ePharma Final

7/31/2019 ePharma Final

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ePharma

Online Business Plan

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E-BusinessAssignment:ONLI NE BUSI NESS PLAN

Organization Selected:

ePharma

Prepared for:

Prof. Jahanzaib Ismat MalhiInstitute of Business Administration

University of the Punjab, Lahore

Prepared by:

Faisal Manzoor Bajwa MBAE2010-089Usman Rashid Dar MBAE2010-146

MBA (Executive)

I nstitute of Business Administrat ionUniversity of the Punjab, Lahore

May 02, 2012


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ePharmawww.epharma.com.pk


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TABLE OF CONTENTS

EXECUTI VE SUMMARY............. ................... .................... .................. ............... 4

COMPANY OBJECTI VES.................................. .................... .................. ............ 5Goals & Objectives................................................................................................ 5

Vision / Mission Statement..................................................................................... 6Keys to Success ................................................................................................... 6Risk Factors.......................................................................................................... 6Company Summary 7Opportunities. 7

DESCRI PTI ON OF PRODUCTS & SERVI CES................. .................. ................... 8Products & Services............................................................................................... 8

Future Plans......................................................................................................... 9Product Fulfillment................................................................................................. 9

MANAGEMENT & ORGANI ZATI ON..................... ................... ................... ........ 10Management Team............................................................................................................................ 10Organizational Structure ........................................................................................ 10Personnel Plan....................................................................................................... 10

FI NANCI AL PLAN........................... ....................... ................ ...................... ...... 11

6.1 Important Assumptions .................................................................................... 11

6.2 Sales Forecast.................................................................................................. 116.3 Capital Requirements ....................................................................................... 126.4 Break-Even Analysis.......................................................................................... 126.5 Exit / Repayment Strategy................................................................................. 126.6 Projected Profit and Loss .................................................................................. 126.7 Projected Cash Flow.......................................................................................... 136.8 Projected Balance Sheet..................................................................................... 136.9 Business Ratios ................................................................................................ 13

MARKET ANALYSI S & MARKETI NG PLAN.......................... .................. ............. 13Industry Analysis................................................................................................... 13

Target Market....................................................................................................... 13

Competitors.......................................................................................................... 13Competitive Edge ................................................................................................. 14Marketing Objectives............................................................................................. 14Marketing Strategy................................................................................................ 14Pricing Strategy..................................................................................................... 14


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EXECUTI VE SUMMARY

ePharma is an online pharmacy with a mission to provide the online consumers withcomprehensive medical information, and a wide variety of pharmaceuticals and medical

supplies at reasonable prices throughout Lahore and in future, Pakistan. We willbe able to sell prescriptions at reduced prices by carefully maintaining efficiencies in ouroperations and by targeting a specific segment of the market - those customers who

prefer online shopping and do not have time to personally visit markets. By focusing onthis segment it gives us additional efficiencies as online buying trend has alreadycaptured most of the internet users and it will soon be a popular trend in Pakistan aswell. ePharma seeks to avail this opportunity and serve the online consumers. ByProviding the customers with home delivery services the company seeks to capture themarket

ePharma will operate through a website (www.epharma.com.pk) that will serve onlineconsumers. We will thrive by employing friendly and knowledgeable personnel, which,

along with our great prices, will drive the repeat business that we will rely upon. Weonly expect that as the internet trend evolves, the ePharma will appeal more and moreto the customer's sense of value and convenience.

Our advertising, mainly through ads in major websites, will be targeted at those whoare looking to save money on a pricey but necessary and regular expense.

ePharma will be led by qualified management with experience in the pharmaceuticalindustry. We expect to reach profitability by our second year and will generate

substantial sales by year three.


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OBJECTI VES

ePharma seeks to create an online sale point where the Customers can buy the

pharmaceutical products through internet.

It will be a platform where all the necessary details of the products will be available tothe consumers to encourage awareness about them. With details of competing oralternative to the desired medicines the consumer can be aware of other such

medicines and their comparative positioning, knows what to buy if one is unavailable.

The company seeks to serve the consumers with services like medical news, events and

forum so that doctors, pharmacists and medical and pharmacy students can also gainbenefits from our site as well as general consumers who may benefits from variousmedical prevention and first aid treatments for diseases like Dengue etc.

In the future, the company plans to hold public awareness seminars to educate those

hungry of knowledge about various diseases and their remedies. The company desiresto promote a healthy Business to consumer relationship by providing them with qualityand standards of services and proper guidance.

The company seeks to be the leading online pharmaceutical company in the nearfuture.

Business Objectives

Company growth Become established as the leading distributor of pharmaceutical products

Financial Objectives

Create and increase revenueMarketing Objectives

Increase marketing efforts Expand market area Expand marketing reach Brand recognition Increase telemarketing efforts


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VISION

To achieve & maintain a respectable position in the health care service in Pakistan &

also in exporting countries by working with dedication & honesty.

MI SSI ON

Offer latest, innovative, cost effective & high quality products to contribute thebasic needs of human beings.

Continuous struggle for the improvement of health care standards. We are committed to enhance the satisfaction of our customers worldwide &

serve them with the highest level of professionalism & commitment.

Maintain an environment of responsibility, accountability, integrity andprofessionalism.

It is the Companys mission to provide website visitors with comprehensive medical

information, and a wide variety of pharmaceuticals and medical supplies at reasonableprices. In carrying out our day-today business operations, we strive:

To treat our employees with fairness and respect, and create an enjoyableworking atmosphere that inspires loyalty and dedication;

To follow the philosophy that our customers are our first priority, and ensure thatall of our personnel are well-trained in providing reliable, timely and efficientcustomer service.

To be considered as a responsible business leader in the community.Key to Success

We believe that the key to success in the overgrowing pharmaceutical industry is

To establish a strong memorable brand name; To provide a comprehensive site encompassing the needs of both consumers and

medical professionals;

To become an authoritative source for medical information; To provide a wide range of services and goods to meet the needs of our target

audiences.


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COMPANY SUMMARY

Company Ownership

Owner is a qualified M.Pharm from Punjab University and has 5 years experience in thepharmacy Business. Due to which he has strong relations with clients and suppliers and

experience in the market.

Start- up Summary

The owner will invest Rs 10,000,000 in the company. The following table and chartshow projected initial start-up costs of Eadco Advertising.

Start-up Funding

Start-up Expenses to Fund 292,000

Start-up Assets to Fund 6,500,000

Total Funding Required 6,792,000

Assets

Non-cash Assets from Start-up 6,500,000

Cash Requirements from Start-up 6,792,000

Additional Cash Raised 0

Cash Balance on Starting Date 3,500,000

Total Assets 10,800,000

Liabilities and Capital

Liabilities

Current Borrowing 0

Long-term Liabilities 0

Accounts Payable (Outstanding Bills) 800,000

Other Current Liabilities (interest-free)

Total Liabilities 800,000

Capital

Planned Investment

Owner 10,000,000

Other 0

Additional Investment Requirement 0

Total Planned Investment 10,000,000


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Loss at Start-up (Start-up Expenses) (292,000)

Total Capital 9,708,000

Total Capital and Liabilities 10,508,000

Total Funding 3,500,000

Start-up

Requirements

Start-up Expenses

Legal 25,000

Stationery etc. 7,000

Brochures 10,000

Advertising 20,000

Expensed Computer Equipment/Software/WebsiteDevelopment)

200,000

Insurance 30,000

Total 292,000

OPPORTUNI TI ES

According to the Population Census Organization of Pakistan (2010), Pakistan has a

population of 16.98 million, with a growth rate of 2.69. Besides this health awareness isalso increasing day-by-day, which may be helpful in increasing the per capitaexpenditure in the future. Internet users are also increasing due to which the internet

shopping and product inquiries are being popular among the individuals. E businesseshave already working in the country. Even Pharmaceutical companies are tendingtowards electronic markets. Among all the therapeutic groups, two groups namely

alimentary tract and metabolism, and systemic anti-infective lead the market with

shares of 20.28% and 24.7%, respectively. Excluding these two groups, all the othersegments are not contributing in double digits. No doubt that these segments have gotextreme importance in the pharmaceutical sector, but either these segments areneglected or these segments are not beneficial for the companies financially. But bylooking at the current situation, the number of hypertensive patients is increasing at analarming ratio, along with the emergence of new diseases.


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Various Therapeutic Segments in Pakistan Market

S.No. Therapeutic Class Share% Growth%

TOTAL MARKET 100 11

1 Alimentary Tract & Metabolism 20.8 10

2 Blood & Blood Forming Organs 3.3 19

3 Cardiovascular System 7.2 7

4 Dermatological 3.5 13

5 GU System & Sex Hormones 2.6 5

6 Systemic Hormones (excluding sex hormones) 1.0 12

7 Systemic Anti-Infective 24.7 13

8 Hospital Solutions 1.0 3

By looking at the above table it is obvious that only two segments are contributing, andno other segment is performing up to the mark. All the pharmaceutical companies

should look into these figures and try to explore the segments for not performing up tothe mark. Furthermore, it is also an opportunity for the companies to capitalize on thissituation and try to generate sales from these segments. The data also highlights that

other segments like blood and blood forming organs, dermatology and systemichormones, has got significant growth, and if focused can contribute significantly to the

total pharmaceutical market.

Diseases Burden of Pakistan according to their Occurrence

DI SEASES BURDEN

Communicable 38%

Other Non-communicable 19%

Reproductive Health 12%

Cardiovascular, Diabetes 11%

Injuries 11%

Nutritional/ Endocrine 6%

Neuro-Psychatric 3%


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Risk Factors

No doubt that the Pakistan Pharmaceutical Market is growing at a steady rate but there

are certain challenges which pose a great threat to the industry. The Company hasidentified the following risk factors which could hamper its success:

Problems generating visibility and product positioning; Overly aggressive and debilitating actions by competitors; Changes in consumer buying trends; Changes in federal or state/provincial legislation applicable to the industry; Import of raw material which costs a lot of precious foreign exchange Rapid devaluation of the rupee against the major currencies, due to which the

profit margins are shrinking

Increasing cost of manpower and energy Low R&D expenditure, which can lead to the suffering of the masses for not

conducting sufficient research on the newly emerging diseases in the Pakistani

environment

Political instability is another major factor which is emerging as the majorchallenge to the pharmaceutical industry, because of discontinuation of thepolicies

Last but not the least, the deteriorating law and order situation, due to whichmost of companies have suffered in terms of sales and also lack of reach to thecustomers in the affected areas.

Market access is challenging and operational risks are high. One of the major challenges which the pharmaceutical industry faces is the total

government control on the prices of all the enlisted products


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Financial Plan

ePharma will initially be funded by Rs. 1,00,00,000 Funded by the Owner, with the helpof which the land, building and equipment will be purchased. The company will have its

initial inventory worth Rs. 15,00,000 of which Rs.7,00,000 will be paid and rest is oncredit. The initial Employment cost will be:

Designation Quantity Salary Total Cost

CEO 1 80,000 80,000

Manager 3 30,000 90,000

Accountant 3 15,000 45,000

Sales person 5 12,000 60,000

Administration 3 15,000 45,000

MIS 4 20,000 80,000Customer service 6 12,000 72,000

Security Guard 2 10,000 20,000

Peons 2 8,000 16,000

Total 5,08,000

However with the growth of the company Additional Staff will be hired as perrequirement.

Balance Sheet

Year 2012 Year 2012

Assets RS. RS.

Current Assets

Cash 36,00,000

Inventories 15,00,000

Total Current Assets 51,00,000

Long-term Assets

Land 35,00,000

Building 12,00,000

Equipment 10,00,000


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Total Long-term Assets 57,00,000

Total Assets 1,08,00,0 00

Liabilities and Capital

Current Liabilities

Accounts Payable 800,000

Total Current Liabilities 800,0 00

Long-term Liabilities 0

Total Liabilities 800,0 00

Capital 1,00,00,000

Total Capital 1,00,00,000

Total Liabilities and Capital 1,08,00,0 00


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Marketing Strategies

ePharma plans to market the company through internet where most visited sites will be

hired to advertise the company, along with the paper media, radio. The internet usersare rapidly increasing in Pakistan providing the opportunity for the businesses topromote E-businesses, and that is our Starting point. Furthermore sponsoring events

and other modes of advertisement are also under consideration.

Products & Services

The Company will offer, through its website, a wide variety of medical products andservices for sale to both consumers and professionals. Products include

pharmaceuticals, medical equipment, supplies, Which Includes:

Products & Services for Consumers

Pharmaceuticals Medical supplies & equipment Herbal preparations Home healthcare items

Vitamins and supplements Physician & hospital directories Illness & symptom directory

Consumer-oriented health news Drug toxicology guide Substance abuse guide & resources

Baby / child health resources Nutrition & fitness resources

Products & Services for Medical Practitioners and Facilities

Pharmaceuticals Medical supplies & equipment Medical schools directory

Online medical bookstore, for sale of books, software & videos Local, regional, national & international health alerts Medical news, information, resources Illness & symptom directory Drug toxicology guide Substance abuse guide & resources

Professional organizations & services directories Office software

Medical office supplies

The Company has planned to established relationships with the leading fulfillment

suppliers of pharmaceuticals and medical supplies and equipment.


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Documents

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