Group 1-Marketing Business Plan

8/8/2019 Group 1-Marketing Business Plan

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Acknowledgement

We would like to thank all the faculty members of Amrita School of Business, especially our

marketing faculty, Satheesh Krishnamurthy Sir, who provided us with immense help and

support. We would also like to thank each and every person who took part in our market

survey and helped make this project a reality. A special thanks to Baby Shop, Trivandrum

for sharing with us their experience in this field.


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Table of Contents

S. No. Page No.

Executive Summary 5

1. About the Company 61.1 Our Goals 6

1.2 Products 6

1.3 Profile of the Management Team 6

1.4 Company Location and Facilities 7

2. Situational Analysis 8

2.1 Market Summary 8

2.2 SWOT Analysis 9

2.3 Competition 10

2.4 Keys to Success 10

2.5 Critical Issues 10

2.6 Macro Environment 11

3. Marketing Strategy 12

3.1 Mission 12

3.2 Marketing Objectives 12


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3.3 Financial Objectives 12

3.4 Target Markets 12

3.5 Positioning 13

3.6 Strategies 13

3.7 Marketing Mix 14

3.8 Marketing Research 14

4. Financial, Budgets and Forecasts 16

4.1 Break Even Analysis 16

4.2 Sales Forecasts 17

4.3 Expense Forecasts 18

5. Demand Forecasts 19

5.1 Initial Marketing Strategies 21

6. Contingency Planning 22

7. References 23

8. Appendix 24


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Kidzeee is a one stop shop for children providing a variety of childrens books, toys and

clothes. Our target market are the children below the age of 14 and their parents. In this time

constrained era we provide the parents with a more convenient way of shopping and also

provide the children with a more enjoyable shopping experience.

We carried out a market survey to determine the exact needs of our target audience and to

help us take decisions about certain crucial factors such as location, pricing etc. We

conducted our survey in R.S Puram and Gandhipuram. We found out that there is a

reasonable demand for this type of a store in coimbatore and that R.S Puram was the most

preferred location.

The kids' wear market is growing at the rate of 10% per annum and the Indian toy sector is

growing at the rate of 15-20% every year. Besides the survey results being in our favour,

these statistics also seemed to suggest that there is a lot of potential for a store like Kidzeee.

Our store aims at providing quality products and customer satisfaction is our main focus. We

have a play area for children which enables them to have fun while shopping. We also

organise story telling, drawing, essay writing competitions etc every Sunday to help children

exhibit their talents.


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KIDZEEE

1. About the Company

Our shop would be a one stop shop for children below fifteen years of age. We will provide

them dress, toys and books.

1.1 Our Goals

We aim to become partners in childrens development and want to be recognised as the first

choice when childrens needs are concerned.

1.2 Products

Our primary area of concern would be dress, book, and toys for children. The dress category

includes all latest fashion and design .We are promoting toys that are being certified by all

recognised agencies for their safety and contents. Childrens books by eminent authors like

Enid Blyton will occupy high priority on our shelves.

As our survey revealed that parents are most dissatisfied about the choice of dresses available

in the city so we are giving them a benefit of custom made dress for their children. We have a

catalogue of design made by our own master tailor. Parents and children will have to choose

only the material and rest will be taken care of.

We want to be recognised as a Brand for children stores, therefore we are promoting only

branded goods. The brands on our shelf will include Ruff Kids, Weekender Kids, Jinni &

Johnny.

1.3 Profile of Management Team

There would be no compromise on eligibility and efficiency of management team. We have

divided the management areas amongst ourselves, which we believe we could contribute

significantly.


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Management team is given below:

Aditya.Nair.R (BTech.CS, MBA) RajivRamachandran(BTech EC, MBA)

Systems Coordinator Marketing

Amardeep Sodhi(BCom.,MBA) Manu Mooss(BTech.ME,MBA)

Finance and Accounts Operations

Vilas V.K.(BTech.Textile,MBA) Veena M.G(B.Sc.,MBA)

Sourcing Human Resource

The division of task is not rigid. There is great room for flexibility and information sharing

which would allow every member to update facts and details about every other area.

We plan to start the business in the month of January 2008 to benefit from the Pongal

Festival sales which is usually the best time.

1.4 Company Location and Facilities

Location: R.S. Puram 100 Feet Road,

Coimbatore.

Building Agreement: The agreement is such that we will pay an

advance of 10 lakhs, and we are liable to pay a

sum of Rs.25000 per month and this rent is

revised by Rs.5000 every 2yrs.

Facilities: The current building is a one storey building with

a floor area of about 3000sq.ft, located about 100

ft. away from the main road. The house has open

space around it which would serve as a parking

facility. There would be major alterations needed

which the owner has agreed to. The expense for

the alteration has to borne by us and it has to be

left after its useful life.There is enough space to

develop a mini-park in front of the store.

Operating Hours: 8 am- 9 pm , Sundays open.


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2. Situational Analysis

2.1 Market Summary

Research conducted by us has helped us obtain informations about the current market

situation which will help us in the setting up and running our enterprise successfully. It has

helped us to understand our target audience better which in turn will allow us to serve their

needs more effectively.

2.1.1 Market Demographics

Coimbatore is situated in the extreme west of Tamil Nadu, near the state of Kerala. It is

surrounded by mountains on the west, with reserve forests and the Nilgiri Biosphere Reserve

on the northern side. Its demography is as follows:

It has a population of 4.2 million. 11% of the population comprises of children below 6 yrs of age. The city has a multi-cultural society, mostly of cosmopolitan nature. It is one of the fastest growing cities in India and is known as the Manchester of the

South India

2.1.2 Market Needs

The survey conducted by us helped us to determine the market needs more efficiently. We

seek to fulfil the following needs that we found were important to our customers:

Offering childrens clothes, books and toys under one roof, and thus saving oncustomers valuable time.

Offering a wide variety of the above products. Making shopping an enjoyable experience for parents and kids.

2.1.3 Market Trends

Trends in the market are fast changing. One of the important changes is the increasing

preference for branded apparel. This shift is taking place on account of changes such as a rise

in the disposable income of the people and the increasing influence of foreign culture. The

other important change that is taking place in this area is the emergence of kids as an


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independent buyer group. Influenced by mass media and peer pressure, today's kids are more

informed and self-conscious.

2.1.4 Market Growth

Children's apparel includes clothing for kids between 1 and 14 years of age. The market for

kids' apparel in India exceeds Rs.13000 crore, of which around Rs.3000 crore is constituted

by branded kids' wear. The kids' wear market is growing at the rate of 10% per annum, which

makes it one of the fastest growing markets.

According to the Toy Association of India, the Indian toy industry is worth Rs 25 billion by

domestic production but toys worth nearly Rs 70 billion are imported from China. The Indian

toy sector is growing at the rate of 15-20% every year.

Parents today realise that it is important for their children to develop good reading habits.

Thus, they are willing to spend more on books today than they were a few years ago. Hence,

the childrens books market also has a lot of potential.

2.2 SWOT Analysis

The following SWOT analysis captures the key strengths and weaknesses within the purview

of our business and the market.

Strengths

Offering childrens books, toys and clothes under one roof, thus making shoppingeasier and more convenient.

Offering a wide variety of the above products. Offering branded apparel like Ruff Kids, Weekender Kids etc also toy makers like

Funskool will be sold at one place.

Being the one and only shop of this kind in all of Coimbatore city is definitely anedge .

Weaknesses

Our KIDZEEElacks brand equity.


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We have a limited marketing budget to spread awareness about our company.Opportunities

First of its kind in the city. Coimbatore An educational hub of Tamil Nadu.

Threats

People might prefer going to exclusive shops for clothes, toys and not to one shop thatoffers everything.

Emergence of organised retailing like Big Bazaar, Reliance R-Mart in the city.

2.3 Competition

Ours is the only shop of its kind in Coimbatore city, but we still face competition from

exclusive stores for books, toys and clothes like Odyssey, Chennai Silks, Shree Devi textiles

etc. These are already established shops with a strong following of loyal customers. It might

take considerable time to build a strong customer base.

2.4 Keys to Success

Quality Products, at their best value. Outstanding customer service. Making shopping an enjoyable experience for parents and childrens. Making shopping more convenient.

2.5 Critical Issues

The critical issues facing our company are recovering our fixed costs and expanding business,

both at the same time. In order to do this we must adopt a modest fiscal approach and expand

at a reasonable rate keeping the economical feasibility in mind.


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2.6 Macro-Environment

2.6.1 Demographic Environment

The demographic profile of India is a great marketing asset. While, as per 2004 data, people

in the 0-14 years age group constituted 31.7 per cent of the population, the 15-64 years age

group forms 63.5 per cent and the people above 65 years constitute the balance. (URL: http:

//www.hindubusinessline/2006/10/14/stories, 14-10-2006)

2.6.2 Economic Environment

In India, the total number of consuming class with an annual income level between $1,000

and $4,800 around 75 million households in 2006 compared to 29million households a

decade ago. (URL: http: //www.hindubusinessline/2006/10/14/stories, 14-10-2006)

2.6.3 Sociocultural Environment

Nowadays, time is a major constraint for people. They aspire for convenience in all the

services they use.


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3. Marketing Strategy

The key to marketing strategy is focusing on the availability, ease in shopping, and

accessibility to the store.Kidzeee can cover up to 40 % of the market because the products in

the store cover the three main aspects regarding shopping for kids(i.e. dresses, books and

toys.) .Though each of these items cover three different segments in terms of products but

the end users are the same. i.e. children

3.1 Mission

Kidzeees mission is to provide parents a one stop shopping store for their children (primarily

upto the age of 15), providing them with variety of apparels, books and fun products. Weexist to provide ease and comfort of shopping for the customers.

3.2 Marketing objectives

Maintain positive, strong growth each year (irrespective of the store locationconstraints)

To expand upto more than 25 stores in all the metropolitan cities with a steady marketpenetration within the next 10 years

To use backward integration technique reduce overall costs of sales, reduce timebetween ordering and delivering in some of the store product like toys and apparels.

3.3 Financial objectives

Increase the net revenue by more than 10 percent per year through efficiency andeffective implementation of marketing strategy.

To obtain a healthy percentage of market share within the first year of inception.3.4 Target markets

As we are a country where more than 30% of the population is below 15 years. And with a

very few number of stores operating full scale concentrating on exclusive children stores, an

untapped segment comprising of parents with shopping time constraints, who prefer shopping

for children from a single store could be easily identified. Such a market segment could be

tapped using the current market trends and its effects. Our marketing survey reports indicate


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that a majority of parents would like such a store to open up. Kidzeee targets parents with

shopping time constraints. Children surveyed also preferred shopping through a single store

stating ease of selection of products they use and lack of availability of variety of the three

products in a single store. So children could be a part of the target market, (kids who shop

themselves). But the majority target market would be parents who are the major shoppers.

3.5 Positioning

Kidzeee will position itself as a one stop shopping store for all kids basic utilities pertaining

to their fashion, fun and learning. This positioning would be achieved by providing parents

with a wide range of apparel, books and fun filled games and toys. The point of disparity

being clearly variety in availability of children products. The point of parity being established

exclusively for children.

3.6 Strategies

The objective of Kidzeee is to position itself as a one stop shop exclusively for children. The

marketing strategy aims to create customer knowingness about the offered products, their

price ranges, variety of products. These would be achieved primarily through advertisements

in initial stages as majority of Indians go for a product through its advertisements. Print

media would be given a major preference in advertisements as our stores are localized to the

resident city people for which print media is the most accessible. Television advertisements

would be used as complementary method of marketing strategy. Promotion and

advertisement would also be done by co branding the store with a bank and any leisure

providing organization like restaurants, theatres.

The second method would be through the organizations website providing an insight into

stores, product ranges, product varieties and store locations. It would cover all the aspects

included in the primary method of marketing. The cost for advertisements is expected to be

higher since the store is in its initial stages. Gradually the cost of advertisement would

reduce to minimal.


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3.7 Marketing Mix

Kidzeees marketing mix is comprised of the following techniques based on pricing, place

and, advertisement and promotion

a) Pricing

Pricing is based primarily on the buying price with an extra premium of maximum of 15%

above the market price.

b) Place

The store would be placed at a well accessible location inside the corporation limits of the

city, with adequate parking facilities.

c) Advertising and promotion

Several different methods will be used for the advertising effort. This would include

co- branding with banks and leisure providing organizations within the city.

3.8 Marketing research

With the advancement of globalization and increased pace of life, parents find it extremely

difficult to go into different stores for purchasing different products. Since this trend is on the

rise in India, it was eminent that such a store would serve the customers upto their

expectations. The survey conducted confirmed the above statements with majority of parents

favouring in the establishment of such a store. Their suggestions during survey helped in

determining the preferred store location. Time for shopping which was the major constraint

was identified as expressed by the parents.


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Sample size : 85

Area of survey : RS Puram, Gandhipuram and Race Course- Kovai

Date : 6th october, 2007


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4. Financial, Budgets and Forecasts

This section will give the financial overview of the firm related to marketing activities. The

firm will address the Break Even Analysis, Sales Forecasts, and Expense Forecasts and how

these activities linked with marketing strategy.

Budgets

As this is a partnership business all the members of the management team invests an initial

amount of Rs.8 lakhs each and the remaining capital was raised through bank loan. The

Company took a loan of Rs.25 lakhs from Catholic Syrian Bank to be paid back in 5 years

with an interest rate of 17%.

4.1 Break Even Analysis

BREAK EVEN

0

5,000,000

10,000,000

15,000,000

20,000,000

25,000,000

30,000,000

1 2 3 4 5 6 7 8 9 10 11 12 13 14

YEARS

Rs. Sales

Expenses

Break even point is the point where the revenue line meets the expense line .Based on the

sales and expense forecasts and also the demand forecasts we expect to break even from sixth

year onwards.


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4.2 Sales Forecasts

From the market survey report we found that there exists a great demand for the three items,

especially branded apparels for kids. Based on the current market trend and economic

situation we expect an increase in our sales by 14% for the first 3 years and 10% for the next

10years.

The data we collected from the various Stores has helped us to predict this increase in sales.

The Data from Funskool (the main supplier of toys) show that they predict a yearly increase

of 12% in Coimbatore Sector. We expect an increase of 5 % in sales every year due to the

competition from established shops like ODYSSEY.

The research conducted by us show that there has been an increase of 12% every year in

other major stores. Correspondingly we predict a 7% increase in sales of books since we are

just starting up our enterprise.

We believe that the latest trends show that the children are more attracted towards trendy and

branded apparels. We are the only providers of the branded items in Coimbatore city. We

expect an increase of 16% in the apparel segment.

Our sales mainly depends on the festive season in Tamil Nadu especially in months ofJanuary (Pongal), April(Tamil New year) and during the months of October and

November(Deepavali).We also expect a decrease in sales during March as the exams are


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conducted during this month.

Expected Monthly Sales

-100000

100000

300000

500000

700000

900000

11000001300000

1500000

1 2 3 4 5 6 7 8 9 10 11 12

Month

Rs.

Series1

4.3 Expense Forecasts

We expect an increase in expense of 3% every year for the first three years, 5% for the next

five years and then an increase of 8% there onwards. Monthly expense include monthly

interest of bank loans, Marketing expenses Salary & Allowances, Electricity and Water

charges, Dress materials, Toys and Books and also we amortise our initial expense with in 5

years permitted by Indian Accounting Standards.The following graph depicts the monthly

expense for the store in a year. Expenses for the month of march are the least in year as the

expected sales for the particular month is lower owing to the on going examination season.

Expected Monthly Expense

0

500,000

1,000,000

1,500,000

2,000,000

1 2 3 4 5 6 7 8 9 10 11 12

Months

Rs.

Series1


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5. Demand Forecast

We are trying to position ourself as a premium outlet offering goods and services st their best

value. This choice ultimately puts a constraint on our target market. Our Target market could

have been roughly estimated as children under the age of 14 who are studying in schools.

But, the premium pricing offered by us would encourage only parents of children who are

affluent enough to buy brands for their kids.

If we had no pricing constraint our target Market would have been much larger it would

have included children studying in all government, private and government aided schools.

But, offering premium prices has reduced our target market to children who are studying in

private schools. This decision of ours is backed by evidences which we obtained in our

market research, which says that parents send their children to private schools expecting

quality, knowledge and healthy habits. The number 362 represents the number of private

schools in coimbatore.

The total number of schools in Coimbatore - 2778 Our Target Schools - 362

Chart 5.1

The table below shows the number of schools in each category in the city of Coimbatore.


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The table below shows the population of school children age wise. The projected increase in

the school going children population is shown below based on Household survey

2005(Provisional)

The final column in the table below illustrates the rate of growth of school going children in

each category. The population growth rate of Tamil Nadu is around 11.19(Source: Census

2001) and the average growth rate of school going population is around 8%. Hence, we

assume that our demand also to grow at a minimum rate of 7%.

Actual Target Schools

Private Schools by category No: of schools

Primary School 329

Middle School 44

High School 150

Higher Secondary School 168

Total No: of target schools 362

Total No: of schools in Coimbatore 2778

Some schools are

included in many

categories, hence the

difference


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As a part of our initial marketing activities and also because of our financial constraints,

initially we would like to target all our marketing activities towards some few schools listed

below. The number of these schools in this list would be revised taking market preference

into consideration. The schools that have been identified are based on the fees that they

charge, the average income of the parents of children in these schools and also a subjective

study of their buying habits. The strength as on date has been given below and a 7% increase

in the school strength has been taken into consideration. We consider these parents to be

wealthy and well informed and who always place quality before price. Therefore every

attempt from our side would be made to make sure that we are recognised and appreciated

and also a preferred choice for their shopping activities.

5.1 Initial Marketing strategies

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6 Contingency planning

Partnership firm always carries along with it a factor called risk. Every attempt will bemade to ensure that differences dont harm our existence. We have entered into a

legal contract which prevents any withdrawal of capital before a period of 10 years

but periodic distribution of profit based on the proportional investment.

Threats from retail giants like Big Bazaar, R-Mart and Wal-Mart is unavoidable. Oursafe stand would be to create loyal customers and that would be done with due care.

Unforeseen events like Fire, Theft are always there for every organisation. We haveinsured our store, our insurance partner is ICICI.

We operate on a rented floor area and so there is always a possibility of we enteringinto a dispute with him. We have entered into an agreement which would allow us tooperate in the same place unless we decide


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7 References

1. Census data- www.genedusat.com2. URL: http: //www.hindubusinessline/2006/10/14/stories, 14-10-2006)3. www.funskoolindia.com4. Marketing Management, Philip Kotler & Kevin Lane Keller,5. Legal aspects Of Business, A. Pathak, third edition, Tata-McGraw Hill.


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Appendix

Questionnaires

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Documents

Group 1-Marketing Business Plan