Business Plan All in One Sports Goods store in Hyderabad
1.Introduction
Nowadays, the competition level is one the top that create the issue for the firm to get the success in the market and to target the customer base. It is because due to increasing level of the competition, there are different firms are available in the market that provide the different products in different range for the customers.
So, customers now have various options to buy the products that became a serious issue for the firms to sustain the market and to develop a good base of the customers. In order to overcome these issues and to perform well in the market, firms are using different ways and the techniques that assist the firm to manage the business and the customer base as well.
In this, keep the price low, provide the quality in the products, provide different offers, etc are the major effective ways that are used by the firms and help the firm to have the consistency in the business.
However, these are the effective ways and help the firms to sustain in the competitive market but at the same time, there are also different issues and the challenges that are also faced by the firms in the use of these ways (Amin et al., 2011). So, for managing the all issues, there are also different techniques that are also used by the firm.
Furthermore, by cornering the all business aspects and the challenges, this business plan is designed and the main purpose of this report is to develop an effective business plan for establishing a sport business in Hyderabad, India.
For establishing a sport business, in India, there is a high need to analysis the market, business opportunity and customer’s requirements for the sports products.
The sport retail store will offer high quality of sport products for targeting the sport professionals, youth and small kids. The target market of the sport retail company will be Hyderabad and other states in India.However, India is a home country in respect to that I decided to open the sport retail store in Hyderabad.
This business plan will be prepared by conducting a proper market research for which proper survey will be conducted in order to identify the customer’s needs or requirements for the branded sports products (ANDREI et al., 2014).
In this business plan, different aspects are analyzed in-depth such as business opportunities, vision and mission. In addition, this planwill also be analyzing the sport market of India for which SWOT, PESTEL and porter’s five forces analysis will be conducted.
Moreover, this plan will also focus on developing an effective marketing plan in which different aspects will be determined such as target strategy, market segmentation and market positioning.
This study also outlined on developing an operational plan in which business location, products and services, organization structure and licensing requirements will be defined. This overall business plan will reflect the clear picture related to business establishment to business growth and development successfully in next five years.
2.1 The proposed business Opportunity
There are different sues related to the health that are being faced by the people in today’s environment. There are various reason behind the facing the different issues in this, pollution, high use of unhealthy products, etc.
So, in order to manage the health and to live a happy life, most of the people are looking towards the sport goods. Due to this, this business plan is designed and in this, it can be determined that Sport Retail Company has an opportunity to target the Indian market by opening the all-in-one sports goods store in Hyderabad.
In India, it is analyzed that customers are getting more concerned towards their health and developing more knowledge for different sport games (Ashdown, and Loker, 2010). For company, it is biggest opportunity to target the school kids and youths by encouraging their interest towards using the sports goods which make them feel relax, refresh their mind or comfortable.
The business opportunities also involves target market in which company will offers its products and services for satisfying the customer services to a large extent.
There are different products that are available in the market and helpful to meet the need of the customers but at the same time, the market of sport products is very low and limited. It is because the major focus of the firms is to provide the fast food and other consumption product bur there is no high demand of the sports goods (Mittal et al., 2012). So, due to this, it can be determined that provide the sport good for the customer can be a good advantage for the firm.
The company will sell the latest and best quality of branded sporting goods, apparel and accessories. The sport products will be purchased from the top manufacturer worldwide such as Wilson, Miken, Jugs, Easton, Bike and many more.
There is a list of products that will be initially offered to the customers at store such as baseball equipment, football, cricket, table tennis, golf, etc. Moreover, when company will establish it successfully then in future, it will offer the more products like wrestling, swimming, running, etc.
The store staff will also be trained and educated in efficient manner that they are able to convince and motivate the players or customer to develop their interest in sports and purchase best quality of products for achieving it. These all above stated sport products will be marketed in the current and growing market of Hyderabad attractively and efficiently.
In order to get the success in the market, there are some unique mission that are made by the firms and for archive that mission, firms utilizes its all resources. Formulate a good mission makes also easy to the firm to perform better and to develop a good business value.
So, in the same concern of this, the mission of the sport retail company is to become the one biggest sport equipment retailer in India by supplying the sports goods and providing customers with reasonable price and a best quality of product for developing a long term relationship with our customers (Monk, and Wagner, 2012). In addition, the company will focus on promoting the lifelong enjoyment and interest for the sport.
The vision of the firms defines the success of the firm and also increases the working performance of the firm as well. So, in the concern of this business plan, the vision of the firm will be to develop the core value of discipline, motivation, respect, safety, teamwork and integrity.
- To become a leading market player by targeting the large market share in next five years in India.
- To increase the profit in same year by 5%.
- To provide the customers with best quality of sports products at a reasonable rate
- Develop a strong relationship with the customers such as sports professionals and youth
- To provide the timely training to staff regarding awareness of sports products.
The situational analysis plays a crucial role for identifying the Micro and Macro factor that can impact the business plan. The analysis of internal and external market is important because it helps to attain the right customers, identify competitors and estimate the market trends and use such information for building the best strategy for the sport company that wants to become the all in one sports goods store in Hyderabad.
In order to analyse the Macro market environment, the PESTEL and SWOT will be undertaken and Porter five forces model would also study for analysing the industry (Amin et al., 2011).
It is a medium of the internal analysis of the firm and in this; there are four things that are stands such as strength, weakness, opportunities and the threats. So, through the SWOT analysis, it is easy for the firms to know their strength, opportunities in the market as well as the weakness and the threats.
In the concern of this Sport Retail Company, below is the table of SWOT analysis.
| Strength
· High quality · Refreshing and new offering · Available at affordable price |
Weakness
· Less practical experience in this field · Use of less promotional tools (Yuan, 2013) |
| Opportunity
· Increases awareness of the sports · Willing to pay for the sports equipments |
Threats
· Increase in competition · Change in customer behaviour & preferences |
From the above SWOT analysis, it can be determined that the major strengths of the firms are providing the high quality in the products, provide new offers and the affordable price of the all products.
These all strengths of the firm will be helpful for the firm to get the competitive advantage and to perform well in the competitive market (Rossberger, and Fiedler, 2014). From the above analysis, it can also be determined that due to good strengths in the market; there are different business opportunities for the firm in the market, in this, increases awareness of the sports, willing to pay for the sports equipments, etc.
However, there is various market opportunities for the firm in the market but at the same time, there are also some weakness such as less practical experience in this field and the lack use of the promotional tools, etc. Along with this, some of threats are also there such as increasing the competition, customer behavior and the preferences, etc that can create the issue for the firm to successful managing the business and to perform well in the market.
It is one of the major tools of doing the external analysis of the market that help the firm to get the idea about the factors that affect the market and the business position of the firm. In like manner, PESTEL stands for Political, social, environmental, technological, economical, and the legal.
Below is the PESTEL analysis of India that will help the firm to perform better and to formulate the business strategies by considering the different factors (Rajasekar, and Al Raee, 2013).
| Political environment | The business environment of India is largely affected by the political factors in the form of changes in government policy as per the politician’s interest. But, the taxation system is well designed and controlled by the union government. On the basis of this study, sport company can implement the business in the Hyderabad market by taking tax benefits. |
| India has stable economy and it also provide support to the foreign and local company investment through the simpler policy. This practice will help the sport companies to get various opportunities with the implement of sports store in Hyderabad market (Srdjevic et al., 2012). | Economic factor |
| Social factor | The rise in India Youngest population result in increase the demand of sports equipments (Yüksel, 2012). This growing craze of youth will help to increase the sales of sport company. |
| India has strongest IT sector so in that case country will help the sport company to adopt the advanced technology. This practice will help in reducing maximum cost and incorporate the quality in product. | Technological factor |
| Environmental factor | In context to environment, India industries focus more on the sustainable practices. In regards to this, the sport company need to follow this strategy for sustaining long-term in this competitive business environment. |
| There are number of legal changes have been implemented in India such as recycling, minimum wage and disability discrimination. The legal regulation directly influences the business operations (ANDREI and PRISECARU, 2014). This legal regulation helps the sport store to successfully open the business in a systematic manner by not facing any type of unethical issues. | Legal factor |
5.2.3 Porter Five Forces Model
It is one of the effective models that is used by the firms to analysis the Industry trend and the market. It is because for successful development of the new market, it is quite necessary for the firms to analysis the industry and to have good information about the industry development and the market.
Because of this concern, the porters five force model is used by the firms. There are five factors such as rivalry among competing firms, entry of new competitors, substitute products and services, bargaining power of suppliers, and bargaining power of buyer.
Rivalry among competing firms: there high competition exists in the Indian sports market. Nike, Adidas, Puma and Fila are rivals in the sports equipment (Rajasekar and Al Raee, 2013). In concern to this, the sport stores need to anticipate the moves of its competitors. This practice will help the store to bring improvement in a continuous manner.
Substitute products and services: – There is moderate substituent of sports product. This gives opportunity to the sports company to develop unique feature in the sports equipments so that target market can be attracted.
Entry of New Competitors: – There is high entry of new competitors. It is identified that foreign investor make more investment in the retail segment like in sports and for the companies, India is the best platform to explore its business. This is because India consists of younger generation and the craze of sports is also increasing among the people so in that case, the chances of growing competition is high (RENKO et al., 2011). In short, this can influences the Sports store if it does not bring something unique in its product line.
Bargaining power of supplier: – The bargaining power of supplier is moderate. Since, there is various sports stores are open in India. The company get less chance to achieve to enjoy high bargaining among customers. This is because if consumer perceives any sport equipment too costly then it has several options to buy the sport from another store house.
Bargaining power of buyer: – There is high bargaining power of buyers due to the existences of high competition in sports sector in the Indian market. However, the growing competition gives high choices to the buyer in terms to choose that product which is affordable and have right quality. This area shows the bargaining power of buyer.
In order to analyze the micro market, there is need to identify the target market, resources, capabilities, current trends of the company. It is because it helps the firm to successful development of the market and to manage the all business effectively.
It also helps to overcome the different issues and the challenges that can be occurred and can affect the market of the firm as well (Schwarz. and Hunter, 2012). It also makes easy the firm to have the better utilization of the resources that helps the firm to get the success and to achieve the all goals and the objectives.
Target Market will be the Hyderabad where sports store targets the different consumers such as sport participation, individuals and online retailers. Thus, the sport store will target the wide market for the product and services. It will give high opportunity to gain the profit and earn maximum revenue.
In the current scenario, the sports value is quite increased due to growing awareness among the people. Now sport is going to be the next big industry in India and currently sports contribute approx. 2 to 4% of total employment. This percentage is increasing yearly to yearly.
On the basis of this study, it can be stated that there is high opportunity for the Indian sport retailers to capture large market as India consist of larger population of youngsters. In context to Sport Company, it would be beneficial if it targets sport participants and individual who wants to make a career in sport field.
At the same time, company also gets a benefit if it supplies to the online retailers. Thus, this target market strategy proves to be useful for the sport company in terms to capture the Hyderabad market.
5.3.2 Resources & Capabilities
There are various resources available for the sport store in Hyderabad. However, Human, physical and technical is the resources which are required to carry out the business operations.
Human resources: The skilled workforces are available in the Hyderabad. This would help the sport store to hire the talent staff for performing the operations (Schwarz et al., 2015).
Technical Resources: Since India is well equip in the technology system. So, this will contribute towards the supporting of sport store in Hyderabad. The use of technology will help the store to bring improvement in customer service and reduce the maximum expenses of operations.
Physical resources: the supply chain of sport equipment is quite strong. This will help the sport store to timely availability of equipment. It results in the form of high revenue.
Hence, these resources will increase the capability of the sport store and allows achieving the success in Indian market.
The most important element in starting a business is funding. Even the most basic home business incurs a multitude of startup costs, including registering a business name, obtaining a business telephone line and printing business cards.
Financial resources can be obtained from a variety of sources, the easiest being from the personal accounts of the company’s founder. Alternatively, loans and lines of credit may be granted from financial institutions, friends and relatives, private investors and even the United States government.
In addition, many grants are offered from private and public sources to entrepreneurs of all demographics and personal situations.
Human Resources
The success of an organization is heavily reliant on the talent and strength of its employees. The hiring of experienced professionals with track records of excellence within their area of expertise ensures that the mission and goals of the company will be carried out efficiently and with competence.
Strong team members can be recruited using a variety of methods. Staffing agencies and executive search firms specialize in placing talent of all levels within every industry. An alternative is to find employees through referrals from individuals whose judgment is trusted.
Educational Resources
Perhaps the greatest thing an entrepreneur can do when establishing a new business is to gain as much education possible. By understanding her competition and gaining an in-depth knowledge of her industry, she will be better prepared to make smarter decisions regarding the direction of her firm.
Educational resources can be found through professional trade associations that are geared toward her industry, her local chamber of commerce as well as the Small Business Administration (Shashina, and Olentsova, 2016).
Physical Resources
Whether a small home business or a retail operation with multiple locations, every organization must have the appropriate physical resources to survive. This includes a proper workspace, working telephone line, adequate information systems and effective marketing materials.
This aspect of business planning can be one of the costliest. As such, it is important for an entrepreneur to realistically assess his needs before making any purchases.
Emotional Resources
Starting a business can be an extremely stressful endeavor for an entrepreneur to undertake. To maintain her sanity as well as stay motivated, it is important she have a support team that can give her inspirations and guidance as needed.
This team may be composed of friends and family as well as a mentor or professional group (Srdjevic et al., 2012).
The sport retail company will use a strategy for providing its customer services to the entire target market. There are different strategy which will be adopted by the sport company for targeting the customers and their requirement on time and satisfactorily.
In respect to this, the target market for sport retail store will be sport professionals, youths and different interested customers in sports and also company will supply its products to different retail stores offline and online.
For establishing and sustaining in this sport industry and to get fit with customer needs and wants for that customized strategy will be used. This strategy will help in customers and provide them with the required customized products in the sports clothing, shoes, or sport equipments.
In addition to this, sales strategy will also support the sport retail shop to increase its sales of branded products and services. For retail sales, the sales managers will have a responsibility to train the sales associates in such a manner that it encourages them to assist customers in making their busying decision quickly and right.
Moreover, the employee of retail shop plays an integral part for the shopping experience for the customers (Yuan, 2013). The sport company will also participate in the sport trade shows in order to understand the market trends as well as to provide the customers with the updated products and services in the market so that customers wants are meet efficiently and effectively.
This sales strategy also helps the company to develop the future sales opportunities for the branded sports products & services.
Moreover, the company strategy will also involve marketing strategy which will be used for targeting the market segment easily in order to increase the sales of the products and services in this competitive industry market (Yüksel, 2012). The marketing strategy of Sport Company is to provide the benefits to the customers by marketing the product on internet and at retail store of the company.
At the time of high competition level in the same products and the same market then firm looks to expand the business at high level that comes in the growth stage. In addition, a growth strategy entails introducing new products or adding new features to existing products.
Sometimes, a small company may be forced to modify or increase its product line to keep up with competitors. Otherwise, customers may start using the new technology of a competitive company. For example, cell phone companies are constantly adding new features or discovering new technology.
Cell phone companies that do not keep up with consumer demand will not stay in business very long (Schwarz, and Hunter, 2012).
A small company may also adopt a growth strategy by finding a new market for its products. Sometimes, companies find new markets for their products by accident.
For example, a small consumer soap manufacturer may discover through marketing research that industrial workers like its products. Hence, in addition to selling soap in retail stores, the company could package the soap in larger containers for factory and plant workers.
6.2 Product Differentiation Strategy
In order to get the competitive advantage and to perform effectively in the market, it is quite necessary for the firms to have some differentiation in the products and the services. The reason in this is that it helps the firms to expand the business and to grab the market opportunities.
Small companies often use a product differentiation strategy when they have a competitive advantage, such as superior quality or service. It is because it helps these firms to expand the business and to increase the customer base. It also helps the firm to develop a good brand image and to enhance the profit of the firm as well (Rossberger, and Fiedler, 2014).
For instance, a small manufacturer or air purifiers may set themselves apart from competitors with their superior engineering design. Obviously, companies use a product differentiation strategy to set themselves apart from key competitors. However, a product differentiation strategy can also help a company build brand loyalty (Schwarz et al., 2015).
It is also one of the effective marketing strategies that are used by the firms to make its unique identity in the market and to target the specific customers. The reason in this is that in the price skimming strategy, firm keep the price of the products high that means the product is unique.
For example, Apple is one of the unique brands and uses the price skimming strategy to target the customers (Mittal et al., 2012). There are some limited customers that are targeted by the firms and that is why price skimming firms always have its unique identity in the market.
A price-skimming strategy involves charging high prices for a product, particularly during the introductory phase. A small company will use a price-skimming strategy to quickly recover its production and advertising costs.
However, there must be something special about the product for consumers to pay the exorbitant price. An example would be the introduction of a new technology. A small company may be the first to introduce a new type of solar panel.
Because the company is the only one selling the product, customers that really want the solar panels may pay the higher price. One disadvantage of a price-skimming is that it tends to attract competition relatively quickly.
Enterprising individuals may see the profits the company is reaping and produce their own products, provided they have the technological know-how (Rajasekar, and Al Raee, 2013).
A small company with extra capital may use an acquisition strategy to gain a competitive advantage. An acquisition strategy entails purchasing another company, or one or more of its product lines. For example, a small grocery retailer on the east coast may purchase a comparable grocery chain in the Midwest to expand its operations.
In order to get the success in the market and to perform well in the new market, there is a need for the firms to formulate the marketing plan effectively. It is because marketing plan helps the firms to get the right decision on right time effectively.
Because of this, there are different ways that are used to formulate the effective marketing plan (WANG, and FANG, 2013). In the concern of Sport Company, it is also needed for the firm to formulate the marketing plan. This firm will also make the plan and formulate plan.
Sports are the booming market in India. Likewise, India is known for the cricket but it’s not only the popular sports. The country sports offers variety and interesting investing opportunities for the companies and small businesses. Thus, the spending on the sport goods allows to get maximum consumer confidence and it result in increase the level of personal disposable income.
The sports market has a high demand in the Indian economy so in that case the awareness level is quite high. Due to this, the marketer does not need to extensively promote the product in front of customers. Since, sports have made its own place in the mind of customers then the sales are expected to grow 2% at an annual compounded rate of 4.8% (Mittal et al., 2012).
The sport goods market will divide into the category of geography, behaviour, participation and demographic. Among this, demographic plays an important role in sport goods sales since population growth and age group distinctly affects the sport participation. In context to this study, the marketers will select the India geography for segmenting and targeting the individuals. However, Hyderabad market will be segmented based on the sports participation, customer type, retail shops etc.
Sports Participation: These customers will have needs based on the specific sports in which they participate. For instance, the hockey player needs for particularly equipments, uniforms as per the hockey sports. Thus, this represents the huge growth opportunity for the sports company as it targets these sports segments.
Customer Type: This segment includes different individuals. Likewise, the individuals who require the sports for participation in games or people that just want sports as per their interest area. These individuals could be the league representatives, independent team coaches, school athletic coaches and directors. Similarly, retailers are also target for the sports. For this, national, metropolitan areas are also targeted (Ashdown, and Loker,, 2010).
7.1.2 Targeting strategy of the company
In regards to targeting the mention segments, the marketers will use promotional tools. These are as follows:-
Online Platform: This is one of the popular ways to inform the target customers about the product. The growing use of digital platform forces the company to follow this strategy. It is identified that the online platform allows the company to address the large market and connect with the audience easily. Likewise, marketer can understand the needs of the people and take help of people in designing any product. This will help in developing healthy relationship. Similarly, this platform will also contribute for the sport goods company in regards to create the website and showcase the sports product by indicating the quality of product. This practice allows the customer to look at design and price of the product (Ashdown and Loker, 2010). In concern to product, if any complaints are occurring then the company can solves it instantly on the online area. Similarly, online merchants and retailers can also make contact with the sport company in regards to make contract for supplying products and services to the retailers.
Sponsorship: Sponsorship is another promotional strategy which proves to be useful for the sport companies to inform about the product to the larger audiences. However, Sports Company can use it through support any sports event in the form of providing the equipment for games. This way, target audience recognizes the brand and product quality. This perception proves to be effective for the company (Amin et al., 2011). Thus, the strategy of sponsorship provides advantage in the form of influencing the larger target audiences and allows the sharing of facts related to products and services to the people. Thus, this strategy would also consider as a suitable one for this study. Therefore, through this manner, the sport company can communicate the product to the target audiences and this will provide higher recognition in market.
Moreover, Sport Company will position itself on the basis of product quality and price between the target markets. This practice will help in achieving higher awareness about the brand.
As per a research, the market of sports goods retail industry has become intensely competitive within few years in India. The prime reason behind growing concern for health as well organization of various sports events such as IPL, Pro-kabbadi etc. Survival and growth in such market is only possible through creativity, customer oriented and proactive service. Hyderabad is a densely populated people with majority of young population. The organization is aware of the retail market of Hyderabad, and will perform in depth research for addressing the competition in an effective manner (Monk, and Wagner, 2012).
The directors of the organization are sports lover themselves, which make them highly committed to this business. Moreover, our store would be able to have sufficient parking space to manage traffic and easy entry and exit of vehicles (Rossberger, and Fiedler, 2014).
The store will also ensure to offer wide range of sporting goods of leading manufacturers. The goal of the organization to provide a place to sport and health cautious people a one stop shop for al sports related needs. Customers would find all leading brands sports product in our store. The store will be an advance one with all facilities like online store, acceptance of all digital payment methods, etc. We would also provide additional discount on consumables items. The list of clients would include schools, colleges, clubs, household etc.
At last, the employees at store will be well trained to handle all queries of the customers. Employees will be paid well to keep them satisfied and motivated. The store executives would be the person who has personal inserts in sports. Also, sports magazines would be made available to employees, so that, they could suggested any improvement in sports industry. A feedback system will be there for knowing the experience of visitors. Also attractive deals will be offered to corporate clients for bulk purchases to maximize the sales.
In the business of sports good there are various key factors making the business a success. One such key factor is personnel. Similar to other industries, employees of any organization are its key assets. It is the employees who procure, performs research, operates counter, sell the product. Thereforesectionof right candidate is extremely crucial for organization. Moreover, in the case of sports goods industry it is recommended that employees having knowledge of sports or sports loving person would find it easy to sale. Also, right employees ensure effective utilization of organizational resources. Hence, it is crucial for any organization to have dependable and intelligent workforce for remaining competitive in the market (Mittal et al., 2012).
Another success factors in sports good industry is effective management at top level. A management which hasclear vision and mission would set correct objectives which will provide clear direction to other employees of the organization. The management must be competent to decide a balanced budget, control expenditure, and motivate employees for maximizing the profit figuresof theorganization,thereby achieving its targets.
One more contributing factor to the success of business in sports goods is relationship with stakeholders. In sports goods business stakeholders includes, sports good manufacturers, financier, distributors etc. Having a string relationship with these stakeholders would help organization in getting best deal as well as performing business smoothly. Store could also entre into partnership with various club houses, gymnasium etc. Collaboration with such clients would directly affect the business as these clients are in direct touch with the users and providesthem service for which sports good required.
Promotional strategies of the organization have major impact on its sales figures. In sports goods business effective promotional strategies would help in effecting the sales. Hoardings around the sports club, sports stadiums, gyms etc. would get maximum attention of targeted segment i.e. sports lovers. Social media’s marketing is a growing trend among youngster. Active presence on social media would help store in promoting products in very cost effective way. Apart from that providing Creating a website and social media account is one key marketing strategy to be used by the organization. Another promotional strategy is celebrity endorsements. For instance, for inauguration of store, any famous personality can be invited, which will also help in media coverage. Similarly, frequent visit of popular sports personality would promote store to a larger extent.
In sports good business, stores are required to have stock of wide range of product. There are various brands in sports industry Like Yonex, Reebok, Puma, Nikle etc. Sportsperson prefer their own brand and mostly are loyal towards their brand. Hence, store requiresto have all popular brand products for meet the requirement of customers. The store must also provide Taylor made product basedon the requirement of their client.
The location of the store is also a vital factor for sports business. Hyderabad is a populated city and selecting a place with sufficient parking, easy access, close to clubs, sports stadium would directly affect the business.
| Segmentation | Geographical, behavioural basis
· India (Hyderabad) · Different customer type like sports participation and individuals.
|
| Targeting | · Sports Participation
· Customer Types · Retail/ Online |
| Positioning | · Product quality
· Price On the basis of both the factors, company/brand will position itself in the market. |
The store will select marketing strategies which will not only beneficial to owner but also to customers. There will be a synchronization as well as integration of internet marketing and retail marketing.
We are planning for establishment of a coherent as well as consistent marketing plan and will consider in the way to utilize almost all efficient forms of advertising, promotion and more tools of marketing. Particular techniques which will possibly be considered are:
- Print/ Newspaper Advertisements –In order to make store’s name in the mind of customers, there is need to advertise store’s name and objective through newspaper and print media. The plan is to post advertisement in local newspapers for informing consumers about location of the store and contact information. There is also plan to publish introductory coupons as incentive to first visitors to make them visit the store and make a purchase. Beside this, local sports magazines will also be used for advertising the store.
- Press Releases – Local newspaper in Hyderabad has column for new openings in city. All attempts will be made for getting coverage in that section. Also, the opening will be grand which increases the scope of media coverage at local level.
- Tournament/ Team Sponsorship – The store would actively participate in sports event. Sponsoring league and local teams will also be used for promotion by way of making available sports uniform and equipment rather than cash. All these activities will also be covered at our website.
- Event Sponsorship– All opportunities will be investigated to organization sports events, mainly those events which are managed by local bodies like organizing marathon, swimming competition etc.
- Decals/ Stickers – The store will have a logo. Stickers/ decals will be attached to all the orders dispatched. Logo would help in brand building and making store more popular (Ashdown, and Loker, 2010).
- Apparel – The staff at the store will wear T-shirts having out logo printed on it. Beside this hats will also be distributed during events having out logo printed at forehead side.
- Grand Opening –In promotion of a store, its opening must be grand as much as possible. With the support of distributors and manufacturers, various prizes could be distributed during inauguration. At beginning, the price of consumable products will be kept minimum for increasing traffic in store. Such loss will get covered by cross selling of other profitable products. Store inauguration by local celebrity would bring more customers to the store and would also help in media coverage (WANG, and FANG, 2013). To make the opening grand a series of small events will be planned like demonstrations, sports competition, free prizes based on registration for making customers familiar with the store.
- Trade Shows – Trade shows within the industry will be attended by our organization to gain knowledge of new trends and products. Through this, sound relationship could be maintained with suppliers.
- Word of Mouth – With great service to first time visitors and attractive price, publicity through words could be expected. Also, the various partnership with clubs would help is getting maximum word of mouth publicity.
- Yellow Pages– content details of our store will be advertised in yellow pages and other business telephone directories.
- Flyers– Distribution of flyers will be done at all major seasonal leagues. Those flyers will provide attractive discounts at stores as well as online shop. The discount might be divided between customers and non-profit organization the league (Srdjevic et al., 2012).
- MailBox Flyers– Opportunities will be explored for distributing flyers to local nearby areas mailboxes.
- Discount Cardprogram- A discount card program will be started for attracting customers to make repeated purchase from the store. Reference bonus programs will also be there for providing excited discount for every successful purchase made by your referral. Data collected through discount card program or referral programs would help in using email service to inform about new discount coupons and new arrivals in the store (Yüksel, 2012).
- Business Networking– Business networking firm like linkedIn etc. will be used for creating awareness about the store.
- Direct Mail– Direct mail will be sent for promoting the store.
- Radio– In Hyderabad, radio is a powerful medium of advertisement. Sports people usually love listening radio to get relax and have a break. Opportunities will be explored in this area also.
- Catalog– Effectiveness of designing catalog will be explored based on requirements.
- Web Marketing– Different channels of web marketing channels will be explored and will be tested.
- Articles, Press releases, articles, or /and advertisement on other local internet sites.
- Marketing through search engine
- Banner Advertisements
- URL Links from/ to teams, company’s co-marketers, leagues.
- Marketing through E-mail
- simple questions with daily winners
- Events at store and its schedule
- Non-Profit Relationship(s)– The store has planned to be a permanent sponsor of minimum one nonprofit organization and develop sound relationship with it. Sponsoring of sports events for raising funds for the associated nonprofit organization and sharing a fixed profit percentage for specific promotional events organized for such organization. The store believes in paying back to community and this will also attract free publicity which is crucial for the business (RENKO et al., 2011). Media is also interest in social aspects of business and our store will be actively involved in that.
All the decisions regarding marketing such as selection of media channel, frequency of advertisement, size of advertisement, associated expenditure will be considered on continuous basis. Evaluation of all alternatives will be done for future learning and doing justification with investment.
Red Roaster is required to formulate effective and effective marketing mix strategies for commencing its business in Pakistan. The marketing mix will comprise price mix, product mix, place mix as well as promotion mix of its goods and brands.
Company is required to extend its product portfolio to include more sports product varies depending on requirements and preference of local people. For that, organization is required to perform detailed market research for generating information regarding preferences and choices of local consumers and retail sports product which could fulfill requirement and reason to buy. In addition to that, company is also required to ensure confirmation of quality aspect for its new products to meet local government requirements. Moreover, the physical aspect is also important in the business. Hence, company is required to furnish and decorate its sports product houses in a manner to attract local consumers. For that cultural aspect is also required to be understood by company for getting attention of people. Organization must also include seasonal offering during festivals like Ramzaan. A well designed product mix will help the organization is creating a difference in the market and provide an edge over competitors (Schwarz et al., 2015).
Company is required to set its price competitive for reducing the effect of competition as well as to overcome the fear of economic recession within the nation. Further company might also include premium products in its list for satisfying needs of upper class. The strategy will help in attracting people from all social classes. Pricing strategy is crucial for company as it directly affect the profit margin of the company (Rossberger, and Fiedler, 2014). But, with effective pricing strategies companies can effectively counter the economic recession risk and manage the purchasing power of buyers.
The place mix strategies would help the store in establishing its sports product chain in different parts of the country. The store must be opened in widely populated areas, such as close to colleges, schools, malls, cinemas, offices etc. Apart from that, the layout must be planned in a way to offer easy entry-exit to customers (Rajasekar, and Al Raee, 2013). The business is also required to train its employees to property serve its customers for creating brand image of the organization. The location of café must be such that, that people will find it easily accessible. Company can enter in associations for commencing new stores in populated areas to target mass customers.
The promotional mix of the company use include direct, print, and social media marketing strategies for making customer aware of the brand. For that company can advertise its product in newspaper, television, through social media, websites, personal selling for communicating with customers. Also, can include discount coupons, and run program of reference to promote its brand. For targeting youths, company must use social media and obtain feedback about its products as well as services. The store could also use hoardings for promoting the brand in local markets. The employees working in the store must be properly dressed up and trained to greet customers whenever they visit (Yuan, 2013). The positive experience of customers will help in getting repeat orders as well as word of mouth publicity.
7.7 Implementation and Control
Implementation and control mechanism will make sure that strategies have been executed properly. Any deviations from set target would require corrective and immediate measure. All activities like inventory control, procurement procedure, distribution channel etc. will be monitored closely. Also, customer satisfaction as well as employee satisfaction will be assed at regular intervals.
7.7.1 Control
For controlling the operations store will decided some key performance indicators (KPI). Some of the KPI for the proposed business will be market share, sales growth; return on investment etc. will be assessed monthly, quarterly for responding to changing market situation.
The measurement of revenue of store would help in assessing the growth of business, moreover if it is decreasing than reasons for the same will be explored. Measuring sales growth would indicate that whether new strategies are required or not (Shashina, and Olentsova, 2016). Measurement of market share would help in assessing competitors’ performance and forecasting future of the organization as well as market potential. For instance, reducing own share but increasing competitors share denotes that market is full of performance but own organization is performing low. Return on investment will help in measuring the effective use of resources. The analysis will include calculation of various financial ratios for measuring the overall performance of the firm.
The operational plan of the company will offer high-quality products at reasonable price to attract the customers of overall India. The target customers of the company are all the sports-persons and some organization’s who organize sports. For example- Individual participants are those customers who are the actual sports participant and parents also purchase sporting goods for the 5-18 year child. In addition, the other customers are league representative, independent team coaches, school athletic directors & coaches and sports performance businesses (Schwarz and Hunter, 2012). This operational plan is most important for the business plan to provide effective management and leadership of the business.
The Organizational and operational plan describes how you will structure your company and how you will carry out everything you present elsewhere in your business plan. Without an execution strategy, the rest of your plan is meaningless.
Like the Marketing Plan, your Operational Plan is essential to the success of your business. It will be important not just to would-be lenders and investors, but also to you, to management and to your employees. You can’t take for granted that anyone, including you, understands exactly how to run your business on a day-to-day basis unless you’ve thought it through and made your expectations clear. A key difference between an Operational Plan you would prepare for internal use and one you will give to potential lenders and investors is that you do not need as much detail in the latter.
Here are the key components to address in an operations plan that will be used externally.
In the business description, you provided the address where your business will be (or already is) located. If you have a retail location, describe the surrounding area and explain what makes this location effective. For example, you might be located on a major road that people drive on the way home from work, making it convenient for them to pick up groceries or a hot prepared meal on the way home. If your business only has an online presence – perhaps you run a service that dispatches independent contractors to clean homes – explain who operates the website and handles customer service, from where and why that arrangement makes sense. Also describe where your contractors live and how quickly they can reach your customers.
Note any disadvantages or possible problems presented by your location and what, if anything, you have done or will do to counteract these negatives. Does traffic back up so badly on the road where your store is located that cars struggle to exit the parking lot during rush hour? Do you have enough parking spaces to handle peak volume? For an online business that uses independent contractors, what are the drawbacks associated with not having all your employees operating from a single location? What are the advantages?
The firm will be set-up the business in Hyderabad, India to provide best quality sporting products to the customer. In the start-up, the company will need a minimum share capital INR 5,000,000 to operate the business in an effective manner. This amount will be collected by the company by issuing the share and contribution of the shareholder’s fund (Schwarz et al., 2015). The success of the business is based on the capital, strategy, and organizational people.
8.2. Management and organization
Management can be described as the people who design an organization’s structure and determine how different aspects of the organization will interact. When designing an organization, managers must consider characteristics such as simplicity, flexibility, reliability, economy, and acceptability. Different levels of management will participate in different components of this design process, with upper management creating the initial organizational architecture and structure.
Organizational design is largely a function based on systems thinking. Systems thinking involves identifying the moving parts within an organization that add value and ensuring that these parts function together as an effective and efficient whole. Perspective is essential in systems thinking: a manager’s role in organizational design is to refrain from thinking of departments, individuals, processes, and problems as separate from the system and instead think of them as indivisible components of the broader organizational process.
Modern organizations exist within a framework of globalization and constant technological disruptions; as a result their organizational design is less static than in the past. Management must actively adapt organizations to meet various challenges, opportunities, and technological improvements to maintain competitive output. Because the organization is always changing, the problems of process and design are essentially limitless. Using a systems approach, managers view their objectives as moving targets and actively engage in expanding the organization day by day
The organization will newly start-up and will develop the organizational structure as below:
- Company
- CEO and marketing head
- Directors and managers
- Sales and marketing staff
- On-site manager
- Full time and part time staff
- Other consultants
The administration department will handle different obligations like reporting, bookkeeping, inventory, ordering and renewals of bureaucracy. Additionally, it will have the responsibility to pay the employees, suppliers, and owners (Monk and Wagner, 2012). In addition to this, the management will also handle performance review, development of strategy, reporting reviews, design the employee training, develop the relations with suppliers, etc.
In addition to this, the organization will also include the suppliers and investors in the operational plan. In this company, the suppliers for the sporting goods can be identified online by the company where the comparison is also available. The suppliers will provide raw material to manufacture the product in the organization (Shashina and Olentsova, 2016). For this, the company will establish a long-term relationship with the supplier to get the raw material at low cost. Some of the important suppliers in the international market are Easton, Playmaker, TrueSports, Louisville Slugger, Under Armour, Jugs, Wilson, Worth, Mizuno, Miken, Adams, ATEC, Bike, etc.
The company will have an on-site manufacturing plant where it will provide finish goods and products of different games like football, cricket, baseball, basketball, golf, volleyball, softball equipment, etc. All the products will need a different kind of raw material products like material of HDPE material, iron, high-quality woods, chemical, etc. During the Commonwealth and other sports competition, the demand for sporting goods may increase so that the company will be sstocked (WANG and FANG, 2013). Additionally, in the summer vacations of students, the demand for sports product may also increase.
In order to establish the sport goods store, there are different licenses and legal requirement which are required to be fulfilled by the organization. For opening a business, there is requirement of legal formalities which need to be considered by the organization such as register the company in the Companies Act, 2013. In addition to this, for importing the products and services from different countries, there is also need to do proper legal formality like import license will be issued by the government of country in order to avoid any future conflicts or threats.
If company need to sell the foreign sports brand for that proper brand franchise license will also be undertaken so that customer in Indian market can also get a branded and best quality of sports products which help them to achieve their sport goals efficiently. The state and federal license, local authorities permission is also required o open a business in the competitive market because this permission will eliminate any future government illegal authority issues or challenges. Moreover, all types of entities and individuals require a register themselves under the GST Act. Similarly, while establishing the business of sports goods, the GST registration is very important legal formality which needs to be fulfilled within the 30 days of opening a business.
However, Sports good store organization need to maintain all records related to legal documents so that business operate successfully without any certain future risk or threats.
The products of the company will be prepared in the factory where different kinds, size, style, designs of sporting goods will be manufactured. In which, the company will focus highly on the quality control and product development to provide effective development in future (Rossberger, and Fiedler, 2014). In the starting, softball, and baseball will be introduced in the market and after making the brand image in the market several products will be introduced like volleyball, basketball, football, net, sporting uniforms, bags, caps, Footballs Shoulder Pads, Cricket Pads, Thigh pads, Helmets, etc. After the internationalization of the company, the company also have the plan to introduce some precuts for future such as Swimming, Tennis, Wrestling, Running related products.
All-In-One Good business store require a big place to target large number of customers as well as to store a all variety of sports goods which are less offered or made available to the company
The business location is major element for the business success and this is highly important for every organization to focus more on business locality where business is to be set up such as market area, square meter area, customer choice, resource availability and so on. The business will require indoor and outdoor space for about 120 sq. meter and in which indoor space will require a 80 sq. meter space whereas for outdoor only 40 sq. meter for only customer parking.
In addition, business location will be attractive and also business interior decoration will also be designed in such a beautiful manner that it attracts customer on a regular basis. In the store, the reception area, two big desks will be placed where customer can make payment and ask for their requirements. In the store, all the products will be displaced in different sections so that it becomes easier for the customer and staff. This will help the customer to go directly to that section where required sport products are placed at one place of different brand and varieties. In the store, employees and customers are provided with best services for which proper facilities for male and female are provided to try the apparels and accessories of sports goods.
8.7. Operating Model and Procedure
Operations in a Sport goods store are like a cycle:
During this cycle, several steps take place once the customer enters the store, the staff members get alert to serve the customer with best in-store services as well as offering them best quality of sport products which they require.
The organizational structure of sport goods store will be as follows:
This above stated organizational structure clearly states that all three departments have their own roles and responsibilities which they have to perform for achieving the organizational goals and responsibilities.
The store will select marketing strategies which will not only beneficial to owner but also to customers. There will be a synchronization as well as integration of internet marketing and retail marketing. We are planning for establishment of a coherent as well as consistent marketing plan and will consider in the way to utilize almost all efficient forms of advertising, promotion and more tools of marketing. Particular techniques which will possibly be considered are:
- Print/ Newspaper Advertisements –In order to make store’s name in the mind of customers, there is need to advertise store’s name and objective through newspaper and print media. The plan is to post advertisement in local newspapers for informing consumers about location of the store and contact information. There is also plan to publish introductory coupons as incentive to first visitors to make them visit the store and make a purchase. Beside this, local sports magazines will also be used for advertising the store.
- Press Releases – Local newspaper in Hyderabad has column for new openings in city. All attempts will be made for getting coverage in that section. Also, the opening will be grand which increases the scope of media coverage at local level.
- Tournament/ Team Sponsorship – The store would actively participate in sports event. Sponsoring league and local teams will also be used for promotion by way of making available sports uniform and equipment rather than cash. All these activities will also be covered at our website.
- Event Sponsorship– All opportunities will be investigated to organization sports events, mainly those events which are managed by local bodies like organizing marathon, swimming competition etc.
- Decals/ Stickers – The store will have a logo. Stickers/ decals will be attached to all the orders dispatched. Logo would help in brand building and making store more popular.
- Apparel – The staff at the store will wear T-shirts having out logo printed on it. Beside this hats will also be distributed during events having out logo printed at forehead side.
- Grand Opening –In promotion of a store, its opening must be grand as much as possible. With the support of distributors and manufacturers, various prizes could be distributed during inauguration. At beginning, the price of consumable products will be kept minimum for increasing traffic in store. Such loss will get covered by cross selling of other profitable products. Store inauguration by local celebrity would bring more customers to the store and would also help in media coverage. To make the opening grand a series of small events will be planned like demonstrations, sports competition, free prizes based on registration for making customers familiar with the store.
- Trade Shows – Trade shows within the industry will be attended by our organization to gain knowledge of new trends and products. Through this, sound relationship could be maintained with suppliers.
- Word of Mouth – With great service to first time visitors and attractive price, publicity through words could be expected. Also, the various partnership with clubs would help is getting maximum word of mouth publicity.
- Yellow Pages– content details of our store will be advertised in yellow pages and other business telephone directories.
- Flyers– Distribution of flyers will be done at all major seasonal leagues. Those flyers will provide attractive discounts at stores as well as online shop. The discount might be divided between customers and non-profit organization the league.
- MailBox Flyers– Opportunities will be explored for distributing flyers to local nearby areas mailboxes.
- Discount Cardprogram- A discount card program will be started for attracting customers to make repeated purchase from the store. Reference bonus programs will also be there for providing excited discount for every successful purchase made by your referral. Data collected through discount card program or referral programs would help in using email service to inform about new discount coupons and new arrivals in the store.
- Business Networking– Business networking firm like linkedIn etc. will be used for creating awareness about the store.
- Direct Mail– Direct mail will be sent for promoting the store.
- Radio– In Hyderabad, radio is a powerful medium of advertisement. Sports people usually love listening radio to get relax and have a break. Opportunities will be explored in this area also.
- Catalog– Effectiveness of designing catalog will be explored based on requirements.
- Web Marketing– Different channels of web marketing channels will be explored and will be tested.
- Articles, Press releases, articles, or /and advertisement on other local internet sites.
- Marketing through search engine
- Banner Advertisements
- URL Links from/ to teams, company’s co-marketers, leagues.
- Marketing through E-mail
- simple questions with daily winners
- Events at store and its schedule
- Non-Profit Relationship(s)– The store has planned to be a permanent sponsor of minimum one nonprofit organization and develop sound relationship with it. Sponsoring of sports events for raising funds for the associated nonprofit organization and sharing a fixed profit percentage for specific promotional events organized for such organization. The store believes in paying back to community and this will also attract free publicity which is crucial for the business. Media is also interest in social aspects of business and our store will be actively involved in that.
All the decisions regarding marketing such as selection of media channel, frequency of advertisement, size of advertisement, associated expenditure will be considered on continuous basis. Evaluation of all alternatives will be done for future learning and doing justification with investment.
Red Roaster is required to formulate effective and effective marketing mix strategies for commencing its business in Pakistan. The marketing mix will comprise price mix, product mix, place mix as well as promotion mix of its goods and brands.
Company is required to extend its product portfolio to include more sports product varies depending on requirements and preference of local people. For that, organization is required to perform detailed market research for generating information regarding preferences and choices of local consumers and retail sports product which could fulfill requirement and reason to buy. In addition to that, company is also required to ensure confirmation of quality aspect for its new products to meet local government requirements. Moreover, the physical aspect is also important in the business. Hence, company is required to furnish and decorate its sports product houses in a manner to attract local consumers. For that cultural aspect is also required to be understood by company for getting attention of people. Organization must also include seasonal offering during festivals like Ramzaan. A well designed product mix will help the organization is creating a difference in the market and provide an edge over competitors.
Company is required to set its price competitive for reducing the effect of competition as well as to overcome the fear of economic recession within the nation. Further company might also include premium products in its list for satisfying needs of upper class. The strategy will help in attracting people from all social classes. Pricing strategy is crucial for company as it directly affect the profit margin of the company. But, with effective pricing strategies companies can effectively counter the economic recession risk and manage the purchasing power of buyers.
The place mix strategies would help the store in establishing its sports product chain in different parts of the country. The store must be opened in widely populated areas, such as close to colleges, schools, malls, cinemas, offices etc. Apart from that, the layout must be planned in a way to offer easy entry-exit to customers. The business is also required to train its employees to property serve its customers for creating brand image of the organization. The location of café must be such that, that people will find it easily accessible. Company can enter in associations for commencing new stores in populated areas to target mass customers.
The promotional mix of the company use include direct, print, and social media marketing strategies for making customer aware of the brand. For that company can advertise its product in newspaper, television, through social media, websites, personal selling for communicating with customers. Also, can include discount coupons, and run program of reference to promote its brand. For targeting youths, company must use social media and obtain feedback about its products as well as services. The store could also use hoardings for promoting the brand in local markets. The employees working in the store must be properly dressed up and trained to greet customers whenever they visit. The positive experience of customers will help in getting repeat orders as well as word of mouth publicity.
Implementation and Control
Implementation and control mechanism will make sure that strategies have been executed properly. Any deviations from set target would require corrective and immediate measure. All activities like inventory control, procurement procedure, distribution channel etc. will be monitored closely. Also, customer satisfaction as well as employee satisfaction will be assed at regular intervals.
Control
For controlling the operations store will decided some key performance indicators (KPI). Some of the KPI for the proposed business will be market share, sales growth; return on investment etc. will be assessed monthly, quarterly for responding to changing market situation.
The measurement of revenue of store would help in assessing the growth of business, moreover if it is decreasing than reasons for the same will be explored. Measuring sales growth would indicate that whether new strategies are required or not. Measurement of market share would help in assessing competitors’ performance and forecasting future of the organization as well as market potential. For instance, reducing own share but increasing competitors share denotes that market is full of performance but own organization is performing low. Return on investment will help in measuring the effective use of resources. The analysis will include calculation of various financial ratios for measuring the overall performance of the firm.
9.1. All in One Sports Goods Store’s Financial Plan
All in One Sports Goods Store will offer the best quality product in the market. In the context of this, the financial statement is prepared that determined the 5 years sales of the company with the accurate growth in the sale each year. The main target of the company will children and youth those are more interested in the entertainment and sport activities. In the financial management plan of All in One Sports Goods Store, the main acidities are management of the fund and balance the effective balance in the different funds.
| I | Management of the fund |
| II | effective balance in the different funds |
The initial investment of the company will be 5000000 INR. The owner of the company has the various options to manage the fund. In this, it will select tow significant sources such as capital investment and bank loan.
In the context of the personal saving, the owner will use 1000000 INR from its personal saving. However, in order to establish the business All in One Sports Goods Store needs 5000000 INR total money.
The remaining money 4000000 INR will be arranged from the bank loan. In this, the owner will borrow the money from a bank which has the lowest interest rate. It will be helpful for the All in One Sports Goods Store to set the business effectively.
At the same time, All in One Sports Goods Store will also use the bank overdraft to meet the short term liabilities in the business. It will help to All in One Sports Goods Store to pay the payment to the suppliers and creditors.
| Profit & Loss All in One Sports Goods Store | |||||
| PROFIT & LOSS | 2018 | 2019 | 2020 | 2021 | 2022 |
| Sales | 20,00,000 | 22,40,000 | 25,31,200 | 28,60,256 | 32,89,294 |
| less cost of goods sold | 8,00,000 | 8,96,000 | 9,90,000 | 11,18,700 | 12,75,318 |
| Gross profit/net sales | 12,00,000 | 13,44,000 | 15,41,200 | 17,41,556 | 20,13,976 |
| Expenses | |||||
| Lease/loan payments | 3,00,000 | 3,30,000 | 3,63,000 | 4,06,560 | 4,63,478 |
| Rent & rates | 1,50,000 | 1,65,000 | 1,81,500 | 2,03,280 | 2,31,739 |
| Motor vehicle expenses | 25,000 | 27,500 | 30,250 | 33,880 | 38,623 |
| Repairs & maintenance | 30,000 | 33,000 | 36,300 | 40,656 | 46,348 |
| Stationery & printing | 10,000 | 11,000 | 12,100 | 13,552 | 15,449 |
| Insurance | 5,000 | 5,500 | 6,050 | 6,776 | 7,725 |
| Superannuation | 50,000 | 55,000 | 60,500 | 67,760 | 77,246 |
| Wages (including PAYG) | 30,000 | 33,000 | 36,300 | 40,656 | 46,348 |
| Accountant fees | 5,000 | 5,500 | 6,050 | 6,776 | 7,725 |
| Advertising & marketing | 15,000 | 16,500 | 18,150 | 20,328 | 23,174 |
| Bank fees & charges | 1,000 | 1,100 | 1,210 | 1,355 | 1,545 |
| Bank interest | 3,000 | 3,300 | 3,630 | 4,066 | 4,635 |
| Credit card fees | 500 | 550 | 605 | 678 | 772 |
| Utilities (electricity, gas, water) | 25,000 | 27,500 | 30,250 | 33,880 | 38,623 |
| Telephone | 12,000 | 13,200 | 14,520 | 16,262 | 18,539 |
| Total expenses | 6,61,500 | 7,27,650 | 8,00,415 | 8,96,465 | 10,21,970 |
| Profit before tax | 5,38,500 | 6,16,350 | 7,40,785 | 8,45,091 | 9,92,007 |
| Income tax | 1,61,550 | 1,84,905 | 2,22,236 | 2,53,527 | 2,97,602 |
| Net Profit | 3,76,950 | 4,31,445 | 5,18,550 | 5,91,564 | 6,94,405 |
The below table shows that sales revenue of the company for next five years:
| 2018 | 2019 | 2020 | 2021 | 2022 | |
| Sales | INR20,00,000 | INR22,40,000 | INR25,31,200 | INR28,60,256 | INR32,89,294 |
The below table shows that less cost of goods sold/direct expenses of the company for next five years:
| Year | 2018 | 2019 | 2020 | 2021 | 2022 |
| less cost of goods sold/direct expenses | INR8,00,000 | INR8,96,000 | INR9,90,000 | INR11,18,700 | INR12,75,318 |
9.4.3. Administration Expenses
| Expenses | 2018 | 2019 | 2020 | 2021 | 2022 |
| Lease/loan payments | INR3,00,000 | INR3,30,000 | INR3,63,000 | INR4,06,560 | INR4,63,478 |
| Rent & rates | INR1,50,000 | INR1,65,000 | INR1,81,500 | INR2,03,280 | INR2,31,739 |
| Motor vehicle expenses | INR25,000 | INR27,500 | INR30,250 | INR33,880 | INR38,623 |
| Repairs & maintenance | INR30,000 | INR33,000 | INR36,300 | INR40,656 | INR46,348 |
| Stationery & printing | INR10,000 | INR11,000 | INR12,100 | INR13,552 | INR15,449 |
| Insurance | INR5,000 | INR5,500 | INR6,050 | INR6,776 | INR7,725 |
| Superannuation | INR50,000 | INR55,000 | INR60,500 | INR67,760 | INR77,246 |
| Wages (including PAYG) | INR30,000 | INR33,000 | INR36,300 | INR40,656 | INR46,348 |
| Accountant fees | INR5,000 | INR5,500 | INR6,050 | INR6,776 | INR7,725 |
| Advertising & marketing | INR15,000 | INR16,500 | INR18,150 | INR20,328 | INR23,174 |
| Bank fees & charges | INR1,000 | INR1,100 | INR1,210 | INR1,355 | INR1,545 |
| Bank interest | INR3,000 | INR3,300 | INR3,630 | INR4,066 | INR4,635 |
| Credit card fees | INR500 | INR550 | INR605 | INR678 | INR772 |
| Utilities (electricity, gas, water) | INR25,000 | INR27,500 | INR30,250 | INR33,880 | INR38,623 |
| Telephone | INR12,000 | INR13,200 | INR14,520 | INR16,262 | INR18,539 |
| Total expenses | INR6,61,500 | INR7,27,650 | INR8,00,415 | INR8,96,465 | INR10,21,970 |
9.5. Loan Interest & Principle repayment
| Year | 2018 | 2019 | 2020 | 2021 | 2022 |
| Lease/loan payments | INR3,00,000 | INR3,30,000 | INR3,63,000 | INR4,06,560 | INR4,63,478 |
| Bank interest | INR3,000 | INR3,300 | INR3,630 | INR4,066 | INR4,635 |
| Year | 2018 | 2019 | 2020 | 2021 | 2022 |
| Profit before tax | INR5,38,500 | INR6,16,350 | INR7,40,785 | INR8,45,091 | INR9,92,007 |
| Income tax | INR1,61,550 | INR1,84,905 | INR2,22,236 | INR2,53,527 | INR2,97,602 |
| Net Profit | INR3,76,950 | INR4,31,445 | INR5,18,550 | INR5,91,564 | INR6,94,405 |
Break Even point in units = Fixed cost / (Sales price per unit – variable cost per unit)
= 80 / (150-40) = 0.72
Break even in INR = sales price per unit * break even point per unit
Break even in INR = 150 * 0.72
= 108
= 500000 / 0.72
Break even in INR = 6944444 INR
| Initial investment | -5000000 | CFI | ||
| Year 1 | INR20,00,000 | INR20,00,000 | Initial investment | 5000000 |
| Year 2 | INR22,40,000 | INR42,40,000 | Uncovered | INR9,24,200 |
| Year 3 | INR25,31,200 | INR67,71,200 | Break Even Point | 2.18484 Year |
| Year 4 | INR28,60,256 | INR96,31,456 | ||
| Year 5 | INR32,89,294 | INR1,29,20,750 | ||
Average sale price of per unit will be 150 INR
Fixed cost of per unit will be 80 INR
Variable cost of per unit will be 40
The initial investment of the company will be 5000000 INR
Cost of the CFGS will be approx 40-45%
Gross profit margine will be 55- 60%
Indirect and administration expense will be 10-15%
Company will pay 30% tax on income
Net profit margin will be approx 15-20%
There are different types of risk which are associated with the sports goods business such as shortage of inventory, conflict among the employees, untrained sales staff, lack of customer base and so on. These all risks are affecting the business performance to a large extent mainly on the business operational activities. For this risk, proper risk management plan will be develop for avoiding and eliminating the risk efficiently so that business performance get improve or develop and attain its business vision and mission successfully. In the risk management plan, impact and difficulty and response to difficulty will be analyzed in advance in order to mitigate the risk.
In order to successful manage the project and overcome the possibilities of arising any issue, risk management is one of the major steps that will be used by the project manager. It is because without risk management plan, it is not possible for the project manager to accomplish the project on time successfully. In this concern, there are different steps that will be taken by the project manager to manage the risk. In this, identify the risk will be the first step that will taken by the project manager (Heldman, 2015). The project team will analyze the risk of the project and will describe the outcomes of that risk on the project. There are different techniques that can be used by the project manager to identify the risk in the project (Hackley, 2010). After getting the idea of the risk, the risk will be analysed in the next step of the risk mitigating plan. In this, the likelihood consequence of the risk is analyzed by the project manager. So, by analyzing the risk, the project manager will plan the strategy and the ways to manage that risk effectively.
Along with following the all steps of the risk, the all risks and risk plan will also be registered for getting the clear view about the all steps that are taken by the project manger during mitigating the risk. In the third stage, risk is evaluated by the project manager and different decision are also taken by the project manager and in this it is also determined that the occurred risk whether should carry with the project or should leave the risk (Evans and Lindsay, 2016). It is because sometime the risk occurs in the project but they don’t affect the project and the project manager can carry that risk with the project that is why these decisions are to be taken by the project manager. In the other stage, the project manager treats the risk and in this all finalized plan for managing the risk is implemented on the risk for managing the project effectively and to successful accomplishment of the project. At the same time, in the last step of the risk mitigating plan, the all risk is monitored by the project manager as well as it is also reviewed and checked. It is because the project manager tries to keep safe the project from any hurdle and the issue (Edwards, and Bowen, 2013). Because of this, the all process of the risk managing is monitored by the project manager effectively.
Apart from this, there is also a risk matrix that can also be used by the project manager to complete the project on time and to keep safe the project from many hurdles.
| Negligible | Marginal | Critical | Catastrophic | |
| Certain | Extra expanses | Infrastructure | Complete within time | Light issue |
| Likely | Work Not completed | International delegate | Target the all students | Natural disaster |
| Possible | Delayed | Food management | Get permission | Issues related to the health |
| Unlikely | Accident | Tickets sales | Marketing | Noise constraint |
| Rare | Safety | Highest returns | Parents and friends can join also | Manage event |
So, it can be determined that for successful accomplishment if the project graduation party, there is a vital role of the risk management plan or risk matrix for the project manager.
Avoidance
Avoidance is the best means of loss control. This is because, as the name implies, you’re avoiding the risk completely. If your efforts at avoiding the loss have been successful, then there is a 0% probability that you’ll suffer a loss (from that particular risk factor, anyway).
This is why avoidance is generally the first of the risk control techniques that’s considered. It’s a means of completely eliminating a threat.
Loss Prevention
Loss prevention is a technique that limits, rather than eliminates, loss. Instead of avoiding a risk completely, this technique accepts a risk but attempts to minimize the loss as a result of it. For example, storing inventory in a warehouse means that it is susceptible to theft.
However, since there really is no way to avoid it, a loss prevention program is put in place to minimize the loss. This program can include patrolling security guards, video cameras, and secured storage facilities.
Loss Reduction
Loss reduction is a technique that not only accepts risk, but accepts the fact that loss might occur as a result of the risk. This technique will seek to minimize the loss in the event of some type of threat. For example, a company might need to store flammable material in a warehouse. Company management realizes that this is a necessary risk and decides to install state-of-the-art water sprinklers in the warehouse. If a fire occurs, the amount of loss will be minimized.
Separation
Separation is a risk control technique that involves dispersing key assets. This ensures that if something catastrophic occurs at one location, the impact to the business is limited to the assets only at that location. On the other hand, if all assets were at that location, then the business would face a much more serious challenge. An example of this is when a company utilizes a geographically diversified workforce.
Duplication
Duplication is a risk control technique that essentially involves the creation of a backup plan. This is often necessary with technology. A failure with an information systems server shouldn’t bring the whole business to a halt. Instead, a backup or fail-over server should be readily available for access in the event that the primary server fails. Another example of duplication as a risk control technique is when a company makes use of a disaster recovery service.
Diversification
Diversification is a risk control technique that allocates business resources to create multiple lines of business that offer a variety of products and/or services in different industries. With diversification, a significant revenue loss from one line of business will not cause irreparable harm to the company’s bottom line.
Risk control is a key component in any sound company strategy. It’s necessary to ensure long-term organization sustainability and profitability.
From the above business plan report, it can be concluded easily that Sport Retail Company can easily establish in Hyderabad, an Indian market.The detailed analysis of market situational analysis helped in identifying the strengths and opportunities to enter in this industry or market as well as this also helped inincrease in demand for the sports products and servicesin best quality by the customers. While analyzing the Indian market, it is identified that there are large numbers of customers who are interested to develop their professional career in sports sector.
From the above discussion, it can also be determined that there are different analysis such as internal and the external that are also done by the firm. It is because these all analysis will be helpful for the firm to perform well in the market and to successfully operate the business. As well as, it can also be concluded that the operational activities and the financial activities are also discussed in this paper. It makes easy to get the idea about the all financial plan for the firm and will also make easy to formulate the all business strategies as per the financial plan and the meeting. In like manner, it can also e concluded from the above discussion that in order to sustain in this competitive market, company need to uses the suggested sales and marketing strategy for managing or tackling the goods and services.
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