Business Plan On Eavesdropper

Business plan for Eavesdropper: Frequency controller headphones
Business Plan for:

Eavesdropper
Hear According to Your Ear. F-306

GROUP 6
Entrepreneurship and
Project Development
Business Plan for Eavesdropper: Frequency Controller Headphones
A Term Paper on, Business Plan for Eavesdropper Headphones
Submitted To
Md Imran Hossain
Assistant Professor
Dept of Finance
University of Dhaka
Submitted by:
Name ID Remarks
TasfiaTasneem Ahmed 21-028
NusratAnjum 21-097
Sheikh Ishtaque 21-157
Md.Ashiqul Islam 21-166
Muhammad SaifulAlam 21-201
i
7 December, 2017
Mr Imran Hossain
Assistant Professor
Department of Finance
University of Dhaka
Subject: Letter of Transmittal for Term-Paper
Honorable Sir,
We are pleased to submit the term-paper that you asked for as a part of our BBA course. We are also
gratified that you gave us the authorization to make a business plan for our innovated product. We
tried our best to work carefully and sincerely to make the report informative and analytical.
The study conducted enhanced our knowledge of entrepreneurship. This report has given us an
exceptional experience. It might have immense uses in the future endeavors of our financial career as
finance has a crucial role in driving new ventures to the top. We sincerely hope that it would be able
to fulfill your expectations.
We have put our sincere effort to give this report a presentable shape and make it as precise as
possible. We cordially thank you for providing us with this unique opportunity.
Sincerely yours,
TasfiaTasneem Ahmed
On behalf or Group 6
Section: A, 21st Batch,
3rd Year, 2ndSemester,
Department of Finance
University of Dhaka
ii
Acknowledgement
At the very beginning we want to thank Almighty Allah who makes us enable with the
completion of the report and fulfill our course requirement.
Secondly, we show our deepest thanks to our course teacher, Md Imran Hossain, Assistant
Professor, Department of Finance, University of Dhaka for his benevolent suggestions about the
structure and strategies which helped us in every part of the report and also for the case based
approach in conducting the course which exposed us to various pragmatic implications of
entrepreneurship.
Thirdly, we express our heartiest thanks to MsTazrina Farah who provided us with a model of
business report in first year.
In course of writing this report, we have so far given our best effort to prepare and represent the
report according to instruction of our honorable supervisor. We hope our endeavor will be
beneficial to the audience and urge for exonerate eye for any mistake or error found in the report.
iii
Executive Summary
Eavesdropper Private Limited Company is created with the purpose of manufacturing frequency
controller headphones. The idea of the product is developed by its founders and the business will
open its first office in the commercial center of Uttara.
This business plan is commissioned to examine, explain and evaluate Eavesdropper as a whole
enterprise in the means of these key factors in establishing a small to medium enterprise. The
plan consists of ten sections, in which the whole business model has been explained.
Eavesdropper is a headphone with a special feature of frequency controller that adjusts the sound
of surroundings.It can also focus on particular frequencies so one can concentrate on a particular
sound. It has conventional headphone features too.
It has been said by the industry insiders that one-fourth of the current handset market valuing
BDT 10,000 core consist with the accessories market.With this product, we will try to aim for a
position in this market. Porters five forces model and PESTEL analysis have signaled that this
industry is quite attractive.
The venture will operate as a private limited company which will form various partnerships and
strategic alliance for attaining its goal.
After identifying the market segments,job holders, students and group with hearing problems are
decided as the target market based on buyers needs and spending behavior.
The competitor analysis says that there is currently no competitor in the market but global brands
can come to grasp a market share. Regarding this, the competitive analysis grid shows where this
product has an advantage of this market full of prospects.
The project breaks even in the third year.
The product will be in three different forms with different price tiers ranging from 1000-2000 tk.
There will be two short distribution channels and the promotion will be through TV, billboard
and online ads.
The projected financial figures are quite favorable and the company has high potential to prove it
as a lucrative venture.
iv
Table of Content
Contents
Eavesdropper................................................................................................................................... 2
Eavesdroppers Features: ............................................................................................................ 4
Industry Analysis ............................................................................................................................ 5
Our industry at a glance .............................................................................................................. 5
Core competitors ......................................................................................................................... 6
Industry trends ............................................................................................................................ 7
Industry attractiveness: ............................................................................................................... 8
Company description ...................................................................................................................... 9
Company History: ....................................................................................................................... 9
Mission Statement....................................................................................................................... 9
Products and Services ................................................................................................................. 9
Legal Status and Ownership ....................................................................................................... 9
Key Partnerships ......................................................................................................................... 9
Market Analysis ............................................................................................................................ 10
Market Segmentation: ............................................................................................................... 10
Target Market: .......................................................................................................................... 10
Target market Segment Strategy and Buyer Behavior ............................................................. 11
Competitor Analysis: ................................................................................................................ 11
Market Size and Growth: .......................................................................................................... 12
Market Share: ............................................................................................................................ 12
Economics of the business ............................................................................................................ 13
Marketing Plan .............................................................................................................................. 15
Overall Strategy: ....................................................................................................................... 15
Positioning: ............................................................................................................................... 15
Price .......................................................................................................................................... 15
Promotions ................................................................................................................................ 16
Market Penetration .................................................................................................................... 16
Unique Marketing Strategy ....................................................................................................... 16

Suitability of the Strategy ......................................................................................................... 17
Contingency Plan ...................................................................................................................... 17
Marketing Budget ..................................................................................................................... 17
Design and Development Plan ...................................................................................................... 19
Development Status and Tasks ................................................................................................. 19
Challenges and Risks ................................................................................................................ 19
Proprietary Issues ...................................................................................................................... 19
Operations plan ............................................................................................................................. 20
General Approach to Operations .............................................................................................. 20
Business Location ..................................................................................................................... 20
Facilities and Equipment........................................................................................................... 20
Management team and Company structure................................................................................... 21
Company structure .................................................................................................................... 21
Board of directors ..................................................................................................................... 22
Board of advisers ...................................................................................................................... 23
Management Team: .................................................................................................................. 23
Overall Schedule ........................................................................................................................... 24
Financial projections ..................................................................................................................... 25
Business Ratios: ........................................................................................................................ 25
Quick ratios: .............................................................................................................................. 25
Debt Ratio: ................................................................................................................................ 26
Profit Margin Ratios (over the projected years): ...................................................................... 26
Sources and Uses of the statements: ......................................................................................... 27
Forecasts used to prepare Pro Forma financial statements for Eavesdropper: ......................... 29
Conclusion .................................................................................................................................... 33
1
Eavesdropper
Are the sounds of busy city traffic irritating you? Are you frustrated when you cannot hear
teachers lecture in a large classroom because your classmates are making noise? Can you
concentrate in work when loud fireworks, sound systems, seminars/speeches bothering your
hearing? These situations will be much worse if you have any hearing problem. So, what can you
do to against these Unwanted Sounds discomforting you?
Eavesdropper is the solution for you. Eavesdropper is a headphone with a special feature of
frequency controller that adjusts the sound of your surroundings (ranging faint sounds like
birdsongs and rustling leaves to louder sounds like music, yelling, traffic horns, and industrial
noises) to your tolerable level thus protecting your hearing power. It can also focus on particular
frequencies so you can concentrate on a particular sound you want to hear. It is also helpful to
the people having hearing problem. Along with that it provides all the features that traditional
headphones provide.
The human hearing range is a description of the pitches and loudness levels of a sound a person
can hear before feeling discomfort. This human hearing range is called the audible range. Pitch
of the sound is measured in Hertz (Hz) and Loudness in Decibels (dB). For a person with normal
hearing pitch range is 20Hz to 20000Hz. As far as the loudness is concerned, it is 0dB to 85dB.
Any sound exceeding 85dB can be dangerous for hearing.
Human Hearing Factors Audible Range Eavesdroppers Sensitive

Range
Pitch 20-20000Hz 2000-5000Hz
Loudness 0-85dB >75 dB
2
3
Eavesdroppers Features:
It controls the frequency of the sound and users can keep it between 2000 to 5000 Hz which the
most sensitive range for human hearing. It keeps the loudness under 75 dB without causing any
harm to our hearing. It has the special features of changing frequency which allows users to
concentrate on a particular sound keeping all other sounds in the surroundings aside. It performs
in the same way FM Radio does. Along with that, users can hear music, talk with others, and
enjoy radio by plugging in the phone.
Tolerable and sensitive audible range.

Focus on particular sound,
Special frequency range for people with hearing problem.
Traditional Headphone Features:
o Phone Call Receiving
o Music
o FM radio
4
Industry Analysis
A businesses profitability and growth rate is very much dependent on the posture of the
belonging industry. For this reason, in order to estimate how much profit we could generate from
our business operations, what could be our future projections, how far we could continue our
business and how much we would be successful in attaining our long-term goal, industry
analysis is a must. Along with these benefits, this analysis would help us to assess the
competition we are going to face in the industry.
Our industry at a glance:Our industry basically generates from the mobile market
industry named as Mobile accessories industry. It has been said by the industry insiders that one-
fourth of the current handset market valuing BDT 10,000 core consist with the accessories
market. Alliedmarketresearch.com recently published journal in with it predicted that the
accessories market is expected to reach $107.3 billion by 2022. In our neighbor country India the
accessories market reached to $1 billion. According to The Daily Star (published August 2,
2017), in our country the mobile accessories market reached about BDT 2,500 crore with the
growth rate of 25%. Thus, for the upcoming few years, the status of this accessories industry
could be looked as follows:
Again, when 4G will reach in our country, it is expected that the growth rate would be minimum 30-40
percent, according to The Daily Star.
5
Our Product Eavesdropper is very much dependent on the fluctuations of the mobile market. As
a sub-industry of mobile market, the products that comprise our industry are the following
accessories:
Core competitors:So as our industry is composed of huge variety of products, in order to

better understand our core competitors and their strategies, we have basically divided our
competitors into three segments considering our product Eavesdropper with the existing other
headphone providers:
Local Brands: Our local competitors are mainly the national mobile phone companies who are
selling mobile phones and mobile accessories in the market. Thus the local competitors we care
about include Symphony, Walton, We etc.
Global Brands: Along with the consideration of our local mobile phone and mobile accessories
providers, global brands like Apple, Samsung, Xiaomi, Huawei also provides headphones in the
market for which reason we consider them as our major competitors.
6
Chinese Products: In our country, Chinese products have a great influence as these products are
relatively cheap and available. Many Chinese companies are supplying headphones along with
other mobile accessories to the market. So our consideration also includes them as core
competitors.
Industry trends:In order to specify the industry attractiveness, we have considers the basic
industry trends according to PESTLE analysis model which has been described as follows:
Political: one of the basic force on which our business could depend includes the political
element in the accessories industry. We have considered its market environment strictly by
paying attention to the current legislation regarding Tax, VAT and wages to be paid. These
factors seem reasonable to us.
Economic: One of the most important elements that we have considered is the economic
environment of accessories market considering the GDP growth rate, inflation and
unemployment rate, interest and exchange rate which would benefit our company understand the
economic status. We have considered all the elements and they seem to in favour to our industry.
Social: Another important element is the social trend which includes demographic and cultural
factors, lifestyle and fashion etc. which could play a great impact on the success of our business.
7
Technological: we have also considered the technological segment in the industry. This segment
is the most important segment we have considered in our industry analysis as technological
impacts have direct significant influence on our profitability and business success.
Legal: we have also considered the legal rules and restrictions imposed by the Govt. Republic of
Bangladesh and found them in favor of us.
Environmental: Different environmental issues such as weather, climatic change, global

warming has also been considered and all the rules and regulations employed by environment
protection authority and the government should be followed.
Porters Five forces Model
Industry attractiveness:Along with the discretion of industry trend, we have also

considered the industry attractiveness from the five perspectives which helped us to project the
profitability and success of the business in future. They have been described as follows:
Substitute products: As our product Eavesdropper has some core feature for which reason it has
gained a unique characteristics, we think initially we will not have any direct substitute product
against our product. But the existing headphone producers are the prime substitutes if we
subtract our core feature. Therefore, the existing products of local, global and Chinese brands
could be act as the substitute product providers.
Possibility of market entry for new companies: Because of our core feature, it might be hard
for any new companies to come up and start competition with us. But imitation is possible. As
we would take necessary steps to legally trademark, patent and copyright our products, it would
be hard for new companies to directly compete with us.
Competition with the existing companies: the major burden for our profitability and growth
would be the existing competitors prevailing in the industry. However, we are hopeful to gain a
strong position with our core unique feature in the industry.
Our Customers and suppliers bargaining power: we would basically collect the material to
produce headphones from abroad rather than locally producing them. So bargaining power
would be high. So we have decided to keep relationship with a number of few suppliers to get
the materials at a comfort price. In addition, we would sell our product with fixed price. We
believe for our unique feature, we could build up strong brand value and reduce bargaining
power of the customers.
8
Company description
Company History:Eavesdropper private limited Company is a new company that will

provide high quality technical and headphones to its customers. Itwill be owned and operated by
its six founder directors.
Mission Statement: The mission of the company is to achieve the highest standard in the
manufacturing of frequency controller headphones to inspire moments of serenity and focus.
The tagline is: Hear according to your Ear
Products and Services: Initially, the company will produce eavesdropper and if it
continues to grow, it will expand into other lines of headphones and electronic devices.
Legal Status and Ownership: The business is a private limited company established in a
office in Uttara.
Key Partnerships: The key partnerships include some agreements with key smartphone
sellers of the market.
Also, there are supplier partnerships including some contracts with Chinese and Japanese
suppliers of parts needed to manufacture headphones.
This will give the company the flexibility it needs to successfully secure and complete projects
with varying elements. By using existing contracts and joint ventures with other manufacturing
firms, it will be in a position to accomplish its goals.
9
Market Analysis
Market Segmentation:We segmented our market based on the professions and need of our
buyers because some class of people are more vulnerable to sound problem than others. We also
considered the hearing exposure of the buyers. Based on our judgments we divide our market in
the following segments:
Middle-Upper Class Job Holders: This segment actually targets the people who travel to
the job places and are exposed to heavy sound pollution in traffic and job places.
Students: This category consists of College and University students. Like the job holders
many of them have to travel through heavy traffic regularly to attend classes.
Health Conscious: People who are very much concerned about sound pollution and its
consequence on health, are usually prone to environmental friendly products and services
like eavesdropper.
People with Hearing Problem: People who have hearing problem and use different types
of hearing aids, eavesdropper is a multifunctioning and cheaper substitute of those
hearing machines.
General Segment: We keep all other people excluding the above four categories in the
general category.
Target Market:As for target market we particularly target the job holders, students and
group with hearing problems. We will design and distribute the product specially keeping the
needs of these three segments in mind.
The main reasons of selecting these segments are:
They are exposed to sound problem to a great extent.
They have the buying power of our product.
As our product can be used by any one in general so our market is much wider than the selected
segments.
10
Target market Segment Strategy and Buyer Behavior: Our target market
strategy is based on buyers needs and spending behavior. Job holders and people with hearing
problems have the ability and will to spend more for the needs than the students. The people will
demand highest quality loudness and frequency control if they have any hearing problem. On the
other hand Students demand headphones that can multitask and provide high quality sound
system for music and frequency focus. So we along with general product we have:
Eavesdropper Pro
Multi-Eavesdropper
Multi-eavesdropper is for students need and Eavesdropper pro is specially designed for people
having hearing problem.
Competitor Analysis: There is no company particularly producing headphones. But there

are many companies producing headphones along with electronic gadgets like Symphony,
Walton. There are many global products from renowned brand like Samsung, Xaomi, Iphone,
Huwei. Many Chinese headphones are also available at low cost.
But Eavesdropper has some unique qualities that gives us competitive advantages in many areas.
Competitive Analysis Grid:
Name Eavesdropper Local Brands Global Brands Chinese

Products
Feature Advantage Disadvantage Disadvantage Disadvantage
Quality Advantage Disadvantage Even Disadvantage
Price Disadvantage Even Disadvantage Advantage
Eco Friendliness Advantage Disadvantage Disadvantage Disadvantage
Management Even Advantage Advantage Disadvantage
After-sale Advantage Advantage Advantage Disadvantage

Support
Distribution Even Advantage Advantage Disadvantage

Channel
Overall Advantage Even Advantage Disadvantage
11
Market Size and Growth: Market size of headphones can be generated from market size
of smartphones. According to BTRC 67.1 million people actively use mobile phones and 34% of
which are smartphones requiring headsets.
Market has a growth of 20.3% every year.
Market Share:Symphony grabs the highest market share. Other key competitors are
Samsungs and Waltons headphones.
Eavesdropper, with its unique features and qualities aims at 10% market shares within 2 years
and 18% at the end of year 3.
Estimates of Annual Sales: Eavesdroppers estimate of annual sales is based on its market share
target in the upcoming years. Headphones sales increase at 20.3% annually. According to
current market capacity it will be 4.34 million units approximately. Based on this estimation our
expected annual sales for upcoming 3 years will be:
Year 1 2 3
Units 300000 361000 435000
12
Economics of the business
We are concerned about the economics issues and problems related to our organization. Because
we know understanding the economics problems and projections will help us how far we could
go and what would be our status in the industry in the future. Thats why we do care about the
economic issues that will influence our performance.
Revenue drivers and profit margins:
We have identified four key drivers which can influence our profitability. They have been shown
as follows:
Price
Variable costs
Fixed costs
Sales Volume
1. Profit will increase if we increase our price.
2. Profit will increase if we could decrease variable costs
3. Profit will increase if we could decrease fixed costs
4. Profit will increase if we could increase sales volume
Fixed and variable costs:
As fixed costs indicate these costs that do not vary over the period that is, it remain unchanged,
we assume our fixed cost will include Property, plant and equipment, machineries that will
require to keep our production, lease and loan payment, management salaries etc.
Again, as variable cost indicates the costs that vary over time, we consider the costs would be
Cost of goods sold, utilities bill, unit production costs, packaging, labor costs etc.
Break-even-Point-Analysis:
From our analysis, it has come out that in first projected year, we may face loss and the
probability rate of facing is loss is quite high. So, in the 2nd projected year we have to meet break
point at 506,082,945 tk. But the projected sales will be less than the projected break-even. And in
our third project year, our break-even point at 508,630,748 which will lower than our projected
sales.
13
Projected- Projected- Projected-

1st year 2nd year 3rd year
Fixed costs 239,162,737 239,254,737 239,254,737
SPPU 1200 1500 2000
VCPU 319.0919875 319.0919875 319.0919875
CMR 0.73409001 0.787272008 0.840454006
Target profit (loss) 159,170,199.39 188,226,012.96
BEP(Tk) 506,082,945 508,630,748
Graphical presentation of BEP:
Break-Even-Point
600000000
500000000
400000000
300000000
23239,162,737
200000000
100000000
0
0 3,00,000 361,000 4,00,000
14
Marketing Plan
Overall Strategy:
Positioning:The unique features of Eavesdropper differentiate our product from other
available headphones in the market.
Value Proposition of Eavesdropper is Hear According to Your Ear.
Product: Eavesdropper brings three unique products in the market.
Model Features
Eavesdropper Frequency Adjust
Frequency Focus
Multi-Eavesdropper Frequency Adjust
Frequency Focus
Bluetooth
Music & FM
Fully Smartphone Functioning

Eavesdropper Aid Pro Frequency Adjust
Frequency Focus
Special Frequency Range
Smartphone Functioning
Price:Price differs for each models of Eavesdropper. Price is within the spending limit of the
targeted segment of market.
Model Price (Tk.)
Eavesdropper 1000
Multi-Eavesdropper 1200
Eavesdropper Aid Pro 2000
15
Distribution Channels:We will distribute our product through two short distribution
channels. The flowcharts below show our distribution channel:
Promotions: To inform the market about the arrival of the brand new product we will start
the promotional campaign by a chain of ads. We will put more weight in social marketing. Our
means of promotion will be:
TV ads, Radio Broadcasting

Billboards and Hoardings in noticeable positions
Website and Online Promotion (Facebook, Instagram, Twitter)
We will also participate in Trade Fares and Tech Fares to show the unique quality of our
products.
Market Penetration:
Unique Marketing Strategy: To attract our target customers and get them known to the
products quality and feature, Use or Return strategy will be used. We will also organize
campaign to distribute free Eavesdropper Aid Pro to some people having hearing problem for
social promotion. Our online and TV ads will also show the product as a Solution of a Social
Problem.
16
Suitability of the Strategy: As our product is a solution to social problem (sound

Pollution), social marketing suits our way of business. And even the viewers like a product when
they see it as a solution of their daily problem.
Eavesdropper has strength in its features that gives us the competitive advantages. And the kind
of a product eavesdropper is, very much new and innovative to the people.
Contingency Plan: We will go directly to the target customers and held promotional
campaign to show them practical benefits of Eavesdropper in case our initial promotional
activities fail to raise expected result.
Marketing Budget: The table below shows the estimated budget for promotional activities
for 1 month and 3 month time frame:
Total Marketing Budget

ATL Marketing Budget
Details Ad Rate No. Of Total Total
1 2 Channels/Newsp (1 Month) (3 Months)
Progr News aper
am
Advertisement 1 (36,000 + 6 648,000 1,944,000
(60 Sec) 72,000)
Advertisement 2 (36,000 + 6 648,000 1,944,000
(60 Sec) 72,000)
Advertisement 3 (24,000 + 6 432,000 1,296,000
(40 Sec) 48,000)
Newspaper (13,500 + 4 112,000 336,000
Adverts 14,500)
G&R and 70% in G&R & 50,000 150,0000
Google AdSense 30% in Google
AdSense
Total 1,890,000 5,670,000
BTL Campaign budget (Contingency)
Promotion Cost No. Of Divisions Total Total
(1 Month) (3 Months)
17
Divisional 200,000 8 1,600,000 4,800,000

Promotions
Promotion Cost No. Of Universities Total Total
Gathering Promotions 20,000 20 400,000 1,200,000
Cost per Month No. Of Agents Total Total
Return Plus Agents 25,000 10 250,000 750,000
Development/Design Maintenance Total Total
(One-Time Cost) (Per Month) (1 Month) (First 3 Months)
Social Media 50,000 100,00 150,000 350,000
Promotion 0
SUB TOTAL 4,240,000 12,620,000
Ad rate from: http://www.atnbangla.tv/tv-ad-rate/

Newspaper Ad: http://www.thedailystar.net/advertisement
18
Design and Development Plan
Development Status and Tasks: The product has been developed by a leadingChinese
design firm. They have a strong reputation in electronics design. The product has been tested by
various experts and sound engineers who have given positive feedback about its effectiveness in
controlling frequency.
The virtual prototype will be produced in our factory situated in Savar. Mainly assembling will
be done here.
In different stages, the components will be outsourced and assembled into finished product.
Challenges and Risks: The challenge in developing the product was whether it will really
be able to identify the aimed sound and it may take a little time to focus the frequency.
But it has been proved to accomplish its uses successfully. Preliminary product review and final
product review have been done by various firms.
Proprietary Issues: As this name and idea is quite unique, the company aims to go for a
trademark and brand name after achieving break even and having enough surplus money.
19
Operations plan
General Approach to Operations: The business will be run by at office
Business Location: Uttara is a major hub in IT sector companies and our office situated
there will be fruitful in reaching its stakeholders. The favorable office location can serve as a
cost advantage.
The production will take place in the factory at Savar.
Facilities and Equipment: The firms key facilities and equipment will be purchased
from a Japanese corporation.Some equipment will be leased also.
The outsourced raw materials will be brought by ship at Mongla port.
20
Management team and Company structure
Company structure: The Company will be arranged into five functional areas:
Production and Operations: The operations department is in charge of making our headphones.
It has to produce detailed designs for the products and plan for the productions of the required
quantities. It also has to purchase the raw materials. It must manufacture the products, test and
ship them.As a manufacturing company, the operations department is the heart of this business.
Marketing and Sales:We will put more of an emphasis on sales until we have sufficient capital
and staff to elevate the marketing function. This department will define roles that reflect the
strengths of our products and assign responsibilities for achieving the sales performance required
by the company. The marketing strategy will be made by this department so that they can set
achievable targets and take responsibility for meeting their objectives.
Accounts and Finance: This department will create budgets, analyze performance, and develop
strategy. It will record accounts payable and receivable, inventory, payroll, fixed assets and all
other financial elements. The department's accountants will review the records of each
department to determine the company's financial position and any changes required to run the
organization cost effectively.
HR and Customer Service:The human resources and customer service department will be
responsible for hiring employees and ensuring that they get the proper training to perform their
jobs. As Zenith will be a short scale company initially, Customer Services is merged with HR.
This department will provide service to customers during, after or before purchase.
IT support:Businesses today cannot survive without an IT department. This department will be

responsible for providing the infrastructure for automation. It will implement the governance for
the use of network and operating systems, and it will assist the operational units by providing
them the functionality they need. Other fumctionincludes, Applicationand company website
development and technical support.
21
Board of directors:
22
Board of advisers:
Management Team:The management team consists of 10 full-time employees including

five executive directors. Additional assistance is acquired on a part-time basis and/or through the
use of consultants, specifically in legal matters.
23
Overall Schedule
We are very excited with our innovative product idea. So we are hoping for opening our company just from the first day of 2018. Therefore, in
order to come up with the implementation of our business product idea, here is the time-line flow chart of how we could start our company
from the very beginning of industry analysis to the starting of production:
24
Financial projections
Business Ratios:
Ratios 2015 2016 1st year 2nd year 3rd year
Liquidity Current Ratio 1.45 1.12 1.10 0.97 0.91
Quick Ratio 0.45 0.12 0.10 (0.03) (0.09)
Overall
Debt Ratio 17.05% 16.27% 15.58% 19.90% 19.90%
financial
Stability Debt-Equity
Ratio 58.01% 33.35% 45.37% 41.48% 46.38%
Profit Margin
on Sales 50.41% 41.11% -0.04% 35.99% 36.06%
Gross Margin 64.00% 64.00% 64.00% 64.00% 64.00%
Operating
Profitability Margin 44.00% 44.00% 39.00% 39.00% 39.00%
Return on
Assets
(ROA) 15.56% 16.14% -0.02% 18.06% 20.45%
Return on
Equity (ROE) 36.31% 32.85% -0.04% 40.84% 48.77%
Quick ratios:
Here we can see that after the business is started, there will be a change in our businesss quick
ratios. It can be happened due to some strong reasons. We will start to sell more where
receivables will also be increasing. That is why; quick ratios will tend to decrease after a certain
periods.
0.5
0.4
0.3
0.2
0.1
0
2015 2016 Projected-1st year Projected-2nd year Projected-3rd year
-0.1
-0.2
25
Debt Ratio:
As we estimated debt-ratio, our results indicate that in our first three or few years, this debt ratio
will remain same which will be in tolerable situation. That means owners equity will dominate
over debts.
90
80
70
60
50
Debt-Ratio
40
Equity Ratio
30
20
10
0
2015 2016 Projected-1 Projected-2 Projected-3
Profit Margin Ratios (over the projected years):

In our projection we may face loss in our first year. Instead of being stable, our company will
move fast and that will help us to earn more profit in the coming projected years.
40.00%
35.99% 36.06%
35.00%
30.00%
25.00%
20.00%
15.00%
10.00%
5.00%
-0.04%
0.00%
Projected-1 Projected-2 Projected-3
-5.00%
26
Operating leverage:
Operating leverage is a measurement of the degree to which we have projected a combination of

fixed and variable costs. If it provides a high gross margin and fewer fixed costs and variable
costs.
The higher the degree of operating leverage, the greater the potential danger from forecasting
risk. However, businesses with high operating leverage are also more affected by poor corporate
decisions and other factors that may result in revenue decreases.
By estimating and forecasting the fixed costs, variable costs and revenues, our operating leverage
will be as follows:-

2015 2016 1st year 2nd year 3rd year
Revenue 264,506,900 317,408,280 360000000 442225000 522000000
Variable costs 95222484 114266981 129600000 159201000 187920000
Net income 95,222,484 114,266,981 129,600,000 159,201,000 187,920,000
Operating
Leverage 1.777777778 1.777777773 1.777777778 1.777777778 1.777777778
That means if our sales increase by 20%, then there will be an increase for operating leverage
177.78% or 1.7820% = 35.56% over the projected years.
Operating leverage on graph:
27
Sources and Uses of the statements:
Income Statements:
Units estimated on the basis of market analysis
Net sales
Per unit cost varies for drop brands
Purchase of mandatory elements which vary regarding to the

COGS units
Wages, raw materials purchase which is directly related to
the main product.
Balance Sheet:
Cash & cash equivalents Cash on hand, selling property, antique equipment
Account receivables Higher the sales, higher the receivables over the projected
years.
Property, plant & equipment For having greater value in the, PPE will be considered
importantly.
Long term & short-term loan, borrowing will be great
Financing: sources of our funding.
For bringing uniqueness, many well-known
companies will be eager to lend money.
A great sponsorship will be met.
Cash flow statement: Cash inflow and outflow from,

Operating activities,
Investing activities, many establish companies will surely
invest,
Financing activities
28
Forecasts used to prepare Pro Forma financial statements for

Eavesdropper:
Pro Forma Income Statements:
Net Sales
Historic Average sales increase 20%
2018 Sales Increase to 22%
2019 Increase to 22.5% as the result of brand awareness
2020 Increase to 22%
Cost of goods sold (COGS)
Historic Average of 36% of sales
2018 36% of sales
2019 36% of sales
2020
Selling and administrative expense
Historic Average 20% of sales the past years
2018 Increase 25% of sales due to the increase of sales
2019 Increase 25% of sales
2020 Increase 25%
Interest expense
Historic 8% of long-term debt
2018 It may increase to 8.5-9%
2019 Increase to 9%
2020 Increase to 9%
Pro Forma Balance Sheets:

Accounts receivable
Historic Accounts receivable went down 9 to 10%
2018 8% of sales
2019 8% of sales
Inventories
Historic Historical data shows that it fluctuated 5-6% last 4 years
2018 5% of sales
2019 5% of sales
Land, buildings and equipment
Historic 80,00,000 tk in equipment purchases and improvement in buildings
2018 Equipment will be purchased to improve the Eavesdropper
Accounts payable
Historic
2018 8% of sales
2019 9-10% of sales
Long-term debt
Historic 90,000 tk has been decreased;
In 2018 15, 00,000 will be borrowed to finance 30,00,000tk to acquire land.
29
Pro Forma Income Statements:

Particulars 2015 2016 1st year 2nd year 3rd year
264,506,
Net Sales 900 317,408,280 360000000 442225000 522000000
Cost of Goods Sold
(variable cost 9522248
included) 4 114266981 129600000 159201000 187920000
169,284,
Gross profit 416 203,141,299 230400000 283024000 334080000
Operating expenses
Selling and
administrative 5290138
expense 0 63481656 90000000 110556250 130500000
116,383,
Operating Income 036 139,659,643 140400000 172467750 203580000
1745745
Interest income 5 20948946.45 19203200.73 20076073.59 19639637.16
Financing cost,
including interest 29,983,624.2 31,603,624.2 33,223,624.2 34,843,624.2
expense 350000 0 0 0 0
Income before 133,490,
income taxes 491 130,624,965 127,999,577 159,320,199 188,376,013
Income tax expense 150000 150000 150000 150000 150000
Income after income 133,340,
taxes 491 130,474,965 -150,000 159,170,199 188,226,013
133,340,
Net income 491 130,474,965 -150,000 159,170,199 188,226,013
Earnings per share
(EPS) 2.82 3.1 2.96 3.03 2.995
Gross Margin (yearly):

Gross Profit over the projected
500000000
0
1 2 3
30
Pro Forma Balance Sheet for Eavesdropper:
Projected- Projected- Projected-3rd

Particulars 2015 2016 1st year 2nd year year
Assets
Current assets
Cash and cash
equivalents 222,239,239 147,476,111 184,857,675.00 166,166,893.00 175,512,284.00
Accounts receivable,
less allowance 154,692,772 168,615,121.48 182,104,331.20 196,672,677.69 212,406,491.91
Inventories 241,188,986 253,248,435 265,910,857 279,206,400 293,166,720
Total current assets 618,120,997 569,339,668 632,872,863.26 642,045,970.61 681,085,495.82

Property, plant and
equipment
Total property, plant and
equipment 239,378,737 239,470,737 239,562,737 239,654,737 239,654,737
Less: accumulated
depreciation 400,000 400,000 400,000 400,000 400,000
Net property, plant and
equipment 238,978,737 239,070,737 239,162,737 239,254,737 239,254,737
Investment in shares 68328952 3471835882 3721162046 1176151163 1482436835
Total Assets 285,667,452.00 342800942.4 388800000 477603000 563760000

Liabilities and
shareholders' equity 141,582,304 164,283,115.00 186,228,490.00 186,228,490 186,228,490
Current liabilities 427,249,756.00 507,084,057. 575,028,490.00 663,831,490 749,988,490
Accounts payable 115,140,702 3,338,623,832 3,607,130,843 968,582,025 1,232,500,244
Accrued expenses 27,762,615 29,262,615 30,762,615 32,262,615 33,762,615
Total current liabilities 570,153,073.00 3,874,970,504 4,212,921,948.00 1,664,676,130.00 2,016,251,348.57
Long-term liabilities 47,854,720.00 87,754,720.00 67,804,720.00 77,779,720.00 72,792,220.00
Long-term debt 200,520 300690 250,605 275,648 263,126
Total liabilities 307,220,373 317,220,373 312,220,373 314,720,373 313,470,373
Shareholders' equity 355,275,613.00 405,275,783.00 380,275,698.00 392,775,740.50 386,525,719.25
common stock 925,428,686.00 4,280,246,287 4,593,197,646.00 2,057,451,870.50 2,402,777,067.82
Retained earnings 222,239,239 147,476,111 184,857,675.00 166,166,893.00 175,512,284.00

Total shareholders
equity 285,667,452.00 342800942.4 388800000 477603000 563760000
31
Pro Forma Cash flow Statement for Eavesdropper:

Particulars 2015 2016 1st year 2nd year 3rd year
Cash flows from operating
activities
Net income 133,340,491 130,474,965 -150,000 159,170,199 188,226,013
Changes in working capital 3000000 3100000 3050000 3075000 3062500
Depreciation -400,000 -400,000 -400,000 -400,000 -400,000
Increase(decrease) in A/R 7,734,638.60 15,175,360.93 13,295,542.85 (9,833,633.88) 10,620,324.60

Increase(decrease) in
inventory 221881996 12,059,449 12,662,422 13,295,542.85 13,960,320.00
Increase(decrease) in A/P -25,667,452 57,133,490.40 -731600942.4 88803000 86157000
Total Adjustments 206,549,182.60 87,068,300.63 (702,992,977.78) 94,939,908.97 113,400,144.59

Net cash provided by
operating activities 339,889,673.60 217,543,265.88 (703,142,977.78) 254,110,108.36 301,626,157.55
Cash flows from investing
activities
Purchase of building and
equipment (239,378,737) (239,470,737) (239,562,737) (239,654,737) (239,654,737)
Net cash flows provided
by investing activities (239,378,737) (239,470,737) (239,562,737) (239,654,737) (239,654,737)
Cash flows from financing
activities
Proceeds from increase in
long-term, debt 10,00,000 15,00,000 15,00,000 15,00,000 15,00,000
Net cash flows provided
by financing activities 31,500,000 32,000,000 31,750,000 31,875,000 31,812,500
Increase in cash 30,500,000 30,500,000 30,250,000 30,375,000 30,312,500
Cash and cash equivalents
at the beginning of the
year 222,239,239 147,476,111 184,857,675.00 166,166,893.00 175,512,284.00
32
Conclusion
We feel that our business will be successful and we will be able to meet the needs of our
customers and give them a 100% satisfied service. Making the name of our business in the
country is our target. We will put our best to make this business a successful one. We are looking
forward to cover up all our expenses mentioned in the financial part and achieve our goal in the
proper way. With the expectation of high profitability, it is assumed that it would be a perfect
product to be manufactured in todays world which is burdened by sound pollution but demands
razor sharp focus.
33

Business Plan On Eavesdropper

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Business plan for Eavesdropper: Frequency controller headphones

Business Plan for:

Hear According to Your Ear. F-306

A Term Paper on, Business Plan for Eavesdropper Headphones

Muhammad SaifulAlam 21-201

Subject: Letter of Transmittal for Term-Paper

The project breaks even in the third year.

Unique Marketing Strategy ....................................................................................................... 16

Human Hearing Factors Audible Range Eavesdroppers Sensitive

Tolerable and sensitive audible range.

Core competitors:So as our industry is composed of huge variety of products, in order to

Environmental: Different environmental issues such as weather, climatic change, global

Porters Five forces Model

Industry attractiveness:Along with the discretion of industry trend, we have also

Company History:Eavesdropper private limited Company is a new company that will

The tagline is: Hear according to your Ear

The main reasons of selecting these segments are:

They are exposed to sound problem to a great extent.

They have the buying power of our product.

Competitor Analysis: There is no company particularly producing headphones. But there

Competitive Analysis Grid:

Name Eavesdropper Local Brands Global Brands Chinese

Feature Advantage Disadvantage Disadvantage Disadvantage

Quality Advantage Disadvantage Even Disadvantage

Price Disadvantage Even Disadvantage Advantage

Eco Friendliness Advantage Disadvantage Disadvantage Disadvantage

Management Even Advantage Advantage Disadvantage

After-sale Advantage Advantage Advantage Disadvantage

Distribution Even Advantage Advantage Disadvantage

Overall Advantage Even Advantage Disadvantage

Market has a growth of 20.3% every year.

Units 300000 361000 435000

Economics of the business

Revenue drivers and profit margins:

1. Profit will increase if we increase our price.

2. Profit will increase if we could decrease variable costs

3. Profit will increase if we could decrease fixed costs

4. Profit will increase if we could increase sales volume

Fixed and variable costs:

Projected- Projected- Projected-

BEP(Tk) 506,082,945 508,630,748

Graphical presentation of BEP:

Value Proposition of Eavesdropper is Hear According to Your Ear.

Product: Eavesdropper brings three unique products in the market.

Eavesdropper Frequency Adjust

Fully Smartphone Functioning

Special Frequency Range

Model Price (Tk.)

Eavesdropper Aid Pro 2000

TV ads, Radio Broadcasting

Suitability of the Strategy: As our product is a solution to social problem (sound

Total Marketing Budget

Divisional 200,000 8 1,600,000 4,800,000

Ad rate from: http://www.atnbangla.tv/tv-ad-rate/

Design and Development Plan

General Approach to Operations: The business will be run by at office

The production will take place in the factory at Savar.

The outsourced raw materials will be brought by ship at Mongla port.

Management team and Company structure

IT support:Businesses today cannot survive without an IT department. This department will be

Management Team:The management team consists of 10 full-time employees including

Profit Margin Ratios (over the projected years):

Operating leverage is a measurement of the degree to which we have projected a combination of