Business Plan On

GAP LAPTOPS: FULFILLING YOUR GAPS

Submitted to: Prof V.K. Sapovadia, Prof Kishor Barad, & Prof Sharma

Shanti Business School, Ahmedabad PGDM Trimester II (Batch 2010-12) Continuous Evaluation in Business Plan
Submitted By: PARTH MALHOTRA 1011012039

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PREFACE
This report is being written in order to fulfill the need of the power point presentation for the final phase of the continuous evaluation. This report is written so that the business plan for a laptop company can be understood easily. This report is designed to provide a comprehensive understanding of a particular firms business strategy. All the parts in the report have been written in English as it is the most understandable formal language.

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TABLE OF CONTENTS
1. Preface 2. Executive summary 3. Purpose of the plan 4. Market analysis 5. The Corporation 6. Marketing and sales activities 7. Products 8. Target market 9. A journey to the end 10. Organization and personnel 11. Strategy and implementation 12. Financial data 13. SWOT analysis 14. Bibliography

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EXECUTIVE SUMMARY
The laptop industry was established when a number of laptops were manufactured by IBM, HP after 1981. The first laptop was manufactured in 1981 by Osborne. Now days a number of laptop manufacturers have established their units and the competition is increasing at a rapid pace. In such a developing world each and everybody is using laptops. Also the technology is changing at such a pace that the demand for good laptops is increasing day by day. To meet the demand, the supply also has increased. The current market scenario shows a positive fate for this industry as a huge number of laptops are being sold each day. People are going for the new technology. All they need is good configuration, battery management, heat control, light weightiness, attractive designs. Consumers are ready to pay a high price for quality and sturdiness. Notebook industry is the future of personal clientPC market. Based on predictions, the mobile computing notebook devices market are subdivided as ultra mobile sub notebookPCs and notebookPCs. Though notebooks are seen as the replacement of desktops most of the times, it is still a long way before notebooks sales overtakes that of desktops in number of units sold. WHO:-Gap Laptops Pvt. Ltd. WHAT:-Setting up a plant to produce laptops for the world. WHEN:-From next year plant will start producing (by 2012) WHERE: - The plant can be located at Mylapore, Chennai. WHY:-To provide machines for all the digital business and house-hold purposes. HOW:-By reducing the manufacturing cost and availing the mass production benefits. A huge success can also be achieved by implementing a new technology of solar power in the machine for power saving. OWNER:-Parth Malhotra CONTACT NO:-MOB: - +919624 900 602, PH: - 044 420 74358 E-MAIL ID: - gap.laptops@gmail.com

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Gap Laptops!!! Fulfilling your gaps is a start up manufacturing notebooks as a Private Company. Because of a rapid growth of notebooks from desktops, I will jump in the laptop segment. I will open my plant at Chennai because of huge disposable income and less expenditure. From the firm you can expect best service at reasonable price with good quality and new technology.

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PURPOSE OF THE PLAN

The IT sector is growing day-by-day. One of the important segments in the IT sector is the laptop segment. Technology is changing day-by-day and so are the consumers needs and wants. Laptops are the new trendy in-thing. Individuals prefer buying laptops rather than computers as they are new in technology, portable, easy to handle, less costly, etc. the demand of such portable machines is increasing day-by-day. To meet the increasing demand, a new firm is entering in the laptop market to fulfill the supply side. The purpose of this plan is simply to understand how this firm will work and survive in the competing market. This plan fulfills the entire criterion to show the working procedure of the firm. This firm is a new entrant in the laptop segment and therefore has to start a new journey. This plan is the structurized dataset of the firm. This is a business plan to show the business strategy of a new firm in the market. This plan has covered the main marketing and financial strategies of a new entrant.

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MARKET ANALYSIS
The present laptop market in India consists of various players like:                  Acer: TravelMate, eMachines, Extensa, Ferrari and Aspire Apple: MacBook, MacBook Air and MacBook Pro Asus: Asus Eee, Lamborghini, ASUS G Series(ROG) BenQ Dell: Alienware, Inspiron, Latitude, Precision, Studio, Vostro and XPS Fujitsu: Lifebook HCL: ME Laptop, ME Netbook, Leaptop and MiLeap Hewlett-PackardHP: HP Pavilion, HP Probook, Compaq Presario IBM Lenovo: ThinkPad, IdeaPad, and 3000 series LG: Xnote Panasonic: Toughbook, Satellite, Let's Note (Japan only) Samsung: SENS: N, P, Q, R and X series Sony: Vaio TG Sambo: Averatec, Averatec Buddy Toshiba: Dynabook, Portege, Tecra, Satellite, Qosmio, Libretto Zenith PC

Last year the laptop sales in India doubled. HP has the largest market share of 21 per cent in the Indian laptop market, followed by HCL and Lenovo. Besides the corporate sector, laptops have been in demand in the education sector, with schools and colleges encouraging their day-to-day use. Laptops sales have increased the most in the 18-36 years age group segment which includes students and home users. Size, weight, battery life and configuration are the most important factors consumers look at when they buy a laptop. Laptop sales have accounted for a decline in the sales of desktop computers and are expected to take over 40 per cent of the overall PC sales in India by 2011. The main reasons which are leading to increase in Laptop sales in India:
y y y y y

Tech awareness. Need of an Hour. Laptops preferred over PCs. (As they are portable) Laptops available at cheaper rates. Lifestyle of consumers.

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Growth Drivers:
y y

Indian Laptop market in now in sync with global market. It was in 2005 that sales of laptops surpassed the sales of desktop computers for the first time in India. The Laptop market is growing at a fast rate because of change in work life of consumers. As the need for "anytime anywhere" access to information is increasing, the sales of Laptops are also increasing. Other factors that are responsible for the hike in sales figure are reduction in prices and affordability. Laptops are now sold at approximately half the price at which they were sold two years ago. Laptops prices are now almost at par with the desktop computer prices. The third most important factor is duty free import of Laptops as a personal baggage that has helped a lot in increasing the penetration level of the product among the consumer population. Awareness about laptops has also increased over the years.

SALES GROWTH: Annual sales grew by 114%; CAGR: 104% Households: 44% of the market growing at 150%, Businesses: 56% of the market growing at 93%. Consumption in large and medium enterprises grew by 66% and 61% respectively, however in small enterprises it declined 10%. PC consumption in both West and South grew by 39% each; in East it grew by 10% while in North it declined by 13%. Notebooks are fast penetrating beyond the top 4 metros; growth rate 152%. Kid's laptops are very popular nowadays. Some of the laptops in market are: 1. Star Wars Darth Vader Laptop. 2. VTech Double Vision Notebook. 3. VTech Nitro Notebook. 4. Hot Wheels Accelerator 5.0 Learning Laptop.

GLOBAL MARKET SHARE: HP 20.8% DELL 15.1% ACER 14.6% TOSHIBA 9.3% LENOVO 7.5% FUJITSU / FUJITSU-SIEMENS 5.2%

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APPLE 4.6% ASUS 4.3% SONY 4.2% OTHERS 18.8% TOTAL 100% INDIAN MARKET SHARE: HP 37% LENOVO 16% ACER 10% DELL 9% TOSHIBA 9% OTHERS 19%

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THE CORPORATION
y COMPANY NAME: - Gap Laptops Pvt. Ltd. y BUSINESS TYPE:-Laptop manufacturing y LOCATION:- Mylapore, Chennai y CONTACT NO:-044-420 74358 y FAX:- 044-420 75438 y E-MAIL:- info@gaplaptops.com y WEBSITE:- www.gaplap.com y INVESTMENT REQUIRED:- Rs. 2 crores y PRODUCTION CAPACITY:- 1.5 lakh machines per month y NUMBER OF EMPLOYEES:- 180-200

MISSION: Gap Laptops Pvt. Ltd. is committed to provide people low price machines by maintaining the same quality level. VISION: The Companys vision is to provide laptop machines in best quality at a low price. The company wants to create a brand name which would be seen as synonyms to notebooks. OBJECTIVES: y y y y y y To provide people low price laptops. To maintain similar quality level. To achieve economies of scale by mass production. To make company popular in other parts also after it succeeds in Chennai the company will set some other plants in Bangalore, Ahmadabad, Punjab, Assam etc. To double the profit by 2014. To increase the sales by 2/3rd by 2014.

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FINANCING: The firm is planning to take loan from the Bank and Private money providers. Also the initial capital will be brought by the owner and 5 other partners. LOCATION: I will open the manufacturing plant at Mylapore, Chennai because in India, Southern India is the fastest growing area in India. Southern India was ranked the No.1 area in India to earn, invest and live. Furthermore, Chennai is an industrial hub for the production of many different products. A number of manufacturing plants have been constructed in Tamil Nadu and so it will be easy to get raw material from suppliers. My Location is at Athwalines Road because there are many manufacturing plants and firms, so, I can attract more corporate personals. TIME TO START: To start a business, first I will find my specific location and then construct my
manufacturing unit and hire employees. It will take a lot of time. I will start my business on the 4th day of June 2012.

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LOCATION OF OFFICES AND BRANCHES:

HEAD OFFICE GAP LAPTOPS G - 14, Prasad Chambers, Opera House, Chennai-600 001 Mylapore,

MAIN PRODUCTION UNIT GAP LAPTOPS PVT. LTD.

Athwalines Road
Mylapore, Chennai-600 001

SUB PRODUCTION UNIT GAP LAPTOPS PVT. LTD. 201, Pandol industrial estate, Mylapore-pandol Road, Mylapore, Chennai-600 001

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MARKETING AND SALES ACTIVITIES

I. PRODUCT

1. Brand name: Gap Laptops Pvt. Ltd.

2. Punch line: Fulfilling your gaps

3. Quality: A very effective machine that will fulfill all the needs which one individual looks in a normal computer. A machine with a new look and new technology. 4. Safety: Completely non-harmful materials are used in the manufacturing. Safe for daily use. Suitable for any person above 18 years of age. 5. Packing and packaging: The product will be packed with a strong plastic bag, then put into thermocol and then into a hard cardboard box. 6. Labeling: Labeling will include the following: A. Brief description of the machine B. Price, quantity, companys name, companys logo C. Barcode

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II.

PRICING

1. Pricing strategy: Penetrative and Competitive pricing- low price to attract more customers in comparison to the competitors. 2. Suggested retail price: The pricing will be done including the manufacturing costs, machinery cost, depreciation rate at 10%, fixed cost, variable cost, factory overhead, employees wages, cost of packaging, taxes and profit margin. The company will be selling out goods at the following prices per unit: Standard notebooks at Rs. 22500. Workstation notebooks at Rs. 30000 Office station notebooks at Rs. 35000

3. Price flexibility: Prices are flexible to the market conditions and to the cost of manufacturing and also to the prices of competitive products.

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III.

PLACE

1. Channel of distribution: Manufactured product will move through the following channel of distribution:-

This channel of distribution has been adopted as the company is new to the nation and distributing the product by us may result in new to the country and avoid this problem the company will collaborate with a distributor and as the market is very large it has to go through the dealers, to ensure proper distribution.

2. Inventory management: Production will be done on batch basis and when one batch will be under process and the raw material for the next batch is being fed, the raw material for the second consecutive batch will be procured. This will result in low storage cost and sufficient raw material for manufacturing.

3. Warehousing: The manufactured product will be stored in the companys warehouse near its plant before dispatching it to the distributor.

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4. Distribution centers: Eight distribution centers in:a. b. c. d. e. f. g. h. North North east North west South South east South west East West

5. Transportation: Company will collaborate with a transportation company to transport its goods from the plant to the warehouse and to the distributors place.

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IV.
1.

PROMOTION

Promotion strategy: Following strategies will be used to promote the product:-

a. Push and Pull Strategies- Push Strategy: We will be using push strategy to concentrate some of our marketing efforts on promoting our product to retailers to convince them to stock the product. A combination of promotional nix strategies will be used in this aimed at the retailer including personal selling, and direct mail, pushing the product onto the retailer. b. Pull Strategy: We will also be using pull strategy to promote our product amongst the target market to create demand. Consumers will pull the product through distribution channel forcing the wholesaler and retailer to stock it. This will be done through providing the customers with money off coupons or special offers. c. AIDA Strategy: The third strategy to promote our product will be the implementation of AIDA model which is

Attention

Interest

Desire

Action

This can be illustrated briefly as grabbing the attention of the customer, then holding his interest, then making the product desirable to him and finally making him to purchase the product. AIDA is an acronym for Attention, Interest, Desire and Action. This strategy can be made successful through effective advertisement etc. 2. Advertising: To create awareness about the product in the minds of the customers and to provoke their buying actions. Advertising will be done through the following mediums: a. T.V. spots b. Magazines c. Posters and flyers d. In- store displays

3. Personal selling: Personal selling will be done only in supermarkets and big stores, where a representative of the company will be made available to tell the customers and also help them about the benefits and the uses of laptops and also what differences our product from other available products.

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PRODUCTS
The name of the laptops will be Gap Laptops. The punch line is Fulfilling your gaps. The company is mainly oriented to manufacture notebook machines initially. The basic attributes of the product are as following:y

y y

Full-size Laptop: A laptop large enough to accommodate a "full-size" keyboard (a keyboard with the minimum QWERTY key layout, which is at least 13.5 keys across that are on (0.750) inch centers, plus some room on both ends for the case). The measurement of at least 11 inches across has been suggested as the threshold for this class. The first laptops were the size of a standard U.S. "A size" notebook sheet of paper (8.5 11 inches), but later "A4-size" laptops were introduced, which were the width of a standard ISO 216 A4 sheet of paper (297 mm, or about 11.7 inches), and added a vertical column of keys to the right and wider screens. Netbook: A smaller, lighter, more portable laptop. It is also usually cheaper than a fullsize laptop, but has fewer features and less computing power. Smaller keyboards can be more difficult to operate. There is no sharp line of demarcation between netbooks and inexpensive small laptops; some 11.6" models are marketed as netbooks. Ultra-thin Laptop: A newer class of laptops which are very thin and light. Tablet PC: These have touch screens. There are "convertible tablets" with a full keyboard where the screen rotates to be used atop the keyboard, and "slate" form-factor machines which are usually touch-screen only (although a few older models feature very small keyboards along the sides of the screen.) Rugged: Engineered to operate in tough conditions (mechanical shocks, extreme temperatures, wet and dusty environments).

The firm will also be launching machines which can also use solar power to recharge the battery of the machine. In the initial stages the firm will be producing machines of different configurations. Some of the configurations are: 1. y y y y y y y Standard Notebooks: Intel Core Duo 2 Processor, 2.53GHz 3.0 GB DDR2 SDRAM 320GB 7200 RPM Hard Drive Intel 4500-MHD Integrated GMA 14.1" WXGA Wide Panel 9Cell Primary Battery /90 W AC Solar power battery(optional)

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y y y y y y y 2. y y y y y y y y y y y y y y 3. y y y y y y y y y y y y

Adapter 8x DVDRW Drive 10/100/1000 Gigabit Ethernet, INT Wireless Windows 7 Professional 3 Year Limited Warranty STANDARD DELIVERED PRICE FROM: Rs. 22500. Workstation Notebooks: Intel Core Duo 2 Processor, 2.80GHz 4.0 GB DDR2 SDRAM 500GB 7200 RPM Hard Drive Intel 4500-MHD Integrated GMA 14.1" WXGA Wide Panel 9 Cell Primary Battery /90 W AC Solar power battery(optional) Adapter 8x DVDRW Drive 10/100/1000 Gigabit Ethernet, INT Wireless Windows 7 Professional 3 Year Limited Warranty STANDARD DELIVERED PRICE FROM: Rs. 30000. Office station Notebooks: Intel Core 2 Duo Processor, 3.06GHz 4.0 GB DDR2 SDRAM 500GB 7200 RPM Hard Drive Intel 4500-MHD Integrated GMA 14.1" WXGA Wide Panel 9Cell Primary Battery /90 W AC Adapter Solar power battery(optional) 8x DVDRW Drive 10/100/1000 Gigabit Ethernet, INT Wireless Windows 7 Professional 3 Year Limited Warranty STANDARD DELIVERED PRICE FROM: Rs. 35500.

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TARGET MARKET
 Industries- 1. Small-scale industries 2. Medium-scale industries 3. Large-scale industries  Families and nuclear families.  In-house offices.  Educational institutions. The main target market will be the businessmen who run different kinds of industries so that they dont lack any IT support.  Every person above 18 years of age.  High income, upper middle and middle class of urban and sub urban areas.  High income and upper middle class of rural areas.

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A JOURNEY TO THE END

RAW MATERIAL

WAREHOUSE

DISTRIBUTOR

INLINE PROCESS

PACKAGING

WHOLESALER

ASSEMBLING MACHINE

FINAL PRODUCT

MARKET

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ORGANIZATION AND PERSONNEL

During this process there may be requirement of 150-200 employees for three shifts, out of which 30 workers in raw material processing, 40 workers in manufacturing, 30 workers in assembling, 30 workers in packaging, and 25 workers for purchase and sales data collection and 25 employees for other works. The workers are divided into 3 categories: Categories Skilled Semi-skilled Unskilled Average salaries (in Rs.) 23,000-26,990 15,000-22.700 8,000-13,999

Organization and Management

Business be Organized
Gap Laptop Pvt. Ltd. is an establishment of 6 individuals. Its a private limited company. All individuals are coming for production of laptops with some new technologies. Ownership is based on shareholding which can be transferred to other shareholders with the consent of the existing owners. All individuals are bringing some share of the required capital on their own and the remaining capital will be taken over through the bank loan.

Management of Gap Laptops Pvt. Ltd.

Gap Laptops Pvt. Ltd. will be led by our Chief Executive Officer, who is responsible for managing profit and loss and delivering growth. It is supported in matters of sustainability by the GAP Sustainable Living Plan Steering Team, formerly the Corporate Responsibility, Issues, Sustainability and Partnerships (CRISP) leadership team.

Each of the main elements of the Plan is represented on the Steering Team by a senior executive who is accountable for ensuring the goals that are achieved by their target dates.

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Channel of Production:

Production manager

Assort manager

Planning manager

Assembling manager

Packaging and Checking manager

Assistant Manager (6)

Assistant Manager (6)

Assistant Manager (4)

Assistant Manager (6)

Workers

Workers

Workers

Workers

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Following will be the departments in my organization:      Manufacturing Sales & distribution Marketing & advertising Human resource Finance Administration
Top management (All 6 owners)

Chairman

Managing director

General Manager

Finance

Production

Marketing

Human Resource

Manager

Manager

Manager Manager

C.A.

Workers

Sales executives

Asst. manager

Comp. Operators

Asst. manager

Staff

Asst. manager

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STRATEGY AND IMPLIMENTATION

Laptops is fond of by youth speciously students, businessmen, nuclear family etc. because today no one has sufficient time even to carry data in huge machines properly thats why this segment occurs very rapidly. 1. SEGMENTATION STRATEGY:-

   

Low price notebooks for common Indians The important target audiences are the businessmen. The product will also be segmented on the basis of the better quality and less price. The company will also segment it on the safety portion by non-harmful materials. 2. DIFFRENTIATION STRATEGY:-

 The main variable of it is the quality and price. The company will provide good quality at lesser price.  The company will also provide huge distribution chain so that the difficulty of getting it may not occur.  The company will use indirect sales network channels which will be in contact to internal sales force of the company. 3. POSITIONING STRATEGY:-

 The main element of positioning gap Laptops is low price, good quality and new technology.  Laptop bag-packs with the product.

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FINANCIAL DATA
Building and Machinery (fixed Assets) are needed and what will be their Costs?
Equipment currently owned by the operator
Sr no. Type of equipment Qty Unit costs (in Total costs (in Remarks Rs.) Rs.) 1,50,000 4,50,000 2 Yrs depreciated

Vehicles

Furniture Total cost

5,00,000

5,00,000 9,50,000

*estimated costs

Equipments to be purchased by the operator

Sr. no. Type of equipment Qty Unit costs Total costs (in Rs.) (in Rs.) 2000/sq ft 15,00,000 1,40,00,000 30,00,000 Remarks

1) 2)

Land

7000 sq ft

Raw material gathering and 2 processing machine Main production machine Assembling machine Packaging machine Total cost 1 3 3

3) 4) 5)

13,50,000 2,00,000 3,50,000

13,50,000 6,00,000 10,50,000 2,00,00,000

*estimated costs

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Yearly production plan :

Gap Laptop Pvt. Ltd. is now assuming to target the local state market in the beginning period so that it can achieve a target of producing 1.5 lakh machines per month. So Gap Laptops Pvt. Ltd. will be having a yearly production target of around 18,00,000 machine units production capacity.

Financial Plan:
Capital requirement Equity (in Rs.) Loan Rs.) (in Total Rs.) (in

Investment capital: Machinery + equipment Furniture + fixture Business premises Working capital: Salary/wage Raw material and/or supplies Maintenance Business promotion 10,00,000 4,05,000 50,000 20,00,000 10,00,000 30,00,000 4,05,000 50,000 10,00,000 2,00,000 20,00,000 12,00,000 9,00,000 40,00,000 28,00,000 20,00,000 60,00,000 40,00,000 29,00,000

Other cash out of the business to meet other 2,00,000 requirements Total 53,50,000

1,18,00,000

1,75,55,000

*estimated costs

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Total Capital Requirement:

According to the above already mentioned, for establishment of the firm there is a minimum requirement Rs. 2 cores for machinery and other equipments as well as other variable expenses. Out of that, Rs. 80 lakhs will be brought in by the partners themselves and the rest 1.20 crore rupees will be in the form of a loan by the financial institutions.

Loan Repayment:
Gap Laptops Pvt. Ltd. is taking a loan from bank for a duration of 10 years. It has been decided to pay the interest rate, 10% p.a., and repayment scheduling is to be every year in equal installment.

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SWOT ANALYSIS
Internal/External Opportunities Strengths The low price manufacturing is the strength of the company. Weakness The weakness is only the experience in market as the company is new.

The quality is also exceptional.

This is an opportunity for the company to cater the market.

New technology of solar power is being used f or the first time and so it ca be a competitive advantage for the firm.

This will provide the company an opportunity in the not fully explored market. Threats The basic threat to the company is not too much experience in the market so the competition might hit it so the company has adopted the strategy of differentiation by giving low cost benefit and new technology. The weakness is the new entry in the market and it will cause threat of competition but the company is confident enough to turn it into opportunity by capitalizing it into strength.

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CONCLUSION THE ROAD AHEAD

Notebook industry is the future of personal clientPC market. Based on predictions, the mobile computing notebook devices market are subdivided as ultra mobile sub notebookPCs and notebookPCs. Laptops with extensive multimedia features continue aiming to gain more personal, home notebook users, whereas notebooks with longer battery life and higher performance will continue to cater the needs of business professionals. Gaming industry being itself in very nascent stages. There are several series in Dell and HP which cater to this group already. High speed connectivity and low weight notebooks generally are most demanded ones today. HP being top performer in multimedia and personal computer section should try to concentrate more towards capturing large organizations, and dell the vice versa. GAP LAPTOPS PVT. LTD. is a new firm in the notebook segment and is aiming to cater this segment by fulfilling all the possible gaps still left to be explored in this segment. The new firm has laid down certain principles, objectives and goals to penetrate the market.

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BIBLIOGRAPHY
I. II. III. IV. www.scribd.com/doc/37164794/PPT-The-Laptop-Industry www.docstoc.com/docs/23991129/The-Global-Laptop-Industry www.informationfeast.com/laptopindustry www.naukrihub.com

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