Name &Address of the company: S&M Garments Com. Ltd.
21, Tipusultan Road, Wari, Dhaka-1100
Description of the business: This business will provide the garments product on the basis to small and medium-sized business.service include we designe product and modles . By utilizing Virtual Design Center, we will work in real-time with our customers to meet their design needs, which will reduce errors and detect design flaws early in the process. Additionally, our unique Virtual Design Center gives us a definitive advantage.
Financing: Titus Mold Manufacturing, Inc. requires 3,00,00,000tk. to launch. At present, we have raised 3,00,00,000tk. in venture capital funds. We are currently seeking funds from outside investors and business loans.
The start-up funds will be used to cover the facility, build-out costs, equipment, software and initial operating costs including payroll, taxes, and utilities.
Titus Mold Manufacturing, Inc. designs prototypes and molds, which are used by production manufacturers to fabricate consumer products. We are a start-up company that developed and patented revolutionary design software called Virtual Design Center. Our initial plan is to create a precision manufacturing facility to produce prototypes and molds for clients. Our goal is to provide our customers with fast turnaround, exceptional quality, unparalleled customer service, and competitive pricing.
PRODUCTS & SERVICES
We design and manufacture prototypes and molds. By utilizing Virtual Design Center, we will work in real-time with our customers to meet their design needs, which will reduce errors and detect design flaws early in the process. In turn, this will save the customer time and money. We plan to position ourselves as a forward-thinking company that continually invests in new ideas and technologies – unlike our competitors, which are similar mold manufacturing facilities. Because of our unique software, sophisticated technology and efficient processes, we will be in a position to potentially compete on price and quality. Additionally, our unique Virtual Design Center gives us a definitive advantage.
STRATEGY & IMPLEMENTATION
To achieve our business goals, we will create a high-tech, precision manufacturing facility and will implement highly efficient operations processes. We plan to promote our proprietary Virtual Design Software with an aggressive, targeted marketing campaign. This will include a media campaign, print and online advertising and a targeted direct-mail campaign. In addition, we will focus heavily on establishing our presence within the industry at relevant trade shows.
Our leadership team currently consists of Chief Executive Officer Sokamal asha, President Mydul Islam. Additional key leaders will include directors of finance, marketing and sales, human resources, information technology and operations. While these positions remain unfilled at this time, we do have several extremely qualified candidates interested in joining with us in this new venture.
Our Company will earn revenue from the sale of design services and manufactured molds. The attached Income Statement demonstrates that our gross profit margin will exceed 52%, and we will achieve break-even with sales of XXX,XXXtk. We expect to reach profitability by the middle of Year 2.
LEGAL ENTITY & OWNERSHIP
S&M Garments Com. Ltd. will provide All garments product. The company’s principal owners are Sokamal saha, Md.mydul Islam who hold equal shares of ownership in the company.
COMPANY HISTORY TO DATE
Our company is a new business that will create prototypes and quality molds, utilizing the latest design software, e-commerce technology, high tech machinery and innovative operations processes. As the company’s founders and owners After recognizing the need for and value of creating a more efficient customer experience to secure and retain business
Titus Mold Manufacturing holds a patent for its revolutionary Virtual Design Center (VDC). The VDC combines the best of virtual and in-person presentations and meetings, allowing customers to work in real-time with our design engineers. This allows us to serve clients nationwide.
Market Area and Size and Characteristics
Market is a collection of buyers and sellers, where buyer share a particular need or want that can be satisfied by a company’s products or services. Every business sells some type of product or service to people. Not every buyer will buy every one’s product. People who can be counted as potential customers are divided into three categories:
· People who need or want the service or products
· People who are able to buy the services or products
· People who are willing to buy the services or products
Market area is the most important marketing considerations to thoroughly know and understand the potential customers. As new entrepreneurs we have to analysis that in which area we can target for our potential customers, how many they are what actual services or product they want, why and when they want and so on. For our Traxcom Knitwear business the potential market will be in North America such as USA, Canada and Europe. As the preliminary stage our market area will not be so large but we are optimistic to increase our market area step by step in near future.
Market Size and Characteristics:
As market size will be large it will be flexible to do business. There are four type of market size exists in a country.
Monopoly market: here only one company exists in a market.
Duopoly market: here two companies exist in a market.
Oligopoly market: In oligopoly market system more than two companies exist in the market.
Perfect Competitions: This type of market system is practiced largely. In this system every one can do business free and fairly. Business can be flexible in perfect competition. The overall market condition remains stable in perfect competition.
As new entrepreneurs of NTRS energy savings bulb business our market size will not be so large. Approximately 600000 units of product will be sold in 2011. Then will try to.increase the number production unit double in the next year.
Description of the Product
Basic T- Shirt: Normal T – Shirt that means which have only color like white,
red, black, green etc. In this T-Shirt we are not using any kind of design.
Polo Shirt: Which T-Shirt those have no round collar only using collar. In this
T-Shirt we are using different kind of color and also design.
Tank Top: Tank top includes in ladies collection. We are using different design
and various kind of color both light and dark color.
Shorts: We have two types of shorts. Ladies and gents. In here we are using
different design and color to attract the customer.
Trousers: We made both ladies and gents trousers. Trousers and shorts are not same type or same size.
Tops: Tops are ladies and kids wear. These are different in color and design. In here mainly we are using light color like pink, blue, yellow etc.
Baby Sets: We are also made baby sets which are very soft. In here we are using mainly light Color like pink.
Our main target customers are North American and European buyer. In North America, Canada and America is our main customer. On the other hand, In Europe, England, France, Germany, Italy, Nominee, Check Republic, Denmark etc are the buyer.
We have two types of customer-
Direct customers are those customers, who buy our product directly via L/C and don’t have any middle man in between.
Indirect customers are those customers who buy our product indirectly via buying house. Here, buying house get some commission gives the L/C in the name of the company.
|Name of buyers||Name of buying house||Country of origin||Remards|
|Kiabi||Tritox texle ltd||France|
|Wall mart||Fashion maker||Canada|
|Addidus||World of texlite||Germany|
We will find to different kind of competitors here. One is the local competitors and the other is the international competitors. Our local knitwear company is our local competitors like: Nasa Knitwear, logos knitwear, mondol knitwear etc. Our international competitors are china, India, Hong Kong, Vietnam, Indonesia, Pakistan etc.
In here we have some advantages. Like-
Right now China is shifting to the luxuries product. They have no interest on knit wear business any more. This is an advantage for us. So, we might capture some more new market which is right now capturing by the China.
In India, there product price is relatively high compare to Bangladesh. One the other hand, there product quality not so good again compare to Bangladesh. As a result we might get some competitive advantage here.
Right now Pakistan is facing political problem. As a result, no buyer is interested to invest in Pakistan.
If our diplomacy with other country is good we might enjoy some benefit. For example: Quota system. In early age of 2000 Canada gave us quota benefit, where our business organization has to buy the quota. So, we have to make strong diplomacy policy with North America and European country to enjoy this kind of benefit.
Marketing Mix Strategy
Marketing mix is the set of marketing tools that the farm uses to pursue its marketing objectives in the target market. As a new entrepreneur we will try to utilize these marketing tools in a proper way.
Figure: Marketing Mix
The products of S&M Garments Com. Ltd include:
trouser, t-shirt, polo shirt, under wear etc. Here we will try to maintain the best quality and design of the product according to the customer’s requirement. Our product will be available in different sizes, such as extra large, large, medium and small sizes. In case of packaging we will try to maintain well designed package to increase the promotional value. Usually we will not provide any warranties for our product, but if there is any problem in our product then we will try to adjust it with the next shipment.
While setting the price, we will try to cover the price in such a way that must have acceptable to the customer, must have competitive with similar products and will cover the cost. For our product the list price will start from $ 1 to $ 30 .It can vary from product to product. We will also provide discount system; it may be occasional discount, seasonal discount, and discount for regular buyers and so on.
For our knitwear products, we will have no distribution channel. We will hire cargo and directly put it to the ship. It will be our distribution channel. More over us will set the appropriate location for our product. In case of inventory we will always keep 5% of product in the warehouse in case of shortage and surplus. The transportation, our company will use to reach the target customer will be cargos and ships.
We will provide different types of short term incentives to encourage the purchase. By building good relations with the company’s favorable publicity, building up a good corporate image and handling unfavorable events we can increase the promotion for our product.
Critical risk and Assumption
Here, we will discuss about the risk our business might face. We have to try to minimize it as much as possible.
Competitor always risk for an organization. It is true for international business or local business. In here we might face competition by local company or by the international parties.
· Local company
· International parties
We have a lot of Knitwear Company in our country. If we face competition by them, that refer to local company competition. For example: Nasa Group, Mondol group, Logos etc.
If we face competitor by the other country like: China, Vietnam, Hong Kong etc. That goes to country competitor or international parties’ competition.
It is directly effect to the price & quantity of the product that refers to non-tariff Barriers. In 2004, USA & CANADA had a Quota system. They said that they will import a fix amount of product each year from Bangladesh and our business organization used to buy it. But now we don’t enjoy this benefit anymore.
We might face political risk when we involve in international business. Here we have to talk about two parties.
· Local political risk
· International political risk
Local political risk:
We see sometime political party put presser in the Business organization for their own benefit we need to calculate that all the time.
International political risk:
If two countries government make decision that they will not do business with each other and also government does not allow to do business with other country our business might be effected.
For example: Israel, we are not allowed to do business with Israel.
Right now the whole world is facing the economic crisis. It also heavily affects the international business. We see that people does not have enough money in their hand so they can not purchase the product.
People do not have enough money so their purchasing power decreases. As a result our product price also decreases but still people are not buying the product. Right now the whole world is facing the price risk.
Day by day people demand is decreasing because they don’t have money in their hand. For example: we read an article in internet where I find that whoever used to buy 10 T-shirt now they are buying 3 or 4 T-shirt.
We heavily depend on North America & European market. Now their demand decreases. So we are facing the Market risk. Here, we have to find the new market to minimize the market risk.
Suppliers form an important link in the company’s overall customer value delivery system. They provide the resources need by the company to the product its goods and services. Supplier problems can seriously affect the organization. Organization managers must watch suppliers problem such as (supply shortages or delays, labor strikes and other events can cast sales in the short run) that it may not create risk of the organization.
Inflation is very much related with economic growth of a country. High inflation create problem for economic growth. If we can minimize the inflation rate that will help us to do the economic growth it also affected the international business. So we have to minimize it as much as possible.
We are doing international business .As a result we have to deal with international currency .It might fluctuate more than we expected some time. We have to set a price for currency with the bank so that we can minimize the currency risk.
Any investments for a new business always hold the risk. As investment is high risk will be also high. So the company should take better investment decision and have to have risk taking capacity.
Culture refers to the learned norms based on attitudes, values and beliefs of a group of people because people simultaneously belong to different groups that have different culture and most of the culture are interrelated various aspects. If we don’t know the culture of each other we might face lot of problem to do business.
Many management problems and issues can be approached in ways that are rational, logical, objective, and systematic. Managers can gather data, facts and objective information quantitative model and decision making techniques .If the management can not make right decision or adopt decision making skills organization can fall management risk.
Right now we are facing the marketing risk. The buyer is not placing the order so companies cannot get the order from the market that really creating big problem for the companies.
If the worker does not perform their work properly that might create huge risk for the company. If worker goes against their employer that is main risk for the organization.
Some country government wants the financial statement once in a year some government want it twice in a year and also three times in a year .It might increase or decrease the cost of the organization so we have to think about it too.
Here, we might face problem by the partners too. We have to keep in mind that and try to minimize that as much as possible
The wastages of our product make create problem for the environment and it make create problem for the organization.
As a business organization we can not do any thing that create problem for the society and society people. If we do so we might face problem by the social interest group, politician and public etc.
Contingent refers damage to property. Such as Due to fire, Due to accidents, Due to floods, Buildings failures, Automobile \Vehicles, Machinery, fixtures, Materials stocks, Due to burglars\thefts. So if thus things are happened it may create risk for the organization.
Compensation and Ownership
Name & Address of the Firm: S&M Garments Com. Ltd.
Corporate address: 334, Elephant Road (2nd Floor),
Factory address: 21,Tipusultan Road,Wari,Dhaka-1100
Name & Address of the Partners:
· Name: Sokamal saha
· Name: Md.Mydul Islam
Type of Business:
It’s a Two man partnership business. Production item is basic t shirts, polo shirts, tank top, baby sets, ladies wear etc.
The amount of investment by the partners:
|NAME||CONTRIBUTION IN (TAKA)|
Profit and Loss shared by the partners:
The profit and the losses will be distributed to the partner equally.
Monthly a partner can withdraw 30000 taka. So it will be yearly 360000 per person
The duties and responsibilities of the partners:
The limitation of the action of each partner can take without the consent of the firm:
If any person go abroad, sick, or go for a holiday, on that situation the person will give his/her responsibilities to the other director. And that person’s decision will be final on behave of that person.
Method for Arbitrating and Resolving Disputes:
Major and minor problems will be solved by the partners. The decision will be taken by the partners by taking vote. The majority of the decision will be taken. For example: we have five partners. If three partners take the same decision and other two are not agree, the three partner’s decision will be taken.
Process for dissolving the partnership:
Ø We will dissolve the partnership because for the following reason.
Ø If any partner file bankrupted
Ø If any partner cheat with the firm
Ø If any partner died
Ø If any partner will become mentally disorder
Ø If any partner want to sell his/her partnership
Ø If any partner want to transfer his/her partnership.
Ø If any partner sell his/her share to other person, without give announcement to the partners.
Partner’s per-emptive right:
If any partner want to leave form the firm. He can give his/her partnership to his/her sun, daughter, wife, brother, sister. Or his partnership can distribute equally to the partners. Or any individual partner can buy his/her partnership share.
Process for Expelling partners Fairy:
· If any partner will bankrupted
· If any partner cheat with the firm
· If any partner will cross the money withdraw agreement
S&M Garments Com. Ltd.
Fixed cost Variable cost
Land 20,000,000 Raw material cost 1,000,000
Building 25,000,000 Factory overhead cost 1,200,000
Machine 15,000,000 Office Stationary 100,000
Generator 500,000 Bills (telephone, gas,
Boiler 600,000 water etc.) 200,000
Furniture 6,000,000 Repairing costs 100,000
Ac 100,000 Knitting 1,000,000
Fans 60,000 Dying 5,000,000
Lights 40,000 Accessories 1,500,000
Fixed Deposit 5,000,000 Yarn 10,000,000
Insurance 10,000,000 Lucre (yarn) 2,000,000
Electric wave 50,000
Total Fixed Cost 87,535,000 Total Variable Cost 22,100,000
Total Cost = Fixed Cost + Variables Cost
= 87535000 + 22100000
S&M Garments Com. Ltd.
Selling price = 2 * 68
Variable cost per unit = Variable cost / unit produce
= 22100000 / 505000
Break even quantity = Fixed cost / (Selling price-Variable cost)
= 87535000 / (136-44)
= 951467.3913 units
To reach the breakeven we have to produce 951467.3913 units
S&M Garments Com. Ltd.
At the year ended December, 31
Amount in Tk.
Particulars 2010 2011 2012 2013 2014
Sales 68680000 81600000 136000000 204000000 231200000
COGS -22600000 -27120000 -36612000 -49426200 -66725370
Gross Margin 66420000 54480000 99388000 154573800 164594630
AdminExpense -40000000 -42000000 -50000000 -65000000 -78000000
Selling Expense -10000000 – 12000000 -18600000 -21460000 – 24606000
EBIT 16420000 4800000 30788000 68113800 61988630
TAX(25%) 4105000 1200000 7697000 17028450 15497157
Net Profit 12315000 3600000 23091000 51085350 46491472
S&M Garments Com. Ltd.
CASH FLOW STATEMENT
|Sale of fixed assets||200000||300000||450000||670000||720000|
|Other cash received||500000||520000||850000||1000000||1070000|
|Total cash in
|Management salaries and other salary||40000000||42000000||50000000||65000000||78000000|
|Legal & audit fees||100000||1000000||1200000||120000||1200000|
|Utilities (heat, light & water)||200000||220000||300000||530000||570000|
|Repairs & maintenance||100,000||130000||270000||340000||360000|
|Payment on purchase of fixed assets||250000||250000||250000||250000||250000|
|Income tax payments||4105000||1200000||7697000||17028450||15497157|
|Payments on acc. pay./ Inventories||2842500||3516000||1262000||1500000||1254000|
|Add: Cash in||77380000||90420000||147300000||225670000||232579000|
|Deduct: cash out
Surplus or Closing cash balance
S&M Garments Com. Ltd.
Year ended December, 31
Particulars Amount in Tk
Liabilities and Owners Equity
Account Receivable 7000000
Total Fixed Assets 61270000
Total Assets 109275000
Accounts Payable 2842500
Notes Payable 6432500
Total current Liabilities 9275000
Long Term Liabilities
Bank Loan 70000000
Shareholder’s Equity 30000000
Total Liabilities and
Owner’s Equity 1092750000
S&M Garments Com. Ltd.
At the year ended 2011-2014 Dec 31
|Asset||Year 2011||Year 2012||Year 2013||Year 2014|
|Total current asset||55000000||57500000||71492000||83000000|
|Total fixed asset||53516000||45762000||38008000||30254000|
|Total current Liabilities||13516000||13262000||14500000||13254000|
|Long term Liabilities|
|Total long term liabilities||95000000||90000000||95000000||100000000|
|Total liabilities and owner’ equity||108516000||103262000||109500000||113254000|