A Presentation on

A sports Equipment Shop

BUS 101

Spring-2015

Course Project

Prepared for:

Tahera Ahsan (TRA)

Prepared By:

Ali Arfi Shafat Chowdhury: 1510376630

Shanta Biswas: 1513243030

Monisha Sur: 1512231630

Mokesh Paul: 1510167030

Rifah Sanjeeda: 1430084030

Puza Rani Bashak: 1510687030

Section: 41

Group name: Dynamics

Date of submission: 20 April, 2015

Table of Contents

Executive Summary

Company Details

Location

Internal Structure of Company

Product Description and Rationale

Import Details and Cost

SWOT Analysis

Market Analysis

Market Strategies

Pricing and Distribution

Operations

Finance and Funding

Appendix and Reference List

1

2

2

2

3-4

4

5-7

7

8

8-9

10

11-15

16

Executive Summary

Sports are a necessary thing in one’s life to improve and maintain a healthy and balanced life. It helps to keep our body and mind fit and energetic. To do sports, one needs to have some equipment by which a person can do variety of sports. Nowadays, sports equipment is more than a business. It is an effective way to earn profits. The report is about a sports equipment business and it is a small business to earn profits among business partners. Flodora is generally a sports equipment selling business which ensures quality products rather than rejected and bad products in a cheap rate. Flodora strives toward building long-term relationships with our customers and employees. Working within the community, promoting community service, and encouraging the additional education of our employees will be constantly emphasized by store management. We feel that it is extremely important to give back to the community that supports our operations, while also maintaining an atmosphere where our employees have the opportunity to improve as individuals. In the financial projection, net sales increases 9% in the 2nd year and 11% increases 3rd year. In the cost of goods sold, 11% of the price increases in the 2nd year and 14% increases in the 3rd year.

Company Details

The name of our company is FLODORA. Our tagline is “Draw Your Dream in Sports”. It is formed by six members and it is a partnership business. Partnership business is easy to form. Having a partner generally means great financial capability and someone to share in the tasks and decision making of a business. It is even better if partners have varied skills.

Mission statement: Our mission is to be the number one sports retailer shop in the Bangladesh after 2-3 years and we will try to give every type of facilities to the consumer.

Vision Statement: Our vision is to get the worldwide recognition after 3-4 years. We will also provide our own product quality. We will create good value to the consumer and increase our amount of profit. We will also make a factory in our country and export products in the foreign country.

Goal: Our goal is to satisfy customers what they actually need and ensure greater qualities with validity.

Location

The name of our shop is Flodora. It is located in 54/55 stadium market, Gulistan, the busy area of Dhaka city in Bangladesh.

Internal Structure of Company

The number of top–management individuals in our shop is six. There are three employees in our shop. Salary range for each employee is 10,000 taka. As we are the top management individuals, we will take the profit within 2-3 years. After 2-3 years, we will share the 10% profit each.

Product Description and Rationale

Our product:

Cricket bats, balls, gloves, stamps, pad, hale mates & guards: People of Bangladesh likes cricket very much. As Bangladesh cricket team is playing well nowadays, its popularity is increasing. We can earn more profits from these products as people are buying these products very much.

Football: Football hasn’t got so much popularity in Bangladesh as cricket has. But in the time of FIFA world cup, its demand increases. People like to buy footballs at that time.

Badminton Rackets, shuttlecocks, nets: Badminton is played more in winter than the other seasons. In winter, young generations buy rackets, shuttlecocks to play badminton.

Basketballs, baskets: Basketballs are played in different schools and colleges. Some students want to play basketballs in their schools and colleges. We are providing this product for them.

Chessboard, chess: There are many people who always want to improve their skill. Playing chess is a great way to do that. For them we are providing this product.

Tennis ball, tennis bat: When students of schools, colleges and universities get time, they play table tennis to pass their time. Though it is not a part of big games like cricket, football, they like it.

Spike shoes, boots, keds: Shoes are really important for everyone’s life. Young generations like stylish sports shoes than the normal shoes. As we are providing stylish shoes and keds, we hope that our products will be sold more than the others.

Tracksuits, jerseys, sport append: When a cricket or football match starts in Bangladesh, people like to wear jerseys to support their team. That’s why the demand of jerseys is many.

Difference from other products:

In our sports shop, we are giving the developed and better product than the other shops. When customers will want something different, we will try to give them. But if we are unable to give them, we will import the products from outside the country and give the products to them within 7 days.

Unique selling points:

We will give home delivery. When someone will order for any products from or shop, we will give the products to them by going their home and we will take a very low charge for that.

Another way of our selling point is through wholesale. When a company or shop will want products from us, we will give them the products by importing.

Benefits:

Nowadays, customers like new products. When they see any new shop, they always go to see what are there in the shop. As we are new to business, we will have new and good products.

We will have a good value of our products. This will help us to get customers.

Features:

We will take loan from a bank and use our products to manufacture our business. We are hoping for a good business and so we will manufacture our products.

Weakness:

We will have a very low space at first. At that time we will have to face little problem.

Our profit and market share is very low.

Import Details and Cost

Expected level after 1 year:

As we are new to business, we have to face some problems at the beginning. But our expectation is, after 1 or 2 years, we will establish our brand. If we can establish our brand, we will reduce some of our problems. In Bangladesh, there are many established brand shops like Addidas, Nike and Reebok etc. Our target is to be the no. 1 brand like them. After being no. 1, we will be very famous. People will start to like our product. This will automatically increase our profit level.

SWOT Analysis

SWOT

Analysis

Weakness:

1. The limited space

2. The challenges imposed by the current market situation

3. Limited profit

Strength:

1. High quality and reasonably priced product

2. Provide more demandable product

3. Make with decisions and implement

Threats:

1. Continuing challenges faced by the sports equipment industry

2. Political Instability

3. Huge competition

Opportunity:

1. Capture Target Market

2. Strategic location

Strength:

High quality and reasonably priced product: We provide high quality and reasonably priced product for our consumer. We capture consumer to our products in this quality and our reasonable price.

Provide more demandable product: The demand for a product quality is that buyers will be willing to purchase at a given price.

Make with decisions and implement: We make decisions and implement strategies to talk each of our partners and co workers and this is our strength.

Weakness:

The limited space: The limited space of our sports work shop is a weakness of our shop.

The challenges imposed by the current market situation: As we are new to business, we have to face many challenges that imposed by the current market situation.

Limited profit: Other companies have a lot of profit and market share, but the profit of our company is very limited and this is the major weakness of our company.

Opportunity:

Capture Target Market: We can capture market easily. We should open branches there and we can offer the best product to consumer. Our shop can be popular in this market.

Strategic location: Location is the main thing of this business. If we can build up our shop in a perfect strategic location it could be one of the most popular shops in our country.

Threats:

Continuing challenges faced by the sports equipment industry: we faced many challenges that create by the sports equipment industry. Sports equipment industry increased their sports equipment price .that’s why we faced these challenges.

Political Instability: political and economical problem are the main threat in our business. Trade embargoes political unrest and many other things are the threat in our business.

Huge competition: Huge competition is another threat for our company. Opposition company offer better and demandable product and often they offer many discounts to capture markets.

Market Analysis

There are many people who want to play games. Nowadays, games are getting much popular in the world. Some people take it professional and some take only for enjoyment. Now we can find many interested people in this site. So we think, nowadays it is one of the best business plan.

Target Market: Our target is to establish our brand in our country. First of all, our target market is adults and children. Children like to play with different types of sports equipments. Adults buy that for them. Nowadays, women also play different types of games. So we are targeting women besides men. We will provide our products in summer and winter. We will keep indoor and outdoor games.

Potential Customers: Our potential customers are young generations who are interested in sports and sports equipment.

Attracting New Customers: We will attract new customers by giving discounts of our products.

Customer’s Benefits: We will give offers and discounts to the customers. Our customers can buy our product in a small amount. They will get the best product with warranty such as – if we sell a cricket bat, we will give 6 months guarantee. For selling our products more, sometimes we will give different offers like buy one, get one free.

Market Size and Trends: Nowadays, sports equipment market size has not extended so much. But we are thinking that in future, our market size in sports equipment will extend in our country.

Marketing Strategies

Promote:

Firstly, we can invite our friends, relatives and neighbor to visit our shops, so that they can introduce with our products and thus this process, they are willing to buy our products and they tell their friends, parents and relatives to buy our products. Through this process we can promote our business.

Secondly, we will sponsor our product through the Indoor Cricket League of Bangladesh.

Finally, we can promote our business through various advertisement strategies. We can advertise our sports equipment/products through trade magazines, newspapers etc.

Marketing process: We will conduct our marketing activities through television, newspaper & attractive offers.

Firstly, we will advertise our product in some newspapers such as The Prothom Alo, The Ittefaq, The Bangladesh Protidin, The Daily Star, The Independent etc. People will know about our product in newspapers.

Secondly, we will show our product in television. In different channels, we will show add of our product. With this add, people will be able to know about our product.

Thirdly, we will give different types of attractive offers. Nowadays, people look for various offers. We will give the offer Buy 1, get 1 free. Then we will give the discount.

Pricing and Distribution

Distribution methods: Distribution process is very important for any kind of business. Generally, distribution strategy, deals with the marketing activities and institutions involved in getting the right good or service to the firm’s customers.

Distribution channels are the paths that products and legal ownership of them - follow from producer to consumer or business user. They are the means by which all organizations distribute their goods and services.

Physical distribution is the actual movement of products from producer to consumer or business users.

As we are conducting a sports equipment store, so firstly we have to decide which strategy will be more convenient for our business. As the amount of invested money is not a huge amount and as we are conducting a retail sports equipment shop so it will be a very good decision for us if we directly sale our products to customers. We know that, in marketing it is called the Distribution channel strategy. This strategy can help us in various ways. So the factors are given below:

If we use this process, we can reduce distribution cost.

As our business is small, so direct selling is very suitable.

As we want to provide the advantage the direct contact with consumers so direct selling process is very suitable.

If we use the number of intermediaries included in a channel increase, we lose a greater percentage of their control over the product and pay more to compensate each participating channel level. So direct selling is very suitable for our business.

We also use online selling process which becomes very popular in the current business world.

So we use direct selling process.

Then we consider customer service. We know that customer service is very important for our business. So we have to be careful about this fact. We consider some factors for our customer service. Their descriptions are given below:

Set up ways to communicate with our customer: Frequent communication with our customers keep us fresh in their minds and lets us pass along important information. Social media is a great way to communicate with our customers on an almost daily basis. We should keep in mind that this works better if we limit how many of our communication are actually advertisement.

Consider different payment plans: We consider different payment plans. We always ensure a fair price of our every product so that they can purchase our product happily. Every customer remembers the shop when they are treated well and poorly. In either case, they usually tell their friends and family and that can either mean more business for us.

Provide one account service and after selling facilities: Those customers who buy a huge amount of equipment, we give them opportunity to buy our products on account. Sometimes we give them discount. If there is any problem in our any product, we provide our customers the opportunities to re- exchange or repair the product.

Operations

Location of Business: We are choosing Gulistan for our business. Gulistan is a busy area of Dhaka city. Several stadiums are here. For this people like to go there to buy sports equipments. There are also many sports shop for which we can give a good competition over there.

The factors we looked at while deciding on a location of operation:

Location is a very important factor for our business. So, we must figure out how location will contribute to success of our business and we have to choose a location accordingly. As we conduct a sports equipment shop, we must be attentive some factors for choosing a location of our business. The facts are given below:

Customer convenience: First, we need to identify who our customer and how we can best meet of our needs. As we are conducting sports equipment shop, our shop must be convenient to the customer. The location must be easily accessible and provide the customer with a feeling of safety upon their arrival and exit.

Parking: Ample parking is important for customers and other business related people. If customers are unable to find suitable parking, they might choose to a competitor who has the same qualified services with more convenient parking. We also need adequate space for other business related people to park at or near our location. So we have to consider this issue.

Service and Sale: Our business service and sales opportunities are greatly affected by our location. Our selected location should center on our target customers and should generate walk in traffic.

Competitors’ location: As our business is sports related shop, we have to decide a location where these types of business are formed. If we can establish our shop in this area we can easily compete with our competitors.

Rent: As our shop is retail shop so we have to consider this factor. We decide that we will establish our shop in market. We know it very well that the rent cost of this place is very high though we hope that.

Required Equipment: Besides the sports equipments, we need some more equipment which is very important for our business. Proper planning is one of them. Without a proper planning, we cannot do a good business. Besides that, we need capital, employees, top executive managers and motivation to employees.

Projected Financial Statements

Start up expense:

Purpose Period Items Total CostRent Advance for 6 months 6,00,000Insurance 1 year 1,55,000Legal Fees 1,20,000Security 5,00,000Advertising 7,50,000Others 50,000Total expense 21,75,000

Start up assets:

Purpose Total CostCash at bank 20,00,000Big. Inventory 100,00,000Computer 1,00,000Decoration 10,50,000Others 3,50,000Total Assets 1,35,00,000

Total requirement = 21, 75, 000 + 1, 35, 00, 000

= 1, 56, 75, 000

Source of the start-up capital:

Details AmountEvery member contributed 25 lakhs BDT

(6 x 2500000) 1,50,00,000Angel Investor 6,75,000

Total 1,56,75,000

A cash flow forecast:

Fixed cost (Per Year):

Variable cost (per year):

Purpose Total costSalary (3 Stuffs)

Rent

3,60,000

12,00,000

Total 15,60,000

Revenue (Per year):

Everyday goods worth of 43,000 Tk will be sold

So, yearly revenue = 43,000 x 313

= 1, 34, 59, 000

[Note: 52 days are holy day]

A sales forecast for the fiscal year:

Description Total costGoods 100,00,000Electric Bill 51,400Inwards transportation(2 caver van)

30,000

Out wards 20,000Staffs commission 2,40,000Total 103,41,400

Description Year 1 Year 2 Year 3Sales Revenue

Less: sales Discount

1,38,28,990

3,14,390

1,54,77,400

4,15,000

1,76,90,000

5,18,300

Less: sales returns and allowance 55,600 62,400 71,700

Net sales 134,59,000 150,00,000 171,00,000

A projected profit and loss report for the fiscal year of 2015, 2016, 2017:

Projected profit and loss account for the year ended December 31, 2015- 2017:

Taxation

Description Year 1 Year 2 Year 3Balance B/D+ net sales revenue

-134,59,000

7,90,100150,00,000

20,14,240 171,00,000

(-)salary134,59,000 3,60,000

157,90,100 3,60,000

191,14,240 3,60,000

(-)Electricity bill130,99,000 51,400

154,30,100 52,300

187,54,240 53,300

(-)rent130,47,600 12,00,000

153,77,800 12,00,000

187,00,940 12,00,000

(-)cost of goods118,47,600100,00,000

141,77,800109,00,000

175,00,940121,00,000

(-) Insurance Expense 18,47,600 1,55,000

32,77,800 1,55,000

54,00,940 1,55,000

(-) Legal Fee

16,92,600

1,20,000

31,22,800

-

52,45,940

-

(-) Advertising Expenses 15,72,600 2,50,000

31,22,800 2,50,000

52,45,940 2,50,000

(-) Other Expenses 13,22,600 50,000

28,72,800 55,000

49,95,940 60,000

(-) Staff Commission 12,72,600 2,40,000

28,17,800 2,40,000

49,35,940 2,40,000

(-) Carriage Inward

10,32,600

30,000

25,77,800

35,000

46,95,940

40,000

(-) Carriage Outward

10,02,600

20,000

25,42,800 25,000

46,55,940

30,000

Net profit Before Tax

(-) tax@20%

9,82,600

1,96,520

25,17,800

5,03,560

46,25,940

9,25,188

Net profit after Tax 7,90,100 20,14,240 37,00,752

Import Tax:

Appendix & Reference List

http://www.mplans.com/sports_equipment_marketing_plan/situation_analysis_fc.php

http://www.bplans.com/sporting_goods_retail_store_business_plan/

market_analysis_summary_fc.php

Tax Description BalanceImport 86,95,652

Add: vat 15% 13,04,348Total 100,00,000