Index

1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. Business Overview Industry Overview Competitive Analysis Marketing Strategy Mission Statement Target Market Unique Selling Proposition Pricing Strategy Promotional Plan Marketing Budget Action List Metrics

BUSINESS OVERVIEW Background CRAFT PLUS INDIA is a registered body with a network of C.P. Group of Co. Formed in 1996, it has addressed many challenges faced by crafts persons and craft communities across India post independence. Through Craft Plus India the C.P. group seeks to demonstrate that professional marketing support is as essential means of developing traditional crafts and providing sustainable livelihood Wide Range of Activities : Getting off the ground in a relatively small way, in 1991, as a retailer and distributor of Bata footwear, by 1995 the C.Ps had pioneered the first exclusive Reebok store in the country, at Lajpat Nagar, in New Delhi. In 1997, we introduced the concept of highway stores retailing a multinational product by opening an Adidas outlet on the Delhi-Haryana national highway no.8. The following year we began marketing Lotus shoes, of England. Making rapid strides in retailing, the company has launched several new ventures since then, in an international brands of footwear, garments, and cosmetics. Among the MNC brands in which we are dealing are majors like Reebok, Addidas, Rockport, Greg Norman, Benetton, Revelon, Lotus, and last but not the least, MTV. Our store on national highway no.2 sells Benettons garments, MTVs fashion wear, and Planet Kids brands under one roof. In addition, we constitute the distributor for the Modi Group, for the internationally renowned Revelon range of imported cosmetics. Presently, we are lying considerable emphasis on expanding business in Indian, and particularly/especially Handloom & Handicrafts of India. For this our store in Lajpat Nagar, selling a host of attractive and utilitarian handicrafts like sarees, durries, furniture, fabrics, jewellery and various decorative items, has a tie-up with the Gujarat State Handicrafts Corporations for those who hold our heritage in their hands. CRAFT PLUS INDIA (CP) is a working in the craft sector for welfare of craft persons and development of Handicraft and Handloom sector since 2006, based in Delhi (India). Having more than 2500 craftsmen working under it. Main activities of CRAFT PLUS INDIA 1. Organize Trade Fairs / Exhibitions all over India /Overseas. 2. Providing Platform for marketing to the crafts persons / weavers / artisan / entrepreneurs by promoting their crafts and products through Selling our C.P, showroom, on line showroom and organizing exhibition and trade fairs in metro cities in India and all over world. 3. A one stop shop for Indias largest verity of handicrafts and handloom. 4. Availability of low cost, traditional and custom made design under one roof.

5. The place to find craft person and artisan from all over India and their master creations. 6. More than 2500 craftsmen working under CRAFT PLUS INDIA. 7. Helping both crafts person as well as customer in both hands at one place one gets market, platform with other get verity products at reasonable price. 8. Crafts demonstrating and display by award winning crafts persons from all over India and their master creation. Services to Crafts Persons 1. 2. 3. 4. 5. 6. Trade forecasts tendencies. Design and product development consultancy Stand Design (space design) Quality Productivity workshop & training Library / Resource Centre Marketing Support

Services to Buyers 1. Design consultancy / Design development. 2. Production & Quality support. Export Services 1. Participating of International Trade Fairs and promoting Indian crafts all over the world. 2. Production and Quality management. 3. On line Shopping.

INDUSTRY OVERVIEW As outlined in the Price Waterhouse Cooper (PWC) leadership study, most global retailers, especially in the current economic environment are looking at India & China to grow, to shore up revenue and access to new customers. Indias robust macro- and micro economic fundamentals, such as robust gross domestic product (GDP Growth), higher incomes, increasing personal consumption, favorable demographics and supportive government policies will accelerate the growth of retail sector. Indian retail sector is perhaps one of the most challenging, dynamic and existing market to operate in. The Indian economy expected to touch almost 2 trillion in the next 10 years adding new consumption of 650 billion in the next decade according to an analysis by Techno Park. During the last 50 yrs population has grown two and half times, urban grown by five times. By 2020 almost 35% of population will live in urban centers which contribute 65% of GDP from current 60%. India will add almost one thirty million people in the consuming age group of 15 to 59 years. The domestic apparels market has been estimated at $33 billion expected to reach $100 billion by 2020. The domestic textile market is expected to grow 9% by 2020. 2010 GDP: 850 bn 2020 GDP: 1920 bn

Private Consumption: 490 bn

Private Consumption: 1115 bn

Retail: 270 bn (55%) Urban: 120 bn (45%)

Retail: 525 bn (45-50%) Urban: 280 bn (50-55%)

Organised Retail: 12 bn (5%)

Organised Retail: 125 bn (24%)

Highlights 2010 E 2020 E Textile and apparel 3,68,000 Cr 10,32,000 Cr industry Home Textile 17,000 Cr 40,000 Cr (Domestic) Handicraft targets for 2011-2012 Rs. 12,428 Cr (on a 8.94% in last 16 years) CAGR% 10.86 8.93 CAGR of

COMPITORS OF CRAFT PLUS INDIA

Threats

Strength

Opportunitie s

Weakness

UNORAGNISED SECTOR a. TAILORING OUTLETS STRENGTH 1) REACHING OUT TO CUSTOMER WITH LARGER DISPERSION. 2) ENSURE CONENVEINCE OF DEMANDING SERVICE. WEAKNESS 1) VERY FRAGMENTED BUSINESS APPROACH. 2. N.G.O.S STRENGTH 1) PROMOTION COMMUNITY BASED OPERATIONS. 2) COMPLEMENTORY PRODUCTS MANUFACTURED WITH OTHER FIRM. WEAKNESS. 1) LACK OF RETAILING EXPERTISE AND INABILITY TO MINIMISE COST. 2) PRODUCTS ARE MOSTLY PRODUCED FOR SOVENIER OR ARTIFACTS OF COLLECTORS INTEREST. 3. ORAGNIZED SECTOR 4. RETAILING HOUSES ( SHOPERS STOP, WESTSIDE, RELIANCE, TRENDS, GLOBUS) i. STRENGTH NATIONAL PRESENCE OF OUTLETS. RETAILING EXPERTISE AND COMPETITIVE PRICING . A GILITY FOR QUICK PRODUCT DEVELOPMENT CYCLE.

1.

ii.

WEAKNESSDIVERSITY OF PRODUCT IS VERY LESS, RETAILING BRANDS AND IN HOUSE LABELS HAVE A CONSIDERABLE SHARE OF P[RODUCT MIX. THE TRENDS ARE DDESIGNED ASPER RECENT GARMENTS AND ACCESSORIES TRENDS. 5. GARMENT HANDLOOM HOUSE STRONG LEGACY ATTACHED TO PRODUCTS. i. WEAKNESS BUSINESS IS HEAVILY IS INFLUENCE OF BUREAUCRATIC. 6. 4 KHADI GRAMUDYOG, CCI - SUBSIDIZED MANUFACTURING AND COSTS a. WEAKNESS - APPROACH OF EMPLOYEES. NO SIGNIFICAT PRODUCT EVOLUTION. 7. DESIGNER BOUTIQUES SCOPE OF PRODUCTS CUSTOMIZATION. HIGHEST LEVEL OF CUSTOMER INTIMACY. 8. WEAKNESS - NO UNIFORMITY IN PRICE ACROSS PRODUCTS. LIMITED MODELS OF SKUS MANUFACTURED. 9. CRAFTPLUS INDIA MODELLED GARMENT HOUSES ( FAB INDIA, ANOKHI, BOMBAY SWADESHI STORES) i. STRENGTHDIFFERNTIABLE PRODUCTS , ESTABLISHED BRAND AND MARKET. SERVICING HIGH VALUE CUSTOMERS b. WEAKNESS MINIMAL PRODUCT LINES, HANDICRAFTS FROM WESTERN REGIONS, PRICES AT MUCH HIGHER THAN AVERAGE FABINDIA PRICES.

TARGET CUSTOMERS

DOMESTIC MIDDLE CLASS, UPPER MIDDLE CLASS , RICH CLASS INTERNATIONAL FOREIGNERS- DEPLOMATICS NRIS

TARGET MARKET PRICE HANDICRAFTS - STARTS FROM RS.100/- TO 4 LACS PRICE HOME DCOR - STARTS FROM - RS. 295/- TO 30000 PRICE APPARELS STARTS FROM RS. 395/- TO 6500 PRICE SAREES STARTS FROM - RS. 700/- TO 59000 PRICE - HANDLOOM STARTS FROM - RS. 120/- TO 1500 PROMOTIONS COMMUNICATION IS COMPLETELY CUSTOMERS DRIVEN , PRINT , ONLINE PRODUCT QUALITY AND UNIQUE - HANDLOOM ( COTTON, SILK,PASHMINA , WOOLEN ) HANDICRAFTS METAL, WOOD, STONE JEWELLERY SEMIPRECIOUS, IMITATIONS LEATHER JUTTI WALL HANGINGS PLACE - NEW DELHI

CUSTOMER CONNECT INITIATIVES

CRAFTPLUS DOES NOT FOLLOW ANY CUSTOMER ACQUISITIONS STRATEGY. IT MAINLY FOCUSES ON CUSTOMER RETENTION. CRAFTPLUS CREATES ITS MARKET THROUGH ITS EXISTING CUSOMERS WHICH IS QUITE EVIDENT FROM THE FACT THAT ABOUT 85% OF ITS CUSOMERS AREA REPEAT CUSTOMERS. THE UNIQUE SELLING PROPOSITION OF CRAFTPLUS IS THE QUALITY OF THE FABRIC AND THE TRADITIONAL STYLE. WHICH IS ALWAYS IN VOGUE THEY HAVE DESIGNED THE STORES DCOR AND AMBIANCE KEEPING THIS IN MIND.THEY CONSTANTLY TRY TO IMPROVE UPON THE QUALITY OF THE PRODUCTS IN ORDER TO RETAIN THEIR CUSTOMERS. THE COMPANY CONCENTRATES ON CUSTOMER FEEDBACK BY MAINTINAING A VISITORS REGISTER TO RECORD CUSTOMER VIEWS. THE STORE MANAGERS PREPARE A REPORT WHICH IS PERIODICALLY REVIEWED BY THE PRODUCT SELECTION COMMITTEE AT CRAFTPLUS IN ORDRE TO KNOW ABOUT THE BUYING PATTERN AMONG CUNSUMERS. RECENTLY CRM SOFTWARE HAS BEEN IMPLEMENTED IN SOME OF THE STORES WHICH WILL HELP IN MAINTINAING A CENTRALIZED DATABASE. THIS

WILL HELP CRAFTPLUS IN RETAINING CUSTOMERS BY BUILDING LASTING RELATIONSHIP AND IMPROVING LOYALITY. THE IMPLEMENTATIONS HOWEVER IS STILL IN ITS NASCENT STAGE BUT IS SOON EXPECTED TO BE SPREAD ACROSS ALL THE STORES IN THE COUNTRY. CRAFTPLUS INDIA ALSO HAS THE MYSTERY SHOPPER PROGRAM IN ORDER TO VOGUE THE CUSOMER SATISFACTION LEVEL. MYSTERY SHOPPERS POSING AS NORMAL PERFORM SPECIFIC TASKS SUCH AS PURCHASING A PRODUCT ASKING QUESTIONS REGISTERING COMPLAINTS OR BEHAVING IN A CERTAIN WAY AND THEN PROVIDE DETAILED REPORTS OR FEEDBACK ON THEIR EXPERIENCES TO THE MANAGEMENT. IT SERVES AS AN EFFECTICE TOOL TO IMPORVE THE CUSTOMER EXPERIENCE.

Financial Parameters:

Performance Indicators

20082009201009 10 11 Amount (Rs. In Crs.) 0.27 1.39 1.09 0.89 0.83 0.33 0.50 0.57 9.35% 64.03% 22.81% 17.98% 28.07% 0.45 1.92 1.45 0.97 1.35 0.40 0.95 0.92 14.06% 50.52% 29.35% 35.05% 36.96%

201112

Capital 0.25 Net Worth (Net Fixed Assets + Working Capital) 1.34 Long Term Loans Net Fixed Assets Current Assets Current Liabilities Working Capital Capital Employed Return on Net Worth Fixed Asset to Networth Ratio Return on Capital Employed PBIT/Assets PBIT/Capital employed 1.06 0.90 0.84 0.40 0.44 0.53 6.72% 67.16% 16.98% 22.22% 37.74%

0.85 2.15 1.65 1.15 1.65 0.50 1.15 1.35 21.40% 53.49% 34.07% 64.35% 54.81%

Return on Net Worth

25.00%

20.00%

15.00% Return on Net Worth 10.00%

5.00%

0.00% 1 2 3 4

Fixed Asset to Networth Ratio

80.00% 70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00% 1 2 3 4 Fixed Asset to Networth Ratio

Return on Capital Employed

40.00% 35.00% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% 1 2 3 4 Return on Capital Employed

PROJECTED DEPRECIATION CHART FOR THE FIRST FIVE YEARS S.NO A. PARTICULARS BUILDING 1. COST/WDV Addition 0.00 50.40 50.40 2. DEPRECIATION B. OFFICE EQUIPMENT 1. COST/WDV Addition 0.00 33.60 33.60 2. DEPRECIATION C. MISC. FIXED ASSETS 1. COST/WDV Addition 0.00 8.40 8.40 7.98 8.82 16.80 15.56 9.26 24.82 22.80 9.72 32.52 29.75 10.21 39.96 2.52 31.08 35.28 66.36 7.31 59.05 37.04 96.09 11.64 84.45 38.89 123.34 15.58 107.76 40.83 148.59 19.23 2.52 47.88 52.92 100.80 7.43 93.37 55.57 148.94 12.12 136.82 58.35 195.17 16.60 178.57 61.27 239.84 20.92 IST 2ND 3RD 4TH 5TH

2. DEPRECIATION TOTAL FIXED ASSETS -----------------1. WDV 2. DEPRECIATION 3. ORIGINAL COST

0.42

1.24

2.02

2.77

3.49

86.94 5.46 92.40

167.98 15.98 189.42

244.07 25.78 291.29

316.08 34.95 398.25

384.75 43.64 510.56

PROJECTED SERVICING OF LOAN FOR THE FIRST FIVE YEARS

S.NO A.

PARTICULARS IST TERM LOAN FROM BANK :1. LOAN OUTSTANDING AT THE 0.00 OPENING OF THE YEAR 2. FRESH OF LOAN DRAWDOWN

2ND

3RD

4TH

5th

100.03

93.33

97.45

100.66

105.30 5.27

108.77 15.44

112.40 14.95

116.22 15.56

120.23 16.08

3. INSTALMENT OF LOAN

4. LOAN OUTSTANDING AT THE 100.03 CLOSING OF THE YEAR 5. RATE OF INTEREST @% 12.50% 6. INTEREST FOR THE YEAR 6.58

193.36

190.78

198.11

204.81

12.50%

12.50%

12.50%

12.50%

19.30

18.69

19.45

20.10

C P MARKETING LIMITED

PRIVATE

PROJECTED PROFIT & LOSS ACCOUNT FOR THE FIRST FIVE YEARS S.NO A. PARTICULARS INCOME :1. Sales TOTAL (A) B. EXPENSES :-------1. Purchases 2. Electricity & Fuel 3. Rent 4. Labour & Wages 5.Depreciation Cost of Production Add Opening Stock Finished Goods Less Closing Stock Finished Goods Cost of Sale 6. Interest on C/C Limit. 100.00 20.00 192.00 25.20 5.46 342.66 of 0.00 of 50.00 292.66 7.25 110.00 645.98 10.15 19.30 35.30 1.24 88.00 799.97 80.03 24.73 181.50 1024.68 13.05 18.69 54.81 2.02 145.20 1258.45 193.55 59.81 266.20 1432.73 14.50 19.45 75.87 2.77 212.96 1758.28 371.32 114.74 366.03 1874.68 17.40 20.10 98.73 3.49 292.82 2307.22 620.99 191.88 50.00 110.00 181.50 266.20 220.00 44.00 384.00 42.00 15.98 705.98 363.00 72.60 576.00 58.80 25.78 1096.18 532.40 106.48 768.00 75.60 34.95 1517.43 732.05 146.41 960.00 92.40 43.64 1974.50 400.00 400.00 880.00 880.00 1452.00 1452.00 2129.60 2129.60 2928.20 2928.20 IST 2ND 3RD 4TH 5TH

7. Interest on Term Loan 6.58 8. Selling & Administration Exp. 17.13 9. Depreciation 0.42 10. Advertisement Expenses 40.00 TOTAL RS. (B) 364.04 NET PROFIT BEFORE TAX(A-B) 35.96 PROVISION FOR INCOME TAX 11.11

Net Profit after Tax

24.85

55.30

133.74

256.58

429.11

PROJECTED BALANCE SHEET FOR THE FIRST FIVE YEARS OF THE PROJECT LIABILITIES ----------1. Capital 2. C/C Limit From Bank 3. Term Loan from Bank TOTAL RS. (A) ASSETS -----1. Fixed Assets 2. Closing Stock 86.94 60.15 167.98 110.00 96.00 28.89 402.87 0.00 244.07 181.50 144.00 21.93 591.50 0.00 59.95 50.00 100.03 209.98 139.51 70.00 193.36 402.87 310.72 90.00 190.78 591.50 IST 2 ND

3RD -

4TH -

5TH -

495.30 100.00 198.11 793.41 -

695.91 120.00 204.81 1020.72 -

316.08 266.20 192.00 19.13 793.41 0.00

384.75 366.03 240.00 29.94 1020.72 0.00

3. Security Deposits 48.00 3. Current Assets over Current Liablities 14.89 TOTAL RS. (B) 209.98 0.00

C P MARKETING PRIVATE LIMITED PROJECTED DEBT SERVICE COVERAGE RATIO FOR THE FIRST FIVE YEARS OF THE PROJECT S.NO IST 2ND 3RD 4TH 5TH

A.

Net Profit after Tax but before depreciation and intt. on term loan

42.96

100.57

214.26

393.54

644.58

B.

INSTALMENT OF LOAN & INTT. ON 11.85 TERM LOAN DEBT SERVICE COVERAGE RATIO 3.63 AVERAGE RATIO 8.39

34.74

33.64

35.01

36.18

C. D.

2.89

6.37

11.24

17.82

1. Sales
3500.00 3000.00 2500.00 2000.00 1500.00 1000.00 500.00 0.00 1 2 3 4 5 1. Sales

Net Profit after Tax

500.00 450.00 400.00 350.00 300.00 250.00 200.00 150.00 100.00 50.00 0.00 1 2 3 4 5 Net Profit after Tax

DEBT SERVICE COVERAGE RATIO

20.00 15.00 10.00 5.00 0.00 1 2 3 4 5 DEBT SERVICE COVERAGE RATIO