Business Plan On

The Sports Illustrated

(Weekly magazine publishing house)

Completed in partial fulfillment of project work assigned in Entrepreneur Development Course Curicula

Vivek Sharma

40390

Vishal Mandokhot Ankit Kalra Mohit Sachdeva

40370 40321 40354

Index

The Executive summary Vision and Mission Statement Business and Industry Profile Business Strategy Description of Company Product/Service Marketing Strategy Location and Layout Competitor Analysis Description of the Management Team Plan of Operation The Loan or Investment Proposal Appendix o Income Statement o Balance Sheet o Cash Flow Statement o Organization Chart o Layout Plan

2 4 5 7 8 10 13 14 16 19 20 20 21 22 23 24 25

Executive Summary Company Name, Address and Phone numbers: The Sports Illustrated Bhawan 1234 Shivaji Lane New Delhi 110007 Names, addresses, and phone numbers of key persons: 1. Ankit Kalra Chief Executive Officer & Member, Board of Directors R.P-48, Pitampura New Delhi 110034 +91-9899227406 2. Vivek Sharma Chief Financial Officer & Member, Board of Directors #232, G.B. Pant Bhawan, A-10, Sector 62, Noida 201301 +91-9425148400 3. Vishal Mandokhot Chief Operating Officer & Chairman, Board of Directors #332, G.B. Pant Bhawan, A-10, Sector 62, Noida 201301 +91- 9911099110 4. Mohit Sachdeva Managing Director & Member, Board of Directors K 16, Kavinagar Delhi +91-989784626

Business and Market Description: The business of The Sports Illustrated caters to filling the void of a national level Sports magazine, and to make sports news in Common mans(AAM AADMI) reach is objective of this publication. We at Sports Illustrated aim to profit from the till now single handedly dominated niche market of the Indian sports and hence to provide the sports news to everyone in cheapest possible price as compared to the sole competitor. The company deals with the publication of sports Magazine, which provide a platform to younger generation to bring up their talent and also to make people aware about latest happenings in field of sports. The trend of Sports Magazine is already popular in many countries in the Western world. With the growing number of junta showing their interest in wide horizons of sports, we wish to capitalize on this market and to give them a medium through which they can discuss on issues and are exposed to the latest happenings in the field of sports. We aim to develop a large reader base by competing with our competitors on various accounts to be discussed later in details. Strategy Overview: Our main strategies employed to counter the present competition offered is capturing a part of market and gaining trust. Under the market share, we aim to capture maximum number of schools and colleges to have our magazine in their libraries. By giving attractive offers, free samples, pre deal magazines, and concession schemes for Govt. schools and by conducting workshops. We plan to gather maximum number of schools in our customer list. Financial Request and Allocation of Finances: The Sports Illustrated requires a sum of Rs.40, 00,000 (40 Lacs) to ensure smooth operation and establishment of the business, major chunk of it would be required to establish necessary infrastructure. This money would be allocated as per our financial plan to ensure a timely repayment. This includes payment of initial salary to employees, advertising costs, location and layout costs and production costs. We have decided to go to an Angel for helping us up in initial setup of the required infrastructure.

Vision and Mission Statement People dont always follow leaders; often they follow a focusing vision and mission promoted by a leader. When you have these focusing goals, critical teams within the organization collaborate effectively to solve challenges faced by todays evolving organizations. At the Sports Illustrated, our vision and mission reflect a commitment to our customer, partners and employees. Our Vision The Sports Illustrated shall be the premier sports magazine in India by setting new standards of publications in the sports, giving the sports journalism a new dimensions altogether, and to provide a reasonable cost quality sports weekly magazine to all readers. Our Mission The Sports Illustrated enables our readers to not only read and follow a particular sporting event, but also rather enjoy reading it. We publish only what is true. In due process, we want to popularize all sporting events in India.

Business and Industry Profile The business is a start-up from the scratch venture wherein we seek an angel investor to finance us to enter into the magazine publication Business. The company goals and objectives can be summarized as follows: A. Operational Goals: i. To launch the first magazine in all key cities in mid-April 09 ii. To achieve circulation of 9 million in 2 years iii. To expand business and publish from the 5 metro cities within 5 years iv. To release Sports Encyclopedia, A collectors edition within an year of its launch which coincides with Commonwealth World Cup. B. Financial Goals: i. To pay back initial investment in 5-6 years ii. To reach break-even point within 2 years iii. To achieve profits of Rs.6,00,000 in 2 years with at least 20% growth rate per annum for at least 10 years. C. Other Goals: i. To have at least 20 wholesale dealerships across India by earlyJune 2009 ii. To start Year Book based publications by 3 Years. Industry Analysis The sports Magazine is a new concept in the Indian Market, with currently just a very few producing it. Apart from these major sports magazines, there are a few small players that neither have a wide consumer base nor the resources to compete with the so-called Big Guns in the industry. Since the magazines having a sports section are not sufficient enough to cater to all sports happenings within a week and is less known in many cities and this is one of the major advantages for a new player with adequate financial resources. The industry is very viable and has got infinite scope as owing to the growing popularity of sports, attributed by print media as well as other media forms. This is the very reason why the sports magazine published in the tabloid form are gaining a lot of readers, which are published on a
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weekly basis. These sports magazines are currently filled with lots of advertisements, which is a major drawback. With the increasing literacy rate the youth is left devoid of the exposure to this outer world of sports how tos and happenings. The industry has many key success factors such as:
i.

Subscription benefits: Schools which subscribe to an issue of our sports magazine before its launch are charged less. Those who look for longer subscriptions are provided with Workshops, Sponsorships, and free pre-deal copies of our magazine. Sponsored sports events: Those schools/colleges which are renowned and bring back to us a very heavy share of market, we would also sponsor their sports events and in general, would sponsor some national sporting events so as to gain publicity, will have a special column where they can publicize there school or any event conducted by them, for free or at a very subsidized rate. Year Book: Yearbook publication (which would be our platinum collectors edition) based benefits will also be available to our valued customers where they will be charged very reasonably.

ii.

iii.

Business Strategy The Sports Illustrated desires an extremely positive image in the eyes of consumers. We aspire to be admired greatly by our customers for the quality, innovation, originality and authentic information that our sports magazine provides. We desire that The Sports Illustrated sets new standards for sports media production in India. SWOT Analysis Strengths: Our strengths include the high level of quality standards we aim for our product, the creative potential of our team of Editors and designers and the worth every penny nature of our sports magazine. Weaknesses: Largely due to financial constraints, we cannot advertise using every possible avenue or launch extensively throughout the country. As we are starting fresh with no other business experience this can be a reason for our slow start, besides competition from existing magazine would always be the largest challenge to us. Opportunities: The existing publishers of sports magazine are not exactly publishing, what we intend to do. Our sports magazine will be a completely new product that is not present in the market. So even though if we have our competitors follow the same trend as ours, it would take them a lot of time to capture the market share as our niche will be different from theirs. Threats: Our major threats are the Newspapers that are publishing sports magazine currently. These sports magazines are not particularly targeted, but if they do so, it can be a problem to our business. Besides they already have well established chains of reporters and journalists and we have to begin right fr the scratch.

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Competitive Strategy Our aim is to capture maximum number of private schools, gyms, sports clubs and its members, which are looking forward in excelling in the field of education, general knowledge and other curricular activities and who are active in watching /playing sports and want to keep themselves up to date about the happenings of sports world. Besides we also want to expand our niche customers by brining the magazine in the hands of novice in the sports category by inculcating the habit of reading in students. We are planning to do this by providing the free samples to the would be expanding customer base. Company Products and Services Product Description Our product is a magazine which can be divided into two categories, sponsored and General. Both these versions will be printed under the brand name The Sports Illustrated. The sponsored section of sports weekly will be financed fully by the institution who wants its space in publication of sports events and it will also be providing the content. The magazine will be provided in the schools, gyms at a subsidized rate with concessions(less than the Printed Rate). The sports articles would be approved by our editorial committee (collection of renowned national/international sportsmen), before going for the print. In the general section of the sports magazine would have the collection of space deserving sporting news/stories/sections and the content would be chosen by the questionnaires, and out of common discussion of our eminent editorial board. In this case our editors and designers come into picture. The main page will have interviews of people excelling in the field of sporting events which are having less publicity or popularity than their few lucky siblings. Since no particular organization is involved, the sponsors come into picture. These sponsors pay for the ads that we put in the magazine, and this is how we will be able to cover up the expenses of production.

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Trademark Protection We plan to get our trademarks registered for all kinds of publication, which would help strengthen our vision of becoming the premier illustrated sports magazine. Production Process Description The production process involves the managers, editors, layout designers, system administrators. The quality of the printing and the layouts, which are themed properly depending on the content, is managed at this step by the employees at The Sports Illustrated Bhawan. The other sports magazines only have these kinds of production process, as the sponsored magazine contents are finalized at the sponsoring organization level. The sponsors are contacted, and dealt with by the CMO and his team. Layouts are made up, and the true-copies are sent to the board of directors who approve the templates, and finally, content is sent to printing. Future Products Our Future Plans includes publishing a complete monthly sports magazine, which would carry forward the good work from the weekly magazine and add new dimensions to sports publications. We also wish to provide a search engine on our website that would search for respective games information achieve and the star players in that event in India and abroad as well as the nearest places where the customers can avail the particular sports training, and the events which are scheduled to take place in particular month or so. We can also organize some sports quiz and competitions to build on our brand. We can give some freebies like sports star posters and or specialized sports encyclopedia on a particular sport with every edition.

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Marketing Strategy Target Markets Our primary customers would be Schools, Under-Graduate colleges, Gyms and sporting clubs etc across India. We have selected the following key cities/towns to advertise and promote our comics based on our study into the demographic concentration and low distribution costs here: New Delhi Noida Kolkata Mumbai Pune Bangalore Chennai Bhopal Some of these cities present great returns due to unavailability or delayed availability of our competitors. But as for our dream plans, we would try to encash on the upcoming Commonwealth games to capture the market. We are also planning the highly developing cities like Durg/Bhilai, Noida, Faridabad, Gurgaon, Hyderabaad, Mysore etc where there are highly educated people who can spend on these magazines. Also, in such cities, Market is immense, and the competition is negligible. Besides, If we can capture these markets, then we can be assured of regular returns. Initial price of our magazine would be kept low so as to expand the customer base, and then to gradually increase it by increasing the quality of the magazine in a long run. We are planning to use recycled paper so as to protect trees, and hence would claim for some reduction in costs of the raw material, and we would also demand some rebate from the government for the same. Our marketing motto is Market is immense; you just need to broaden your vision

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Customer Motivation Initially, we anticipate attracting customer interest via our advertisements and a few guest lectures, enlightening the students about importance of academic publications. Later we tone down the publicity buildup and rely primarily on word-of-mouth advertising and our online advertising strategy. We believe that brand building is high return investment in long run. The freebies, free promotional copies, more of information and content, and reduced advertisements, Standards of the magazine matching international standards would be some of the other factors that we perceive would be acting as motivation for the customers. Market Size and Trends The market size at the present might not be huge, but as seen in western countries, it is expected to grow. As most scholars these days cannot find enough material to read about sports, due to lack of enthusiasm, hence we are targeting highly developing cities as in these cities, people are ready to experiment with the magazines, but they need more options to choose from, and they would readily prefer better sports magazine. Most people might prefer google.com for the same, but even Google fails to answer (in depth) when it comes to sports in desi scenario as well as providing collection of up to date sports activities over the globe. We at The Sports Illustrated believe in setting trends and not following them, The Sports Illustrated would create a market trend of its own and we are looking forward for some good competitors and alliances in near future, as Competition creates better products, alliances create better companies. Advertising and Promotion The business that considers itself immune to the necessity for advertising sooner or later finds itself immune to business, so even for a sports magazine we must advertise. We plan to do so via Notices on colleges/organizations Notice boards Pamphlets around the sporting complexes , stadiums, gyms etc Online Advertisements
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 Fliers at students hangouts as Barista, McDonalds, book caf etc. Organizing seminars on Sports Publications by sports bigwigs etc. Word-of-mouth based promotion We plan to use most of these strategies at the time of launch of our company. However, once we have gained a decent customer base, we plan to tone down the publicity buildup and rely primarily on word-of-mouth advertising and our online advertising strategy. Pricing Pricing issue is dealt in such a way that it is affordable to all the subscribers. The prices wont be so low, which may raise questions on the quality of the newsletter. The pricing will cover all the production cost, the labor required. Weekly Sports Illustrated: Sports Illustrated(Collectors edition): Distribution Strategy Distribution is the key area in this business. We have a distribution team, which would take care of proper dispatch of newsletters in their respective areas. There would be 50 people, each be assigned an area to operate in and would be provided with enough resources ensure timely deliveries. The person would be responsible for the smooth transportation, handling, packaging and delivery of the magazines to the retail outlets. We would also keep evaluating them by continuous evaluation as well as feedback from the random customers. Rs.20.0 per Copy Rs.200 per Copy

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Location and Layout Location The location of our offices does not affect the customer since only the production has to take place at the workplace. The location has been chosen as Wazirpur industrial area keeping in mind the low cost of living, cheap lease rates and a big factor that its located in an industrial area so that the raw materials availability will be smooth as well as the labour will be cheap. Besides proximity to the metro station adds to the benefit. which is important as many of our employees would be college students. The lease rates for the rented offices have been calculated as Rs.30,000/month. Since the production process is flexible and does not require much space, we expect this location to suffice even with probable future increase in staff. Being in a metropolis, Delhi, acquiring supplies poses no problems. The employee wage rates are location independent and are calculated as per the industry standard to be Rs.8,000/month. Layout The layout chosen is provided in Appendix D. The layout suffices for any new employee additions, as can be seen. We do not have requirements for a large sized office since the production process does not require much area. We have therefore chosen a layout size of 1000 square feet.

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Competitor Analysis Existing Competitors The existing competitors in the business are primarily The Hindu. The product launched by them are Sport Star, Weekly round up of Sport related news, articles et al., goes every week with all editions on Monday .. Sport Star Established: 1977 Owned By: Bennet, Coleman and Company Product delivered: Education Times Around 750 employees: includes editors, designers, and illustrators. Sells around 2.7 million copies. Around 8.4 million readers in general ( No particular Age Group ). Currently delivered to all major metropolitan cities. Competitor Strengths: The competitors have an edge over us in some areas . They are: 1. They have been in the business from quite an appreciable amount of time. Thus they have greater experience and network which helps them a lot in carrying the business. 2. As a result of large network they have better source of information which is quicker and being very old and obsolete it is more reliable which is again conducive for better information. 3. Again because of spending more no. of years in the business they have better consumer relationships thus it I intricate to dissuade the consumer and convince them to use our product. 4. As a result of larger business and and more experienced they more funds and can easily raise large amount of money t any time thus they can take more risks and experiment more.

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Competitor Weaknesses: 1. The biggest weakness of the competitor is their attitude towards the bsiness. Due to their global reach they might not be able to catter to the needs of local people. 2. As the strength of the company increases the company is more susceptible to differernce in views . 3. Our publishing house is purely Indian and thus we can provide the users about better information about the domestic games than the global magazine. 4. If the no. of people is lesser as in our case we can look towards the employee satisfaction so they they work in more complacent way and produce better output. One of the major weaknesses of existing competitors is their approach to the business itself. We intend to bank upon this attitude and launch an extensive promotional campaign to seize the market for our Newsletter. Since the current target readers to these Newsletters that the Newspapers produce are people of the Age group 22+, this might help us to gain readers of the age group below this age group. The current school and college going children comprise to 60% of the population of India. Potential Competitors Our potential competitors include Major Newspapers like Sport Star from the Hindu Group . Also, potential competitors could be other start-ups who enter the industry like us. New competition wouldnt affect us much if it is another start-up like us since we are taking precautions such as advertising to the utmost of our capabilities. However, Newspapers as the above mentioned in the industry could affect our business because of their huge financial backing and are already in the Market. It is however a very impractical assumption that they would enter into Publishing Education Magazines, and Producing Year Books for Schools.

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Description of Management Team Our team of managers consists of, Chief Executive Officer The responsibilities of the CEO include day-to-day management of the companys activities, managing the advertising plans, etc. Chief Operating Officer The COO is the in-charge officer and the final decision making authority on the operations of the company. This includes developing new strategies and calculating market suitability for new characters. Chief Financial Officer It is the responsibility of the CFO to manage the financial aspects of the company. The loans, expenditures and investments require an approval from the CFO. Managing Director The MD of the company controls the daily workings of the company and is in charge of getting advertisers for the magazine, quality control, making contact with publishers, distribution management, etc. Executive Director The executive director is in charge of managing the team of employees, organizing and managing collective brainstorming sessions, employee recruitments and dealings, getting interviews and day to day news, etc. Chief Marketing Officer The CMO is responsible for all the marketing, advertising, and distributions related issues. Getting Sponsors dealing with the negotiations related to prices is will be dealt by CMO. Our employee team consists of,
Junior Students Reporter

The Junior Reporter job is to frame and collect the articles about respective colleges. There will be maximum of two reporters in college. They will be working free ad thus no salary will be given. These articles

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would be scrutinized by our team of managers, the rest of the employees and through surveys of limited extent. Editors The Editors will read out the whole article and will check the corrections in the article. For this, he may use the computer. His salary will be Rs.13, 000 per month. Journalisms Students (Interns) They will be working as assistant layout designer, will be compiling information and will be in contact team. Maximum of five will be given this work. They will be awarded Certificates for their work. System Professionals They will be managing the site and will be working as a System Administrator and they will be collecting the feedbacks from the clients. .Only 2 will be employed. Their salary will be Rs.9,000-11,000 per month. Layout Designer They will be working on the design of the layout of the articles, will be compiling information and will be managing the site of the company. Max of two will be employed. They will be given Rs.8, 000 -10,000. Contact Team and distribution Team They will be collecting the feedback from the clients and will be maintaining all the contacts (colleges, printing press, sponsors, etc.) and will be providing all kind of help. Max of 5 will be working. Their salary will be Rs.3000-5000 per month. Reporting Team They will be gathering Information and will be writing articles and will performing other tasks as well. They will be getting Rs.9000-11000 per month as a salary. Maximum of 5 will be working in this team. Accountant They will be managing all the accounts of the company. Only 2 will be employed. Salary will range between Rs.9000 11000 per month.

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Plan of Operation Form of Ownership We have chosen a partnership form of ownership. We feel this is appropriate since we can contribute to the firm by way of our managerial skills and initial investment. Also, earning a B.Tech. Degree has helped us tap our creative potential and hence we can use technological advancements to produce high-quality, economical to publish Magazines. Company Structure The company structure is depicted via an organization chart in Appendix C. The corporate structure of Dharma Publications is as follows, The Board of Directors comprising of the CEO, COO, CFO, MD, ED and CMO The Employees comprising of the Editors, Layout Designers, System Administrator, Accountant, supervisors, Interviewers/reporters, Distributors, Contact/ help desk Executives.

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Loan or Investment Proposal Amount Requested: Rs.40, 00,000 (Forty Lacs only) Purpose and uses of funds We plan to use these funds for the following, o o o o o o o Employee recruitment costs Payment of employee salaries Advertising costs Location and layout costs Production and Equipment costs Maintenance costs Electricity and other miscellaneous costs

Repayment Schedule We aspire to pay back the investor in about 6 years (5 equal installments of Rs.8, 00,000 + interests) starting from the end of 2nd year of operation. In doing so, we have calculated a cushion of about Rs.2, 00,000. Timetable for implementing plan and launching the business

To implement plan and get initial investment by end-January 2007 To recruit employees by end-Feb 07 To set up offices by end-Feb 07 To start looking for client for first magazine by mid-March 08 To start production of magazine by end-March 08 To put out advertisements by early-April 08 To launch the first magazine mid-April08

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Income Statement EDITI ONS Sales Less cost of goods sold Gross Profit on Sales Our Profit(Gross Profit/2) Less General Operating Expenses Less Depreciation Expense Operating Income Other Income Earning Before Interest and Tax Less Interest Expense Earning Before Tax Less Taxes Net Earning Dividends Paid Retained Earnings 29% 9 2008 2009 1984000 2480000 24 0.0 0.0 4464000 .0162000.0 1537600 2463800 0.0 0.0 7688000 1231900 .0 0.0 2010 244800 00.0 744000 0.0 4000000 -96782.2 170400 00.0 852000 0.0 328225 3043018 2934408 0 http://siadipp.nic.in/publicat/invpub/taxation - 65700 46215 38683 .htm 4579282 9338377. 519906 .0 0 7.0 + 50000.0 60000.0 80000.0 4629282 9398377. 527906 .0 0 7.0 360000. 360000. http://www.bankofbaroda.co 0360000.0 0 m/int_adv.asp 4269282 9038377. 491906 .0 0 7.0 1238091 2621129. 142652 http://pages.stern.nyu.edu/~adamodar/pdfil .8 3 9.4 es/eqnotes/kpmgtaxrates.pdf 3031190 6417247. 349253 .2 7 7.6 0.0 0.0 0.0 3031190 6417247. 349253 .2 7 7.6

Extra Expenses

Money In Bank Interest SUM 8

-96782.2 1033540. 6 956982. 1130322. 122074 0 8 8.6 76558.5 90425.82 97659.8 6 24 8819 131840 8.5

YEAR 1 2008 Month Cities Towns

1 1500 1000 23000

2 150 0 100 0 230 00

3 200 0 150 0 340 00 413 33 20 4.5

4 5 6 200 0 2500 3000 150 0 2000 2000 340 00 45000 46000

7 3500 2000 47000

8 3500 2000 47000

9 4000 2000 48000

10 4500 2000 49000

11 5000 2000 50000

12 5000 2000 50000

Average Yearly Sales selling cost production cost per magazine YEAR 2 2009 Month

24
1 2 3 4 5 6 7 8 9 10 11 12

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Balance Sheet
Current Assets 2006 INR 344000 2007 INR 2008 INR

Assets Current Assets Cash and cashequivalents Accounts Receivable Inventory Total Current Assets Fixed Assets Equipment and Fixtures Depreciation Fixed Assets (less depreciation) Total Assets Liabilities Current Liabilities Accounts Payable Taxes Payable Long Term Debt Total Liabilities Net Worth

4000000.0 3100000.0 7688000.0 9000000.0 2750.0 2750.0 11690750.0 12102750.0 344000 253300.0 65700 46215 278300.0 165785 11969050.0 12268535.0

4400000.0 10416000.0 3500.0 14819500.0 175585.0 38683 108192 14927692.0

2546018 2574408 1258681.7 1755102.3 4000000.0 3200000.0 7804699.7 7529510.3 4164350.3 4739024.7

2982250 2057827.5 2400000.0 7440077.5 7487614.5

Cash Flow Statement

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2008 Earnings Non-cash Adjustments: Depreciation Other Adjustments to Earnings Net Cash provided from Operations Net Cash provided from Financing Additions to property, plant and equipment Net Cash used for Investing Change in cash and equivalents during year Cash and Equivalents, beginning of year Cash and Equivalents, end of year 3081600.3

2009 4296974.7

2010 5038129.5

65700 0 3147300.3 0 -344000 -344000

46215 0 4343189.7 0 -10000 -10000

38683 0 5076812.5 0 -10000 -10000

2803300.3 4333189.7 5066812.5 4000000 6803300.3 11136490.0 6803300.3 11136490.0 16203302.5

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