Business plan on Bangladesh Corporate Software Sales

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Business plan on Bangladesh Corporate Software Sales

This business plan outlines the strategy for sales of enterprise software planning solutions to medium-sized companies and franchises in Bangladesh.

Bangladesh Corporate Software Sales (BBCSS) will act as the direct sales arm of a software manufacturing firm based in Oregon. We expect a high degree of profitability based on our plan to key in on businesses that have already expressed the need for such services and products to the software manufacturer. Our management expertise in dealing with corporate decision makers and our partner’s reputation will be the cornerstone of our success.

Company Summery

BCSS provides enterprise-corporate planning software solutions. We identify companies’ planning needs and work with a third-party manufacturer to create software to address these needs. Although the actual software is produced out-of-house, we guarantee the customer the right solution.


  • Market a business planning software package to corporate managers and achieve Tk1000 in commission fees in year one.
  • Customize the software to the individual needs of each client.
  • Provide training and follow-up service to each client.


The employees of BCSS recognize that information is vital for management and presenting that information in an efficient and easily understood framework is crucial. Also, not every business manager requires similar tools; what works for a service based company might be useless for a manufacturer. That’s why we market an already proven third-party software planning tool which we will customize to the client’s individual needs. Although we recognize the intimate relationship between profitability and quality products, we know that our success is ultimately dependent on the well-being of our employees.

Keys to Success

The success of our company is dependent on our ability to:

  • Anticipate clients’ needs.
  • Adapt software solutions to these needs.
  • Identify industries/corporations that need planning tool

Start-up Summary

Start-up costs, which cover phone calls, office furniture, letterhead and business cards, come to Tk 3,050. These costs will either be financed by owner investment or through financing from the software manufacturing partner. Details and assumptions are summarized in the following chart and table.


Start-up Expenses
Legal Tk300
Stationery etc. Tk250
Brochures Tk0
Consultants Tk0
Insurance Tk1,000
Rent Tk0
Research and development Tk0
Expensed equipment Tk1,500
Other Tk0
Total Start-up Expenses Tk3,050
Start-up Assets Needed
Cash Balance on Starting Date Tk11,000
Other Current Assets Tk0
Total Current Assets Tk11,000
Long-term Assets Tk0
Total Assets Tk11,000
Total Requirements Tk14,050
Investor 1 Tk9,000
Investor 2 Tk4,550
Other Tk0
Total Investment Tk13,550
Current Liabilities
Accounts Payable Tk500
Current Borrowing Tk0
Other Current Liabilities Tk0
Current Liabilities Tk500
Long-term Liabilities Tk0
Total Liabilities Tk500
Loss at Start-up (Tk3,050)
Total Capital Tk10,500
Total Capital and Liabilities Tk11,000


Company Locations and Facilities

The company will be located in a home-based office in Portland, Oregon. This location is ideal, as it is close to the software manufacturer’s facilities and several of the first potential clients’ home offices.

Business environment

The business environment that affects our venture is characterized below-

Demographical environment:

Now it’s a world of increasing technology and our country is about to adjust its step with it. People of all age are increasingly dependent on the Internet and it helps to communicate with outer world.

Economical environment:

The current GDP growth rate is 6.5% and expected to grow at a higher than this rate in year 2006. So, the economic growth is very excellent in the country and hence we can capitalize upon the fact i.e. demand for goods increasing.

Political environment:

There is huge political uncertainty in the country. So we have to face the political uncertainty to be successful. It is our of our risk of the on going business.

Legal environment:

Legal environment is about good because the order and law situation is quite good with the activity of “QUICK JUDGEMENT TRIBUNAL” and “RAB”.

Cultural and social environment:

The city and sub-urban life of the country is very much dependent on internet and communication technology. But the urban area is not likely to that extent. So the culture of the country is not enough to judge the venture.

2.0 Products and Services

BCSS will provide medium- and large-sized companies with enterprise-wide collaborative planning solutions. We will also provide consulting services by helping companies recognize opportunities for using technology to streamline their business processes. Finally, we will provide complete training for the use of solutions purchased from us.

Product and Service Description


BCSS software products consist of a business planning software package that is proven in the consumer market. In fact, this product is the top-rated and best-selling small business planning package. The enterprise version will be similar to the consumer version however; it will be modified to fit the needs of different clients. The product will allow corporate sales forces and franchises to use planning tools to achieve tremendous efficiencies in their business processes. In essence, a sales force will be able to write concise business plans for any customer and through the use of an extranet, allow the customer to collaboratively plan their own account. Franchises will be able to create a road map of their business plans that corporate managers can monitor and adjust accordingly. The possibility exists to customize the product to work with other collaborative tools such as Lotus Notes and the clients email applications.


BCSS will perform an analysis of all potential clients’ planning strategies and tactics as well as their degree of aptitude with planning software and information technology. The goal of this analysis is to ensure that all clients get a solution that best fits their needs and capabilities. Whether they decide to purchase the product or not they will have an expert analysis of their planning strategies.


BCSS will provide further value to our customers, and ease the customer service burden on our partner, by ensuring that all product users are properly trained in the use of all software solutions.


Through the software manufacturer, BCSS will provide an additional product which will give the client a dedicated service representative–eliminating the need for product updates. This will in essence create a “living” product which can grow and adapt with the clients’ needs. The interface representative will function through the clients’ established extranet.

Competitive Comparison

Alternative products do not offer a complete package of tools. For example, to get similar results from another product(s) the client would have to integrate complex spreadsheets, word processing software, instructions and Web based collaboration themselves.


The software package runs on Windows 95, 98, 2000, Windows NT, and Macintosh platforms.

Market Analysis Summary

We operate in the business-to-business segment of e-commerce which recent research estimates transactions in excess of Tk160 billion ( Our market is further segmented into companies with sales forces greater than 100 people and companies with branches, divisions or franchises in excess of 100 units.

Market Segmentation

We segment our market by size of sales force and number of company subunits. Our target customers will have sales operations in excess of 100 direct sales representatives or more than 100 organizational subdivisions or franchises. For the first three years of operation we will focus on U.S. companies in the Pacific Northwest, California and the Southwest. Geographically this make sense as our office is central to these regions and management has established key client contacts in each of these areas. Larger clients are more likely to benefit from the efficiencies our product offers and will provide fees that will sustain our profitability. Exact figures for the number of businesses are hard to determine, however, the lean structure of our company will allow us to be profitable by generating two to three new clients per year.

Market Analysis (Pie)

Market Analysis

Potential Customers Growth 2000 2001 2002 2003 2004 CAGR
Sales Companies 3% 500 515 530 546 562 2.97%
Franchises 2% 800 812 824 836 849 1.50%
Other 5% 200 210 221 232 244 5.10%
Total 2.49% 1,500 1,537 1,575 1,614 1,655 2.49%

Target Market Segment Strategy

Our strategy is designed to target:

A Medium- to large-size organization whose sales forces provide their clients with proposals and plan that the client either collaborates on, or would benefit from collaboration.

Companies that sell franchise rights and take an active role in the success of their franchises.

Larger clients that will provide greater revenues through a larger volume of software licensing sales and greater chance of selling client interface solution.

Market Needs

Customization-products that strengthen their brand and address their differences:

We will “Private Label” the solution so as to further strengthen the clients’ brand.

We recognize that different clients will have varying levels of sophistication and we will design different product templates for each customer.

Speed, efficiency and information:

Our product will allow the client to make better and faster business decisions and receive quicker feedback from their end-customer.

Managers will have the ability to monitor the progress and profitability of their staff.

Market Trends

The most significant trend affecting our company is the growth of business-to-business e-commerce. More and more firms recognize the need to take advantage of the exchange of information over the Internet and our products and services rely on this.

Market Growth

The fastest growing segment of the e-commerce industry is the business-to-business sector. This segment has gone from less than Tk50 billion to more than Tk160 billion in three years.

Service Business Analysis

Customers tend to buy enterprise software solutions based on reputation, price and reliability. Also, compatibility with existing or legacy systems is very important. With this in mind, the key decision makers and influencer(s) will be the companies’ chief financial officer and chief information officer.

Business Participants

There are currently several companies that provide business planning software for desktop applications, but as yet none of these offer enterprise-wide solutions. Additional competitors are companies which provide word processing, spreadsheet and collaborative planning software, as well as publishers of business planning literature.

Strategy and Implementation Summery

Various strategy/and implementation topics are discussed in the following sections.

Competitive Edge

Our greatest strength and competitive edge is the reputation and success of the desktop software product. This product is the market leader in sales and consumer ratings. Our success will rely upon building on those strengths. We will also rely on our experience working with decision makers at the corporate level.

Marketing Strategy

We will first target the corporate offices of franchises with more than 100 units, and companies with sales forces in excess of 100 personnel. The software manufacturer has already provided the names and contact information for several firms which fit this profile. These firms have approached the software manufacturer about enterprise solutions in the past. The software firm has also provided a list of larger businesses that purchased an executive version of their desktop product. We will contact these firms with the idea of helping them take this planning tool to the next level.

Management of BCSS has business contacts at the decision maker level for several more prospects as well. These will be our secondary targets.

Tertiary targets will come from lists of firms fitting the above criteria which management has generated through Web-based market research efforts. Tactics for approaching these prospects will be indirect, i.e., we will contact sales managers and/or franchisees to establish whether the firm fits our profile and then probe for upper or middle level management contact information. We will attempt to establish a face-to-face meeting with decision makers (CFO, CIO, and COO) where we will present a proposal tailored to their needs. If possible, we will also have this proposal reside on an extranet so that the client can modify the proposal and see first-hand how the product and service work.

Positioning Statement

This is an expensive solution to develop and maintain, and the price will reflect the premium quality of the offering. Set-up costs to the client will run between Tk100K-Tk200K. The dedicated service option is approximately Tk5K/year. Software licenses are Tk100/year.

Sales Strategy

Our sales consist of two services–consulting and training, and one product-the software/extranet package (called start-up sales). Our services provide a fraction of the revenue we will receive for the software/extranet solution, but they will sustain our cash flow needs while we develop the enterprise sales. Sales of consulting, training and product are predicted to grow at 30%, 20% and 10% respectively. Costs associated with these sales are estimated at 10% for start-up sales, 40% for consulting fees and 50% for training. We expect these costs to decrease two, five, and ten percentage points respectively in years two and three.

Sales Monthly

Sales Forecast

Sales Forecast
Sales FY 2001 FY 2002 FY 2003
Start-up fees Tk150,000 Tk165,000 Tk189,750
Consulting fees Tk2,400 Tk3,120 Tk4,368
Training fees Tk2,550 Tk3,060 Tk3,978
Total Sales Tk154,950 Tk171,180 Tk198,096
Direct Cost of Sales FY 2001 FY 2002 FY 2003
Start-up fees Tk15,000 Tk13,200 Tk15,180
Consulting fees Tk960 Tk1,092 Tk1,529
Training fees Tk1,275 Tk1,224 Tk1,591
Subtotal Direct Cost of Sales Tk17,235 Tk15,516 Tk18,300
Management Summery

Ronald Ivanhoe, 33, founded the company in September of 2000 to take advantage of a partnership opportunity with a highly successful Pacific NW software company. He has an MBA in marketing and e-commerce from the University of Arizona, and has designed numerous successful business plans for companies in the manufacturing, e-commerce and entertainment sectors. He consults with insurance brokers, e-commerce, and manufacturing companies in marketing strategies. He has lived in Asia for five years, speaks Japanese fluently and currently resides in Portland, OR.

Personnel Plan

Payroll expenses reflect the salary of Mr. Ivanhoe.


Personnel Plan
FY 2001 FY 2002 FY 2003
Name or title Tk0 Tk0 Tk0
Other Tk0 Tk0 Tk0
Total People 0 0 0
Total Payroll Tk0 Tk0 Tk0
Financial Plan

The most crucial issue affecting our financial plan is the receipt of start-up fees for the customization and installation of the software and extranet solution. This drives our cash flow, and all other aspects of our operation.

Important Assumptions

This table summarizes the general assumptions used to project our balance sheet.

General Assumptions

General Assumptions
FY 2001 FY 2002 FY 2003
Plan Month 1 2 3
Current Interest Rate 10.00% 10.00% 10.00%
Long-term Interest Rate 8.00% 8.00% 8.00%
Tax Rate 25.42% 25.00% 25.42%
Sales on Credit % 50.00% 50.00% 50.00%
Other 0 0 0

Key Financial Indicators

The chart below shows the relative relationships, year-to-year, of four business indicators; sales, gross margin, operating expenses, collection days of accounts receivable.


Break-even Analysis

We include salary and fixed overhead as fixed costs above and beyond start-up costs. This requires a break-even in sales/month for year one of Tk8,680.

Break-even Analysis

Break-even Analysis:
Monthly Units Break-even 8,680
Monthly Revenue Break-even Tk8,680
Average Per-Unit Revenue Tk1.00
Average Per-Unit Variable Cost Tk0.25
Estimated Monthly Fixed Cost Tk6,510

Projected Profit and Loss

Monthly P&L fluctuate drastically due to the work required before a sale is closed. One to two months prior to closing a sale, we will incur travel costs and other miscellaneous expenses associated with our consulting service. Expenses are approximately 40% of fees. Set-up costs to the client (our commission), drive revenue in the period a sale is made, as do training fees. Associated direct costs are 10% and 50% respectively; however, as we anticipate a learning curve in training costs, these decrease to a flat rate in year two of eight percent. The direct cost of start-up fees is our major expense. As the client prepares to go live with the product, we will need to travel more frequently to the site, bring in their key end-customers, and travel to the manufacturer more frequently as well. We have anticipated that start-up fees will grow 10% in year two and 15% in year three. Consulting fees are projected to grow at a steady rate of 20% and training fees at 30%. As a result, net profit is projected to grow at a conservative and realistic three percent for the first three years.

Profit and Loss

Pro Forma Profit and Loss
FY 2001 FY 2002 FY 2003
Sales Tk154,950 Tk171,180 Tk198,096
Direct Costs of Goods Tk17,235 Tk15,516 Tk18,300
Other Tk0 Tk0 Tk0
———— ———— ————
Cost of Goods Sold Tk17,235 Tk15,516 Tk18,300
Gross Margin Tk137,715 Tk155,664 Tk179,796
Gross Margin % 88.88% 90.94% 90.76%
Payroll Tk0 Tk0 Tk0
Sales and Marketing and Other Expenses Tk4,000 Tk5,000 Tk6,000
Depreciation Tk0 Tk0 Tk0
Leased Equipment Tk0 Tk0 Tk0
Utilities Tk480 Tk0 Tk0
Insurance Tk1,440 Tk0 Tk0
Rent Tk4,200 Tk4,200 Tk4,350
Payroll Taxes Tk0 Tk0 Tk0
Other Tk0 Tk0 Tk0
———— ———— ————
Total Operating Expenses Tk10,120 Tk9,200 Tk10,350
Profit Before Interest and Taxes Tk127,595 Tk146,464 Tk169,446
Interest Expense Tk0 Tk0 Tk0
Taxes Incurred Tk31,888 Tk36,616 Tk43,068
Net Profit Tk95,707 Tk109,848 Tk126,378
Net Profit/Sales 61.77% 64.17% 63.80%

Projected Cash Flow

Our cash flow assumptions are dependent on the start-up fee. We will receive 15-20% of the total fee in commission. Historical values of start-up fees are from Tk150K to Tk200K and the accounts have taken from one to four months to close. Conservative estimates lead us to believe that we can attain sales revenue from start-up fees of between Tk135K and Tk240K in year one.


Cash Flow

Pro Forma Cash Flow
FY 2001 FY 2002 FY 2003
Cash Received
Cash from Operations:
Cash Sales Tk77,475 Tk85,590 Tk99,048
Cash from Receivables Tk77,195 Tk85,561 Tk98,999
Subtotal Cash from Operations Tk154,670 Tk171,151 Tk198,047
Additional Cash Received
Sales Tax, VAT, HST/GST Received Tk0 Tk0 Tk0
New Current Borrowing Tk0 Tk0 Tk0
New Other Liabilities (interest-free) Tk0 Tk0 Tk0
New Long-term Liabilities Tk0 Tk0 Tk0
Sales of Other Current Assets Tk0 Tk0 Tk0
Sales of Long-term Assets Tk0 Tk0 Tk0
New Investment Received Tk0 Tk0 Tk0
Subtotal Cash Received Tk154,670 Tk171,151 Tk198,047
Expenditures FY 2001 FY 2002 FY 2003
Expenditures from Operations:
Cash Spending Tk15,702 Tk16,033 Tk19,405
Payment of Accounts Payable Tk39,957 Tk45,213 Tk51,436
Subtotal Spent on Operations Tk55,659 Tk61,246 Tk70,840
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out Tk0 Tk0 Tk0
Principal Repayment of Current Borrowing Tk0 Tk0 Tk0
Other Liabilities Principal Repayment Tk0 Tk0 Tk0
Long-term Liabilities Principal Repayment Tk0 Tk0 Tk0
Purchase Other Current Assets Tk0 Tk0 Tk0
Purchase Long-term Assets Tk0 Tk0 Tk0
Dividends Tk0 Tk0 Tk0
Subtotal Cash Spent Tk55,659 Tk61,246 Tk70,840
Net Cash Flow Tk99,011 Tk109,905 Tk127,207
Cash Balance Tk110,011 Tk219,916 Tk347,123

Projected Balance Sheet

Balance sheet is a result of key assumptions and estimated sales/cash flows.

Balance Sheet

Pro Forma Balance Sheet
Current Assets FY 2001 FY 2002 FY 2003
Cash Tk110,011 Tk219,916 Tk347,123
Accounts Receivable Tk280 Tk309 Tk358
Other Current Assets Tk0 Tk0 Tk0
Total Current Assets Tk110,291 Tk220,226 Tk347,481
Long-term Assets
Long-term Assets Tk0 Tk0 Tk0
Accumulated Depreciation Tk0 Tk0 Tk0
Total Long-term Assets Tk0 Tk0 Tk0
Total Assets Tk110,291 Tk220,226 Tk347,481
Liabilities and Capital
Current Liabilities FY 2001 FY 2002 FY 2003
Accounts Payable Tk4,085 Tk4,171 Tk5,048
Current Borrowing Tk0 Tk0 Tk0
Other Current Liabilities Tk0 Tk0 Tk0
Subtotal Current Liabilities Tk4,085 Tk4,171 Tk5,048
Long-term Liabilities Tk0 Tk0 Tk0
Total Liabilities Tk4,085 Tk4,171 Tk5,048
Paid-in Capital Tk13,550 Tk13,550 Tk13,550
Retained Earnings (Tk3,050) Tk92,657 Tk202,505
Earnings Tk95,707 Tk109,848 Tk126,378
Total Capital Tk106,207 Tk216,055 Tk342,433
Total Liabilities and Capital Tk110,291 Tk220,226 Tk347,481
Net Worth Tk106,207 Tk216,055 Tk342,433

Business Ratios

The following table outlines important business ratios for pre-packaged software, as described by the standard industry classification (SIC) index, 7372.


Ratio Analysis
FY 2001 FY 2002 FY 2003 Industry Profile
Sales Growth 0.00% 10.47% 15.72% 9.70%
Percent of Total Assets
Accounts Receivable 0.25% 0.14% 0.10% 21.50%
Inventory 0.00% 0.00% 0.00% 3.00%
Other Current Assets 0.00% 0.00% 0.00% 45.70%
Total Current Assets 100.00% 100.00% 100.00% 70.20%
Long-term Assets 0.00% 0.00% 0.00% 29.80%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabilities 3.70% 1.89% 1.45% 42.40%
Long-term Liabilities 0.00% 0.00% 0.00% 19.20%
Total Liabilities 3.70% 1.89% 1.45% 61.60%
Net Worth 96.30% 98.11% 98.55% 38.40%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 88.88% 90.94% 90.76% 100.00%
Selling, General & Administrative Expenses 65.84% 64.01% 60.68% 79.40%
Advertising Expenses 0.00% 0.00% 0.00% 1.30%
Profit Before Interest and Taxes 82.35% 85.56% 85.54% 2.20%
Main Ratios
Current 27.00 52.80 68.84 1.51
Quick 27.00 52.80 68.84 1.16
Total Debt to Total Assets 3.70% 1.89% 1.45% 61.60%
Pre-tax Return on Net Worth 120.14% 67.79% 49.48% 3.50%
Pre-tax Return on Assets 115.69% 66.51% 48.76% 9.20%
Additional Ratios FY 2001 FY 2002 FY 2003
Net Profit Margin 61.77% 64.17% 63.80% n.a
Return on Equity 90.11% 50.84% 36.91% n.a
Activity Ratios
Accounts Receivable Turnover 276.70 276.70 276.70 n.a
Collection Days 45 1 1 n.a
Inventory Turnover 0.00 0.00 0.00 n.a
Accounts Payable Turnover 10.66 10.86 10.36 n.a
Payment Days 32 33 32 n.a
Total Asset Turnover 1.40 0.78 0.57 n.a
Debt Ratios
Debt to Net Worth 0.04 0.02 0.01 n.a
Current Liab. to Liab. 1.00 1.00 1.00 n.a
Liquidity Ratios
Net Working Capital Tk106,207 Tk216,055 Tk342,433 n.a
Interest Coverage 0.00 0.00 0.00 n.a
Additional Ratios
Assets to Sales 0.71 1.29 1.75 n.a
Current Debt/Total Assets 4% 2% 1% n.a
Acid Test 26.93 52.73 68.76 n.a
Sales/Net Worth 1.46 0.79 0.58 n.a
Dividend Payout 0.00 0.00 0.00