Entrepreneurship

COMFORT STREEK
“A WORLD LIKE NO OTHER”

Business Plan

Presented to:
Prof. Rizwan Saleem

Presented by:
Sajeel Abbas l1f06mbam2041
Usman Ghani l1s07mbam2137
Umair Abdullah l1s07mbam0188
Ahmad Malik l1s07mbam2136

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COMFORT STREEK
“A WORLD LIKE NO OTHER”

A STRESS RELIEFE CENTRE

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 Table of Contents

Executive summery 04
Vision
05
Mission Statement
05
Management & Organizational structure
06
• Marketing department 07
• Finance department 07
• Administration Department 08
• Procurement Department 08
• H.R.M. Department 09
SWOT Analysis
09
Objectives
10
Market segmentation & Target market 13
Market positioning 15
Marketing mix 17
• Product & services 17
• Pricing strategy 22
• Place 23
• Promotion 24
Financial plan 30

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Executive Summary:
The project is about a new business venture. It covers the core concepts that are
involved in the development and implementation of this new company. Taking the
initiative and pulling it towards something unique and different, a new company concept
has emerged that is Stress Relief Centre.

This project guides about the company attributes, boosting its early phases to
penetrate through target market identification and segmenting it to different locations,
planning for market positioning, effective pricing strategy, how to promote it to clients
through different mediums and sources and most importantly, the environmental factors
that are associated with the early stages of company development and post variable
factors that are major challenges to the company.

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Our Vision
To make COMFORT STREEK a caring company, recognizable for uniqueness
Nationwide.

Mission Statement:
Your fitness is our goal. We provide a safe, secure, non-intimidating
fitness environment where customers can achieve their fitness goals.
The professional staff is committed to the highest level of
professionalism that ensures the attainment of customers’ fitness
with motivation and quality.
No more plump bellies now.

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MARKET RESEARCH:

We are going to launch new company in Lahore, Pakistan which is Health Company. In
Pakistan, there are already few companies providing such services like SHAPES AND
SUKH – CHAN so, there is possibility of new company to come, and establish and get
favorable response. It is concluded after deep research that people are getting health
conscious day by day and they want such a place where they can fulfill there health
needs under one roof. So after introducing new company we will be able to provide
unique services to our target customers and so we are providing all services under roof so
we will get a handsome market share in health industry.

Customer Loyalty:

Customer loyalty situation is also unpredictable for us because we will be new in market
and we don’t have any previous business background but we are planning to attract more
and more target customers through different markets campaigns.

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 MANAGEMNT AND ORGANIZATIONAL
CHART

MANAGING
DIRECTOR

ADMINISTRATIVE
MANAGER

SECURITY
OFFICER

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 HUMAN PURCHASE&
MARKETING FINANCE
RESOURCE MAINTANCE
MANAGER MANAGER MANAGER
MANAGER

CLUB
SECRETARTY
MARKETING
EXECUTIVE

PURCHASE
ACCOUNTANT
HR OFFICER
EXECUTIVE

FINANCE
SALES OFFICER MAINTANA
EXECUTIVE NCE
GENERAL OFFICER
STAFF

MANAGEMNET STRUCTURE:
MD will play key roll in management control system by utilizing his core competencies,
core values and will apply himself for multitasking like
He will strictly observe the organization organ gram by taking report leading head of the
following departments
1. Management department
2. Finance department
3. HR department
4. Accounts department
5. Security department

Management department:

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 As Stress relief center mission and vision statement it should be his first priority that
management department will translate vision into mission to achieve targets and goals.
MD should receive the progress of organization that
• Organization is providing the basic facility for general customers or not.
• People are acknowledging organization benefits or not.
• Management authority’s goals and target are clear or not.
• Management authorities are working for research and development or not. So in
the other words management department is back bone of the organization which
start from top to first line manager therefore MD will control the structure of
organization through management department.

Finance department:
Finance department is one of the most important departments where the MD can collect
the following reports for timely decisions like
Budgeting
Cash flow
Profit and loss statement
Expense sheet
Project plan sheet
Financial analysis
Balance sheet etc.
The report will be submitted to MD to finance manager to control financial crisis

HR department:
It is usually says that if the staff and worker are satisfied and happy with their
organization environment than no force can hurdle to get achievements but it only occurs
if the people have some connections with top line managers, therefore MD can get an
interface through HR department. HR department will take step by step approach like
through
• Appraisal letters
• Evaluation reports

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 • 360° feedback report and with other reports MD will get his target and goals by
teamwork.

Accounts department:
Account officers usually update accounts on daily basis and supply daily finance
statements to MD. He will hold data by the help of daily book keeping of account
department.

Security department:
Security department is usually control by the administration and under HR department
MD plays no role in this department.
It is the position who proves its leading and ruling an object for core values and
competencies.

Rules & Regulations:

These necessary rules and regulations have been created to provide all members and their
guests with a comfortable, safe and enjoyable experience on every visit. The contents also
form part of your membership agreement with us.
We may make reasonable changes to these rules at any time by displaying changes on a
club notice board.

HOW TO BECOME A MEMBER?

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 COMFORT STREEK offers two types of lifetime membership: Founder Membership and
Regular Membership. Founder Membership refers to members who join COMFORT
STREEK before the actual club opening, and is temporary. Hence, the membership fee is
reduced for the Founder Members’ benefit. Regular membership starts once the club is
open. See below for the Founder & Regular Member rates

Lifetime Membership:

Founder
Rs 200,000/-
(covers spouse and children)

Regular
Rs 400,000/-
(covers spouse and children)

Monthly subscription:

Only Lifetime Members will pay a subscription fee for a package that will include the
free use of gymnasium, the swimming pool and other listed facilities.

Member Spouse Children (8-21) Sons aged 21 to 25

Rs.2000 Rs.2000 Rs.1000 Rs.1500

Temporary Membership:

You can become a short-term member at the Comfort Streek Wellness Club by selecting
one of the following Temporary Membership Packages. Temporary Memberships are
offered of one month and a maximum duration of one year.

Subscription Fee is not applicable on temporary members.

Membership Type Price for Principal Price for Member’s Spouse and Price for children

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 Member children above the age of 21 Under the age of 21
1- YEAR RS.75, 000 40,000 20,000
6- MONTHS RS.50, 000 25,000 10,000
3- MONTHS RS.30, 000 17,000 8,000
1- MONTH RS.12, 000 7,000 3,500

Membership:
1. Membership cards are issued to all members, except infants, and must be
presented to the club on each visit. Lost cards will be replaced at a cost.
2. Membership is transferable subject to prior approval by the club management and
at the payment of 25% of the prevalent membership fee .A member can only
transfer his /her membership after retaining the membership for the period of 1
year. The membership fee is not refundable.
3. Corporate Membership of a corporate member will be transferred free of cost to
another corporate member on written request by the corporate head.
4. Supplementary members are dependent on the principle membership holders.
5. Any member who fails to abide with the rules & regulations of the club shall
result in termination of the membership along with all privileges.

GUESTS:
1. Only members aged over 18 may introduce guests to the club, subject to the
payment of the relevant charge.
2. Members must always accompany their guests in the club and are responsible
for their conduct.
3. The club reserves the right to refuse entry to any person as a guest, at it's sole
discretion.

JUNIOR MEMBERS:
1. Children aged fewer than 16 must be supervised by an adult member at all
times. This includes all recreational facilities available to members

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DRESS CODE:

2. Members and guests must wear a form of dress as deemed appropriate by

the club management to the time of day and place on all occasions.
3. Appropriate swimwear must be worn.

COACHING, PERSONAL TRAINING AND PERSONAL STAFF:

1. All coaching and personal training is controlled by the club. No other coaching or
personal training is permitted without the prior written consent from the General
Manager
2. Personal staff will not be allowed as guests or as part of family member's in club
facilities.

NOTICE BOARD:

Specifying rules & regulations are to be considered as part of these Rules &
Regulations. All signage in and around the club area

YOUR GENERAL SAFETY & HEALTH:

1. The Club may, at any time, withdraw all or part of a facility for any period or
periods and with or without notice in connection with any cleaning, repair,

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 alteration or maintenance work or for any reasons beyond their control.

2. Members and guests are advised not to undertake strenuous physical activities if
they have reservations as to their physical condition without seeking medical
advice in advance. All members must undergo an initial assessment and a basic
supervised induction befor
3. e using the Fitness Studio equipment
4. Only sealed plastic drinking containers are permitted in any training area.
5. For hygiene reasons please shower before entering the pool.

6. No outside food & beverages are permitted in any area of the club except bottle
water.

7. No pets are permitted in the club buildings with the exception of registered guide
dogs.
8. The main entrance to the club must be used when entering or leaving. Alarmed
fire exits, which are clearly marked, are there in the interest of safety and must
only, be used in an emergency.

9. All vehicles parked inside or outside the premises are at owner's own risk.

10. Smoking is not permitted in any part of the Club.

11. The management will not accept liability for the personal property of members or
their guests.

12. The management cannot accept any liability for injury to any member or guest
that may occur on the premises or within the grounds of the Club.

13. Any member who suffers an accident on the Club grounds must report it to the
General Manager immediately.

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 14. Any person using club facilities with cold, open wounds, bandages or any
infection will not be permitted to use club facilities.

SWOT ANALYSIS

STRENGHT
• Friendly environment
• Professionally qualified trainers
• Diversified and flexible training programs
• Co facility for specific timings for couples only

WEAKNESSES
• Less space for future project
• Lack of Experience
• Comparatively equivalent pricing

OPPORTUNITIES
• Attractive Future Projects
• International collaboration
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 • Diet counseling and Diet Cafe

THREATS
• Established Competitor (Shapes)
• Higher then expected Costs
• Contingencies
• Legal and Security Issues

Objectives
1. Making healthy environment.
2. Providing best services with latest tools and techniques.
3. Providing helpline for customer care and 24hour service.
4. Limited rates with extra ordinary services
5. Available for almost all categories of age.
6. Providing services to companies in form of memberships.

Product Life Cycle

Industry

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Sales and
Profits ($)

Sales

Profits

Time
Product
Introduction Growth Maturity Decline
Develop­
ment
Losses/
Investments ($)

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Bus Our business

Sales and
Profits ($)

Sales

Profits

Time
Product Introduction Growth Maturity Decline
Develop­
ment
Losses/
Investments ($)

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Market Segmentation and Target Marketing:
Marketing segmentation is done on the basis of Geographical region,
Demographic factors, and Psychographic and Behavioral factors. Than from these
segments target market is identified.

Target Market Identification:

The target market is identified has following geographical, demographic,
psychographic and behavioral attributes.

Geographical region:
Our target market geographical region profile is as follows.

o City:
o Lahore

o Areas:
o Defense

We plan to open our branches in the following areas in the future.

o Gulberg
o Model Town

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Demographic factors:
• Age:
o 12-45
o 45 and above

• Gender:
o Male/Female
• Income group
o Upper class
o Upper middle class

• Occupation:
o Student
o Doctors
o Engineers
o Computer Eng
o Business Man
o Accountants

Psychographic:

• Values and Life Style:

o Achievers
o Party goers
o Health conscious

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 o Stylish
o Sporty

Behavioral factors:
• Occasion:
o Regular occasion
• Benefits:
o Quality
o Uniqueness
o Technical

Market Positioning

Positioning for competitive advantage:

Beyond deciding which segments of the market it will target, the company must decide
what positions it wants to occupy in those segments. A products position is the way the product is
defined by the consumers on important attributes, the place the product occupies in consumers
minds relative to its competitors.
The positioning task consists of three steps:-

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Identifying possible competitive advantages.
As the Company is new in the market, with different features and attributes, so the
management have identified that competitive advantage are its unique services, and good
team etc.

Choosing the right competitive advantage.

Further analysis leads to the conclusion that what people actually need is quality
and long life of the product and also the enthusiastic customers demand for new ideas or
change or the latest technology. So we have chosen quality and perfect innovation as our
right competitive advantage.

Selecting an overall positing strategy:-

Now we need to position our company in the minds of customer. We will offer
the proposition More for Less. As our services are very good in quality and we are not
setting any expensive price for it. We will attract huge amount of clients.

POSITIONING STATEMENT Of COMFORT STREEK

• To people, enthusiasts and conscious about there health, With only

COMFORT STREEK you can stay alert and stress less for the rest of your
life.
” A WORLD LIKE NO OTHERS”

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 MARKETING MIX:

Actually marketing mix consists on all those items which an organization performs to
create and increase the demand of its product consists on all those items which an
organization performs to create and increase the demand of its product.

Following are the 7 marketing mix of our product:

1. Product
2. Physical Evidence
3. Price
4. Placement
5. Promotion
6. process
7. People

PRODUCTS & SERVISES

GYM WORKOUT BODYBUILDING:

COMBINED GYM.

Our ultra-modern fitness center provides the very latest and advanced Nautilus
machinery, to guarantee a safe, comfortable, and effective exercise experience

A personal training program is offered along with a full range of cardiovascular and
resistance equipment, free weights and floor exercises, with a guarantee from our
certified staff.

State of the art Gym sized 100x38 ft with total of 90 plus machines. Includes

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 1-Light weight area
wooden cherry and oak flooring interior equipped with Biomechanical Machines of
Nautilus.

2-Heavy Weight area

Vinyl Flooring equipped with Nautilus’s Heavy Machines for professionals

LADIES:
Only to cater ladies, 42x33 ft sized exclusive state of the art Gym.
1-Light weight area
Equipped with Biomechanical Machines of Nautilus.

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 2-Heavy Weight area (specifically for women)
Equipped with Nautilus’s Heavy Machines for professionals

WELLNESS:

The condition of good physical and mental health, especially when maintained by proper
diet & exercise.

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Wellness is a life-long pursuit of a healthy, balanced Lifestyle. Comfort streek believes
that many factors contribute to overall wellness: regular physical activity, food choices,
balancing career, family, relationships and a positive emotional state of mind.

It is a continuous process of learning how the mind, body, spirit, family, career and faith
are all interrelated to create our lifestyle.

Comfort streek is dedicated to providing you with the very best in Wellness programming
so you can become confident in the lifestyle choices you make. You will find the
knowledge, passion and assistance you need in each and every member of our staff.

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 SWIM SCHOOL:

Private classes are available at any level for adults as well as

children. Children must be at least 8 years old to participate in private lessons. Class
time is dependant upon availability of instructors/students and availability of pool.

Our pool is an amoeba shaped tropical pool with sun beds, a mini island, rockeries,
waterfall, and fountains surrounded with an artificial forest.

Sized L – 70 ft, W – 42 ft
Temperature controlled water with standard filtering system

MASSAGE SPIRIT:

Now you can enjoy the benefits of a MASSAGE any time your mind, body, and spirit
demand to be nurtured.

Our dedicated staff is eager to graciously pamper you from the moment you arrive,
stressed and strained, until you depart, refreshed and rejuvenated. Be assured you are in
the hands of someone who is dedicated to their profession, has extensively studied the
technique and will cater to your every need, making sure that you are completely satisfied
with the results.

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Pricing strategy:-

The pricing strategy portion of the marketing plan involves determining how we will
price our product or service; the price we charge has to be competitive but still allow us to
make a reasonable profit.

The keyword here is "reasonable"; we can charge any price we want to, but for every
product or service there's a limit to how much the client is willing to pay. Our pricing strategy
needs to take this consumer threshold into account.

The most common question small business people have about the pricing strategy
section of the marketing plan is, "How do we know what price to charge?" Basically we set our
pricing through a process of calculating our costs, estimating the benefits to clients, and
comparing our products, services, and prices to other substitutes.

We set our prices by examining how much it costs us to produce the product or service
and adding a fair price for the benefits that the client will enjoy. We may find it useful to
conduct a Break even Analysis. In break even analysis the price is set to break even on the
costs of making and marketing a product or in other words setting a price to make a target
profit.

Place:-
We have bought a land in phase 6 DHA Lahore which is an ideal location for our business. The
place and the surrounding and the atmosphere provided in our club is perfect for our customers
as it will be away from the noisy and busy area of the city. The total area is 6 kanal on which
pool, gym, cafe, parking and admin office is constructed.

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Promotion:
The promotion tools are
• Advertising
• Public relations

The tools on which we have focused in launching our company are advertising and
public relations.

Advertising:-
Any paid forms of non personal presentation and promotion of ideas, goods, or
services by an identified sponsor is called advertising. To develop advertising program we first
have to see what advertising objectives are.

Advertising objectives:-
Advertising objectives can be defined as a specific communication task to be
accomplished with a specific target audience during a specific period of time. There are three
primary purposes of advertising:
• To inform
• To persuade
• To remind
As we are launching our company so we will be using the informing advertising. Our
objective is to build more demand.

Advertising strategy:

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 As we have decided which kind of advertising strategy we are using, next we have to
see what strategy we are going to use. Advertising strategy consists of two major elements:
• Advertising messages
• Advertising media

Creating the advertising message:-

Advertising can succeed only if commercials gain attention and communicate well.
Good advertising massages are especially important in today’s costly and cultured advertising
environment. Just to gain and hold attention, today’s advertising massage must have these
specifications:
• They should be better planned
• They should be more imaginative
• They should be more entertaining
• They should be more rewarding

In our launch of STRESS RELIEFE CENTRE we have considered all these

important aspects of advertising message. Then to make our advertising messages more
appealing we have used message strategy, which basically identifies client’s benefits. Our
appealing advertisement has three characteristics.

Choosing among major media types:-

After deciding reach, frequency and impact we then have to select media through
which we will expose our company. The media we have selected to expose our product
contains radio, magazines, newspapers, billboards.

RADIO:

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 The reason for choosing radio is because of its large mass appeal and secondly it is less costly
compared to television advertisement. Initially we are focusing on radio but at later stage may
opt television media.

Newspaper and magazine

Next we have chosen newspaper as a medium for the launch of our product. It
provides good local market coverage; broad acceptability as all classes can easily buy
newspaper; it also has high believability, as it is a good source of all important news.

Billboards:
We have chosen billboards to be another major source of advertising COMFORT
STREEK in the areas like Defence, Model Town, and Gulberg.

Public relations:-
Another major mass promotion tool is public relations, which is building good relations
with the company’s various publics by obtaining favorable publicity, building up a good
corporate image and handling or heading of unfavorable rumors, stories and events. Public
relation departments may perform any of the following functions.

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Press relations:-
Creating and placing news worthy information in the news media to attract attention to
a person, product or service is called press relations.

Public affairs:-
Building and maintaining national or local community relations is called public affairs.
Public relations are used to promote products, people, places, ideas, activities, organizations or
even nations. Public relations can have a strong impact on public awareness on a much lower
cost than advertising can. The company does not pay for the space or time in the media; rather
it pays for staff to develop and circulate information and to manage events.

Major public relation tools:-

In order to launch COMFORT STREEK we will use several tools.
They are as under:-
One of the major tools is News. By giving attractive and eye catching advertisements in the
newspaper, we will increase popularity and make an image of ourselves in the minds of the
customers.

We will show our SERVICES ads on television channels like GEO, AAJ, and HUM TV
We will try to air these ads at the time on which are targeted market must be watching. These
ads will be made as attractive and colorful as possible in order to attract teenagers and
professionals.

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 MEDIA CAMPAIGN BUDGET:

Our initial advertisement budget is as follows.

TELEVISION:
We are using Initial Cost
three TV Initial Budget 84,10,000
channels for TV CHANNELS 6,027,670
MEDIABILLBOARDS
PLAN OF COMFORT STREEK for 10 days 520,000
Television TVC T0TAL 1st 2nd 3rd 4th 5th 6th 7th 8t 1 /min
Channel Time Band NEWS
Length PAPERS 1,861,325 h 9th 0th Rate Total Cost
Spots Fri Sat Sun Mon Tue Wed Thu Fri Sat Sun

07:00 PM to 07:30
HUM TV PM 60 sec 10 1 1 1 1 1 1 1 1 1 1 70,000 700000
07:30 PM to 09:30
PM 60 sec 10 1 1 1 1 1 1 1 1 1 1 70,000 700000
09.30 PM to 10.30
PM 60 sec 10 1 1 1 1 1 1 1 1 1 1 45,000 450000
Total HUM TV
Amount Total Spots 30 3 3 3 3 3 3 3 3 3 3 185,000 1850000

05:00 PM to 06.59
AAJ TV PM 60 sec 10 1 1 1 1 1 1 1 1 1 1 10,360 103600
08.00 PM to 09:30
PM 60 sec 10 1 1 1 1 1 1 1 1 1 1 16,835 168350
10:00 PM to 10:59
PM 60 sec 10 1 1 1 1 1 1 1 1 1 1 12,950 129500
Total AAJ TV
Amount Total Spots 30 3 3 3 3 3 3 3 3 3 3 40,145 401450

05:00 PM to 06.59
Geo TV PM 60 sec 18 2 2 2 1 1 2 2 2 2 2 13,598 244,755
07.00 PM to 09:59
PM 60 sec 36 4 4 4 2 2 4 4 4 4 4 80,290 2890440
10.00 PM to 10.59
PM 60 sec 18 2 2 2 1 1 2 2 2 2 2 35,613 641,025
Total Geo TV
Amount Total Spots 72 8 8 8 4 4 8 8 8 8 8 129500 3776220

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Total Total Spots 132 14 14 14 10 10 14 14 14 14 14 354645 6027670

COMFORT STREEK ads .our TV ads is for 10 days in initial stages and it can be
rescheduled with the passage of time depending upon the response of target customers.

BILLBOARDS:
We are using 2 types of billboards in Lahore. A and B class. We are using 1 A class
billboard and 2 B class billboard. It covers the areas of Defense, Gullberg and Model
town.

Billboards
Total
City Location Size Area Cost

400,00
Lahore A Class 60x20 Defense 0

Model 60,00
Lahore B Class 20x10 Town 0

60,00
Lahore B Class 20x10 Gull berg 0

520,00
0

NEWS PAPERS:
We are using 2 news papers, DAILY JUNG and DAWN. Initially we are giving our ads
on Sundays. They can be further rescheduled according to the need of time.

Publication Frequency Station Size Position Color cost

Dawn Sunday K/L/R 27 x 4 Front 4- 669,06

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 Page Color 0
Front 4- 1,192,26
Daily Jang Sunday K/L/R 27 x 4 Page Color 5

Total 1,861,325

Action Plan:

Starts from End at Channel of advertising

June1 June10 TV-Hum
June10 June20 TV-AJJ
June1 June10 TV-Geo
May1 June1 Bill Boards
On Sundays News Papers

This media campaign will be monitored under the supervision of marketing department
and marketing department will directly report to the MD.

Financial Plan

• Consulting revenue will make up approximately 85 to 90 percent of total revenue with the
rest coming from service revenue.
• Salaries and rent are the two major expenses while depreciation is another significant cost
that will increase as the company develops. Although the purchasing of fitness medical and
office equipment is expensive constant replacement will be needed to minimize
depreciation costs and maintain a competitive edge.
• In order to maintain steady gross margins salaries and advertising expenses are not likely
to increase within the first two years of operation unless cash flows significantly increase.

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Key Financial Indicators

The most important financial indicators are net increase in cash and net income. Net increase
from cash will exemplify the relationship between net income and net cash from operating
activities. The greater the increase is Corporate Fitness has that level of financial strength at that
point in time.

Break-even Analysis

Corporate Fitness' break-even point is computed in the table below comparing sales and monthly
expenses. Sales forecasts indicate that units sold and monthly sales are expected to be much
greater than the break-even point mentioned in the table.

Break-even Analysis
Break-even Analysis

Monthly Revenue Break-even Rs.279,300

Assumptions:
Average Percent Variable Cost 6%
Estimated Monthly Fixed Cost Rs.269,250

Projected Profit and Loss

Sales are predicted to increase each month with first year annual sales totaling close to a half-
million dollars. Gross margin likewise is expected to increase correspondingly.

Compared to total sales net profit will increase each month and is predicted to increase for 2008
through 2010.

Profit and Loss

Pro Forma Profit and Loss
2008 2009 2010

Sales Rs.5397,500 Rs.6507,500 Rs.8256,000

Direct Cost of Sales Rs.330,000 Rs440,000 Rs.550,000
Other Rs.0 Rs.0 Rs.0
------------ ------------ ------------
Total Cost of Sales Rs.330,000 Rs.440,000 Rs.550,000

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Gross Margin Rs.5060,750 Rs.6067,500 Rs.7706,000
Gross Margin % 93.88% 93.24% 93.34%

Expenses
Payroll 1500,000 1500,000 1500,000
Sales and Marketing
Rs.252,000 Rs.252,000 Rs.252,000
and Other Expenses
Depreciation Rs.72,000 Rs.72,000 Rs.72,000
Insurance Rs.54,000 Rs.54,000 Rs.54,000
Rent Rs.600,000 Rs.600,000 Rs.600,000
Other Rs.0 Rs.0 Rs.0
Utilities Rs.252,000 Rs.252,000 Rs.252,000
Leased Equipment Rs.276,000 Rs.276,000 Rs.276,000
Payroll Taxes Rs.225,000 Rs.225,000 Rs.225,000
Other Rs.0 Rs.0 Rs.0
------------ ------------ ------------
Total Operating
Rs.3231,000 Rs.3231,000 Rs.3231,000
Expenses

Profit Before Interest

Rs.1829,750 Rs.2836,500 Rs.4475,000
and Taxes
EBITDA Rs.1901,750 Rs.2908,500 Rs.4547,000
Interest Expense Rs.109,260 Rs.125,310 Rs.141,740
Taxes Incurred Rs.424,240 Rs.677,800 Rs.1101,370

Net Profit Rs.1296,250 Rs.2033,390 Rs.3231,890

Net Profit/Sales 24.05% 31.25% 39.15%

Profit Monthly

Projected Cash Flow

With cash flow increasing significantly and expenses remaining relatively static with only minimal
increases cash flow will experience a similar increase for each period of financial evaluation.

Cash flow is expected to more than double in 2008 and increase substantially in 2009 with
corresponding positive cash balances.

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Cash Flow
Pro Forma Cash Flow
2008 2009 2010
Cash Received

Cash from Operations

Cash Sales Rs.2156,300 Rs.2603,000 Rs.3302,400
Cash from
Rs.2303,950 Rs.3711,740 Rs.4651,790
Receivables
Subtotal Cash from
Rs.4460,250 Rs.6314,740 Rs.7954,190
Operations

Additional Cash
Received
Sales Tax VAT
Rs.0 Rs.0 Rs.0
HST/GST Received
New Current
Rs.270,000 Rs.247,500 Rs.247,500
Borrowing
New Other Liabilities
Rs.725,750 Rs.857,550 Rs.934,500
(interest-free)
New Long-term
Rs.90,000 Rs.90,000 Rs.90,000
Liabilities
Sales of Other Current
Rs.0 Rs.0 Rs.0
Assets
Sales of Long-term
Rs.0 Rs.0 Rs.0
Assets
New Investment
Rs.395,000 Rs.300,000 Rs.300,000
Received
Subtotal Cash
Rs.5941,000 Rs.7809,790 Rs.9526,190
Received

Expenditures 2008 2009 2010

Expenditures from
Operations
Cash Spending Rs.1500,000 Rs.1500,000 Rs.1500,000
Bill Payments Rs.2212,430 Rs.2973,640 Rs.3406,900
Subtotal Spent on
Rs.3712,430 Rs.4473,640 Rs.4906,900
Operations

Additional Cash Spent

Sales Tax VAT
Rs.0 Rs.0 Rs.0
HST/GST Paid Out

38
Principal Repayment
Rs.0 Rs.0 Rs.0
of Current Borrowing
Other Liabilities
Rs.0 Rs.0 Rs.0
Principal Repayment
Long-term Liabilities
Rs.0 Rs.0 Rs.0
Principal Repayment
Purchase Other
Rs.0 Rs.0 Rs.0
Current Assets
Purchase Long-term
Rs.217,000 Rs.96,000 Rs.96,000
Assets
Dividends Rs.0 Rs.0 Rs.00
Subtotal Cash Spent Rs.3929,430 Rs.4569,640 Rs.5002,900

Net Cash Flow Rs.2011,570 Rs.3240,140 Rs.4523,290

Cash Balance Rs.2111,570 Rs.5351,710 Rs.9875,000

Projected Balance Sheet

The balance sheet indicates that at the end of the first year of operation net worth will be positive
and constantly increasing through the end of 2010.

Balance Sheet
Pro Forma Balance Sheet
2008 2009 2010
Assets

Current Assets
Cash Rs.21115,780 Rs.5351,710 Rs.98750,00
Accounts Receivable Rs.930,500 Rs.1123,260 Rs.1425,070
Other Current Assets Rs.0 Rs.0 Rs.0
Total Current Assets Rs.3042,070 Rs.6474,970 Rs.11300,070

Long-term Assets
Long-term Assets Rs.217,000 Rs.313,000 Rs.409,000
Accumulated
Rs.72,000 Rs.144,000 Rs.216,000
Depreciation
Total Long-term
Rs.145,000 Rs.169,000 Rs.193,000
Assets
Total Assets Rs.3187,070 Rs.6643,970 Rs.11493,070

Liabilities and Capital 1995 1996 1997

Current Liabilities
Accounts Payable Rs.310,060 Rs.238,530 Rs.283,730

39
Current Borrowing Rs.270,000 Rs.517,500 Rs.765,000
Other Current
Rs.725,750 Rs.1583,300 Rs.2517,800
Liabilities
Subtotal Current
Rs.1305,810 Rs.2339,330 Rs.3566,530
Liabilities

Long-term Liabilities Rs.1090,000 Rs.1180,000 Rs.1270,000

Total Liabilities Rs.2395,810 Rs.3519,330 Rs.4836,530

Paid-in Capital Rs.2395,000 Rs.2695,000 Rs.2995,000

Retained Earnings (Rs.2900,000) (Rs.1603,750) Rs.429,640
Earnings Rs.1296,250 Rs.2033,390 Rs.3231,890
Total Capital Rs.791,250 Rs.3124,640 Rs.6656,530
Total Liabilities and
Rs.3187,070 Rs.6643,970 Rs.11493,070
Capital

Net Worth Rs.791,250 Rs.3124,640 Rs.6656,530

40