Post on 07-Apr-2018
transcript
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FINAL PROJECT
PROJECT MANAGEMENT
Submitted
By
ARSLAN SHAUKAT ( MBA-E, 2111058)
SUBMITTED TO: MR. Altaf-Ur-Rehman
NATIONAL COLLEGE OF BUSINESS
ADMINISTRATION & ECONOMICS
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Executive summary:
The plan is to open up a cell phone shop that is going to deal in all kind of cell
phones, new and used, like Nokia, Samsung, Motorola and LG made. The shop also deals
in all their accessories as well like batteries, chargers, and memory cards etc.
Furthermore, in order to attract the customers, the shop also deals in easy loads and
scratch cards.
The location of the shop is wisely selected in the area of Defense Phase V as it is
going to earn the benefits of being the only cell phone shop of the area. The shop solely
enjoys the monopoly, as there are no other shops in the same aspect, and thus the shop
can earn good by setting high prices. The location also provides a huge car parking area
that eases the customers the most. There are several other beneficial aspects of the
location as well that includes the area being densely populated.
The shop uses both above the line and below the line advertising strategies. With
the courtesy of the cable operator, footage is show about the shop opening. Secondly,
stuff like printed shopping bags and key chains etc. are given to the customers. Apart, a
junk ad is also to be distributed by the newspaper hawkers by enclosing it with any
newspaper.
The final goal is to make this business a franchise of some good cell phone dealer
like Mz (Mobile Zone) or United.
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Business Descriptions:
The suitable name for a Cell Phone shop would be THE MOBILE SHOP as it
going to be the only shop in that aspect of the area. Apart, the name being a little
controversial also enables it get some fame for the shop. The location being decided for
this venture is in Defense Phase V as the area is densely populated residentially and as
from the commercial aspect the area is still being developed. Several other offices like
traveling agencies, real estate agencies, banks etc are already operational.
The shop facilitates its customer with all kind of cell phones, new and used, like
Nokia, Samsung, Motorola and LG made. The shop also deals in all their accessories as
well like batteries, chargers, and memory cards etc. Furthermore, in order to attract the
customers, the shop also facilitates with easy loads and scratch cards.
This venture possess a high potential of earning good profits as it is going to
enjoy the monopoly because there are no other shops of the same aspect as this one is
going to be.
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Market:
The shop uses both, above the line and below the line advertising methods. For
above the line, footage is to be shown on cable channels with the courtesy of cable
operator of that area.
Defence Housing Authority
Location: Lahore
Population 50,000
Area 852 acresHouses Built: 13,868 Residential (Covering Phase II & IV)
Courtesy: Wikipedia.
The potential customers of the shop are those who either already have a cell
phone and want any of its accessories or ones who wish to buy one.
The total population of the area is 50k approx. Based on observations the
following assumptions are made:
An average of 1500 people travel through the road on which the shop is located
at. Out of which around 700 makes a stop at the commercial spot, 300 would be attracted
toward this shop.250 think they have the potential to shop and finally about 200 makes a
purchase from the shop.
After every ten minutes a customer is expected, especially after five in the
evening and each customer is to be treated for around four to five minutes. The selling
procedure includes ensuring the customer that the purchase they make for the product
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values and the product works perfectly. After that the customer is fully satisfied, he is
provided with a copy of cash memo receipt.
As mentioned earlier as well, the shop enjoys the monopoly as being the only
shop of its own kind and thus the prices charged from the customers is a little above the
normal markets, like Gulberg, Mall Road etc, rates. In case if the competition arises, the
shop start selling its product with the guarantee of its own name as by the time the
competition arises the shop would be able to gain some goodwill.
Research, Design and Development:
The major research done for this venture was related to the financial aspects and
the location of the shop. These two factors enormously play a vital role for any retailers
business to succeed. A location was to be chosen that ensures a high rate of customers to
hit and get attracted toward the shop, the area should be densely populated and thus this
market is supposed to be one of the busiest markets in the whole major area.
As for the pricing and other aspects of the business are concerned, our own
experience from the shop that we have worked on enables me to get an exposure toward
all the pricing matters, estimating sales, and an overall view about how to manage a
mobile shop.
What we have observed is that an average of 1500 people travel through the road
on which the shop is located at. Out of which around 700 makes a stop at the commercial
spot, 200 would be attracted toward this shop. 250 think they have the potential to shop
and finally about 200 make a purchase from the shop.
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After every ten minutes a customer is expected, especially after five in the
evening and each customer is to be treated for around four to five minutes. The selling
procedure includes ensuring the customer that the purchase they make for the product
values and the product works perfectly. After that the customer is fully satisfied, he is
provided with a copy of cash memo receipt.
Manufacturing:
The shop is located in the heart of the commercial area of Defence Phase V Ext.
Factors that were considered before deciding upon the location were like the nearness to
the suppliers market, highly dense (populated) area, etc.
Following are the advantages of the current location of the shop:
1. Potential of being the only cell phone shop in the whole commercial
area.
2. Nearness to the suppliers market (wholesaler and importers)
3. Densely populated area as majority of the population lives in Villas
& their servants nearby smaller areas. Offices and few shops are on
the developing stage.
4. The location provides a huge car parking area that eases the most to
the people who wish to make a stop at the market.
5. Being one of the posh areas, the general public is quite well off and
shows a Non Bargaining attitude if the prices are tagged on the
products.
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6. The location also avails from the easy accessibility of almost every
sort of transportation say busses, taxi, autos, rent a car etc. along with
the fueling stations as well.
The shop space is of 10 by 30 and a height of 12. The shop is built at a
height of 3 from the ground that simply ensures the eye-catching display level to
the person walking on road. Flooring is already done with shiny marble tiles that
are simply going to set a good impression on who so ever comes in. The shop has
a strong shuttering and structure made of brick walls, and in general the overall
area is secure as well as few money changers surrounds the shop too.
Developing Project Plan:
It includes the WBS of our Project and it also includes the activities &
tasks to be undertaken on the Project. This WBS will help us to assess the
progress of the project.
Work Breakdown Structure (WBS) of Mobile Phone Shop
1. Market Survey
1.1 Area (Commercial)
1.2 Shop Area (Size)
1.3 Convenient to the Supplier Market (Wholesalers/Importers)
2. Resource Allocation
2.1 Self Funding
3. Civil Works
3.1 Bathroom
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3.1.1 Sewerage
3.1.2 Water Supply
3.2 Kitchen
3.2.1 Gas
3.3 Flooring
3.4 Wooden Display Boxes
3.5 Paint
3.6 Electricity Wires & Boxes
3.7 Board
3.7.1 Name Board
3.7.2 Printing
4. Locks
5. Lightening
5.1 Tube Lights
5.2 Frames
5.3 Energy Savers
5.4 Lamps
5.5 Fans
6. Fixtures
6.1 Front Counter
6.1.1 Glass
6.1.2 Wood
6.1.3 Mirror
6.2 Wall Hanging
6.2.1 Glass
6.2.2 Wood
6.3 Grilling
6.3.1 Hooks
7. Furnitures
7.1 Chair Type 1
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7.2 Chair Type 2
7.3 Stools
7.4 Tables
8. Water Dispenser
8.1 Bottles
8.2 Glasses
9. PTCL
9.1 Exchange
9.2 Sets
10. Air Conditioner
10.1 2 Tons (2 units)
10.2 1.5 Tons (3 units)
11. Ad for Salesman
11.1 Newspaper
11.2 Cable T.V
12. Show Case Dummies
12.1 Dummies
12.2 Stands
13. Contracting Suppliers
13.1 Mobiles
13.1.1 Wholesalers (Hafeez Center)
13.2 Mobile Cards & Easy Loads
13.2.1 All Telcos
13.3 Accessories
13.3.1 AMB
13.3.2 First Copy China (Import)
13.4 Civil Work Contractor
13.4.1 Bathroom
13.4.2 Kitchen
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13.4.3 Flooring
13.4.4 Wooden Display Boxes
13.4.5 Paint
13.4.6 Electricity Wires & Boxes
13.5 Electrician
13.5.1 UPS
13.6 Furniture, Lightening & Wood
13.6.1 Int. Light House
13.6.2 Naeem Traders
13.7 AC, Fans, Water Dispenser
13.7.1 Lahore Cooling Point
13.8 Stationary
13.8.1 Feroz Sons
13.9 Security Guards
13.9.1 Sutlaj Securities
13.10 Computers/Laptops
13.10.1 HP
14. Shop Selling Items
14.1 Cell Phones
14.1.1 Nokia
14.1.2 Samsung
14.1.3 Sony Ericson
14.1.4 China Phones
14.2 Charger
14.3 Hands free
14.4 Batteries
14.5 Memory Cards
14.6 Pouches
14.7 Casings
14.8 SW CDs
14.9 Key Pads
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14.10 Fancy Items
14.11 Infrared & Bluetooth Devices
14.12 USB Cables
15. Services
15.1 Easy Loads
15.1.1 All Telcos
15.2 Prepaid Cards
15.3 PTCL Cads
16. Bank Account on Shop Name
16.1 Bank Al Falah
17. Stationary17.1 Pens
17.2 Registers
17.3 Invoice Books
17.4 Staplers
17.5 Visiting Cards
17.6 Stamps/Pads
17.7 Calculators
17.8 Price Tag Machine
18. Security
18.1 Security Guards
18.2 Security Gadgets
19. Computers
19.1 Desktop (2)
19.2 Laptops (2)
19.3 Printers (2)
19.4 Scanners
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Developing Resource & Financial Plan:
The resource plan would be formed now and it will help us to allocate the
resources required to undertake each of the activities & tasks within the project.
Similar to resource plan we have made financial plan that would help us to
identify the quantity of money required for each stage in the project like total cost
of labor, equipment & materials.
It would help us with an understanding of forecast spending vs. actual
spending throughout the project. Below we have mentioned the labor, equipment
and materials and the money required to spend on it.
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Start up capital
Board Name Board 8000
Printing 1000Labor 2000 11000
Locks 450 450
Lightning Tube Lights 195
Frame 450
Energy Saver Lamps 340
Frame 80
Fans 2400
Labor 1000 4465
Fixtures Front Counter
Glass
Wood
MirrorLabor 18000
Wall hanging
Glass
Wood
Labor 12000
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Grilling
Grilling
Hooks
Labor 15000
Furniture Chairs type 1 900
Chairs type 2 600
Stools 750
Table 700 2950
Water Cooler 10000 10000
PTCL 2000 2000
News Paper Ad for salesman 1000 1000
Show Class Dummies Dummies 9000
Stands 1000 10000
Shop Selling Items Cell Phones 150000
Batteries 31500Chargers 15600
Handsfree 9000
Memory Cards 15000
Pouch 1 3000
Pouch 2 2000
Casing 1 3000
Casing 2 2000
Software CDs 1000
Keypads 500
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Fancy Items 1000
Infra red devices 2200
Bluetooth devices 2500
USB Cable/Cords 1800
MP3 6000
MP4 10000
Ez load sim Telenor 4000
Ez load sim Mobilink 4000Ez load sim U-pop 4000
Budget for used cell phones 30000
3 used mobiles for E-load 3000 301100
Bank A/c by shop name 10000 10000
Stationary
Ball Point Pen x 2 10
Sales Registers x 2 90
Stapler x 1 100
One hole punch machine x 1 90
Two hole punch machine x 1 120
Files x 4 60
Cash Memo x 2 100
Price Tag Roll x 2 110Price Tag Machine x 1 650
Calculator x 1 850
Visiting Cards x 1000 400
Rubber Stamps x 2 180
Ink Pad x 1 40 2800
Shop Acquisition Shop 1400000
Estate Agent Commission 6000 1406000
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Transportations Board 1000
Lightning 500
Fixtures 1000
Furniture 1000
Products 1000 4500 1811265
Miscellaneous 13735
TOTAL 1825000
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Management:
We will manage this whole venture because we are capable enough
to perform the core functions as well as able to deal with all the technical aspects
of the management as well. The reason is that we have already worked as a
salesman at a similar shop for one year in order to come up with a business of our
own in the same field. We are going to hire a salesman through a newspaper
advertisement and a servant/helper and a security guard, and also going to work
ourselves as well look after all the areas that need our considerations like making
purchases, clients queries, customers problems etc. throughout the venture the
staff plays a participative role in making major decisions, their opinion will be
asked and considered but we will be making the final decision what we feel like
benefiting in the long run regarding the venture.
Following is the advertisement to be published in newspaper for hiring a
salesman:
A cell phone shop located in Defence Phase V. requires the services of an
energetic salesman possessing a presentable personality. The candidate should
have at least 2 years of working experience in the same field. Preference would be
given to those residing near the area and having their own conveyance. For further
details call Arslan: 0333-1234567
Helper would be hired on reference. As far as security guard is concern, his hiring
would be done through a security service provider on mutually agreed conditions.
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All interviews would be conducted at a simple hotel, and the final candidates
would be directed toward the shop.
Following is supposed to be the ideally expected CVs of the candidates:
Salesman Servant/Helper Security guard
Name ? ? ? ? ? ? ? ? ?
Address Within 5 km square " "
Experience 2years or more NIL 1 year or more
Academics Inter / B.com Max 5th grade Matriculation
Religion Islam " "
Salary Expectations 6000 to 8000 3000 to 5000 6000 to 8000
Timing 1pm to 10 pm " "
Holidays Natural, Sunday, strike " "
Salary Decided 7000 4000 7000
Duties Client dealing Assisting Ensure safety
Developing Risk Plan:
There are several problems that can show up after the launch of the venture.
These might include arising of the competition, customer behavior and latest market
trends or even falling short of finance. What if it is a major flop? Sales projections are not
met. Unexpected costs increase, personal matters like health or family problems, all need
to be considered, and for those reasons following calculations are provided:
Risk Likelihood Consequences Intensity of Risk
Arising of Competition 0.3 0.7 0.21
Customer Behavior 0.2 0.6 0.12
Change in market trend 0.2 0.4 0.08
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Financing Lacks 0.3 0.6 0.18
Sales projections are not met 0.4 0.8 0.32
Being a Flop 0.2 0.9 0.18
Case 1: Arising of the competition.
In case if the competition arises, the shop starts selling all products on guarantee
on the name of the shop. By the time our competitor will form the shop would be able to
earn at least some goodwill. How this guarantee is treated? If the product does not work
properly, the customer is entitled to have a full replacement, after that he is fully satisfied
with the replacement, he is informed that if this replacement does not work, he is not
suppose to get further replacements. Value added gifts like a free casing or handsfree
would be provided with new cell phones.
Case II: Customer Behavior
In case if the customer buying behavior changes, for instance MP3/MP4 players
or any other gadgets like PDAs, the shop start purchasing those item from its next
purchase put those things on main display for sale.
Case III: Change in Market Trend
What if no used mobiles are being sold in the market, just because of the fear of
being a stolen/snatched property? The shop simply stops investing in them and makes no
further purchase. In short, the shop does every thing to coupe with the latest market trend.
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Case IV: Lacks of Finance
What if the actual financing exceeds the budgeted amount? The management has
a reserve of Three Hundred Thousands, kept in form of Prize Bonds, which are supposed
to be enough to deal with any unforeseen financial deficiencies.
Case V: Sales Projections are not met
In case if the sales projections are not met, heavy investment is done on marketing
and advertising campaign. More frequent the footage about the shop is to be shown on
cable channels. More direction boards are positioned and more junk ads are placed in the
newspaper.
Case VI: Being a Flop
No matter how much efforts are put to this venture, if this business does not
operates well with in its first six month, and is supposed to be shut down, an
advertisement in the newspaper is published stating Business for Sale. If that doesnt
work either all products displayed at shop can be sold at 2/3 rd price of the wholesale
market that almost equals the price that the management makes a purchase from the
importers (e.g. rate in wholesale = 35 and rate from importer = 25) thus making a minute
loss on the products. Now either the shop is sold, if it is going in making profit, else the
shop is give on rent. The person who rent is supposed to pay a nine-month security and a
three-month advance payment. The renting rate for the area of a shop like this is
Rs12000/month.the total amount is 144000.the shop is going to cover its cost, but in a
longer run.
Developing Financial Forecasting:
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Financing
Property Value 3000000
Mortgage @ 70% 210000016% annually
Monthly = 1.33 %
Starting amount 2100000
1st month 2127930
2nd month 2156231.469
1st installment 170625
Balance 1985606.469
3rd month 2012015.035
2nd installment 170625
Balance 1841390.035
4th month 1865880.523
3rd installment 170625
Balance 1695255.523
5th month 1717802.421
4th installment 170625
Balance 1547177.421
6th month 1567754.881
5th installment 170625
Balance 1397129.881
7th month 1415711.708
6th installment 170625
Balance 1245086.708
8th month 1261646.361
7th installment 170625
Balance 1091021.361
9th month 1105531.945
8th installment 170625
Balance 934906.9454
10th month 947341.2078
9th installment 170625
Balance 776716.2078
11th month 787046.5333
10th installment 170625
Balance 616421.5333
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12th month 624619.9397
11th installment 170625
Balance 453994.9397
13th month 460033.0724
12th installment 170625Balance 289408.0724
14th month 293257.1998
13th installment 170625
Balance 122632.1998
15th month 124263.208
14th installment * 124263.208
Balance 0
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Shop Operating Expenses
Monthly Daily
Salesman 7000 269.2308
Helper/Servant 4000 153.8462
Self 9000 346.1538
Drawings 45000 1730.769
Telephone 1300 50
Electricity 1300 50
Water Cann 2600 100
Security Guard 7000 270
Advertising on Cable (footage) 3000 115.3846
Miscellaneous 3800 146.1538
TOTAL 84000 3230.769Around 3230
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Sales Projection
Following data is anticipated on the basis of observations
Item # Of Customers Cost @ Total Cost Selling Price @ Total Sale
Cellphones 5 Avg 5000 25000 5300
Batteries 6 90 540 200
Chargers 15 30 450 100
Handsfree/ Earphones 8 30 240 120
Memory Cards 2 avg 500 1000 750
Pouch1 9 10 90 35
Pouch2 6 35 210 250
Casing1 12 30 360 80
Casing2 6 40 240 250
Software CDs 3 20 60 105
USB Cables/ Cords 1 45 45 220
Keypads 1 10 10 20
Fancy Items 1 100 100 250
Infra red devices 1 220 220 550
Blue tooth devices 1 250 250 550
MP3 Players 1 1500 1500 2000
Mp4 Players 3 2000 6000 2800
Used Mobiles 6 avg 3500 21000 4000
Ez loads
Telenor 12 avg 500 500 520
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Mobilink 20 avg 1000 1000 1040
Ufone 12 avg 500 500 520
Scratch Cards
telenor 12 avg 2000 2000 2060
mobilink 18 avg 2500 2500 2575
ufone 12 avg 2000 2000 2060
warid 27 avg 3500 3500 3605
Total # of Customers 200
TOTAL COST TOTAL SALE
69315
Estimation: 70,000
Total Profit 15,000
Working 26 days a month
Material Acquisition Cost
Transport 500
Damages 1200
Replacements 500Obsolesces 800 3000
Shop Operating Expenses
3250 3250
Total Operating Expenses
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NET PROFIT/ day
Total Profit - Total Operating Expenses
Monthly Profit 227500
0.75 170625For Monthly Bank P
0.25 56875For Shop Up grada
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Contract Suppliers:
For the initial maintenance of the shop, accessories, fixtures, lightening, furniture,
shop selling items, services, security, stationary & electronic items we have contracted
suppliers and the details has been given in WBS.
Perform Phase Review:
Now at the end we will be going to perform phase review to ensure that our
project went according to that planning
Conclusion:
In my opinion this venture is going to be a major success, the location of the shop
makes it win over the competitive edge, high customer strike rate, nearness to market,
and the prices being offered from the importers give an additional boost to earn good
profits.