Business Plan: Institute of Management Sciences Lucknow University

Business Plan
Submitted to
Institute of Management Sciences
Lucknow University
Submitted By
Amar Kumar Gupta
MBA (Retail Management)
Institute Of Management Sciences
Lucknow University
Lucknow
Deity Retail Store Owner- Amar Kumar Gupta 1

Deity Retail Store
A Convenience Store
Owner- Amar Kumar Gupta

Table of Content
Deity Retail Store 2
Executive Summary 5
1.1 Objectives 9
1.2 Mission 10
1.3 Keys to Success 12
2.0 Company Summary 14
2.1 Hours of Operation
15
2.2 Company Ownership 15
2.3 Start-up Summary
15
2.4 PRODUCTS 16
2.5 SERVICES 19
MARKET ANALYSIS SUMMARY 20
3.1 Market Segmentation 22
3.2 Target Market Segment Strategy
24
3.3 Technology: Electronic Marketing
25
3.4 Promotions 26
Industry Analysis 27
4.1Industry Trends 29
4.2 Competition 30

4.3 Buying Patterns 31
Strategy and Implementation Summary 31
5.1 Distribution Strategy: 33
5.2 Services & Support Philosophy 33
5.3 Competitive Edge 34
5.4 Marketing Strategy 34
5.5 Sales Strategy 36
5.6 Sales Forecast 37
5.7 Milestones 38
Management Summary 39
6.1 Personnel Plan 40
Financial Plan 40
7.1 Important Assumptions 41
7.2 Break-even Analysis 41
7.3 Projected Cash Flow 42
7.4 Projected Profit and Loss 44
7.5 Projected Balance Sheet 47
7.6 Business Ratios 48
Appendix 50

Executive Summary
Deity Retail is a business specializing in general
merchandise. It will be located in the brand-new
Town Gomti Nagar, which is in a high traffic area.
The space will be near to NeelKanth Sweets. The
space is easily accessible and provides ample
parking for its customers. The space is visible from
all points within the center itself as well as the
traffic from Vivekkhand Road and Jaipuria
Management Institute. The business is a retail
establishment selling current good variety
merchandise at retail. The majority of the
merchandise is priced within a reasonable price
range, thus attracting the widest possible range of
customers.
Deity Retail has access to the purchasing power

of buying centers offering merchandise at prices 5
to 10 percent below wholesale with immediate
delivery and low to no minimum orders. These
centers are well stocked and prepared to meet the
increased demands of the peak selling seasons such
as Seasonal Changes, Back-to-School, Holiday
Needs, etc. Since delivery from these centers to the
business takes only five to ten days, Deity Retail is
assured of a well-stocked store regardless of
seasonal demands. Also, since these buying centers

are able to deliver in such a short time, there is not
a necessity to carry an extremely large inventory in
advance of peak selling periods.
Deity Retail attracts its customers through the

use of specialized advertisements, handbills, news
releases in newspapers, as well as the traffic flow of
which the area itself generates.
A Grand Opening will commence after Deity

Retail has been in business for six to eight weeks.
This event will be held on a Saturday. Deity Retail's
owner Amar Kumar Gupta will coordinate the Grand
Opening. It will include a local political official,
ribbon-cutting ceremonies, pictures, speaking, etc.
Professional news releases will be submitted to the
local and market area newspapers, and possibly
radio and television.
The storeowner of Deity Retail has access to

over 250 of the best buying centers in the city. The
buying centers provide inventory and fixtures. Amar
Kumar Gupta will take a buying trip for initial
inventory with her close friend and professional
buyer Ashok Kumar Gupta. All staff will be provided
with in-store training.
According to the information contained in this

business plan, we feel that Deity Retail is a sound
business investment for the financial institution to
consider for a loan in the amount of Rs 800000.

Deity Retail will sell the same products as
other convenience stores in the same packaging
sizes, quality, and quantity as other stores. This
includes soft drinks, fruit juices, sport drinks, hot
and cold snacks, a number of grocery items such as,
paper products, toothpaste, all general merchandise
etc.
All products will be locally or nationally branded

such as Frito-Lay, Coca-Cola, Hindustan Uniliver,
Dabar, Brittania, etc. In addition each computerized
transaction machine can dispense cash, stamps,
Lotto and phone cards and other coupons and will
have the ability to create personal accounts that
can display preferred items, retain shopping lists
and other services. An automated, interactive
"customer service rep" will be able to answer
questions and pass on comments to the company's
management.
In addition, the company is looking into ways to

set up a separate Internet area for remote access to
the Web and email for its customers.
The Market
Our market is booming. Convenience store
industry sales rose 8.6% last year. Overall retail
sales grew by only 6.3%, and grocery sales followed
with 2.4% growth, proving once again that the

convenience store industry has become a powerful
force in retailing.
Convenience stores serve the entire purchasing

population of its geographical area but focuses on
customers who need to purchase items outside of
normal working hours such as swing shift employees
and quick shoppers looking for snacks and related
items. Therefore we have segmented our market
into night shoppers, quick shoppers, and others.
Growth rates for these three segments match the
population growth for the surrounding area.
Our main competitor is Spencer which holds

approximately 30% of the market. Other
competitors include small retailers and any of the
85 grocery establishments around area.
Financial Considerations
Our start-up requirements come to Rs.
1332,000, which are largely single time fees
associated with opening the store. These costs are
financed by both bank loan and the investment of
Amar Kumar Gupta. It should be noted that we
expect to be operating at a loss for the first three
months before advertising begins to take effect and
draw in customers.
Deity Retail will be receiving periodic influxes of

cash in order to cover operating expenses during

the first two years as it strives toward sustainable
profitability. Almost all of this funding has been
arranged through bank loan and owner’s capital
already. We do not anticipate any cash flow
problems during the next three years.
1.1 Objectives
As a leading wholesale distributor, our
commitment is to provide quality products and
services in a cost-effective manner, enabling Deity
Retail to excel in serving their customers.
These are the goals for the next three years for
Deity Retail:
• Achieve profitability by July Year 1;

• Earn approximately Rs. 200,000 in sales by
Year 1;
• Start up second store by Year 2.
• Explore potential growth in downtown market
and evolve new sources of business.
• To provide a wide range of merchandise
at reasonable prices.
• To achieve a healthy profit margin within the
first year.
• To achieve a modest net profit by month six.
• To be an active and vocal member of the
community, and provide continual re-
investment through participation in community
activities and financial contributions.

• A clean environment in which to shop
• A safe place to shop
• Value
• Great, friendly service
• Our shop will be good neighbors and will be
involved in the community
• Store will have minimum weekly retail sales of
Rs. 300,000 which is equivalent to
approximately Rs. 75,000 of purchases weekly
at the wholesale level
• Create benchmarks for measuring success
1.2 Mission
Deity Retail's mission is to create a Retail store
that is reliable and convenient. A store that offers
great service and selection of products in a
customer friendly environment.
Deity Retail will cater to residents, businesses,

contractors. Our customers will become loyal
because of the great advice, prompt service, good
staff attitudes, the overall quality of the shopping
experience, and the fact that we consistently have
solutions for their needs.
The Deity Retail Store provides a variety of

interesting merchandise options at fair prices.
Dedicated to customer service the Deity Retail Store
will give its patrons the kind of service that is
respectful and prompt. Employees of the Deity

Retail Store will also be treated in a professional
manner with a rewarding work environment and fair
compensation.
Deity Retail's primary objective is to create a

new and revolutionary distribution outlet that will
significantly reduce prices for its customers and
provide greater services with an equal level of
quality. The company seeks to be first to market
with this daring new idea so as to capture market
share and create greater than average profits.
Our mission is to provide the Gomtinagar area

with a wide variety of quality general merchandise
in a clean and friendly atmosphere.
The Deity Retail Store will provide residents and

guests a quality and dependable retail operation
from which they may purchase food items, groceries
on a year-round basis. The Deity Retail Store shall
try to provide its quality products in a
comprehensive and cost competitive manner, while
providing our customers the finest service available.
Our most fundamental philosophy is the

concern for people. This strong belief in people is
the determining factor that motivates our
operations in developing our relationship with our
employees and customers.
We believe that our responsibility for customer

satisfaction is not focused solely on the sale of a

product, but rather is the total relationship a
customer experiences when interacting with our
organization. We believe in honesty and truth in all
transactions and in providing products of the
highest quality and at fair prices. We should do
everything possible to provide outstanding service
in marketing the products we sell.
Our philosophy of concern for people gives our

Deity Retail Store the drive to be a good corporate
citizen. We believe we have a responsibility to be a
good neighbor in maintaining our property in first-
class condition and by making the appearance of
our plant, facilities, equipment, and grounds as
attractive as possible, making them an asset to the
communities that support our company.
We at Deity Retail Store of Gomtinagar, are

committed to bringing you the best all-around
shopping experience. Our nice pledge campaign
includes an intense training session for all of our
employees, and a firm understanding and
commitment to deliver these pledge points at the
Deity Retail Store.
1.3 Keys to Success

In order to survive and expand, Deity Retail must
keep the following issues in mind:

• We must attain a high level of visibility through
the media, billboards, and other advertising.
• We must establish rigid procedures for cost
control and incentives for maintaining tight
control.
• We must expend a significant amount on R&D
in order to constantly be able to offer better
and greater products and services.
• A service designed specifically for the area
• Total quality food and customer service
• Controlled overhead and operational costs
• Regular and ongoing customer feedback
• Inventory and DNR technology/software
capacity
• Dedicated management and trained support
staff
To succeed in this business we must:
• Sell a broad range of products.

• Provide for the satisfaction of 100% of our
customers.
• Be an active member of the community.
• Encourage customer input.
Service and Convenience are the keys to success

in this business. They are also the strengths of
independent retail stores. Our personnel have
experience in high-end client hospitality. This
experience will be invaluable in dealing with
customers and clients. We will also keep meticulous

records on what customers are looking for that we
do not currently have in stock. As discussed earlier,
a delivery program will be developed to make it
easy for business customers to receive products
without leaving the office.
• Prepaid account facility in which a registered

customer will get interest on unused balance at
the end of the month which is two to four times
more than bank interest rate.
2.0 Company Summary

The Deity Retail Store sells products and
provides excellent customer service for the general
public. We have leased a retail store which we use
to market and merchandise our products. It is
located in Gomtinagar.
Deity Retail will rent a 3,000-square-foot space,

having 1,000 square feet of front space. Located in
the brand-new Town Gomtinagar, it is a high traffic
area. The space will be next to NeelKanth Sweets.
The space is easily accessible and provides ample
parking for its customers. The space is visible from
all points within the center itself as well as the
traffic from Vivekkhand Road and Jaipuria
Management Institute.
Since the selected location is in the heart of one

of the busiest retail corridors in the area, we feel

that this space is the best possible location in
Gomtinagar and surrounding areas.
2.1 Hours of Operation

Store hours will be 7 days a week from 10:00
A.M. until 10:00 P.M. Checks and all major credit
cards will be accepted. A food stamp policy along
with other policies will be in place.
2.2 Company Ownership

Deity Retail is a sole-proprietorship and is
registered to the owner, Amar Kumar Gupta.
2.3 Start-up Summary

Start-up costs will be financed through a
combination of owner investment and a short-term
loan. The start-up chart shows the distribution of
financing.
Start-up Plan
Start-up Expenses Rs.
Deposit on Location 100000
Rent (2 months) 20000
Build-out of location (including sign) 120000
Telephone Deposits/2 months' payments 75000
Credit Card Machine 1500

License and Permits 5000
Insurance (6 months) 3000
Advertising (2 months) 6000
Miscellaneous 2000
Total Start-up Expense 332500
Start-up Assets Needed
Cash Requirements 120000
Start-up Inventory 880000
Other Short-term Assets 0
Total Short-term Assets 1000000
Long-term Assets 0
Total Assets 1000000
Total Start-up Requirements 1332500
Left to Finance: 0
Start-up Funding Plan

Investment
Amar Kumar Gupta Rs. 532500
Investor 2 Rs. 0
Other Rs. 0
Total Investment Rs. 532500
Short-term Liabilities
Unpaid Expenses Rs. 0
Short-term Loans Rs.800000
Interest-free Short-term Loans Rs. 0
Subtotal Short-term Liabilities Rs.800000
Long-term Liabilities Rs. 0
Total Liabilities Rs.800000

Loss at Start-up Rs.30000
Total Capital Rs.500000
Total Capital and Liabilities Rs.832500
Check line Rs. 0
2.4 PRODUCTS
The Deity Retail Store will offer the top 31 best-

selling industry items as determined by Retail
Association.
The store will sell over 3,000 private label and

national brand products to the community.
As the most progressive company in the

industry, Deity Retail plans to offer a greater
number of products and services in the future so as
to create another dimension of competitive
advantage. So that our customers will feel secure,
we will subscribe to the security services offered by
the security center of which we are a part. This will
cut down on graffiti and loitering and insure the
safety of both employees and customers.
Deity Retail will sell the same products as other

convenience stores in the same packaging sizes,
quality, and quantity as other stores. This includes
soft drinks, fruit juices, sport drinks, hot and cold
snacks, grocery items, paper products, toothpaste,
all general merchandise etc.

All products will be locally or nationally
branded. In addition computerized transaction
machine can dispense cash, stamps, Lotto and
phone cards and other coupons and will have the
ability to create personal accounts that can display
preferred items, retain shopping lists and other
services. An interactive "customer service rep" will
be able to answer questions and pass on comments
to the company's management.
The Deity Retail Store sells a variety of quality

discount merchandise. The types of merchandise we
will carry will include items such as, household
goods, toys, cosmetics, candy, and a list of items
too exhaustive to list here. A dedicated staff is
committed to providing excellent customer service.
The merchandise is purchased from a variety of

well-known manufacturers such as Procter &
Gamble, Hindustan Unilever Limited as well as a
number of other generic branded companies.
Shipments arrive on a daily basis. We will continue
to find new product lines that can be added to our
inventory.
We are able to sell products at very low prices,

because we will purchase items from discontinued
lines, seconds, over runs, etc., that cannot be sold
to a manufacturer's usual retail customers.
• Alternative Snacks

• Icecream
• Nonedible Grocery
• Candy
• Other Dairy
• Cigarettes
• Other Tobacco
• Cold Dispensed Beverages
• Packaged Beverages (Non-Alcohol)
• Edible Grocery
• Packaged Bread
• Packaged Ice Cream/Novelties
• Fluid Milk Products
• Packaged Sandwich/Deli Products
• Packaged Sweet Snacks
• Frozen Foods
• General Merchandise
• Publications
• Health and Beauty Care
• Salty Snacks
• Homemade Food Items
The product listing takes into account regularly

requested items and the ability to offer standing
order items for area residents as space
requirements allow.
2.5 SERVICES

1. Prepaid account facility
• In this facility customer can register himself by
opening an account like bank account with any
amount of rupees.
• A registered customer can buy any
merchandise and the price of merchandise will
be debited from his account so the customer
has no need to pay cash money at every
purchase.
• A registered customer will get interest on
unused balance at the end of the month which
is two to four times more than bank interest
rate.
• A registered customer can access more
services such as order facility through sms, fax,
telephone, e-mail and free home delivery on
lower minimum order of Rs. 300.
2. Free home delivery at minimum order of Rs 400

for non-registered customers.
MARKET ANALYSIS SUMMARY
By household size, grocery spending ranges

from an average of Rs. 51 per week in one-person
households to Rs. 130 per week in households of
five or more. Per-person spending is inversely
correlated with household size: per-person weekly

expenditures are only Rs. 23 in households with five
or more members but Rs. 35 in one-person homes,
according to the Food Marketing Institute.
The Drishti Creative Services Department is

ready to meet those needs by providing everything
from concepts and design to printing and signage.
They are experts in the process of creating and
printing advertising, brochures, newsletters,
business forms, stationery/business cards, P.O.S.
materials, screen-printed clothing/merchandise, and
weekly 4-color grocery insert mailers/circulars.
Whether we need a bag stuffer, a new logo,
billboard advertising, radio spots, TV commercials,
or a video, their creative and professional team of
associates and state-of-the-art printing equipment
offer customers high-quality products in a timely
and efficient manner.
We expect sales to increase steadily as

consumers find that they can purchase a variety of
quality items at bargain prices. We intend to tap
into the retail market with pricing that will
encourage quantity buying, and our pricing will
attract consumers on fixed budgets.
Our target market is the working class
individuals, the elderly, and students, many of
whom are price conscious and looking to find a
value for their rupee.

Our market is booming. Convenience store
industry sales rose 8.6% for 2002. Overall retail
sales grew by only 6.3% and grocery sales followed
with 2.4% growth, proving once again that the
convenience store industry has become a powerful
force in retailing.
items. Therefore we have segmented our market
into night shoppers, quick shoppers, and others.
Growth rates for these three segments match the
population growth for the surrounding area.
Deity Retail will provide high quality
merchandise at a discount price range to its
customers. Deity Retail will be able to maintain its
competitiveness.
3.1 Market Segmentation
Seventy-three percent of our shoppers are

female head of the households, 11 percent are male
head of the households, 15 percent are both and 1
percent are other. Household Income: Average
weekly household spending ranges from Rs. 2000
for shoppers earning under Rs. 15,000 and Rs.

25000 for those earning more than Rs. 75,000 per
month. Spending on groceries at the consumer's
primary store also increases with income from Rs.
1500 per week for those families earning Rs.
15,0000 or less per year to Rs. 2500 per week for
those earning over Rs. 75,0000.
Our target market for our test store
encompasses a one kilometer radius in which the
approximate population is 50,000 (based on census
information).
The majority of household monthly incomes
range from Rs. 20,000 - Rs. 30,000 (50.3%), yet
there are also affluent household incomes ranging
from Rs. 50,000 - Rs. 100,000 (15.4%).
The target female market is in a growing
community that has a population in excess of
39,889 people, well over 14,344 households, of
which approximately 53.8 percent are female. The
median family income for Gomtinagar is Rs. 21,729.
items.

Market Analysis
Year 1 Year 2 Year 3 Year 4 Year 5
Potential
Growt
Customer CAGR
h
s
Late night 3.00
3% 78,000 80,340 82,750 85,233 87,790
shoppers %
Quick 2.00
2% 42,000 42,840 43,697 44,571 45,462
shoppers %
2.80
Other 3% 30,000 30,840 31,704 32,592 33,505
%
150,00 154,02 158,15 162,39 166,75 2.68
Total 2.68%
0 0 1 6 7 %
General Statistics for 1999 in the area are as

follows:
Total Population - 49,889
Number of Households - 9,344
Population by Gender
Male - 46.2% Female - 53.8%
Income Figures
Median Household Income - Rs. 21,729
Household Income Under Rs. 50K - 75.3%

Household Income Rs. 50K-Rs. 100K - 20.8%

Household Income Over Rs. 100K - 4.0%
1990 Housing Figures
Average Home Value - Rs. 38,152

Average Rent - Rs. 272
The businesses target client groups are local

residents within a 1 Km radius, or approximately
1,000 people.
3.2 Target Market Segment Strategy
Deity Retail will provide high quality

merchandise at a discount price range to its
customers. Deity Retail will be able to maintain its
competitiveness.
Our store will meet the grocery needs of the

surrounding neighborhood of female or male head
of households earning Rs. 15,000 per year or more.
We focus on the price conscious consumer who
is looking for value as well as quality. Both the Bend
and the Redmond groups will be marketed to as
they are isolated populations which do most of their
shopping in the greater Bend area. If we can attract
and keep these consumers the word will continue to
spread about what our store has to offer.

The approaches to be used to attract these
customers will be a website, radio and print
advertising, signs in the store windows, and word of
mouth advertising from our satisfied customers.
3.3 Technology: Electronic Marketing
Deity Retail is committed to keeping up with

technology changes, thereby gaining a competitive
edge in the marketplace. Computers and other
information systems are integrated to provide
management information and time-saving tools.
These include:
E-mail systems
Standard accounting software
Computer-based training
Support is always available to answer system

and software development questions, or provide
programming solutions as new industry
developments appear.
To support our retail store(s), electronic

marketing allows us to access complete data
analysis and marketing services. These services
include data storage, strategic
planning/consultation, sourcing for card/key tag
manufacturing, custom marketing program

development, promotions and campaigns, electronic
marketing training and education, retailer-specific
data analysis, and support of third-party programs.
3.4 Promotions
Building store traffic, generating consumer

excitement, accelerating sales and profits, and
positioning our store competitively in the market will
be relatively simplified by the use of the Sales
Promotions. Deity Retail select those promotions
that best meet their unique marketing needs.
Backed by TV spots, circulars, P.O.S. materials,
sweepstakes and more, this promotional activity is
key to our retail success.
We focuse on these major areas:
• Internal and external store appearance

• Product availability
• Point-of-purchase materials
• Food service
• Most importantly, the quality of service
received at the register
Employees are eligible to earn cash incentives
and top stores are honored with awards quarterly.
In order to portray the professional image that

Deity Retail customers have come to expect, a

selection of uniforms are available. Uniform
requirements are facilitated with the use of a
contracted distribution and laundry service.
Industry Analysis
In 1999, retail sales grew 9 percent to almost

Rs. 3 trillion rupees. General merchandise and
apparel grew to Rs. 784.5 billion, a 7.6 percent rise
over 1998. According to the Department of
Commerce, Internet shopping reached Rs. 5.3 billion
or .64 percent of retail sales in 1999. The growth of
traditional retailing should not be robust due to a
dearth of economically favorable store locations.
Many companies have responded by using their
capital for other purposes such as reducing long-
term debt and repurchasing their common stock.
Some companies can continue to grow their

store count where they have a very specific
demographic group to serve and locations can be
developed in sparse locations at minimal costs. Keys
to their success are convenient locations, relatively
small stores, and the ability to provide most
nonfood merchandise to their lower-income
customer bases.
The retailing industry is mature and slow

growing. These factors mean companies will have to

do a better job of managing their operations.
Specifically, retailers must close unprofitable stores,
locate in regions with faster growth, and manage
their inventory better. Retailers must also invest in
automated processes to keep their costs down.
Some companies have taken steps to reduce their
exposure to economic cycles and consumer trends.
Traditional retailers may have finally recognized

the potential of Internet commerce and its impact
on their business. Initially, retailers had just a
website that was more for informational purposes
than e-commerce transactional purposes. However,
beginning in the year 2000, several retailers will
devote more time to developing full blown e-
commerce sites.
Convenience store industry sales rose 8.6% to

Rs. 86.3 billion for 2002. Overall retail sales grew by
only 6.3%, and grocery sales followed with 2.4%
growth, proving once again that the convenience
store industry has become a powerful force in
retailing.
Merchandise sales per customer increased

7.4% in 2000 suggesting that convenience stores
are placing higher priority in filling the customers'
needs. Companies that align themselves properly to
fill those needs will be successful in the future.

Gross margin for the quarter widened to 13.1
percent from 12.2 percent, reflecting the higher
margins associated with the retail grocery
operations acquired in fiscal 2000.
4.1Industry Trends
Consumers are more value conscious than

they've been in the past. Their shopping habits have
shifted from department stores to discounters and
mass merchandisers. Many consumers can find the
same items at a mass merchandiser that they can
find at a department store at a substantially lower
price.
Competition and Buying Patterns
There is currently no other store of this kind in
the area, which ensures its success!
Deity Retail will offer a wide selection of general
merchandise. Having over 5,000 different items to
choose from for its inventory selection insures that
Deity Retail will be able to maintain a full and
diverse inventory for its customers. It will have
suppliers that can deliver these items within 5-10
working days, so the shelves and walls will remain
full and well-stocked.
Some retailers have responded by offering
theme promotions during other parts of the year,
such as Holi, Rakshabandhan, Deepawali,
independence day, Republic Day. Retailers are also

requiring their suppliers to develop unique and
exclusive merchandise and product assortments for
their stores to avoid competition with another store
for the same product.
Consumers are much more value-oriented
which has contributed to the growth of mass
merchandise stores. Another indication is the
growth of the wholesale and retail store concept
over the past two decades. These stores allow
consumers to buy products in bulk and get more
products for their money. These stores mostly carry
fast-moving merchandise brands which are number
one or two in their respective product categories.
The Gomtinagar area continues to expand,
offering the retail establishments an ever-growing
opportunity for success.
4.2 Competition
Marketed at a lower shelf price than national

brands, private brand products give Deity Retail
retail a competitive advantage.
The store will be in walking distance of area
shoppers, whereas the next nearest grocery store is
two to three kilometers from our store location.
Consumers demand quality customer service,

fair pricing, and a convenient location.

Competition is very tough with customer
service and location key components. The selection
of merchandise a store provides is also very
important.
4.3 Buying Patterns

The average household spends per year:
Food Rs.60000.00
Health and personal hygiene Rs. 6000.00
Other Rs.15000.00
Total Rs.81000.00
Currently there are 5000 households within a 1

km radius and approximately 49,345 households in
the gomtinagar. According to survey reports,
Gomtinagar residents spend 40 crore rupees per
year on grocery store and other food products.
Based upon the number of households and the
average spending Gomtinagar residents spend
14,872.00 per person per year on grocery store and
other food products.
Calculating the average spending based upon
5000 homes in the local area at 5% of average
spending it is estimated that Reid's Convenience
Store could conservatively gross Rs. 6000,000 per
year.

Strategy and Implementation
Summary
Amar Kumar Gupta has chosen three strategies
for implementation of Deity Retail and they are:
• to build sales volume

• to create a customer database
• to develop an effective product line and pricing
strategy
All business is helped by advertising and referrals,

so for the first few years the Deity Retail Store will
need to be aggressive in getting new customers,
who will then pass the word on, and the business
can begin to experience sustained growth.
The most critical element of Deity Retail's success

will be its marketing and advertising. In order to
capture attention and sales Deity Retail will use
prominent signs at the store locations, billboards,
media bites on local news, and radio advertisements
to capture customers.
Many of the initial customers will be drawn to the

unique nature of the store and will then have the
opportunity to realize the cost savings of Deity
Retail. We expect an average 27% increase in sales
from year to year. This may seem very high, but
considering the level of initial sales and the growth

possibilities, management actually considers this to
be conservative.
The Deity Retail Store uses a strategy of total

market service. Our promise is in our location and
the products we sell, the people we attract, and the
atmosphere we create.
Ultimately, we are selling more than just

merchandise. We are selling ourselves. We want to
provide the kind of customer service that will
provide an atmosphere that creates a positive
shopping experience for our customers.
Strategic Assumptions:
1. Every person with income limitations or on fixed

incomes is a potential customer.
2. Marketing to these segments of the population
will lead to an expansion in overall market
growth.
5.1 Distribution Strategy:

Customers can contact the Deity Retail Store by
telephone, fax, and by dropping in. The Deity
Retail Store's nearest competitors' are five km.
around either direction. The store can stock
request items for regular area residents.
5.2 Services & Support Philosophy

Giving careful consideration to customer
responsiveness, the Deity Retail Store's goal will
be to meet and exceed every service expectation
of its food products and retail merchandise.
Quality service and quick responsiveness will be
the philosophy guiding a customer approach to
the Deity Retail Store.
5.3 Competitive Edge

Deity Retail will be locally owned and operated,
insuring that the needs and desires of the local
community are met. It will also be able to provide
special ordering of items for its customers and offer
a personal and friendly atmosphere that you cannot
find in larger chain variety stores.
Deity Retail's competitive edge will be the lower

prices we will charge our customers and the novel
purchasing experience that will draw shoppers. In
the convenience store industry, low cost and
availability are the two success criteria. We plan to
create these advantages in a new, high-tech
environment that will retain customers.
Our location is a very important competitive

edge. We are located in the popular location which
has a high appeal to many different kinds of
consumers. There is a good mix of high and low end
shops with several quality restaurants near by. With
the sources we are working with it will be possible to

carry many name brand items at a discount price.
Add a staff committed to providing great customer
service and the Deity Retail Store will be an
attractive stop for the consumer.
5.4 Marketing Strategy

The most critical element of Deity Retail's
success will be its marketing and advertising.
items. In order to capture attention and sales Deity
Retail will use prominent signs at the store
locations, billboards, media bites on local news, and
radio advertisements to capture customers. Many of
the initial customers will be drawn to the unique
nature of the store and will then have the
opportunity to realize the cost savings of Deity
Retail. Since automated shopping is still in its
infancy, the firm expects to invest a great deal of its
available cash and revenues in marketing efforts.
The Deity Retail Store will benchmark our

objectives for sales promotion and mass selling.
We are focusing our marketing effort on the

community of consumers that want a store which
has an interesting variety of merchandise at bargain

prices. We will implement a strategy that treats
these customers as a community. This means our
marketing resources will be centered on both sales
promotions (events, displays) and personal sales
(customer service, friendly atmosphere).
• We will stay within our marketing budget.

• Marketing promotions will be consistent with
the Mission Statement.
5.5Sales Strategy
Since our store will be a stand-alone, remote
facility, there is little in the way being able to
directly influence how we close the sales other than
to have an attractive storefront with our low prices
and easy-to-use system. We believe that this in
itself is its own seller. One critical procedure to
ensure top customer service and reliability will be
establishing a method for keeping enough
inventories of all our products. We will be using
industry data on inventory for other convenience
store chains to assist us.
Our sales strategy is to:
• develop a website for e-commerce sales within

the next year
• provide quality customer service
• have a "no cash refund/exchanges only" policy
• accept all major credit cards

• survey our customers regarding products they
would like to see added to our store
• sponsor school and other community events
• automate our sales process, such as using bar
codes and a Point-of-Purchase cash register to
track inventory and sales
Employees are paid a straight wage but can

achieve a semi-yearly bonus based on profits and
customer satisfaction rates.
All potential sales will be attended to in a timely

fashion and long-term salesperson-customer
relationships will take precedence over sales
closure.
5.6 Sales Forecast

Based on a 20% mark-up, our forecasted sales
for years one, two, and three respectively are: Rs.
2,480,106; Rs. 3,149,735; Rs. 4,000,163. This gives
us an average 27% increase from year to year. This
may seem very high, but considering the level of
initial sales and the growth possibilities,
management actually considers this to be
conservative.

Sales Forecast
Year 1 Year 2 Year 3
Sales
Drinks Rs. 978,070 Rs. 1,242,149 Rs. 1,577,529
Snacks Rs. 873,277 Rs. 1,109,061 Rs. 1,408,508
Magazines/newspapers Rs. 209,586 Rs. 266,175 Rs. 338,042
General grocery items Rs. 279,449 Rs. 354,900 Rs. 450,723
Other Rs. 139,724 Rs. 177,450 Rs. 225,361
Total Sales Rs. 2,480,106 Rs. 3,149,735 Rs. 4,000,163
Direct Cost of Sales Year 1 Year 2 Year 3

Drinks Rs. 753,114 Rs. 956,455 Rs. 1,214,697
Snacks Rs. 672,423 Rs. 853,977 Rs. 1,084,551
Magazines/newspapers Rs. 161,382 Rs. 204,955 Rs. 260,292
General grocery items Rs. 215,175 Rs. 273,273 Rs. 347,056

Other Rs. 107,588 Rs. 136,636 Rs. 173,528
Subtotal Direct Cost of Sales Rs. 1,909,682 Rs. 2,425,296 Rs. 3,080,125
5.7 Milestones
The milestone table shows how the
responsibilities break down in the start up of our
store. Ted Brinkman will head up the drafting of the
business plan and will conduct the drive to secure
funding. Jim Spencer will work to secure a site for
the store and will handle the details with the
personnel plan. Our accountant Dick Garret will set
up our accounting plan.
Start Departmen
Milestone End Date Budget
Date t
Business Plan 1/1/2009 2/3/2009 Rs. 1,000 Owner
Secure Start Up
2/7/2009 4/9/2009 Rs. 500 Owner
Funding
Managemen
Site Selection 3/1/2009 4/2/2009 Rs. 1,500
t
Managemen
Personal Plan 6/4/2009 6/5/2009 Rs. 500
t

Accounting Plan 7/8/2003 17/8/2003 Rs. 1,000 Accounting
Totals Rs. 4,500
Management Summary
Amar Kumar Gupta, owner of Deity Retail, has
a M.B.A. degree in Retail. For two years she has
managed a store similar to Deity Retail. She has a
full understanding of how to operate and manage a
retail store and its employees.
6.1Personnel Plan
The personnel plan is included in the following
table. It shows the Manager's hourly pay, followed
by that of the rest of the staff. Each of these
positions will overlap to make sure the customers
are receiving excellent customer service and that
adequate help is on hand.
Personnel Plan FY2002 FY2003 FY2004

Other 0 0 0
1 Manager 45,760 45,760 45,760
1 Assistant Manager 37,440 37,440 37,440
4 Cashiers 74,880 74,880 74,880
4 Administrative Workers 74,880 74,880 74,880
4 Laborers/Stockers 62,400 62,400 62,400
Total Payroll 295,360 295,360 295,360
Total Headcount 15 15 15
Payroll Burden 44,304 44,304 44,304
Total Payroll Expenditures 339,664 339,664 339,664

Financial Plan
1. Growth will be moderate; cash flows steady.
2. Marketing costs will remain below 15% of sales.
3. The company will invest residual profits into financial
markets and not company expansion (unless
absolutely necessary).
4. Future cash investments will use NOV projections to
achieve maximum return with limited risk.
7.1 Important Assumptions

We do not sell anything on credit. The personnel
burden is low because benefits are not paid to
our staff. We will continue to work on a short-
term interest rate that is lower. We are also
assuming the economy will continue to grow
and there will continue to be a need for stores
such as Deity Retail.

General Assumptions FY2010 FY2011 FY2012
Short-term Interest Rate % 10.00% 10.00% 10.00%
Long-term Interest Rate % 10.00% 10.00% 10.00%
Payment Days Estimator 30 30 30
Collection Days Estimator 45 45 45
Inventory Turnover Estimator 6.00 6.00 6.00
Tax Rate % 25.00% 25.00% 25.00%
Expenses in Cash % 10.00% 10.00% 10.00%
Sales on Credit % 0.00% 0.00% 0.00%
Personnel Burden % 15.00% 15.00% 15.00%
7.2 Break-even Analysis

A Break-even Analysis table has been completed on
the basis of average costs/prices. With fixed costs,
average sales, and average variable costs, the table
and chart show what we need per month to
breakeven.

Break-even Analysis
Monthly Revenue Break-even Rs. 37,570
Assumptions:
Average Percent Variable Cost 50%
Estimated Monthly Fixed Cost Rs. 18,785
7.3 Projected Cash Flow

Deity Retail will be receiving periodic influxes of
cash in order to cover operating expenses during
the first two years as it strives toward sustainable
profitability. Almost all of this funding has been
arranged through lending institutions and private
investors already. We do not anticipate any cash
flow problems during the next three years.
Pro Forma Cash Flow

Cash Received
Cash from Operations

Cash Sales Rs. 2,480,106 Rs. 3,149,735 Rs. 4,000,163

Subtotal Cash from Operations Rs. 2,480,106 Rs. 3,149,735 Rs. 4,000,163
Additional Cash Received

Sales Tax, VAT, HST/GST Received Rs. 0 Rs. 0 Rs. 0
New Current Borrowing Rs. 5,000 Rs. 0 Rs. 0
New Other Liabilities (interest-free) Rs. 0 Rs. 0 Rs. 0
New Long-term Liabilities Rs. 50,000 Rs. 0 Rs. 0
Sales of Other Current Assets Rs. 0 Rs. 0 Rs. 0
Sales of Long-term Assets Rs. 0 Rs. 0 Rs. 0
New Investment Received Rs. 54,000 Rs. 78,000 Rs. 0
Subtotal Cash Received Rs. 2,589,106 Rs. 3,227,735 Rs. 4,000,163
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations

Cash Spending Rs. 167,400 Rs. 214,000 Rs. 238,000
Bill Payments Rs. 2,177,877 Rs. 3,134,865 Rs. 3,620,688
Subtotal Spent on Operations Rs. 2,345,277 Rs. 3,348,865 Rs. 3,858,688
Additional Cash Spent

Sales Tax, VAT, HST/GST Paid Out Rs. 0 Rs. 0 Rs. 0
Principal Repayment of Current
Rs. 0 Rs. 7,000 Rs. 13,000
Borrowing
Other Liabilities Principal Repayment Rs. 0 Rs. 0 Rs. 0
Long-term Liabilities Principal
Rs. 0 Rs. 5,000 Rs. 10,000
Repayment
Purchase Other Current Assets Rs. 0 Rs. 0 Rs. 0
Purchase Long-term Assets Rs. 0 Rs. 0 Rs. 30,000
Dividends Rs. 0 Rs. 0 Rs. 50,000
Subtotal Cash Spent Rs. 2,345,277 Rs. 3,360,865 Rs. 3,961,688
Net Cash Flow Rs. 243,829 (Rs. 133,130) Rs. 38,475

Cash Balance Rs. 357,649 Rs. 224,519 Rs. 262,994
7.4 Projected Profit and Loss

We predict advertising costs will go down in the
next three years. We will be able to find what has
worked well for us and concentrate on those
advertising methods. Normally, a start-up concern
will operate with negative profits through the first
two years. We will avoid that kind of operating loss
by knowing our target markets.

The following table explains our itemized costs
and determines gross and net margin. Please note
that these predictions are weighted toward having
higher costs in comparison to revenues in case
unexpected hidden costs arise. The charts give a
visual representation of the data.

Pro Forma Profit and Loss
Sales Rs. 2,480,106 Rs. 3,149,735 Rs. 4,000,163
Direct Cost of Sales Rs. 1,909,682 Rs. 2,425,296 Rs. 3,080,125
Other Costs of Goods Rs. 0 Rs. 0 Rs. 0
Total Cost of Sales Rs. 1,909,682 Rs. 2,425,296 Rs. 3,080,125
Gross Margin Rs. 570,424 Rs. 724,439 Rs. 920,037

Gross Margin % 23.00% 23.00% 23.00%
Expenses
Payroll Rs. 167,400 Rs. 214,000 Rs. 238,000
Sales and Marketing and Other
Rs. 60,000 Rs. 130,000 Rs. 130,000
Expenses
Depreciation Rs. 7,200 Rs. 7,200 Rs. 7,200
Leased equipment Rs. 50,000 Rs. 60,000 Rs. 60,000
Rent Rs. 84,000 Rs. 84,000 Rs. 84,000
Utilities Rs. 28,800 Rs. 30,000 Rs. 30,000
Accounting/bookeeping Rs. 6,500 Rs. 9,000 Rs. 9,000
Insurance Rs. 14,400 Rs. 14,400 Rs. 14,400
Payroll Taxes Rs. 0 Rs. 0 Rs. 0
Other Rs. 38,000 Rs. 45,000 Rs. 45,000

Total Operating Expenses Rs. 456,300 Rs. 593,600 Rs. 617,600
Profit Before Interest and Taxes Rs. 114,124 Rs. 130,839 Rs. 302,437
EBITDA Rs. 121,324 Rs. 138,039 Rs. 309,637
Interest Expense Rs. 16,250 Rs. 16,400 Rs. 14,650
Taxes Incurred Rs. 29,362 Rs. 34,332 Rs. 86,336
Net Profit Rs. 68,512 Rs. 80,107 Rs. 201,451

Net Profit/Sales 2.76% 2.54% 5.04%
7.5 Projected Balance Sheet

All of our tables will be updated monthly to
reflect past performance and future assumptions.
Future assumptions will not be based on past
performance but rather on economic cycle activity,
regional industry strength, and future cash flow
possibilities. We expect solid growth in net worth
beyond the year 2010.
The following table shows the Projected Balance

Sheet for Deity Retail
Pro Forma Balance Sheet

Assets
Current Assets
Cash Rs. 357,649 Rs. 224,519 Rs. 262,994
Inventory Rs. 371,402 Rs. 471,680 Rs. 599,034
Other Current Assets Rs. 8,000 Rs. 8,000 Rs. 8,000
Total Current Assets Rs. 737,050 Rs. 704,199 Rs. 870,027
Long-term Assets
Long-term Assets Rs. 72,000 Rs. 72,000 Rs. 102,000
Accumulated Depreciation Rs. 7,200 Rs. 14,400 Rs. 21,600
Total Long-term Assets Rs. 64,800 Rs. 57,600 Rs. 80,400
Total Assets Rs. 801,850 Rs. 761,799 Rs. 950,427
Liabilities and Capital Year 1 Year 2 Year 3
Current Liabilities
Accounts Payable Rs. 428,518 Rs. 242,359 Rs. 302,537
Current Borrowing Rs. 20,000 Rs. 13,000 Rs. 0
Other Current Liabilities Rs. 10,000 Rs. 10,000 Rs. 10,000

Subtotal Current Liabilities Rs. 458,518 Rs. 265,359 Rs. 312,537
Long-term Liabilities Rs. 150,000 Rs. 145,000 Rs. 135,000

Total Liabilities Rs. 608,518 Rs. 410,359 Rs. 447,537
Paid-in Capital Rs. 374,000 Rs. 452,000 Rs. 452,000

(Rs. (Rs.
Retained Earnings (Rs. 150,561)
249,180) 180,668)
Earnings Rs. 68,512 Rs. 80,107 Rs. 201,451
Total Capital Rs. 193,332 Rs. 351,439 Rs. 502,891
Total Liabilities and Capital Rs. 801,850 Rs. 761,799 Rs. 950,427
Net Worth Rs. 193,332 Rs. 351,439 Rs. 502,891
7.6 Business Ratios

We expect our net profit margin and gross
margin, to increase steadily over the three-year
period. Our net working capital will increase
handsomely by year three, proving that we have the
cash flows to remain a going concern. The following
table shows these important financial ratios.
We are using the industry standard business

ratios for independent convenience store chains as
a comparison to our own. There are some significant
differences between the two since we have a
completely different storefront than our
competitors. In addition, we expect higher
percentages in inventory as we will be operating
only one store initially and even many independent
convenience store owners often have two or more
facilities. Our long-term assets are low since we are
only renting our facilities.

Ratio Analysis
Year 1 Year 2 Year 3 Industry Profile
Sales Growth 0.00% 27.00% 27.00% 2.27%
Percent of Total Assets

Inventory 46.32% 61.92% 63.03% 22.18%
Other Current Assets 1.00% 1.05% 0.84% 26.81%
Total Current Assets 91.92% 92.44% 91.54% 56.12%
Long-term Assets 8.08% 7.56% 8.46% 43.88%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabilities 57.18% 34.83% 32.88% 26.39%

Long-term Liabilities 18.71% 19.03% 14.20% 24.87%
Total Liabilities 75.89% 53.87% 47.09% 51.26%
Net Worth 24.11% 46.13% 52.91% 48.74%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 23.00% 23.00% 23.00% 23.55%
Selling, General & Administrative Expenses 20.26% 20.10% 17.78% 16.21%
Advertising Expenses 0.00% 0.00% 0.00% 0.85%
Profit Before Interest and Taxes 4.60% 4.15% 7.56% 1.02%
Main Ratios
Current 1.61 2.65 2.78 1.68
Quick 0.80 0.88 0.87 0.71
Total Debt to Total Assets 75.89% 53.87% 47.09% 4.63%
Pre-tax Return on Net Worth 50.63% 32.56% 57.23% 57.28%
Pre-tax Return on Assets 12.21% 15.02% 30.28% 10.83%
Additional Ratios Year 1 Year 2 Year 3

Net Profit Margin 2.76% 2.54% 5.04%
Return on Equity 35.44% 22.79% 40.06%
Activity Ratios
Inventory Turnover 10.91 5.75 5.75
Accounts Payable Turnover 6.06 12.17 12.17
Payment Days 27 42 27
Total Asset Turnover 3.09 4.13 4.21
Debt Ratios
Debt to Net Worth 3.15 1.17 0.89
Current Liab. to Liab. 0.75 0.65 0.70
Liquidity Ratios
Net Working Capital Rs. 278,532 Rs. 438,839 Rs. 557,491
Interest Coverage 7.02 7.98 20.64
Additional Ratios
Assets to Sales 0.32 0.24 0.24
Current Debt/Total Assets 57% 35% 33%
Acid Test 0.80 0.88 0.87
Sales/Net Worth 12.83 8.96 7.95
Dividend Payout 0.00 0.00 0.25
Appendix

Personnel Plan
Month Month Month Month Month Month Month Month Month Month Month Month
1 2 3 4 5 6 7 8 9 10 11 12
0 Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs.
Mr. Bean
% 3,500 3,500 3,500 3,500 3,500 3,500 3,500 3,500 3,500 3,500 3,500 3,500
Mrs. Tuck
% 3,500 3,500 3,500 3,500 3,500 3,500 3,500 3,500 3,500 3,500 3,500 3,500
Mr. Takeda
% 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500
Office 0 Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs.
manager % 1,700 1,700 1,700 1,700 1,700 1,700 1,700 1,700 1,700 1,700 1,700 1,700
Technicians
% 1,500 1,500 1,500 1,500 1,500 1,500 3,000 3,000 4,500 4,500 4,500 4,500
Total People 5 5 5 5 5 5 6 6 7 7 7 7
Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs.
Rs.
Total Payroll 12,70 12,70 12,70 12,70 12,70 12,70 14,20 14,20 15,70 15,70 15,70
15,700
0 0 0 0 0 0 0 0 0 0 0
General Assumptions
1 2 3 4 5 6 7 8 9 10 11 12
Plan
1 2 3 4 5 6 7 8 9 10 11 12
Month
Current
10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00
Interest
% % % % % % % % % % % %
Rate
Long-
term 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00
Interest % % % % % % % % % % % %
Rate
Tax 30.00 30.00 30.00 30.00 30.00 30.00 30.00 30.00 30.00 30.00 30.00 30.00
Rate % % % % % % % % % % % %
Other 0 0 0 0 0 0 0 0 0 0 0 0
Pro Forma Profit and Loss

Mont Mont Mont Month Month Month Month Month Month Month Month Month
h1 h2 h3 4 5 6 7 8 9 10 11 12
Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs.
Sales 71,00 83,78 98,86 116,6 137,6 162,4 191,6 226,1 266,8 314,9 371,6 438,4
0 0 0 55 53 31 68 69 79 17 02 91
Direct Cost of
54,67 64,51 76,12 89,82 105,9 125,0 147,5 174,1 205,4 242,4 286,1 337,6
Sales
0 1 3 5 93 72 85 50 97 86 34 38
Other Costs of
Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0
Goods
Total Cost of
54,67 64,51 76,12 89,82 105,9 125,0 147,5 174,1 205,4 242,4 286,1 337,6
Sales
0 1 3 5 93 72 85 50 97 86 34 38
Gross Margin 16,33 19,26 22,73 26,83 31,66 37,35 44,08 52,01 61,38 72,43 85,46 100,8
0 9 8 1 0 9 4 9 2 1 9 53
23.00 23.00 23.00 23.00 23.00 23.00 23.00 23.00 23.00 23.00 23.00 23.00
Gross Margin %
% % % % % % % % % % % %
Expenses

Payroll 12,70 12,70 12,70 12,70 12,70 12,70 14,20 14,20 15,70 15,70 15,70 15,70
0 0 0 0 0 0 0 0 0 0 0 0
Sales and
Marketing and
5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000
Other Expenses
Depreciation
600 600 600 600 600 600 600 600 600 600 600 600
Leased Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs.
equipment 4,000 4,000 4,000 4,000 4,000 4,000 4,000 4,000 4,000 4,000 4,000 6,000
Rent
7,000 7,000 7,000 7,000 7,000 7,000 7,000 7,000 7,000 7,000 7,000 7,000
Utilities
2,400 2,400 2,400 2,400 2,400 2,400 2,400 2,400 2,400 2,400 2,400 2,400
Accounting/booke Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs.
eping 500 500 500 500 500 500 500 500 500 500 750 750
Insurance
1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200
15
Payroll Taxes Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0
%
Rs.
Other 10,00
2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 3,000 4,000 5,000
0
Total Operating
35,40 35,40 35,40 35,40 35,40 35,40 36,90 36,90 39,40 40,40 41,65 48,65
Expenses
0 0 0 0 0 0 0 0 0 0 0 0
Profit Before (Rs. (Rs. (Rs. Rs. Rs. Rs.

Rs. Rs.
(Rs. (Rs. Rs. Rs.
Interest and 19,07 16,13 12,66 15,11 21,98 32,03
43,81 52,20
8,569) 3,740) 1,959 7,184
Taxes 0) 1) 2) 9 2 9 1 3
(Rs. (Rs. (Rs. Rs. Rs. Rs.
Rs. Rs.
(Rs. (Rs. Rs. Rs.
EBITDA 18,47 15,53 12,06 15,71 22,58 32,63
44,41 52,80
7,969) 3,140) 2,559 7,784
0) 1) 2) 9 2 9 1 3
Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs.
Rs. Rs.
Interest Expense
958 1,375 1,375 1,375 1,375 1,375 1,375 1,375 1,417 1,417
1,417 1,417
(Rs. (Rs. (Rs. Rs. Rs.
(Rs. (Rs. Rs. Rs. Rs. Rs. Rs.
Taxes Incurred 6,008 5,252 4,211 12,72 15,23
2,983) 1,534) 175 1,743 4,123 6,170 9,184
) ) ) 1 6
(Rs. (Rs. (Rs. Rs. Rs. Rs. Rs.

(Rs. (Rs. Rs. Rs. Rs.
Net Profit 14,02 12,25 9,826 14,39 21,43 29,68 35,55
6,961) 3,580) 409 4,066 9,621
0) 4) ) 6 0 1 0
- - -
- -
Net Profit/Sales 19.75 14.63 9.94 0.25% 2.12% 4.25% 5.39% 6.80% 7.99% 8.11%
5.97% 2.60%
% % %
Pro Forma Cash Flow

1 2 3 4 5 6 7 8 9 10 11 12
Cash
Received
Cash from
Operations
Cash Sales 71,00 83,78 98,86 116,6 137,6 162,4 191,6 226,1 266,8 314,9 371,6 438,49
0 0 0 55 53 31 68 69 79 17 02 1
Subtotal Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs.
Cash from 71,00 83,78 98,86 116,6 137,6 162,4 191,6 226,1 266,8 314,9 371,6 438,49
Operations 0 0 0 55 53 31 68 69 79 17 02 1

Additional
Cash
Received
Sales Tax,
VAT, 0.00
HST/GST %
Received
New
Rs.
Current Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0
5,000
Borrowing
New Other
Liabilities
(interest-
free)
New Long- Rs.
term Rs. 0 50,00 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0
Liabilities 0
Sales of
Other
Current
Assets
Sales of
Long-term Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0
Assets
New Rs.
Rs.
Investmen Rs. 0 Rs. 0 Rs. 0 Rs. 0
50,00 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0
4,000
t Received 0
Cash 71,00 133,7 98,86 116,6 187,6 162,4 191,6 226,1 271,8 314,9 371,6 442,49
Received 0 80 0 55 53 31 68 69 79 17 02 1
Expenditur Month Month Month Month Month Month Month Month Month Month Month Month
es 1 2 3 4 5 6 7 8 9 10 11 12
Expenditur
es from
Operations
Cash Rs.
12,70 12,70 12,70 12,70 12,70 12,70 14,20 14,20 15,70 15,70 15,70
Spending 15,700
0 0 0 0 0 0 0 0 0 0 0
Bill
12,06 120,9 94,04 108,7 126,0 146,5 170,6 198,6 232,2 272,2 319,7 375,95
Payments
2 14 5 34 66 18 37 80 93 39 34 5
Spent on 24,76 133,6 106,7 121,4 138,7 159,2 184,8 212,8 247,9 287,9 335,4 391,65
Operations 2 14 45 34 66 18 37 80 93 39 34 5
Additional
Cash
Spent
Sales Tax,
VAT,
HST/GST
Paid Out
Principal
Repaymen
t of Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0
Current
Borrowing
Other Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0
Liabilities

Principal
Repaymen
t
Long-term
Liabilities
Principal Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0
Repaymen
t
Purchase
Other
Current
Assets
Purchase
Long-term Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0
Assets
Dividends Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0 Rs. 0
Cash 24,76 133,6 106,7 121,4 138,7 159,2 184,8 212,8 247,9 287,9 335,4 391,65
Spent 2 14 45 34 66 18 37 80 93 39 34 5
Rs. Rs. Rs. Rs. Rs. Rs.

Net Cash Rs. (Rs. (Rs. Rs. Rs. Rs.
46,23 48,88 13,28 23,88 26,97 36,16
Flow 166 7,885) 4,779) 3,212 6,831 50,835
8 7 9 6 9 8
Cash
160,0 160,2 152,3 147,5 196,4 199,6 206,4 219,7 243,6 270,6 306,8 357,64
Balance
58 25 40 61 48 61 92 80 67 45 13 9
Pro Forma Balance Sheet

1 2 3 4 5 6 7 8 9 10 11 12
Startin
g
Assets
Balanc
es
Current
Assets
Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs.
Cash 113,82 160,0 160,2 152,3 147,5 196,4 199,6 206,4 219,7 243,6 270,6 306,8 357,64
0 58 25 40 61 48 61 92 80 67 45 13 9
Rs.
Inventory 60,13 70,96 83,73 98,80 116,5 137,5 162,3 191,5 226,0 266,7 314,7 371,40
10,000
7 2 5 7 92 79 43 65 47 35 47 2
Other
Current
8,000 8,000 8,000 8,000 8,000 8,000 8,000 8,000 8,000 8,000 8,000 8,000 8,000
Assets
Total Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs.
Current 131,82 228,1 239,1 244,0 254,3 321,0 345,2 376,8 419,3 477,7 545,3 629,5 737,05
Assets 0 95 86 74 68 40 39 35 45 13 80 61 0
Long-
term
Assets
Long- Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs.
Rs. Rs.
term 72,00 72,00 72,00 72,00 72,00 72,00 72,00 72,00 72,00 72,00 72,00
72,000 72,000
Assets 0 0 0 0 0 0 0 0 0 0 0
Accumula
ted Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs.
Rs. 0
Depreciat 600 1,200 1,800 2,400 3,000 3,600 4,200 4,800 5,400 6,000 6,600 7,200
ion

Total
Long- Rs. Rs.
71,40 70,80 70,20 69,60 69,00 68,40 67,80 67,20 66,60 66,00 65,40
term 72,000 64,800
0 0 0 0 0 0 0 0 0 0 0
Assets
Total
203,82 299,5 309,9 314,2 323,9 390,0 413,6 444,6 486,5 544,3 611,3 694,9 801,85
Assets
0 95 86 74 68 40 39 35 45 13 80 61 0
Liabilities
and
1 2 3 4 5 6 7 8 9 10 11 12
Capital
Current
Liabilities
Accounts Rs.
117,7 90,44 104,5 121,2 140,8 164,0 190,9 223,2 261,6 307,2 361,1 428,51
Payable 8,000
95 0 54 09 62 52 81 71 43 80 79 8
Current Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs.
Rs. Rs.
Borrowin 15,00 15,00 15,00 15,00 15,00 15,00 15,00 15,00 20,00 20,00 20,00
15,000 20,000
g 0 0 0 0 0 0 0 0 0 0 0
Other Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs.
Rs. Rs.
Current 10,00 10,00 10,00 10,00 10,00 10,00 10,00 10,00 10,00 10,00 10,00
10,000 10,000
Liabilities 0 0 0 0 0 0 0 0 0 0 0
Rs.
Current 142,7 115,4 129,5 146,2 165,8 189,0 215,9 248,2 291,6 337,2 391,1 458,51
33,000
Liabilities 95 40 54 09 62 52 81 71 43 80 79 8
Long- Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs.
term 100,00 100,0 150,0 150,0 150,0 150,0 150,0 150,0 150,0 150,0 150,0 150,0 150,00
Liabilities 0 00 00 00 00 00 00 00 00 00 00 00 0
Total
133,00 242,7 265,4 279,5 296,2 315,8 339,0 365,9 398,2 441,6 487,2 541,1 608,51
Liabilities
0 95 40 54 09 62 52 81 71 43 80 79 8
Paid-in
320,00 320,0 320,0 320,0 320,0 370,0 370,0 370,0 370,0 370,0 370,0 370,0 374,00
Capital
0 00 00 00 00 00 00 00 00 00 00 00 0
(Rs. (Rs. (Rs. (Rs. (Rs. (Rs. (Rs. (Rs. (Rs. (Rs. (Rs. (Rs. (Rs.
Retained
249,18 249,1 249,1 249,1 249,1 249,1 249,1 249,1 249,1 249,1 249,1 249,1 249,18
Earnings
0) 80) 80) 80) 80) 80) 80) 80) 80) 80) 80) 80) 0)
(Rs. (Rs. (Rs. (Rs. (Rs. (Rs. (Rs. (Rs. (Rs. Rs.
Rs. Rs.
Earnings Rs. 0 14,02 26,27 36,10 43,06 46,64 46,23 42,16 32,54 18,15 32,96
3,280 68,512
0) 4) 0) 1) 1) 2) 6) 5) 0) 2
Total Rs.
56,80 44,54 34,72 27,75 74,17 74,58 78,65 88,27 102,6 124,1 153,7 193,33
Capital 70,820
0 6 0 9 9 8 4 5 70 00 82 2
Total
Liabilities
203,82 299,5 309,9 314,2 323,9 390,0 413,6 444,6 486,5 544,3 611,3 694,9 801,85
and
0 95 86 74 68 40 39 35 45 13 80 61 0
Capital
Net Rs.
56,80 44,54 34,72 27,75 74,17 74,58 78,65 88,27 102,6 124,1 153,7 193,33
Worth 70,820
0 6 0 9 9 8 4 5 70 00 82 2

Business Plan: Institute of Management Sciences Lucknow University

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Business Plan

Deity Retail Store Owner- Amar Kumar Gupta 1

Owner- Amar Kumar Gupta

Deity Retail Store Owner- Amar Kumar Gupta 2

Deity Retail Store Owner- Amar Kumar Gupta 3

Deity Retail Store Owner- Amar Kumar Gupta 4

Deity Retail has access to the purchasing power

Deity Retail Store Owner- Amar Kumar Gupta 5

Deity Retail attracts its customers through the

A Grand Opening will commence after Deity

The storeowner of Deity Retail has access to

According to the information contained in this

Deity Retail Store Owner- Amar Kumar Gupta 6

All products will be locally or nationally branded

In addition, the company is looking into ways to

Deity Retail Store Owner- Amar Kumar Gupta 7

Convenience stores serve the entire purchasing

Our main competitor is Spencer which holds

Deity Retail will be receiving periodic influxes of

Deity Retail Store Owner- Amar Kumar Gupta 8

• Achieve profitability by July Year 1;

Deity Retail Store Owner- Amar Kumar Gupta 9

Deity Retail will cater to residents, businesses,

The Deity Retail Store provides a variety of

Deity Retail Store Owner- Amar Kumar Gupta 10

Deity Retail's primary objective is to create a

Our mission is to provide the Gomtinagar area

The Deity Retail Store will provide residents and

Our most fundamental philosophy is the

We believe that our responsibility for customer

Deity Retail Store Owner- Amar Kumar Gupta 11

Our philosophy of concern for people gives our

We at Deity Retail Store of Gomtinagar, are

1.3 Keys to Success

Deity Retail Store Owner- Amar Kumar Gupta 12

To succeed in this business we must:

• Sell a broad range of products.

Service and Convenience are the keys to success

Deity Retail Store Owner- Amar Kumar Gupta 13

• Prepaid account facility in which a registered

2.0 Company Summary

Deity Retail will rent a 3,000-square-foot space,

Since the selected location is in the heart of one

Deity Retail Store Owner- Amar Kumar Gupta 14

2.1 Hours of Operation

2.2 Company Ownership

2.3 Start-up Summary

Deity Retail Store Owner- Amar Kumar Gupta 15

Start-up Funding Plan

Deity Retail Store Owner- Amar Kumar Gupta 16

The Deity Retail Store will offer the top 31 best-

The store will sell over 3,000 private label and

As the most progressive company in the

Deity Retail will sell the same products as other

Deity Retail Store Owner- Amar Kumar Gupta 17

The Deity Retail Store sells a variety of quality

The merchandise is purchased from a variety of

We are able to sell products at very low prices,

Deity Retail Store Owner- Amar Kumar Gupta 18

The product listing takes into account regularly

Deity Retail Store Owner- Amar Kumar Gupta 19

2. Free home delivery at minimum order of Rs 400