Entrepreneurship

3rd April 2012 Business Plan of HI FLY Helmet

Submitted To Sir Adnan Rafiq

Acknowledgment
Sir Adnan Rafiq
The Course Instructor Entrepreneurship Superior University, Lahore

Respected Sir

Adnan Rafiq;

We would like to thank you for the valuable guidance and advices that you provided us throughout your tenure with us, you inspired us greatly to work in this project. Your willingness to motivate us contributed tremendously to our projects and class assignments. We would also like to thank you for showing us some cases that related to the topic of our projects, and linked the theory to practical to make us comfortable. Besides, we would like to thank our institute which provided us an excellent environment for the creation of this project; we would like to take this opportunity to thank to all of our class fellows for the creation of this project. It gave us an opportunity to participate and learn about the major areas of

Entrepreneurship.

Sincerely Yours Group Leader Asif Riaz MBP 11029

Entrepreneurship

Contents
The Opportunity ........................................................................................................................................ 9 Description of Business ............................................................................................................................ 9 Product ........................................................................................................................................................ 10 Brand Name ................................................................................................................................................ 11 Slogan ......................................................................................................................................................... 11 Competitive Advantage .......................................................................................................................... 12 Current Status and Requirement ............................................................................................................. 12 Description of business stands today .............................................................................................. 12 Description of what the business needs to move forward ............................................................... 12

(3) Management team ............................................................................... Error! Bookmark not defined. Description of Organizational Structure: .................................................................................................... 16 A. Legal Structure: ............................................................................................................................... 16

Organizational Structure & Ownership....................................................................................................... 18 Business Model ........................................................................................................................................... 18 Supply Chain............................................................................................................................................... 20 Distribution Channel ................................................................................................................................... 21 Industry Analysis ........................................................................................................................................ 22 Industry Analysis ........................................................................................................................................ 23 a. Industry Size ....................................................................................................................................... 23 Driving and Cell Phones ..................................................................................................................... 23 Industry attractiveness......................................................................................................................... 32 Profit potential .................................................................................................................................... 33 Competitors Analysis ............................................................................. Error! Bookmark not defined.

SWOT Analysis .......................................................................................................................................... 34 Marketing plan ............................................................................................................................................ 37 A. B. C. Product Feasibility: ............................................................................................................................. 37 Price Strategy ...................................................................................................................................... 39 Promotion............................................................................................................................................ 41

Operational Plan.......................................................................................................................................... 42 Operational plan:......................................................................................................................................... 43

B. C. D. E. F.

Availability of Labor Pool .............................................................................................................. 45 Business partnership ....................................................................................................................... 45 Quality Control ............................................................................................................................... 46 Customer Support ........................................................................................................................... 47 Growth Scope.................................................................................................................................. 48

Financial Plan.............................................................................................................................................. 49 Initials Current Investment ........................................................................................................................ 50 The amount for startup for this business is 2million. This amount will be initially invested by four directors which are also partners. And this amount will be equally invested by all four partners. ............. 50 Capital Requirement for the next 3-5 years: ............................................................................................... 50 1. Sources and Uses of Funds: ............................................................................................................ 50

Future plans............................................................................................................................................. 50 Overview of the financial projections: .................................................................................................... 51 FINANCIAL PLAN.................................................................................................................................... 52 Income Statement........................................................................................................................................ 53 8.3) Projected Income Statement ........................................................................................................... 53 Cash Flow Statement .................................................................................................................................. 55 8.5) Balance Sheet (Projected) .................................................................................................................... 56 Working .................................................................................................................................................. 58 Breakeven Analysis .................................................................................................................................... 59 Exit Strategy............................................................................................................................................ 60 Critical Risk ................................................................................................................................................ 63 A. B. C. D. E. 1. Management Risks: ......................................................................................................................... 63 Marketing Risk: .............................................................................................................................. 63 Operating Risk: ............................................................................................................................... 64 Financial Risk: ................................................................................................................................ 64 Intellectual Property Infringement: ................................................................................................. 65 Flex ................................................................................................................................................. 66

2. Hi- Fly Helmet Models ......................................................................................................................... 67 3.Pamphlet .............................................................................................................................................. 68

Executive Summary
By the grace of Almighty God, We have successfully completed our business plan. We are going to launch our new product Helmet in market For Business idea We selected Hi Fly Helmet according to the increasing in aspect ratio of road accident. Most of the death happened due to the negligence in wearing helmet. Pakistan is in really bad condition and costing country huge loses every month. In research report more than 15% death due to mobile phone during drive. Our target market is youth because youth maximum use mobile as compare to senior citizen. Youth is crazy about riding bikes and wants to be up-to-date with their calls on mobile phones. They either dont want to use a helmet or dont feel convenient while using it. People do not want to leave their cell phones while they are on road. Due to increase in mortality rate in Pakistan, Ex-President of Pakistan set the compulsion of wearing helmet on bike rider. Economical situation of Pakistan is not very favorable I choose this business idea because Pakistani people ride their bike so harshly and also use mobile phone during riding We are advertising it on the print media to aware bike rider about the importance of helmet, and promote it on a social campaign, with Traffic police and National highway police to create awareness of Road Safety and contract with the bike seller. Bluetooth, hands free port and the most important point of differentiation We are 4 partners in this business. We invest our capital in this business to give shape our idea. We start our business by a shop on Macleod Road. Our competitor is UNEED but they do not introduce helmet with Bluetooth due to this idea we have Monopoly in Market.

The Business

The Opportunity a) Problem To Solve Or Need To Be Filled

Bike is one of the most widely used transportation means especially in the countries like Pakistan. In the previous time it was considered to be the most important way of transportation, but unfortunately this facility can turned into a deadly disasters, due to its wrong or misusages. There for we are going to launch a new product in market, the product is Hi Fly Helmet. This includes different features like hands free, Bluetooth etc. This will help the rider in getting a better and a clear image of the back road and also fulfill the need for entertainment for the young generation.

Description Of Business Proposed Business To Solved The Need

Now a day different companies introduce Motor cycle. Our youth like stylish bike. Our young generation using phone when they drive a bike. This is too much dangerous for precious life. Our company introduces a helmet in name of Hi Fly. Our product is stylish and attractive for youth. This product is comfortable, safe and sound. We know our customer they are trend liker and try attractive and new product which suits their personality. Our helmet fully designs for youth. Macleod road is our business location because it the famous place of bike spares parts so the customer can easily purchase the product from there. WE PROVIDE THE SHORTEST SOLUTION To Your Safety To The anxiety of Travelling To the Far Of Places

WE PROVIDE QUALITY PRODUCTS & SERVICES.

 WE ALSO PROVIDE SERVICES ALONG WITH OUR PRODUCTS Products include: Hi Fly Helmets

History
The equity partners of our company were previously working with different organizations and providing these services there well, we had a large No. of customers who wanted us to start this business in Manufacturing Helmets. Working with different organizations we had enough skills and experience to run our own firm, we were sure of the fact that all of us are capable to take initiative to start our business. We all have our own areas. We have a Company support and Advisor.

Objective Of The Company

Our objective is to serve safety to bike riders, helping them to mitigate road accidents while driving, and facilitate them with the minimum cost that all level of society can get benefits from it.

Mission
Build the Branded Helmet to Improve the Safety and Customer Satisfaction

Vision
Providing Innovative Road Safety

Product
We are going to launch a new product in market; the product is Hi Fly Helmet with unique features.

Product Differentiation:
1. Bluetooth. 2. Hands free port.

Brand Name Hi Fly Helmet.

Slogan Stay Connected on the way

.

Competitive Advantage a) Description Of The Business Model

1. Technology Oriented 2. Need innovation 3. Minimum Cost 4. Trend crazy

Current Status And Requirement Description Of Business Stands Today

Hi Fly has a first mover advantage in a sense that we have Bluetooths Helmet in market. There is no competitor who provides like our product and services under one roof. Every Helmet Manufacturer in the market is our direct competitor. Thus we can define our current status. Hi Fly is currently in an introductory stage. We have finance and budget of 2 million PKR under which they have to cover their all expenses. The management team has gone through all its legal documentation with all terms and conditions for the business that they have decided to launch. The first shop of Hi Fly is going to be at Macleod Road

Description Of What The Business Needs To Move Forward

The Amount of Capital Needed and What the Capital Will Be Used For, If the Plan Is Going To a Potential Investor Hi Fly have a need of land (1 kanal) which is situated near Macleod Road. Which is provided by one of our investor for building the infrastructure the cost required will partially be taken from the management team and the rest will be from investors. The building will be constructed by through a construction company on behalf of our investors.

Management Team

CEO Managing Director Finance Director Finance Manager Marketing Director Sales Force Production Director Production Consultant HR Director

Company Structure

Description Of Organizational Structure:

Managing Director: Managing Director is to Review and analyze the system of Company. Finance Director: Finance Director is to review the running budget and Financing of the Company. Marketing Director: Marketing Director is to review market situation and make policy in accordance. Production Director: Production Director is to review the production and assure the quality of the Product.

Hr Director
HR Director is to review Human resource and analyze the employees of the company.

Finance Manager
Finance Manager Controls finance of the company and report it to their Finance director.

Sales Force
Sales Force job is to achieving targets and makes sales promotion of the brand.

Production Consultants
Production Consultants is to check and balance of the product.

A. Legal Structure:
In the beginning of the business the above mentioned four partners will also work as department managers.

In order to work efficiently and to make our business a success, we have planned to work as a team. All the five partners are assigned a particular designation in the company and are responsible for their departments.

Legal Form Of Organization

The legal form of our business is Partnership. We are going to hire a professional consultant to help us in our business in the beginning. Our Managing director will control all the business activities. Our production manager will deal with the production operations and will take suggestions from the consultant. Our consultant will be responsible for guiding us from beginning to end the technicalities of this business. Marketing department will be responsible for getting new contracts for the business, and for establishing the Hi Fly helmet as a trusted brand.

Company Laws
1. The four partners will work as the board members of the company. They will legally be responsible for all the lawful dealing of the firm. 2. The meeting of partners will be after every two weeks. 3. All the four head of the departments will work under Managing Director of the company and must report directly to the C.E.O. 4. In case one manager is not available the responsibilities can be transferred to any other, with the consent of the other member. This can be done only when all the four partners are willing to do so or at least 1/3 majority is on one side

5. Any of the four partners can back out of the business after giving a one month prior notice. 6. In case of emergency meeting can be called at any time.

Organizational Structure & Ownership

Our organization structure is horizontal and centered (coordination). The structural details are as follows. We are going to hire a professional consultant Mr. Tariq who is a main person in the market of helmets. Who will work as an expert consultant and guide us in our business, through their deep knowledge about this industry. We have signed a one year legal contract will our consultant. Our hired consultant will work with our team and he will guide us in the light of his knowledge. The proper maintenance of our account is also the main part of any business, and we will hire an accounts person for proper checks on accounts. The marketing person is responsible for the marketing and selling of the product and for these purpose two persons will be, going to work under his supervision. The production person will be looking after the assembling of the helmet and inspection of the quality. The HR hires the workforce of the company and look after on the employees and CEO review and makes the policy of the company. And that person will look after the good coordination between all the departments and will also make all the employees satisfied.

Business Model
We will start our operation from Macleod Road. The location is perfect for our business as we can enjoy different benefits here. Here we can also avail the entire facilities related to helmet. As we are the innovators with these

new features in helmet market, so there is no previous data available to measure and to forecast the market trend or demand. We therefore are hiring the services of an expert. In our marketing operations we hire two sales people who go to whole sellers and take order from their shops and we will be purchasing Bluetooth from Zain Traders which is situated at Hall road for our production process of helmet. In Pakistan no machinery is used to manufacture helmets. So the manufacture will be done with hands except the dyes of the helmet and for that purpose we can manufacture the helmet at Al-Fatah market 2nd floor Macleod Road. As it is near to us so the transportation cost will be less and it will also save our time. This is why that we start our own working from here. The reason for not doing this is that it is costly as the electricity crises are at its peak, so its easy for us to import the material from china and assemble it here. But that will be of very low quality and the good quality will increase our cost too much. So we have to go for the other option and that is to purchase the raw-material from the local manufacturer like Aftab Manufacturers, Tariq international, Hall road, Beadon Road etc and then assemble those parts and give the customer new and quality product.

Supply Chain

Suppliers

Customer

Manufacturers

Dealers

The lead time will be of 7 days, with a very little uncertainty in the demand. And inventory is to be kept for 1 months time. It is easy to store and handle the product.

Distribution Channel
We use private channel and deliver our product from vender to the Whole seller.

Distributor

Retailer

Manufacturer

Whole Seller

Customer

Initial Financial Budget

To take start we have rented an office at Macleod road in the 2nd floor of Al-Fatah Market and the 2 other shops for the assembling and storing the helmets at a rent of Rs.30,000 and security Rs.400, 000 for the shop. Our initial investment will be Rs.20, 00, 000. The reason for opening our office at Macleod Road is because this is a market of bikes and spare parts of bikes. One of the reasons for building our office here is that this is a whole sale market. Whole seller comes here and gives their orders. So we decide to take a start from the main and important market of Lahore as it is also a helmet market. Thus it will be easy to have more customers and capture the higher market share in lesser time, which is one of our desired objectives.

Industry Analysis

Industry Analysis A. Industry Description Industry Trends

The current industry in Pakistan is having high potential as there is a large Gap in the current industry. Youth is crazy about riding bikes and want to be up-to-date. They either dont want to use a helmet or dont feel convenient while using it. In Pakistan helmets are either being imported or are made locally. People do not want to leave their cell phones while they are on road. The growth in telecom sector has made people so much conscious that they dont want to leave their cells on road while they are even on their bikes.

a. Industry Size
Driving and Cell Phones

The picture below shows a man talking on his mobile phone while carrying a deep freezer on his motorcycle in Lahore. This picture is a symbol of dangerous driving situation in todays Pakistan.

This shows the shifting attitudes towards cell phones and driving in the developed world. It is now commonly accepted that driving and talking on cell phone at the same time is distracting and should be avoided.

For using mobile phone while driving, motorcyclists will be fined Rs 200,

Telecom Industry As A Supportive Industry

People do not want to leave their cell phones while they are on road. The growth in telecom sector has influenced the society to a great deal. The craze is to stay connected. Telecom industry is growing at a fast rate and this is opening new horizons of success and also opening new market for investment. Pakistans recent telecom developments constitute a South Asian success story. From two million in 2002, the number of active mobile SIMs increased to 111 million by end 2011. This is a compound annual growth rate of 115 per cent a year, one of the highest in the world, and the highest in South Asia for that period. This growth can be seen in the following chart.

Annual Cellular Subscribers Mobilink 2003 -04 2004 -05 2005 -06 2006 -07 2007 -08 2008 -09 3,215,989 7,469,085 Ufone 801,160 2,579,103 Zong 470,021 924,486 Instaphon e 535,738 454,147 835,727 508,655 Telenor Warid Total 5,022,908 12,771,203

17,205,555

7,487,005

1,040,503

336,696

3,573,660

4,863,138

34,506,557

26,466,451

14,014,04 4 18,100,440 20,004,707

1,024,563

333,081

10,701,33 2 18,125,189 20,893,129

10,620,386

63,159,857

32,032,363 29,136,839

3,950,758 6,386,571

351,135

15,489,858 17,886,736

88,019,812 94,342,030

34,048

2009 -10

32,202,548

19,549,100

6,704,288

23,798,221

16,931,687

99,185,844

2010 -11

33,378,16 1

20,533,78 7

10,927,693

26,667,079

17,387,798

108,894,518

Jul11

33,545,462

20,569,290

11,594,583

26,946,265

17,036,690

109,692,290

Aug11

33,468,080

20,624,408

12,045,445

27,061,319

16,685,299

109,884,551

Sep11

33,412,130

20,681,699

12,591,120

27,309,21 8

16,334,27 7

110,328,44 4

Oct11

33,537,922

20,828,145

13,168,02 5

27,607,043

15,985,299

111,126,434

SCO Cellular Subscribers are 346,762

Political
The use of motor bike helmet was first made mandatory on 3rd March 2005 by ex-president General Pervaiz Musharaf due to the increased number of road accidents and cut throats due to kite flying. In 2005 as the mortality rate increased due to large number of road accidents and cut throats accidents. Government of Pakistan declared it mandatory for the bike riders to use a helmet, as they ride bikes. This law was also enforced to keep the bike riders safe and to prevent them from any Skull injury in case of accidents. The law was also supported by the Chief Justice of Pakistan Justice Iftikhar Muhammad Chaudhary. Sunday,April26,2009LAHORE The National Highways & Motorways Police N-5 Central DIG, Syed Ibne Hussain has said that motorcyclists in Pakistan are amongst the most careless drivers in the world, and they pay minimal or no attention to their own safety. He said this while presiding over a meeting held to review arrangements for the launching of road safety campaigns at the Zonal office, Lahore.

The DIG observed that majority of riders did not bother to wear protective helmets which resulted in head injuries. Following the directions of Inspector General NH&MP Dr. Wasim Kauser, the NH&MP Lahore N-5 Central have launched special campaigns titled Vehicles without Tail/Brake Lights, Use Of Safety Helmet, Effectiveness of Right Back- View Mirror and Keep the Extreme Left Lane with a view to create road safety awareness and soft policing among road users. The DIG said that the NH&MP was carrying out helmet-wearing campaign to make all bike riders wear helmets. He said that there was a need of raising awareness about safety benefits of wearing protective helmets as head injuries mostly proved fatal.

Economical
The economic situation of Pakistan is not very favorable. Increasing inflation rate, increasing unemployment, collapsing stock market and other unfavorable economic issues have made the situation disastrous. Some findings of economical draw backs are as under 1. Inflation rate has raise from 9.31% to 30% in the last year. 2. Unemployment has raised up from13.6 % to 15.2 (est.) (from 2010 to 2011) 3. More than 24% of the country population is below poverty line 4. The stock market has badly collapsed in the last few months due to uncertain political conditions of the country. 5. The Pakistan rupee has fallen to a record low price 6. Foreign-exchange reserves fell by $16.68 billion to $14.903 billion in the week ending December 2011. 7. Industries of the country are at the edge of being shut down, due to very high cost of production. The intense short fall of electricity has doubled the cost of production and has made the situation even worst.

Social
Consumer behavior and life style are changing rapidly. The advancement of technology and the wide spread of media has captured the mind of the people to a great extent. Man has becoming more and more social and technology oriented, and this need has been excellently met by cell phone technology. Use of mobile phone has turned into a fashion and a status symbol rather than a need. Now people do not want to miss even a single moment of their life which they can spend with their loved ones. Social circles are becoming wider as different telecom companies are entering into the market with their unique

selling points, they are offering more attractive facilities in the form of low price packages or voice craze etc. All these facilities have actually made the consumers addicted to use cell phones throughout the day, and as a result people are not ready to miss even a single SMS or a call. On road, in offices, in car no matter where you are, you will surely find someone or the other holding a cell phone next to their ear.

Technological
The technology in the field of helmets is still very backward. Even in todays fast moving world the helmets are made with hands

Porter 5 Forces Model

Porter five forces model is an extremely useful model to analyze the outer environment for any strategic analysis. This model takes into account all the five major forces of the market and thus suggest a way to analyze the current situation of the industry. Porter five forces model in this scenario is given as

Supplier
Here the supplier has limited or no power as the product is more than a commodity, all the suppliers import the end product from China and sale it here in Pakistan. And some manufacturers also manufacture it at

Shaikhupura road. And there is no concept of backward integration in this industry so far.

Substitute
The product has no near substitute as it is a complimentary good itself. Although there are number of varieties in helmets but one type of helmet is used for one specified purpose. That is a bike helmet, and it is only used by bike riders, similarly a cycle helmet is also used by some of the rides. The other substitute is cap which is use in all type of the season.

Buyer
Due to the complementary nature of the product, the buyer is very little or not at all involved in this product. The buyers switching cost is very high, due to their price sensitivity, they do not actually differentiate the product. Most of the sale purchase is done upon the basis of price sensitivity or a little know how of the product.

New Entry
No barriers for new entry exist. There is no restriction for entering and exiting in this market. And anyone can manufacturing and start selling helmet.

Gaps
The above mentioned analysis clearly reflects the current situation of the industry. The industry is full of Gaps. There is a high potential of growth in this industry. Market forces are weak and in this situation even a little innovation can capture a large market

share. The basic problem of the industry is a homogenous product with no development. All this industry needs is a little innovation and a strong public awareness program.

Industry Attractiveness
The future of our business depends upon the growth of Motorbike Industry. The table below provides a detail of the last year sale of some big Motorbike manufacturers. The table shows that this industry is very potential and there is a large scope for future growth.

July 2010 to Nov 2011 Company Honda Yamaha Suzuki China bike Production (Unit) 6,085,433 3,950,088 1,600,058 15,005,345 Sale (unit) 5,865,720 3,500,544 1,582,043 14,875,460

Year

Motor Cycles Sold In Units

2004-2005 2005-2006 2006-2007 2007-2008 2009-2010

11,751,694 12,007,112 13,008,554 15,516,673 16,670,000

The above table gives an indication of the overall industrial growth for the last five years. The data reflects that the growth was maximum in 2009 but then in 2010 there occur a fall in this industry and now it is again moving toward the boom.

Profit Potential
As in the above table we see the increase in production and sales of motor bike in Pakistan which tends to increase the sales of helmet which shows there is profit potential in the business and also the future growth. Our product include new feature which also tends the customer to buy Hi Fly Helmet. So the people dont have o use cell phone while driving bike. By the enforcement of national high ways regulation authority helmet should be used while driving motor bike. This will increases in the sales of our helmets.

B. Target Market: Description Of Target Market

Our target customer is Bike Rider. But the show room or dealer who deal in both new and 2nd hand motorbikes, in addition to it Motor way and highway police are also included in our target market. Our target customer is also youth, the reason we are focusing upon the youth is their way of thinking. Todays youth want to be different; they are fun loving and want to enjoy every moment of their life. They are ready to pay more for their life and satisfaction.

SWOT Analysis Strengths:

Company can launch its product according to the taste of end-users. Shipping, Marketing and Social factors are less troubling for sale point of view. Company is able to expand its markets and work to produce various products. Company has Homeland advantages over its competitors.

Weakness: Most people consider homeland products low in quality and durability. Marketing is rather tough due to international
Competitors deep roots in Pakistan.

Inflation can affect the cost and sale of companys

product.

Due to the purchasing of Raw material from

foreign countries, company needs enough. Time for stable production and can suffer from production cost variations.

Opportunities:
Product would be easily available on nearby shopping centers and companys sale centers. Company can compromise on low profit margins due to homeland benefits. Post sale services would be easily available for our customers rather than that of foreign companies. Marketing of product will be more effective and low budgeted because of home land advantage.

Threats:
Company is new in market. Company has competition with market giants of same product.

People would prefer old companies because of their old and well developed history and repute respectively. Political and economical environment is unstable in Pakistan that can suffer the companys investment.

Marketing Plan

Marketing plan
Market is developed according to the customer needs and want. When an entrepreneur understand the needs of customer then he can properly satisfies his customer. In the terms of marketing your product contains that features which attract your customer. If you dont deliver the right product to the right customer you will never survive the market. So most of important thing to survive in the market is the product you offered to customer.

A. Product Feasibility:
Product feasibility includes the product designs and the offering to their customer .our product clearly defines that it is beneficial for those who use cell while driving bike. Hi Fly helmet feature are designed according to the customer need because there is no product in the market which provide all feature in such shape. Product feasibility includes these following features which improves the product image among the customer.

Product Strategy
Customers desires the product purchased are in better in quality and performance. So as an entrepreneur we provide innovative feature like blue tooth, speakers and hands free in our product Hi Fly helmet. It includes superior quality of inner and outer surface. Outer surface is tough and inner surface is made of that material which also absorbs the heat and material remains the inner surface cool. Product strategy includes following types.

Product quality Brand name Product design Product feature Packaging Services and warranties

Hi Fly helmet is prepared by the skilled labor so the product quality is better than the other helmets available in the market. Firstly Hi Fly helmet is launched in one design and three different color combinations. Product features of Hi Fly helmet differs from other product available in the market. Most important to the customers after sale of product are after sale services and warranties in case of damaged product. We provide our customers 1 month warranty in case of any problem regarding blue tooth and hands free.

Concept Testing:
Concept testing acknowledges the importance of the creative, research, and concept refinement process involved in concept development. We

believe our concept testing research philosophy is what differentiates us from many other market research firms. These principles guide our concept development and testing study designs:

Concept testing is both a research, and a creative concept development activity.

In the beginning, we focus on concept development. Using a hybrid research design, we blend the qualitative research mode with quantitative concept ranking, this to refine concept development and assessment of appeal.

Finally, we acknowledge that a full understanding of concept appeal must be assessed in a mode with maximum realism.

Usability Testing:
Hi fly using the Usability testing technique used to evaluate a product and services by

testing it on users. This can be seen as an irreplaceable usability practice, since it gives direct input on how real users use the product and services.

B. Price Strategy

Part name Helmet.. Thermo-pole. Rubbers. Nuts

Rs 500 10 25 10

Bluetooth Pins. Speaker Total

350 10 85 990

After making all the above costing we give two prices to our two dealers.

Bike Dealer Motorcycles Whole Sellers

1500 1600

Cost Benefit Analysis

Cost of helmet Having following features. Bluetooth Hands free pins

1800

Users of our helmet save the following cost Cost of Bluetooth Hand free Helmet Fuel Cost Total 950 250 1000 100 2300

Difference

500

Cost benefits analysis

If we want to purchase these things than we have to bear the cost of

2300.Whereas in our helmet these things are built in. And we are charging only 1800.It will save 500 rupees of every purchaser of this unique type of helmet. Which is really a cost saving, exactly what a customer want to get, also save cost of Traffic challan as well as the most important is save human life.

C. Promotion
1. Public awareness through companies outlet (bikes outlet) 2. Brand endorsement through unique features 3. Contract with Bike sellers 4. A social campaign, with Traffic police and National highway police to create awareness of Road Safety.

Operational Plan

Operational plan: A. Method of Production

The process starts after placing the order of Dye of the helmet. There are three main types of dyes used in the manufacturing of the helmet. First we order the upper (ABS material) and lower dye, which in other words is also called the Shell and the Base of the helmet. Then the second step is pasting the stickers. These stickers are also in contracted with our supplier, who will provide us the shell and also the varnish or painting of the shell. All these things will be provided by our main supplier (Aftab & Manufacturers); manufacturing plant is their in

Shadara. The cost at which they are providing us the shell is 115, with our required adjustments as per the innovations required in the helmet. The third step is the thermo-pole sheet; this sheet will be taken from the Beadon Road. The thermo-pole will be adjusted in-side the shell and then, it will be fixed by the glue. The price of each Thermo-pole is Rs.10 per piece. Fourth step is to fix the hands free and blue tooth device in the inside thermo pore sheet only the hands free point and speakers are visible and the Bluetooth device is also visible and easily adjustable according to the ear. The fifth step will be fitting the windows; there are 2 windows in each helmet, upper and lower. The cost of these windows is Rs.6 per pair. In Sixth step the fitting the chin bar will going to be done. The seventh step will be lining, in this there are 2 sub heads; first the cutting machine (25000) cuts the foam and the cloth. Then the second step will be the stitching of the cloths and foam, this is also done by the machines. The 2 stitching and one cutting machine will be purchased for this process (cost of stitching & cutting machines are

Rs.50000). The foam (moderate quality) will be fixed on the thermo-pole; which will be purchased from the local manufacturer. This will reduce our price. Then the cloth is placed on the foam with the machine. In eigth step we shall fix the ears which cost Rs.27, the nuts Rs.2, the rubber Rs.3 and front glass mirror which cost Rs.50. The spherical mirror (Facial Optics) In the last step the packing is done and the helmet is read for dispatching. It will take just above an hour for the production of a single helmet with adding our features.

B. Availability of Labor Pool

Our labor pool includes 10 people which perform their specified tasks. First includes the cutting of upper surface of the helmet, Second include the cutting and fixing of inner surface (thermo pole) .Third is adding the glasses and the front mirror of helmet. Fourth includes fixing of additional feature in helmet, Last is fixing and tightening of screws and on the All helmet body. Finally one person inspects the whole helmet and check whether there is a scratch or any missing screws left. After complete inspection helmets move from production process to the ware house. Further includes steps wise tasks performed by labor 1. 2 people for juke machines ( cutting of upper surface of helmet ) 2. 1 for cutting machine of inner surface of helmet (thermo pole) 3. Fixing the thermo pole in the outer shell.. 4. Fixing the Bluetooth port, MP3 and hand free pin, Placing chin bar. 5. Placing of stickers and final polishing and shiner on the outer surface. 6. Placing ears and front glass and fix it with the nuts and packing. 7. Final inspection of Packaging.

C. Business partnership
Initially our business stared with four partners collectively formed the companies and each partners have share according to their investment as well as profit/loss distributed according to their investment. All the partners have 1 vote in meeting and any decision cannot implement without consent other partners.

 Collective partnership:
We have also make partnership with the different dealer of bike and showrooms which place our helmet in their display centre and also recommends customers who are purchasing bike also purchase helmet of our company.

Purpose of partnership
Purpose of partnership is that many partners can increase the amount of capital investing in business either one person investment. More over it expense of hiring directors of different department, all partners should be head of different department.

D. Quality Control
7QC tools always include:

D. Check Sheet is used to easily collect data.

Decision-making and actions are taken from the data.

E. Pareto Chart is used to define problems, to set their priority, to illustrate the problems
detected, and determine their frequency in the process.

F. Cause-and-Effect Diagram (Fishbone Diagram) is used to figure out any possible

causes of a problem. After the major causes are known, we can solve the problem accurately.

G. Histogram shows a bar chart of accumulated data and provides the easiest way to
evaluate the distribution of data.

H. Scatter Diagram is a graphical tool that plots many data points and shows a pattern of
correlation between two variables.

I. Flow Chart shows the process step by step and can sometimes identify an unnecessary
procedure.

J. Control Chart provides control limits which are generally three standard deviations
above and below average, whether or not our process is in control.

E. Customer Support
Customer Support Strategy We Support our customer through this way: To provide high quality accessible services which put people first To provide value for money by running our services

more efficiently To promote the economic, environmental and social

well-being of the district

Customer Support Obligation:

Verify that the issue is reproducible (if reproduction is reasonable and does not impact production environments). Provide all information necessary. Include the Support Case ID in all communications to JA & Co Support once the ID has been provided to the customer. Required Information to Open a Support Case Customer company name and point of contact. Contact information for point of contact (if not already in JA & Co Supports possession). A full description of the problem/concern and a complete list of steps for reproduction.

F. Growth Scope
The future of our business depends upon the growth of Motorbike Industry. The table below provides a detail of the last year sale of some big Motorbike manufacturers. The table shows that this industry is very potential and there is a large scope for future growth.

The Following Graph Is Showing Where Industry Stands.

.

Where the Helmet industry stand

Sales Volume

Hi Fly Helmet industry

Stages of industry

Financial Plan

Initials Current Investment

The amount for startup for this business is 2million. This amount will be initially invested by four directors which are also partners. And this amount will be equally invested by all four partners.

Capital Requirement For The Next 3-5 Years:

As mentioned earlier, the amount of capital we will be requiring to initiate our business would be 2 million rupees (20 LAKH rupees). This capital would be required for the first year of the business. The projecting capital requirement for the next 3-5 years would be somewhere around 50 LAKH rupees. As we expect losses in the first year, break-even point in the end 2nd year and profits by the 3rd year, so, keeping all the factors in mind, that will be our capital requirement for the next 3-5 years.

1. Sources And Uses Of Funds:

Our main source of loaning which would be fulfilling our capital requirement for the next 3-5 years would be Banks, Investors and Profits which we will be earning. These funds will be used in buying material, machinery, upgrading our R&D, Graphical and different heads of our business model as per described. The funds would be used in paying off employees salaries, office rent, buying equipment and refunding back those things which get defected before their guaranteed life.

Future Plans
Our future plans are as follows 2013 Break even

2014

Open one retail store for B2C business and gain other bike dealers in to the customers list.2 branch offices in Lahore, Faisalabad, and Multan.

2015

Open branches in all over the Punjab.

2016

Other offices in other major cities of Pakistan outside Punjab.

Overview Of The Financial Projections:

The financial projections have been prepared under the following assumptions:

Key Assumptions:

Increase in Cost of Raw Materials Increase in Staff Salaries Increase in Utilities (Electricity / Water / Gas) Increase in Office Expenses Depreciation

10 % per year 15 % per year 15 % per year

10 % per year 10% per year Straight line method

Financial Plan

Equity Share of HI FLY

Equity Share Rs 2,000,000

Startup Cost
Building & office Furniture& Fixture Advertisement Legal Expense Machinery & Equipment Other Assets Total Startup Cost 360,000 100,000 150,000 50,000 80000 500,000 1,560 ,000

Income Statement
8.3) Projected Income Statement

YEARS Sales GROSS PROFIT LESS: EXPENSES ADVERTISING LESS: ADMINISTRATIVE EXPENSES INSURANCE SALARIES (W-1) UTILITIES POSTAGE LEGAL&PROFESSIONAL SERVICES MISCELLANEOUS TOTAL EXPENSES OPERATING

2012 2,400,000 2,400,000

2013 2,880,000 2,880,000

2014 3,456,000 3,456,000

200,000

200,000

150,000

40,000 1,356,000 220,000 5,000 50,000

40,000 1,423,800 220,000 5,000 50,000

40,000 1,494,990 253,000 7,000 50,000

40,000 1,911,000

60,000 1,998,800

80,000 2,074,990

TAXABLE INCOME TAXES (35%)

489,000 (171,150)

881,200 (308,420)

1,381,010 (483,354)

NET INCOME

317,850

572,780

897,656

Operating Cost Of Hi Fly 1 Month Furniture Stationary& Equipment Utility Expenses Misc Expenses Total Expense 25,000 3500 63,500 220,000 42,000 392,000 20,000 15,000 1 Year 100,000 30,000

Cash Flow Statement YEAR Cash On Hand Revenues Total Inflows Expenses ADVERTISING 200,000 200,000 150,000 2012 200,000 317,850 517,850 2013 200,000 572,780 972,780 2014 200,000 897,656 1,097,656

INSURANCE MISCELLANEOUS

40,000 40,000

40,000 60,000

40,000 80,000

Total Expenses Start-Up Costs Total Outflow Net Cash Bank Loan Cash at End of Period

280,000 1,560,000 1,840,000 (1,322,150) (1,322,150)

300,000 300,000 672,780 672,780

270,000 270,000 827,656 827,656

8.5) Balance Sheet (Projected) Projected 2012 Assets Projected 2013 Projected 2014

Current Assets CASH Inventory Prepaid expenses Total Assets Current 200,000 2,031,000 2,231,000 200,000 2,234,100 2,434,100 200,000 2,457,510 2,657,510

Fixed Assets Machinery equipment Furniture fixtures Depreciation Total Fixed Assets (net depreciation) of 45,000 255,000 61,500 348,500 78,000 442,000 & 100,000 110,000 120,000 & 200,000 300,000 400,000

TOTAL Assets

2,831,000

3,254,100

3,697,510

Liabilities Equity

and

Invested capital

2,000,000

2,000,000

2,000,000

Current Liabilities Creditors Bills payables 800,000 31,000 Total Liabilities Current 831,000 1,184,000 70,100 1,254,100 1,587,010 110,500 1,697,510

Total Liabilities

2,831,000

3,254,100

3,697,510

Working

W-1 = Salaries of Forming Staff

No. Of Employees

Yearly Salaries

Jobs Director Salaries Sales Force @ 10,000 Marketers @ 10,000 Worker @ 7500 Sweeper @ 7000 4 2 2 4 1 240,000 240,000 360,000 84000

Total

13

924,000.00

Breakeven Analysis
Breakeven in rupees = Fixed Cost / Contribution Margin Ratio Contribution Margin Ratio = Sale Variable Cost Sale = 2,400,000 1,556,000 2,400,000 = 844,000 2,400,000 Contribution Margin Ratio = 0.352 * Variable cost = admin exp. + marketing exp.

Breakeven in rupees = Fixed Cost / Contribution Margin Ratio = 720,000 / 0.352 Breakeven = 2,04,545.5 rupees

Break Even Analysis:

As the Hi Fly is a company that is providing its product so its sales depends on the number of customers that would attain its services. This is the grounds reason why its sales or profits would not increase in a normal manner but would diverge in an uneven pattern with the number of consumers would vary. As there is no consistency in the number of customers so the company will not meet the breakeven point. The following graph shows how the company will perform in the following years.

Sales

Year

The above graph shows that there could be an increase in the revenue but the company may not reach the breakeven point.

Exit Strategy
Hi Fly after analyzing every risk and exit ways of the business have devised an exit strategy in the case if the business plan does not work or either goes to investors. We have also made certain clauses to recover the cost which would have been incurred on the project. The exit strategies of Hi Fly are as follow:

Legal documents of partnership will be signed by the partners that partnership will not be resolve until 5 years. After five years if any partner wants to exit then he has to inform to the organization at least 1 year before. If any partner exits from the business, he or she will get his or her share after 3 years. In case of losses every partner will be just liable for their share in organization. In case of winding up the organization amount received from sale of asset will be divided among partners and investors according to their shares.

Critical Risk Factor

Critical Risk
All businesses involve factors of risk, which cannot be eliminated but can be reduced to an extent. Profitability of a business lies beyond risk if exploited as an opportunity and if risk is eliminated there is no opportunity for profit. Rather than eliminate risk one needs to control or minimize those risks that are undesirable. Through risk management one can usually reduce price & improve quality of product (or services) variability and improve ones profit margin.

A. Management Risks:
The management risks refer to the risk that the members of the management team may divert their attentions or goals to their individual ones rather than the organizational ones. All the partners have abided by the rules and cannot break the terms and conditions mentioned in the partnership agreement. All the partners are responsible for the debts and obligations of the firm and the partnership agreement is valid for five years. In order to avoid such risk the firm has a flatter structure so that there is a two way flow of information so that matters can be handled and can be solved before they become worse and cannot be handled. On the other hand, the management team will be provided allowances, bonuses, and other financial and non-financial awards in order to prevent the employees from diverting to individual goals.

B. Marketing Risk:
The marketing risk is the economic instability because of which the prices of the manufacturing material rise out of budget. Initially we would really have to focus on our costs and maintain stability in providing services so that there would be no additional burden on the investors. There are many issues surrounding marketing and marketing decisions.

First and foremost are unpredictable and unstable prices and the inability to accurately forecast market prices. This uncertainty creates a high level of risk. Improving information and our understanding of the marketing process can be of some help. Changes in the national and world economy drive consumer demand and determine the economic environment we must face. This can be positive or negative. Consumer response to prices is not consistent over time. It is important to stay current of consumer tastes and preferences and take advantage of them.

C. Operating Risk:
A form of risk that summarizes the risks a company or firm undertakes when it attempts to operate within a given field or industry. Operational risk is the risk that is not inherent in financial, systematic or market-wide risk. It is the risk remaining after determining financing and systematic risk, and includes risks resulting from breakdowns in internal procedures, people and systems. Operational risk can be summarized as human risk; it is the risk of business operations failing due to human error. Operational risk will change from industry to industry, and is an important consideration to make when looking at potential investment decisions. Industries with lower human interaction are likely to have lower operational risk. Our operational risk can be high if we dont take care of the labor and first line employees. But as the organization has a flatter structure it is easy to care of the problems before they can turn into huge blunders.

D. Financial Risk:
Financial risks refer to risk that a company may face while it has not been prepared for it. In order to deal with such financial risks one should be fully aware of all the aspects that can cause tragedy. We deal with a number of financial risks by taking careful measures which are as follows: We have not taken any loan from the bank or any other company as all the partners are providing the capital finance for the

company initially. But as the company would make use of the resources thus using the capital it would need finance for providing further services. It would require funds from banks and other finance providing companies. If our company does not meet its target of the forecasted sales (services) then it would increase the price of its services in order to reach its breakeven at least. If all the business receives a big loss it will cover that lost by the help of all the members combined effort. If the any member of the management team tries to commit a fraud that is taking into his account a large amount of money without the companys permission then strict measures involving the law would be taken. The company would be insured in case any disaster comes or the company faces real time problems such as a fire or an earthquake comes and cause real damage.

E. Intellectual Property Infringement:

We have applied for all the necessary intellectual property rights for the patents and trademarks of Hi Fly in order to prevent bad intentions from copying our ideas. Under the law of Pakistan no one is allowed to copy any of the trademarks or illegally use our services. In order to prevent such a case we will be protecting our data by taking protective measures.

1. PanaFlex

2. Hi- Fly Helmet Models

3. Pamphlet