Entrepreneurship

Term Report

Arco Baleno

Course Instructor:
S
Date: June
 Group Members:
Fahim Afridi
Tahir Usman

Class: MBA-V

ACKNOWLEDGEMENTS
We would like to express our gratitude to everyone who supported us throughout the
project.
Firstly, we would like to thank Almighty Allah who gave us the strength and
determination to complete this project.
We would also like to M. ALI. SHIEKH, for giving us an opportunity to make a realistic
business plan which would help us to open our own business in the future.
Finally, we would like to thank our families and peers who were a source of immense
support, and without their assistance this report would not have been possible.

EXECUTIVE SUMMARY
The purpose of this report is to explain, assess, analyze and put forward the idea of
opening a retail store, based on division of different color sections, so that women can
find matching clothes and accessories for the color they desire under one roof. By doing
this we provide our customers convenience so that they don’t have to rush to different
places. The report describes the details of the organization structure and administrative
obligations along with the market analysis resulting into formation of marketing
strategies and the basic financial plan.

This store would be one of its kinds as there is no such store in Pakistan, let alone
Karachi. This report describes the strengths and weaknesses of the concept and how
realistic can it be. This concept itself is the USP of our store. From the name of the
company to the company logo and tagline everything is deliberated in a way that it
reflects the USP of our store and has a meaning behind it. This would help in crafting an
image in the mind of the potential customers about what is being offered.

Arco Baleno is a partnership firm comprising of five partners with their names being;
Waqar Abbas, Muammad Fawad Iqbal, Fahim Afridi . This project requires an initial
investment of Rs. 1,085,634. The profits would be divided amongst the partners equally
in accordance with their equal investments. As the store is targeting women the partners
can identify, understand and relate to customer’s requirements and how these can be
fulfilled. The partners themselves come under the target market thus giving them not only
an edge over others but also giving them more opportunities to observe the buying
patterns of potential customers and interacting with them and taking feedback which
could help in formation of more lucrative strategies and keeping the business up to date.
The partners have put up a stall before, on a small scale, where they sold women
accessories and jewelry of their choice which was very successful and the feedback given
was encouraging and appreciated by women.

In this report it has been evaluated what are the barriers of entry into this market and
what kind of competition we will face. To ensure if our concept is relatable to the
potential customers we conducted a market research by conducting surveys so that we
can observe the buying patterns of our potential customers and get to know about the
present market trends. This helped us understand what our customers might be expecting
from us and how can we get a certain edge over our competitors. This also helped us in
deciding our product prices. We also performed different analysis to identify the
problems that the business might face. We plan to make such investments that the
business should remain saleable if the business fails in future and the partners are able to
sell it off and divide the amount according to their share of investments.

TABLE OF CONTENTS
ACKNOWLEDGEMENTS.................................................................................................2
EXECUTIVE SUMMARY.................................................................................................3
TABLE OF CONTENTS.....................................................................................................5
COMPANY HISTORY TO DATE.....................................................................................7
LOGO..............................................................................................................................7
TAGLINE: Choose your part of the rainbow!.................................................................8
OPERATIONS.................................................................................................................8
LEGAL ENTITY & PARTNERSHIP.............................................................................8
 PARTNERSHIP DEED...................................................................................................8
STAFF MEMBERS.......................................................................................................11
LOCATION...................................................................................................................11
KEY ASSETS................................................................................................................12
FEATURES & BENEFITS...........................................................................................13
PRE-LAUNCH..................................................................................................................13
INDUSTRIAL ANALYSIS...............................................................................................13
COMPETITION............................................................................................................13
COMPETITIVE ADVANTAGE/BARRIERS TO ENTRY.........................................14
DEVELOPMENT..........................................................................................................14
SUPPLIERS...................................................................................................................15
MARKET RESEARCH.................................................................................................16
SURVEY RESULTS.....................................................................................................17
MARKET ANALYSIS..................................................................................................30
CUSTOMER ANALYSIS.............................................................................................30
TARGET CUSTOMER.................................................................................................32
MARKET SIZE.............................................................................................................32
TRENDS........................................................................................................................32
PEST ANALYSIS.........................................................................................................33
SWOT ANALYSIS.......................................................................................................34
MISSION.......................................................................................................................36
STRATEGY & IMPLEMENTATION..........................................................................37
PHILOSOPHY...............................................................................................................37
PRODUCT DEVELOPMENT......................................................................................37
INTERNET STRATEGY..............................................................................................38
MARKETING STRATEGY..........................................................................................38
MARKETING MIX.......................................................................................................39
SOCIAL ENTREPRNEURSHIP...................................................................................42
LAUNCH ..........................................................................................................................45
POST-LAUNCH................................................................................................................46
FINANCIALS, BUDGETS & FORECASTS...............................................................46
SALES FORECAST......................................................................................................46
SALES STRATEGY.....................................................................................................50
EXPENSES....................................................................................................................51
Working for each product’s first monthly expenses......................................................54
FUNDS REQUIRED.....................................................................................................56
INCOME STATEMENT PROJECTIONS....................................................................57
CASH FLOW PROJECTIONS.....................................................................................60
BREAK EVEN..............................................................................................................60
BALANCE SHEET.......................................................................................................61
ASSUMPTIONS............................................................................................................61
CONTROLS..................................................................................................................61
MILESTONES...............................................................................................................61
EXIT STRATEGY & CONTINGENCY PLANNING.................................................62
CONCLUSION..................................................................................................................62
REFERENCES..................................................................................................................63
APPENDIX A....................................................................................................................64
ENTREPRENEURSHIP QUESTIONNAIRE..............................................................64

COMPANY HISTORY TO DATE

Arco Baleno is an Italian word that means ‘Rainbow’ in English. It is a retail store, which
is divided into different color sections, offering women, a complete range of clothes and
their matching accessories under one roof. The owners of the company felt a need to open
this retail sore, as Karachiites females have a very busy schedule and they often find it
difficult to search for matching accessories with their clothes under one roof. Arco
Baleno will not only provide females with clothes/shoes/accessories, but also with our
trained staff who will also counsel customers that which color and design suits them the
best, and which accessories complements their clothes and personalities.

LOGO
TAGLINE: Choose your part of the rainbow!
Arco Baleno’s tagline is “Choose your part of the rainbow!” As we are offering clothes
with matching shoes and accessories in different colors thus; providing customers with
the convenience to buy whatever product required in whichever color they want.

OPERATIONS
As a retail store, Arco Baleno will operate 6 days a week (excluding Sundays) from 10
a.m. to 9 p.m. on weekdays and from 11 a.m. to 11 p.m. on weekends. During special
occasions like Eid, store hours will be extended. All the partners will be present at Arco
Baleno mostly at all times.

To keep a track of inventory so we do not run out of stock and to control costs, an
inventory control system will be installed. This will include bar-coding and related
equipments and software. The sales staff will also conduct annual inventory audits.

LEGAL ENTITY & PARTNERSHIP

Arco Baleno is a partnership firm currently managed by five partners which will be
looking after the following departments:

Partner’s name Position Contact number

Fahim Afridi Finance head 0301-5000888
Waqar Abbas Sales head 034592666552
Fawad Iqbal Human Resources head

Arco Baleno’s expenditures will be financed by 65% by partners’ investments and 35%
by bank loan.

PARTNERSHIP DEED
Name of the Firm: “ARCO BALENO”
Nature of the Business: Arco Baleno is a ladies retail outlet, which is divided into
different color sections, offering women, a complete range of clothes and their matching
accessories under one roof.

Place/ Address of the business: Main Saba Avenue, showroom near Shamsheer

Amount Invested by each Partner:

Waqar Abbas Rs. 241,176
Fahim Afridi Rs. 141,176
Fawad Iqbal Rs. 141,176

Duration of the Partnership: 5 Years

Profit/Loss Sharing Ratio of the Partners:

Waqar Abbas 40%
Fahim Afridi 30%
M Fawad Iqbal 30%

Procedure of Admission of a new Partner: A new partner will only be admitted if all
existing partners mutually accept him/her. In addition, the new partner should at least
invest same amounts as others have done or more in the business.

A Provision of Dissolution of Firm: In this situation, all the partners with mutual
agreement will sell the business or sell individual assets and divide the money according
to each partner’s investments.

Rights, Duties and Liabilities of Partners:

Waqar Abbas - As the Finance head will be responsible for keeping track of all the
revenues and expenses of Arco Baleno.
Fahim Afridi - As a Sales head will keep a check of day to day operations and try to
enhance sales and customer satisfaction by supervising staff.

M Fawad Iqbal - As a Human resources head will be responsible for hiring and firing of
staff along with employees’ training.

Provision of the Retirement of Partner: In case of retirement of any partner, all the
remaining partners with mutual agreement will give the retired partner his/ her share of
investment.

Provision of the Method of Settlement of Disputes: In case of disputes, all the partners
with mutual agreement will try to resolve the issue but if it will not resolve then all the
partners will mutually agree to dissolve the business and the amount will be distributed
equally among the partners with respect to their initial investments.

ORGANIZATIONAL STRUCTURE

As Arco Baleno will start from a small scale, the staff will be small. Overall the partners
will be responsible for daily operations, overseeing marketing efforts, buying
merchandise and managing inventory and all other administrative duties. A small sales
staff will assist the partners with sales, assisting customers and general maintenance of
stock on the floor. The following are the partners’ duties:

Waqar Abbas will enhance our public relations with external stakeholders and ensure
superior marketing plans implemented.
Fahim Afridi will keep a check of day to day operations and try to enhance sales and M
Fawad Iqbal will be responsible for maintaining inventory and bookkeeping.
STAFF MEMBERS
Arco Baleno will hire 1 female employee per color section initially, which is a total of 6
employees in the store. They will be employed on a contract basis and they will be given
a fixed salary. Later we plan to give them commissions. Training will be given to our
sales staff which would not only enable them to sell more but also how to provide
customers with appropriate fashion advice. Bonuses will be provided with each year of
service after the company has started making profits, following an annual review to
encourage employee retention.

LOCATION
We have identified an ideal spot for Arco Baleno’s location, which is at Main Saba
Avenue, showroom near Shamsheer. It’s a double storey building and the area it occupies
is 900 square feet per floor. Previously, the building was rented to Nadia Lankandwala
(famous Pakistani fashion designer); therefore, it is in a very good condition. It is well
equipped with fixtures and fittings, and has dressing rooms which are an advantage for us
as it reduces our cost.

Floor Plan

Ground Floor

Clothes Clothes Clothes

Jewellery, Purses

Jewellery, Purses

Jewellery, Purses
Shoes & Laces

Shoes & Laces

Shoes & Laces

Accessories

Accessories

Accessories
& Hair

& Hair

& Hair
Counter
Cash

Entrance
Stairs Door
First Floor

Clothes Clothes Clothes

Jewellery, Purses

Jewellery, Purses

Jewellery, Purses
Shoes & Laces

Shoes & Laces

Shoes & Laces

Accessories

Accessories

Accessories
& Hair

& Hair

& Hair
Dressing
Stairs Window Rooms

KEY ASSETS
Arco Baleno’s key assets are its owners, as all five of them are a part of the target market
of Arco Baleno and thus, are aware of the current fashion trends. This is an advantage for
Arco Baleno as it will make product decisions easier as they all realize the need that Arco
Baleno intends to fulfill. Once Arco Baleno is launched, our primary asset will be our
brand, which will convey style, quality and a great shopping experience for females. In
the long run it will be this brand that would separate Arco Baleno from other retailers
both locally as well as internationally.
FEATURES & BENEFITS
The key feature that separates Arco Baleno from other local retail stores is providing
customers with a complete range of clothes with its corresponding accessories/shoes
under one roof. Our prime goal is that our clients are satisfied with the style and design of
their purchase. In addition, we will make every effort to include accessories (shoes, bags,
jewelry) available at all sizes from petite to plus size versions.

Moreover, Arco Baleno will not only provide its customers with clothes and accessories
but, its clients will also benefit with an experienced and knowledgeable sales staff. Arco
Baleno’s main objective is to provide with better-quality customer service, friendly and
inviting atmosphere and also provide clients with fashion information and advice. Arco
Baleno will ensure that every customer is satisfied with what they purchase.

PRE-LAUNCH

INDUSTRIAL ANALYSIS

COMPETITION
In Karachi and even in Pakistan, there are no direct competitors offering our unique
services or providing apparel, accessories and shoes under one roof in different color
sections. A few shops most closely competing with Arco Baleno are as follows:
• Khaadi, one of our closest competitors targets women within our target demographic
as well, but specializes in hand-woven fabrics, garments, home products and
accessories.
• GulAhmed’s target market includes our target demographic as well. But its main
focus is its fabric and its major disadvantage is that it does not offer a variety of its
other product ranges.
• Maria B is a manufacturer and retailer of women’s fashion garments. It targets
women and overlaps our target demographic however; its products are not affordable
 by all. It offers stitched clothes and thus, do not provide the same product range as
ours.
• Cross Roads, specializes in offering industrial chic clothing. It is our competitor in
terms of accessories but as far as apparel is concerned, its offers western which is
completely different from our clothing line.

COMPETITIVE ADVANTAGE/BARRIERS TO ENTRY

Our major competitive advantage is the lack of any store like ours in Karachi. Though it
is very likely that a competitor will locate within our area soon but we believe in our
fashion sense, exceptional customer service and the good quality products we offer.
Gradually we will establish Arco Baleno as the place for women to shop.

Also, we would be the only fashion retail-store offering women merchandise under one
roof for old/young women. While other stores do offer some comparable fashion
products as ours but they do not offer complete women merchandise in one shop with
divided colored sections. We, therefore, have a distinct competitive advantage.

DEVELOPMENT
Quite a few opportunities will open to us, once are company starts growing, we establish
our brand and our store earns a positive reputation. And we are considering some options
already. Firstly, we will develop and grow our company by increasing existing clothing
lines and expanding our selection to include additional products such as western clothes
or lingerie. Secondly, we will sign contracts with renowned brands of Pakistan, such as
GulAhmed or Sana & Safinaz. Also, we will collaborate with foreign accessories brands,
such as, Claire’s or Aldo. Within five years, we will hopefully assess the potential for
opening our outlets in main areas of Karachi, such as, Tariq Road, Bahudrabad, etc. We
also see the potential for regional and/or national expansion at some point.
As we all are aware of the power and ease of an online storefront so we plan to develop
an online Arco Baleno store quickly and efficiently.

SUPPLIERS
Following are the addresses and contact details of Arco Baleno’s suppliers:

Clothes
Shazia’s Collection
C/215, Block 11,
P.E.C.H.S.
Karachi
0300-2066816

Shoes
Ahmed Shoes Co.
1st Floor, Karm Plaza,
Munshi Mohalla, St. No. 7,
Aminpur Bazar,
Faisalabad

Accessories
Model A Accessories
Banglow 28,
Block K, Phase 11,
Defense View Site,
Karachi
0321-2051471

MARKET RESEARCH
We did a market research in order to check our concept of offering all the ladies goods
from clothes to accessories under one roof. We used both the primary and secondary
research in order to testify our concept. We did primary research by conducting a survey
(distributed questionnaires) within Szabist premises and also got the questionnaires filled
by people outside Szabist. We also conducted secondary research by observing
entrepreneurship reports in the library. Apart from that we got information from different
websites related to the current market trends and our competitor’s latest offering. This all
helped us in getting to know our potential customers and gave us knowledge about our
customer’s choices/preferences and their buying behavior.

An important part of our research will be researching about the competition so that we
find out who else offers the same products as ours in our area. Apart from this we will
visit our competitors’ stores and websites, talk to their customers and buy something
from our competitors, and will get on their mailing lists so that we will be aware of their
sales and other promotional activities.
SURVEY RESULTS
If a new shop which has apparel/accessories/shoes,
divided on the basis of colors available under one roof
would you visit it?

50

Respondents Non Respondents

Analysis: 50 females of Karachi out of 57, that is 88% said that they would visit Arco
Baleno and thus we have decided to proceed with our concept.
 Location
20 19
18
16
14
12 11
10
8
6 5
4
4 3 2
2
1 1 1 1
2
0
P.E.C.H.S
Tariq Road

Nazimabad

No Response
Cantt
Gulshan

Garden
Gulistan-e-johar
Clifton

Defense

Bahadurabad

Analysis: 9 out of 50 respondents who live in Defense and the rest 31 who do not live in
Defense, all agreed to visit Arco Baleno which shows that females from whole Karachi
irrespective of their residential areas will come to visit Arco Baleno.
Age
20 17
15 13 12
10 8
5
0
15-20 20-25 25-30 30 & Above

Analysis: The survey conducted demonstrated that, out of 50 females 17 of them were
between the age bracket of 20-25.Where as, 13 of them between the age bracket of 25-30,
8 of them between the age bracket of 15-20, and, rest of them between the age bracket of
30 and above. This means that the survey results should be appropriate as we have
covered all age brackets of our target market.
 How often do you shop?

30
22
18
20
10
10

0
Weekly Monthly Ocassionally

Analysis: Out of 50 females, majority of them said that they did their shopping monthly.
While 18 of them respondent occasionally, and 10 of them said that they shopped weekly
this shows that there is a chance that females will visit Arco Baleno at least monthly.

How many hours do you spend on

shopping in one time?
27
30

20
11 10
10 2

0
1 hour 3 hours 5 hours Other

Analysis: According to our survey out of 50 females, 27 of them spend at least 3 hours
for shopping. While 11 of them spend 1 hour and 10 of them spend 5 hours. This shows
that women do not get what they desire to shop in less than an hour. Therefore, Arco
Baleno would provide females clothes/apparel/accessories under one roof, so that women
can save traveling time and can shop easily.
 Will you prefer shopping for clothes
and accessories under one roof?
7

Yes
No

43

Analysis: 86 percent, of the females were in favor of shopping for

clothes/apparel/accessories under one roof. While 14 percent were not. Since there is no
retail store as such operating in Karachi, that provides clothes/apparel/accessories under
one roof, thus this would lead to more footfalls in Arco Baleno.

Will shopping be convenient for you if

the shop is divided into different
colored sections?

41
50

0
Yes No

Analysis: Out of 50 females, majority of them thought that shopping would be more
convenient for them, if a shop is divided into different color sections as they have
difficulty in finding there matching’s. While, only nine of them rejected this thought.
Thus, this illustrate that females would visit Arco Baleno, as it would provide them
convenience.
 What is the best possible area for an
apparel/accessories/shoe store?

30
21 18
20 16
10
2
0
Clifton Defense Tariq Other
Road

Analysis: The survey of 50 females, illustrated that 21 females thought that, the possible
location to open a retail store of apparel/clothes/accessories, would be Clifton. While 18
suggested Defense and the rest thought Tariq road. Hence, as Arco Baleno is situated at
Saba Avenue, Defense therefore, females would visit this store.

How are you most likely to know about a new

apparel/accessories store?
1%
25% 21%

9%
44%

Billboards Internet Word of mouth New spapers/Magazines Other

Analysis: 44 percent of the females said that, they would most apparently know about
clothes/apparel/accessories through word of mouth by their friends and family. While 28
percent said that, they would most likely to know about a store through billboards, 12
percent would know through internet, and rest thought that, they would know through
newspaper/magazines. Thus Arco Baleno marketing would mostly be done by word of
mouth followed by billboards, internet and magazines.

Where do you normally shop for

apparel/accessories/shoes?
25
25 20
20 15
15
10
5
0
Branded

Stores in

is available
everything

under one
Stores

vicinity

Where
your

roof

Analysis: According to our survey, out of 50 females, 25 shops for

clothes/accessories/shoes in stores in their vicinities and as majority of females in our
sample reside in Clifton or Defense, they will visit Arco Baleno. 20 females shop where
everything is available under one roof, while rest shops in branded stores. This illustrate
that, customers visiting Arco Baleno would mostly be people living in Clifton and
defense as, the retail store is situated at main Saba Avenue.

Your selection of
apparel/accessories/shoes depends
on:
38
40

20 11
5 3
0
Cheap Good Brand Other
price quality name

Analysis: Majority of females prefer products with good quality which Arco Baleno aims
to provide.
 What do you dislike about your
current shopping stores for
apparel/accessories/shoes?

30 21
20 11
6
10
0
Price Quality Variety

Analysis: 21 females do not like the variety, which is currently offered by

apparel/accessories/shoes store and thus, Arco Baleno will provide a wide range of
products for the customers to choose from. 11 females dislike the prices, and these
females will be satisfied by Arco Baleno by providing them with affordable prices.

According to you, where should the

prices start from for clothes?
15
15 14 14

10
6
5
1
0
Rs. 50 Rs. 100 Rs. 500 Rs. 700 Rs. 1000

Analysis: The survey conducted demonstrated that, most of the females would like to
have the clothes priced at Rs.500 or Rs.700 ad above, thus Arco Baleno has cloth prices
of Rs. 450 on average providing value to the customers.
 According to you, where should the
prices start from for jewelry?
14 15
15

10
9 9

5 3

0
Rs. 50 Rs. 100 Rs. 500 Rs. 700 Rs. 1000

Analysis: The marketing research conducted illustrated that, most of the females thought
that the prices of jewelry should begin from somewhere between Rs. 100 and Rs. 500.
Thus, Arco Baleno has priced (average) its jewellery from Rs. 190.

According to you, where should the

prices start from for shoes?
30 25
20
14
10 6 4
1
0
Rs. 50 Rs. 100 Rs. 500 Rs. 700 Rs. 1000

Analysis: The survey conducted of 50 females demonstrated, 25 females thought that, the
prices of shoes should start from Rs. 500. Arco Baleno will provide females shoes with
affordable prices that would be between Rs. 550-1000.
 According to you, where should the
prices start from for bags?
30
21
20 17

10
8
4
1
0
Rs. 50 Rs. 100 Rs. 500 Rs. 700 Rs. 1000

Analysis: Out of 50 females surveyed, most of them thought that the prices of bags
should start from between Rs. 100 and Rs. 500. Arco Baleno’s bags have an average
price of Rs. 400 which falls right in the range the customers want.

According to you, where should the

prices start from for hair accessories?

30
23
20 17

10 7
3
0
0
Rs. 50 Rs. 100 Rs. 500 Rs. 700 Rs. 1000

Analysis: The survey conducted of 50 females illustrated that, most of the females
thought that the prices of hair accessories should start from somewhere between Rs. 50
and Rs. 100. Arco Baleno has priced its hair accessories on an average price of 125 thus
many products starting from the prices that customers want.
 According to you, where should the
prices start from for laces?
30 24
19
20

10
4 2 1
0
Rs. 50 Rs. 100 Rs. 500 Rs. 700 Rs. 1000

Analysis: Out of 50 females, most of them respondent that, the prices of laces should
range from between Rs. 50 and Rs. 100. Thus, Arco Baleno’s average price for laces
which is around Rs. 95 is appropriate.

Lawn 13%

87%
Stitched Unstitched

Analysis: The survey conducted demonstrated that, 87 percent of the females preferred
buying lawn unstitched, where as only 13 percent preferred buying lawn stitched. Arco
Baleno will mostly provide its customers with unstitched clothes, which will also include
lawn; therefore females would visit the store.
 Silk

60 46

40
10
20

0
Stitched Unstitched

Analysis: According to the marketing research conducted, 46 females usually buy silk
clothes that are unstitched, while 10 of them purchase silk clothes unstitched. As a result
customers would visit Arco Baleno as it will also provide customers with variety of silk
unstitched clothes.

Cotton
38
40
30 17
20
10
0
Stitched Unstitched

Analysis: The survey illustrated that, 38 females usually purchase cotton clothes that are
unstitched, whereas 17 of them preferred buying cotton that is stitched. Arco Baleno will
offer its clients with variety of unstitched cotton clothes, but stitched would be of limited
edition. Therefore females would visit Arco Baleno as it would satisfy their needs.
 Formal Wear
33
34
32
29
30
28
26
Stitched Unstitched

Analysis: According to the survey conducted, 33 females preferred buying formal wear
clothes that are unstitched, 29 of them purchase formal wear clothes that are stitched.
Therefore, Arco Baleno will provide females with variety cotton, silk, lawn that are
unstitched, and will also offer its customer with stitched clothes but those would be in
limited edition.

Casual Wear

40 31
30 20
20
10
0
Stitched Unstitched

Analysis: The marketing research conducted illustrated that, 31 females preferred buying
casual clothes that are unstitched, while, 20 of them usually purchase casual clothes that
are stitched. Arco Baleno will offer females with variety of casual wear unstitched
clothes but stitched would be limited. Hence females would visit this store.
 Eid
28
30 23

20

10

0
Stitched Unstitched

Analysis: Our survey illustrated that, on Eid 28 females usually prefer buying clothes
that are unstitched. Whereas 23 of them purchased clothes that are stitched. This
illustrates that females would visit Arco Baleno on Eid, as it would provide them with
both stitched and unstitched clothes.

Weddings
28
30 23

20

10

0
Stitched Unstitched

Analysis: Our marketing research illustrated that, on weddings 28 females usually prefer
purchasing clothes that are unstitched. While, 23 females purchased clothes that are
stitched. Arco Baleno will also offer its customers with wedding clothes that are
unstitched as well as stitched clothes on order. Therefore, customer would visit Arco
Baleno on weddings months in order to buy wedding clothes.
 Parties
28
30 22

20

10

0
Stitched Unstitched

Analysis: The survey conducted illustrated that, 28 females preferred wearing party wear
stitched, while 22 of them purchase party wear clothes that are unstitched. This would be
disadvantage for Arco Baleno as it provides variety of unstitched clothes to females and
stitched clothes are in limited edition.

Would you prefer a play area in a

ladies apparel/accessories store?

40 32
19
20

0
Yes No

Analysis: 19 females preferred a play area in ladies apparel/accessories/shoe store, while

32 of them did not and thus, Arco Baleno will not have a play area in the store.

MARKET ANALYSIS

CUSTOMER ANALYSIS
Identify Arco Baleno’s customers:
The customers of Arco Baleno are Females (teenagers, young adults and adults) of
middle and high income groups.
Identify Arco Baleno’s customers’ needs:
Our customers want convenience in shopping. They need good quality products with
reasonable prices. They also require a variety of products under roof, therefore, this idea
of opening a women store with complete range of clothes and matching accessories under
one roof solves a big problem of female. Currently, they have to go to different places to
get matching accessories with their clothes.

Identify a place with respect to Arco Baleno’s customers’ convenience:

Mostly customers prefer shopping at places that are located in their vicinity and have
parking facility available. Arco Baleno’s outlet would exist at near the hub of shopping
zone (Zamzama). Also, Saba Avenue itself is one of the busiest streets of Defense. This
would ensure more footfalls and females of Defense and Clifton would conveniently shop
as they are our real target market.

How Arco Baleno’s products will satisfy its target market needs:
As our store will be divided into different color sections offering complete range of
clothes and matching accessories for women, this will solve a big problem of ladies as
they now don’t need to roam around for getting matching accessories with their clothes.

Identify the prices Arco Baleno’s customers are willing to pay:

As our target market is females, who are usually bargain seekers and want good quality
products at reasonable prices, therefore, all of our products lie within affordable price
ranges.

How would Arco Baleno position its product/service: Premium/Affordable?

We are offering affordable prices to our customers in order to increase our footfalls in the
initial stages and enhance our sales growth.
TARGET CUSTOMER
Arco Baleno is a business-to-consumer retail company. Our obvious target customers are
young females. Those born in the 70s and onwards are trendsetters whereas the older lot
is still a slightly more conservative. These will be the women in particular we will target
with our marketing and offerings. According to the survey as well it was apparent that
they value uniqueness, convenience, service and quality. However, we will most likely
attract older women with our apparel collection and shoes. It’s important that we do not
only offer products that are exclusive to the younger audience.

MARKET SIZE
Karachi accommodates a robust retail market. The main local shopping district is at Tariq
Road and Zamzama with tree-lined streets and appealing shops and restaurants. This
retail district is the social and shopping hub of the community.

The current population of Karachi is around 12,827,927. About 5,798,087 of this

population are women. From this population of women in Karachi approximately two-
thirds live in the urban area, most of whom are young females who we hope to target.
In addition to local consumers, we will also benefit from tourist traffic. As Karachi is one
of the major and largest cities of Pakistan so it brings several thousands of our target
consumers into the area each year.

TRENDS
The ladies wear patrons are more sophisticated today relatively to yesterday in a number
of ways.
• Quality Products: The preference for high-quality products is increasing as customers
are learning to appreciate the qualitative differences.
• Presentation/appearance: Fixated customer attention is necessary in today’s
competitive world, hence, in order to create attraction towards products they have to
be presented in a striking way.

The retail fashion industry is a business with ever-changing styles and persistent
consumer demand. As malls ruled the past two decades so now more and more
consumers are looking for change. They’re searching for a more peaceful, convenient and
customer-friendly shopping experience. As the women of today do not have time to run
to different stores so they prefer getting everything under one roof. Though malls do exist
but nowadays malls are getting bigger and bigger and creating the same problem. Arco
Baleno will solve this problem of females to a great extent.

The fashion industry in Pakistan has been flourishing since the start of moving pictures.
Clothing and other fashion products will always be in high demand as the population of
women in Pakistan is rising.

PEST ANALYSIS
Political: Government policies greatly affect the profitability of any business and so it
will also affect Arco Baleno. If government increases the interest rate, the prices of Arco
Baleno products will also increase and it will not be able to offer reasonable prices to its
customers which will directly affect its sales growth. Moreover, the increase in import
duties will also affect the global expansion of our business in future.

Economical: The economic conditions have a huge impact on the buying power of Arco
Baleno’s customers. Moreover, Arco Baleno is not only facing competition locally but
also from international market hence, it has to offer value of money to its customers so
that the sales of their products will increase.
Social: Though Pakistan’s fashion industry is progressing and western products are
becoming acceptable but still it is a conservative market. People have different choices
and preferences at different occasions. However, we plan to stick to traditional Pakistani
clothes as they are more in demand then western wear.

Technological: In the retail sector, technological advancement is rising. We will need to

employ security cameras, inventory control system, customer relationship management
systems (CRM) in our outlet in order to add value to our products and offer convenience
to our customers as security is a major concern in Pakistan.

SWOT ANALYSIS
Strengths
• Unique shopping experience with exceptional customer service
• Large and growing consumer base
• Comfort and durability would be guaranteed.
• Positive refund & exchange policies will be available.
• Local suppliers therefore, prices will be reasonable.
• Online bookings for foreign and local customers.
• Great location, outlet would exist at a commercial area (Saba Avenue-near 26th
Street) where there would be more footfalls.
• Arco Baleno provides a unique facility that is to provide females with complete
variety of clothes and matching accessories, based on color schemes under one roof.
• Clean, tidy and air-conditioned atmosphere would be provided to the customers.
• Stocks can be returned to the suppliers if not sold.
• Loyalty cards/membership cards will be available for the customers offering various
packages and discounts.
• Female employees will be hired for the comfort of our valued customers and they will
be trained to give proper suggestions to our customers.
Weaknesses
• Limited sources of finance as Arco Baleno is a startup.
• Usually customers do not have in mind which colors they want to buy before coming
to a shop therefore, it’s a disadvantage.
• Clothes, shoes and accessories will be available in only seven most popular colors.
• High rental cost.
• Target populations are only high and middle income females.
• People don’t trust new brands easily.
• High competition due to already existing individual sellers of the products that we are
offering.

Opportunities
• Outlets can be opened in the main cities of Pakistan as well as in foreign countries.
• Further diversify our range of clothes by contracting with the renowned brands such
as (GulAhmed, Sana & Safinaz, etc).
• Arco Baleno can start manufacturing the clothes itself to cut costs in the long run.
• Introduce international accessories’ brands such as (Claires, Aldo).
• Outstanding shopping experience will lead to brand loyalty.
• Growing online Arco Baleno.

Threats
• A lot of new stores are opening providing high competition, lower profits and lower
market share for Arco Baleno.
• The increasing rents of location might increase costs and high inflation trends may
lead to high operating costs and high interest on loans.
• High cost of supplies.
• New similar retail shops that may or may not open in the future.
MISSION
Arco Baleno has the following aims:

1. Renovation of the shop: The store that we have selected is in a very good condition
however, the only renovation required is the painting according to our color schemes.
2. Stocking of goods: This would not only include buying and delivery of goods but also
arranging them onto the shelves.
3. Hiring of employees: As this is a very important part for a business, because an
impressive customer service would create brand loyalty. For this purpose one of the
partners will solely be responsible for the hiring of employees.
4. Healthy relation between the management and employees: For any business to run
effectively, coordination and cooperation is essential amongst the employees and the
management. Thus, Arco Baleno’ management intends to cater the needs of its
employees as much as possible so as to satisfy them increasing efficiency.
5. Initial Marketing: For a business to prosper specially a startup business awareness and
publicity is very crucial and once the correct image is set up at the initial phases of
the business, it would not take much time for the business to flourish.
6. Customer retention: Arco Baleno aims to provide its customers with quality products
in reasonable prices so as to ensure complete customer satisfaction which would
eventually lead to customer retention. Healthy long-term relationships with customers
and satisfaction is the objective our store, hence tailoring and alteration services,
online shopping services and customized products will be provided to customers.
Since word of mouth will play a significant role in setting up loyal consumer base,
vocally active customers are essential for maintaining positive referrals.
7. Financial well-being of the store: Which is to cover the monthly expenses and earn a
profit through sales. Maintain positive, steady, growth each month after the first year
and to meet the financial targets in the sales area and to reach breakeven by the
beginning of the second year of operations. React quickly to new opportunities and
run consistently high operation standards with effective utilization of funds and
controlling costs specially focusing on cost of sales and wages.
STRATEGY & IMPLEMENTATION

PHILOSOPHY
Arco Baleno’s core business strategy is to merge outstanding and knowledgeable
customer service with products that are trendy and of good quality. We’ll provide an
enjoyable shopping experience to our customers. Arco Baleno’s mission is to offer
women a wide selection of figure-flattering and stylish clothing as well as accessories
and shoes under one roof which is divided into different colored sections. Our aim is to
establish our company and build a brand name that will be synonymous with the fashion
industry.

MARKETING PLAN

PRODUCT DEVELOPMENT
We will be operating our store with the help of certain people. These include:
• Clothing supplier
• Accessories supplier
We will also move towards the façade renovation, as well as buying inventory, retail
displays, and office supplies. Prior to the grand opening of Arco Baleno store, we will
schedule an event with pre-publicity flyers, advertising and additional marketing
activities.
INTERNET STRATEGY
As the Internet has become an important part of a person’s everyday life and retail
merchandising, Arco Baleno will also have a practical website. We have secured the
domain name ArcoBaleno.com and will begin site development once we have our
merchandise on hand and the store becomes functional. Moreover, our website will be
designed and launched by Hertz Media. Our prime aim of having a website is to display
our brand, our merchandise and provide customers with the ability to purchase items
online. As the site will progress, we will include features such as fashion advice, designer
interviews, fashion game and newsletters. In the long run, we look forward to establish
such an online social community where women can gather and discuss topic of the day,
network and share clothing secrets.

MARKETING STRATEGY
Our marketing message and slogans will revolve around the idea of women as trend
setters. We expect our strategy to draw consumers into Arco Baleno from the very
beginning. Our goal is to keep our marketing budget in control. We have a few
connections with people in the print as well as broadcast media which will help us in
taking credit on publicity for local events. Initially, we will rely heavily on billboards.
Next, we will rely heavily on traditional media such as magazines or direct mail and
networking.

Prior to the grand opening of our store we will certainly build anticipation and excitement
about it. We will also place our advertisements in clubs, such as Karachi Gymkhana and
Karachi Club as a lot of our potential buyers go there. Also, this is a less costly
advertisement and has wide reach.

Widespread advertising and direct mail marketing campaigns which we will do twice a
year will follow the grand opening. Low cost publicity activities will also be taken
advantage of such as posting sale flyers in clubs and online.
As a final point, we will avail different marketing opportunities as we expand our
business and our number of consumers grow.

Positioning
Arco Baleno will position itself as a reasonably priced store. The consumers who
appreciate high-quality products will recognize the valued offerings of Arco Baleno.
Patrons will be both single and married females belonging to various age groups.
Customer service will be given utmost importance. All employees will ensure that the
customers are having the most pleasant shopping experience. All employees will go
through an extensive training program before getting hired. By offering a perfect
combination of quality products and service, Arco Baleno will surely excel relatively to
its competitors.

MARKETING MIX
Product
Arco Baleno aims to keep its customers a step ahead of new trends and seasons by
constantly adding new brands and styles in it.

Apparel

Since, fashion industry is mostly focused on youth and adults, Arco Baleno will sell its
customers with exclusive clothing line that will include casual wear as well as party wear.
Both the categories will have variety of unstitched clothes. Stitched clothes would be
available in the limited edition only. The material of clothes would be lawn, cotton, silk,
which is usually preferred by females. The clothes available would be according to latest
fashion trends as well our customer preferences. Furthermore, we would also provide our
clients with exclusive services, such as style assessment, personal shopping, online
shopping, and special ordering during store hours.

Clothes

Lawn Cotton Silk

Printed Fancy Plain Fancy Printed Fancy

Shoes & Accessories

The products offered to the customers will also comprise of shoes (both formal as well as
casual wear) and accessories including bags, hair accessories, laces and artificial jewelry.
We have contacted the local suppliers for shoes that will craft shoes according to the
clothes’ colors and designs as far as possible. The jewelry supplier would also provide us
with the same colored necklaces, charms, earrings, bracelets and rings.

Shoes

High Heels Sandals Slippers Pumps

Accessories

Bags Hair Accessories Laces Artificial Jewelry

The profits would be earned through sales of our merchandise. Our pricing structure
would remain fixed. Arco Baleno’s products will be available at reasonable prices. End
of season sales, holiday and overstock sales, multi-buy savings and promotional coupons
will be implemented at strategic intervals. Also, these coupons, promotions and discounts
will help us increase new customers as well as retain existing customers.

Price
The Products of Arco Baleno will be affordable. The average prices of the products are
given below:

Categories Selling Price/Unit

Lawn 450
Cotton 575
Embroidered Silk 1,475

Stitched Clothes (For Limited Edition only) 1,500

Sandals 750
High heels 1,000
Pumps 900
Slippers 650
Jewellery 200
Bags 425
Hair Accessories 125
Laces 100

Place

The market research conducted supported the location decision. Most of the females
chose Clifton or Defense as the perfect location for Arco Baleno and thus Main Saba
Avenue (Near Shamsheer) is suitable. Moreover, the target market will visit Arco Baleno
in Defense irrespective of the distance from their own residential areas. It’s a double
storey building and the area it occupies is 900 square feet per floor. Arco Baleno will
initially operate through a single retail outlet to start with. Later the business will be
expanded by opening outlets in the main cities of Pakistan as well as in foreign countries.
However, shopping can also be done online through our website as well.

Promotion

Based on the market survey the most appropriate method that will bring the largest chunk
of target market coverage will be billboards located at main Shahra-e- Faisal near Regent
Plaza and at Tariq Road near Dolmen Mall so as to attract a large number of people. We
also plan to advertise through the print media particularly in Libas magazine as market
demographics illustrate consumers who read fashion magazines quite often. Finally,
promotion will be done through blogs, word of mouth, text messages and internet mainly
facebook, yahoo group and you tube.

SOCIAL ENTREPRNEURSHIP
Arco Baleno will also do a social activity along with its business operations. It will give
employment to several household women in its outlet and train them in sewing and
embroidery. These hand made products will then sell in the Arco Baleno outlet and in this
way it will be able to support a major unemployed chunk of the economy.

Social Media Marketing

Arco Baleno is also doing the marketing of its products through using social media which
mainly includes social websites like facebook, orkut etc. We have already advertised
Arco Baleno by making groups on facebook and yahoo. We will also conduct polls
regarding the merchandise offered at our store in the future. This type of marketing
encourages voting, comments and the sharing of information. Apart from that it also
promotes two-way communication. Also, we have made a blog so that customers can
post their opinions about our store on blogging websites such as, wordpress and blogger.
In this way we will be able to create awareness about our store.
Viral Marketing
As viral marketing is the cheapest source of marketing and is also very cost effective,
Arco Baleno is using following tools for viral marketing which include internet, media
publicity, word of mouth and through personal relations. We will also upload our viral
marketing videos on youtube.com for our customer’s awareness. Apart from this, we will
distribute small amount of content about our store online and through the mobile phone
network.

Networking
In order to make our concept work, we need to build strong networking relationships with
our suppliers, customers, bankers, financiers and government officials/policy makers as
well. This will help Arco Baleno a lot in expanding its business.
LAUNCH
The formal opening of Arco Baleno will take place on the February 1st, 2009 at Main
Saba Avenue, next to the Arco Baleno’s outlet. Start of spring would be the best time to
launch as our logo and tagline represents colors and the concept based on different color
sections in our shop. We have opted for launching it on this date as it would be the start
of the spring season. This would be a small social event as all the stakeholders and
friends and families of the partners will be invited. We would give advertisements in
magazines and newspaper regarding the launch of the store. The guest of honor would be
Ruby Shakeel, the famous designer who specializes in women’s clothing who would
perform the ribbon cutting ceremony. We have arranged for her to come through are
networks. Her presence would create hype and attract people to the store and help in
creating our own image. We would randomly invite people from media and journalists to
cover the event. This would be a way to build an image in the minds of the customers and
to publicize our shop.

After a small tour of the store, the guests would be taken for high-tea where the partners
would have a chance to interact with the guests and ask for their feedback regarding the
concept and the store. The partners will try to interact with people from media as to
promote Arco Baleno.

Launch Costing

Hi - Tea (for 100 people) Rs.

Food (Brownies, chicken sandwiches, chicken patties) 5,000
Cold Drinks 1,500
Catering 2,000
Location Rent 10,000
Total Cost 18,500
POST-LAUNCH

FINANCIALS, BUDGETS & FORECASTS

SALES FORECAST
Break up of 1st month sales

Units Sold
Categories Selling Price/Unit Revenues
(monthly)
Lawn 100 500 50,000
Cotton 100 700 70,000
Embroidered Silk 70 1,750 122,500
Stitched Clothes (For
25 1,650 41,250
Limited Edition only)
Sandals 15 750 11,250
 High heels 15 1,000 15,000
Pumps 15 900 13,500
Slippers 15 600 9,000
Jewellery 275 300 82,500
Bags 80 500 40,000
Hair Accessories 80 100 8,000
Laces 475 125 59,375
Total 1,265 522,375

Sales Units Forecast

Categories Year 1 Year 2 Year 3 Year 4 Year 5

Lawn 1341 2012 2615 3138 3452
Cotton 1341 2012 2615 3138 3452

Embroidered Silk 939 1408 1831 2197 2417

Stitched Clothes (For

335 503 654 785 863
Limited Edition only)

Sandals 201 302 392 471 518

High heels 201 302 392 471 518
Pumps 201 302 392 471 518
Slippers 201 302 392 471 518
Jewellery 3688 5532 7192 8631 9494
Bags 1073 1609 2092 2511 2762
Hair Accessories 1073 1609 2092 2511 2762
Laces 6371 9556 12423 14908 16398
Total 16966 25,449 33,084 39,701 43,671
Break up of units sold in Year 1

Categories February March April May June July August September October November December January
Lawn 100 102 104 106 108 110 113 115 117 120 122 124
Cotton 100 102 104 106 108 110 113 115 117 120 122 124
Embroidered
70 71 73 74 76 77 79 80 82 84 85 87
Silk
Stitched
Clothes (For
25 26 26 27 27 28 28 29 29 30 30 31
Limited
Edition only)
Sandals 15 15 16 16 16 17 17 17 18 18 18 19
High heels 15 15 16 16 16 17 17 17 18 18 18 19
Pumps 15 15 16 16 16 17 17 17 18 18 18 19
Slippers 15 15 16 16 16 17 17 17 18 18 18 19
Jewellery 275 281 286 292 298 304 310 316 322 329 335 342
Bags 80 82 83 85 87 88 90 92 94 96 98 99
Hair
80 82 83 85 87 88 90 92 94 96 98 99
Accessories
Laces 475 485 494 504 514 524 535 546 557 568 579 591
Total 1,265 1,290 1,316 1,342 1,369 1,397 1,425 1,453 1,482 1,512 1,542 1573

Selling price/unit
Categories Selling Price/Unit
Year 1 Year 2 Year 3 Year 4 Year 5
Units in Year 1 Units in Year 1 Units in Year 1 Units in Year 1
Workings:
* 1.02 * 1.03 * 1.04 * 1.05
Lawn 500 510 515 520 525
Cotton 700 714 721 728 735
Embroidered Silk 1,750 1785 1802.5 1820 1837.5
Stitched Clothes
(For Limited 1,650 1683 1699.5 1716 1732.5
Edition only)
Sandals 750 765 772.5 780 787.5
High heels 1,000 1020 1030 1040 1050
Pumps 900 918 927 936 945
Slippers 600 612 618 624 630
Jewellery 300 306 309 312 315
Bags 500 510 515 520 525
Hair Accessories 100 102 103 104 105
Laces 125 127.5 128.75 130 131.25
Sales Revenues Forecast
Sales Revenue = Selling price/unit * Units

Sales Revenue (Rs.)

Categories Year 1 Year 2 Year 3 Year 4 Year 5
Lawn 670,604 1,026,025 1,346,909 1,631,983 1,812,443
Cotton 938,846 1,436,435 1,885,673 2,284,776 2,537,420
Embroidered Silk 1,642,981 2,513,761 3,299,927 3,998,359 4,440,485
Stitched Clothes
553,249 846,471 1,111,200 1,346,386 1,495,265
(For Limited Edition only)
Sandals 150,886 230,856 303,055 367,196 407,800
High heels 201,181 307,807 404,073 489,595 543,733
Pumps 181,063 277,027 363,665 440,635 489,360
Slippers 120,709 184,684 242,444 293,757 326,240
Jewellery 1,106,497 1,692,941 2,222,400 2,692,772 2,990,531
Bags 536,484 820,820 1,077,527 1,305,586 1,449,954
Hair Accessories 107,297 164,164 215,505 261,117 289,991
Laces 796,343 1,218,405 1,583,926 1,937,980 2,152,276
Total 7,006,140 10,719,395 14,056,304 17,050,143 18,935,496

SALES STRATEGY
Arco Baleno intends to generate sales through various marketing efforts which will be
targeted towards new and loyal customers as well as single visit tourist customers. We
will offer promotional and seasonal discounts on a regular basis.

Arco Baleno will accept payments through both cash and credit cards. Favorable refund
and exchange policies will be offered to Arco Baleno’s customers which will permit
exchanges and returns within 30 days of purchase but receipts will be mandatory.
Sales staff will be hired to assist the partners which will be females only. This is to
increase the comfort level of our customers while shopping. Our sales staff will provide
customers with appropriate fashion advice helping them to shop easily.

EXPENSES
Startup Cost
Firm Registration: Rs. 5,000
Launch Cost: Rs. 18,500
Equipment:
Carpenter Rs. 1000
Computer Rs. 22,000
Barcode Reader Rs. 6,000 Rs. 29,000
Website:
Making & Launching Rs. 82,000
Paint: Rs. 8,000

Rs. 142,500
Expenses (forecast) in first month of operations

Fixed Cost
Location Rent: Rs. 150,000
Website:
Hosting Website (Rs. 8,000/year) Rs. 667
Domain Rs. 1,500 Rs. 2,167

*Loan Principal + Interest (Rs. 6,667 + 7,000) Rs. 13,667

Wages: (Rs. 6,000 * 6 + 3000) Rs. 36,000

Repair & Maintenance: Rs. 30,000

Marketing Expenses:
 Magazine: Rs. 25,000
Billboard: (Rs. 150,000 * 2) Rs. 300,000 Rs. 325,000

Rs. 554,667
Variable Cost
**Stock: Rs. 351,300
Electricity: Rs. 35,000
Telephone: Rs. 5,000
Generator Fuel: Rs. 7,500

Rs.388,800
Total Cost in First Month = Fixed cost + Variable cost
= Rs. 554,667 + Rs. 388,800
= Rs. 943,467

*Working for monthly loan principal and interest payments

Principal = Rs. 400,000/5 = Rs. 80,000/12 = Rs. 6,667

Interest = Rs. 400,000 * 21/100 = Rs. 84,000/12 = Rs. 7,000

**Stock Calculation

Quantity * Average Price

Categories Total Cost
(For all color sections)
Lawn 20 pieces * 300 * 6 36,000
Cotton 20 pieces * 400 * 6 48,000
Embroidered Silk 15 pieces * 1000 * 6 90,000
Stitched Clothes (For
30 pieces * 1000 30,000
Limited Edition only)
Sandals 3 pairs * 400 * 6 7,200
High heels 3 pairs * 600 * 6 10,800
Pumps 3 pairs * 500 * 6 9,000
Slippers 3 pairs * 300 * 6 5,400
Jewellery 50 pieces * 150 * 6 45,000
Bags 15 pieces * 300 * 6 27,000
Hair Accessories 15 pieces * 50 * 6 4,500
Laces 80 pieces * 80 * 6 38,400
Total Cost of Stock 351,300
 Working for each product’s first monthly expenses
Variable Cost Total Variable Fixed Total Sales Selling
Categories
(excluding stock) Variable Cost Cost/Unit Cost Cost Tax Price/Unit
Lawn 3,843 39,843 398 46,181 86,023 462 500
Cotton 5,124 53,124 531 46,181 99,304 616 700
Embroidered Silk 9,607 99,607 1,423 46,181 145,788 1,651 1,750
Stitched Clothes
(For Limited 3,202 33,202 1,328 46,181 79,383 1,541 1,650

Edition only)
Sandals 769 7,969 531 46,181 54,149 616 750
High heels 1,153 11,953 797 46,181 58,133 924 1,000
Pumps 961 9,961 664 46,181 56,141 770 900
Slippers 576 5,976 398 46,181 52,157 462 600
Jewellery 4,804 49,804 181 46,181 95,984 210 300
Bags 2,882 29,882 374 46,181 76,063 433 500
Hair Accessories 480 4,980 62 46,181 51,161 72 100
Laces 4,099 42,499 89 46,181 88,680 104 125
Total 37,500 388,800 554,167 942,967
Cost Price/Unit
Categories Cost Price/Unit
Year 1 Year 2 Year 3 Year 4 Year 5
Price in Price in Year Price in Year Price in Year
Workings:
Year 1 * 1.01 1 * 1.02 1 * 1.03 1 * 1.04
Lawn 300 303 306 309 312
Cotton 400 404 408 412 416
Embroidered Silk 1000 1010 1020 1030 1040
Stitched Clothes
(For Limited 1000 1010 1020 1030 1040
Edition only)
Sandals 400 404 408 412 416
High heels 600 606 612 618 624
Pumps 500 505 510 515 520
Slippers 300 303 306 309 312
Jewellery 150 151.5 153 154.5 156
Bags 300 303 306 309 312
Hair Accessories 50 50.5 51 51.5 52
Laces 80 80.8 81.6 82.4 83.2

Cost of Stock Forecast

Cost of Goods Sold = Cost price/unit * Units

Cost of Goods Sold (Rs.)

Categories Year 1 Year 2 Year 3 Year 4 Year 5
Lawn 402,363 609,579 800,299 969,775 1,077,109
Cotton 536,484 812,773 1,067,066 1,293,033 1,436,145
Embroidered Silk 938,846 1,422,352 1,867,365 2,262,807 2,513,254
Stitched Clothes
335,302 507,983 666,916 808,145 897,591
(For Limited Edition only)
Sandals 80,473 121,916 160,060 193,955 215,422
High heels 120,709 182,874 240,090 290,932 323,133
Pumps 100,591 152,395 200,075 242,444 269,277
Slippers 60,354 91,437 120,045 145,466 161,566
Jewellery 553,249 838,172 1,100,412 1,333,440 1,481,025
Bags 321,890 487,664 640,240 775,820 861,687
Hair Accessories 53,648 81,277 106,707 129,303 143,615
Laces 509,659 772,134 1,013,713 1,228,381 1,364,338
Total 4,013,568 6,080,555 7,982,986 9,673,501 10,744,161

FUNDS REQUIRED
Arco Baleno will need Rs. 1,085,967 to start off. This includes the startup cost + fixed
and variable cost for the first month of operations. Rs. 705,879 will be equally invested
by the five owners and Rs. 380,088 by bank loan of Rs. 400,000 from Alfalah Bank. The
loan is for 5 years charging 21% interest rate annually.
 INCOME STATEMENT PROJECTIONS
Income Statement of Arco Baleno for the Years 1 to 5
Year 1 Year 2 Year 3 Year 4 Year 5
Sales
Lawn 670,604 1,015,966 1,333,832 1,616,291 1,795,181
Cotton 938,846 1,422,352 1,867,365 2,262,807 2,513,254
Embroidered
Silk 1,642,981 2,489,116 3,267,889 3,959,913 4,398,194
Stitched Clothes
(For Limited
Edition only) 553,249 838,172 1,100,412 1,333,440 1,481,025
Sandals 150,886 228,592 300,112 363,665 403,916
High heels 201,181 304,790 400,150 484,887 538,554
Pumps 181,063 274,311 360,135 436,399 484,699
Slippers 120,709 182,874 240,090 290,932 323,133
Jewellery 1,106,497 1,676,344 2,200,823 2,666,880 2,962,049
Bags 536,484 812,773 1,067,066 1,293,033 1,436,145
Hair
Accessories 107,297 162,555 213,413 258,607 287,229
Laces 796,343 7,006,140 1,206,459 10,614,303 1,583,926 13,935,213 1,919,345 16,886,200 2,131,778 18,755,158
Less: Cost of
Goods Sold
Lawn (402,363) (609,579) (800,299) (969,775) (1,077,109)
Cotton (536,484) (812,773) (1,067,066) (1,293,033) (1,436,145)
Embroidered (938,846) (1,422,352) (1,867,365) (2,262,807) (2,513,254)
Silk
Stitched Clothes
(For Limited (808,145)

Edition only) (335,302) (507,983) (666,916) (897,591)

Sandals (80,473) (121,916) (160,060) (193,955) (215,422)
High heels (120,709) (182,874) (240,090) (290,932) (323,133)
Pumps (100,591) (152,395) (200,075) (242,444) (269,277)
Slippers (60,354) (91,437) (120,045) (145,466) (161,566)
Jewellery (553,249) (838,172) (1,100,412) (1,333,440) (1,481,025)
Bags (321,890) (487,664) (640,240) (775,820) (861,687)
Hair
(129,303)
Accessories (53,648) (81,277) (106,707) (143,615)
Laces (509,659) (4,013,568) (772,134) (6,080,555) (1,013,713) (7,982,986) (1,228,381) (9,673,501) (1,364,338) (10,744,161)
Gross Profit 2,992,573 4,533,747 5,952,227 7,212,698 8,010,997
Less: Expenses
Rent (1,800,000) (1,800,000) (1,800,000) (1,800,000) (1,800,000)
Website (26,000) (26,000) (26,000) (26,000) (26,000)
Loan Principal +
interest (164,000) (164,000) (164,000) (164,000) (164,000)
Marketing (1,950,000) (1,950,000) (1,950,000) (1,950,000) (1,950,000)
Repair &
Maintenance (360,000) (360,000) (360,000) (360,000) (360,000)
Wages (432,000) (436,320) (445,046) (458,398) (476,734)
Electricity (420,000) (424,200) (432,684) (445,665) (463,491)
Telephone (60,000) (60,600) (61,812) (63,666) (66,213)
Generator Fuel (90,000) (5,302,000) (90,900) (5,312,020) (92,718) (5,332,260) (95,500) (5,363,228) (99,320) (5,405,757)
Net Profit/(Loss) (2,309,427) (778,273) 619,966 1,849,470 2,605,240
Profit/(Loss)
Year 1 Year 2 Year 3 Year 4 Year 5
Appropriation
Partners Profit/(Loss) Profit/(Loss) Profit/(Loss) Profit/(Loss) Profit/(Loss)
Areej Hashmi (461,885) (155,655) 123,993 369,894 521,048
Mahwish Kamil (461,885) (155,655) 123,993 369,894 521,048
Nazan Khan (461,885) (155,655) 123,993 369,894 521,048
Tansheet Raza (461,885) (155,655) 123,993 369,894 521,048
Zoha Raza Jivani (461,885) (155,655) 123,993 369,894 521,048
Net Profit/(Loss) (2,309,427) (778,273) 619,966 1,849,470 2,605,240

20,000,000
18,000,000
16,000,000
14,000,000
12,000,000 Sales
10,000,000
8,000,000 Cost of goods
6,000,000 sold
4,000,000
Expenses
2,000,000
0
Year Year Year Year Year
1 2 3 4 5

CASH FLOW PROJECTIONS

Our business will collect immediate payment from customers, so our cash flow statement
will be substantially similar to our income statement.

BREAK EVEN
Breakeven will be reached between year 2 and 3 of our business operations. This can be
observed from the net profit/ (loss) amounts calculated in the above income statement as
year 3 will be our first year of profits.
BALANCE SHEET
Each partner’s investment will be of Rs. 141,176 and Rs. 400,000 will appear as long
term liability in the balance sheet.

ASSUMPTIONS
Our projections are based on the assumption that the economy, consumer spending habits
and population growth of females of Karachi will continue in the future.
We have also assumed that units bought = units sold.
We must also assume that our present and future suppliers will continue to sell inventory
to us at prices that allow us to maintain our present margins.
It is also important that we are able to hire reliable employees at reasonable wages.

CONTROLS
The purpose of Arco Baleno’s marketing plan is to serve as a guide for the organization.

MILESTONES
The following milestones identify the key marketing programs. It is important to
accomplish each one on time, and on budget.

Start Month Budget

Advertising
Marketing plan completion December Rs.0
Billboard ad campaign #1 (Teaser) January Rs.150,000
Billboard ad campaign #2 (Launch) February Rs.150,000
Total Advertising Budget Rs.300,000
Web Marketing Start Month Budget
Blog October Rs. 0
Facebook November Rs.0
You Tube December Rs. 0
Website (design & launch) January Rs.82,000
Total Web Budget Rs.82,000
Print Media Start Month Budget
Libas Magazine December Rs.25,000
Total Print Budget Rs.25,000
Totals Rs.408,000

EXIT STRATEGY & CONTINGENCY PLANNING

The owners of Arco Baleno intend to continue business for at least 5 years but in case if
any of the owners decide to quit, Arco Baleno will continue working depending upon the
sales growth, market share and number of customers. The worst risks could be aggressive
actions by competitors or otherwise making it difficult for Arco Baleno to sustain and
make a space in the retail industry leading towards low market share and diminishing
consumer confidence and base. In this situation, we will sell the business or sell
individual assets and divide the money according to the owner’s investments.

CONCLUSION
The idea put forward is unique and at the same time is relatable to people. It is tends to
provide consumers with convenience, saving their time and money. From different
analyses that were conducted it was observed that women have to visit many places in
search of the colors they desire. Arco Baleno’s product range and concept are particularly
designed to cater these needs. It will be the first retail store in Pakistan that will be based
upon different color sections where women can find matching clothes and accessories.
Arco Baleno has a lot of potential if all the strategies are implemented and executed
properly and as planned.

REFERENCES

FOR MARKETING
• www.facebook.com-make Arco Baleno group
• www.yahoo.com-made Arco Baleno group
• www.youtube.com uploaded teaser video
 • www.arcob.blogspot.com Arco Baleno’s blog
• Ayesha Amin Khan, owner of Mahjabeen - Billboard and print ads rates
• Karachi Gymkhana
• Karachi Club
• Hertz media-website design and launch

FOR LOCATION
• Mr. Irfan Qasim-owner of the building
• 0321-2600383

FOR PRICING
• Mr. Khurram-supplier of accessories
• 0321-2051471
• Mr. Ahmed-supplier of shoes
• Ms. Shazia-supplier of clothes
• 0300-2066816

APPENDIX A

ENTREPRENEURSHIP QUESTIONNAIRE

We, BBA students of SZABIST are conducting this survey to find out whether a new
women store (having clothes, shoes & accessories under one roof) situated at Main Saba
Avenue will work or not. The data collected through this questionnaire will only be used
in our Entrepreneurship course report. For acquiring a soft copy of our final report please
write your email address here: _______________________________________________

Location: ________________ Age: 15-20 20-25 25-30 30 & above

1. If a new shop which has apparel/accessories/shoes, divided on the basis of colors

available under one roof would you visit it?

Yes No ______________________________________________________

If no, thank you for your co-operation. If yes, please answer rest of the questions.

2. How often do you shop?

Weekly Monthly Occasionally

3. How many hours do you spend on shopping in one time?

1hour 3 hours 5 hour Other_____________________________

4. Will you prefer shopping for clothes and accessories under one roof?

Yes No _____________________________________________________

5. Will shopping be convenient for you if the shop is divided into different colored
sections?

Yes No ______________________________________________________

6. What is the best possible area for an apparel/accessories/shoe store?

Clifton Defense Tariq Road Others______________________

7. How are you most likely to know about a new apparel/accessories store?

Billboards Internet Word of mouth Newspapers/Magazines

Others____________________________________________________

8. Where do you normally shop for apparel/accessories/shoes?

Branded stores Stores in your vicinity

Where everything is available under one roof

9. Your selection of apparel/accessories/shoes depends on:

Cheap Price Good Quality Brand Name Other______________

10. What do you dislike about your current shopping stores for
apparel/accessories/shoes?

Price Quality Variety

Convenience (unavailability of apparel/accessories/shoes under one roof)

11. According to you, where should the prices start from for the following?

(Please tick a number for each category corresponding to the rating scale provided.)

Rs. 50 Rs. 100 Rs. 500 Rs 700 Rs. 1000

____________________________________________________________________
1 2 3 4 5
Categories Ratings
Clothes 1 2 3 4 5
Jewelry 1 2 3 4 5
Shoes 1 2 3 4 5
Bags 1 2 3 4 5
Hair accessories 1 2 3 4 5
Laces 1 2 3 4 5

12. Which types (stitched/unstitched) of clothes will you prefer for the following?
(Please tick your type of clothes for each category/occasion.)

Categories Stitched Unstitched

Lawn
Cotton
Silk
Formal wear
Casual wear
Occasions Stitched Unstitched
Eid
Birthday
Weddings
Parties

13. Would you prefer a play area in a ladies apparel/accessories store?

Yes No

14. Which is the first store that comes to your mind when you think about matching
apparel/accessories/shoes under one roof?

Thank you for co-operation!