stage of
ecommerce, so we can better
penetrate into market more easily
now than in future.
2. We have focuses in Fast Moving
Consumer Goods (FMCG) such as
Electronics and eBooks that
generally lures youth, who are the
Threats
1. Information technology in Nepal is
not well developed, so we must
struggle to maintain our online
business to run smoothly.
2. Online payment system and
economic policies are not in
congruous to the online business and
IT policy has not be intensively
focused on flourish of ecommerce
intended customers of all Nepalese
online stores.
3. Most online business are not trusted
by customer as they provide poor
after sale service and deliver poor
quality products. Its prime
opportunity to gain customers
attention and be customer’s brand by
maintaining high quality after sale
service and quality products.
rather focused on extension of
banking system.
3. Many online businesses are
proliferating day by day, amongst
them ample of are bogus and intended
to beguile customers. This fraudulent
act will create negativity in customers
towards the online business leaving
severe threat to other genuine online
business.
Online business in Nepal is just in initial stage of ecommerce, so we can better penetrate into
market more easily now than in future. We have focuses in Fast Moving Consumer Goods
(FMCG) that generally have lower inventory cost and have intensively focused in electronics and
eBooks which is basically preferred by youth, who are the intended customers of all Nepalese
online stores. Moreover, most online business are not trusted by customer as they provide poor
after sale service and deliver poor quality products charging higher prices. Its prime opportunity
to gain customers attention and be customer’s brand by maintaining high quality after sale service
and quality products.
7. Financial Summary
Swagat Pvt. Ltd. is the online business company, so it does not require huge investment in
infrastructure development and outer decoration. The company has focused more on website
designing and content management.
However, with the onset of startup period, firm will have to make substantial expenses that
incudes inventory, market research, staff compensation and salary, promotional activities, legal,
accounting, and tax fees.
There are several set of pro forma financial statements that includes income statement, cash flow
statement, and comparative balance sheet.
APPENDIX A
Pro forma Income Statement
Description Amount
2017 2018 2019
1 Gross Sales 800000 1100000 1500000
2 Net Sales 800000 1100000 1500000
3 Gross Profit 800000 1100000 1500000
4 Total Operating Expenses 500000 650000 1100000
5 Depreciation and non-cash expenses 65000 65000 100000
5 Operating Income/Loss 235000 385000 300000
6 Other Income 50000 50000 50000
7 Other Expenses 100000 100000 100000
8 Profit Before Tax 185000 335000 250000
9 Tax 37000 67000 50000
10 Net Income 148000 268000 200000
Total operating expenses includes all the operating expenses such as salary, commission, rent,
shipping, promotional expenses, and other expenses including Depreciation.
APPENDIX B
Pro Forma Cash Flow Statement
Description Amount
2017 2018 2019
1 Total Cash Receipt 850000 1170000 1590000
2 Total cash Disbursement 600000 750000 1200000
3 Net Cash Flow 250000 420000 390000
4 Opening Cash Balance - - -
5 Loan - - -
6 Closing Cash Balance - - -
Total operating expenses includes all the operating expenses such as salary, commission, rent,
shipping, promotional expenses, and other expenses excluding Depreciation and other non-cash
expenses.
APPENDIX C
Pro forma Balance Sheet of first three years (2017, 2018, 2019)
Particular Dec. 2017 Dec. 2018 Dec. 2019
Current Assets
Cash 250000 420000 390000
Prepaid Expenses 56000 56000 34000
Inventory 94000 140000 105000
Total Fixed Assets
Computer 400000 400000 600000
Furniture 100000 100000 200000
Less: Accumulated Depreciation (65000) (65000) (100000)
Miscellaneous Expenses
Preliminary Expenses 10000 0 0
Total Assets 845000 1051000 1229000
Current Liabilities
Bills Payable 56000 40000 30000
Salary Payable 130000 120000 100000
Tax payable 0 10000 5000
Commission Payable 74000 13000 34000
Long Term Debts 300000 120000 240000
Owner's equity 30000 90000 200000
Common Stock 105000 400000 440000
Retained Earning 150000 258000 180000
Total Liabilities 845000 1051000 1229000