Executive Summary

Business Plan of Wood Land

Furniture has traditionally been a resource and labor-intensive industry that includes both local craft-based firms and large volume producers. Bangladesh furniture manufacturing as a whole has been a large and growing industry since 1990. After the recession of 1991, the gross output of furniture and related products grew steadily but output fell with the recession in 2001, but buoyed by the boom in residential housing, total furniture output growth quickly resumed. Wood Land came up with a revolutionary idea of establishing a warehouse based company. The objective of Wood Land is to provide distinctive and exceptional furniture at economic price which will satisfy all level of customers of our country and to export unique and attractive designed furniture to the developed and developing countries. The company initially will promote the product at local market and after 1-2 years the maximum turnover of the company will come from local market. After creating a good and sustainable market within the country Furniture Bangladesh will go for exporting their product in abroad. As economy in Bangladesh has become highly competitive, mixed with political instability and inflationary uncertainties, very carefully with innovative strategies the business has to be carried on. Wood Land must concentrate on Productivity, Efficiency and Management by Objective while starting the operation of the company. The most significant achievement of Wood Land Company is supposed to be the dynamism with far-sightedness in strategic planning. After three years and three months Wood Land will reach in Break Growth of Wood Land will be supported by cash flow and bank loan. This will keep initial growth slow and manageable and will allow the management to have complete control over the firm. Wood Land acquired insurance for our company from Federal Insurance Co. Ltd and from Bangladesh National Insurance Co. Ltd. Now days suppliers are selling their product direct to the retailers and people are good to have their own brand. Manufacturers are supplying products to retailers on credit and get the money long after the selling. So, retailers will not want buy products from Wood Land on cash. We can innovate lucrative, exclusive and unique design at an economic price that will generate a good impression on customers, and then the demand of our product will be increased. Due to this high demand of product the unit price of our product will be less than the direct manufacturers. As the retailers can earn more profit by selling our product, the retailers will eager to take our product on cash. After the initial investment we will be able to earn a very good portion of the market share and we will be able to invest in different market segment.

Business Plan of Wood Land

Company Profile

Name of the Project: Wood Land Type of Business: Distributor of Furniture Status of Ownership: Private Limited Company Address and Location: Warehouse and Office address: 131, Amin Bazar, Savar. Showroom address: Rahman Mansion, House no.: 3/11 (Ground Floor), BlockG, Kazipara, Mirpur, Dhaka.

Brief Description: Wood Land is a proposed new member of furniture sector of Bangladesh, aimed to sell high quality, lucrative, well designed furniture primarily in Bangladesh market. Primary products will be Bed, Bed side table, Center table, Chair, Dining table, Dining chair, Sofa set, Showcase, Divan, Dressing table, Ware drove, Mini cabinet, Door, TV cabinet Almirah etc. The project is estimated to be with initial investment of BDT 15 million with equity investment of BDT 6 million and the rest from long term bank borrowing. The project is expected to start its operation from August, 2010, 6 month from now. The target market of this project is mainly middle to upper income class people.

Project Cost: BDT 15 million Equity Involvement: BDT 6 million Bank Borrowing: BDT 9 million Debt Equity Ratio: 60:40 Initial Startup Cost: BDT 4.259 million Break- Even: 3.3 years

Viability Measurement Current Ratio: 2.036 Operating Ratio: 0.644 Net Profit to Equity Ratio: 0.4959 Net Profit on Sales: 0.402 Margin of Safety: 17.52%

Business Plan of Wood Land

Company Background
Overview of the Furniture Bangladesh
Our company will be formed in August 2010, by Uttam Kumar Nandi, Md. Aminul Quayyum, Md.Sabbir Ul Alam, Md. Dewan Saifuddin Ahmed and Mahjabin Afrose Archi. This will be a new venture and we dont have any association with any other business. Our company would be one of the first of its kind in Bangladesh. Liabilities will have an equal share of burden also, providing each partner a strong incentive to establish a strong business entity. Wood Land has decided to enter into the furniture industries of Bangladesh with a new and innovative idea. There is not much competition in the Snacks food marketing. Few companies dominate the whole market. The survey shows that people are always interested in new designed furniture at economic price. So Wood Land came up with a revolutionary idea of establishing a warehouse where retailers can buy their desired product at an attractive price and retailers and supplies both will be in win position. Corporate Management and Human Resources: The company clearly has a dynamic and inspired management. The company operates as an independent entity headed by the Managing Director while overall strategic objectives and the corporate management committee set financial targets. To achieve targets, the group employs highly qualified and well-trained staffs. Each operating unit has its own human resources which is guided or supported by the manager of that unit and the final decision are taken by the Managing director. The Human Resource Manager is responsible for providing policy guidelines and systems to facilitate the recruitment, development and maintenance of a high achieving work force. Management Excellence- dynamic strategy with far-sighted planning:

Business Plan of Wood Land The most significant achievement of Wood Land Company is supposed to be the dynamism with far-sightedness in strategic planning. Moreover the company employs people with excellent capability in managing cash flows and projects and handling of economic trend to predict demand. The company is aimed to achieve its goal through proper and efficient utilization of the resources by professionalism and perfect distribution of labor and thus to attain well-being for this society.

Name of the business

We have named our warehouse based business as Wood Land. As we are pioneering the field of small venture capitalism in Bangladesh we think it is appropriate to add the name after that.

Potential of this Venture

Someone might argue that, retailers would not buy furniture though Wood Land rather than direct manufacturer and currently manufacturer are supplying products to retailers on cash. So, why retailers should buy on cash through Furniture Bangladesh?

The answer would be- Uniqueness of this business. The unique and lucrative design at economic price and the win-win situation for supplier and Wood Land will attract the retailers to buy products on cash from Wood Land rather than direct manufacturer.

Objective:
Our objective is to rediscover this industry with a significant difference from others operating in this industry. Our distinctiveness would be the unique idea as well as the design. Our company will be situated at an ideal and effective location which will facilitate both the suppliers and the retailers. The objective of Wood Land is to provide distinctive and exceptional furniture at economic price which will satisfy all level of customers of our country and to export unique and attractive designed furniture to the developed and developing countries, which will increase the reputation of our country and also contribute a lot to the economy of our country.

Business Plan of Wood Land Finally, we believe that our unique idea with distinctive and lucrative design at economic price, the Wood Land is a great initiative that will certainly become a success.

Slogan:
There are many who want such stylish and distinctive furniture at economic price which will increase the status and position of the customers. That is why the slogan of Wood Land will be-

A Unique Combination of Style and Imagination

Mission:
The main mission of the company would be to provide an opportunity to the all level of people of Bangladesh to establish their dreams through unique and attractive designed furniture which will represent the style, standard of living and status of them. Wood Land is committed to provide distinctive and exceptional furniture at economic price which will satisfy all level of customers.

Making the Service Acceptable by All

Vision:
The company initially will promote the product at local market and after 1-2 years the maximum turnover of the company will come from local market. After creating a good and sustainable market within the country Wood Land will go for exporting their product in abroad. The vision of Wood Land is to export unique and attractive designed furniture to the developed and developing countries, which will increase the reputation of our country and also contribute a lot to the economy of our country.

Enhancing the Standard of Living and People

The existing or proposed products and services:
The industry in which our business will be operating is the Furniture Industry. The objective of this industry is to serve people with lucrative and attractive designed furniture. There is a wide variety of suppliers and retailers are available with different design and price structure as well as quality. Unlike the market, the industry is growing as well with some differences from each other. But its our firm belief that the furniture industry is way beyond from reaching the saturation.

Business Plan of Wood Land

Startup Points:
The project is expected to start its operation from August, 2010, 6 months from now. The target market of this project is mainly middle to upper income class people.

The Company Ownership

Wood Land is a privately held company owned by two of its investors and the profit will be shared by its investors equally. The owners of Furniture Bangladesh are as follows: Uttam Kumar Nandi Md. Aminul Quayyum Md. Sabbir Ul Alam Md. Dewan Saifuddin Ahanmed Mahjabin Afrose Archi

As for other personnel since we are starting in a very challenging level thus the owners has decided to take no profit rather reinvest the income into the business for the first two years and thus after the business reaches a desirable position enjoy the profit as well as salaries.

Investment plan:
The project is estimated to be with initial investment of BDT 150 million. Each partner will contribute an equal amount of BDT 1.2 million. The rest of the amount will be finance through bank loan. Standard Charted Bank will finance the money. The equity ratio is as follows Serial No 1 2 3 Particulars Equity Money Bank Loan Total Amount in BDT 6,000,000 9,000,000 15,000,000 Ratio 40% 60% 100%

The equity ratio is 40% of total amount and the bank loan will be deposited in the manner of property mortgage.

Board of Directors
Name Designation

Business Plan of Wood Land Uttam Kumar Nandi Md. Aminul Quayyum Md. Sabbir Ul Alam Md. Dewan Saifuddin Ahammad Mahjabin Afrose Archi

Director of Marketing and Sales Director of R&D Director of Operations & Logistics Director of Finance & Accounts Director of HRM

Board of Directors Profile

Director of Marketing and Sales, Uttam Kumar Nandi is a MBA graduate from East West University. He has got excellent rationing ability and immense knowledge about market forces and selling techniques. He deals with the companys marketing and sales activities.

Director of Operations & Logistics, Md. Sabbir Ul Alam is a MBA graduate from East West University. He takes care about the overall operation of the business. The main reason that he had been appointed in this post can be acquire from his best quality creativity and innovation Director of R&D, Md. Aminul Quayyum is a MBA graduate from East West University. He has got a great sense of timing and location and he is also very efficient in doing channel management. That is why managing personnel thus R&D, and distribution is under his territory.

Director of Finance and Accounts Md. Dewan Saifuddin Ahammad is a MBA graduate from East West University. He has done major in Finance and minor in Accounting. He is very efficient in managing the financial matters and cash flows. In addition, he has deep knowledge about the money market and capital market. Thus he has been designated to controls the financial activities of the business. Director of HRM Mahjabin Afrose Archi she is MBA graduate from East West University. She has got colossal experience in extracurricular activities and management. She always takes care of the design and the quality of the product.

Business Plan of Wood Land

Business Plan of Wood Land

Products and Services

Wood Land is going to introduce a warehouse based furniture company in the Bangladeshi market. Normally Bangladeshi market is filled with manufacturer and retailers. Many furniture companies manufactured and sell their product and some are retailers who only sell the product but not manufactured it. Wood Land will not manufacture any product rather then they will manufacture their product by some suppliers and sell them to the retailers with their own brand name.

Current Targeted Products

Primary products will be

Bed Bed Side Table Center Table Chair Dining Table Dining Chair Sofa Set Showcase Divan Dressing Table Ware Drove Mini Cabinet Door TV Cabinet Almirah Dinner Wagon Open Shelf

Business Plan of Wood Land With the increase of the volume of our business, we will also increase the product category of Wood Land.

SWOT Analysis

Strength Achieves a competitive advantage since there is no such warehouse or distributor in the market that incorporates such extraordinary features Strong presence in local market and has interest or future plan to export Wood Land has a very strong management team and a skilled and efficient worker team Geographically situated at ideal location (near both suppliers and retailers) Wood Land has a level of productivity that is unique in the country Availability of cheaper supporting strafe Cash sell to the local customer Extraordinary and attractive design of furniture All type of earning people can afford our product

Weakness Retailers unwillingness for cash payment Low earning income people cannot afford to buy our product. Employee switching to the other company Limited access to information (availability of finance, technological know, how & Govt. regulations)

Opportunities New and innovative design for the target market will gradually expand to the full market coverage Increasing fashion and style awareness of customers Research and development and cost utilization Large local and international target market Enthusiastic human resource

Business Plan of Wood Land

Threats Political and economic instability Change of huge foreign exchange rate Other firms can easily imitate our strategy

Competitors Position
Competitors and type of competition
We are assuming, in our country this type of idea is new and unique. There is some companies in the market such as Hatil, Otobi, Brothers Furniture who are manufacturing furniture and selling those. But our strategy is quite different from them because we are not manufacturing furniture, we only collect them from our dedicated suppliers and sell them to our selected retailers. We are assuming there is such no other competitor in the market. Those can be classified as secondary competition.

Competitors' strengths and weaknesses

Business Plan of Wood Land

Strength The strengths that our competitor has are-

Weakness The weaknesses that our competitor has are-

Our

competitors are serving the mass market. So there is little chance for being in loss. are in this business for a long time. So they have the required experience regarding this field.

Our competitors are not focusing in the idea that we are planning to serve. Thus they have the chance of losing market share. This company is facing problem to maintain a balance between suppliers and retailers They dont have any detail concept about this new form of warehouse based system. They are not interested to penetrate the global market

They

Enough scope for investment. They

have a well established reputation in the market.

Competitive advantage:
Our main competitive advantage is we are investing in such a place where no other business has invested. Our unique idea to establish a warehouse based Furniture Company is a new concept in Bangladesh. As we are trying to sell our

Business Plan of Wood Land product at cash to the retailers, so there is always chance of getting high returns on investment in the sector and the chance of losing money as bed debt is less.

After the initial investment we will be able to earn a very good portion of the market share and we will be able to invest in different market segment.

Business Plan of Wood Land

Management Team
Wood Land will have an efficient and effective management team. The project is estimated to require a total of 23 employees. Sales & Marketing, Finance & Accounts, Human Resources and Procurement manager has to at least 5 years experience in their work and skilled enough. They have aced many crisis situations in their past working life and handle them successfully. As mentioned before, we wish to provide splendid service to our customers. But it will not be implemented properly if the required personnel are not available. Therefore, in order to operate our business efficiently in every step, we have to hire some qualified employee. A Receptionist will be hired to assist and update the customers about the facilities and procedure of ordering the products. He or she will be appointed as per the minimum qualification held by the Management.

Roles and Responsibility of Managers of the Organizations

Managing Director:

Business Plan of Wood Land The managing director is the coordinator will coordinate all the department of management of Wood Land. All the employees will work under his/ her control and he/ she is the final decision maker. Deputy Managing Director: The deputy managing director will help managing director to coordinate the entire management department. He/she will as a helping hand of managing director. Accounts and Finance Manager: The accounts and finance manager of Wood Land will look after to major section of the organization. For accounts section he/ she will established and accounting system within the organization and maintain that. Predation of financial statement, maintaining journal and ledger daily basis, will be his/her routine function. Under the finance department he will keep a close eye on the cash flow and advise the deputy managing director and managing director for principal capital and investment. Sales and Marketing Manager: He/she is the leader of the marketing executive of Wood Land. All the marketing such as coactions submit, order collection, accounts receivable collection, advertising and promotional activities etc. He/she will also control and moderate the international marketing. Operations & Logistics Manager: Operations & Logistics manager will be responsible for all production related activities within the organization such as supplier selection, production monitoring, inventory control, facility selection and design, in house transportation management. Human Resources Management and R&D Manager: Human Resources Management and R&D manager will be responsible for all research and development related activities within the organization such as new design preparation, machine utilization, cost minimization and also responsible for selecting new and dynamic human resources and their control and monitor. The detail human resource schedule is shown below: Designation Managing Director Deputy Managing Director Finance & Accounts Manager Sales & Marketing Manager Operations & Logistics Manager HRM and R&D Manager No. of Person (s) 1 1 1 1 1 1

Business Plan of Wood Land Sales and Marketing Executive Procurement Executive Commercial/Logistic officer Accountant Computer Operator Support Staffs Total Office Personnel 3 2 2 2 1 7 23

Policies and procedures of HR:

Wood Land will follow the government & labor rule as treat our employee. Other than that in occasion everyone will receive bonus. For vacation and time hour we will follow labor act. 1965. Every employee will get equal employee opportunity. If any employee does any mal pracitce he/ she will be sacked from the job or will be fined based on the management discretion. Business will panalize employees for breaking any code of conduct Employees will be recruited on management discretion. Every employee will get break for half an hour after every 5 hours. At least 30% of our employee will be women even handicaps people will get the job if he posses the ability to do the job. Their annual weekend day will be in Friday. We will pay all the salaries within first 10 days of month

But the part-time and contractual employee will be treated differently.

Compensation Packages
Human Resources of Wood Land (Monthly Salary Schedule) Salary per month 50,000 40,000 30,000 30,000 30,000 28,000 Total Annual Cost 600,000 480,000 360,000 360,000 360,000 336,000

Category Managing Director Deputy Managing Director Sales & Marketing Manager Finance & Accounts Manager Operations & Logistics Manager HRM and R&D Manager

No. (s) 1 1 1 1 1 1

Business Plan of Wood Land Sales & Marketing Executive Operations & Logistics Executive Commercial/Logistic officer Accountant Driver Computer Operator Guard Peon Sweeper Total Head office personnel

3 2 2 2 2 1 2 2 1 23

20,000 20,000 15,000 8,000 5,000 4,500 3,500 3,000 2,000 289, 000

240,000 240,000 180,000 96,000 60,000 54,000 42,000 36,000 24,000 3,468,000

Efficient Management Policy for Wood Land

As a starter distributer firm, Wood Land has to be highly efficient and must ensure smooth development. As economy in Bangladesh has become highly competitive, mixed with political instability and inflationary uncertainties, very carefully with innovative strategies the business has to be carried on. There quite a few major areas where Wood Land must concentrate while starting the operation of the company. Productivity: Employees and management must ensure the maximum productivity in production and management activities. To ensure productivity, employees must be given a fair work environment, fair compensation package and training. Hand on training for factory employees and workshop in management skills for head office employees may boost the productivity of employees. Efficiency In this competitive business environment and high rising inflationary economy, this is quite difficult to profit at the desired level and sustain profitably. To sustain profitably, Wood Land must ensure cost efficiency in importing and purchasing local inputs. Along with that, management expenses must have to be kept at the minimum level. Management by Objective (MBO) MBO is a process where management finishes every task setting a prior objective. Ever task must be planned with appropriate timing and a set objective. Every

Business Plan of Wood Land employee should be given any task with a time limit and a target. The higher management of Wood Land should ensure that every employee is finishes the task within given time frame and thus achieving the set goal. With this process, management may break up long term tasks in to small goal or objective oriented tasks with time limitation. Achieving objectives one after another would make the way to the long term goal. This policy has been excellent in managing large and medium enterprises that Wood Land can apply. MBO is highly applicable for starter companies where every task is finished within time and with higher degree of accuracy. Employee Performance Appraisal Every employee must be supervised by respective senior subordinates and performance report should be prepared taking into account every task finished by the employees. Transparency and Accountability The high management must maintain true degree of transparency and accountability in their operations and disclose as much information as they can to the stakeholders. Corporate Governance The operation of Wood Land should take into account the views, recommendations of all parties related to the business. The goal setting and decision making by the Wood Land management must be fairly complied with the interest of every stakeholder group supplier, customers, employees, regulators, debtors and social groups. Smooth Decision Making Decision making in the company must be smooth. Delay in decision making may cost the company. If necessary, in decision making employee participation should be ensured by Wood Land.

Action Plan
Action plan is the total plan of activities which is needed to carry out the operation of the Wood Land ". The following footsteps will be taken:

For Initiating the Business:

Partnership agreement: The five partners of our business Uttam Kumar Nandi, Md. Aminul Quayyum and Md. Dewan Saifuddin Ahammad, Md. Sabbir Ul Alam and Mahjabin Afrose Archi are the five founders of the Wood Land "thus will make the partnership agreement among themselves. Gathering capital from members:They will provide capital of Tk 2,000,000 each in starting the business.

Business Plan of Wood Land Taking lease of the warehouse & office: We will make leasing agreement with a Lessor for the warehouse and office building after coming to a price negotiation. Hiring employees: Employees will be hired for different positions in different department will be hired as business expands. Office supplies: For the office supplies an eligible supplier will be chosen based on his quality of service and terms of supplies. Supplier Selection: The supplier of the furniture will be selected who will provide furniture according to our design and requirment. After coming to a price negotiation aggrement will be signed with the selected suppliers. Giving advertisement: The design and campaign will be based on the Affordable method so that we can save as many capital for the contingent plan as possible. Selection of retailers: The retailers of the furniture will be selected who will buy our products. After coming to a price negotiation aggrement will be signed with the selected retailers.

For Achieving Business Objectives

Identifying which designs are more acceptable by the potential customers. Giving training to employees to achieve the desired efficiency Making strong promotional campaign to increase familiarity of our service and the number of customers. Strong monitoring of the Debtor is must to avoid any deficiency.

Capital Requirement Plan

The capital needed to continue the business and the start up cost is given below. Particulars Warehouse & Office Lease (1 year) Warehouse Decoration Office Decoration Showroom Lease (1 year) Showroom Decoration Employees Salary (1 month) Furniture & Fixtures Vehicle Rent (1 year) IPS BDT 1,200,000 150,000 250,000 500,000 150,000 289, 000 200,000 150,000 100,000

Business Plan of Wood Land Prepaid Insurance Electricity, Gas & Telephone Advertisement Others Sub-total: 500,000 30,000 100,000 640,000 4,259,000

So the start up cost of our business will be BDT 4,259,000

Financial Aspect of Project

The financial plan for our business contains of income statement, balance sheet, cash account, ratios which are described with some assumptions as follows-

Important Assumptions
Some of the more important underlying assumptions are: We assume a strong economy, without major recession. We assume the creation of Wood Land " will not dramatically change the current policies of the finance ministry. Interest rates, tax rates, and personnel burdens are based on conservative or Pessimist assumption.

Sources of Financing

Business Plan of Wood Land The project is estimated to be with initial investment of BDT 150 million. The total amount will be finance through bank loan. Standard Charted Bank will finance the money. As for the Office it will be taken on lease from the lesser at Total Lease payment of TK 1,200,000 including interest. As well as in order to maintain security of the business, a pre-paid Insurance of TK 500,000 will be acquired.

Government Support
Since our firm would be facilitating GDP of Bangladesh from the currently unproductive sector, social welfare concerns of the firm are automatically achieved. National Board of Revenue (NBR) will provide us with a tax holiday so that we will not have to bother about income tax expense for the first five years.

Means of Finance
Particulars Equity : Promoters Equity Loans: Bank Loan Total Percentage 40% BDT 6,000,000

60% 100%

9,000,000 15,000,000

Debt Equity Ratio

Debt and Owners equity ratio is 40: 60

Pro-forma Income Statement

Growth of Wood Land will be supported by cash flow and bank loan. This will keep initial growth slow and manageable and will allow the management to have complete control over the firm. The pro-forma income statement of upcoming three years of Wood Land is given below:

Income Statement of Wood Land Particulars First Year Second Year (BDT) (BDT) Sales 17,000,000 20,600,000 Direct cost of sales 9,350,000 11,330,000

Three Year (BDT) 27,600,000 14,630,000

Business Plan of Wood Land Other costs Total cost of sales Gross Profit 240,000 9,590,000 7,410,000 312,000 11,642,000 8,958,000 432,000 15,062,000 12,538,000

Expenses Sales & Marketing 132,000 Property & Utilities 240,000 Insurance 100,000 Rent 1,850,000 Depreciation 15,000 Others 200,000 Total Operating 2,537,000 Expenses Profit before Interest & 4,873,000 Tax Interest Expenses 900,000 Tax Incurred 993,250 Net Profit 2,979,750

171,600 312,000 100,000 1,850,000 15,000 200,000 2,648,600 6,309,400 900,000 1,352,350 4,057,050

237,600 432,000 100,000 1,850,000 15,000 200,000 2,834,600 9,703,400 900,000 2,200,850 6,602,550

Figure: Net Income vs. Year graph The above graph shows the constant growth rate the business is able to achieve for the initial three years. Although the net income is increasing at a slow rate, it will take a big leap when the business grows for expansion and increases the number of loans it is currently financing.

Business Plan of Wood Land

Pro-forma Balance Sheet

The pro-forma balance sheet of upcoming three years of Wood Land is given below: Balance Sheet of Furniture Bangladesh First Year Second Year Particulars (BDT) (BDT) Assets: Fixed Assets Current Assets: Cash Accounts Receivable Inventory Other Current Assets Long Term Assets: Accumulated Depreciation Net Profit Total Assets Liabilities & Owners Equity Accounts Payable Insurance Lease Payment Subtotal current liabilities Long Term Liabilities Owners Equity 300,000 14,400,000 5,100,000 2,500,000 1,000,000 15,000 2,979,750 26,294,750 285,000 16,920,000 6,180,000 2,500,000 1,000,000 15,000 8,958,000 35,858,000

Three Year (BDT) 270,000 21,820,000 8,280,000 2,500,000 1,000,000 15,000 12,538,000 46,423,000

9,344,750 100,000 1,850,000 11,294,750 9,000,000 6,000,000

18,908,000 100,000 1,850,000 20,858,000 9,000,000 6,000,000

29,473,000 100,000 1,850,000 31,423,000 9,000,000 6,000,000

Business Plan of Wood Land Total Liabilities and Owner Equity

26,294,750

35,858,000

46,423,000

Ratio Analysis
Ratio analysis is a numerical attempt to analyze the performance and financial position of a business. By converting absolute numbers into ratios, we can compare between one firm and another, or between several periods of one company. Indeed, ratio analysis, which is the interpretation of ratios, cannot be meaningfully achieved without some form of comparison. Ratio analysis expresses the relationship among selected items of financial statement of data. A ratio expresses the mathematical relationship between one quantity and another. The relationship is expressed in terms of a percentage, a rate or a simple proportion. For analysis of the primary financial statements, ratio can be used to evaluate liquidity, profitability and solvency. Ratio Analysis enables the business owner/manager to spot trends in a business and to compare its performance and condition with the average performance of similar businesses in the same industry. In order to do this, a firm can compare its ratios with those of businesses similar to the company as well as compare its own ratios for several successive years, watching especially for any unfavorable trends that may be alarming. Ratio analysis may provide the all-important early warning indications that allow the firm to solve its business problems before there is any sort of destruction. Ratio can provide clues to underlying conditions that may not be apparent from individual financial statement component.

Liquidity Ratios
It measures whether or not the small business will be able to meet its maturing obligations as they come due.

Business Plan of Wood Land Current Ratio - Measures solvency by showing the firm's ability to pay current liabilities out of current assets. Current Ratio = Current asset/ Current Liability = 23,000,000/11,294,750 = 2.036

Interpretation: We should have no problem meeting our short-term debts as they come due. Operating Ratio - Evaluate the firms overall performance and show how effectively it is putting its resources to work.

Net Sales to Total Assets Ratio - Measures the firms ability to generate sales given its asset base. Net Sales to Total Assets Ratio = Net sales / Total Asset = 17,000,000/ 26,294,750 = 0.644 Interpretation: We think the ratio is quite good as it is generating nearly 64.4% return from assets. However, since the Building is acquired on lease, it requires generating greater sales if we really want to be profitable.

Profitability Ratios
Measure how efficiently the firm is operating; offer information about the firms bottom line. Net Profit on Sales Ratio - Measures the firms profit per dollar of sales revenue.

Net Profit on Sales Ratio = Net Income/ Sales revenue = 2979750/7410000 = 0.402 Interpretation: This means more than Tk 0.402 of profit can be earned from each takas revenue which is a pretty promising return from a new venture.

Business Plan of Wood Land Profit Margin- Profit margin is an indicator of a company's pricing policies and its ability to control costs. Profit margin = Net Income / Sales = 2979750/170,000,000 = 17.52 % Net Profit to Equity Ratio - It measures the owners rate of return on the investment in the business. Net Profit to Equity Ratio = Net Income/ Owners equity = 2979750 / 6000000 = .4959 Interpretation: the ratio is quite acceptable as it is giving a return of around 49.59 % which is more than acceptable given the economic condition in BD and the situation of security Industries.

Break-Even Analysis
Wood Land will be reached in break even after three and half years the operation started. Total Investment: BDT 15,000,000 Year Year 1 Year 2 Year 3 Total 3 years profit Average net income per year = BDT 4,546,450 Break Even Time = BDT 15,000,000 / BDT 4,546,450 = 3.3 years Net Income (BDT) 2,979,750 4,057,050 6,602,550 13,639,350

Business Plan of Wood Land That means after three years and three months Furniture Bangladesh will reach in Break Even.

Operating Plan
The purpose of the Operations Plan is to describe where our business will be located (along with any physical necessities) and how we will provide services to our clients. Hence the Operating Plan will describe how the service will be provided to our valued customers and how this plan will enable Wood Landto position itself to play a significant role in the medium business industry of Bangladesh. The Operating plan pays particular attention to how the service will be provided, including descriptions of the firms facilities and processing requirements needed for operating. In addition Wood Land " has a number of specific strategic objectives all of which are addressed by this plan. These are to: Provide products to large businesses take advantage of this innovative idea and will be expecting a profitable rate of return. Wood interested in investing in smaller scale businesses.

Land

" is very much

Here we can divide our business operation into two parts. They are-

Business Plan of Wood Land Stage of Development Production Process section

Stage of Development: In this section we are going to describe that on what basis, how and to whom we are going to provide our services. At first we will select the supplier who will provide us product according to our design at an economic price and the retailers who are interested to buy our products. We will try to sell our product to the retailers and we will collect the orders from them. Simultaneously we will give order to the supplier to manufacture our designed product. There will be an agreement between the suppliers and us that they will not sell our designed product anywhere. After completing our

Production Process Section: Here we are going to describe the physical aspect of our business operations. Such as our firms location, its current and future capacity, requirements of equipment and technological, in our day to day operation and any environmental or other regulations that apply. These are described below:

Company Locations

Location planning
Better approach for location planning is to consider how location impacts development of long-term capabilities. Most of the furniture suppliers are located outside from Dhaka and most of the retailers are situated inside of the Dhaka. So warehouse and office are placed in Savar and the showroom are placed in Kazipara, Mirpur, Dhaka. Advantages:

Minimum transportation costs

Business Plan of Wood Land

Proper supply of labor Better communication with suppliers and retailers Provide acceptable service Communitys positive attitude

Address
Warehouse and Office address: 131, Amin Bazar, Savar. Showroom address: Rahman Mansion, House no.: 3/11 (Ground Floor), Block-G, Kazipara, Mirpur, Dhaka.

Size and Capacity

The size of warehouse and office space is around 3200 sq. ft. and the space will include a well furnished working place for our employees, good ventilation system and other facilities. We have also planned to expand our warehouse and office space in near future. The size of showroom space is around 3200 sq. ft. and the space will be highly decorated and well furnished.

Advantages Or Disadvantages
As we are conveniently located close to our supplier and retailers, we can maintain the transportation and communication more efficiently. However, in this place we have many competitors. Also with the change in market focus to consumers, the building lacks display/working space.

Lease or Ownership Details

Our business is to provide lucrative and unique designed furniture, where we need to invest a huge amount of capital. But as we are venturing our business as a new entrepreneurship, we have a budget limitation which is a major concern for us. It leads us to take lease the warehouse and office space to operate our business rather than acquiring the warehouse and office space place. We are taking lease from the owner of an attractive market in Amin Bazar, Savar with an agreement of 1 year and the cost for the lease will be BDT 1,200,000. For the same reason, we are also taking lease the showroom to operate our business at Kazipara, Mirpur, Dhaka with an agreement of 1 year and the cost for the lease will be BDT 500,000.

Business Plan of Wood Land Through the leasing of our office space, we will provide services to our potential customers. Taking lease will not only help to overcome our budget limitation, but also help us in different aspects which are as follows-

We can negotiate for a short-term lease and increase the timeline and even offer a bargain purchase option at the end of the lease term to acquire the place in a less amount. We can spread the lease over longer periods than a rent, thus reducing the monthly payments.

In taking lease, we might have to accept some disadvantages and inconvenience which are-

We have to give a yearly payment for leasing the Building but the ultimate cost of the Building to construct the office will be higher than if we could purchase it.

But as a new entrepreneur we have to accept many challenges and difficulties to set-up our business. Best possible term for us would be negotiating with them for the terms and conditions that would be best suitable for us.

Time of Operation
Our firm will provide service from 9.00 am - 5.00 pm on weekdays to our valuable client.

Facilities
To regulate the business operation properly we have the followings facilities which needed to be maintained carefully. They are:

Supplies:

In operating this business, we will need the supplies of different things:

Business Plan of Wood Land

Utilities: We will contract with some suppliers who will provide us the seal of business, necessary paper, pen, and stapler etc. which will be needed for operating our business. Food facility: We will provide food facility like snacks and refreshments to our customers. In this regard, we will negotiate with some food suppliers, who will consecutively supply the foods as per our requirements. Equipment and Office supplies: Equipments like Computers, Fax machines, Printers and so on will be facilitating in the office. As well as other supplies like Office furnitures, two lines of telephone will be used for each office room. Telephone - one line currently serves the location. A second line for data use should be added soon. Utilities are already provided, included in the space rent of the building.

Loan facilities: Initially we need loan of 9 million BDT. We will take loan from the Standard Charted Bank since the Small and Medium Enterprise Officer of that Bank Mr. Harun-ur-Rashid has conveyed his willingness to crack us a flexible deal.

Insurance facilities: Insurance will be acquired in order to maintain the leased Assets as well as to tackle the remedies in any emergency. We have acquired insurance for our company from Federal Insurance Co. Ltd and from Bangladesh National Insurance Co. Ltd. This insurance falls under general insurance category.

Bangladesh Co-operative General Insurance Ltd. Biman Bhaban (2nd Floor) 100, Motijheel C/A, Dhaka-1000, Tel: 7171942

Bangladesh National Insurance Co. Ltd. Raj Bhaban (8th floor) 29, Dilkusha C/A, Dhaka 1000 Tel: 9666361-8

Business Plan of Wood Land

Marketing Strategy \
Our company is a warehouse based furniture company. So it is very natural that we will follow different marketing strategy by considering our target market. The company initially will promote the product at local market and after 1-2 years the maximum turnover of the company will come from local market. After creating a good and sustainable market within the country Wood Land will go for exporting their product in abroad. So the marketing strategy of Wood Land can be divided into two categories:

Local Marketing Strategy Global Marketing Strategy

Local Marketing Strategy

The company has to focus on the marketing mix. Marketing mix means the 4Ps of marketing. Our company is going to follow the marketing strategy considering these mixes-

Branding
A brand is a name, term, sign symbol or design or combination of them, identified to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors.

An Overview of Branding Decision

Business Plan of Wood Land

Branding Decision

1. Brand 2. No Brand

Brand Sponsor Decision

1. Manufacturer Band 2. Distributor Brand 3. Licensed Brand

Brand Name Decision

1. Individual Names 2. Blanket Family Names 3. Separate Family Names 4. Company Individual Names

Brand Strategy Decision

1. 2. 3. 4. 5.

Line Extensions Brand Extensions Multibrand Cobrands Newbrands

Brand Repositioning

1. Repositioning 2. No Repositioning

The branding decision for our Wood Land will be: Branding Decision: Brand Brand Sponsor Decision: Distributor Brand Brand Name Decision: Individual Names Brand Strategy Decision: New Brands Brand Repositioning: No Repositioning

Deciding

on Promotion Mix: There are four factors which should be considered to decide the promotion mix: Type of product/ Market, Push and pull strategy, Buyer Readiness stage, Product life cycle.

1. Type of product- our products are consumer products and require mass advertising and personal selling to encourage buyers to buy our products. 2. Push and pull strategy- there are two types of promotion mix strategiespush promotion and pull promotion.

Business Plan of Wood Land

As a marketer of Wood Land initially we will follow mostly Push strategy and little bit Pull Strategy that is we will move to the retailers with our catalogue and services and also spend a lot on promotional activities to build up consumer demand. If the strategy is successful, consumers will ask for our products to our retailer then retailer will ask us for the products. Demand Demand

Wood Land

Retailers

Consumer s

Marketing activities (advertising, personal selling)

3. Buyer Readiness stage- in the buyer readiness stage our products are in the awareness stage because our products are totally new and need to be awarded. 4. Product life cycle- in the product life cycle our product lies in the introduction stage since our products are launched for the first time in Bangladesh.

Product Life Cycle:

Sales and Profits Profi ts

Sal es

Product Developme nt Losses/ Investments Introduction Growth Maturity

Time Decline

Since our products are new for Bangladeshi market so we can say the product is in the introduction stage. As we are the first to introduce such products in the market, there is a possibility of low sales, negative or low profit and high per unit cost in this stage. And also the promotional and other expenditure is at the highest ratio to sales because of the need toInform the potential customers, Introduce product trial, secure distribution in retail outlets.

Business Plan of Wood Land

Marketing objective: Since, we are in the very first stage of the life cycle so our marketing objective is to create product awareness through promotional activities. Product: Despite all of the products are available in the current market, we have the Pioneer Advantage in this warehouse based business. To be the first in this market can be highly rewarding if we can create positive influence to the customer mind toward our product. And we also are planning to introduce more future product for the market coverage strategy. Price: Despite all of the distribution & promotion cost, the price of our product have to be economic. We will set up our products price by using cost plus formula to cover up the expenditure. Distribution: We have preferred selective distribution which refers to few and choosy outlets. We will hire a corner of Agora as our retailer. Since we are in the introduction stage so the distribution cost will be high. But after a successful one-year operation we planned to open and increase our own distribution outlets in order to grab more market share. Promotion: As our products are new for Bangladeshi market so we have to create and build product awareness among early adopters. For creating the product awareness we will use both print and web site for advertisement.

Bases for segmentation:

We have segmented the market for our products by the component of market segmentation, which are-

Geographic segmentation: Under geographic segmentation we have segmented the market for our products according to city basis. Initially we have only focused on the market of Dhaka city (Panthapath, Gulshan,

Business Plan of Wood Land Dhanmondi, Mogbazar, Mirpur), but after the successful first year of operation, we planned to expand our market into the port city Chittagong. Demographic segmentation: Under demographic segmentation, we have segmented the market according to income & occupation. Income: we have segmented our products for those who have reasonably high income and moderate income.

Psychographic segmentation: Under psychographic segmentation we have segmented our product according to the social class & life style of the target group. Social class: it refers to the class division of the society and we have segmented on the basis of those people who belonged to the upper and upper middle class whose income is reasonably high.

Behavioral segmentation: Under the behavioral segmentation, the segmented component is benefit. Our product has different features. They are of different quality and service pattern. Benefits: Such segmentation refers to the benefits of the products that a person looks in it. Wood Land is such a brand, which gives the person the room to be proud of their purchase. The benefits that are provided by our products are safety, user friendly, exclusive features, durability, comfort & pleasure.

Government Intervention on Pricing

Government intervention is mainly for the industrial product. It is not very much high for consumer products and that are friendly to the environment. Until or unless the products are harmful to the society and the environment the government does not intervene.

Advertising & Promotion

The most important thing for any business and for a new company this issue is a matter of headache. As it is a new company, so it is very important to select the best promotional tools for the company. As our product concept is simply new to the customer, so the company has to choose more specific and maximum understandable promotional activities for our product. Our company has already decided some promotional activities Company will give advertisement on newspaper thus the customer could easily identify about our product feature. Another reason for giving

Business Plan of Wood Land advertisement on newspaper is, most of the people in our country read newspaper. Company will publish leaflet describing the product feature and it will be distributed in the targeted area. Company will publish a catalogue which will contain all our attractive and lucrative design. These catalogues will go to the retailers, private offices and large customers. Company will design a Web Site that will contain all our design, contact address, related information.

Promotional Cost (Approximately)

Expenses Details Advertisement on newspaper Publishing Leaflet Catalogue Web Site Design Total Amount (Taka) 75,000 5,000 10,000 10,000 100,000

Global Marketing Strategy

Wood Land is going to target the consumer as well as business and Government market. Moreover Wood Land will come up with all new design which will definitely be quite attractive to the stylish foreign people. Cultural and language barriers, political issues and variations in religious beliefs, societal norms, and business negotiation styles impact how business should be conducted with international counterparts. Two steps can prepare an organization for an overseas effort. First, an international marketing plan must be developed, and second, the organization must determine how it will enter the new market.

Business Plan of Wood Land As Wood Land will target also the business market, in that case it will develop customer leads with attractive sales proposal, good quality products, low price, due time delivery and most important good relationship with parties. Wood Land will follow the Geocentric strategy that means Global marketing strategy for doing business in abroad. Here they will focus on global strategy because they see whole world as a one market Promotion Strategies Promotion is one of the most imperative functions of getting the product more profitable in the business market. It is the mix of different elements through which organization achieve promotional objectives. In terms of global promotion strategies, Wood Land first analyzes-like identify target customer according to their product then conduct a brief analysis how they reach their target customer. By analyzing the environment of target market we will chose following methods for marketing our product. These are -----

Sales promotion E- marketing/telemarketing Public relation

Sales promotion Sales promotion is a short-term incentive to encourage the purchase or sale of a product. The sales promotion of Wood Land is very common among it region of operation. This promotion is normally given on the amount of sales and seasonally. E-marketing/telemarketing E-marketing or electronic marketing refers to the application of marketing principles and techniques via electronic media and more specifically the Internet. It includes both direct response marketing and indirect marketing elements and uses a range of technologies to help connect businesses to their customers. Wood Land has its own web page through which customer can order with the catalogs including the suggestions of different types of design combination. Moreover it also provides advice for different types of interior design. Public Relation A Public relation is all about building a good relationship with the customer by obtaining favorable publicity and building a corporate image. Public relations activities include helping the public to understand the company and what it offers

Business Plan of Wood Land to customer. It will help us to manage our outside communication of our organization to create and maintain a positive image. Often, public relations are conducted through printing media that is newspapers and magazines. For example- Wood Land can give brief description about the trend of modern design in different news media and publish articles.

Managing Global Advertising Wood Land must do more than good quality products-they must inform the customers about their product benefits and carefully positioned in foreign customer minds. So, relative to other products/industries, advertising is very important to our product. In advertising we can place our product where people can easily watch what is our product, how its works, its usage, its advantage and benefit. By advertising we can easily differentiate our product from our competitors. Here, in our selected country/region advertising is must needed, because the market is very much fashioned oriented. So, here to stay alive in the market we will apply different sort of advertising which will include some traditional advertising methods and some modern advertising methods. There are different types of media are available in our selected country, but among all of them the best and most effective media are as follows: Electronic media Print media Bill board

Business Plan of Wood Land

Research & Development

Research and development (R & D) is very crucial to start up any new business. There are many furniture companies in the market with their own brand name, entity and design. This is necessary due to continuous change in the market as well as the changing preference of customers needs and wants. If we want to create a place in the market, then we have to innovative in idea, planning and strategy. Otherwise we will not be able to defeat them. So a strong research and development team are needed to find out are competitive strategy to sustain in the market.

Business Plan of Wood Land For this purpose, we have given a proposal for conducting research and the hired some potential researcher. At first they have been clarified our subject of business and based on that they start conducting their research.

They surveyed a portion of all type of people around Dhaka, Chittagong city including office-goers, students, housewives and other professional. They made different types of questions by clarifying and reflecting the taste, style, design of different customers. Based on that data, they have gone through many processes of research, followed many research techniques and analyzed those data very thoroughly to interpret the result precisely. At last they came to the result and based on that result we will take decision to operate our business. They have also analyzed the market carefully to acquire the knowledge of market demand regarding this business. They will also try to find out the innovative, lucrative, unique design of furniture which will attract the customers and increase the demand of our products. They analyzed the industry of financial institutions to get a clear idea about the industry. At the same time, they analyzed the market to forecast the future prospect of this business. Government regulation on any business is very consequential, because every business has to follow the rules and regulations and to maintain certain criteria to set up a business. Our R&D team has found the feasibility of our business according to government criteria. The impact of economy for the growth of the company has also been analyzed. The team also research for existing and potential competitors and mentioned some strategies to bid against those competitors. All these crucial analysis was done by the R&D team to assure for the successful implementation of our project. Research and development team will give us the guideline for financial plan and marketing plan of our business. Our R&D team also assists us to make our business strategy which could bring success in our business.

Challenges & Contingency Plan

If we want to operate our business competently, we have to face several challenges. Therefore, we have decided to find out the challenges which we may face in running the business and at the same time we have identified the contingency plan for these approximated challenges:

Challenge: Why suppliers should supply it through Wood Land?

Business Plan of Wood Land

Contingency Plan:
Now days suppliers are selling their product direct to the retailers and people are good to have their own brand. But if we can maintain a close relationship with the suppliers to reduce the per unit cost of product and giving a higher profit then the existing retailers, then these problems can be resolved. Now a question arises, who we can reduce per unit cost of suppliers? If we can create a high demand of our products to the customers then suppliers will get higher order which will help him to utilize his machines and maintain an economic of scale. By manufacturing large quantity product suppliers can reduce his variable cost as well as the total cost. Simultaneously we are providing the suppliers our design which will help him to reduce the design cost.

Challenge: Why retailers should buy on cash through Wood Land?

Contingency Plan:
Now days manufacturers are supplying products to retailers on credit and get the money long after the selling. So, retailers will not want buy products from Wood Land on cash. But if we can innovate lucrative, exclusive and unique design at an economic price that will generate a good impression on customers, then the demand of our product will be increased. Due to this high demand of product the unit price of our product will be less than the direct manufacturers. As the retailers can earn more profit by selling our product, the retailers will eager to take our product on cash. Again we can create a segment on the basis of area. As initially our main focus will be in Dhaka, so we can sell percentage of our product on credit in Dhaka and in other area such as Chittagong, Khulna, Rajshahi on cash by showing the transportation cost. After creating a huge demand of our products in Dhaka and capturing a large percentage of market share of Dhaka we can stop selling our products on credit.

Challenge:

Dissatisfaction by Customer occur due to comparison between our products and others products

Contingency Plan:
Unforeseeable problems will be mitigated through the careful management of customer expectations. We will do our best to manage customer expectations and work with them to provide good service. We will take feedback from them, so that we can continue to improve our service.

Business Plan of Wood Land

Challenge:
term business.

Arrival of Competitors may be a cause of hassle in long

Contingency Plan:
We will keep frequent contracts with our customers that will ensure the superiority of our service. Again we will try to maintain a good relationship between our suppliers and retailers every time, so that new company cannot create any trouble in our business. We are planning to maintain the rule very carefully so that we can ensure the best service to our customers. We also have to be very cautious in choosing the liaison. Without these challenges we have to face the other challenges such as Inflation, Import Dependency and Political Instability. Inflation is top red flag for Furniture Bangladesh. This should be carefully addressed. At the second stage, in case of import dependency, foreign exchange risk is also quite high. On the other hand, political instability is also another crucial risk area which must be carefully addressed.

Confidentiality & Recognition of Risks

Business Plan of Wood Land

Confidentiality Clause
This information included in this business plan is strictly confidential and is supplied on the understanding that it will not be disclosed to third parties without the written consent of Uttam Kumar Nandi, Md. Aminul Quyyum, Md. Sabbir Ul Alam, Md. Dewan Saifuddin Ahammed and Mahjabin Afrose Archi.

Recognition of Risk
This business plan represents management's best estimate of the future potential of our business. It should be recognized that not all major risks can be predicted or avoided and few business plans are free of errors of omission or commission. Therefore investors should be aware that this business has inherent risks that should be evaluated prior to any investment.

Summary & Recommendations

The project shows very good current ratio and operating ratio. Moreover, we see as the investors are well experienced, they are able to mitigate the risks associated with the project. Market analysis

Business Plan of Wood Land shows that there is still huge market which is untapped and this market is rapidly growing. Considering the innovative ideas to be used here with comparatively less investment, the project is viable and should be accepted. But at the same time, Wood Land must keep an eye on brand marketing to attain success quickly. Moreover there are huge numbers of human resources in our

country. If their potential can be utilized in a constructive manner than the above stated profit margin is not that hard to achieve.

Appendix
Web sites:
i. www.entrepreneur.com

Business Plan of Wood Land ii. www.businessplanarchive.org iii. www.businessballs.com iv. www.bpaln.com v. www.myownbusiness.org vi. www.affinitycapitalmanagement.com vii. www.bizplans.co.uk viii. http://www.zeromillion.com/ Books: i. Entrepreneurship by Robert D. Hisrich and Michael P. Peters ii. GO IT ALONE! by Bruce Judson