Need Gap The customer who wants to wear western wear is looking for variety and a wide range of such apparels. Consumers today demand a traditional yet contemporary look for their ensembles. The products have in turn adopted this theory to give out fresh designs and prints to the closet. Women’s wear has undergone a drastic transformation & now people have become more experimental and want a combination of both ethnic and western wear. Popular brands like fabindia, W , Anokhi have western clothing with indian prints but lack modern prints and variety. Variety offered in western wear with Indian touch under various brands 46% 27% 8% 2%2% 5% 2% 3% Anokhi Bangkok Biba Desigaul Fabindia Global desi Janpath Sampada Sarojni W No MEZCLA is providing customers a young fashion wear in wide variety by fusing the western silhouettes & Indianising the same with the use of indian & traditional prints. 50% 40% 30% 20% 10% 2% 3% 0% http://retail.franchiseindia.com/magazine/2008/november/Ethnicity-personified_22-2-5 18 -24 Yrs 25-31 Yrs Market potential Currently, India is the second largest country in the world after China in terms of a population of 1.15 billion. Between 2010-2030, India will add 241 Million people in working-age population Demographic - 50% of its population is below the age of 25 and more than 65% hovers below the age of 35. The Young and working population of India is the biggest positive factor for India and its growth in coming years The Indian women apparel market has undergone a transformation over the past few years--- changing fashion trends, rising level of information and media exposure Entry of large number of foreign brands have given the industry a new dimension. In 2010, the market size of western wear is more than Rs.42,180 Crore, an increase of 14% from 2007. With the growing presence of organized retail and rapidly spreading mall culture, the industry is all set to grow further in the future, according to "Women Wear Market Forecast to 2010” Increasing at a CAGR of over 17%, the women's apparel market is expected to cross Rs. 61,000 Crore by 2010. Branded women’s apparel market is projected to rise at a rate close to 25% and surpass Rs. 18,000 Cr. by 2010. Premium segment apparel is forecasted to account for close to 20% of the total women’s apparel market by 2010. http://www.articleshub.org/article/7000/Women-Wear-Market-Forecast-to-2010.html http://en.wikipedia.org/wiki/Demographics_of_India inventory personification western silhouettes Indian prints vibrant colours jugalbandi female young traditional yet modern experimental confident lively and vibrant smart and trendy outgoing ambitious charismatic trendy dresser lives life to the fullest stylish innovative Competitor Analysis 2 categories in women wear WOMEN INDIAN – Long kurtis, short kurtis, supershort kurtis and churidars( core products) Target customer- 21 years and above WOMEN WESTERN- semiformal, skirts, dresses, tunics, trousers, short kurtis in western styles( core products) Target customer- 18 years and above Price range- Rs 560- Rs 1190 ( basic garments) Rs 1200- Rs 2490 ( fashion basic) Rs 2500- 4000 (fashion garments) USP OF FABINDIA Promoting Indian crafts and weavers in its products supply chain of fabindia SUPPLY CHAIN- north region 100 – 200 weavers 17 SRC MRW1 SRC- SUPPLY REGION CHANNEL ( 17 ) MRW- MARKET REGION WAREHOUSE ( 9 ) vendor Amritsar, Ranjit Avenue Bhopal, TT Nagar Chandigarh, Sector 9C Dehradun, Rajpur Road Indore, M.G. Road Indore, Treasure Island Mall Jalandhar, Urban Estate Karnal, Jarnali Colony Ludhiana, Mall Road New Delhi, Connaught Place New Delhi, CP2 New Delhi, DIAL New Delhi, Dwarka New Delhi, GK1 N14 New Delhi, Green Park New Delhi, Khan Market New Delhi, North Campus New Delhi, Rajouri Garden New Delhi, Select Citywalk Panchkula, Sector 9 Patiala, New Leela End consumer brand audit of fabindia WHAT SPRINGS TO YOUR MIND HUGE VARIETY PRINTS CLASSY ETHNIC WEAR MODERN INDIAN COLOURFUL CASUAL KHADI INDIAN COLOURS MIX MATCH WHAT ELSE COMES TO YOUR MIND COTTON BLUE COLOUR KURTA RELIABLE MODERN INDIAN TOUCH BROWN PAPER BAG REASONABLE PRICES MIX MATCH THE NEW RANGE INDIAN OTHERS WEARING IT GOOD CHOICE SENSIBLE BUYING KNOWN BRAND JEALOUS STYLISH INTELLIGENT CULTURED SIMILAR TASTES SMART INDIAN AT HEART SELF IMAGE CONFIDENT SMART MODERN CLASSY SATISFIED FEEL AT EASE DIFFERENT CLOSER TO HOME GRACEFUL POSITIVE MEMORIES SIMILAR BRANDS FIRST SALARY GIFT BIBA GIFTS HAS NO GOOD EXPEREINCE COMPETITOR COLLEGE DAYS W SHOPPING WITH ALL ARE SIMILAR FRIENDS ANOKHI BUYING SIMILAR FABINDIA HAS OUTFITS THE MAXIMUM REGULAR SHOPPER VARIETY GOOD ATMOSPHERE FABINDIA IS ONE SHOPPING FOR OF A KIND SPECIAL OCCASSIONS COTTONS NONE WELL ESTABLISHED BRAND GOODTHINGS SWOT ANALYSIS Strength Weakness Wide variety of prints that are not available with various other competitors. Blend of two cultures under one roof. keeping the culture alive Keeping the consumer close to her roots. In some parts of India like Bihar, the acceptance for such clothes is less, so there is a possibility that this concept would not be accepted by many people in such cities. Opportunity Threats Less competitors Increasing inclination towards WESTERN look Untapped market clothing in vogue Increasing disposable income with youngsters People more fashion conscious, experimental To go global Can be a fad Competition from unorganized market that provide such apparels at cheaper prices Competition from established and known brands among the customers like Anokhi and Fabindia Duplicity of prints and styles Competition from boutiques There is no prior business experience in this field MTV RADIO MOBILE MUSIC PLAYER REST SIT WITH FAMILY IPOD INTERNET CHAT GET READY FOR MAGAZINS NEXT DAY Go to bed 11-1 am Dinner REST 9-10 pm TV MOBILE IPOD INTERNET EAT HANG OUTMOVIE HALL COFFEE JOINTS WORK TEMPLE- TUESDAY, THURSDAY MC DONALDS SUBWAY LAYS COKE PEPSI APPLE 93.5 FM ADS- LIFESTYLE PRODUCTS COLORS MTV FACEBOOK GOOGLE ORKUT FEMINA COSMO VOGUE DELHI TIMES NEWS VH1 NESCAFE NESTLE DETTOL GARNIER PVR CCD MOCHA MUSIC MTV HBO NDTV GOOD TIMES Wake up 6.30-7.00 am GET READY PRAY TO GOD HAVE BREAKFAST PICK LUNCH DILO WEEKDAY Leave from work RADIO /college MOBILE HOARDING 4.30-7.30pm CAR AUTO OFFICE BUS CARPOOL TAKEAWAY MUSIC PLAYER CDs IPOD COLGATE HT DOVE 93.5 FM LUX PANTENE NIVEA GARNIER LOTUS KELLOGES BODYSHOP NESTLE AMUL KISSAN NESCAFE TAJ TIMES MAC LAKME LOREAL REVLON RADIO NEWSPAPER MOBILE APPLE 93.5 FM SAMSUMG BLACKBERRY NOKIA ADSLIFESTYLE PRODUCTS Reach at 9 -9.30 AM Leave for work 8.00-8.30 am TRAVELCAR AUTO OFFICE BUS CARPOOL CLASS WORK LUNCHCANTEEN FOOD JOINTS INTERNET MAGAZINES BOOKS MUSIC MOBILE RADIO MOBILE HOARDING MUSIC PLAYER CDs IPOD FACEBOOK GOOGLE CCD BARISTA SUBWAY BISLERI KENLEY Go to BED 11.30-1.30 TV RADIO MOBILE REST MUSIC SIT WITH FAMILY PLAYER CHAT IPOD WORK INTERNET MAGAZINES NIGHT OUT- 11 ONWARDS CLUBS DISCOs BARS LOUNGE Dinner with family 9-11 pm MOBILE AT HOME IPOD RELATIVES RADIO 5 STARS RESTURANTS TEMPLE- SATURDAY GURUDWARAS COLORS MTV FACEBOOK GOOGLE ORKUT FEMINA COSMO VOGUE DELHI TIMES NEWS VH1 HAVE BREAKFAST RELAX SIT WITH FAMILY LUNCH F-BAR AGNI QBA AQUA HYATT SIDDHARTHA PUNJABI BY NATURE MAINLAND CHINA RADISSON Leave For home 7- 8.30 pm APPLE 93.5 FM 98.3 FM ADS- LIFESTYLE PRODUCTS Wake up 9- 10.30 am CAR AUTO CARPOOL DILO WEEKEND RADIO MOBILE HOARDING MUSIC PLAYER CDs IPOD COLGATE HT DOVE 93.5 FM LUX PANTENE NIVEA GARNIER LOTUS KELLOGES BODYSHOP NESTLE AMUL KISAN NESCAFE TAJ TIMES MAC LAKME LOREAL REVELON PARACHUTE RADIO NEWSPAPER MOBILE MAGAZINE TV APPLE 93.5 FM SAMSUMG BLACKBERRY NOKIA ADSLIFESTYLE PRODUCTS leave with friends4-5 PM Reach at 5 6 PM FOOD JOINTS MOVIE MALLS CAFÉ s TRAVELCAR AUTO CARPOOL METRO INTERNET MAGAZINES BOOKS MUSIC MOBILE BANNERS RADIO MOBILE HOARDING MUSIC PLAYER CDs IPOD BIG CHILL MOCHA BARISTA PVR SELECT CITY AMBIENCE PROMENADE EXPERIMENTAL TRENDY SMART EARLY ADOPTORS CONFIDENT WANT TO LOOK YOUNG LOVE TO SHOP- MALLS, HIGH STREET LOVE COLOURS LIKE TO DRESS WELL LIKE TO ACCESSORIZE EXPERIENCERS- energy, spent heavily on clothing, music SPEND TIME WITHCUSTOMER INSIGHTS EARLY MAJORITY FAMILY BELIEVE IN GOD LIKE CELEBRATING INDIAN FESTIVALS FEEL YOUNG BRAND CONSCIOUS INDEPENDENT FOLLOW LATEST TRENDS HANG OUT WITH FRIENDS SPENDS WEEKENDS WITH FAMILY AND FRIENDS WORSHIP AT TEMPLES & GURUDWARAS FASTING ON VARIOUS OCCASSIONS READS MAGAZINES- VOGUE, FEMINA BRAND AWARENESS NIGHT PARTIES WITH FRIENDS AND COLLEAGUES LIKE TO LISTEN TO ALL KINDS OF MUSIC TARGETING Demographics Geographics DELHI, MUMBAI, KOLKATA, PUNE, CHANDIGARH, HYDERABAD, BANGALORE & MANIPAL etc. INTERNATIONAL MARKET-UKlondon AGE- primary target 18-24, secondary target 2531 YEARS GENDER- FEMALE INCOME- 1 LAC & ABOVE PER MONTH OCCUPATION- STUDENTS, WORKING PROFESSIONALS TARGETING Psychographics ATTITUDE- EARLY ADOPTERS, EXPERIMENTAL, TRENDY, POSITIVE OUTLOOK, EARLY MAJORITY, EXPERIENCERS INTEREST- FOND OF READING FASHION MAGAZINES, LISTENING TO MUSIC , LIKE TO ACCESSORIZE , SHOP LIFESTYLE- SOCIAL, BUSY OPINION- OPINIONATED, SPEAK THEIR MINDS. RESPECT OTHERS OPINION Behavioral USAGE- MODERATE TO HEAVY BUYER READINESS- AWARE, INFORMED, POSITIVE BENEFITS SOUGHT- CASUAL WEAR, MODERN YET INDIAN FEEL TO THE GARMENTS BRAND PRISM Physique Western silhouettes, logo, Indian prints , Colours Personality Funky, cool, confident, Independent, experimental Culture Relationship bridging the gap Reflection This jugalbandi is cool To bridge the gap between Indian and western culture by providing a blend of both to young women in an innovative style Jugalbandi, blend Self Image Thats the way I am CREATING PRODUCT DIFFRENTIATION POSITIONING POD POP ONE STOP SHOP GOOD QUALITY FABRIC, NICE FIT, INHOUSE STYLIST PRINTS POSITIONING STATEMENT To young and vibrant fashionistas who are attached to their culture, mezcla is an apparel brand that gives them a one stop shop for the most stylish and trendy blend of both the western and Indian cultures to achieve their aspired look. USP OF Mezcla VAST VARIETY OF SUCH CLOTHING UNDER ONE ROOF COLOURS & PRINTS IN-HOUSE STYLIST INDIAN PRINTS ON WESTERN SILHOUETTES Mezcla product mix Brand Architecture Basics Fashion Basics Fashion Merchand ise Tops Tops Tops Bottoms Bottoms Bottoms Layering Layering Dress Mezcla basic top-costing Basic Top (cost per unit) Direct Cost Fabric 1 Count Width Linear Weight Total consumption per unit Fabric 2 (Fabric 2 includes laces, zip ,buttons, velcro, shoulder pads, linning, etc ) Brand Label Wash care label Size label Packaging Total CMT CMT cost per unit 40 Rs/mt 60s 42" 190 GSM 1.75 mt (including wastage) 10 Rs /Unit 3 Rs 2 Rs 1 Rs 10 Rs 96 Rs 50 Rs (250/8=31.25 31.25x1.6) Finishing cost 10 Rs (20% of 50 Rs) Total Direct Cost 96+50+10=156 Rs Indirect Cost 16 Rs ( 10% of 156 Rs) Manufacturing Cost 47 Rs ( 30 % of 156 Rs) cost per unit 156+16+47=219 Rs SCM & Logistics cost 16 Rs(7% of 219Rs) Total 235 Rs Freight Cost 16.50 Rs ( 7% of 235 Rs) Total cost 251.5 Rs Vat (20%) 50.5 Rs LDP 251.5+50.5=302 Rs Total cost of good including all expenses 302 Rs and overheads MRP 830-981 Rs Mezcla pricing Price Range of Mezcla Basics Top 830-981 Rs Bottom 932-1161 Rs Fashion Basics Top 1190-2115 Rs Fashion Merchandise Top 2354-2990 Rs Bottom Bottom 1240-2217 Rs 2490-2990 Rs Layering 1440-2790 Rs Layering 3040-3990 Rs Dresses 2490-3990 Rs Strategies adopted by mezcla Pricing ObjectiveStatus Quo Client CenteredSelling Strategy Pricing StrategyCompetitive Market CoverageIntensive Distribution Channel strategyPull Strategy Place DOMESTIC SUPPLY CHAIN Company send PO to production House End Customer •Fabric lot provided by the order company •Production will be monitored by the order company Khan mark et cp ambi ence Production House Sent for embellishment Semi-Finished Good MILK RUN Carton Loaded by Production House Production house agreement Production house scans the file and makes a dispatch document of semi finished Goods Packing List Quantity List Truck Receiver Commercial Invoice Naraina Warehouse Carton Loaded by Company GIP.n oida CITYW ALK, SAKET Company agreement Proper quality & quantity checks take place before receiving the goods Lot Size Quantity Size Price list Goods receive note Inspiration Ideation Gupta Traders street No67 Karol Bagh Lyallpur Instyle Lyallpur Fabrics Rajouri Garden Minimum lot size 300-500 mt Lead time 21 days(as per requirement ) Width 63 inch Keep in warehouse Naraina Interpreting from trend forecast agencies http://www.vogue.in/T rends?utm_source=Go ogle&utm_medium=cp c&utm_campaign=Goo gleAdwords http://www.fashiontre ndsetter.com/content/ color_trends.html Lead time-2-5 days Selecting Trends and create new ideas Prototype Approval Fabric Sourcing In-house approval by other department 1-2 days Printing & art work In-house Lead time 4-7 days Sobtis Gallery Ramesh nagar/ C L Export East patel nagar/ Kiran Export Arya samaj Road Uttam nagar Lead time 10-15days Prototype sampling In-house Lead time 7-10 days Final Products Consumer Feedback Trend ,Ideas & research handed over to design team Designing In-house In-house- 21 days Production and finishing & labeling Semi-Finished Good Quality checker will monitor the production process In-house lead time 1- 2 days Embellishment , finished good Consumer Research Data retrieved from famous agencies like http://www.marketsearch.com/news01. html And marketing Department done Primary & Secondary Survey research Lead time-2-5days Packaging Maximum lead time- 90 days Packaged Finished Good Order dispatch as per quantity required for the store Retailer End customer Lead time 1-2 days Managing Director Marketing & Sales Department Finance Department •Budgeting & forecasting the financial condition •Cost management •Asset management •Revenue generate Finding need Gap Analysis the market and consumer 5 IT & Documentation Merchandising 1 2 Research and Design the product according to the need gap Administration/HR D Documented all the transaction While sourcing The raw material Production System Packaging System Supply Chain System Design approved and dispatch for proto type making 3 Training Programme According to the Product Inventory management Implement marketing strategy according to the product and consumer 12 Logistics & Transportation Warehouse 10 11 end customer 14 Sourcing the raw material and make prototype and send for final approval 7 6 While While production production quality will fabric is allot monitor by order company Production production product go to finishing & 8 After embellishment department Finishing & Embellishment Finished good Ready in warehouse Retailer 13 4 After final approval prototype go for production R&D 9 global Matrix Highest Shopping Destination Holiday Destination Per Capital Disposable Income Trading partner System of taxation & Regulation Inclination Towards Indian Culture 141190 50 m USD 1 2 1 $33,697 Canada give foreign investors unparalleled operational freedom Fond of Indian culture 2.5 million 217885 6 m USD 3 3 2 $15,630 USA Less taxes on business .vat paid by customer Very fond of Indian culture, fusion clothing brandmonsoon 265904 994246 m USD 4 5 3 $ 13,296 China Goods and services Latest incidents of attack on Indians Indian Population GDP USA 2,800,00 0 UK Australia countries Rental Tax (GST) Singapore 417559 182231 m USD 5 4 4 $ 9,603 Malays ia Easiest place to do business Not much inclination towards Indian culture Dubai 1126422 223874 m USD 2 1 5 $14400 India No tax jurisdiction after FZE- free zone establishment More Muslim culture, less acceptance of modern clothing UK Female population under the age of 15-64 years is 20,246,519 Highest demand in clothing sector is for women’s wear(53%) No franchise law. Code of ethical conduct is adopted while doing any franchise business Indians in UK constitute about 6% of the GDP and 4% of population The Monsoon brand in the UK works on similar concept as Mezcla. There are 400 Monsoon and accessories store in the UK . Age Structure Clothing sector breakdown 1.60% womenswear 20% 26% 53% 16% 17% 0-14 years menswear 15-64 years childrenswear 65 years & abv. accessories 67% LONDON British Indians are London's largest ethnic minority group (7%) More than 160 Indian MNCs The Indian migrants are very nostalgic about their parent country. Keen to maintain an active cultural and spiritual link to India. There are over 10,000 Indian owned businesses in London . The Indian community in London is very active culturally. It organizes cultural and religious festivals to maintain its ties with India. London offers an enormous variety of Indian shops selling specialist food, herbs and spices, clothes, accessories and services. Now home to 1,73,000 overseas nationals from India, London accounts for over a third of the United kingdom total. Kensington highstreet Kensington high street is the 2nd best shopping street in London, serving a wealthy area. There is an institute of Indian culture, Bhartiya Vidya Bhavan , for Indians living there Presence of famous Indian restaurants called Zaika, Ustav, Rasoi Kitchen Total of 350 brands in approximately 18000 customer visiting the shops per weeks. High density residential areas (Brent, Ealing and Hounslow) with 10,000 Indian people are next to this high street. Communities with significant Indian populations 7.50% 8.80% 0 6.50% 10.00% 22.00% 12.10% 18.30% 18.10% 14.30% 15.00% Community Greater London Harrow Hounslow Brent Ealing Redbridge Newham Hillingdon Barnet Croydon MONSOON In May 1973, the first Monsoon shop opened in Beauchamp Place, Knightsbridge, London. Monsoon Accesorize’s prestigious Head Office is located in Notting Hill Village, West London. Monsoon has expanded rapidly from its London base. Today there are over 400 Monsoon and Accessorize stores in the United Kingdom and over 600 throughout the world. In-house designed collection of unique classic pieces, that range from sophisticated evening to casual day wear, and combine feminine styling with exotic colour, beautiful fabrics and detailed finishing. MONSOON PRICES Dresses- RS 3240- 14400 Coats- RS 5760- 13000 Top- RS1800-3240 Trouser -RS 2880- 7200 skirts - RS2880- 5500 Mezcla promotion Mezcla prelaunch- may FACE OF MEZCLA HOARDING NEWSPAPER-DELHI TIMES, FRONT PAGE, 4 ADS Allotted space in the news paper- 20x12=240 sq cm Prescribed day of publishing the advertisement Sunday( 4 week)- 3654240 Rs MAZAGINE- FEMINA & VOGUE, 2 ADS, FULL PAGE ( THICK PAPER, WITH HALF LAP) FEMINA AND VOGUE magazine Page –monthly edition -875000 Rs WEBSITE ON GOOGLE SEARCH ENGINE as Top priority website Total cost –605000 Rs INTRODUCING MEZCLA BRAND ON FACEBOOK , Mezcla face hunt Charge = 200000 Rs BANNER IN MALL -3 - 720000 Rs Hording on Flyovers in Delhi -3 -1326000Rs PROMOTIONAL SCARF-20000 scarves Cost per scarf- Rs 6, total= 120000 RADIO SPONSOR(93.5) – RJ Nitin of Red FM, 800 Rs for 10 sec Total- 300 sec Total cost =24000Rs M COMMERCE-10 lakh sms 4 times repetition in a month Total cost=80000 Rs BANNER All year round NEWSPAPER, DELHI TIMES, PAGE 3 – 1 AD PER MONTH MONDAYS- 8*10 CM COST PER AD=132400 132400*11=1456400 TOTAL COST= 1456400 Rs June, July, August RIBBON CUTTING BY PRIYANKA CHOPRAlaunch- JUNE cost to get Priyanka Chopra- 25 lakhs+ 5 lakhs 30 lakhs total cost= 30 lakhs+1 lakhs= 31 lakhs FEMINA AND VOGUE INSERSIONS- 1 insertion in every alternate issue 5 INSERSIONS each in both magazine Total cost= 22.25 lakhs RADIO SPONSOR(93.5) - RJ Nitin of Red FM, the voice of Delhi’s morning show 800 Rs for 10 seconds 200*11=2200 2200*80=176000 PROMOTIONAL UMBRELLAS - JUNE will be given for a month to all those who buy Total cost= 176000 Rs from Mezcla. total cost= Rs 88000 M COMMERCE Mobile SMS = 1000000x.02=20000 Rs (www.nimbusitsolution.com) IN A MONTH= 1 repetition 11*20000=220000 Total cost= 220000 September, October, November December, January, February FASION MERCHANDISE BY DESIGNER- august EVENT SPONSOR- December College fest Sponsor Autumn fashions by Wendell Rodricks South Campus – 1 reputed College- JMC Total Sponsor funds=500000 Rs Total cost= 15 lakhs Total cost= 5 lakhs WADROBE SPONSOR- February Wardrobe Sponsor for Reality Show on Television- ROADIESRs 400000 Cost of Sponsor per Reality Shows = for one show ( Excluding Apparel and Accessories’ ) This 3-4 L cost for showing our name as a wardrobe sponsor in every 8 Min and every time after the break and announced in every 8 min by the anchor of the show. Total cost= 4 lakhs Mezcla tongue twister Mezcla claims miss slips, miss slips claims Mezcla EVENT SPONSOR - February College fest Sponsor North Campus – 1 reputed College- Hindu Total Sponsor funds=500000 Rs Total cost= 5 lakhs March, April, may Fashion show BY MEZCLA- March Pass allows 2 persons Fashion Show- To launch spring collection Intended Invite media – Print media- The times of India, Hindustan Times, Femina, Vogue etc Ad media- NDTV, Times Now ,MTV, NDTV goodtimes Intended invite Designer-3 Cost of Invitation of designers-10 lakhs Place – Hyatt Regency Hotel Cost of Booking-12 Lakhs( including ramp, lights, sound) Cost of Models – 7 Lakhs( including choreography ) Cost of snacks and drinks – 6 lakhs Total cost- 30 Lakhs This invitation will be given to Loyalty card holder-300 Total cost= 35 lakhs ADVERTISING BUDGET =21853000 Rs total spent =2,12,69,640 Discount on 1 special day of each month JUNE JULY AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER JANUARY FEBRUARY MARCH APRIL MAY Father’s Day Parents Day Independence day Teacher’s Day Gandhi Jayanti Diwali Christmas Republic Day Valentine Day Women’s Day Daughter’s Day Mother’s Day CRM of Mezcla In house Designer Gives an opportunity to customer s to make new combination and reward the best combination. Loyalty cards to the customer s who will shop for more than 6500 Rs in one bill.(10% discount) Maintain a feedback register and reward the person with the best feedback every month. This will be done to generate more genuine feedbacks. Exclusive sales of Mezcla for loyal customers. A flexible exchange policy Flowers/chocolates /cakes sent on Birthdays. Follow up calls for unavailable garments. lucky draws will be organized and passes for fusion concert , festivals & events will be given to the winner . This is a kiss and win mirror , which will be placed outside Mezcla. girls who are visiting or shopping at Mezcla are to kiss the mirror and write a word about their experience at Mezcla. 1 weekly winner will be decided by Mezcla,who gives the best word and a thank you cake will be sent to the winner’s place. Initial Investment 8 6.9446 7.2001 6 4.3186 4 2 0 Pessimistic conservative optimistic CONSERVATIVE APPROACH INITIAL INVESTMENT= FIXED ASSET+ PRE OPERATIVE EXPENSES + WORKING CAPITAL FIXED ASSET VM(EBO) VM(Warehouse) VM(Head office) Computers (hardwere+softwere) Machinery Total 98.75 L Rs (3950 sq ftx2500 Rs) 24.5L Rs (7000sq ft x350 Rs) 32 L Rs (4000sq ftx800 Rs) 16.26 L Rs 40 L Rs 2.1151 Cr Rs PRE OPERATIVE EXPENSES- 1.27 Cr Rs(12.5% of 10.17 Cr Rs) WORKING CAPITAL-- 3.5595 Cr Rs (35% of 10.17 Cr Rs) INITIAL INVESTMENT- 2.1151+ 3.5595+ 1.27 =6.9446 Cr key assumptions: First Year sale-10-50% of competitor sale Working Capital-20-50% of First year sale Pre-operative Cost-10-15% of first year sale Marketing Cost-10-15% of first year sale VM cost-2000-2500 Rs per sq ft Product costing Finishing Cost-15-20% of CMT Indirect Cost-9-12% of Direct Cost Manufacturing Cost-20-40% SCM cost-7% Freight Cost- 7% VAT-20% DepreciationOn Computer-40% On Air Conditioner- 13.91% On Furniture & Fixture-18% On Machinery-13.91% Advertisement- 8-10% of sale SCM & Logistics- 2-5% of sale Other office overhead- 2-5% of COGS Other selling overhead-2-5% of COGS Interest of bank-15% Of Debt Taxes-33.33% Income Statement- year 1 all fig in Rs PROJECTED Income STATEMENT Sales Less Cost of Goods Sold : Gross Profit pessimistic 30000000 33900000 9675286 24224714 24224714 20000000 10000000 0 -10000000 Gross profit EBIT EBT EAT -20000000 -30000000 Less -40000000 -42792414 -50000000 Office and Administration Overheads 49654485 Selling and Distribution Overheads 17362643 =Operating Profit (EBIT) -60000000 3238950 Less Preliminary Expenses ( Written Off) 1017000 pessimistic cost structure 60000000 50000000 (1/5 of Preliminary expenses) Less: Income Tax @33.33% EAT (NET PROFIT) -62729583 -70000000 -42792414 Less Interest on term loan ( 15% on Loan) EBT -47048364 49654485 40000000 -47048364 30000000 15681219 20000000 -62729583 17362643 9675286 10000000 0 Office & Administration Selling & distribution overhead overhead COGS all fig in Rs PROJECTED Income STATEMENT year 1 Sales 101700000 Less Cost of Goods Sold : Gross Profit 29138419 72561581 Conservative 80000000 72561581 70000000 60000000 50000000 Less 40000000 Office and Administration Overheads 47002222 30000000 20000000 10000000 Selling and Distribution Overheads 28371580 0 -10000000 =Operating Profit (EBIT) -2812211 Gross profit -20000000 EBIT EBT -2812211 -10560661 EAT -14080529 conservative cost structure Less Interest on term loan ( 15% on Loan) 5208450 Less Preliminary Expenses ( Written Off) 2540000 (1/5 of Preliminary expenses) EBT Less: Income Tax @33.33% EAT (NET PROFIT) -10560661 3519868 -14080529 50000000 45000000 40000000 35000000 30000000 25000000 20000000 15000000 10000000 5000000 0 47002222 Office & Administration overhead 28371580 29138410 Selling & distribution overhead COGS optimistic all fig in Rs PROJECTED Income STATEMENT 140000000 121028849 120000000 Year 1 100000000 Sales 169600000 80000000 60000000 Less Cost of Goods Sold : 40437161 48571151 40000000 121028849 20000000 31647086 21099113 Gross Profit 0 Less Gross profit Office and Administration Overheads 45788265 Selling and Distribution Overheads 34803423 EBIT EBT EAT Optimistic cost structure 60000000 =Operating Profit (EBIT) Less Interest on term loan ( 15% on Loan) Less Preliminary Expenses ( Written Off) 40437161 50000000 5400075 40000000 48571151 45788265 34803423 30000000 3390000 (1/5 of Preliminary expenses) 20000000 10000000 EBT 31647086 Less: Income Tax @33.33% 10547973 EAT (NET PROFIT) 21099113 0 Office & Administration Selling & distribution overhead overhead COGS Income statement- year2 PROJECTED Income Statement Year 2 (fig. in Rs.) Income Statement 250000000 Sales Less Cost of Goods Sold : Gross Profit 277652000 200000000 79551124 150000000 198100876 Office and Administration Overheads 89034379 Selling and Distribution Overheads 71663989 =Operating Profit (EBIT) 37402508 Less Preliminary Expenses ( Written Off) 5208450 6941300 (1/5 of Preliminary expenses) EBT Less: Income Tax @33.33% EAT (NET PROFIT) 100000000 37402508 50000000 Less Less Interest on term loan ( 15% on Loan) 198100876 25252758 8416744 16836014 25252758 16836014 0 Gross profit EBIT EBT EAT Cost Structure 100000000 90000000 80000000 70000000 60000000 50000000 40000000 30000000 20000000 10000000 0 89034379 71663989 Office & Administration overhead Selling & distribution overhead 79551124 COGS BREAKEVEN ANALYSIS OF YEAR 1 Conservative sales= 10.17cr fixed cost= PE written off Salaries 2540000 31500000 1500000 7608000 4208842 3372000 TOTAL 50728842 Rentals Electricity Salary Depreciation variable cost= cogs Other Office Overheads 29138419 9153000 3559500 10101700 2185380 2185380 TOTAL 56323379 Advertising (8 to 10% of sales) Logistics ( 2% to 5%) Sales Promotion Other SellingOverheads Contribution margin = sales – variable cost = 10.17 cr – 5.63 cr = 4.54 cr CM ratio = CM / sales * 100 = 4.54 / 10.17 * 100 = 44.64 % Breakeven point = fixed cost / CM ratio Breakeven sales = 50728842/ 44.64 *100 = 113639879 MOS = sales at selected activity – sales at BEP = 10.17 cr – 11.36 cr = 1.19 cr (negative) Pessimistic Sales- 3.39 cr Total fixed cost =49205842 Total variable cost = 28503572 Contribution margin =3.39cr2.85cr CM ratio = 15.92 % Break even sales = 309081922 MOS = 27.51cr(negative Optimistic Sales-16.96 cr Total fixed cost = 51578842 Total variable cost = 80973997 Contribution margin = 16.96 cr8.09 cr CM ratio = 52.3 % Break even sales = 98621112 MOS = 7.1 cr Margin of Safety- YEAR 1 100000000 Break even graph 50000000 0 Pessimistic -50000000 Conservative Optimistic -11900000 -1E+08 x 10000000 71000000 120 100 80 60 -1.5E+08 40 -2E+08 20 -2.5E+08 0 -3E+08 Year1 -275100000 Year2 Year3 Actual sale figure in Cr Sales forecast for year 1 20 Year4 Break even Sale 5 years sales forecast Series1 16.96 15 1031964743 796095465 10.17 10 5 Year5 558977528 277652000 3.39 101700000 year 1 0 Pessimistic Conservative Optimistic year 2 year 3 year 4 year 5 Ratio OPM ratio GPM 80.00% 71.35% 71.35% 71.35% 25.00% 71.35% 71.35% 70.00% 22.29% 19.29% 20.00% 16.87% 13.47% 15.00% 60.00% 50.00% 10.00% 40.00% 5.00% 30.00% 20.00% 0.00% 10.00% -5.00% 0.00% year1 year2 year3 year4 year1 -2.77% year2 year3 year5 NPM 15.00% 12.56% 8.43% 10.00% 10.39% 6.06% 5.00% 0.00% year1 -5.00% -10.00% -15.00% -20.00% -13.85% year2 year3 year4 year5 year4 year5 1st year- 3 scenarios Pessimistic Conservative Ratio 80.00% 100.00% 71.35% 71.46% 50.00% 60.00% 0.00% 40.00% -50.00% 20.00% -100.00% NPM ratio -150.00% 0.00% -20.00% GPM ratio GPM ratio NPM ratio -13.85% OPM ratio -2.77% ROA ratio -13.30% ROE ratio OPM ratio -40.55% -60.00% -200.00% -185.04% -202.31% -300.00% -290.51% -350.00% Optimistic Ratio 250.00% 191.18% 200.00% 150.00% 100.00% 71.36% 58.61% 50.00% 12.45% 23.84% 0.00% GPM ratio IT ratio NPM ratio COGS/Inventory OPM ratio COGS Inventory ROE ratio -126.23% -250.00% -40.00% ROA ratio ROA ratio ROE ratio 42199 11120 3.79 References