Marketing Plan for new new product

“Shaking

Pillow”

“Manage your time to a better life”

I. Executive Summary

II. Industry and competitor analysis

2.1 Industry Overview

2.2 Competitor Analysis

……………………………………...…3

III. Company and Product Description

3.1 Company Description

3.2 Opportunity

3.3 Strategy

3.4 Product Description

………………………………………...4

IV. Marketing Plan

4.1 Overview

4.2 Target Market

4.3 Marketing Communication

4.4 Marketing Mix

4.5 Pricing

………………………………………...6

V. Operations

5.1 Location

5.2 Facilities and Equipments

5.3 Insurance

5.4 Employees

5.5 Suppliers

…………………………………….....11

VI. Development Plan

6.1 Development Time Line

6.2 Trademark

6.3 Competitive Advantage

6.4 Growth Plan

……………………………………….14

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6.5 Growth Factor

6.6 Risks in Development

VII. Team

7.1 Management Team

7.2 Advisors

……………………………………….21

VIII. Critical Risks ……………………………………….21

IX. Financial Plan ……………………………………….22

I. Executive Summary

Nowadays, many people have difficulties in managing their time because of

their tight schedules and so on. Therefore we have created an innovation that could

possibly help people to overcome their time managing difficulties. Shaking Pillow is an

innovation that was created to accompany costumer in their daily life. Shaking Pillow is

a pillow with a built in alarm clock. What is unique about this innovation is when the

Shaking Pillow rings, it would also shakes. This innovation is hoped to be helpful for

those who could not be on time to their appointments.

II. Industry and Competitor Analysis

2.1 Industry Overview

The industry in specific can still be seen as quite new, or rather “untouched”.

As alarm clocks are generally used as a tool for waking up, there have been few

innovative or “hybrid” products out in the market that combines both a wake up device

and a pillow in one.

So instead of comparing our product with other similar products that are hard to come

by, making a comparison with the general alarm clocks would be a better choice.

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Sales of alarm clocks, aware by all, are considered to be steady, if not

increasing. Not to mention with the invention of new gadgets that implements the alarm

function as well, it is indeed a difficult market to break into. On the other hand, the

difficulty may also turn out to be our advantage as it shows there are users out there

who are willing to try out new ideas and product innovations.

2.2 Competitor Analysis

Technically, there are no exactly similar products out in the market up until

now but there are several similar products that me be of concern to how well our

products may sell in the market. For example the conventional alarm clock, as

mentioned before, are our main competitor.

There is also a new innovative product called “Snore Pillow” made by France

Bed, which is scheduled to be released for sales in April 2009. Its functions include

having a sensor inside the foam pillow, which will wake the user through vibration

when it detects snoring. The similarity may complicate the sales of our product.

III. Company and Product Description

3.1 Company Description

Our company is company which produces Shaking Pillow. Our company profit

by selling our special pillow direct to the super market like Wall Mart and Cosmos. On

the other words, our company is a pillow manufacturing company. At first we will

target in students in Stamford University and Dhaka city also. If the business goes well,

we will consider expanding our business to the whole Bangladesh.

3.2 Opportunity

Although pillow manufacturing is not a now business, we have our special

characters. A lot of students in Stamford University have getting up problem especially

when they have 1st period. If you get up late, probably you will miss the Class. And if

you live in Jattrabari and Uttra because there heavy traffic jam, you will miss the first

period. People may buy a alarm clock to solve this problem. But on the contrary, alarm

clock does not work well usually. According to the survey, students always ignore the

alarm clock or they will turn it off and continue to sleep. But our Shaking Pillow is

different from traditional (details will be provided in the following sections) alarm

clock.

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Because of the pillow is shaking, you can not ignore it, even you want to turn it off, it is

not that easy. So you just have one option actually, that is getting up. So in this market,

our product is a totally new product. I can say our Shaking Pillow is quite competitive.

3.3 Strategy

Our selling strategy is put our products direct in the super market. If we build

up our own store　to sell our pillow, we need invest more money and much risky. But

putting our pillow in the super market means stable customer and less risk.

3.4 Product Description

Basically, our product is a pillow which is modified in to a wake up alarm

pillow. It consists of three parts, which are the battery part, the machine part and the

pillow itself.

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Cable

Battery

Cable

12:00Alarm

SetVibrate

LockL

R

R

L

The battery is positioned on the right side of the pillow. It is using 2 small

batteries (batteries usually for watch) and connected to the machine part through 2

slender cables. The battery part is kind of small and covered by a hard plastic so the

batteries can not be easily shifted.

The machine is composed of a set of buttons, a digital LCD, a lock key, and a

speaker. The buttons are the “alarm”, the “set”, and the “vibrate” button. They are made

of a plastic (like the buttons of a washing machine) so the buttons can not be easily

pushed, especially when the owner is sleeping and unconsciously touch them. The alarm

button is basically to activate the alarm function, while the set button is to adjust the

clock, and the vibrate button is to activate the “vibrate” function. The LCD is the

normal one, not a touch-screen type. We attach the lock key for the security reason so

the already set preferences can not be changed unless the owner unlocks it. The machine

part is quite sizeable and takes roughly 1/8 of the whole size of the pillow.

The pillow itself is a space where the owner can sleep at ease. It is obvious that

this part is the main component of this so-called shaking pillow.

If we analyze the strength and weakness of the Shaking pillow, we can conclude

that the strength is that the pillow simply looks like the normal pillow but it can give the

consumer more benefit. The consumer will not have to worry that they could not wake

up in the morning anymore since we guarantee it. The weakness of the pillow is about

the price. It costs more expensive than the average price of normal pillows available in

the market.

IV. Marketing Plan

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Front Back

4.1 Overview

Many people might have difficulties in managing time especially when they

cannot get themselves up in the morning. To proof this, we had distributed a short

questionnaire. The result of the short questionnaire will be an indicator to

commercialize and to develop our innovation.

4.2 Target Market (YOUR TARGET MARKET)

To find out our target market, questionnaires had been distributed to

approximately 100 potential customers, mostly students in Stamford University. Below

are purposes of the questionnaire:

To know with the number of people who have difficulties to wake them

selves up in the morning

To know if people are actually using alarm clock or not

To know whether the usage of alarm clock is effective or not

To be familiar with the main reasons of why their current alarm clocks

are not effective enough

4.3 Marketing Communication

All the promotions that are made are executed through the Marketing

department. The marketing department is divided into 5 sections, which are Public

Relations, Online Marketing, Advertising, Direct Marketing and Event Marketing.

According to the financial statement planning for the first year, advertising and

promotion budget given is $3700.

First of all, the announcement of our product will be through the local

newspaper and some local television channels to attract a large quantity of demand. This

is the first move that will be done, when shaking pillow is launched for the first time.

Then, pamphlets, brochures, and billboard will be the next advertising will be

done. A quite big billboard will be installed in front of the main office. The color will be

the same with our company’s logo (will be describe below) and the size will be quite

big XX x XX. Pamphlets and brochures are going to be printed and distributed 10.000

sheets monthly.

Additionally, an official website will be released for the convenience of the

customers to be able to access the site and buy shaking pillow only by clicking from

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their own home. However, this website is the online marketing section’s short term

project, which is currently in progress for initial introduction and is planned to be

completed within 2 years.

4.4 Marketing Mix (4P)

Products

Shaking pillow’s logo will have a hipper and less formal style, using brighter and

marketable colors. The colors will be green (olive) and sky blue. Green describes the

relaxed circumstances of grass dessert and sky blue describes the peaceful. The name

and the logo will be combined altogether and will also define the company colors and

style.

All upcoming products will have a packaging that is in line with the enhanced company

and product positioning. All upcoming packaging should:

Clearly state what they do in their title and tag lines

The product name and key message needs to be located on the upper half of the

package so it can be seen if placed on the shelves in retail stores.

The packaging should have an average of three seconds to attract and sell a

consumer as he passes the shelf.

The size of the product is the same with the normal pillow. The dimensions are XX x

XX inches.

Price

The explanation about the price will be explained on the next point.

Placement (Sales and distribution)

With the introduction of a product aiming at the mainstream category, the

supplier will be an Indonesian company that produces normal pillow with low cost.

Knowing that the raw material cost and labor cost in Indonesia are cheap, it is thought

that it will be better to use the raw materials from Indonesia.

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Going after the regional alarm clock and pillow manufacturing companies’

chains (e.g.: Seiko, Casio, France Bed, etc.) that successfully compete with the national

chains in their respective areas and because of the price point is still on the average, it is

believed that shaking pillow is able to and will get into the low end selling locations

(stores) such as Nondon and Agora.

Promotion

Our promotions are designed to create demand.  The explanation about the

promotion has already been discussed on the previous point (marketing

communication).

4.5 Pricing

The cloth and cotton, alarm, and vibrator will be ordered from other

manufacturing companies at the price $12.8, $5.5 and $11 per item, respectively. Then,

assuming the indirect cost, direct labor, and direct material cost $3.7 per unit, the total

production cost of each item would be $33. Assuming also the profit for each item is

$6, the total will be $39. At this point, shaking pillow will be offered at the price of $39

(much or less 2700 Tk).

According to our research on the local stores in Dhaka, price for a pillow varies

from 2200tk up to 2500 taka Here, it can be seen that our shaking pillow’s price is still

on the range and at this point it is believed that our shaking pillow still can compete on

the market. The price might be a little bit expensive but with extra capabilities and

above-the-average quality standard, for sure the price would not be the same as the

normal one.

V. Operations

5.1 Location

Below are the choices of location to develop our company;

●Dhaka

●Chattagong

●Rajshai

●Sylhet

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We conducted several researches about these items; chattagong is the best

location because there are a lot of transportations (Chattagong station, buses, taxis). It is

very convenient in transportation to work. One more reason, we do not have to pay

much money to rent the land for opening our new company.

5.2 Facilities and Equipment

Facilities

water fee

electric fee

internet fee

telephone fee

gas fee

fax fee

Equipment

copy machine / fax machine

printer

furniture

computer

5.3 Insurance

Employment Insurance

Workers accident compensation insurance

Unemployment insurance

Health insurance

Employees' pension insurance　　

Having been injured while working, the company will use the workers accident

compensation insurance (industrial accident). As for the accident on the commuting

road, the worker is caught in that accident or death. As for the commuting disaster, a

necessary insurance supply is done to the bereaved family with the workers'

compensation insurance. As for the unemployment insurance, (supply like

unemployment etc.) it is provided, and the child-care leave is acquired or the family-

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care leave is acquired, necessary insurance is provided for a constant period to gaining

re-employment if losing one's job. Moreover, Training and Education Benefits System

is provided for many people recently. The workers' compensation insurance is worker's

strong view.

Company Insurance

General liability insurance

It is also called the 'Facilities liability insurance', used for cover the damage

suffers by bearing a juridical liability for damage to others. When the safety of sole

proprietor's facilities is maintained, the injury and the thing are damaged to the others

due to the accident because of the accomplishment of work, the use of the accident,

incompleteness of management and a constructional defect and facilities.

There is 'Constructor's liability' that covers a defect of facilities to do the

contract work such as accidents and the material depositories accomplishing the

contract business and an incomplete accident, etc. for management. Engineer works,

building operations, and the contract business are accomplished.

　 This system is a system to support the unemployed independence to the product

pole when becoming the entrepreneur of the business category of the employing

unemployment insurance as for the employee who employs it the recipient own of the

unemployment insurance establishing, and continuously within one year establishment.

Social insurance（Government pension plan, National health insurance） Entrepreneur comprehensive insurance system

5.4 Employees

● part-time employment, hourly wage: 700～

● permanent employment, Seniority type and Ability type

● welfare / bonus: Salary increases and six months bonus for permanent

employment

5.5 Suppliers

Materials needed:

●cotton

●cloth

●vibrator and alarm

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Operation Cycle

We will order this kind of materials from Vietnam which is cheaper than Japan.

It will help to decrease the cost of production and tend to an important factor in

development plan and competitive advantage.

Operation Cycle

12

Order materials Receive

Materials

MakeProduct

PaySupplier

PaySupplier

14 days

7 days

10 days

7 days7 days

13

CustomerOrder

Received

CustomerOrder

Received

OrderEnteredOrder

Entered

Pick/Ship

Product

Bill to CustomerBill to

Customer

Collect MoneyFrom

Customer

Collect MoneyFrom

Customer

VI. Development Plan

Product: Shaking Pillow

Markets: First, selling to retailers such as convenient store in Dhaka and expanding to

the other prefectures of Bangladesh.

Time: One year of operation

6.1 Development Timeline

As for the development timeline, we spend time about one year to complete our

business plan, and open the company which located in Dhaka. We do not open our own

store because we will sell it though the department store which starts in Sylhet, Rajshai

or Chittagong first then expands the market trends to the other parts of Bangladesh.

Operation development

As for the operation development, if we can expand our products in the Japan’s

markets, we have to develop our time spending in operation as well for improvement in

well-operated process. Moreover, if we can manage less time in operation, it will lead to

the satisfaction of the customers.

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Activities Date Dept.

Product design 2009/02/10 ~16 Design

Pre-Marketing 2008/10/01 ~ 05 Marketing

Business plan finalize 2008/11/15 ~ 26 All staffs

Business plan review 2008/11/01 ~ 31 GM

Register rights to business name 2009/09 ~ 10 Law

Seek funding from appropriate sources 2009/10 ~ 11 Finance

Initial contact with retailers 2009/01 Sales

Create e-commerce site 2009/01 ~ 2008/01 Sales

Confirm funding 2008/12 Finance

Open bank account 2008/01 Finance

Finalize marketing plan 2008/02 Marketing

Recruit and train staffs 2008/02 Human Resource

Distribution of products to Retailers 2008/03 Logistics

Operation development

6.2 Trademark

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Order material

s

CustomerOrder

Received

CustomerOrder

Received

OrderEnteredOrder

Entered

ReceiveMaterial

s

MakeProduct

Pick/Ship

Product

Bill to CustomerBill to

Customer

PaySupplier

PaySupplier

Collect MoneyFrom

Customer

Collect MoneyFrom

Customer

14 days 7days

7 days 5 days

10 days 7 days

7 days 5 days

7 days 5 days

Subject of protection of trademark

The subject of protections of trademark is letters, diagrams, symbols having the

effect of identifying the subject of various products or services. Trademark is a mark

used by a manufacturer, dealer or service provider in respect of goods or services in

order to differentiate them from goods and services offered by other parties which are of

the same or a similar type.

Procedures for obtaining a trademark right in Bangladesh

In order to obtain a trademark right in Bangladesh, one must submit an application

for trademark registration to the Bangladesh Patent Office in the set form prescribed by

the ordinances. A set of prescribed requirements must be fulfilled in order to obtain a

trademark registration. An examiner will check whether an application meets these

requirements. Trademarks which do not enable consumers to differentiate the

applicant's goods or services from those belonging to other parties, and which are not

able to register for reasons of public interest or for the protection of private interests will

be refused as they are deemed not to meet the substantive requirements.

The whole procedure from filing to registration in Bangladesh is shown in the flow

chart below.

6.3 Competitive Advantage

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New design The company’s designer team can release the new designs of pillow products

such as bolster and produce it to be bolster shaking (bolster+ alarm+ vibrator)

Cheap Price

High quality

Good Location

As for the location, the company is located in the countryside of Bangladesh

(Dhaka) which has more competitive advantage in rental fee.

Low – price suppliers

As we import the materials in production from low-cost countries (Vietnam and

Indonesia). It can reduce the production cost comparison to use materials in

Bangladesh

6.4 Growth Plan

Strategy

1. Create a friendly supportive service Establish the costumer service center to answer all the questions (problems) of

the product (for 24 hours)

Train employees to always be helpful and make the customer’s satisfaction the

main motivating factor

2. Working environment Encourage employees to work hard and efficiently

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Make them feel comfortable and consider the company as their family

Achievers are rewarded

3. Fulfillment of quality and reliability Promise to produce high-quality products all the time

4. Guarantees Fix all the problems of our products within 1 year for free

After 1 year, we can provide the same service at a low price

5. Improvements Always keep improving the qualities and skills of our employees are the order

of the day in our regular training sessions and meetings.

Keeping a close watch on technological change will allow us to stay state-of-

the-art with our products.

6. Promotions

Order from online website, sale 10%.

Order from online website at the end of the season, free logistic cost and sale

10 -50%

6.5 Growth Factors

1. Profit If the company gains much profit, it can be the capital for developing products.

2. Advertisement

Advertisement is an important key to present the customers about our products.

3. Service Good services can response to the satisfaction of customers.

4. Design New trend design can be a competitive advantage.

6.6 Risks in Development

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1. Employment problems

The employment problems are one of the most significant problems that happen in

the world of business today. This problem can happen due to the lack of discipline in

work especially, the part-time job workers, they can work only for a short time, often

absent as well.

2. Pillow and Alarm clock Company

The pillow and alarm clock company is an important competitor. If they produce

such high innovative technology, our shaking pillow company absolutely gets a hard

time and high risk in this kind of business.

3. Small Market Scale

Pillow and alarm clock are the products which can use for a long time. The

customers do not buy the products everyday like a food business. It shows that the

market scale seems so small. This kind of products cannot be sold in only one location,

but it has to expand by selling in the large market in the big city of Bangladesh, and

spread to foreign countries as well.

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VII. Team

7.1 Management Team

The lead entrepreneur and one of the members of the CEO in our company

would be XXX as she came out with the product idea. She will supervise the research

and development of our product and make sure it is compatible with our company

ideals.

XXX and XXX will also be appointed as CEO to help in further company

management. Having had experience in several business related fields before, it is

expected that their promotion will help in a better team management experience.

7.2 Advisors

XXX will be promoted to help XXX to as Product Development Advisor and

help in product research development. XXX has had experience in technical related

fields, so this skill will be of use when it comes to technical problems faced.

The head of our Finance Department, Marketing Department, and Distributing

Department would be XXX, XXX, and XXX respectively. As each member has had

previous experience with handling the specified fields, smooth management with a

relatively low amount of setbacks in management are expected.

VIII. Critical Risks

1. Research and Development

As our product is considered as a relatively new idea, a somewhat large amount of

investment would be needed to perfect the way our product works. Deciding on which

companies to collaborate with as our outsourcing supply may be a risk as well.

Collaborating with well known alarm clock and massage machine suppliers may help us

boost our image but on the other hand, they may also charge a heftier amount of

supplying the needed components as well.

2. Funding

Starting out on a business is never easy as a significant amount start-up fund would be

needed. Our initial amount of fund needed estimates up to XXX and convincing

collaborators to invest in our product may also be a problem initially.

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3. Public Acceptance

A survey done in Stamford University reveals that most students would be interested in

our product. However, getting them to truly accept and buy our product may prove

otherwise. Launching a new product in markets requires extensive research and

development, marketing strategies and proof that the product works and is truly useful.

This again, adds to our funding problem.

4. Threats from Competitors

Our product’s biggest threat would be none other than the traditional and well known

alarm clock. It has been widely accepted and used as a conventional tool to help people

wake up in the morning. Although our product is a new innovative invention that ideally

should work better than an alarm clock, getting buyers to change from the regular alarm

clock to our product may not be an easy task.

“Snore Pillow” from France Bed, may also end up being one of our

competitors due to its similarity with our product. Although not as big a threat

compared to the conventional alarm clock, it may still end up a hindrance in sales of our

product.

Another threat would be a company that is alleged to be producing a device

that enables user to wake up to their favorite drink in the morning. Although technically

our products work in separate ways, the basic idea is still the same – helping people to

wake up in the morning. This may again prove to be another threat to our new product

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IX. Financial plan

Sales forecast:

Revenues are calculated separately for our product and for maintenance. The product

included in this forecast is shaking pillow.

Chart-1, Sales budget:

Year 2008 2009 2010 2011 2012

Sales budget

($)

30,000 35,000 42,000 50,000 60,000

The prospected sales budget of or product is 30,000$-60,000$ items respectively from

2008-2012 within these five years.

Chart-2, Direct expense budget:Sales

(Amount in

US $)

2008 2009 2010 2011 2012

Cloth and

cotton

7000 7500 9000 11000 12800

Alarm 3000 3400 4600 5500 6500

Vibrator 6000 6600 8400 10000 11500

Others 2000 2500 3000 3500 4200

Total expense 18,000 20,000 25,000 30,000 35,000

We have ordered for the cloth and cotton, alarm and vibrator at the price

Respectively 12.8$, 5.5$ and11$ per item. Assumed expense for manufacturing would

be overhead (known as indirect cost), direct labor and direct material 3.7$ per unit. So

the total production cost of each item would be 33$. For example for the total expense

of year 2008 has been mentioned above.

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Chart-3, marketing expense budget:

(Amount in

US$)

2008 2009 2010 2011 2012

Advertising and

promotion

3,000 3,700 4,500 5,500 6,600

Others 700 800 1,000 1,100 1,400

Total sales and

marketing

expense

3,700 4,500 5,500 6,600 8,000

% Of sales 12.33% 12.86% 13.1% 13.2% 13.33%

Chart-4, Total fixed cost budget:

(Amount in US

$)

2008 2009 2010 2011 2012

Marketing cost 3,700 4,500 5,500 6,600 8,000

Administration

cost

2,300 2,500 2,500 2,800 3,000

Maintenance and

depreciation

1,000 1,000 1,000 1,100 1,500

Total 7,000 8,000 9,000 10,500 11,500

Chart-5, Income statement

2008 2009 2010 2011 2012

Sales 30,000 35,000 42,000 50,000 60,000

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Direct cost of

Sales

18,000 20,000 25,000 30,000 35,000

Contribution

margin

12,000 15,000 17,000 20,000 25,000

Fixed cost 7,000 8,000 9,000 10,500 11,500

Operating profit 5,000 7,000 8,000 9,500 13,500

Sales turnover 16.67% 20% 19.1% 19% 22.5%

Chart-5 is the summery of income statement that give us a vivid view of trend of

the net profit. We can see that for the first four years (2008-2011) net profit has been

increased smoothly. The reason behind that in the manufacturing company it is very

difficult for earning profit at the very beginning. On the other hand we can see that from

the 5th (2012) year net profit has increased bit steeper than last four years. The reason

behind that is the opening new branches and will be becoming well known among the

people.

Revenue VS Expense

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30,00035,000

42,000

50,000

60,000

25,00028,000

34,000

40,50046,500

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

2008 2009 2010 2011 2012Revenue

Expense

As we are prospecting to have the revenue crossing over the total expense, so each and

every year we might have some profit to reach our break even point gradually. From the

above chart we can observe that, we are surpassing the total expense with our revenue in

a very smooth way. From the above graph we can see that the net profit of the year

2008-2012 will be changed respectively 5,000$, 7,000$, 8,000$, 9,500$ and 13,500$

per year

Break Even Analysis:

Chart-6, Break Even sales:

2008 2009 2010 2011 2012

Fixed cost ($) 7,000 8,000 9,000 10,500 11,500

Contribution

margin (average)

40% 42% 40% 40% 41.67%

Break even sales

($)

17,500 19,000 22,500 26,250 27,598

Cost Total Revenue

Total Cost

17,500 E

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7000 Fixed Cost

17,500

BES Sales

According to the investment per year the break even point would have to be

changed accordingly. From the above chart it is clear that we would have reached the

break even point while we will have 17,500$ expense in the year of 2008. So as it will

be 19000, 22500, 26,250, 27,598$ respectively in the year of 2009-2012.

Explanation of balance sheet:Assets Liabilities and Owners equity

Cash and Bank 3000

Inventory 4000

Account Receivable 2000

Rent Premium 5000

Machinery 50000

Furniture 10000

Permits and license 3000

Insurance 3000

Bank loan 20000

(A/P) Friends and Family 20000

O.E 40000

Total asset 80000 Total 80000

As a manufacturing business, we think that inventory control is very important. From

the table we can see that there are inventories of 4000$ for the inventories of opening

date. The price of machineries is mentionable in respect of their cost (50000$).Because

we have to buy all new machineries for the production. And the rent premium is only

5000$, because we wont buy the land instead of it we will borrow the land from the

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local property owner. The largest portion of our investment (40,000$) will come from

the owners themselves.

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