neat $ clean

8/2/2019 Neat $ Clean

1/32

May 8, 2011BUSINESS PROPOSAL ON NEAT AND CLEAN

1

BUSINESS PROPOSAL ON

NEAT AND CLEANNEAT AND CLEAN

Laundry

Hand wash

Dry Cleaning

Ironing

2011

Proposed by Kinley Chencho and Complied by Jigme Tenzin (Consultant) for enquiry

email at [email protected]

NEAT AND CLEAN

5/8/2011
http://calc_price%28%27rf%27%2C%270041-0702-2510-0646%7C3000%7C1558%7Ccommercial%7C%7C%7C1%7C0%27%29/http://calc_price%28%27rf%27%2C%270041-0702-2510-0646%7C3000%7C1558%7Ccommercial%7C%7C%7C1%7C0%27%29/http://calc_price%28%27rf%27%2C%270041-0702-2510-0646%7C3000%7C1558%7Ccommercial%7C%7C%7C1%7C0%27%29/http://calc_price%28%27rf%27%2C%270041-0702-2510-0646%7C3000%7C1558%7Ccommercial%7C%7C%7C1%7C0%27%29/


2/32


2

CONFIDENTIALITY AGREEMENT

The undersigned reader acknowledges that the contents of this business plan

are kept confidential. The reader after having finished reading, whether willing to invest

or not, agrees not to disclose information other than which are under public domain

through other means, any misuse of the information especially in other business inwhich Mr. Kinley Chencho is not involved is a punishable offence under Breach of Trust,

sec(265) of Penal code of Bhutan.

Any suggestion leading to improvement of this business plan is promptly

welcomed.

Name of the reader Date Signature


3/32


3

Executive Summary

Neat and Clean, the proposed name for the laundry servicing centre to be established

by the promoter Kinley Chencho will be located in the heart of the town, opposite to BNB(Bhutan National Bank). The business will be held jointly by all the workers who are in fact

family members. It will cater the needs of thousands of people of all age groups, who just wish

that their clothes be washed by someone at a minimal cost and more so because their favorite

clothing needs a special care.

This is why Neat and Clean is in an attempt to enter the market to capitalize on the

weaknesses in the service delivery of the existing competitors. Unlike most of the existing

competitors, Neat and Clean will endeavor in giving individual attention to the customers need,

with this aim in mind it has re-engineered the service list with discounting on bulk order made

for the service, it will also provide free door-to-door collection and delivery with just 1 day

delivery time. As will be mentioned in the following (competitive Analysis), there are so much

Neat and Clean has to offer to its customer which thus serves as a USP (Unique Selling

Proposition) for the business plan to materialize.

Neat and Clean is also in an attempt to follow improved business management

strategies as JIT method for the inventories which are available in and around the business

premises. It has high ambition of exploring new market in the pursuit of Blue Ocean, which

would make it certain for the projected business plan to run in a manner as expected in terms

of financial and overall operation of the business. It has indeed negotiated a deal with focalperson of Punatshang Chu I hydro project to render the service the need for which is felt

urgently by the workers residing there.

The total project cost of the business is Nu.1120200/- out of which Nu.1000000 will be

funded by Loden Foundation if found viable and the rest will be supplemented from other sources. The

principal reduction will be duly made within a period of 2 years and 8 months.

The projected net profit over sales in the first year of its operation is 31.6% over sales. Such

figure could be drawn due to milder terms of the loan with no interest, no mortgage, condition, which

is indeed a boon to a lower middle class people like the promoter who is short of capital even though hehas had dreamt of owning one years back. Therefore, it is not until now, that with such noble initiative

taken by Loden Foundation, the promoter could come one step closer to realizing its dream for the

benefit of self, family and community as a whole.


4/32


4

Table of Contents1 PROJECT PROFILE ....................................................................................................................................... 6

1.1 BUSINESS PROFILE............................................................................................................................... 6

1.2 PROMOTER DETAILS ........................................................................................................................... 6

2. Vision ......................................................................................................................................................... 7

3. OBJECTIVES: .............................................................................................................................................. 7

4. SWOT ANALYSIS ........................................................................................................................................ 7

5. Key to Success: .......................................................................................................................................... 8

6. Business Summary .................................................................................................................................... 8

6.1 Business Ownership ............................................................................................................................ 8

6.2 Business Description ........................................................................................................................... 8

6.3 Location and scope of business in the location; ................................................................................. 9

7. Marketing Analysis ................................................................................................................................ 9

7.1 Product/ Service Description .............................................................................................................. 9

Services offered ........................................................................................................................................ 9

7.1.1 Dry Cleaning ..................................................................................................................................... 9

7.1.2 About Hand Wash service ............................................................................................................ 10

7.3 MARKET SEGMENTATION ................................................................................................................. 11

7.4 SHARE OF MARKET ............................................................................................................................ 12

7.5 ROI FROM DIFFERENT TARGET MARKET ........................................................................................... 12

7.6 NICHE MARKET .................................................................................................................................. 12

7.7 Competitive Analysis ......................................................................................................................... 13

7.8 Promotional and Advertising expenses ............................................................................................ 13

7.9 PRICE ESTIMATION ............................................................................................................................ 14

7.10 PRICE SCHEDULE FOR NEAT AND CLEAN ........................................................................................ 15

7.11 PRICING STRATEGY.......................................................................................................................... 17

8. SALES ESTIMATION ............................................................................................................................. 18

JUSTIFICATION: ....................................................................................................................................... 18

8.1 ROI FROM DIFFERENT TARGET MARKET ........................................................................................... 19

8.2 BUYING PATTERN: ............................................................................................................................. 20

9. FINANCIAL COSTINGS .............................................................................................................................. 24


5/32


5

9.1 TOTAL PROJECT COST ....................................................................................................................... 24

9.2 CAPITAL COSTING (WITH DEPRECIATED END VALUES OF THE ASSETS OVER 5 YEARS).................... 25

9.3 ADMINISTRATIVE COSITNGS ............................................................................................................. 25

9.4 INVENTORY COSTING ........................................................................................................................ 26

9.5 MANPOWER COSTING ...................................................................................................................... 26

9.6 MARKETING COSTING ....................................................................................................................... 27

10. FINANCIAL REPORT ............................................................................................................................... 28

10.1 PROFIT AND LOSS ACCOUNT PROJECETION FOR THE YEAR ENDING 2012-2016 ........................... 28

10.2 BREAK EVEN ANALYSIS .................................................................................................................... 28

10.3 PROJECTED CASHFLOW STATEMENT AS ON DEC 30, 2012-2016 ................................................... 29

10.4 PROJECTED STATEMENT OF BALANCE SHEET AS ON DEC 30, 2012-2016 ...................................... 30

11. AMORTIZATION OF LOAN ..................................................................................................................... 31

12. CONCLUSION ......................................................................................................................................... 32


6/32


6

1 PROJECT PROFILE

1.1 BUSINESS PROFILEPROPOSED BUSINESS NAME NEAT AND CLEAN

PROPOSED OWNERSHIP FAMILY BUSINESS

PROPOSED BUSINESS TYPE LAUNDRY SERVICE

PROPOSED FINANCING 100% DEBT FINANCING FROM LODEN FOUNDATION

PROPOSED LOCATION OPPOSITE TO BNB, THIMPHU; BHUTAN.

TOTAL PROJECT COST Nu. 1 million

STAFF STRENGTH 5 IN TEAM (FAMILY MEMBERS)

1.2 PROMOTER DETAILS

Name Kinley Chencho

Citizenship ID No. 11913001434

Address Permanent Address;

Village: Nginsergang. Gewog: Ruepisa

Dzongkhag: Wangdi Phodrang

House no: Tsha-13-115 Thram

no:123

Present Address:

Thimphu, Bhutan

Credentials Worked in a laundry service shop (Spotless)

for about 4 years and has technical skills on

maintenance of the machines during break

down, has large network of customers base

and knows deficiency in services rendered by

the existing laundry service providers.


7/32


7

2. Vision

To be thepreferred laundry service provider in Thimphu City

3. OBJECTIVES:

1. Capitalize major share of market by 2013

2. Affordable access to laundry service

3. Capture uncontested market through Blue Ocean Strategy

4. Ensure timely repayment of loan

5. Double the number of employees by 2012

6. Reengineering the existing system in rendering the service to its customers

4. SWOT ANALYSIS

Strength

Good knowledge of the promoter.

Good customer base

Proactive strategies for service delivery

Good pricing strategy

Ideal location

High market demand

Improved service from existing competitors

Weakness

New in the market

Scarcity of water resources

Opportunity

Technology development

More services offerings

Immense scope of diversification in the same

business line

To establish branch of our business in other

Dzongkhag.

Good income of the localities. Increasing population

Threats

Technology damages

New entrants

Change in policy or registration of the

business

Natural calamities

Losing skilled staffs

Misbehavior of our staffs may result in

loosing daily customers.


8/32


8

5. Key to Success:

Getting organized and planned

Right location

Good communication skills

Risk bearing Using the right ingredients and mixtures

Using good quality laundry equipment

Keeping the employees and self satisfied with the service, job and capital

Marketing and advertising the business

Management of time especially pickup and delivery

Attract more customers

To act according to the reliable feed backs by the customers

6. Business Summary

6.1 Business Ownership

Neat & clean will be a family business promoted by Kinley Chencho, the head of

the family. The promoter will be the legitimate profit retainer and will retain 5% of the

profit for family expenditure and will be well aware of its obligation to Loden

Foundation for its financial services

6.2 Business Description

Neat & clean will offer the community with affordable and easy access to

washing clothes ranging from garments of both ladies and gents of all ages-western and

Bhutanese-house hold apparels to uniforms and heavy duty wash. Neat & clean has

designed a system so as to ease the access to service by establishing two collection

centre in a strategic location i.e. one nearby Chang Ji Ji colony and another one in RICB

colony, the network is near to completion with deals already negotiated with the focal

person in the regions, the same route will ensure on-time delivery, thus at both ends

Neat & clean will cater the needs of the customers , thus saving their time and money

and most of all providing convenience in availing the service. Neat & clean is also in the

process of establishing another collection centre in Punatshang chhu I colony with

negotiation with the focal person in process, this way neat & clean intends to capitalize

uncontested market and do away with competition thus saving cost by not investing in

inefficient and expensive promotional and marketing expenses.


9/32


9

6.3 Location and scope of business in the location;

Neat & clean will be located in Norzin Lam, opposite to BNB (Bhutan National

Bank), Thimphu; Bhutan. The location is strategically set as it is located in the heart of

the town where there is place for parking vehicles for the customers and will also be

lured to visit due to many shops placed in the location.

7. Marketing Analysis

7.1 Product/ Service Description

Services offered

Laundry

Dry Cleaning

Hand wash

7.1.1 Dry Cleaning

About Dry Cleaning and Laundry

Professional laundering for Gho, shirts, Pants and other "washable" items is a process

we can use to keep the garments looking their best. Special detergents, additives, and finishes

information has been collated which will set commercial laundering apart from home

laundering.

The laundry and dry cleaning process which we are proposing will enable us to offer

consistent quality to any garments at reasonable prices. Clothes fiber comes out cleaner and

the professional pressing affords a crisper finish. The feedbacks from the Customers will be

always accepted for the potential improvement of cleaning the garment.

Although dry cleaning is a commercial process (laundry can be done at home) the

essential steps of the dry cleaning and laundry process has not changed much over the years,

however, the industry has become much more service orientated.

We do understand that Customer service is now as important as the quality of cleaning.

At Neat and Clean , we are planning to take the training and train the staff for fabric care, stain

removal, folding lacework, fine-work, starching, hand finishing and the all important

presentation.


10/32


10

Another very important aspect we are planning to setup at Neat & Clean is the fine art

of running a collection and delivery service in the city of Thimphu.

Cleaning Steps for Dry Cleaning and Laundry by a Neat & Clean professional will involve

many different operations, all performed under the supervision of skilled people and designed

to give your garments a fresh and clean appearance.

Procedures will include:

1. Checking the care label for instructions and fiber content.

2. Classifying the garment according to fabric type, color and degree of soiling.

3. Removing spots and stains using special equipment and stain removal techniques

4. Dry cleaning only if so labeled

5. Reapplying any sizing, water repellency or other finishes when necessary

6. Finishing the garment on professional pressing equipment to restore its original

shape and appearance.

7. Replacing buttons or performing minor repairs as necessary

8. Packaging the garment in protective wrapping

Along with the above procedures, Neat & clean will offer additional services such as

garment storage for 10 days, cleaning furs and leathers, rug cleaning, drapery cleaning, smoke

removal, pillow cleaning, family laundry, Precious and Occasional Clothes preservation, and our

top-notch alterations and repairs service.

Cleaning Steps for Dry Cleaning and Laundry Professional cleaning involves many

different operations, all performed by skilled people and designed to give the garments a fresh

and clean appearance.

7.1.2 About Hand Wash service

Hand-washing clothes are cheap and easy if you do it yourself. It's the time consuming

nature of hand washing that attracts a premium 0f 25% to 35% over our proposed machine

wash laundry service. We recommend it when the garment is delicate, colorfast or liable to

shrink. Some customers prefer it even though the manufacture label indicates machine

washable.


11/32


11

We usually hand-wash late in the day and allow the clothing six to ten hours to dry

overnight.

NOTE:

The Neat & clean will offer its customers with convenient and affordable laundryservice. The laundry service is divided into three stages viz. a vise; laundry, Dry cleaning

and pressing service. For most of the items all three services are offered with exception

to some of the clothes which cannot be serviced due to quality and size of the made like

that of garments made out of silk that cannot be given pressing service.

The laundry services with three stages are left in the hands of individual

customers who may choose all or one of the service stages. However those who avail

laundry service will also are offered dry cleaning service in a package with separate

rates. The pressing service is optional then.

Neat & clean has come up with different product list with 5 customizedpackages. Neat & clean has also created a good customer base with Collection centre in

the niche market which will serve the purpose for both pre-service (placing order) and

after sale service (home delivery), thus ensuring focus and guaranteed market for the

benefit of the business and creating customer loyalty. This in turn will ensure timely

repayment of the loan to Loden Foundation for its generosity.

7.3 MARKET SEGMENTATION

The market for Neat & clean can be divided into the following categories according to

the customers life style ,buying pattern, re-engineered price list and network of customer

established by the promoter.

School students

Office goers

Hotels/Restaurant


12/32


12

7.4 SHARE OF MARKET

TARGET MARKET TOTAL POPULATION PROJECTED SHARE OF MARKET2012 2013 2014 2015

HOTELS 30 9 10 13 13

RESTAURANT 50 3 5 7 7

C.C 2000 200 250

CENTRE POINT 1500 150 200 250 250

RICB 2000 200 250 250 250

INDIVIDULS 2000 200 250 300 300

7580 762 965 820 820

7.5 ROI FROM DIFFERENT TARGET MARKET

MARKET SEGMENT ROI % OF ROI

HOTELS 315000 24.7059

RESTAURANT 100000 7.84314

C.C 400000 31.3725

CENTRE POINT 80000 6.27451

RICB 100000 7.84314

INDIVIDULS 280000 21.9608

TOTAL 1275000 100%

7.6 NICHE MARKET

The niche market for Neat and Clean are the high standard hotels which has tourist as ittarget market. As of now Neat and Clean has strong customer base with 9 hotels and 3

restaurants. Restaurants and hotels in particular have a defined buying pattern for the services

Neat and Clean has to offer. Therefore they are the only target market on contract basis

availing the Hotel/Home package (see new service list) on regular intervals. This would ensure


13/32


13

at least Nu.3000 of laundry and dry cleaning service from each hotel on an average i.e. taking

into account only 20 days a month and 10 months a year.

The prices for this target market are on an industrial average rate for the newly created

market and 15% discount to the old hotels.

7.7 Competitive Analysis

Unlike most of the existing competitor in the locality neat and clean will provide

the following benefits to its customers to capitalize the market

1. Doing away with competition by focusing on uncontested market

(Implementation of the Blue Ocean Strategy).

2. Providing the customers with Collection Point in the niche market.

3. Providing the customers with hot line toll free number for easy access to

the service.

4. Providing customers with free door-to-door collection and delivery.5. Re-engineered/ customized service for varying customers according to the need

with logical and efficient promotional strategies i.e. Discounts and offers on long-term

and bulk order for the service.

6. Free Wash Again policy.

7. Replacement policy-if old 30% of the price and new 100% replacement.

7.8 Promotional and Advertising expenses

Since neat and clean has already made good customer base with deals alreadynegotiated with focal persons of one 3 star hotel, 9 mini hotels and Chang Ji Ji colony,

the expenses on promotional and advertising all less than necessary however

investment on such field has its one merit therefore


14/32


14

7.9 PRICE ESTIMATION

Product/Servic

e Name

Market

Price 1

Market

Price 2 Market Price 3Market Price 4

TotalAverage

Price=Total/n

Laundry LaundryDry

cleanLaundry Laundry Dry clean Laundry Dry clean Laundry Dry clean

Kira Full 50 50 150 50 60 180 210 330 52.5 165

Kira Half 40 - - 45 50 150 135 150 45 150

Wonju/Tego 35 - 60 40 35 50 110 110 36.7 55

Rachu 25 - - 40 50 100 115 100 38.3 55

Gho 50 - 250 100 60 180 210 430 70 215

Lagay 15 - - - 10 20 25 20 12.5

Tego (gents) 25 - - - 35 50 60 50 30 50

Kabney 30 - - 40 75 150 145 150 48.3 150

Over coat/

Jacket- - 250 100 120 240 220 490 110 245

Shawal 30 - 60 - 40 80 70 140 35 70

Sweater 30 60 90 35 60 120 185 210 46.3 105

T-Shirt 25 15 25 50 65 50 22 50

Track Suit 40 70 140 110 140 55 140

Jeans pants 35 40 80 75 80 37.5 80

Pajama/Night

dress60 25 50 85 50 42.5 50

Saree 60 100 60 180 120 280 60 140

Salwar

Kameez60 150 70 140 130 290 65 145

Shoes 40 100 200 140 200 70 200

Bath towel 70 20 40 90 40 45 40

Blanket

Medium200 200 150 100 200 650 200 162.5 200

Sleeping Bag 150 200 180 250 530 250 177 250

Bed sheet 30 40 30 30 60 90 100 30 50

Pillow cover 15 30 10 20 25 50 12.5 25

Quilt cover 80 40 40 80 80 160 40 80

Curtain (Light) 100 30 30 60 160 60 53.3 60

Carpet, Sofa

cover and car

seat cover.

350 600 300 250 500 900 1100 300 550


15/32


15

7.10 PRICE SCHEDULE FOR NEAT AND CLEAN

STUDENT PACKAGE (BOYS)

sl.no name of product laundry price dry cleaning price pressing only/-

1 gho 60 180 302 tego 35 50 15

3 stocking 20 40

4 shoe or jeans 100

5 bag 50 100

6 boxer 15 30 15

7 t-shirt 25 50 10

8 kabney 75 150 30

9 handkerchief 5

10 track suit 70 140 35

total 455 740 135

DISCOUNT (15%)!!! 68 74 14NEW RATE 340 749 119

GIRLS


1 kira 60 180 30

2 tego/wongchu 35 50 15

3 stocking 20 40

4 shoe or jeans 100 200

5 bag 50 100

6 boxer 15 30 15

7 t-shirt 25 50 10

8 rachu 50 100 259 handkerchief 5

10 soft toy(medium size) 50 100

11 track suit 70 140 35

total 480 990 130

DISCOUNT 15%!!! 72 149 20

NEW RATE 408 690 99

hotel/home

sl.no name of product laundry price dry cleaning price pressing only-

1 bath towel 20 40

2 bed sheet(single) 20 40 103 bed sheet(double) 30 60 15

4 bed cover(single) 30 60 15

5 bed cover(double) 40 80 20

6blanket/duvet/quilt

cover(single) 20 40

7

blanket/duvet/quilt

cover(double) 30 60


16/32


16

10 curtains(heavy) 50 100 25

11 curtains(light) 30 60 15

12

carpets(sofa/car seat

cover per set) 500

13 carpets(domche dhen)6*4 800

14 pillow cover 10 20 515 seat cover 50 100

16 table cloth 15 30 7

1645 690 112

gents


1 cap/t-shirt 25 0

2 cardigan/sweater 60 120 30

3 coat 120 240 45

4 track suit 70 140 35

5 sneaker 100 0 0

6 Night dress/gown 60 120 257 gho 60 120 30

8 kabney 75 150 30

9 tego 30 60 15

10 socks 10 20 0

11 undergarments 10 20 0

12 total 620 990 210

DISCOUNT 15%!!! 93 148.5 31.5

NEW RATE 527 841.5 178.5

ladies

sl.no name of product laundry price dry cleaning price pressing only-1 sweater 60 100 30

2 coat 100 200 45

3 cap 25 50 0

4 track suit 70 140 35

5 sneaker 100 200 0

6 Night dress/gown 60 120 25

7 skirt 40 90 20

8 short 20 50 10

9 kira 50 180 25

10 rachu 50 100 25

11 wonju/tego 35 55 1512 Blouse/Brassiere 25 50 0

635 1335 230

95.25 200.25 34.5

540 1135 196


17/32


17

7.11 PRICING STRATEGY

The Neat and Clean unlike its existing competitors will offer a re-

engineered service package for the services availed by its customers. The service package

comes in 6 new laundry and dry cleaning list. The package has been designed after a thorough

analysis on buying pattern of the customers which is influenced by the life style and purchasingpower of people residing in Thimphu town.

The packages are student package (boys and girls each), gents,

ladies, hotel/home and trekking package, which includes all the clothes being washed by the

existing competitors.

Clubbing related clothing under a particular package will allow the

customers to have discount on bulk purchase/service availed. It will also be convenient for

them to avail the service since the packages are designed for serving the clothing needs of the

customers for different

The package has also so much to offer to Neat and Clean. It for

mostly will differentiate itself from rest of the competitors, gaining customer attention with

addition to lump sum cash inflow through increase frequency of sales mainly drawn by the

discounting of service rendered and customized servicing according to the buying pattern of the

customers.

For each package used the customers are offered 15% discount on

laundering and dry cleaning which comes with free pressing service if either of laundering or

dry cleaning service is availed. However for those customers availing only pressing service willhave to pay for it, the prices of which are listed in the Price Schedule of the business plan.

For the flexibility of the packages the customers can avail the service

at same discount rate if they wash an item from the package which must amount to same price.

For example in student package (boys) the laundry charge amounts to Nu.340. An item say, gho

is priced at Nu.60 therefore if a student wash 7 ghos it will be charged Nu.340 only against

original pricing of Nu.420/-, this will ensure the package is used extensively which would

certainly benefit both the parties.

Customers who would like to wash clothes by drifting away from

package have to pay for individual items as it is. This is done to encourage the customers to use

the pack


18/32


18

8. SALES ESTIMATION

JUSTIFICATION:

The sales in the first year of its operation can be attributed to the potential purchasing

power of the newly created market, ideal location and the buying pattern of the niche market.

TARGET

MARKET

TOTAL

POPULATION

PROJECTED SHARE OF MARKET

2012 2013 2014 2015 2016

HOTELS 30 9 10 13 13 17

RESTAURANT 50 3 5 7 7 10

C.C 2000 200 250 350

CENTRE

POINT

1500 150 200 250 250 350

RICB 2000 200 250 250 250 300

INDIVIDULS 2000 200 250 300 300 350

7580 762 965 820 820 1377

Note: The projected share of market mentioned above is from the findings of the

market survey carried out by the consultant who is indeed from laser sharp observation over

the share of market and the large network of customer base established by the promoter.

SERVICE

NAME/PACKAGE

LAUNDRY

PRICE

qunty.

Sales

per

month

Sales

per

month

DRYCLEAN

PRICE

qunty.

Sales

per

month

Sales

per

month

total sales

per year

2013(5%) 2014(4%) 2015(3%) 2016(3%)

Hotels/home 1645 45 74025 690 9 6210 802350 842468 876166 893690 920500

Gents 527 20 10540 842 9 7574 181135 190192 197799 201755 207808

Ladies 540 10 5398 1135 9 10213 156103 163908 170464 173873 179089

Boys 340 10 3400 749 4 2996 63960 67158 69844 71241 73378

Girls 408 10 4080 690 3 2070 61500 64575 67158 68501 70556

97443 29062 1265048 1328300 1381432 1409061 1451332


19/32


19

8.1 ROI FROM DIFFERENT TARGET MARKET

MARKET SEGMENT ROI (in Nu.) % OF ROI

HOTELS 315000 24.7059

RESTAURANT 100000 7.84314

C.C 400000 31.3725

CENTRE POINT 80000 6.27451

RICB 100000 7.84314

INDIVIDULS 280000 21.9608

TOTAL 1275000 100%

24.70588235

7.843137255

31.37254902

6.274509804

7.843137255

21.96078431

% OF ROI

HOTELS

RESTAURANT

C.C

CENTRE POINT

RICB

INDIVIDULS


20/32


20

8.2 BUYING PATTERN:

1. Hotels/Restaurant: The hotels and restaurant as mentioned in the Niche Market

is the only customer base on contract basis which avails the Hotel/home package on regular

interval. The market potentiality of the hotels are as below :

HOTEL ITEMS

Name of the Hotel

HOTEL

RAVEN

INN

HOTEL

GALING

KHANG

HOTEL

R.PENJO

R

HOTEL

DESTIN

Y

HOTEL

ZHIZAN

G

HOTEL

ZIMCH

U

HOTEL

BHUTAN

SUITE

Bath towel 114 214 47 51 39 89 245

Bed sheet (single) 101 136 76 60 52 0 175

Bed sheet

(Double) 10 52 82 0 0 38 64

Blanket/duvet/qu

ilt cover (single) 4 0 0 0 0 22 21

Blanket/duvet/qu

ilt (double) 3 0 0 0 0 0 11

Pillow cover 117 269 93 41 34 69 1

Table cloth 61 19 0 2 12 0 0SOURCE: BILL BOOK RECORD (SPOTLESS)


21/32


21

OTHER MARKETS

For other markets that include the following, all the packages designed as new

service list are availed in the following ratio based on the life style which has extensivelydetermined the buying pattern of the customers. The findings are based on in-depth research

and market survey carried out which includes secondary information such as past 9 months bill

book of an existing competitor and observation over obvious facts about the society dwelling

in ThimphuCity.;

1. RICB Colony: As per the findings of the market survey, it is estimated that Neat

and Clean will earn Nu. 10000 per month from this share of market, it has projected to

capitalize 200 individuals from this market. The amount is generated by rendering different

service packages in the above mentioned ratio. Within a package, of the amount is earned

from laundry and from dry clean. Therefore, 200 individuals can be divided in the above

mentioned ratio.

PACKAGEDUSED:

laundryprice

units

sold peryear amount

dry

cleanprice

unitssold amount

totalamount

Boys 340 21 7140 749 3 2247 9387

Girls 408 18 7500 690 3 2070 9570

Ladies 540 28 15000 1135 4 5000 20000

Gents 527 42 22134 841 9 7569 29703

Hotel/Home 1645 15 24675 690 10 6900 31575

124 76449 29 23786 100235

2.

Chang Ji JiChang Ji Ji colony which has total estimated population of 2000 mostly occupied

by school students and PPP (Purchasing Power of People) being high, influenced by life

style has market to earn Nu. 400000 by the end of first financial year, the ratio of service

rendered is as mention here above. Within it of frequency for wash is for laundry and

for dry clean.

Student package(boys):(girls):Ladies:Gents:Hotel/Home

1 :1 : 2: 3 : 3


22/32


22

PACKAGEDUSED: LAUNDRYPRICE

UNITS

SOLD

PERYEAR AMOUNT

DRY

CLEANPRICE UNITSSOLD AMOUNT TOTALAMOUNT

Boys 340 88 30000 749 13 10000 40000

Girls 408 74 30000 690 14 10000 40000

Ladies 540 111 60000 1135 18 20000 80000

Gents 527 171 90000 841 36 30000 120000

Hotel/Home 1645 55 90000 690 43 30000 120000

498 300000 125 100000 400000

3. CENTRE POINT:

Centre Point is located in the heart of the City, which is mainly occupied by high-

end hospitality industry along with good number of potential individual customers and

seasonal tourist orders. The percentage of share of market in the first year out of total

population of 2000 has targeted at 150 numbers, the details of service rendered to this

share of market is as follows:

PACKAGED

USED:

LAUNDRY

PRICE

UNITS

SOLD PER

YEAR AMOUNT

DRY

CLEAN

PRICE

UNITS

SOLD AMOUNT

TOTAL

AMOUNT

Hotel/Home 1645 35 57575 690 33 22770 80345

Note: The location as mentioned above is mainly occupied by commercial building such

as hotels therefore the package service availed is the hotel/home, which makes use of the

service every 3 times a month.


23/32


23

4. INDIVIDUALS:

The individuals refers to the customers dwelling in and around the business

premises which has total population of 2000 and the target market for the initial year is

200, the services availed for the different packages are in the ration mentioned above

whereby of the total service availed is for laundry and for dry clean.

PACKAGED

USED:

LAUNDRY

PRICE

UNITS

SOLD PER

YEAR AMOUNT

DRY

CLEAN

PRICE

UNITS

SOLD AMOUNT

TOTAL

AMOUNT

Boys 340 62 21000 749 9 7000 28000

Girls 408 51 21000 690 10 7000 28000

Ladies 540 78 42000 1134.75 12 14000 56000

Gents 527 120 63000 841 25 21000 84000

Hotel/Home 1645 38 63000 690 30 21000 84000

TOTAL 349 210000 87 70000 280000


24/32


24

9. FINANCIAL COSTINGS

9.1 TOTAL PROJECT COST

PARTICULARS AMOUNT

CAPITAL EXPENDITURE 497000

ADMINSRATION COSTING 199000

INVENTORY COSTING 243000

MARKETING COSTING 21200

MAN POWER COSTING 160000

TOTAL 1120200

GRAPHIC REPRESENTATION OF NET PROFIT AND LOSS A/C PROJECTION

397109

445025474405 483022

501930

0

100000

200000

300000

400000

500000

600000

2012 2013 2014 2015 2016

AmountinNu.

YEAR

NET INCOME PROJECTION FOR 5 YEARS

Net Income


25/32


25

9.2 CAPITAL COSTING (WITH DEPRECIATED END VALUES OF THE ASSETS

OVER 5 YEARS)

SL.N ITEMS PER

UNIT

PRICE

TOTAL

UNITS

AMOUNT 15%

Dep.

2012 2013 2014 2015 20

1 washing

machine

200000 1 200000 30000 170000 140000 110000 80000 500

2 dryer 200000 1 200000 30000 170000 140000 110000 80000 500

4 ironing 15000 1 15000 2250 12750 10500 8250 6000 37

5 water tank 2000 1 2000 300 1700 1400 1100 800 5

6 second

hand van

80000 1 80000 12000 68000 56000 44000 32000 200

TOTAL 497000 74550 422450 347900 273350 198800 1242

The capital amount is depreciated annually @ 15% based on SLM, the prices are Indian made and the catalogue is taken from

www.stefab.com

9.3 ADMINISTRATIVE COSITNGS

SL.

NO.

PARTIUCLARS MONTHLY

COST

2012 2013 2014 2015 20

1 Rent(main office) 10000 100000 100000 100000 100000 1000

2 Electricity 5000 50000 50000 50000 50000 500

3 Stationeries 500 5000 5000 5000 5000 50

4 Repair and

maintenance

20000 20000 20000 20000 200

5 Water bill 700 7000 7000 7000 7000 70

6 Telephone bill 1000 10000 10000 10000 10000 100

7 Renewal of license 750 -

8 Bank charges 500 5000 5000 5000 5000 50

9 BCCI

MEMEBERSHIP

FEE

200 2000 2000 2000 2000 20

TOTAL 17900 199000 199000 199000 199000 1997Note: The charges for Collection Point in the two strategically located areas in RICB and Chang Ji Ji Colony

which must be included in administrative costing has been excluded since Neat and Clean is on a deal with the shops in

which the collection Points will be based, will charge on 5% of the gross sales on monthly basis as rental commission or

Nu.10,000 whichever is lower.


26/32


26

9.4 INVENTORY COSTING

SL.NO PARTICULARS MONTHLY

SUPPLY

PER

UNIT

COST

MONTHLY

COST(15

days)

2012 2013(1%) 2014(2%) 2015(4%) 2016(3

1 Surf(one

bucket)

15 533 8000 80000 80800 82416 85713 882

2 coaster soder

(40kg)

2 1200 2400 24000 24800 25296 26308 270

3 Bleaching

powder(per

can)

30 40 1200 12000 12800 13056 13578 139

4 Fuel 10 7500 75000 75800 77316 80409 828

5 Dryer oil (130

per liter.)

40 5200 52000 52800 53856 56010 576

TOTAL 243000 247000 251940 262018 2698

Note: The inventory costing has been kept at a marginal so that there is no blocking up of capital due to over

estimation of inventories nor lesser than required amount so that stock-in of inventories is ensured at all times. Since

the inventories are available in and around the business premises Neat and Clean will followJIT(Just In Time) method

for management of inventories which would obviously reduce cost since neither transportation nor store room will be

in use in large scale.

9.5 MANPOWER COSTING

SL.NO Particulars monthly

salary

2012 2013(5%) 2014(4%) 2015(3%) 2016(3%)

1 Accountant

and driver

0 0 0 0 0 0

2 2 sales

assistant (for

Collection

Point)

7000 70000 73500 76440 78733 81095

3 Ironing 4500 45000 47250 49140 50614 52133

4 Machine

operator

4500 45000 47250 49140 50614 52133

Total 160000 168000 174720 179962 185360


27/32


27

Note: Neat and Clean will employee 2 sales assistant at two Collection Point located in Chang Ji Ji

and RICB Colony. 2 other workers will be deployed in ground operation; each of them will be involved in

operating the laundry and dry cleaner. All the workers will be given a monthly salary of Nu.4500. The

promoter will be assuming the work of accountant and driver during collection of orders and door-to-door

delivery. The promoter will retain 5% of the profit for personal use. All other matters dealing with

employees shall be dealt according to the Labor Act of Kingdom of Bhutan.

9.6 MARKETING COSTING

SL.NO PARTICULARS 2012 2013 2014 2015 2016

1 SIGN BOARD 5000 0 0 0 2000

2 LOGO 5000 0 0

3 BILL BOOK 1200 2000 2000 2000 2000

4 ADVERTISEMENT 10000 2000 1500 1500 1500

Total 21200 4000 3500 3500 5500

Note: Neat and Clean will maintain an attention grapping sign board with flash

lights which will be designed with the logo of the business embedded on the signboard. It

will advertise the business in local T.V channel as well as BBS. It will also maintain a bill

book to ensure accurate and transparent book-keeping practice for the benefit of the

proprietor in analyzing the business which would result in exploring innovative ideas to

be strategically implemented in improving the operation of the business at the same time

will be helpful in payment of (BIT) Business Income Tax.


28/32


28

10. FINANCIAL REPORT

10.1 PROFIT AND LOSS ACCOUNT PROJECETION FOR THE YEAR ENDING 2012-

2016

Particulars 2012 2013 2014 2015 2016

Total

sales/revenue

1265048 1328300 1381432 1409061 1451332

LESS:

Depreciation 74550 74550 74550 74550 74550

Inventory costing 243000 247000 251940 262017.6 269878.13

Marketing costing 21200 4000 3500 3500 5500

Administrative

costing

199000 199000 199000 199000 199000

Manpower costing 160000 168000 174720 179961.6 185360.45

TOTAL COST 697750 692550 703710 719029 734289

Gross income(A-B) 567298 635750 677722 690032 717043

Less (BIT@30%) 170189 190725 203317 207010 215113

Net income 397109 445025 474405 483022 501930

10.2 BREAK EVEN ANALYSISYEAR BEP

2012 697750

2013 692550

2014 703710

2015 719029

2016 734289

The Break Even Point for Neat and Clean are as mentioned here above. The BEP iscalculated by adding all the costing including the depreciation amount. Neat and Clean must

earn at least the mentioned amount so that it is in the state where there is just enough money

to cover the expenditure. Neat and Clean must endeavor to earn beyond the Point to sustain

in the industry to repay the loan and to expand the business.


29/32


29

10.3 PROJECTED CASHFLOW STATEMENT AS ON DEC 30, 2012-2016

Particulars 2011 2012 2013 2014 2015

CASH INFLOW

Cash in Hand 0 839528 1090663 1383769 2073801

Loan received

from the

Foundation

1000000 0 0 0 0

Total sales 1265048 1328300 1381432 1409061 1451332

Total(A) 2265048 2167828 2472095 2792830 3525133

CASH OUTFLOW

LESS:

Total capital

expenditure

497000

Total Cost 697750 692550 703710 719029 734289

Loan

Repayment

238095 357143 404762 0 0

Total(B) 1432845 1049693 1108472 719029 734289

Net Cash

flow(A-B)

832202 1118135 1363623 2073801 2790844


30/32


30

10.4 PROJECTED STATEMENT OF BALANCE SHEET AS ON DEC 30, 2012-

2016

Particulars 2012 2013 2014 2015 2016Assets

Capital items 422450 347900 273350 198800 124250

Cash in hand 839528 1090663 1383769 2073801 2790844

Total 1261978 1438563 1657119 2272601 2915094

Liabilities

Loan 761905 404762 0 0 0

Profit transferred from

P & L A/C397109 445025 474405 483022 501930

Balancing figure 102965 588776 1182714 1789578 2413163

Total 1261978 1438563 1657119 2272601 2915094


31/32


31

11. AMORTIZATION OF LOAN

NO. OF

INSTALLMENTS

PRINCIPAL

DEDUCTION

BALANCE

AMOUNT

1 29761.9 970238.1

2 29761.9 940476.2

3 29761.9 910714.3

4 29761.9 880952.4

5 29761.9 851190.5

6 29761.9 821428.6

7 29761.9 791666.7

8 29761.9 761904.8

238095.2 761904.8 LOAN AMORTIZED AFTER GESTATION PERIOD OF4 MONTHS

9 29761.9 732142.9

10 29761.9 702381

11 29761.9 672619.1

12 29761.9 642857.2

13 29761.9 613095.3

14 29761.9 583333.4

15 29761.9 553571.5

16 29761.9 523809.6

17 29761.9 494047.7

18 29761.9 464285.819 29761.9 434523.9

20 29761.9 404762

357142.8 404762 LOAN AMORTIZED BY THE END OF 2013

21 33730.17 371031.8

22 33730.17 337301.7

23 33730.17 303571.5

24 33730.17 269841.3

25 33730.17 236111.2

26 33730.17 202381

27 33730.17 168650.8

28 33730.17 134920.629 33730.17 101190.5

30 33730.17 67460.3

31 33730.17 33730.13

32 33730.17 0

404762.04 LOAN AMORTIZED BY THE END OF 2014


32/32


12. CONCLUSION

The proposed business plan is full fledge, with in-depth market survey

conducted on the buying pattern and frequency of service availed by the customers in

the city. As per the findings there is huge market for the service rendered by Neat and

Clean. This is so because of the life style of the people dwelling in Thimphu, the lack inservice delivery by the existing competitors and more so because of re-engineered price

schedule which comes in package which is customized according to the life style of the

people.

The costing which includes administration, marketing, man power and inventory

costing are kept at an average so, that there is no blocking up of capital due to over

estimation of the costing or under estimation of the costing which would interrupt the

daily operation of the business.

The net profit for Neat and Clean is projected @ 34% over total sales in 2016,

at this rate of ROI Neat and Clean will be in position to repay the loan (principal amount)

in 33.6 periods or 2 years and 8 months, with yearly installment of Nu.238095 in the first

year to Nu. 357143 in the second year and Nu.404762 by the end of 3rd year of the

operation of the business, with this Neat and Clean obligation to Loden Foundation will

be duly met.

Neat and Clean will thus, be a viable business operation, rendering the laundry

service need to all those customers in need of the service rendered by Neat and Clean.

It will not only provide an opportunity to a want-to-be-entrepreneur like the promoter to

materialize the dream of owning a business but also provide gainful employment to

those who are deployed in the operation of the business.

neat $ clean

Documents