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Acknowledgement
We would like to thank all the faculty members of Amrita School of Business, especially our
marketing faculty, Satheesh Krishnamurthy Sir, who provided us with immense help and
support. We would also like to thank each and every person who took part in our market
survey and helped make this project a reality. A special thanks to Baby Shop, Trivandrum
for sharing with us their experience in this field.
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Table of Contents
S. No. Page No.
Executive Summary 5
1. About the Company 61.1 Our Goals 6
1.2 Products 6
1.3 Profile of the Management Team 6
1.4 Company Location and Facilities 7
2. Situational Analysis 8
2.1 Market Summary 8
2.2 SWOT Analysis 9
2.3 Competition 10
2.4 Keys to Success 10
2.5 Critical Issues 10
2.6 Macro Environment 11
3. Marketing Strategy 12
3.1 Mission 12
3.2 Marketing Objectives 12
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3.3 Financial Objectives 12
3.4 Target Markets 12
3.5 Positioning 13
3.6 Strategies 13
3.7 Marketing Mix 14
3.8 Marketing Research 14
4. Financial, Budgets and Forecasts 16
4.1 Break Even Analysis 16
4.2 Sales Forecasts 17
4.3 Expense Forecasts 18
5. Demand Forecasts 19
5.1 Initial Marketing Strategies 21
6. Contingency Planning 22
7. References 23
8. Appendix 24
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Kidzeee is a one stop shop for children providing a variety of childrens books, toys and
clothes. Our target market are the children below the age of 14 and their parents. In this time
constrained era we provide the parents with a more convenient way of shopping and also
provide the children with a more enjoyable shopping experience.
We carried out a market survey to determine the exact needs of our target audience and to
help us take decisions about certain crucial factors such as location, pricing etc. We
conducted our survey in R.S Puram and Gandhipuram. We found out that there is a
reasonable demand for this type of a store in coimbatore and that R.S Puram was the most
preferred location.
The kids' wear market is growing at the rate of 10% per annum and the Indian toy sector is
growing at the rate of 15-20% every year. Besides the survey results being in our favour,
these statistics also seemed to suggest that there is a lot of potential for a store like Kidzeee.
Our store aims at providing quality products and customer satisfaction is our main focus. We
have a play area for children which enables them to have fun while shopping. We also
organise story telling, drawing, essay writing competitions etc every Sunday to help children
exhibit their talents.
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KIDZEEE
1. About the Company
Our shop would be a one stop shop for children below fifteen years of age. We will provide
them dress, toys and books.
1.1 Our Goals
We aim to become partners in childrens development and want to be recognised as the first
choice when childrens needs are concerned.
1.2 Products
Our primary area of concern would be dress, book, and toys for children. The dress category
includes all latest fashion and design .We are promoting toys that are being certified by all
recognised agencies for their safety and contents. Childrens books by eminent authors like
Enid Blyton will occupy high priority on our shelves.
As our survey revealed that parents are most dissatisfied about the choice of dresses available
in the city so we are giving them a benefit of custom made dress for their children. We have a
catalogue of design made by our own master tailor. Parents and children will have to choose
only the material and rest will be taken care of.
We want to be recognised as a Brand for children stores, therefore we are promoting only
branded goods. The brands on our shelf will include Ruff Kids, Weekender Kids, Jinni &
Johnny.
1.3 Profile of Management Team
There would be no compromise on eligibility and efficiency of management team. We have
divided the management areas amongst ourselves, which we believe we could contribute
significantly.
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Management team is given below:
Aditya.Nair.R (BTech.CS, MBA) RajivRamachandran(BTech EC, MBA)
Systems Coordinator Marketing
Amardeep Sodhi(BCom.,MBA) Manu Mooss(BTech.ME,MBA)
Finance and Accounts Operations
Vilas V.K.(BTech.Textile,MBA) Veena M.G(B.Sc.,MBA)
Sourcing Human Resource
The division of task is not rigid. There is great room for flexibility and information sharing
which would allow every member to update facts and details about every other area.
We plan to start the business in the month of January 2008 to benefit from the Pongal
Festival sales which is usually the best time.
1.4 Company Location and Facilities
Location: R.S. Puram 100 Feet Road,
Coimbatore.
Building Agreement: The agreement is such that we will pay an
advance of 10 lakhs, and we are liable to pay a
sum of Rs.25000 per month and this rent is
revised by Rs.5000 every 2yrs.
Facilities: The current building is a one storey building with
a floor area of about 3000sq.ft, located about 100
ft. away from the main road. The house has open
space around it which would serve as a parking
facility. There would be major alterations needed
which the owner has agreed to. The expense for
the alteration has to borne by us and it has to be
left after its useful life.There is enough space to
develop a mini-park in front of the store.
Operating Hours: 8 am- 9 pm , Sundays open.
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2. Situational Analysis
2.1 Market Summary
Research conducted by us has helped us obtain informations about the current market
situation which will help us in the setting up and running our enterprise successfully. It has
helped us to understand our target audience better which in turn will allow us to serve their
needs more effectively.
2.1.1 Market Demographics
Coimbatore is situated in the extreme west of Tamil Nadu, near the state of Kerala. It is
surrounded by mountains on the west, with reserve forests and the Nilgiri Biosphere Reserve
on the northern side. Its demography is as follows:
It has a population of 4.2 million. 11% of the population comprises of children below 6 yrs of age. The city has a multi-cultural society, mostly of cosmopolitan nature. It is one of the fastest growing cities in India and is known as the Manchester of the
South India
2.1.2 Market Needs
The survey conducted by us helped us to determine the market needs more efficiently. We
seek to fulfil the following needs that we found were important to our customers:
Offering childrens clothes, books and toys under one roof, and thus saving oncustomers valuable time.
Offering a wide variety of the above products. Making shopping an enjoyable experience for parents and kids.
2.1.3 Market Trends
Trends in the market are fast changing. One of the important changes is the increasing
preference for branded apparel. This shift is taking place on account of changes such as a rise
in the disposable income of the people and the increasing influence of foreign culture. The
other important change that is taking place in this area is the emergence of kids as an
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independent buyer group. Influenced by mass media and peer pressure, today's kids are more
informed and self-conscious.
2.1.4 Market Growth
Children's apparel includes clothing for kids between 1 and 14 years of age. The market for
kids' apparel in India exceeds Rs.13000 crore, of which around Rs.3000 crore is constituted
by branded kids' wear. The kids' wear market is growing at the rate of 10% per annum, which
makes it one of the fastest growing markets.
According to the Toy Association of India, the Indian toy industry is worth Rs 25 billion by
domestic production but toys worth nearly Rs 70 billion are imported from China. The Indian
toy sector is growing at the rate of 15-20% every year.
Parents today realise that it is important for their children to develop good reading habits.
Thus, they are willing to spend more on books today than they were a few years ago. Hence,
the childrens books market also has a lot of potential.
2.2 SWOT Analysis
The following SWOT analysis captures the key strengths and weaknesses within the purview
of our business and the market.
Strengths
Offering childrens books, toys and clothes under one roof, thus making shoppingeasier and more convenient.
Offering a wide variety of the above products. Offering branded apparel like Ruff Kids, Weekender Kids etc also toy makers like
Funskool will be sold at one place.
Being the one and only shop of this kind in all of Coimbatore city is definitely anedge .
Weaknesses
Our KIDZEEElacks brand equity.
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We have a limited marketing budget to spread awareness about our company.Opportunities
First of its kind in the city. Coimbatore An educational hub of Tamil Nadu.
Threats
People might prefer going to exclusive shops for clothes, toys and not to one shop thatoffers everything.
Emergence of organised retailing like Big Bazaar, Reliance R-Mart in the city.
2.3 Competition
Ours is the only shop of its kind in Coimbatore city, but we still face competition from
exclusive stores for books, toys and clothes like Odyssey, Chennai Silks, Shree Devi textiles
etc. These are already established shops with a strong following of loyal customers. It might
take considerable time to build a strong customer base.
2.4 Keys to Success
Quality Products, at their best value. Outstanding customer service. Making shopping an enjoyable experience for parents and childrens. Making shopping more convenient.
2.5 Critical Issues
The critical issues facing our company are recovering our fixed costs and expanding business,
both at the same time. In order to do this we must adopt a modest fiscal approach and expand
at a reasonable rate keeping the economical feasibility in mind.
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2.6 Macro-Environment
2.6.1 Demographic Environment
The demographic profile of India is a great marketing asset. While, as per 2004 data, people
in the 0-14 years age group constituted 31.7 per cent of the population, the 15-64 years age
group forms 63.5 per cent and the people above 65 years constitute the balance. (URL: http:
//www.hindubusinessline/2006/10/14/stories, 14-10-2006)
2.6.2 Economic Environment
In India, the total number of consuming class with an annual income level between $1,000
and $4,800 around 75 million households in 2006 compared to 29million households a
decade ago. (URL: http: //www.hindubusinessline/2006/10/14/stories, 14-10-2006)
2.6.3 Sociocultural Environment
Nowadays, time is a major constraint for people. They aspire for convenience in all the
services they use.
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3. Marketing Strategy
The key to marketing strategy is focusing on the availability, ease in shopping, and
accessibility to the store.Kidzeee can cover up to 40 % of the market because the products in
the store cover the three main aspects regarding shopping for kids(i.e. dresses, books and
toys.) .Though each of these items cover three different segments in terms of products but
the end users are the same. i.e. children
3.1 Mission
Kidzeees mission is to provide parents a one stop shopping store for their children (primarily
upto the age of 15), providing them with variety of apparels, books and fun products. Weexist to provide ease and comfort of shopping for the customers.
3.2 Marketing objectives
Maintain positive, strong growth each year (irrespective of the store locationconstraints)
To expand upto more than 25 stores in all the metropolitan cities with a steady marketpenetration within the next 10 years
To use backward integration technique reduce overall costs of sales, reduce timebetween ordering and delivering in some of the store product like toys and apparels.
3.3 Financial objectives
Increase the net revenue by more than 10 percent per year through efficiency andeffective implementation of marketing strategy.
To obtain a healthy percentage of market share within the first year of inception.3.4 Target markets
As we are a country where more than 30% of the population is below 15 years. And with a
very few number of stores operating full scale concentrating on exclusive children stores, an
untapped segment comprising of parents with shopping time constraints, who prefer shopping
for children from a single store could be easily identified. Such a market segment could be
tapped using the current market trends and its effects. Our marketing survey reports indicate
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that a majority of parents would like such a store to open up. Kidzeee targets parents with
shopping time constraints. Children surveyed also preferred shopping through a single store
stating ease of selection of products they use and lack of availability of variety of the three
products in a single store. So children could be a part of the target market, (kids who shop
themselves). But the majority target market would be parents who are the major shoppers.
3.5 Positioning
Kidzeee will position itself as a one stop shopping store for all kids basic utilities pertaining
to their fashion, fun and learning. This positioning would be achieved by providing parents
with a wide range of apparel, books and fun filled games and toys. The point of disparity
being clearly variety in availability of children products. The point of parity being established
exclusively for children.
3.6 Strategies
The objective of Kidzeee is to position itself as a one stop shop exclusively for children. The
marketing strategy aims to create customer knowingness about the offered products, their
price ranges, variety of products. These would be achieved primarily through advertisements
in initial stages as majority of Indians go for a product through its advertisements. Print
media would be given a major preference in advertisements as our stores are localized to the
resident city people for which print media is the most accessible. Television advertisements
would be used as complementary method of marketing strategy. Promotion and
advertisement would also be done by co branding the store with a bank and any leisure
providing organization like restaurants, theatres.
The second method would be through the organizations website providing an insight into
stores, product ranges, product varieties and store locations. It would cover all the aspects
included in the primary method of marketing. The cost for advertisements is expected to be
higher since the store is in its initial stages. Gradually the cost of advertisement would
reduce to minimal.
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3.7 Marketing Mix
Kidzeees marketing mix is comprised of the following techniques based on pricing, place
and, advertisement and promotion
a) Pricing
Pricing is based primarily on the buying price with an extra premium of maximum of 15%
above the market price.
b) Place
The store would be placed at a well accessible location inside the corporation limits of the
city, with adequate parking facilities.
c) Advertising and promotion
Several different methods will be used for the advertising effort. This would include
co- branding with banks and leisure providing organizations within the city.
3.8 Marketing research
With the advancement of globalization and increased pace of life, parents find it extremely
difficult to go into different stores for purchasing different products. Since this trend is on the
rise in India, it was eminent that such a store would serve the customers upto their
expectations. The survey conducted confirmed the above statements with majority of parents
favouring in the establishment of such a store. Their suggestions during survey helped in
determining the preferred store location. Time for shopping which was the major constraint
was identified as expressed by the parents.
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Sample size : 85
Area of survey : RS Puram, Gandhipuram and Race Course- Kovai
Date : 6th october, 2007
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4. Financial, Budgets and Forecasts
This section will give the financial overview of the firm related to marketing activities. The
firm will address the Break Even Analysis, Sales Forecasts, and Expense Forecasts and how
these activities linked with marketing strategy.
Budgets
As this is a partnership business all the members of the management team invests an initial
amount of Rs.8 lakhs each and the remaining capital was raised through bank loan. The
Company took a loan of Rs.25 lakhs from Catholic Syrian Bank to be paid back in 5 years
with an interest rate of 17%.
4.1 Break Even Analysis
BREAK EVEN
0
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
30,000,000
1 2 3 4 5 6 7 8 9 10 11 12 13 14
YEARS
Rs. Sales
Expenses
Break even point is the point where the revenue line meets the expense line .Based on the
sales and expense forecasts and also the demand forecasts we expect to break even from sixth
year onwards.
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4.2 Sales Forecasts
From the market survey report we found that there exists a great demand for the three items,
especially branded apparels for kids. Based on the current market trend and economic
situation we expect an increase in our sales by 14% for the first 3 years and 10% for the next
10years.
The data we collected from the various Stores has helped us to predict this increase in sales.
The Data from Funskool (the main supplier of toys) show that they predict a yearly increase
of 12% in Coimbatore Sector. We expect an increase of 5 % in sales every year due to the
competition from established shops like ODYSSEY.
The research conducted by us show that there has been an increase of 12% every year in
other major stores. Correspondingly we predict a 7% increase in sales of books since we are
just starting up our enterprise.
We believe that the latest trends show that the children are more attracted towards trendy and
branded apparels. We are the only providers of the branded items in Coimbatore city. We
expect an increase of 16% in the apparel segment.
Our sales mainly depends on the festive season in Tamil Nadu especially in months ofJanuary (Pongal), April(Tamil New year) and during the months of October and
November(Deepavali).We also expect a decrease in sales during March as the exams are
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conducted during this month.
Expected Monthly Sales
-100000
100000
300000
500000
700000
900000
11000001300000
1500000
1 2 3 4 5 6 7 8 9 10 11 12
Month
Rs.
Series1
4.3 Expense Forecasts
We expect an increase in expense of 3% every year for the first three years, 5% for the next
five years and then an increase of 8% there onwards. Monthly expense include monthly
interest of bank loans, Marketing expenses Salary & Allowances, Electricity and Water
charges, Dress materials, Toys and Books and also we amortise our initial expense with in 5
years permitted by Indian Accounting Standards.The following graph depicts the monthly
expense for the store in a year. Expenses for the month of march are the least in year as the
expected sales for the particular month is lower owing to the on going examination season.
Expected Monthly Expense
0
500,000
1,000,000
1,500,000
2,000,000
1 2 3 4 5 6 7 8 9 10 11 12
Months
Rs.
Series1
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5. Demand Forecast
We are trying to position ourself as a premium outlet offering goods and services st their best
value. This choice ultimately puts a constraint on our target market. Our Target market could
have been roughly estimated as children under the age of 14 who are studying in schools.
But, the premium pricing offered by us would encourage only parents of children who are
affluent enough to buy brands for their kids.
If we had no pricing constraint our target Market would have been much larger it would
have included children studying in all government, private and government aided schools.
But, offering premium prices has reduced our target market to children who are studying in
private schools. This decision of ours is backed by evidences which we obtained in our
market research, which says that parents send their children to private schools expecting
quality, knowledge and healthy habits. The number 362 represents the number of private
schools in coimbatore.
The total number of schools in Coimbatore - 2778 Our Target Schools - 362
Chart 5.1
The table below shows the number of schools in each category in the city of Coimbatore.
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The table below shows the population of school children age wise. The projected increase in
the school going children population is shown below based on Household survey
2005(Provisional)
The final column in the table below illustrates the rate of growth of school going children in
each category. The population growth rate of Tamil Nadu is around 11.19(Source: Census
2001) and the average growth rate of school going population is around 8%. Hence, we
assume that our demand also to grow at a minimum rate of 7%.
Actual Target Schools
Private Schools by category No: of schools
Primary School 329
Middle School 44
High School 150
Higher Secondary School 168
Total No: of target schools 362
Total No: of schools in Coimbatore 2778
Some schools are
included in many
categories, hence the
difference
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As a part of our initial marketing activities and also because of our financial constraints,
initially we would like to target all our marketing activities towards some few schools listed
below. The number of these schools in this list would be revised taking market preference
into consideration. The schools that have been identified are based on the fees that they
charge, the average income of the parents of children in these schools and also a subjective
study of their buying habits. The strength as on date has been given below and a 7% increase
in the school strength has been taken into consideration. We consider these parents to be
wealthy and well informed and who always place quality before price. Therefore every
attempt from our side would be made to make sure that we are recognised and appreciated
and also a preferred choice for their shopping activities.
5.1 Initial Marketing strategies
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6 Contingency planning
Partnership firm always carries along with it a factor called risk. Every attempt will bemade to ensure that differences dont harm our existence. We have entered into a
legal contract which prevents any withdrawal of capital before a period of 10 years
but periodic distribution of profit based on the proportional investment.
Threats from retail giants like Big Bazaar, R-Mart and Wal-Mart is unavoidable. Oursafe stand would be to create loyal customers and that would be done with due care.
Unforeseen events like Fire, Theft are always there for every organisation. We haveinsured our store, our insurance partner is ICICI.
We operate on a rented floor area and so there is always a possibility of we enteringinto a dispute with him. We have entered into an agreement which would allow us tooperate in the same place unless we decide
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7 References
1. Census data- www.genedusat.com2. URL: http: //www.hindubusinessline/2006/10/14/stories, 14-10-2006)3. www.funskoolindia.com4. Marketing Management, Philip Kotler & Kevin Lane Keller,5. Legal aspects Of Business, A. Pathak, third edition, Tata-McGraw Hill.
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Appendix
Questionnaires
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