Business Plan
Zoro Tech Ventures, Inc.
G-8, Federal Area, Islamabad
44046
051-7777565
Syed Arij Aziz
(404809)
Wassi Haider Kabir (410398)
Ayesha Nahman
(424154)
Ahraf Fatima
(414862)
Wahhaj Waheed
(423280)
December 5, 2023
Executive Summary:
Zoro Tech Ventures, Inc. is embarking on a transformative initiative to establish a
semiconductor and silicon chip manufacturing facility in Pakistan. In response to significant
financial losses incurred due to import challenges, the company envisions a strategic shift
towards local production. Over the past two decades, Zoro Tech Ventures, Inc. faced obstacles
such as shipping delays, import bans, and tax hikes, resulting in cumulative losses of $500
million USD. The proposed solution involves a 10-month timeline, including land acquisition,
infrastructure development, machinery procurement, workforce training, and prototype testing.
The objective is to position the company as the sole semiconductor manufacturer in South Asia
and the Middle East, catering to the burgeoning demand in the subcontinent. The estimated
project cost is $8,736,105,000, with a payable cost of $1,747,221,000. Financial projections
anticipate net income almost trifold over the first two operational years. The proposal
emphasizes strategic planning, continuous improvement, and a commitment to technological
independence and economic growth for Zoro Tech Ventures, Inc. and the region.
Zoro Tech Ventures, Inc. shall become the sole manufacturer and provider of the said
products in South-Asia and the Middle East. Because of the manufacturing process,
semiconductors and microcontrollers are inherently challenging to make. The only three
companies in the world that have the machinery and modern lithography processes to create
such
silicon
chips
profitably
are
TSMC,
Intel,
and
Samsung.
Table of Contents
Contents
Executive Summary: .................................................................................................................. 2
Introduction: ............................................................................................................................... 3
Background: ............................................................................................................................... 4
Problem Statement: .................................................................................................................... 5
Purpose and Objectives: ............................................................................................................. 5
Timeline: .................................................................................................................................... 7
Stage 1:................................................................................................................................... 7
Stage 2:................................................................................................................................... 7
Stage 3:................................................................................................................................... 7
Stage 4:................................................................................................................................... 8
Market and Competition: ........................................................................................................... 9
Market Demand: .................................................................................................................... 9
Costing and Budget:................................................................................................................. 11
Financial projections after completion: ............................................................................... 11
Pro forma balance: ............................................................................................................... 12
Conclusion: .............................................................................................................................. 13
Introduction:
Semiconductors and Silicon chips are one of the key components required for the
manufacturing of our products. They are directly and indirectly imported from Taiwan, and
USA. We engage in periodic shipment transactions with the providers subject to a lot of
variables such as Government Import Policy, market demand, costing, shipping
inconveniences. Not only in our products but generally Semiconductors and Silicon chips are
extensively used for manufacturing of almost every electronic device. From Television to
latest Weapons systems, everything contains chips.
This business plan proposal shall suggest a new direction that could take Zoro Tech
Ventures, Inc., to new heights and open a new horizon of customers both business-tobusiness and business-to-consumer. We shall address all the issues faced in the current
method of procurement of Semiconductors and Silicon chips and turn that problem into a
galvanizing opportunity.
This proposal aims to achieve, setting up a world class Semiconductors and Silicon
chips manufacturing factory by Zoro Tech Ventures, Inc. in Pakistan. This shall not only
serve in facilitation of our current line of products but also provide a new international
clientele base comprising of regions including South-Asia and Middle East, as Zoro Tech
Ventures, Inc. shall then be the only Semiconductor and Silicon chips manufacturer in the
region.
Background:
We as a group of individuals have been working with Zoro Tech Ventures, Inc. for
quite some time now and have noticed a few redundancies where the supply of the said
components is concerned. We have carefully formulated this proposal to address such
problems.
In March 2015, the company suffered a loss of almost 10 million USD due to delay in
the shipping of Silicon chips. Furthermore, due to the current import bans and tax hikes, the
company is expected to face an impact of almost 50 million USD. In total the losses faced by
Zoro Tech Ventures, Inc. due to import of Semiconductors and Silicon chips is estimated to
be around 500 million USD in the past 20 years.
Problem Statement:
Over the past two decades, the semiconductor and silicon chip import market share has
significantly shifted to Asian countries due to a significant rise in electronic equipment
production, especially Pakistan emerging as one of the prime consumers.
In order to meet the intensifying demand, Pakistan currently has to import a remarkable
number of semiconductors and silicon chips from Countries like Taiwan, China, and United
States of America. In a recent report issued by express tribune; Pakistan became the 32nd
largest importer of semiconductor devices worldwide in 2023 after bringing in $602 million
worth of goods1. Furthermore, semiconductor devices have been ranked amongst Pakistan's
20th most-imported goods this year. This hefty import rate has affected Pakistan in almost all
the areas of production market, and the pressure to cut costs is being felt at every stage of the
supply chain, including procurement, production, and shipping.
At the stage of procurement, the major obstacle being faced is the foreign exchange risk
as the procurement of the raw products depends entirely on the imported goods, which are
highly influenced by the value of the Peso. If the Peso falls in value, its effects are faced by the
whole market. At the stage of production, ready-made semiconductors and silicon chips
significantly steal the employment opportunities followed by deflective effects on the economy
of an already crisis hit Nation like Pakistan, hence altering the whole balance between
consumption and conservation.
Upon detailed evaluation we found that this problem effects Zoro Tech Ventures, Inc.
gravely in numerous ways.
•
•
•
•
The unstable tax policy of Government on import items.
Time delays in shipping and processing of chips
Accidents, losses and extra cost faced in shipping
Poor after-sale service of defective pieces
Purpose and Objectives:
In a modern technological world, it’s a well-established fact that advanced
semiconductor performance is vital for enabling advance market demands such as machine
learning, vehicle electrification, and high-performance computing, and along with this
supporting our National as well as International Interests.
1
Express Tribune, Pakistan
Following crucial objectives can be achieved by locally manufacturing and selling
semiconductors and silicon chips:
2
•
The Global semiconductor chip Crisis2 has started to haunt Pakistan too, as a monthlong delay has been observed at the delivery of electric vehicles and other high
performance computing devices. Local manufacturing of semiconductor and silicon
chips in Pakistan will allow our national industry to not be affected by this global
shortage and prosper independently.
•
Zoro Tech Ventures, Inc. will no longer have to wait for the long shipping time and
their finished goods production will increase exponentially matching the demand.
•
There is no current Semiconductor or Silicon Chips manufacturer in the South Asia or
Middle east. This opens an immense export market. Zoro Tech Ventures, Inc. can not
only increase their efficiency and manufacturing prowess but sell these chips as a
primary product globally.
•
Local production provides new employment opportunities and opens new gates of
progress for our own people, indirectly improving the whole economy.
•
By locally producing semiconductors and silicon chips, which are used in such diverse
array of industries, Zoro Tech Ventures, Inc. can enable this production to strengthen
Pakistan’s national security by achieving Industrial independence.
•
As with any other international trade, there is always a political interference associated
when importing goods which can hinder the individual progress. Local production
enables the industry to flourish without any international politics involved.
•
If Zoro Tech Ventures, Inc. enable their engineers and supply chain, enough to start
producing the annually required number of semiconductors and silicon chips in an
efficient way, then it will serve as way more cost effective option than importing.
Daily Dawn, Pakistan
Timeline:
Stage 1:
Land Acquisition and Plant Design (1 month):
We will spend the first month of our business plan's initial phase finding suitable land
for our production facility and finishing the design. This critical step involves carrying out indepth due diligence on possible sites, taking into account variables including zoning laws
compliance, accessibility, and closeness to suppliers and markets. Our team of engineers and
architects will work simultaneously to develop a comprehensive design that adheres to safety
regulations, maximizes available space, and encourages efficiency. A seamless and
productive production process is based on careful facility design and efficient land
procurement.
Stage 2:
Infrastructure and Construction (3 months):
After land is acquired and the factory design is finalized, the next six months will be
spent developing and building the infrastructure. This includes setting the foundation,
building the required structures, and setting up the utilities. Our goal will be to build a
cutting-edge facility that promotes sustainability and environmental concerns in addition to
meeting operational needs. Strict project management will guarantee that work moves
forward as planned while upholding quality and safety requirements all along the way.
Procurement and Assembling of Machinery (3 months + 15 days):
Following the establishment of the necessary infrastructure, we will place our
factory's necessary machinery orders. It is projected that the procurement process, accounting
for delivery schedules, research, and negotiations, will take about three months. A committed
team will put in endless effort over the next 15 days to assemble and install the machinery
after it arrives. For the machinery to be seamlessly incorporated into our manufacturing
processes, this phase is essential.
Stage 3:
Workshops and Machine Handling Training (1 month):
Recognizing the value of competent workers in the manufacturing business, we will
set aside one month for intense workshops and training sessions. Our employees will be
trained on how to operate and maintain the machinery. This stage seeks to improve not just
our team's technical proficiency, but also to develop a culture of safety and efficiency in our
daily operations. Well-trained employees play an important role in optimizing manufacturing
processes and providing a safe working environment.
Stage 4:
Prototyping and Test Production (1 month):
One month of testing and production will be devoted to prototyping and test
production after the factory is fully operational. This stage entails optimizing our production
procedures, spotting possible bottlenecks, and making the required changes. Through
prototyping, we may evaluate the quality of the final product, optimize production processes,
and make any necessary adjustments prior to the start of large-scale production. The
knowledge acquired at this time will be extremely helpful in maximizing productivity, cutting
waste, and guaranteeing that our goods satisfy the highest requirements.
This detailed timeline illustrates our dedication to careful planning, effective
implementation, and ongoing development as we set out to create a state-of-the-art
manufacturing plant. In total, within 10 months of the project’s initiation, we shall be ready to
take over the market.
Project Timeline
1-Jan
20-Feb
11-Apr
31-May
20-Jul
8-Sep
28-Oct
17-Dec
Stage 1
Stage 2
Stage 3
Stage 4
Start Date
Duration (Days)
Stage 4
15-Sep
Stage 3
15-Jul
Stage 2
1-Feb
Stage 1
1-Jan
60
30
135
30
Gantt Chart
Market and Competition:
Market Demand:
Pakistan is a developing 3rd world country trying to revolutionize itself. It has started to
export its IT skills to the world3. 20% of GDP was due to increase in freelancers in the IT
sector.
Pakistan is also increasing its revenue attained through industries by setting up more
factories4. In this process, usage of modern machinery and technology is essential.
Businesses are taking advantage of this and are providing said tools with the required
expertise. However, the importing costs of microcontrollers is taking its toll and small
businesses are having trouble to secure profitable deals to manufacture modern devices/tools.
The same trend can be observed throughout the subcontinent. By opening our services at this
pivotal moment, we can not only secure the Pakistani market, but potentially the entire
subcontinent.
Competition:
Semiconductor and microcontrollers are innately difficult to produce due to the
manufacturing process. Modern lithography techniques and machinery to profitably produce
said silicon chips is only possessed by 3 companies in the world; TSMC, Intel, and Samsung.
As such, the competition is low while the demand is forecasted to increase annually by 15%5.
Supply chain issues along with rising cost of manufacturing silicon chips6 further indicate
that the competition is unable to fulfill the demand of Pakistan and surrounding countries.
Due to local production of microcontrollers, we are also able to save costs in shipping and
can form contracts with local manufactures and provide them competitive quotes without
lowering our profit margins.
Rise of a New Industry, 2022, The Express Tribune
Re-entering the 1960s period, 2023, The Express Tribune
5
The New Gold rush, 2023, New York Times
6
Global Village with broken roads, 2022, New York Times
3
4
Initial Targets in the Market:
The following areas are to be our main goals:
1. Providing Entry level chips for common household appliances such as fridges, AC,
calculators, microwaves, etc.
2. Providing Mid-level chips for complex machinery such as industrial robots, hybrid
cars, security cameras, etc.
3. Providing various basic transistors production for more complex PCB designs
Market penetration in these crucial areas will help cement our brand and become a common
staple in the microcontroller industry.
We also plan to offer custom microcontroller design for those interested in designing their
own chips after accomplishing our initial goals.
Costing and Budget:
Land Aquisiton
Legal Proceedings
Lithography Machinery Acquisition
Transportation
Factory/Building Development
Staff
Total cost
Borrowed
Interest rate
Time Period
Net cost
1,000,000$
25,000$
8,700,000,000$
30,000$
350,000,000$
50,000$
8,736,105,000$
6,988,844,000$
0.8%
20 Years
1,747,221,000$
Financial projections after completion:
Year 2025
Net sales
16,000,000$
cost of goods
gross income
4,000,000$
12,000,000$
Operating expenses
labor
insurance
utility
Delivery
Miscellaneous
Total Expense
80,000$
5,000$
25,000$
15,000$
15,000$
150,000$
Net income
1,050,000$
Year 2026
Net sales
cost of goods
gross income
56,000,000$
14,00,000$
42,000,000$
Operating expenses
Labor
insurance
Utility
Delivery
Miscellaneous
Total Expense
100,000$
5,000$
30,000$
15,000$
15,000$
170,000$
Net income
41,850,000$
Year 2027
Net sales
cost of goods
gross income
260,000,000$
65,000,000$
195,000,000$
Operating expenses
labor
insurance
utility
Delivery
Miscellaneous
Total Expense
120,000$
5,000$
40,000$
15,000$
15,000$
185,000$
Net income
194,850,000$
Pro forma balance:
Dec jan 2025
Current assets
Cash
100,000$
Account receivable
650,000$
Inventory
Total current assets
300,000$
1,050,000$
Fixed asset
Building
Lithography Machines
Gross fix asset
Total Asset
350,000,000$
8,700,000,000$
9,050,000,000$
9,051,050,00$
Borrowed asset= 6,988,844,000$
Total Liability = 349,442,200 + 0.8% interest
= 352,237,737$
Owner Equity= 2,340,560,000$
Estimations show that we will be able to reach break-even point 10 years after operation.
Conclusion:
Manufacturing of semiconductors and silicon chips In Pakistan involves logistical and
technical challenges. However, it is quite achievable if we streamline it, and timelines are
strictly adhered to. Shipments must be booked at least 3 months before the required delivery,
foreseeing the cargo shipment might fluctuate the delivery time. Assembly of parts is timeconsuming and needs technical assistance to ensure accurate and efficient setup. The greater
the time allocated to it, the more with standing cost of the warehouses and ultimately delayed
production.
•
Selection of a suitable location for the manufacturing facility, preferably Karachi with
easy access to ports, facilitating the import of machinery. It also has industrialized zones
with land and energy subsidies to help cut functional costs.
•
Training personnel on the ground to ensure optimum usage of machinery requires
training sessions from the pre-experienced workforce for a smooth transition. We shall
start it off with small-scale production to identify and address any issues and scale it up
gradually while implementing continuous improvement measures.
•
We shall launch marketing campaigns to promote locally manufactured
semiconductors, and establish sales channels, partnerships, also attend industry events
and conferences, to tactfully place our product for potential clients e.g. Samsung,
Huawei.
•
Success lies in optimizing the manufacturing of the product and staying relevant to the
market you are catering to. Enhance supply chain efficiency and promptly mitigate
potential challenges.
•
Regular review of financial performance in contrast to tentative projections, looking
into exploring product diversification and market expansion and seek customer
feedback for improvements in terms of quality and customer services. Scaling up
production based on demand.