BUSINESS PLAN_A GENERAL OVERVIEW

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All rights reserved. No parts of this publication maybe reproduced, stored in retrieval
system, or transmitted in any way or by any means, electronic, mechanical,
photocopying, recording, or otherwise without prior written permission from KOLEJ
KOMUNITI BERA.
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KOLEJ KOMUNITI BERA
Ministry of Higher Education
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Taman Bera Jaya
28300 Triang
Pahang Darul Makmur
Tel : 09 – 250 2530 Faks : 09 – 2502531
Email : admin@kkbera.edu.my
WRITER & EDITOR:
Keadsrar Phongswat a/p Eteng
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.
PREFACE
A business will never complete without a proper plan. To start a business, a potential entrepreneur
should know the whole plan to run a business. That’s why they need to have a business plan. A
business plan can help the entrepreneur in different purposes. Either for applying loan or business
future analyzing, it is the essential part for potential entrepreneur to understand.
This simple book aims to give a general overview on business plan. It can be a reference for students
to plan their start-up business. At the end of the book, students are able to understand what is a
business plan and the purpose of business plan.
The writer hope this simple book can help the students and educators to get an overview on business
plan and it can be used for their future business.
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TABLE OF CONTENT
No Item Page
Preface
Table of content
I
II
Introduction 1
1.0 Why do we need the business plan 2
2.0 What is a business plan 2
3.0 Who need the business plan 3
4.0 Developing a business plan 6
5.0 The importance of a business plan 7
6.0 Standard format of a business plan 8
7.0 Executive summary 9
8.0 Table of contents of a standard business plan 10
9.0 Introduction 11
10.0 Purposes of preparing a business plan 11
11.0 Company background 12
12.0 Owners background 12
13.0 Background of proposed project 13
14.0 Administration plan 14
15.0 Marketing plan 17
16.0 Operational plan 20
17.0 Financial plan 23
18.0 Conclusion 26
19.0 Appendices 26
Summary 27
Glossary 28
References 29
Sample of business plan 30-58
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INTRODUCTION
A business plan is a formal statement of a set of business goals, the reasons they are believed
attainable, and the plan for reaching those goals. It may also contain background information
about the organization or team attempting to reach those goals.
A good business plan must be able to communicate the business ideas & goals. A good
business plan must be able to help the business to expand in the future
In its simplest form, a business plan is a guide a roadmap for your business that outlines goals
and details how you plan to achieve those goals in a certain period of time.
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1.0 WHY DO WE NEED A BUSINESS PLAN?
You have probably discovered a new idea in business & you’re maybe can’t wait to start a
business. There’s so much to learn and gather that is can become quite interesting. But, have
you assessed whether you are an entrepreneur at heart and ready for any challenges? Do
you know what kind of business you’re interested in? The next step will test you.
A business plan is a necessary tool for all businesses. Imagine that you’re trying to build a
home without a blueprints or a movie without a script, don’t start a business without any
blueprint. Take all the information gathered and put all those ideas onto paper. Never keep
the ideas in your brain.
Without a business plan, banks or investors
will not entertain the thought of financing
your business. It is your only foot in the door,
so make sure it shines.
2.0 WHAT IS A BUSINESS PLAN?
A business plan is a written document that describes a business:
Objectives
Strategies
Market and;
Financial forecasts.
It has many functions, from securing external funding to measuring success within your
business.
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3.0 WHO NEED THE BUSINESS PLAN?
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There are few parties who need the business for few reasons. Business plan is very important
as it give important info for the parties.
a) Entrepreneur
Able to analyze the strengths and weaknesses of the company as well as threats &
opportunities that would be faced in future
Act as a guide of the business from setting business objective to establish daily
priorities
b) Shareholders
They need business plan to critically view the draft plan
They review the business plan to make decision whether to become the shareholder
of the company or not
c) Bankers/Creditors/Financial institutions
Business plan is needed when applying for a business loan
Most bankers need the business plan to review whether the entrepreneur qualified
for the loan or not
d) Investors
The business plan should explains the reason why the investors should invest in the
business and how the capital provided will be used by the entrepreneur
When a business plan is prepared accordingly to information given, the investors will
gain confidence in the company
e) Management/Employees
To communicate with the management team
The management will come up with strategies and objectives for the business
f) Clients/Customer
To convince the organization’s clients of the business ability and capability to fulfill
the job contract
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Customers will also be interested in the business plan to look for information about
the company which influence their decision to purchase the company producrs or
services
g) Supplier
Convince the supplier of the viability of the venture
The business credit given today can be transformed into a long term business
arrangement benefit both supplier and business
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4.0 DEVELOPING A BUSINESS PLAN
Steps to be followed while preparing a Business
Plan:
Write out what you want to do or what type
of business it is to be.
Write out your purpose in starting this
business.
Write out your vision for the business:
‣ Short Term (0 - 3years)
‣ Medium Term (3 - 5years)
‣ Long Term (more than 5 years).
Write down a list of what resources you
know you need to start your business: e.g. an office, a bank loan etc.
Clearly state any uncertainties you may have, for example, you may be uncertain about the
type of business structure to create - a company or a close corporation etc.
Identify your market.
Identify your competitors.
Attach a cost to each item in (4) and develop your fixed and your start-up costs.
Work out how many months your business may have to survive before its income equals the
expenditure
Give careful thought about how you will make your business known - how you will market
your products or services - and calculate the costs associated with this marketing.
By knowing why, you are preparing this plan, you
can save time and effort by focusing on the
important areas.
Business plans often contain filler information that
is not pertinent. If you need to borrow funds, ask the
lending institution exactly what is required.
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5.0 THE IMPORTANCE OF BUSINESS PLAN
Business Plan set few important aspects. The importance of business plan set as follows:
Creates the opportunities for
success
Set the business mission
Determines the right way of
managing the business
Increases the stakeholders’
confidence
Determines barriers to the venture
Determines the company’s performance
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6.0 STANDARD FORMAT FOR A BUSINESS PLAN
When you’re planning to write a business plan, you should know what are the contents of a
standard business plan which usually contains all these in information.
Cover Letter
Cover Page/Title Page
Executive Summary/Abstract
Table of Contents
Introduction
Purpose
Company Background
Owners Background
Location of Business
Organization/Administration Plan
Marketing Plan
Operational Plan
Financial Plan
Conclusion/Summary and Recommendation
Appendices
This is your chance to make a good first impression.
The cover letter will be the first thing the bank sees as
they consider whether or not to invest in your
business. Make a good impression.
Keep the cover letter short-1 or 2 pages
Address it to a specific person, if possible
Use the proper format
Be clear about why your practice would be a
good investment for the bank
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Submission date
Company mission
Cover Page create the first impression and
favorable image that reflects the nature of the
business. Cover page contains:
Title of business plan
Logo
Name & address of business
Name of writer/s
7.0 EXECUTIVE SUMMARY
The executive summary is what most readers will go to first. If it is not good, it may be the last
thing they read about your company. Lenders in particular read executive summary before looking
at the rest of a plan to determine whether or not they want to learn more about a business. Other
readers will also go first to your executive summary to get a snapshot of your business and to
gauge your professionalism and the viability of your business.
While your executive summary is the first part of your plan, write it last. As you create the other
sections of your plan, designate sentences or sections for inclusion in your summary. Your
executive summary should be one page only and include these:
Business concept
Financial features
Financial requirements
Current state of your business
When it was formed
Principal owners and key personnel, and major achievements
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8.0 TABLE OF CONTENTS FOR A STANDARD BUSINESS PLAN
Table below shows a standard format of a business plan. You can organize your content of your
business according to the example shown below:
No Item Page
1. Introduction
2. Purposes of preparing business plan
3. Company background
4. Owners background
5. Background of proposed project
6. Organization plan
7. Marketing plan
8. Operational plan
9. Financial plan
10. Conclusion
11. Appendices
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9.0 INTRODUCTION
This part introduced the proposed business venture which contains these information:
Name of the company
Nature of business
Industry profile
Business location
Date of business commencement
Justification of planned project
Factors in selecting proposed business
Future prospect of selected business
When explaining this part, explain it simple & clear. Make sure that the bankers understand
what you’re trying to explain.
10.0 PURPOSES OF PREPARING BUSINESS PLAN
The entrepreneur should clearly state the purpose of preparing the particular business plan.
Normally, entrepreneur will state these reasons in their business plan.
To apply financing facilities
To act as the guideline in managing the business
To allocate the business resources effectively
To analyze and evaluate the project viability and growth potential
The main purpose of preparing business plan not necessary to apply financing facilities from
financing institution. Business plan can also be your business mapping for the certain period of
time.
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11.0 COMPANY BACKGROUND
The entrepreneur should give details on company background. Make it in point form. Details in
company background are as follows:
Name of the business
Address of business
Telephone/fax no/e-mail
Form of business
Main activity
Date of commencement
Date of registration & registration no
Initial capital
Name of bank & account no
12.0 OWNERS BACKGROUND
This part focuses on two aspects, which are (1) the personal details of owners or partners & (2)
the partnership agreement. Details in owners’ background are as follows:
Name of the owner/partners
Identity card number
Permanent address
Correspondent address (includes website/email address)
Telephone number
Date of birth
Age
Marital status
Academic qualification
Course attended
Skills
Present occupation
Experience
1
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Name of the business
Form of business
Location of Business
Equity Contribution
Financial Matters
Management & Position
Death & Dissolvement
Labour rights
Other matters
Signature of shareholders
2
13.0 BACKGROUND OF PROPOSED PROJECT
This part will focus on the details of chosen location. Explain this section in short paragraph.
Physical location
Price of premise
Distance from the source of raw materials
Availability of manpower
Transportation facilities
Distance from customers
Basic amenities (Electric, water, & telephone facilities)
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This part explains how the
business will be managing in order
the objective of the business can
be achieve. It is a plan that describe the contribution of management
team and staff to the bottom line, setup plans, and strategies of
business. Basically, this info’s is included in the plan:
‣ Mission, vision, & objectives
‣ Organizational chart/structure
‣ Manpower planning
‣ Schedule of tasks & responsibilities
‣ Remuneration plan
‣ List of office equipment & supplies
‣ Administrative budget
MISSION, VISION, & OBJECTIVES
MISSION
‣ A mission statement defines the long-term goals
‣ business's mission statement is more permanent than an objective in a business plan. It
must be applied consistently over time. The mission statement serves as a reminder -- to
you, your employees, and your customers -- of the main purpose of your business
VISION
‣ Vision statement is about what the business's future will look like if the mission is achieved.
Some say a vision statement imagines what success looks like
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OBJECTIVES
‣ Spell out your goals; specify results and activities that can be easily tracked
‣ Objectives don't have to be financial. You can set objectives for performance, customer
satisfaction, and other key elements of success, as long as you define how they will be
measured
ORGANIZATIONAL CHART/STRUCTURE
A diagram that shows the structure of an organization and the relationships and relative ranks of
its parts and positions/jobs. The term is also used for similar diagrams, for example ones
showing the different elements of a field of knowledge or a group of languages.
Example of organizational chart
MANPOWER PLANNING
State the manpower will be used in business. Explain the number of manpower needed in your
business. State the position together with total number of staff needed
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SCHEDULE OF TASKS & RESPONSIBILITIES
State the responsibilities for each position in your organization. Example, for the account clerk
position, state the responsibilities for the position
REMUNERATION PLAN
State the remuneration for all the position in your organization. State the salary, number of
worker, & deduction (EPF & SOCSO)
LIST OF OFFICE EQUIPMENT & SUPPLIES
You need to list the office equipment needed in your administration plan. For example: you might
need a photostat machine, state the quantity for the photostat machine, price, & total price
ADMINISTRATIVE BUDGET
List the administrative budget. For example, fixed asset, stationeries, or any other expenses that
related to administrative need to be taken into account. Never forget to list all the expenses as it
will affect the financial part.
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The activities that are carried out
systematically in an organized manner. It
is a way to attract customers to buy the
company product/services. It is a critical
activity since it provides the opportunity
for the business to develop and grow
through the exchange between business
entity & the customer
‣ Description of products or services
‣ Target market & market segmentation
‣ Market size
‣ SWOT analysis
‣ Market share
‣ Sales forecast
‣ Marketing strategy
DESCRIPTION OF PRODUCTS OR SERVICES
Describe the proposed product or services offered by you
Explain the product features, benefits, and overview of processes or technology to
create the product or services
Describe the product differentiation compared to the competitors product
TARGET MARKET & MARKET SEGMENTATION
A target market is a group of customers towards which a business has decided to aim its
marketing efforts and ultimately its product or service.
Market segmentation is the process of dividing a market into categories of consumer types
of variables
Geographic variables – country or region
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Demographic variables – age, occupation, gender, education level, social class of
income, family, race
MARKET SIZE
The number of individuals in a certain market who are potential buyers and/or sellers of a
product or service.
Entrepreneur is interested in knowing the market size before launching a new product or
service in an area.
Normally quoted in unit of goods or sales (RM)
SWOT ANALYSIS
S.W.O.T. is an acronym that stands for Strengths, Weaknesses, Opportunities, and
Threats.
A SWOT analysis is an organized list of your business’s strengths, weaknesses,
opportunities, and threats.
List the SWOT factors for your business.
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MARKET SHARE
Refer to the portion of how much of the market that the business can capture or control
after you recognize the market size and the competitor’s position
SALES FORECAST
Sales forecasts are estimates of your sales for the forecast period.
Ask yourself how much can you realistically sell next year, and how much will you charge
for your goods or services?
If you are starting a new business and don't have a business history, base your sales
estimates on market research, industry information, business strategies and objectives.
Your future sales will be based on sales forecast. but remember, sales forecast is an
estimation only
MARKETING STRATEGY
An organization's strategy that combines all of its marketing goals into one comprehensive
plan.
A good marketing strategy should be drawn from market research and focus on the right
product mix in order to achieve the maximum profit potential and sustain the business.
The marketing strategy is the foundation of a marketing plan.
Marketing strategies consist of four key variables or also known as 4Ps of marketing mix:
Product, Price, Place, & Promotion.
State the marketing strategy that will be used in your business whether you want to use
the product strategy, price strategy, place strategy, or promotion strategy
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A description of a business physical
location, facilities & equipment,
inventory requirements, & suppliers
It also includes operational details
such as description of the
manufacturing process. It is a
systematic direction and control of
the processes that transform resources into finished goods and
services that create value and benefit to customer
‣ Operational process
‣ Process flow chart
‣ Production schedule
‣ Material requirement
‣ Machine & equipment
‣ Location of operation
‣ Operation layout plan
‣ Operation cost & cost per unit
‣ Operational budget
OPERATIONAL PROCESS
Depicted in the form of flow chart
State the key steps in the operation process for your product or even services
Present the operations process flow in a chart
PROCESS FLOW CHART
State the key steps in the operational process in producing the products or services of the
business
Among the activities in the process flow chart are operation, transportation, inspection,
delay, & storage
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PRODUCTION SCHEDULE
The amount of product that a company can produce
The production schedule specifies the operation output in units of product or hours of
operation
MATERIAL REQUIREMENT
List the raw materials or inventory needed in the operational process
include the quantity required, price, and suppliers
The list also comprises the mode of payment which will be used to purchase the raw
material and the ending stock that can be estimated as a portion of the monthly or yearly
purchase
MACHINE AND EQUIPMENT
List all the machines & equipment used in production
List together with the estimated price, number of units, & suppliers name
LOCATION OF OPERATION
Specify the site of your business operation
Location should be near to raw materials and market, easy to get the staff, near to basic
amenities, & transportation.
OPERATION LAYOUT PLAN
Draw the floor plan of the operational space
Can be in the form of process layout, product layout or marketing layout
Operational layout plan should show the logical arrangement of the physical facilities of
the business
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OPERATION COST & COST PER UNIT
Calculate the total operational cost
Divide by the number or unit or output produced
Operational cost is a sum of total costs of direct and indirect material, direct & indirect
labour, & overhead
OPERATIONAL BUDGET
The operational budgets consist of all operational expenses
Consists of all operational expenses under the following categories
Capital expenditure/Fixed asset expenses (Long term fixed asset for production.
Eg: Machinery)
Working capital/ Monthly expenses (Payment that has to be made every month.
Eg: direct material course, direct labour cost, & overhead)
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A description of how the business will be
finance and how it will maintain a sound
financial position. It gives overall picture of the
total cost that is needed to run the entire
business venture. The financial plan is
prepared after all budgets pertaining to
marketing, operation, and administration are
completed. The crucial aspects of financial
plan are the total project cost, sources of
financing and preparation of pro forma statement.
‣ Project implementation cost schedule
‣ Source of finance schedule
‣ Hire purchase
‣ Loan amortization (Repayment)
‣ Fixed asset depreciation
‣ Pro forma cash flow statement
‣ Pro forma income statement/profit & loss
‣ Pro forma balance sheet
PROJECT IMPLEMENTATION SCHEDULE
The initial amount of investment that needed to start a new business
Summarizes the cost of buying fixed assets, working capital requirements, as well as
expenditures
Covers short term expenditure and short term expenditure
‣ Capital expenditure - Land, building, machinery, transportation, furniture, fixtures
& fitting
‣ Working capital – Part of operating capital. Cover expenses in administrative,
marketing, & operational
‣ Other expenses – Other costs appear for implementing the proposed venture (Eg:
business registration fee, road tax, stamp duties, training fees, & business licence)
‣ Contingency allowance – Additional funds set aside for items that maybe needed
during the implantation of the project. Allocate at least 5% for the contingency
allowances
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SOURCES OF FINANCE SCHEDULE
Refer to sources of fund obtained to finance your proposed project
Can be categorized into internal sources & external sources
‣ Internal sources - personal fund, family & friends, retirement account
‣ External sources – Bank & other financial institutions, government loan, stock
market
HIRE PURCHASE
Form of financing used in the purchase of fixed asset
Example: To finance transportation vehicles, business premises, machinery & equipment
Listed in Hire Purchase Act
The total repayment will depend on the amount of loan, interest rate, & loan duration
LOAN AMORTIZATION (REPAYMENT)
A loan with a fixed rate basis is amortized when both principal and interest are paid by a
sequence of equal payments made over equal time intervals
Annual principal payment is derived by dividing the loan amount with the period of
financing
Example: Assuming that the period of term loan is five years and the total amount is
RM50,000.00. The annual payment of principal for term loan is RM10,000.00 (RM50,000/5
years)
FIXED ASSET DEPRECIATION
A reduction in the value of fixed assets to reflect deterioration in the asset over time
It is a non-cash expenses. It depreciation lower the company earning and increasing free
cash flow
Specific accounting rules are used to measure the depreciation
Except land, this schedule is used to measure the depreciation of fixed asset
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items needed to be depreciated are the cost, method used, economic life in years, annual
depreciation, accumulated depreciation, and book value
PRO FORMA FORECASTED CASH FLOW STATEMENT
Projected statement of a company cash inflow and outflow throughout the planned period
Predict the rate at which money will flow in and out in the business
Measure the business’s liability & its ability to pay its bills & other financial obligation
Begins with the existing cash balance for the business
‣ Cash inflow – owners capital in cash, loan, cash sales, collection of account
receivables, sales of assets & etc
‣ Cash outflow – administrative expenditure, account payable, inventory
‣ Cash deficit – difference between cash inflows and cash outflows
‣ Cash position – the beginning and ending cash balances for a particular period.
The final component in the pro forma cash flow statements is the cash position
PROFORMA FORECASTED INCOME STATEMENT
Shows the financial performance expected profit & loss of the business
Usually show in three consecutive years
Compare expenses against revenues for a certain period of time to indicate profit & losses
Prepare for the first, second, and third of the business for the manufacturing, trading, and
service-based business
PRO FORMA BALANCE SHEET
Prepare to show how the business asset is acquired and the sources used to finance
these assets
Is a financial statement that disclosed business assets, liabilities, & owner’s equity
Bank require the account prepares for the first, second, & third year of the business
The owner of the business should recognize which item to be categorized as fixed assets,
current assets, current liabilities, & long term liabilities
‣ Fixed asset – Equipment, machinery, furniture, fixtures & fittings, vehicles,
building, plants, & etc
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‣ Current asset – Cash, account receivables, inventories, & stock
‣ Current liabilities – Account payable, Accrued payments
‣ Long term liabilities – long term loans, bond issues
‣ Owner’s equity – Investment made by the owner through original capital
contribution in term of cash or asset plus the accumulated amount of net profit
18.0 CONCLUSION
Concludes & justified the purposes of preparing the business plan
It also highlights the viability & potential of the proposed project
19.0 APPENDICES
All relevant document that support the business plan
‣ Supported document from financial institutions
‣ Copies of courses certificates attended
‣ Offer letter for tender
‣ Permit
‣ Licence
‣ Promotional brochures or advertisement
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SUMMARY
A business plan is a guide to a roadmap for the business that outlines goals and details on how
an entrepreneur plan to achieve goals in a certain period of time. Business plan contains all
financial information in the administrative, operational, & marketing plans that combined together
into an account that will determine the cost of business.
A business plan guided an entrepreneur on how to utilize the capital effectively. Too many
people think that business plans is something that an entrepreneur has do to apply loan or find
investor. They are vital for those purposes, but there’s a lot more to it. An entrepreneur should be
smart on planning a good business plan and allocate the cost wisely.
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GLOSSARY
Business plan – Rancangan perniagaan
Blueprint – Rangka tindakan
Cash deficit – Defisit tunai
Cash inflow – Aliran tunai masuk
Cash outflow – Aliran tunai keluar
Current asset – Aset semasa
Current liabilities – Liabiliti semasa
Dissolvement - Pembubaran
Executive summary – Ringkasan eksekutif
Equity contribution – Sumbangan ekuiti (modal)
Fixed asset – Aset tetap
Hire Purchase Act – Akta Sewa Beli
Market segmentation – Segmentasi pasaran
Owners’ equity – Ekuiti pemilik
SWOT Analysis – Analisis SWOT
Working capital – Modal kerja
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BIBLIOGRAPHY/REFERENCES:
What Is A Business Plan. Retrieved July 31, 2014 from
http://www.smallbizpro.com/Chapter7Businessplans.pdf
What Is A Business Plan? Retrieved July 31, 2014 from http://www.dineshbakshi.com/igcsebusiness-studies/business-activity/revision-notes/1546-writing-a-business-plan
Creating An Effective Business Plan. Retrieved August 1, 2014 from
http://malaysia.smetoolkit.org/malaysia/en/content/en/793/Creating-an-Effective-Business-Plan
Plan Your Plan Retrieved August 1, 2014 from http://www.entrepreneur.com/article/38292
Business Plan Basics: Vision Statements, Mission Statements, and Objectives. Retrieved August
18, 2014 from https://smallbusiness.yahoo.com/advisor/business-plan-basics-vision-statements-
080000612.html
Sarimah Hanim Aman Shah & Abdul Rahid Mohd Ali (2010), Entrepreneurship(2 nd ed), Shah
Alam: Oxford Fajar Sdn. Bhd.
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SAMPLE OF
BUSINESS PLAN
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BUSINESS PLAN
THE MEMORIES BRACELET ENTERPRISE
59, Regat Sri Cempaka,
Taman Cempaka,
31400 Ipoh, Perak.
10 October 2014
To become a market leader in the production and
distribution of finest bracelets around Malaysia within 7
years.
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EXECUTIVE SUMMARY
The Memories Bracelet Ent. provides quality handicraft services. The main objectives are to
instill moral value of Malaysia craft and produce creative product from Malaysia. There has
been a need for handicraft services in Taman Cempaka area for a long time, which prompted
us to develop this business. The company also plans to offer quality handicraft services at a
competitive price.
Our company will be located in a housing area in Taman Cempaka. Our business will
serve the students, corporate sector, families and teenagers. Currently, there is little
competition in the same category such as The Memories Bracelet in this area. We plan to
take full advantage of our business location by reaching out to the current resident in the area.
The Memories Bracelet will operate seven days a week under experienced management,
headed by our Director, Muhammad Fahmi Bin Mohd Rofi’ai. The company will have two
experienced designers to perform art and design tasks. We also plan to hire a Human
Resource Manager in future.
This document will demonstrate the need for a business such as this in Taman Cempaka
and its chance as for success. It will serve as a road map that will set the cost for further
planning and for the implementation process. Anticipated financing is RM50,000 for the total
start-up cost of RM50,000. This financing will help ensure a timely start to the business in
order to take advantage of the new school semester. Repayment of financing will be through
cash flow of the business on a scheduled basis.
Anticipated sales are RM167,000 for the first year, RM192,050 for the second year and
RM220,858 for the third year. This is based on the objectives to get reasonable profit and to
ensure customers continue doing business with using the future. Emphasis will be placed on
friendly services that will not only meet but exceed customer’s expectation.
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1.0 INTRODUCTION
i. Name of Company
The Memories Bracelet
ii.
iii.
iv.
Nature of business
Souvenir
Industry profile
Bracelet is a business that creates new designs for customers according to the
customer’s demand and their own choice design. This bracelet will be one of
the precious memories of the customer either for themselves or their loved
ones. Besides that, not many people have the knowledge & skills of making
bracelet designs.
Location of Business
59, Regat Sri Cempaka, Taman Cempaka, 31400 Ipoh, Perak.
v. Date of business commencement
07 October 2014
vi.
vii.
Factors in selecting the proposed business
To fulfill unlimited customers demand about these products.
To ensure the products can be competing intensely with others companies in
a same target market and to make our idea become reality.
Future prospects of the business
Once the business is financially stable. We plan to open other branches and
expand our business in other states around Malaysia. Besides that, we would
also like to improve and upgrade the quality of our services and hire more
workers in our business. In addition, I would like to do training classes for those
who would love to learn how to do bracelets. As a conclusion, this business
has a good future prospect by fulfilling the needs of our customers.
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2.0 PURPOSE
i. To apply financing facilities from relevant institutions
ii. To act as a guideline in managing the business
iii. To allocate business resources effectively
iv. To analyses and evaluate the project viability and growth potential
v. To allow the entrepreneur to view and evaluate the proposed business venture in an
objective, critical and practical manner
3.0 COMPANY BACKGROUND
Name of Business
Business Address
Website
: The Memories Bracelet
: 59, Regat Sri Cempaka, Taman Cempaka, 31400 Ipoh, Perak.
: www.thememoriesbracelet.com.my
Office Number : 017 8898680
Form of business
Main Activities
: Art & design
: Bracelet
Date of
Commencement : 07 October 2014
Date of registration : 02 September 2014
Registration number : CA2838408-W
Initial capital : RM100, 000
Name of bank
: CIMB
Account bank : 180294020994
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4.0 OWNERS BACKGROUND
Owner 1:
Name
Muhammad Fahmi bin Mohd Rofi’ai
Identity Card number 780218-07-5591
Age
36 years
Gender
Male
Permanent Address
4800 Mk20 Kubang Semang
14400 Bukit Mertajam
P. Pinang
Correspondence address No 14, Persiaran Cempaka Sari 5
Taman Cempaka
31400 Ipoh
Perak
Telephone number 017-8898680
Marital status
Academic qualification
Skills
Married
-Master in marketing
-Degree in business administration
-Diploma in accounting
-Expert in marketing
-Have many friends and link with great
people
-Fluently in English and Malay speaking
Experiences
-Join venture with another SME
company
-Manager in pizza hut
-Open a small business
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Owner 2:
Name
Surjit Kaur A/P Manjit Singh
Identity Card Number 850302 – 08 – 6318
Age
Gender
Permanent Address
29 years
Female
No.110, Persiaran Rishah, Taman
Silibin Ria, 30100 Ipoh, Perak
Correspondence address
No.110, Persiaran Rishah, Taman
Silibin Ria, 30100 Ipoh, Perak
Telephone number 014–6015466
Marital status
Academic qualification
Skills
Experiences
Married
Degree in Marketing
-Good and art and design
-Good in communicate with customer
-Working at art studio for 2 years’
experience
-Manager at studio art Shah Alam
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Owner 3:
Name
Chow Qian Yi
Identity Card Number 880825-02-5158
Age
26 years
Gender
Female
Permanent address No.18,Jalan Jerai 8,
Taman Selasa Off Bee Bee Park,
05400 Alor Setar,
Kedah Darul Aman.
Correspondence address No.133,Persiaran Cempaka 5,
Taman Cempaka,
31400 Ipoh,
Perak Darul Ridzuan.
Telephone number 017-474 1388
Marital status
Academic qualification
Skills
Experiences
Single
Bachelor’s Degree In Business
Administration
Excellent Computer Skills And
Proficient In Excel, Word, Outlook, And
Access
Excellent Communication Skills Both
Verbal And Written
3 Plus Years’ Experience In
Bookkeeping
3 Years’ Experience As Head
Department Of Operation In Xyz Sdn
Bhd
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Owner 4:
Name
Raja Aisyah Binti Raja Jusoh
Identity Card Number 890811-03-5590
Age
25 years
Gender
Female
Permanent address
Lot 713, Padang Seri Paduka Kubang
Kerian 16150, Kota Bharu, Kelantan
Correspondence address
Lot 713, Padang Seri Paduka Kubang
Kerian 16150, Kota Bharu, Kelantan
Telephone number 011-19776397
Marital status
Single
Academic qualification
Degree In Fashion Designer
Skills
Can Design Variety Bracelet, Can
Design Based On Customer Need
Experiences
Get Award From Prime Minister For
The Best Designer Of Bracelet
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5.0 BACKGROUND OF THE PROPOSED PROJECT
i. Business Location
The Memories Bracelet Sdn Bhd is located at No.59, Regat Sri Cempaka, Taman Cempaka,
31400 Ipoh, Perak. Generally, the premise is a shophouse situated in a housing area with
many facilities nearby.
ii.
Type and Price of building
The premise is a commercial business premise. Expenses for the rent cost about RM750
per month.
iii.
Basic amenities (electrical, water and telephone facilities)
Our office is completed with water, electricity supplies and telephone lines. These basic
amenities are provided for all workers to perform and accomplish their jobs more efficiently
and productively.
iv.
Distance from the source of raw materials
We get the raw materials from supplies around Ipoh area. Our supplies are Creative which is
located at Meru, Ipoh and Ready which is located at the Ipoh town. The supplies always
guarantee that the materials are not faulty.
v. Availability of manpower
Since this business requires skilled workers, the search for available manpower need to be
expanded to other areas. We plan to maintain the number of workers in the first year and
search for more staff around Ipoh for the coming years.
vi. Transportation facilities
Customers can reach our premise by bus and taxi. The location is also convenient for our
supplier to deliver the raw materials.
vii. Distance from customer
Our company is located 500 meters from the nearest schools, polytechnic and housing area
which makes its very convenient for our customers.
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6.0 ORGANIZATION PLAN
MISSION
To become a market leader in the production and distribution of finest bracelets around
Malaysia within 7 years.
VISION
To become a reputable bracelet trader in the region.
OBJECTIVES
To instils moral value of Malaysia craft and produce creative Product from
Malaysia
To offer reasonable price
Price is very important. The price must be reasonable with the quality of
product must be parallel to make customer continue using our
product and achieve target to make a loyal customer.
Ensure the order complete by the due date
To make sure the product that people order make it in time and
customer don’t need to wait for the product o bare the risk of losing
customer.
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6.1 Organization Chart
MANAGER
Muhammad Fahmi
bin Mohd Rofi’ai
FINANCE
MARKETING
OPERATION
DESIGN
Nor Amirah binti
Abdul Halim
Surjit Kaur A/P
Manjit Singh
Chow Qian Yi
Raja Aisyah binti
Raja Jusoh
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6.2 Main Power Planning
Position and number of personnel
Position
Number of Personnel
Manager 1
Finance 1
Marketing 1
Operation 1
Designer 1
6.3 Job Specification
Task
Responsibilities
Manager
key actor in the agency's organizational structure
Taking all the necessary actions to ensure the agency's
operation.
Managing all staff related matters .
Preparing and implementing the decisions, strategies,
programmes and activities .
effective monitoring system to enable evaluations to
compare the agency's achievements with its operational
objectives .
Ensuring the cooperation with different institutions and
stakeholders.
Finance
Manage a Budget for promotion , purchase assets and
capital .
Prepare Income statement and Balance sheets at the end
of the year
Marketing
Set the Strategy, Plan the Attack, and Execute.
Promotion to make people knew the existing of The
Memories Bracelet Sdn Bhd and prepare marketing budget
Company opening to make sure people know about The
Memories Bracelet company .
Operation manage transaction using banking online .
Take order from customer and explain terms and condition
of buying online / customer design request .
Give order to designer to work on customer design .
Conduct delivery product .
Design Focus on customer needs and wants .
Create new creative ideas .
Draw and design .
Complete customer request before the due date .
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6.4 Schedule of remuneration
Position
Salary (RM)
Financial 1200.00
Marketing 1200.00
Operation 1200.00
Design 1200.00
Total 4800.00
6.5 Salary
Basic wage , salary , bonus and overtime will be paid by cheque .The wages and salary will be
paid once a month to the workers and the payment will distribute at the end of month . Any
increment in wages and bonus will be decided by Director based on their qualification and working
experiences .
6.6 List office equipment and supplies
NO TYPES QUANTITY PRICE PER UNIT
(RM)
TOTAL AMOUNT
(RM)
1 Furniture 3 3,000.00 9,000.00
2 Stationary - 350.00 350.00
3 Computer 4 1,000.00 4,000.00
4 Fire extinguisher 1 400.00 400.00
5 Broom 1 10.00 10.00
6 Dustbin 1 5.00 5.00
7 Air conditioner 2 500.00 1,000.00
8 Telephone & Fax 1 1,500.00 1,500.00
9 Printer 1 1,200.00 1,200.00
TOTAL 17,465.00
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6.7 Administrative Budget Estimation
NO PARTICULARS ASSET
EXPENSES
(RM)
MONTHLY
EXPENSES
(RM)
OTHERS
(RM)
1 Premis Rental 750.00
2 Premis deposit 1,500.00
3 Office Equipment 17,465.00
4 Salaries 4,800.00
5 Utilities 200.00
6 Company SSM 350.00
7 Utilities deposit 2,000.00
TOTAL 17,465.00 5,750.00 3,850.00
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7.0 MARKETING PLAN
7.1 Market Analysis
Malaysia boasts a rich legacy in the art and crafts, clearly highlighting Malaysian
craftsmanship. Therefore, it comes as no surprise that the Malaysian Handicraft Development
Corporation has been working hard to preserve and enhance the nation s handicrafts industry.
To attain this vision, sustainable planning and approach are needed to ensure the craft industry
keeps contributing to the national economy and provide an income for those in the industry.
Therefore, it comes as no surprise that this handmade craft industry has been chosen as our
business.
We supply quality product and are concern with customer satisfaction. Our
business was developed to fulfil the demand of the craft industry. We include delivery services
for our customers convenience.
We guarantee that our product are of good quality. If our product have failed to
satisfy and fulfil our customer’s needs. We guarantee a full refund of the value of purchase or
a replacement of the same value.
7.2 Target Market
The Memories Bracelet’s is a new company that is situated in an industrial area which is also
near to housing development. The main nature of this company is to supply craft products to
our customers. From a survey that was conducted at Taman Cempaka has identified its target
market: students, corporate sector, kids and adults, art and design collector and youth who
need our products as handicraft products around Taman Cempaka. Based on the survey
results we believe that The Memories Bracelet’s will be able to stabilize itself by focusing on
this target market.
7.3 Pricing
Particular Unit(RM) Quantity Total RM)
Bracelet
Fanx suede (cord) 4.00 50 200.00
Charm-60 design 4.00 100 400.00
Alphabate-(A-Z) 2.30 100 230.00
Crimp end-
6.90 20 138.00
8mm,16mm,20mm,25mm
Jump ring 3.00 20 60.00
Tools-pliers, scissors, clasp knife 50.00 50.00
TOTAL 1,078.00
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7.4 Swot Analysis for Competitors
Competitors Strength Weakness
MIR Craft’s Fully managed by
experts.
Located in Station
18 which customer
Located at an
industrial area in
Ipoh.
at Meru find in
convenience in
frequent
Have good facility
and a huge shop.
ELMO Craft’s Large sales
volume every year
Office situated in
Taiping which is far
from the meeting
place of people
and difficult for
customers to
frequent
7.5 SWOT for The Memories Bracelet
Strength
• Our products is limited edition.
• Provide various craft products.
• Cost for getting our products is low
compare to the competitors.
• Customer can request their own
design or they can choose our
design.
Opportunities
• Add more handicraft product such
as glass-painting, printing banner,
business card and others.
• Expand our business to other
places.
• Supplier to our products so the
cost can be reduced.
• Hire worker that have background
education in art and design.
Weakness
• New company in craft industry.
• Need to make a lot of
promotion.
• Not enough resources from
supplier.
• Out-to-date handicraft.
• No branding.
Threats
• Decrease of people interest to
handicraft products.
• Unexpected risk such as pick
pocket, stolen products, fire and
others.
• Well-known competitor
companies.
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7.6 Market Share
MIR CRAFT’S 55% 55% x 150,000 = 82,500
ELMO CRAFT’S 37% 37% x 150,000 = 55,500
THE MEMORIES BRACELET 8% 8% x 150,000 = 12,000
= 150,000
7.7 Sales Forecast
MONTH 2014 2015 2016 JUSTIFY
OCTOBER RM15,000 RM 17,250 RM 19,837.50
NOVEMBER RM15,000 RM 17,250 RM 19,837.50 BACK TO
DECEMBER RM17,000 RM 19,550 RM 22,483 SCHOOL
JANUARY RM14,000 RM 16,100 RM 18,515
FEBRUARY RM14,000 RM 16,100 RM 18,515
MARCH RM12,000 RM 13,800 RM 15,870
APRIL RM12,000 RM 13,800 RM 15,870
MAY RM13,000 RM 14,950 RM 17,192.50 LESS
PROMOTION
JUNE RM13,000 RM 14,950 RM 17,192.50
JULY RM 14,000 RM 16,100 RM 18,515
AUGUST RM 14,000 RM 16,100 RM 18,515
SEPTEMBER RM 14,000 RM 16,100 RM 18,515
TOTAL RM 167,000 RM 192,050 RM 220,858
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7.8 Marketing Strategy
Criteria
Description
Product Strategy Quality The Memories Bracelet‘s
provide good quality
product to our customers.
The quality is observed in
term of:
1 Design
2 Packaging
3 Attractiveness
4 Product Differentiation
5 Ease of use
Labelling
All products are labelled
and provide information
on the size, design, types
of product and in limited
edition.
Delivery services
We also provide delivery
services for customer who
located at other states.
Pricing Strategy Competition based pricing The Memories Bracelet‘s
use competition-based
pricing as its pricing
strategy. We have
competitors in Taman
Cempaka that sell the
same products for a
higher price to get more
profit per unit. However,
we at The Memories
Bracelet places greater
importance on customer
satisfaction for repeat
business. We have
reduced the price per unit
of our products and are
still able to get reasonable
profit from our sales. Our
competitive price will
ensure customers
continue buying from us in
the future and also attract
new customers.
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Promotion Strategy promotion The Memories Bracelet‘s
use various kind of
promotion such as
distribute pamplet, flyers,
using social media
instruments and shows
banner at suitable places.
Place strategy Place The Memories Bracelet‘s
are located at a suitable
place where many people
entered everyday. We
choose to place our
business at Taman
Cempaka,Ipoh.
7.9 Marketing Budget Estimation
MARKETING EXPENDITURE
PARTICULAR RM RM
MONTHLY EXPENDITURE
FUEL 100.00
MAN 500.00 600.00
OTHER EXPENDITURE
PROMOTION
Banting
25.00
Flyers
2,000.00
Pamphlet
1,500.00
Social media
-
4,325.00
GRAND OPENING 500.00 1,000.00
TOTAL 5,925.00
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7.10 Operation Plan
PROCESS FLOW CHART
SUPPLIES LISTING
- creative.com
- ready.com.my
ORDER
We make order to supplier to supply us the raw material that we need based on customer
request. We use online method as main method to order material, because it more easy.
STOCK RECEIVED
After we order the material, we received the stock in a few week or a few day
INVENTORY
We start to managed and arrange the stock according to the product. We also calculate a
new stock and current stock.
CUSTOMER ORDER
Then the customer that come or contact us to make an order. They can choose what they
want, and we take their order.
PROCESS
After that we will process the customer order to make or handmade thing. We have a two
person that conduct this process.
PAYMENT
After the customer order is done, the customer will make a payment to us. There have two
ways to make a payment. First they can make a payment by cash money. Second we also
provide a credit card and debit card machine, so they can use credit card or their debit
card.
MATERIAL REQUIREMENT
We calculated our material requirement based on our sales per month. Our monthly sale
is approximately 200 bracelet and 300 lanyard per month. By dividing the sales per month,
we can estimate how much quantity we need for each product in month. Hence , the total
cost of raw material per month is RM 625.00
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No. Item Quantity
Required
MATERIAL REQUIREMENT
Safety
Stock
Price per
unit (RM)
Supplier
Total
Amount
(RM)
1 Faux Suede (cord) 100 pack for
each colour (30
colour)
2 Charm
20 pack for each
(60 design) design
3 Alphabet (A-Z) 20 pack for each
alphabet
4 Crimp end
(have 4
measurement)
10 pack for each
measurement
- 4.00 Creative.
com
- 4.00 Creative.
com
- 2.30 Creative.
com
- 6.90 Ready.c
om
400.00
80.00
46.00
69.00
5. Jump Ring 10 pack - 3.00 Ready.c 30.00
om
TOTAL 625.00
7.11 Operation Budget Estimation
The table shows the operational expenditure of The Memories Bracelet Sdn. Bhd.
OPERATIONAL EXPENDITURE
RM
RM
Working Capital / Monthly Expenditure
Lease 3,000
Utilities (Overhead Cost) 1,500
Pos Laju Courier (pick up services) 500
TOTAL 4,500
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8.0 FINANCIAL PLAN
8.1 Schedule of financial sources:
THE MEMORIES BRACELET
SCHEDULE OF FINANCIAL SOURCES AS AT YEAR 2014
SOURCES
AMOUNT (RM)
A. Equity/Own Contributions
Cash 50,000.00
B. External Sources
Bank Loan 50,000.00
C. Others 0.00
TOTAL 100,000.00
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8.2 Proforma Cash Flow Statement
CASH INFLOW
CASH FLOWS ANUALLY
YEAR 1 YEAR 2 YEAR 3
RM RM RM
Owner Capital 50,000
Bank Loan 50,000
Sales 167,000 192,050 220,858
TOTAL CASH INFLOWS 267,000 192,050 220,858
CASH OUTFLOWS
Operating Expenditure
Raw Materials 73,662 70,000 73,662
Premise Rental 9,000 9,000 9,000
Utilities 2,400 2,400 2,400
Marketing Expenditure
Banting 25 25 25
Flyers 1,000 1,000 1,000
Pamphlet 1,500 1,500 1,500
Fuel 1,200 1,200 1,200
Man 6,000 6,000 6,000
Admin Expenditure
Wages 57,600 57,600 57,600
Other Expenditure
SSM 70 60 60
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Stationary 350 200 200
Fire Extinguisher 400 - -
Broom 10 - -
Dustbin 5 - -
Asset Expenditure
Air Conditioner 1,000 - -
Furniture 9,000 - -
Computer 4,000 - -
Telefon & Fax 1,500 - -
Payment of Deposit
Deposit 1,500 - -
Utilities 2,000 - -
Loan Payment
Principal 5,000 5,000 5,000
Interest 500 500 500
TOTAL CASH OUTFLOWS 177,722 154,485 158,147
Excess/(Deficit) 89,278 37,565 62,711
Opening Cash - 89,278 126,843
Ending Cash Balance 89,278 126,843 189,554
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8.3 Proforma Income Statement
THE MEMORIES BRACELET
PROFORMA INCOME STATEMENT
YEAR 1 YEAR 2 YEAR 3
RM RM RM RM RM RM
SALES 167,000 192,050 220,858
COST OF GOOD SOLD
OPENING STOCK - 6,139 5,833
ADD: COST OF GOODS
SOLD 73,662 70,000 73,662
GOOD AVAILABLE FOR
SALE 73,662 76,139 79,495
LESS: CLOSING STOCK (6,139) (67,523) (5,833) (70,306) (2,000) (77,495)
GROSS PROFIT 99,477 121,744 143,363
LESS: OPERATING
EXPENSES
OPERATING 2,400 11,400 11,400
MARKETING 9,725 9,725 9,725
ADMINISTRATION 57,600 57,600 57,600
PREMISE DEPOSIT 1,500
RENTAL 9,000
UTILITIES DEPOSIT 2,000
INTEREST 500 500 500
OTHER EXPENSES 835 (83,560) 260 (79,485) 260 (79,485)
NET PROFIT 15,917 42,259 63,878
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8.4 Proforma Balance Sheet
FIXED ASSETS
THE MEMORIES BRACELET
PROFORMA BALANCE SHEET
YEAR 1 YEAR 2 YEAR 3
RM RM RM RM RM RM
AIR CONDITIONER 1,000 1,000 1,000
FURNITURE 9,000 9,000 9,000
COMPUTER 4,000 4,000 4,000
TELEPHONE & FAX 1,500 15,500 1,500 15,500 1,500 15,500
CURRENT ASSET
BANK 89,278 126,843 189,554
STOCK 6,139 95,417 5,833 132,676 2,000 191,554
110,917 148,176 207,054
OWNER EQUITY
CAPITAL 50,000 50,000 50,000
ADD: NET PROFIT 15,917 65,917 58,176 108,176 122,054 172,054
NON CURRENT
LIABILITIES
LOAN 45,000 40,000 35,000
110,917 148,176 207,054
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9.0 CONCLUSION
Based on the planning and projection of income and expenses, the company is very confident
that this business venture will create a satisfactory return on investment from the second year
of operation. For the first year, we are estimating to incur a very minimal loss as we have
made a conservative estimate of sales and expenses based on the fact that the company has
just started the operation.
The business will continuously perform the business strategies, especially on the
marketing aspects to ensure that the business is well known to the customers and we hope
to build a loyal customer base in the second year of operation. we hope our business venture
is able to become part of the successful Masyarakat Perdagangan dan Perindustrian
Bumiputera (MPPB) in Malaysia.
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10.0 APPENDICES
Business Registration Form for Sole Proprietorship and Partnership (Form A)
Application Form to Renew Business Registration Certificate (Form A1)
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