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A large selection of women fashion shoes available now at The Ladies' Shoes shop.

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Page 2: The Ladies' Shoes Co.,Ltd

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Preface

This Project is a part of 1203302 Project Feasibility Study and Evaluation

Course in the second semester of 2010. In this project is studying the feasibility of

fashion footwear business in Chiang Rai, which including of background and reason of

business, situation of industry, competition analysis, marketing feasibility, the technical

process, the financial feasibility, and risk analysis in fashion footwear business.

This project is useful to everyone who interested to get knowledge and

information about fashion footwear business before makes decision to investment. It

include operation process covering all of the pre-operating cost of fashion footwear

business,

We are hopeful that our project will provide more benefits to people who

interesting in business. If there is any error in this project, we apologize at this

opportunity.

Group Member

Miss Araya Rojjanatranon

Miss Wichanut Rungroat

Miss A-porn Nantanoi

Miss Pimpilai Chaiyatep

Miss Wansiri Wonglaongpakdee

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Table of Contents

Preface ............................................................................................................................... i

Table of Content ............................................................................................................... ii

Chapter 1 Introduction ................................................................................................... 1 1.1 Background and Significant of the project .............................................................. 2

1.2 Project Objective ..................................................................................................... 5

1.3 Benefits of Project ................................................................................................... 5

1.4 Activities / Time frame ............................................................................................ 6

Chapter 2 Industry Profile.............................................................................................. 7 2.1 Nature of industry .................................................................................................... 8

2.2 Situation of industry .............................................................................................. 15

2.3 Product and Service ............................................................................................... 18

2.3.1 Product ........................................................................................................ 18

2.3.2 Product sample ........................................................................................... 19

2.3.3 Service ........................................................................................................ 23

2.4 Vision..................................................................................................................... 23

2.5 Mission .................................................................................................................. 24

2.6 Business strategy ................................................................................................... 24

2.6.1 Corporate level ........................................................................................... 24

2.6.2 Business level ............................................................................................. 24

2.6.3 Functional level .......................................................................................... 24

Chapter 3 Market feasibility Study ............................................................................. 27

3.1 Marketing Analysis................................................................................................ 28

3.1.1 General Environment Analysis ................................................................... 28

3.1.2 Competition analysis (3C Analysis) .......................................................... 32

3.2 STP Analysis ......................................................................................................... 39

3.2.1 Segmentation .............................................................................................. 40

3.2.2 Target market .............................................................................................. 40

3.2.3 Positioning .................................................................................................. 40

3.3 Marketing Mix Strategy......................................................................................... 41

3.3.1 Product ....................................................................................................... 41

3.3.2 Price ............................................................................................................ 43

3.3.3 Place............................................................................................................ 44

3.3.4 Promotion ................................................................................................... 45

3.4 Sale Forecast/Profit Estimation ............................................................................. 47

3.5 Marketing Expense ................................................................................................ 68

3.6 Conclusion ............................................................................................................. 71

Chapter 4 Technical feasibility Study .......................................................................... 72

4.1 Production / Operation Analysis............................................................................ 73

4.1.1 Product Characteristic................................................................................. 73

4.1.2 Production / Service Process ...................................................................... 79

4.1.3 Location and Layout ................................................................................... 80

4.1.4 Tool / Equipment ........................................................................................ 88

4.1.5 Logistic Management ................................................................................. 94

4.1.6 Facility Management .................................................................................. 96

4.2 Cost of Investment .................................................................................................. 97

4.2.1 Pre-Operating cost ...................................................................................... 97

4.2.2 Investment cost ......................................................................................... 102

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4.2.3 Equipments and Tools .............................................................................. 103

4.2.4 Depreciation.............................................................................................. 104

4.3 Management Analysis .......................................................................................... 109

4.3.1 Organization Management ....................................................................... 110

4.3.2 Organization Chart ................................................................................... 113

4.3.3 Administration Cost .................................................................................. 114

4.4 Conclusion ............................................................................................................ 124

Chapter 5 Financial Analysis...................................................................................... 125 5.1 Income Statement ................................................................................................. 126

5.2 Statement of Cash Flow ........................................................................................ 131

5.3 Balance sheet ........................................................................................................ 141

Chapter 6 Risk Management ...................................................................................... 147

6.1External Risk ......................................................................................................... 148

6.2Internal Risk .......................................................................................................... 150

Chapter 7 Summary .................................................................................................... 157 7.1 Background and Reason ....................................................................................... 158

7.2 Product and Service .............................................................................................. 158

7.3 Marketing.............................................................................................................. 159

7.4 Production Process ............................................................................................... 159

7.5 Management Analysis .......................................................................................... 160

7.6 Risk Management ................................................................................................. 160

Reference ...................................................................................................................... 161

Appendix....................................................................................................................... 163

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Chapter 1 Introduction

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Chapter 1

Introduction

1.1. Background and Significance of the project

A shoe is an item of footwear intended to protect and comfort the human foot

while doing various activities. Shoes are also used as an item of decoration. The design

of shoes has varied enormously through time and from culture to culture, with

appearance originally being tied to function. Additionally fashion has often dictated

many design elements, such as whether shoes have very high heels or flat ones.

Contemporary footwear varies widely in style, complexity and cost. Basic sandals may

consist of only a thin sole and simple strap. High fashion shoes may be made of very

expensive materials in complex construction and sell for thousands of dollars a pair.

Other shoes are for very specific purposes, such as boots specially designed for

mountaineering or skiing.

Shoes have traditionally been made from leather, wood or canvas, but are

increasingly made from rubber, plastics, and other petrochemical-derived materials.

Until recent years, shoes were not worn by most of the world's population—

largely because they could not afford them. Only with the advent of mass production,

making shoes available very cheaply, has shoe-wearing become predominant. 1

Shoes are the device used to wear for walking. Its benefit is to prevent our foot

from contacting with various sharp objects. However, in view of other people who love

fashion, shoes are important accessories indispensable to show the identity of their

wearer especially the girls who love new fashion. They always find and purchase the

new launching shoes by the reason that they are part of the good disciples who follow

1

http://en.wikipedia.org/wiki/Shoes

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the fashion trend. Therefore, we are not surprising that the sales of shoes rise which are

opposed to the economic that is on the way down.

Nowadays, we can see that fashion has a great influence on Thai people

whether teenage, school age, and working age. They can dress their up follow to

fashion. For example, fashion the winter, including scarves, leggings, and stockings

which they are able to wear these accessories to do their duty. They can get both the

warmth and also being a modern people who are not out of fashion as well. Footwear is

one contained in costume which is non-volatile fashion as clothing. A pair of shoes can

be worn to many events, in many places whether put to work or go to any party. From

this widespread acceptance, our business would like to be the shoes‘ shop which

provides a variety of shoes. We would like to offer a lot of shoes‘ styles that come from

both Thai and overseas. The shops have two branches. The locations for our business

will be at in front of Mae Fah Luang University, and Chiang Rai Rajabhat University,

Chiang Rai.

Chiang Rai is part of Economic Quadrangle Cooperation. The general trading

conditions in Chiang Rai, it continues to grow have seen from statistics of the limited

partnership and company limited that were registered especially construction business,

trading, import - export of agricultural raw materials. And increase of hotel business

raising the growth of Chiang Rai economy and consumer spending.2 Private investment;

the construction in October 2009 continues to accelerate from the same month at

previous year to 160.8% of residential construction based on the permitted area in the

municipality. The investment in manufacturing was also increase, as a result of

domestic economic recovery, investors are attracted to invest more. The important

indicators are number of registered new plant from 3 plants in the same month last year

increased to 9 plants. The number of new business registered remained relatively flat

from the same month last year with a number of 26 cases.3 There are three famous

universities in Chiang Rai such as Chiang Rai Rajabhat University, Mae Fah Luang

2

http://pcoc.moc.go.th/wappPCOC/views/dfactsheet.aspx?pv=57 3

http://www.klangcri.com/team/team3/data/econemy/2553/1.%20Oct%202552.pdf

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University, and Rajamangala University of Technology Lanna Chiang Rai. We focus on

two universities in Chiang Rai which are Chiang Rai Rajabhat University and Mae Fah

Luang University because we see that these universities have the amount of female

populations more than others in Chiang Rai and the area of universities are not far from

town that allow people to see easily.

Mae Fah Luang University where a lot of students who came from different

parts of Thailand. Mae Fah Luang University is the latest university in Chiang Rai

which is evolving. The university emphasis on English teaching, and there are a lot of

both Thai and foreign students. Chiang Rai Rajabhat University where is the oldest

university in Chiang Rai and consists of many students and staffs. It also has the most of

foreign students in the North. We need to open two branches because we would like to

distribute our products to the customers and to possess the market share as much as

possible.

Nowadays, shoes‘ store in front of Mae Fah Luang University and Chiang Rai

Rajabhat University has not much. In these areas is not much progress yet, having few

and small shops that not enough to encounter with a lot of students, so most students

have to go into town to purchase their clothes, shoes, and other accessories. In this case

that the students need to go into town to buy fashion shoes which use of over 10 km. is

waste the cost of money and time and especially it may cause danger to students.

Accordingly, we would like to offer them the better way adding convenience and cost

saving by opening a fashion shoes shop with a large collection of good quality and

cheap price shoes for students in major. In addition, this benefit also causes to other

people such as officers, and other occupations who love to keep up with fashion.

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1.2. Project Objective

• To measure the possibility of a fashion footwear business project

• To measure the possibility of fashion footwear market

• To measure the possibility of financial statement

• To measure the possibility of human resource management

• To analyze net income for basic business

• To calculate the return on business

• To calculate the percent of market share

1.3. Benefits of Project

• Learning the opportunity of new business

• Learning the needs of the market that change all the time

• Learning how to create or improve marketing plan

• Learning the risk factors of this business

• Learning the method or procedure of investment‘s planning

• Learning the financial management and how to manage the financial

reconciliation

• Learning how to solve problems that occur during the project.

• Learning how to run the business and setting the work force

• Learning the feasibility of this business

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1.4. Activities / Time Frame

November December

January

February

Activities Week Week Week Week

1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4

1. Topic submission

2. Introduction

- Define background of project

3. Study the industry profile

- Product characteristic

4. Analyze the market feasibility

- Market analysis

5. Study technical feasibility

- Analyze production and operation

6. Analyze the financial management

of our business

- Financial management generating

and analysis

7. Project advertising

8. Study and manage the risk of our

business

9. Writing and analyze the report

10. Presentation

11. Conclusion the feasibility of the

business

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Chapter 2 Industry Profile

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Chapter 2

Industry Profile

2.1 Nature of Industry

There is much evidence that a foot covering was one of the first things made by

our primitive ancestors. Necessity compelled them to invent some method of protecting

their feet from the jagged rocks, burning

sands, and rugged terrain over which

they ranged in pursuit of food and

shelter.The history of human

development shows that the importance

of protecting the foot was early

recognized. Records of the Egyptians,

the Chinese and other early civilizations

all contain references to shoes. The shoe is repeatedly mentioned in the Bible and the

Hebrews used it in several instances with a legal significance, notably in binding a

bargain. Shoes of one sort or another are rich in legend and figure conspicuously in the

folklore of different races. The shoe, even

up to the present time, continues to figure

in those stories, which have come down to

us. The stories of the wonderful Seven

League Boots, Mercury's Winged Sandals,

Puss in Boots, Cinderella, and others, all

existed in some ancient and often nearly

forgotten tongue, but are still well known

to all children. The custom of throwing the

shoe after the newly wedded couple is but one of the many instances in which the shoe,

when used according to formula, was supposed to bring luck.

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In its first form the shoe was

just a simple piece of plaited grass

or rawhide which was strapped to

the feet. Among the relics of early

Egyptians are some sandals made

from plaited papyrus leaves,

beautifully and artistically wrought.

Records show that sandalmaking had become a well-recognized art early in the history

of that country.

The sandal still is the most generally worn

type of footwear in many warm countries. In form

and ornamentation it reflects the environment in

which it was worn, together with the artistic tastes of

the peoples. In some countries the sandal continues to be the same simple kind worn

since the dawn of history, while in others the multiple form of the straps and beautiful

decorative work reflect the artistry, progress and

prosperity of the wearers.

The Japanese, long a sandal wearing

people indicated the social status of the wearer

by making distinctive sandals for the Imperial

Household, merchants and actors, in fact, for the

whole range of vocations and professions.

The Greeks emphasized design

and beauty, while the Romans devised a

military type of sandal that enabled

their legions to travel on foot

throughout the then known world. In

the more luxurious days of the late

Empire the sandals were often

beautifully wrought with ornaments of

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gold and precious stones. The moccasin is the foot protection of cold countries. The

puckered seam which outlines the forepart of the moccasin is all that remains of the

puckering string once gathered and tied about the ankle. This peculiar seam still appears

in the footwear of people in every cold county. The moccasin of the North American

Indian, the Eskimo, and the Laplander all have it. The shoe has always had an important

place in costume. Until recent years, many shoes were made to be worn only on

occasions of great ceremony. Some of these were very lavish in design and ornament,

lending importance and distinction

to the official dress of proud

wearers.

Through all this

development, comparatively little

attention was devoted to fitting

qualities or comfort. When the

medieval guilds controlled

craftsmanship in Europe, perfection in workmanship and extravagance in style seems to

have been sought in shoes rather than foot comfort and protection.

Among the more conspicuous oddities of style in this period was the peaked

shoe or Crackow, with a toe so long that it made walking difficult if not impossible and

the passage of laws to prohibit its wearing was necessary before it was discontinued. It

was followed by the Duckbill shoe in Elizabethan times. Laws were enacted limiting its

maximum width to 51/2 inches. These footwear oddities in turn were followed by a

succession of fantastic

creations and shapes.

As late as 1850 most

shoes were made on

absolutely straight lasts,

there being no difference

between the right and

the left shoe. Breaking in

a new pair of shoes was not easy. There were but two widths to a size; a basic last was

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used to produce what was known as a "slim" shoe. When it was necessary to make a

"fat" or "stout" shoe the shoemaker placed over the cone of the last a pad of leather to

create the additional foot room needed.

Up to 1850 all shoes were made with practically the same hand tools that were

used in Egypt as early as the 14th century B.C. as a part of a sandal maker's equipment.

To the curved awl, the chisel-like knife and the scraper, the shoemakers of the thirty-

three intervening centuries had added only a few simple tools such as the pincers, the

lapstone, the hammer and a variety of rubbing sticks used for finishing edges and heels.

Efforts had been made to develop machinery for shoe production. They had all failed

and it remained for the shoemakers of the United States to create the first successful

machinery for making shoes.

In 1845 the first machine to

find a permanent place in the shoe

industry came into use. It was the

Rolling Machine, which replaced the

lapstone and hammer previously used

by hand shoemakers for pounding sole

leather, a method of increasing wear by

compacting the fibres.

This was followed in 1846 by Elias Howe's invention of the sewing machine.

The success of this major invention seems to have set up a chain reaction of research

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and development that has gone on ever since. Today there are no major operations left

in shoemaking that are not done better

by machinery than formerly by hand.

In 1858, Lyman R.Blake, a

shoemaker, invented a machine for

sewing the soles of shoes to the

uppers.His patents were purchased by

Gordon McKay, who improved upon

Blake's invention. The shoes made on

this machine came to be called "McKays." During the Civil War, many shoemakers

were called into the armies, thereby creating a serious shortage of shoes for both

soldiers and civilians. The introduction of the Mckay was speeded up in an effort to

relieve the shortage.

Even when McKay had perfected the machines,

he found it very difficult to sell them. He was on the point

of giving up since he had spent all the money he could

spare, when he thought of a new plan. He went back to

the shoemakers who had laughed at the idea of making

shoes by machinery, but who needed some means of

increased production. He told them that he would put the machines in their factories, if

they would pay him a small part

of what the machine would save

on each pair.

McKay issued "Royalty

Stamps", representing the

payments made on the machine-

made shoes. This method of

introducing machines became

the accepted practice in the industry. Mention is made of it because it had two important

bearings on the industry. First, shoe manufacturers were able to use machinery without

tying up large sums of money. This meant that, in the event a new shoe style suddenly

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became popular and called for major changes in shoe construction methods and

production equipment, the manufacturer wasn't left with a huge investment in

machinery made obsolete by these changes - nor with the prospect of further investment

for new machines. Second, it developed a type of service which has proven to be of

great value in the shoe and other industries.

This unique service was used in the

shoe industry long before it spread to other

industries. McKay quickly found that in order

to ensure payment for the use of the machines

it was necessary to keep them in operation. A

machine which wasn't working did not earn

any money for Mckay. He therefore made

parts interchangeable and organized and trained a group of experts who could be sent

wherever machines needed replacement of parts or adjustment.

In 1875 a machine for making a different type of shoe was developed. Later known as

the Goodyear Welt Sewing Machine, it was used for making both Welt and Turn shoes.

These machines became successful under the management of Charles Goodyear, Jr., the

son of the famous inventor of the process of vulcanizing rubber. Following McKay's

example, Goodyear's name became associated with the group of machinery which

included the machines for sewing Welt an Turn shoes and a great many auxiliary

machines which were developed for use in connection with them.

Invention as a product of continuous research has progressed at an almost

incredible pace ever since. This has required great sums of money, sometimes more

than a million dollars, to perfect one shoemaking machine, and tireless patience and

effort. Inventors have often mechanized hand operations that seemed impossible for any

machine.

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We have progressed a long way from the lasting pincer, a simple combination of

gripper and lever. For centuries it was the hand shoemaker's only tool for shaping the

shoe around the form on which it is made - aided only by his thumbs and tacks, The

lasting pincer is a good tool and is still occasionally useful; with it a century ago a man

with great effort might form or last a few pair in a long day. Today's automatic toe laster

for Goodyear Welt shoes can last 1.200 pairs in an 8-hour day.4

4

http://www.shoeinfonet.com/about%20shoes/history/history%20your%20shoes/history%20your%20shoes

.htm

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2.2 Situation of Industry

General situation

Footwear and leather is the fashion goods that vary the needs according to

market trends or group of the world‘s leading designers. It is an industry that adding

value to the leather begins with raw leather and cause many downstream industries such

as shoes, bags, leather furniture, pet toys, gloves, belt, watchband, and etc. In addition,

the industry is intensive use of labor and has to rely on export significantly. The

volatility of trading partners' economies will affect operators in the industry.

Manufacturing

In 2010 the shoe and leather factories registered with the Department of

Industrial Works (Last update 21 Jan 2010) about 1,009 plants, employed 106,050

people which divided into shoe industry 467 factories with workers 70,507 people.

In 2010 the index of the shoe and leather industry has changed when compared to the

same period at the previous year, production index of shoe manufacturing decreased

0.7%. Index of shipments increased 2.6% and finished goods inventory index increased

by 44.0%.

Marketing

Exports

As a whole in 2010, exports of footwear and leather goods was expected to

increase from the year 2009 for 10.1%. All products rate are rising such as footwear and

parts, appliances for travel, leather products increased of 1.2, 21.0, and 21.6%

respectively.

In 2010, footwear and parts estimated that the export will increase from the year

2009 1.2%. Increased export products were slippers, leather shoes, other shoes, and

parts of shoes increased 10.1, 41.8, 47.5, and 11.9% but exported sports shoes dropped

down 52.7%. The increased export market (January-October 2010) include Denmark,

France and China increased 22.5, 12.8, and 1.1% respectively.

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Imports

In 2010, shoe is expected to import up to 40.1% from the year 2009.

All imported products are increase such as shoes, sports shoes, leather shoes, shoes

made of rubber or plastic, and others increased by 10.0, 137.2, 15.2 and 16.2%

respectively. Major import markets are China, Indonesia and Vietnam.

Summary and Tendency

Production situation in 2010 compared to 2009 is expected to increase in all

products. Export of footwear, parts, and appliances for travel, and leather products in

2010 is expected to increase from the year 2009 by 1.2, 21.0 and 21.6%, respectively,

resulting from the production base and export of the year 2009 was low. In addition,

major trading partners began to signal economic recovery to more stable making high

consumer confidence in shopping goods. Import of the shoes and bags is expected to

increase 40.1 and 28.3% respectively.

Trends of production and export values of footwear and leather industry in 2011

compared with the year 2010 are expected that footwear industry will be increase but

for the leather products industry will be flat. The next year will be driven by the

expansion of increasing investment. Furthermore, government policies that stimulate

economy, increased orders, increased production capacity, and trends in the domestic

and global economy is expected to be better while the negative factors affecting the

Thai industry come from exchange rate, interest rate, policies, fuel, domestic political

situation, and economic problems of Europe.5

Nowadays, there are many fashion shoes stores in Thailand. This business is

very popular in Thailand because it is easy trade in investment and low cost and capital

budget more than other business. In addition, most of teenagers pay much attention

about dressing, so shoes are certainly important factor that related to it. Currently, Korea

fashion has affected teenagers in Thailand more and more. It makes increasing trade of

5 http://www.ryt9.com/s/oie/1053093

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Korea fashion market for both women and men in the fashion stores at the shopping

mall and other locations.

Consumption behavior of fashion clothing and footwear

For consumers who purchase apparel categories in department stores. Important

issues that affect the decision to buy fashionable clothes and shoes was the most

beautiful forms of modern goods 23.4%, followed by the appropriate to their

personality 18.4%, product quality 15.0%, appropriate price 13.9%, the need to use

9.5%, discount 8.6. %, confidence in the brand 4.5%, convenience of buying 3.6%, get

premium 2.2%, Other 0.6%, and sweepstakes 0.3%.

For consumers who purchase apparel categories in the market. Most consumers

chose to buy fashion clothes, including fashion shoes monthly up to 40.0%, followed by

every three months 16.4%, Others 12.9%, every week and every 2 weeks had the same

frequency of buying of 10.7%, every six months by 6.4%, and yearly 2.9%.

Consumers' attitudes toward fashion. Overall, the comments in each market, the

majority of consumers‘ attitudes toward whether the fashion products, the appropriate in

terms of price, beauty, and durability as well as the location and distribution channels

was the same direction that according to the suitability of the fashion market.6

By consumption behavior, the women buy shoes more than man. Nowadays, the

value of women‘s shoes market is not below one thousand million baht each year.

While fashion shoes have best rate, the market of women‘s fashion shoes has bigger

size than fashion shoes of men. At present, buying rate of women‘s shoes are 60% and

men are 40% only. Therefore, fashion shoes become more popular for business now.7

6

http://shoes4sales.blog.com/2010/10/16/%E0%B8%81%E0%B8%B2%E0%B8%A3%E0%B8%9A%E0%

B8%A3%E0%B8%B4%E0%B9%82%E0%B8%A0%E0%B8%84%E0%B9%80%E0%B8%AA%E0%B8

%B7%E0%B9%89%E0%B8%AD%E0%B8%9C%E0%B9%89%E0%B8%B2%E0%B9%81%E0%B8%9

F%E0%B8%8A%E0%B8%B1%E0%B9%88/

7 http://www.ttisfashionbiz.com/component/content/article/19-fashion-accessories/514-

ciisiosfisisffleather.html

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2.3 Product and Service

2.3.1 Product

Women's shoes range from conservative to sexy, and the right pair of

high heel shoes is one of the most versatile items you can have in your closet.

There are a lot of women‘s shoes in our shop which are divided into

categories based on quality and price. We offer large selections of fashioned

high heel shoes, basic shoes, platform shoes, and etc. which came from the big

stores and market in Bangkok where a fashion city is, such as Jatujak market

(JJ), Platinum, Union mall and also importing the shoes from Korea and Hong

Kong by ordering the mass, through the website.

Figure 2.1 Fashion shoes‘ shop

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2.3.2 Product sample

Shoes’ formats

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Shoes’ formats

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Shoes’ formats

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http://www.wholesale-dress.net/women-s-wedges-c2125

http://www.wholesale-dress.net/women-s-pumps-c2122

Shoes’ formats

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2.3.3 Service

In a good costume, clothing must be corresponding with shoes. The best

selection of shoes not only makes the wearer look good, but also cause good

personality and health as well. The Ladies‘ Shoes, we provide guide service to

all customers by our well-trained employees who have knowledge of fashion

and personality development. The guide service will give advice and customer

care; help customer find their desirable and appropriate shoes. Thus our business

concentrates on this phrase ―when you come in our shop, you can tell your needs

and wants directly. Do not hesitate to tell us.”

Figure 2.2 Guide service by The Ladies‘ Shoes

2.4 Vision

To be the leader of fashion footwear business in Chiang Rai

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2.5 Mission

Giving the best experience and sincerity to our customers by offering our

excellent service, and providing a large selection of good quality products. We will keep

up with the fashion trend and update to our customers immediately. We will provide

and select the best products and service to serve our customers thoroughly.

2.6 Business Strategy

2.6.1 Corporate level

Clothing is one of four basic human needs. People now turn to be a more

self-care, especially dressing up. We can see that the current clothing market in

Thailand is growing dramatically, that‘s why we choose women‘s shoes

business. The Ladies‘ Shoes Company will focus prior on Diversification

strategy to diversify our business to fulfill great prosperity. We use Concentric

strategy; we will add the new related products such as bags, hats, and other

accessories to sell in our shop. Secondly, we focus on Intensive strategy to

expand the business by using Market Development strategy; we will open new

branches in other areas in the North such as Chiang Mai and Payao where the

universities are located. These methods will help to increases the group of

customer, increase revenue and profit, and encourage us to be a leader in

comprehensive fashion business.

2.6.2 Business level

Product Differentiation

We provide the product which we are sure that the customer will satisfy

and want to buy. We offer a wide range of quality products that come from both

inside and outside the country with reasonable price. Most importantly, we will

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update new products every month. Be assured that we will not miss any trend

certainly.

Price Competition

As mentioned that we offer large selections of fashioned footwear. There

are many styles of product since simple to high quality. Then the prices are

varied and different. In price competition, we set the prices that are cheaper than

competitors by the reason that our customer are affordable and in order to make

high sale volume, to create market share rapidly, to increase cost

competitiveness, and to hinder competitors.

2.6.3 Functional level

Marketing

Determine scope of business or scope of marketing

Identify the main target customer which is women in Chiang Rai

Identify the positioning of our business

Identify marketing mix strategies (4Ps)

Forecasting and making a high market share

Learning and analyzing competitor‘s strategies

Accounting/Financial

Identify capital structure and finding fund

Prepare a systematic, clear, and accurate financial statement every

month and year

Improve a system of accounting and financial to be standard

Control every financial budget including taxation

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Human Resource Management

Recruiting and selecting of qualified persons

Training all employees for high quality teamwork, to learn

specialized knowledge, customer service skill, and good personality

Dividing work, and assigning appropriate position to each employee

Follow up and evaluating performance of employee

Operation

Offering and serving the best value for customers

Having service-minded, service from the heart

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Chapter 3 Market Feasibility Study

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Chapter 3

Market Feasibility Study

3.1 Marketing Analysis

3.1.1 General Environment Analysis

The general environment consists of the factors and forces outside the

company that affect marketing management‘s ability. These factors will

determine the opportunities and threats to our business.

Political Analysis

Political situation in Thailand is quite lack of stability in the present. Can

be seen from the past event when the mid of year 2010, the formation of a mob

of red shirt at Ratchaprasong intersection, which is a major shopping center, and

the focal point of the teenagers such as Siam Square, Central World, Siam

Paragon where many fashioned clothing shops were located.8

But today's political situation (December, 2010) is considered better. No

serious mass protest or mob. It allows recovery of shopping center and other

fashioned stores again.

Although political situation in Thailand is lack of stability but this

situation will culminates in competitors because bad situation influences the old

competitors so we will have less competitors after situation. The old customers

from old competitors will find the new store to buy products so this is a good

chance to penetrate the market.

8

http://www.corehoononline.com/index.php?option=com_multisitescontent&view=article&id=175:--1--

-&catid=20:2010-03-19-04-30-28&Itemid=25&site_id=Corehoon

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Economy Analysis

The Fiscal Policy Office (FPO), Ministry of Finance, announced that the

Thai economy in 2010 is forecasted to expand at 3.3% per year (or within the

range of 2.5 - 4.1% per year), given continued with the expansionary fiscal

policy from late continuing from late 2009 particularly from public expenditures

under the ―Strong Thailand 2012 Thai Khem Khaeng‖ programplan as the major

drive, along with well as the revival of private expenditures that would exhibit

an improving trend from the low base in 2009.9

Chiang Rai is part of Economic Quadrangle Cooperation. The general

trading conditions in Chiang Rai, it continues to grow have seen from statistics

of the limited partnership and company limited that were registered especially

construction business, trading, import - export of agricultural raw materials. And

increase of hotel business raising the growth of Chiang Rai economy and

consumer spending.10

Private investment; the construction in October 2009

continues to accelerate from the same month at previous year to 160.8% of

residential construction based on the permitted area in the municipality. The

investment in manufacturing was also increase, as a result of domestic economic

recovery, investors are attracted to invest more. The important indicators are

number of registered new plant from 3 plants in the same month last year

increased to 9 plants. The number of new business registered remained relatively

flat from the same month last year with a number of 26 cases.11

In the sense of fashion trend especially clothes, bags, shoes and other

accessories are catching on this time because the most of women still be satisfied

to follow the new trends that flow continually.

9

http://www.thaipr.net/nc/readnews.aspx?newsid=2206EFD51ED25CE09046C3242B2567A1&sec=all&q

uery=U3Ryb25nIFRoYWlsYW5kIDIwMTJUaGFpIEtoZW0gS2hhZW5n

10 http://pcoc.moc.go.th/wappPCOC/views/dfactsheet.aspx?pv=57

11 http://www.klangcri.com/team/team3/data/econemy/2553/1.%20Oct%202552.pdf

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Social and Environment Analysis

Chiang Rai province is developing. Chaing Rai has a lot of teenage

especially, in front of Mae Fah Lung University and Chiang Rai Rajabhat

University. Mostly teenage like follow fashion trends and the number of Shoe

stores had a little in Chiang Rai as follow fashion trend and quality. When you

want to buy shoes you have to buy Urban or Big C. It is so far from Mae Fah

Lung University and Chiang Rai Rajabhat University.

Shoe fashion trends for autumn – winter 2010 differ from previous trends

with strictness of forms and colors. The new season seems to be much more

‗practical‘ than last Autumn/Winter 2008/2009 shoe trend.

There are no more strange forms, motley palette and huge elements. Now

couturiers choose quality, simplicity and style. Of course some fashion designers

presented their extravagant lines of footwear as well, but in the time of economic

decline it looks defiant. Try to choose easy-to-wear styles. Currently timeless

footwear is top trendy. The color palette for the coming cold season looks dark,

nearly mystic. Near-black and black and colors that go between midnight blue,

asphalt, dark green, petrol, dark violet and deep reds display themselves from an

inconceivable side. Neutral skin and leather tones set confrontations to this

extraordinary darkness with a difference of shades from beige to grey to taupe.

Red and berry shades bring life into the good mood. Medium brown tones,

particularly the trend color cognac, will bring new thrust into the footwear

fashion. 12

Technology Analysis

Modern Web technology enables us to showcase and sell products at

once, and equally well. Today, most fashion brands no longer divide their online

presence between their product line and e-commerce, preferring to combine the

12

http://www.theinsider.com/news/2193013_Shoe_fashion_trends_for_Fall_2009_Winter_2010

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two under one domain or using their online store as their official website.

Another trend is the increasing use of interactive features and social-network

integration. Designers are taking advantage of the latest tools and techniques to

allow visitors to ―touch‖ their products and deliver exciting experiences. Live-

action previews of apparel, webcam functionality, connecting and sharing via

Facebook, even 3D viewing mode: with all of these entertaining baits, becoming

an online shopaholic is easier than ever.13

Commercial advertising media can serve to communicate an idea to a

large number of people in an attempt to convince them to take a certain action.

Commercial advertisers often seek to generate increased consumption of their

products or services through branding, which involves the repetition of an image

or product name in an effort to associate related qualities with the brand in the

minds of consumers. In 2010, spending on advertising was estimated at more

than $300 billion in the United States and $500 billion worldwide.14

E-commerce is one of advertising media to disseminate the fashion trend

via internet. Nowadays technology has been using to share the new idea of

fashion also showing the latest collection. Most of people use internet to keep up

with the fashion by see the new trend from oversea fashion website. Moreover

the customers are able to purchase the product on the internet by using i-

banking. There is on-line transaction such as pre-order which is the benefits for

the business. The technology helps to utilize the resource by saving the total

cost. For instance, instead of calling for the order, the online chat or E-mail is

the better choice. In summary, technology are more important and the

opportunity to reform the way of doing business.

13

http://www.smashingmagazine.com/2010/09/27/fashion-websites-trends-interviews-showcase/

14 http://en.wikipedia.org/wiki/Advertising

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3.1.2 Competition analysis (3C Analysis)

Competitor Analysis

1. Jenny – Located at Phaholyothin road, opposite to BigC Supercenter,

Chiang Rai.

Strength

The shop was located on the main road, so makes it easy to see and find

the shop. The shop has many products, and a lot of new products. The shoe is

placed just one side which helps to protect from being stolen and can place a lot

of shoe. The price is cheaper than other shops that located within BigC

Supercenter, so it can attract customers from BigC. For the atmosphere, there is

an air-conditioner that helps customer to feel comfort.

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Weakness

As a whole, the shop is considered at a good level. But there are still

disadvantages that the shop is too narrow compared to the number of shoes

available in the shop. It does not look to be comfortable. Another disadvantage

is the shop is far from the university made the students difficultly to access.

2. Varee Shoes – Located at near the old transport station, Chiang Rai.

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Strength

The shop is close to transport station which allows customers to visit

easier. It offers a wide selection of shoes and cheap price. The shop is open for

ventilation that makes feeling comfortable.

Weakness

There is quite low-quality of shoes because the shoes are not protected

from the dust from outside the shop, so it made the shoes look old.

3. Freshie – Located at Phaholyothin road, near Chiang Rai Rajabhat

University.

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Strength

The shop is near the university and adjacent to the main road.

The price is cheap.

Weakness

The shop provides low-quality shoes which considered from price. The

shoes are not various, and not up-to-date. Some shoes are very old because they

are on sale for a long time. The shop is small and inconspicuous.

4. No name shop – Located at Phaholyothin road, in front of Mae Fah

Luang University, Chiang Rai.

Strength

It is a single shop in front of the Mae Fah Luang University. So it has no

direct competitor. The shop provides documents suggest about choosing shoes

that conform to the zodiac. The shop is wide and colorful.

Weakness

The shop provide expensive price with low quality shoes.

There is less available of product. Moreover, the shop does not create the shop‘s

name, so make it is not interest because people do not recognize them

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Customer Analysis

Table 3.1 illustrate of all students in semester 2 / 2010 by the schools, education, and

gender of Mae Fah Luang University student.

Schools

Bachelor's degree

Male Female Total

School of Science 65 164 229

School of Liberal Arts 461 1,225 1,686

School of Management 643 1,411 2,054

School of Information

Technology 471 293 764

School of Agro Industry 22 118 140

School of Law 613 845 1,458

School of Cosmetic

Science 45 362 407

School of Health Science 141 646 787

School of Nursing 20 301 321

Total 2,481 5,365 7,846

http://reg.mfu.ac.th/registrar/statistics/RepStudent1.asp?acadyear=2553&maxsemester

=2&semester=2

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Table 3.2 illustrate of all students in year 2006 by the education levels and gender of Chiang Rai Rajabhat University student.

http://www.mua.go.th/infodata/49/all2549.htm

Figure 3.1 Gender of students

41%

59%

Gender

Male

Female

Lower Bachelor's degree Bachelor's degree Graduate Diploma Master's degree Ph.D. Total

Male Female Total Male Female Total Male Female Total Male Female Total Male Female Total Male Female Total

288 539 827 6046 7387 13433 16 35 51 640 621 1261 32 14 46 7022 8596 15618

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From our observation, the most population who live in Tambon Tasood,

and Tambon Bandoo, Amphur Muang, Chiang Rai is students. According to the

table above, in the second semester Mae Fah Luang University has 7,846

students which divided to 2,481 of male and 5,365 of female. There are female

undergraduate students of 5,365 people in Mae Fah Luang University which are

considered to be the largest group of student. For Chiang Rai Rajabhat

University, the male students were approximately 7,022 people and female

students were approximately 8,596 people. We can see that the amounts of

female students are more than male students in both universities. Therefore the

total of female students is approximately 13,961people account for 59% and the

total of male students is approximately 9,503 people account for 41%.

Teenagers are the most important target for doing fashion business

because they will concentrate on fashion, keep up with the new trends and

follow their friends or the group of superstar and celebrities which are the

inspiration for them.

Competitive Analysis

Nowadays, customers are different about their likes, needs, and wants

such as ladies want shoes that are different from man, fat people want shoes that

are different from thin people. When fashion move to shoes market, the likes,

needs, and wants are more expand as a result of their different income, education

and value. Thus, the competition of fashion shoes is not too many when

compared to the number of students. The major competitors are Jenny, Varee

shoes, Freshie and no name shop in front of Mae Fah Luang University. They

have same target customer which are student and they want to be a leader on

fashion shoes. The strengths in competition are the shops that provide many

products and good quality of products for customers. However, there are many

weaknesses in competition such as low quality product, more expensive product,

and located on remote area.

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3.2 STP Analysis

3.2.1 Segmentation

Our business will be located at in front of Mae Fah Luang University and

Chiang Rai Rajabhat University where the most population segments are

students and officers. Therefore in market segmentation, we will divide the

group of customers based on Demographic segmentation which in this case will

be measured from their occupation.

Figure 3.2 Occupation

Our business focuses on population who live in front of Mae Fah Luang

University and Chiang Rai Rajabhat University, so the occupation that almost

found in this area are student and officer. In addition, because of these segments

are affordable that can purchase our product.

Student: they earn income from their parents. The most of them earn

5,000 – 10,000 baht. They will purchase shoes from us because they

follow the fashion.

Officer: these are full-time working women. They typically earn more

than 6,000 baht. They will purchase shoes for the workplace, as well as

for leisure time.

60%

35%

5%

Occupation

Student

Officer

Other

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3.2.2 Target Market

As mentioned that The Ladies‘ Shoes shop will be located at in front of

Mae Fah Luang University and Chiang Rai Rajabhat University, therefore we

are targeting on female who age between 18-30 years old. For the occupation,

we are targeting two population segments which are students and officers who

earn income between 5,000-10,000 baht up. We are confident that our selected

target is affordable, can purchase our products which resulted to our company

can increase sale volumes, building market share, and make high profits for our

business as well.

3.2.3 Positioning

Figure 3.3 The positioning of The Ladies‘ Shoes

High quality

Low price

High quality

High price

Low quality

Low price

Low quality

High price

High

Low

Low High

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The positioning of The Ladies‘ Shoes is to deliver the satisfaction to

customers by offering large selections of good quality shoes with lower price,

and adding more value by serving customer with excellent service.

3.3 Marketing Mix Strategy

3.3.1 Product

Shoes are the device used to wear for walking. Its benefit is to prevent

our foot from contacting with various sharp objects. However, in view of other

people who love fashion, shoes are important accessories indispensable to show

the identity of their wearer.

The Ladies‘ Shoes offer large selections of fashioned footwear which

made from good quality materials such as leather and rubber, produced and

distributed from creditable company. Our products are classified into five

categories which based on quality and price. These five categories consist of

basic shoes, cut shoes, platform shoes, high heel shoes, and imported high heel

shoes.

Basic shoes

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Cut shoes

Platform shoes

High heel shoes

Imported high heel shoes

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The Ladies‘ Shoes will update the new trend as soon as possible. We will

seek for good quality product to offer our customers. So, the customers can

confident that the product they received are beautiful and durable.

Company’s Logo

Figure 3.3 Logo of The Ladies‘ Shoes

Slogan

The Ladies‘ Shoes‘ slogan is “Move forward with confidence.” It

means in our shop, you can try, buy our shoes that fit your best. When you gain

the best fit, you can wear your most beautiful pair of shoes moving forward with

the full of confidence.

3.3.2 Price

Regarding price strategy, The Ladies‘ Shoes focus on the affordability of

target customers who are almost student. Therefore we use Leading price

strategy – set the price as pleased regardless the competitors how much will

them set, no comparison. Thus, our price will be cheaper than competitors. We

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classify the price of shoes into 5 categories similar to the 5 product categories.

The price of a pair of shoe in the same category are equal.

Basic shoes: 199 Baht per pair

Cut shoes: 259 Baht per pair

Platform shoes: 329 Baht per pair

High heel shoes: 459 Baht per pair

Imported high heel shoes: 559 Baht per pair

3.3.3 Place

First Branch

The Ladies‘ Shoes is the retail store of fashion shoes that will be located

at 129/1 Moo1, Phaholyothin road, Tambon Tasud, Amphur Muang Chaing Rai

57100, or in front of Mae Fah Luang University that the customers can come to

see and try the real products, and then they will get the product that suit to

themselves.

Figure 3.4 Mae Fah Luang University

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Second Branch

The second branch of the Ladies‘ Shoes is the retail store of fashion

shoes and the main place of stocking inventory that will be located at, Tambon

Bandoo, Amphur Muang Chaing Rai 57100, or in front of Chiang Rai Rajabhat

University.

Figure 3.5 Chiang Rai Rajabhat University

3.3.4 Promotion

Advertisement

Advertising is a form of communication intended to persuade an

audience (viewers, readers or listeners) to purchase or take some action upon

products, ideas, or services. It includes the name of a product or service and how

that product or service could benefit the consumer, to persuade a target market to

purchase or to consume that particular brand. Advertising can also serve to

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communicate an idea to a large number of people in an attempt to convince them

to take a certain action.15

Advertising help us to share and distribute information, allow customers

to know what we sell, where our shop is located, what are some interesting and

so on. The Ladies‘ Shoes use Vinyl poster to inform customers about our

information such as shop‘s name, shop‘s location, and what‘s new.

Figure 3.6 Poster of The Ladies‘ Shoes

15

http://en.wikipedia.org/wiki/Advertising

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Sale promotion

Sales promotion includes several communications activities that attempt

to provide added value or incentives to consumers, wholesalers, retailers, or

other organizational customers to stimulate immediate sales. These efforts can

attempt to stimulate product interest, trial, or purchase.16

The sale promotion

that The Ladies‘ Shoes offer to customers is Discount. 10 – 50% discounts

depend on different festivals such as Shop‘s Birthday, Christmas day, New

Year, Valentine‘s Day, and school opening period.

3.4 Sale Forecast/Profit Estimation

For The ladies‘ shoes, the sale forecast is based on seasonal factors such

as shop‘s Birth day, Christmas day, New year, Valentine‘ day and Open new

semester period for students. These periods generate high sale volume because

of high demand for consumption.

3.4.1 First Branch

We estimate the sale from target group. There are 5,365 female students

and 679 staff s in Mae Fah Luang University, we estimate the sale equivalent to

5% - 10% each month.

16

http://www.davedolak.com/promo.htm

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Table 3.3 Sale Forecast of year 1

Sale Volume

Product Price Number Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Basic Shoes 199 150 110 115 120 130 160 150 785

Cut shoes 259 150 115 110 100 120 150 160 755

Platform shoes 329 80 60 65 70 80 90 90 455

High hill shoes 459 70 55 50 60 75 80 100 420

Imported high hill 559 20 15 10 10 15 20 30 100

Total 470 355 350 360 420 500 530 2515

Total sale

Product Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Basic Shoes 21,890 22,885 23,880 25,870 31,840 29,850 156,215

Cut shoes 29,785 28,490 25,900 31,080 38,850 41,440 195,545

Platform shoes 19,740 21,385 23,030 26,320 29,610 29,610 149,695

High hill shoes 25,245 22,950 27,540 34,425 36,720 45,900 192,780

Imported high hill 8,385 5,590 5,590 8,385 11,180 16,770 55,900

Total 105,045 101,300 105,940 126,080 148,200 163,570 750,135

Note: For year 1, the sale starts at July because we first open the shop on 9 July 2011.

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Figure 3.7 Sales Forecast of Year 1

0

5000

10000

15000

20000

25000

30000

35000

40000

45000

50000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Year 1

Basic Shoes

Cut shoes

Platform shoes

High heel shoes

Imported high heel

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Table 3.4 Sale Forecast of year 2

Sale Volume

Product Price Number Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Basic Shoes 199 165 170 160 110 120 100 110 121 127 132 143 176 165 1634

Cut shoes 259 165 170 170 110 110 120 100 127 121 110 132 165 176 1611

Platform shoes 329 90 120 100 70 75 70 80 66 71 77 88 99 99 1015

High hill shoes 459 80 80 70 65 60 60 70 60 55 66 82 88 110 866

Imported high hill 559 25 20 25 15 10 20 20 17 11 11 17 22 33 221

Total

525 560 525 370 375 370 380 391 385 396 462 550 583 5347

Total sale

Product

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Basic Shoes

33,830 31,840 21,890 23,880 19,900 21,890 24,079 25,273 26,268 28,457 35,024 32,835 325,166

Cut shoes

44,030 44,030 28,490 28,490 31,080 25,900 32,893 31,339 28,490 34,188 42,735 45,584 417,249

Platform shoes

39,480 32,900 23,030 24,675 23,030 26,320 21,714 23,359 25,333 28,952 32,571 32,571 333,935

High hill shoes

36,720 32,130 29,835 27,540 27,540 32,130 27,540 25,245 30,294 37,638 40,392 50,490 397,494

Imported high hill

11,180 13,975 8,385 5,590 11,180 11,180 9,503 6,149 6,149 9,503 12,298 18,447 123,539

Total

165,240 154,875 111,630 110,175 112,730 117,420 115,729 111,365 116,534 138,738 163,020 179,927 1,597,383

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Figure 3.8 Sales Forecast of Year 2

0

10,000

20,000

30,000

40,000

50,000

60,000

Jan Feb Mar May Jun Jul Aug Sep Oct Nov Dec

Year 2

Basic Shoes

Cut shoes

Platform shoes

High heel shoes

Imported high heel

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Table 3.5 Sale Forecast of year 3

Sale Volume

Product Price Number Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Basic Shoes 199 180 187 176 121 132 110 121 133 140 145 157 194 181 1797

Cut shoes 259 180 187 187 121 121 132 110 140 133 121 145 182 194 1773

Platform shoes 329 100 132 110 77 82 77 88 73 78 85 97 109 109 1117

High hill shoes 459 90 88 77 71 66 66 77 66 60 72 90 96 121 950

Imported high hill 559 30 22 28 17 11 22 22 19 12 12 19 24 36 244

Total

580 616 578 407 412 407 418 431 423 435 508 605 641 5881

Total sale

Product

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Basic Shoes

37,213 35,024 24,079 26,268 21,890 24,079 26,467 27,860 28,855 31,243 38,606 36,019 357,603

Cut shoes

48,433 48,433 31,339 31,339 34,188 28,490 36,260 34,447 31,339 37,555 47,138 50,246 459,207

Platform shoes

43,428 36,190 25,333 26,978 25,333 28,952 24,017 25,662 27,965 31,913 35,861 35,861 367,493

High hill shoes

40,392 35,343 32,589 30,294 30,294 35,343 30,294 27,540 33,048 41,310 44,064 55,539 436,050

Imported high hill

12,298 15,652 9,503 6,149 12,298 12,298 10,621 6,708 6,708 10,621 13,416 20,124 136,396

Total

181,764 170,642 122,843 121,028 124,003 129,162 127,659 122,217 127,915 152,642 179,085 197,789 1,756,749

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Figure 3.9 Sales Forecast of Year 3

0

10,000

20,000

30,000

40,000

50,000

60,000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Year 3

Basic Shoes

Cut shoes

Platform shoes

High heel shoes

Imported high heel

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Table 3.6 Sale Forecast of year 4

Sale Volume

Product Price Number Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Basic Shoes 199 195 206 194 133 145 121 133 166 154 160 169 213 199 2188

Cut shoes 259 195 206 205 133 133 145 121 159 146 133 160 200 213 2149

Platform shoes 329 115 145 121 85 90 85 97 80 86 94 107 120 120 1345

High hill shoes 459 100 96 85 84 73 73 85 73 66 79 99 106 133 1152

Imported high hill 559 35 24 31 19 12 24 24 21 13 13 21 26 40 303

Total

640 677 636 454 453 448 460 499 465 479 556 665 705 7137

Total sale

Product

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Basic Shoes

40,994 38,606 26,467 28,855 24,079 26,467 33,034 30,646 31,840 33,631 42,387 39,601 396,607

Cut shoes

53,354 53,095 34,447 34,447 37,555 31,339 41,181 37,814 34,447 41,440 51,800 55,167 506,086

Platform shoes

47,705 39,809 27,965 29,610 27,965 31,913 26,320 28,294 30,926 35,203 39,480 39,480 404,670

High hill shoes

44,064 39,015 38,556 33,507 33,507 39,015 33,507 30,294 36,261 45,441 48,654 61,047 482,868

Imported high hill

13,416 17,329 10,621 6,708 13,416 13,416 11,739 7,267 7,267 11,739 14,534 22,360 149,812

Total

199,533 187,854 138,056 133,127 136,522 142,150 145,781 134,315 140,741 167,454 196,855 217,655 1,940,043

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Figure 3.10 Sales Forecast of Year 4

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Year 4

Basic Shoes

Cut shoes

Platform shoes

High heel shoes

Imported high heel

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Table 3.7 Sale Forecast of year 5

Sale Volume

Product Price Number Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Basic Shoes 199 210 226 214 146 159 133 146 183 168 176 186 234 219 2,190

Cut shoes 259 210 226 225 146 146 159 133 175 161 146 176 220 234 2,147

Platform shoes 329 130 160 133 93 99 93 107 88 95 103 118 132 132 1,353

High hill shoes 459 115 106 93 92 80 80 93 80 73 87 109 117 146 1,156

Imported high hill 559 40 26 34 21 13 26 26 23 14 14 23 29 44 293

Total

705 744 699 498 497 491 505 549 511 526 612 732 775 7,139

Total sale

Product

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Basic Shoes

44,974 42,586 29,054 31,641 26,467 29,054 36,417 33,432 35,024 37,014 46,566 43,581 435,810

Cut shoes

58,534 58,275 37,814 37,814 41,181 34,447 45,325 41,699 37,814 45,584 56,980 60,606 556,073

Platform shoes

52,640 43,757 30,597 32,571 30,597 35,203 28,952 31,255 33,887 38,822 43,428 43,428 445,137

High hill shoes

48,654 42,687 42,228 36,720 36,720 42,687 36,720 33,507 39,933 50,031 53,703 67,014 530,604

Imported high hill

14,534 19,006 11,739 7,267 14,534 14,534 12,857 7,826 7,826 12,857 16,211 24,596 163,787

Total

219,336 206,311 151,432 146,013 149,499 155,925 160,271 147,719 154,484 184,308 216,888 239,225 2,131,411

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Figure 3.11 Sales of Year 5

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Year 5

Basic Shoes

Cut shoes

Platform shoes

High heel shoes

Imported high heel

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3.4.2 Second Branch

We estimate the sale from target group. There are 8,596 female students and 492 staffs in Chiang Rai Rajabhat University,

we estimate the sale equivalent to 5% - 10% each month.

Table 3.8 Sale Forecast of year 1

Sale Volume

Product Price Number Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Basic Shoes 199 200

180 160 170 185 200 220 1115

Cut shoes 259 200

180 178 180 175 167 190 1070

Platform shoes 329 120

95 82 95 100 120 120 612

High hill shoes 459 120

100 87 85 80 110 120 582

Imported high hill 559 30

28 25 25 28 24 30 160

Total

670

583 532 555 568 621 680 3539

Total sale

Product

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Basic Shoes

35,820 31,840 33,830 36,815 39,800 43,780 221,885

Cut shoes

46,620 46,102 46,620 45,325 43,253 49,210 277,130

Platform shoes

31,255 26,978 31,255 32,900 39,480 39,480 201,348

High hill shoes

45,900 39,933 39,015 36,720 50,490 55,080 267,138

Imported high hill

15,652 13,975 13,975 15,652 13,416 16,770 89,440

Total

175,247 158,828 164,695 167,412 186,439 204,320 1,056,941

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Figure 3.12 Sales of Year 1

0

10000

20000

30000

40000

50000

60000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Year 1

Basic Shoes

Cut shoes

Platform shoes

High heel shoes

Imported high heel

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Table 3.9 Sale Forecast of year 2

Sale Volume

Product Price Number Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Basic Shoes 199 220 200 190 150 165 160 185 198 176 187 203 220 242 2276

Cut shoes 259 220 187 195 150 160 170 180 198 196 198 192 184 209 2219

Platform shoes 329 130 120 100 90 95 100 100 104 90 104 110 132 132 1277

High hill shoes 459 130 115 96 90 90 95 95 110 96 93 88 121 132 1221

Imported high hill 559 35 32 28 25 27 25 30 31 25 27 31 26 33 340

Total

735 654 609 505 537 550 590 641 583 609 624 683 748 7208

Total sale

Product

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Basic Shoes

39,800 37,810 29,850 32,835 31,840 36,815 39,402 35,024 37,213 40,397 43,780 48,158 452,924

Cut shoes

48,433 50,505 38,850 41,440 44,030 46,620 51,282 50,764 51,282 49,728 47,656 54,131 574,721

Platform shoes

39,480 32,900 29,610 31,255 32,900 32,900 34,216 29,610 34,216 36,190 43,428 43,428 420,133

High hill shoes

52,785 44,064 41,310 41,310 43,605 43,605 50,490 44,064 42,687 40,392 55,539 60,588 560,439

Imported high hill

17,888 15,652 13,975 15,093 13,975 16,770 17,329 13,975 15,093 17,329 14,534 18,447 190,060

Total

198,386 180,931 153,595 161,933 166,350 176,710 192,719 173,437 180,491 184,036 204,937 224,752 2,198,277

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Figure 3.13 Sales of Year 2

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Year 2

Basic Shoes

Cut shoes

Platform shoes

High heel shoes

Imported high heel

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Table 3.10 Sale Forecast of year 3

Sale Volume

Product Price Number Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Basic Shoes 199 240 220 209 165 181 181 203 217 193 205 223 242 266 2505

Cut shoes 259 240 205 215 165 181 187 203 217 215 218 211 202 229 2448

Platform shoes 329 140 132 110 99 104 110 110 114 99 110 121 145 145 1399

High hill shoes 459 140 126 106 99 104 104 104 121 105 102 97 133 145 1346

Imported high hill 559 40 35 30 27 30 27 33 33 27 29 33 29 36 369

Total

800 718 670 555 600 609 653 702 639 664 685 751 821 8067

Total sale

Product

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Basic Shoes

43,780 41,591 32,835 36,019 36,019 40,397 43,183 38,407 40,795 44,377 48,158 52,934 498,495

Cut shoes

53,095 55,685 42,735 46,879 48,433 52,577 56,203 55,685 56,462 54,649 52,318 59,311 634,032

Platform shoes

43,428 36,190 32,571 34,216 36,190 36,190 37,506 32,571 36,190 39,809 47,705 47,705 460,271

High hill shoes

57,834 48,654 45,441 47,736 47,736 47,736 55,539 48,195 46,818 44,523 61,047 66,555 617,814

Imported high hill

19,565 16,770 15,093 16,770 15,093 18,447 18,447 15,093 16,211 18,447 16,211 20,124 206,271

Total

217,702 198,890 168,675 181,620 183,471 195,347 210,878 189,951 196,476 201,805 225,439 246,629 2,416,883

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Figure 3.14 Sales of Year 3

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Year 3

Basic Shoes

Cut shoes

Platform shoes

High heel shose

Imported high heel

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Table 3.11 Sale Forecast of year 4

Sale Volume

Product Price Number Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Basic Shoes 199 260 242 229 180 199 199 223 238 212 225 245 266 292 3010

Cut shoes 259 260 225 236 180 199 205 223 239 236 239 232 222 252 2948

Platform shoes 329 150 145 120 108 114 121 121 125 108 121 133 160 160 1686

High hill shoes 459 150 145 116 108 114 114 114 133 115 112 106 146 160 1633

Imported high hill 559 45 38 33 30 33 30 36 36 30 31 36 32 40 450

Total

865 795 734 606 659 669 717 771 701 728 752 826 904 9727

Total sale

Product

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Basic Shoes

48,158 45,571 35,820 39,601 39,601 44,377 47,362 42,188 44,775 48,755 52,934 58,108 547,250

Cut shoes

58,275 61,124 46,620 51,541 53,095 57,757 61,901 61,124 61,901 60,088 57,498 65,268 696,192

Platform shoes

47,705 39,480 35,532 37,506 39,809 39,809 41,125 35,532 39,809 43,757 52,640 52,640 505,344

High hill shoes

66,555 53,244 49,572 52,326 52,326 52,326 61,047 52,785 51,408 48,654 67,014 73,440 680,697

Imported high hill

21,242 18,447 16,770 18,447 16,770 20,124 20,124 16,770 17,329 20,124 17,888 22,360 226,395

Total

241,935 217,866 184,314 199,421 201,601 214,393 231,559 208,399 215,222 221,378 247,974 271,816 2,655,878

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Figure 3.15 Sales of Year 4

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Year 4

Basic shoes

Cut shoes

Platform shoes

High heel shoes

Imported high heel

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Table 3.12 Sale Forecast of year 5

Sale Volume

Product Price Number Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Basic Shoes 199 280 266 251 198 218 218 245 261 233 247 270 292 321 3,020

Cut shoes 259 280 247 259 198 218 225 245 262 259 262 255 244 277 2,951

Platform shoes 329 160 160 132 118 125 133 133 137 118 131 146 176 176 1,685

High hill shoes 459 160 160 127 118 125 125 125 146 126 123 116 160 176 1,627

Imported high hill 559 50 42 36 33 36 33 40 40 33 34 39 35 44 445

Total

930 875 805 665 722 734 788 846 769 797 826 907 994 9,728

Total sale

Product

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Basic Shoes

52,934 49,949 39,402 43,382 43,382 48,755 51,939 46,367 49,153 53,730 58,108 63,879 600,980

Cut shoes

63,973 67,081 51,282 56,462 58,275 63,455 67,858 67,081 67,858 66,045 63,196 71,743 764,309

Platform shoes

52,640 43,428 38,822 41,125 43,757 43,757 45,073 38,822 43,099 48,034 57,904 57,904 554,365

High hill shoes

73,440 58,293 54,162 57,375 57,375 57,375 67,014 57,834 56,457 53,244 73,440 80,784 746,793

Imported high hill

23,478 20,124 18,447 20,124 18,447 22,360 22,360 18,447 19,006 21,801 19,565 24,596 248,755

Total

266,465 238,875 202,115 218,468 221,236 235,702 254,244 228,551 235,573 242,854 272,213 298,906 2,915,202

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Figure 3.16 Sales of Year 5

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Year 5

Basic shoes

Cut shoes

Platform shoes

High heel shoes

Imported high heel

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3.5 Marketing Expense

The marketing expenses of The Ladies‘ Shoes consist of Vinyl posters which are posted at the roadsides and Billboards which are

posted at in front of our shop.

Table 3.8 Marketing Expense of year 1

Year 1 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Posters 0 0 0 0 0 0 1,050 0 0 0 0 0 1,050

Billboards 0 0 0 0 0 0 38,000 0 0 0 0 0 38,000

Total 0 0 0 0 0 0 39,050 0 0 0 0 0 39,050

Table 3.9 Marketing Expense of year 2

Year 2 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Poster 1,050 0 0 0 0 0 1,050 0 0 0 0 0 2,100

Billboards 0 0 0 0 0 0 0 0 0 0 0 0 0

Total 1,050 0 0 0 0 0 1,050 0 0 0 0 0 2,100

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Table 3.10 Marketing Expense of year 3

Year3 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Poster 1,050 0 0 0 0 0 1,050 0 0 0 0 0 2,100

Billboards 0 0 0 0 0 0 0 0 0 0 0 0 0

Total 1,050 0 0 0 0 0 1,050 0 0 0 0 0 2,100

Table 3.11 Marketing Expense of year 4

Year4 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Poster 1,050 0 0 0 0 0 1,050 0 0 0 0 0 2,100

Billboards 0 0 0 0 0 0 0 0 0 0 0 0 0

Total 1,050 0 0 0 0 0 1,050 0 0 0 0 0 2,100

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Table 3.12 Marketing Expense of year 5

Year5 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Poster 1,050 0 0 0 0 0 1,050 0 0 0 0 0 2,100

Billboards 0 0 0 0 0 0 0 0 0 0 0 0 0

Total 1,050 0 0 0 0 0 1,050 0 0 0 0 0 2,100

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3.6 Conclusion

From the sale forecast of The Ladies‘ Shoes in each year, it can clearly represent

that season is the factor to influence total sales for our business. It can be seen from the

high sale volume in period of the shop‘s Birthday, Christmas day, New year, Valentine‘

day and opening new semester period for students because this period has high demand

for shoes which come from dressing to welcome the new season, people will find the

new fashion shoes to dress up to go party and so on. Open new semester period for

students which the most of them are the students who are undergraduate study. They

can wear fashion shoes to study in the university and usually find new trend of fashion

shoes to wear for the new semester. From these reasons, the total sales of The Ladies‘

Shoes increase rapidly and also increase the growth rate in every year. However, there

are still low periods of sale such as March, April, and May because these periods have

no festival, people have less demand to buy the shoes. So we have some of sales that

come from the general customers who want to change their shoes, or want the new

shoes. The sale forecast of two branches (in front of Mae Fah Luang University and

Chiang Rai Rajabhat University) is estimated based on same criteria that depending on

season. The difference between two branches is the amount of female student and staff.

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Chapter 4 Technical Feasibility Analysis

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Chapter 4

Technical Feasibility Study

4.1 Production / Operation Analysis

4.1.1 Product Characteristic

Women's shoes range from conservative to sexy, and the right pair of

high heel shoes is one of the most versatile items you can have in your closet.

There are large selections of women fashion shoes waiting for you to see

and try your best. The products of The Ladies‘ Shoes are categorized to five

main groups which considered from the format, quality, source, and cost of

shoes. Therefore the products in each category are quite different. This

followings will exhibit the formats and prices of each category of our business.

Basic Shoes

At The Ladies‘ Shoes, basic shoes are the common form of shoes such as

low-heeled shoes and 1-2 inches high-heeled sandals which are comfortable to

wear. The price of Basic shoes is 199 baht per pair. The available sizes are 36-

40.

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Cut Shoes

Cut Shoes of The Ladies‘ Shoes are 2-3 inches high-heeled shoes which

have various lovely colors and patterns that suit for teenage. The price of Cut

shoes is 259 baht per pair. The available sizes are 36-40.

Basic Shoes

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Cut Shoes

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Platform Shoes

Platform Shoes of The Ladies‘ Shoes are 3½ - 5 inches iron heel shoes

which have various forms for both sweet and sour characters, suit for teenage

and adult. The price of Platform shoes is 329 baht per pair. The available sizes

are 36-40.

Platform Shoes

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High-heeled Shoes

High-heeled Shoes of The Ladies‘ Shoes are 3½ - 5 inches high-heeled

shoes with beautiful pattern, hot and spicy style which suit for women who have

high self-confidence. It is also suitable to wear for party. The price of High-

heeled shoes is 459 baht per pair. The available sizes are 36-40.

High-heeled Shoes

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Imported Shoes

Imported Shoes of The Ladies‘ Shoes are both 3½ - 5 inches high-heeled

shoes and low-heeled shoes which made from good quality leather. We import

variety of shoes formats to satisfy customers in different lifestyle. The price of

Imported shoes is 559 baht per pair. The available sizes are 36-40.

Imported Shoes

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4.1.2 Production / Service Process

Our business is a kind of retail business about women‘s fashion shoes.

So, we need to buy the shoes from manufacturers, wholesalers or other shoes

stores to retail sell again to the customers. According to offering the variety of

women‘s fashion shoes, our products will be bought from Bangkok where

fashion city is located and from the overseas like Korea and Hong Kong. Our

business has suppliers who are the finder and provider of products to our stores

which they have two methods to find the products, first they go to find and buy

the products by themselves at Bangkok along the shopping areas by using

company‘s truck. Second, they find the product via the internet and select to buy

the product from websites that are credible and trusty to ensure that the

purchased products have good quality and reasonable price.

Figure 4.1 Production process

Bangkok Websites

Supplier

Store

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4.1.3 Location and Layout

Location (First Branch)

Figure 4.2 Location of The Ladies‘ Shoes shop (First Branch)

The Ladies‘ Shoes shop locates at the area in front of Mae Fah Luang University, 129/1 Moo1, Phaholyothin road, Tambon

Tasood, Muang district, Chiang Rai province 57100. The store is built in the townhouse building next to Phu Luang river side

restaurant.

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Layout (First Branch)

Figure 4.3 Building of The Ladies‘ Shoes shop (First Branch)

The site of store is a 4 x 6 meters deep or 24 square meters building which are

divided into three levels. The first floor is utilized to be the shoes‘ store, the

second floor is utilized to be storage, and the third floor is utilized as part of the

office and meeting rooms.

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1. First floor

The inside of first floor is utilize for the store which consists of cashier,

showcases, shoes‘ shelves, chairs for customer, dining table for employee, and

toilet.

Figure 4.4 The first floor of The Ladies‘ Shoes shop (First Branch)

2. Second floor

Because of the area of this floor is less than another (around 4 x 2 meters

deep). So, the second floor is utilized to be the storage which uses to keep the

stock and other office supply.

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Figure 4.5 The second floor of The Ladies‘ Shoes shop (First Branch)

3. Third floor

The third floor is both the office and meeting room. There are manager‘s

desk, computer for finding information, file cabinet for collect documents, and a

set of sofa used for meeting.

Figure 4.6 The third floor of The Ladies‘ Shoes shop (First Branch)

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Location (Second Branch)

Figure 4.7 Location of The Ladies‘ Shoes shop (Second Branch)

The Ladies‘ Shoes shop locates at the area in front of Chiang Rai Rajabhat University, Phaholyothin road, Tambon Bando,

Muang district, Chiang Rai province 57100.

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Layout (Second Branch)

Figure 4.8 Building of The Ladies‘ Shoes shop (Second Branch)

The site of store is an 8 x 6 meters deep or 48 square meters building which

are divided into two levels. The first floor is utilized to be the shoes‘ store, and

the second floor is utilized to be storage, keep all the merchandise of two

branches.

1. First floor

The inside of first floor is utilize for the store which consists of cashier,

showcases, shoes‘ shelves, chairs for customer, dining table for employee, and

toilet. This location is broader than the first branch, so we have more showcases

and shoe‘ shelves to contain a lot of shoes.

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Figure 4.9 The first floor of The Ladies‘ Shoes shop (Second Branch)

2. Second floor

The second floor of this location is utilized to be the storage which uses

to keep the main stock and other office supply. There is no office in this

location, we use to it keep stock only.

Figure 4.10 The second floor of The Ladies‘ Shoes shop (Second Branch)

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Shop Exterior and Interior Design

Figure 4.11 The Ladies‘ Shoes shop Exterior Design

Figure 4.12 The Ladies‘ Shoes shop Interior Design

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4.1.4 Tool / Equipment

Item Picture Detail Unit Price/

Unit Total

1. Dining

Table

Table set with chairs

60cm.x120cm.

2 3,200 6,400

2.

Telephone

PANASONIC

2 400 800

3. Shoes

shelf

Size 120x60x150 Cm.

6 shelves.

6 950 5,700

4. Small

mirror

Size 32x38 Cm.

6 300 1,800

5. Fashion

sofa

Size1750x710/1050x850 2 5,600 11,200

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6. Desk

Size1500x800x750 3 4,900 14,700

7. Work

chair

Size470/570x580x810-930 MM.

4 1,700 6,800

8. Stool

chair

Size450x450x420 MM.

8 760 6,080

9. Fashion

sofa small

size

Size850x850x760 4 2,600 10,400

10. Air

condition

MitsubishiMS56E18UV-

T1

Capacity : 5.2kW

Net weight [Indoor unit]

: 15kg

1 17,990 17,990

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11.

Electrical

Fan

Imarflex

Screen size16 inch blade

6 739 4,434

12. Glass

Shelves

30x1.5 (8 shelves )

6 3,800 22,800

13.

Computer

set

Compaq Presario

CQ3072L (KY781AA

#AKL).

Intel Pentium Dual Core

Processor E5400

(2.7GHz). RAM1GB

DDR2 up to4GB.

Hard Drive 320GB

SATA at 7200rpm.

2 13,890 27,780

14. Large

mirror

Size60cm.x120cm. 3 1,200 3,600

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Office supplies

Item Picture Detail Unit Price/

Unit Total

1. Pen

Lanser

0.5mm.

Color: blue, red,

and black

2 box 150 300

2.Pencil

Baby

0.5mm.

2box 150 150

3. Eraser

Pelikon 1box 180 180

4. ruler Plastic

Ruler 30"

5 item 7 35

5. Liquid

paper

Papermate 3 item 50 150

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6. Scotch

Tape

Scotch Tape

1pack 99 99

7. Stapler

- High quality steel

construction

- Staples up to 18

sheets 50

2 item 75 150

8. Scissor

- Quality stainless

steel cutter with

color

plastic handle

- ―8‖inch

2 item 55 110

9. Cutter

- Size: 10 mm.

- Stainless steel

2 item 30 60

10.

Highlighter

- 2-5 mm.

- Large ink

supply for

Longer writing

over

450m.

Color: green,

yellow, pink,

orange

3 item 15 45

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11. Staple

- Max 10-1M, for

small stapler

- Staples up to 25

sheets

1 dozen 130 130

12. Bin

2 item 45 90

13.Calculator

-LCD screen

shows the

number at 14

Main

- Warranty:2 year

3 item 176 528

14. Mop

2 item 120 240

15. Broom

2 item 35 70

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16. The

dustpan

2 item 45 90

17. Adapter power plug

-CAT -6 holes

2 item 135 270

4.1.5 Logistic Management

Logistic is defined as a business planning framework for the

management of material, service, information and capital flows. It includes the

increasingly complex information, communication and control systems required

in today's business environment. (Logistix Partners Oy, Helsinki, FI, 1996)17

The main functions of a qualified logistician include inventory management,

purchasing, transportation, warehousing, consultation and the organizing and

planning of these activities.

Because of the freight of The Ladies‘ Shoes uses the company's trucks to

pick up products from shops, manufactures in Bangkok and others area. The 4-

wheel pickup truck can be used for general pattern like the product box by

packing on the rear of the truck. It has high mobility in the city and suitable for

non-large products and quick transportation.

The company‘s truck is a major process in getting products to meet

customer needs and it is a better way to reduce cost of transportation regarding

17

http://www.logisticsworld.com/logistics.htm

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time, money and especially the convenience that we can go wherever place the

good products are.

The supplier function of The Ladies‘ shoes concern to logistic

management, we assign two suppliers to organizing inventory management,

purchasing, transportation, warehousing, and negotiation, which are the same

function of logistician. In addition, two suppliers will go with the company‘s

truck to purchase the product.

Figure 4.13 The company‘s truck

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4.1.6 Facility Management

First floor

Figure 4.14 Facility Management

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The long-term objective of facility management is to promote the potential of

the main activities of the organization to be more efficient, in terms of increasing

productivity, reducing the cost of operations in the long term, and the market advantage

of the organization.18

Our company emphasizes to manage the first floor of the building

which is the area of actually running the operation and generate revenue. All of

equipments are arranged orderly, it will not be scattered that cause to disturb the

customers. By the way we also emphasize on the cleanliness of all equipments as well

as the floor because of our shop is on the roadside. Opening the doors may let the dust

come into the shop.

4.2 Cost of Investment

4.2.1 Pre-Operating cost

Billboard

Figure 4.15 The company‘s billboard

The billboard of company ordered from the shop of Sahasil Advertising,

located at 21/4 Moo.13 Phahonyothin Road, Robwieng District, Muang, Chiang

Rai. Telephone no. 0537-08762. Email address: [email protected].

The billboard made from translucent vinyl and using the light bulb inside that

makes the billboard light up. Dimensions: 0.7 × 3.7 meters or 2.59 square

meters. Price: 19,000 baht.

18

http://www.logisticsworld.com/logistics.htm

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Vinyl poster (English Version)

Size: 1.5x0.5 meters or 0.75 square meters. The price of creating vinyl

poster is 140 baht per a square meter, so 140 baht multiply 0.75 equal to 105

baht per one poster. These posters will be placed at in front of Mae Fah Luang

University area. For the first year we set up the new vinyl poster one time on

July because we just opening the shop. For year two later, our company set up

the new vinyl poster two times a year, start on January and once more on July.

For setting up the vinyl poster, we use five vinyl posters to set up at five places

per one time, so the cost of setting up the vinyl poster account for 105 baht

multiply 5 equal to 525 baht per time.

Vinyl poster tax (English Version)

The label tax rate is calculated per 500 square centimeters. Our vinyl

poster is 0.75 square meters or account for 7,500 square centimeters. The

content is all English letters that account for 40 baht per 500 square centimeters.

Therefore the price of vinyl poster is calculated as follow; 7,500 divided by 500

equal to 15, and then multiply 40 equal to 600 baht per one vinyl poster. So, our

company has to pay the label tax 3,000 baht for five vinyl posters at in front of

Mae Fah Luang University areas.

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Vinyl poster (Thai Version)

Size: 1.5x0.5 meters or 0.75 square meters. The price of creating vinyl

poster is 140 baht per a square meter, so 140 baht multiply 0.75 equal to 105

baht per one poster. These posters will be placed at in front of Chiang Rai

Rajabhat University area. For the first year we set up the new vinyl poster one

time on July because we just opening the shop. For the year two later, our

company set up the new vinyl poster two times a year, start on January and once

more on July. For setting up the vinyl poster, we use five vinyl posters to set up

at five places per one time, so the cost of setting up the vinyl poster account for

105 baht multiply 5 equal to 525 baht per time.

Vinyl poster tax (Thai Version)

The label tax rate is calculated per 500 square centimeters. Our vinyl

poster is 0.75 square meters or account for 7,500 square centimeters. The

content is both Thai and English letters that account for 20 baht per 500 square

centimeters. Therefore the price of vinyl poster is calculated as follow; 7,500

divided by 500 equal to 15, and then multiply 20 equal to 300 baht per one vinyl

poster. So, our company has to pay the label tax 1,500 baht for five vinyl posters

at in front of Chiang Rai Rajabhat University areas.

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Vehicle (Truck)

ISUZU D-MAX SPARK EX (Year 2005-2006), Manual Transmission

2500 cc. 4-wheels pickup truck. External Dimensions approximately 1.90 meters

wide, 4.90 meters long, and 2.20 meters high. Price 300,000 baht (Used car)19

Building adjustment and decoration

19

http://www.cmusedcar.com/%E0%B8%95%E0%B9%89%E0%B8%AD%E0%B8%87%E0%B8%81%E

0%B8%B2%E0%B8%A3%E0%B8%82%E0%B8%B2%E0%B8%A2%E0%B8%A3%E0%B8%96%E0

%B8%81%E0%B8%A3%E0%B8%B0%E0%B8%9A%E0%B8%B0%E0%B8%9A%E0%B8%A3%E0%

B8%A3%E0%B8%97%E0%B8%B8%E0%B8%81%E0%B8%94%E0%B9%88%E0%B8%A7%E0%B8

%99/M3853.html

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- Flooring with tiles

- Installing clear glass at storefront

- Painting the walls

- Installing glass shelves

- Installing the lamps

- Other decorations

Company Limited Registration

The name of company is The Ladies‘ Shoes Company limited. We use

the company‘s name same as the name of shop.

Information used to register as follows:

1. Documents for register (55 Baht)

2. Company‘s name (the same as the name reserved)

3. Location‘s office (located at province)

4. Objective of the company

5. Registered capital must be divided into each share with the same value

6. Name, address, age, occupation and number of shares those people who

start up the company reserve to buy the shares

7. Name, address, age of 2 witnesses

* Complete registration process and rate for investment will show in Appendix

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Table 4.1 Summary of Pre-Operating cost

NO. Pre-Operating cost

Cost

1. Company‘s Billboard 38,000

2. Vinyl posters (5 pieces) Thai version 525

3. Vinyl poster taxes 1,500

4. Vinyl posters (5 pieces) English version 525

5. Vinyl poster taxes 3,000

6. Vehicle (Truck) 300,000

7. Air conditioner installation 2,000

8. Telephone and Internet installation 1,700

10. Tools and equipments 140,484

11. Building adjustment and decoration 300,000

12. Rental Building Mae Fah Luang 6,000

13. Rental Building Chaing Rai Rajabhat 1,000

14.

Company Limited Registration 12,000

Total 815,734

4.2.2 Investment cost

Table 4.2 Investment cost

Investment Amount Depreciation time Annual DEP.

1.Vehicle (Truck) 300,000 5 Years 60,000

2.Fashion sofa 22,400 8 Years 5600

3.Computer set 55,560 3 Years 18520

4.Air Conditioner 35,980 5 Years 7,196

5.Building MFU 6,000 - -

6.Building CRU 10,000 - -

7.Office Supplies 4,192 - -

Total 404,857 - 88,516

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4.2.3 Equipments and Tools

Table 4.3 Equipments and Tools

NO. Item Units Price per unit Total

1. Fashion sofa

2 5,600 11,200

2. Desk 3 4,900 14,700

3. Work chair

4 1,700 6,800

4. Stool chair

8 760 6,080

5. Fashion sofa (small)

size

size

4 2,600 10,400

6. Electrical Fan 6 739 4,434

7. Computer set

2 13,890 27,780

8. Large Mirror 3 1,200 3,600

9. Glass Shelves 6 3,800 22,800

10. Air Condition

1 17,990 17,990

11. Dining Table 2 3,200 6,400

12. Telephone

2 400 800

13. Shoes shelves

Shoes shelf

Shoes shelf

Shoes shelf

Shoes shelf

6 950 5,700

14. Small mirror

Shoes shelf

6 300 1,800

Total 140,484

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4.2.4 Depreciation

Table 4.4 Depreciation Year 1

Investment Amount Dep./

year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

1.Vehicle 300,000 60,000 0 0 0 0 0 0 10,000 10,000 10,000 10,000 10,000 10,000 60,000

2.Fashion

sofa 11,200 1,400 0 0 0 0 0 0 233 233 233 233 233 233 1,400

3.Computer

set 27,780 9,260 0 0 0 0 0 0 1,543 1,543 1,543 1,543 1,543 1,543 9,260

4.Air

Conditioner 17,990 3,598 0 0 0 0 0 0 600 600 600 600 600 600 3,598

Total 356,970 74,258 0 0 0 0 0 0 12,378 12,378 12,378 12,378 12,378 12,378 74,258

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Table 4.5 Depreciation Year 2

Investment Amount Dep./

year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Accumulated

Depreciation

1.Car 300,000 60,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 120,000

2.Fashion

sofa 11,200 1,400 117 117 117 117 117 117 117 117 117 117 117 117 2,800

3.Computer

set 27,780 9,260 772 772 772 772 772 772 772 772 772 772 772 772 18,520

4.Air

Condition 17,990 3,598 300 300 300 300 300 300 300 300 300 300 300 300 7,196

Total 356,970 74,258 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 148,516

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Table 4.6 Depreciation Year 3

Investment Amount Dep./

year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Accumulated

Depreciation

1.Car 300,000 60,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 180,000

2.Fashion

sofa 11,200 1,400 117 117 117 117 117 117 117 117 117 117 117 117 4,200

3.Computer

set 27,780 9,260 772 772 772 772 772 772 772 772 772 772 772 772 27,780

4.Air

Condition 17,990 3,598 300 300 300 300 300 300 300 300 300 300 300 300 10,794

Total 356,970 74,258 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 222,774

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Table 4.7 Depreciation Year 4

Investment Amount Dep./

year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Accumulated

Depreciation

1.Car 300,000 60,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 240,000

2.Fashion

sofa 11,200 1,400 117 117 117 117 117 117 117 117 117 117 117 117 5,600

3.Computer

set 27,780 0 0 0 0 0 0 0 0 0 0 0 0 0 0

4.Air

Condition 17,990 3,598 300 300 300 300 300 300 300 300 300 300 300 300 14,392

Total 356,970 64,998 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 259,992

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Table 4.8 Depreciation Year 5

Investment Amount Dep./

year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Accumulated

Depreciation

1.Car 300,000 60,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 300,000

2.Fashion

sofa 11,200 1,400 117 117 117 117 117 117 117 117 117 117 117 117 7,000

3.Computer

set 27,780 0 0 0 0 0 0 0 0 0 0 0 0 0 0

4.Air

Condition 17,990 3,598 300 300 300 300 300 300 300 300 300 300 300 300 17,990

Total 356,970 64,998 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 324,990

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4.3 Management Analysis

4.3.1 Organization Management

The Ladies‘ Shoes is small organization. Our organization management is an

informal organization structure that one person can do many functions that they can do,

it is not too hard because of the small company. We work with fashion women shoes

and open shop in front of Mae Fah Luang University and Chiang Rai Rajabhat

University. We have to manage stock well because fashion products are out of date so

quickly. First-in first-out is the strategy that will use for manage our organization. We

have all six workers which consist of one manager, two cashiers, two sale

representatives and one supplier. Each department is responsible more over one task

such as cashier can help the sale representative to sell the product. So they have to learn

the others tasks and can help to take care of shop as well.

Delegation of each position

1. General Manager

Duty – Manager is accountable for Human resource management, financial

control and marketing management

Authority – control and manage overall image in shop include manage other

departments in organization.

Obligations – take care of recruit new employees, audits account and

manage about service, check stock in shop.

2. Cashier

Duty – Cashier is responsible for making general ledger that locate the

revenue from the sale per day

Authority - Handle customer‘s payment return them the change

Obligation – Using computer program to calculate and gather in data of

sales

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3. Sale representative

Duty – A sales representative is responsible for selling products, answers

questions and give advice for customer

Authority - Help customer to find the most appropriate format and size of

shoes to customer

Obligations - Have to keep in touch and follow up with current and

prospective customers

4. Supplier

Duty – Finding and purchasing the product, find the best merchandise at the

lowest possible purchase cost. Checking stock

Authority – Negotiate prices and grant contracts between supplier

Obligation – Purchasers typically buy goods and services for their company

or organization to use, while buyers ordinarily buy items in order to resale

them for profit. Purchasers and buyers find the best goods or services,

choose suppliers, negotiate prices, and grant contracts that ensure that the

right amount of the product or service is received when it is needed.

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Detail of qualifications and salary of each position

Job Position General Manager

Qualifications * Male or female age between 25-35 years old

* Bachelor degree in Business Administration or related

field

* Strong Leadership skill

* Pleasant personality and service mind

* Being enthusiastic and active person

* Knowledge in Management organization, Accounting,

Financing, Marketing, and Human Resource Management

* High responsibility and motivation

* At least 5 years working experience

Job type Full time

Benefits Annually bonus, compensation, discount, and social

securities

Salary 12,000 Baht

Time schedule Monday-Sunday: 11.00AM – 07.00PM

Job Position Cashier

Qualifications * Female age between 22-30 years old

* Vocational certificate in Accounting

* Pleasant personality and service mind

* Being enthusiastic and active person

* Good communication, negotiation and selling skills

* Computer skills such as Microsoft office

* Skill of Accounting is an advantage

Job type Full time

Benefits Annually bonus, compensation, discount, and social

securities

Salary 5,000 Baht

Time schedule Monday-Sunday: 11.00AM – 08.00PM

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Job Position Sale representative

Qualifications * Female age between 18-25 years old

* Vocational certificate or high school education

* Pleasant personality and service mind

* Being enthusiastic and active person

* Good communication, negotiation and selling skills

* Computer skills such as Microsoft office

* Skill of Accounting is an advantage

Job type Full time

Benefits Annually bonus, compensation, discount, and social

securities

Salary 5,000 Baht

Time schedule Monday-Sunday: 11.00AM – 08.00PM

Job Position Supplier

Qualifications * Female age between 22-28 years old

* Vocational certificate or Bachelor degree in any field

* Pleasant personality and service mind

* Being enthusiastic and active person

* Good communication, negotiation and selling skills

* Computer skills such as Microsoft office

* Fashion lover, keep up with the new fashion trend

* Skill of stock management is an advantage

Job type Full time

Benefits Annually bonus, compensation, discount, and social

securities

Salary 9,000 Baht

Time schedule Monday-Sunday: 11.00AM – 08.00PM

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4.3.2 Organization Chart

Figure 4.16 Organization chart

General Manager

Human resource management – recruiting, training arrangement, compensation

Accounting and financial management – audit, financial control, financial statement report

Marketing management – marketing strategy Control and manage overall function in store

Cashier

Cashier is responsible for making

general ledger that locates the

revenue from the sale per day

Handle customer‘s payment

return them the change

Using computer program to

calculate and gather in data of

sales

Sales Representative

A sales representative is responsible for

selling products, answers questions and give

advice for customer

Help customer to find the most appropriate

format and size of shoes to customer

Have to keep in touch and follow up with

current and prospective customers

Supplier

Finding and Purchasing the

product

Negotiate prices and grant

contracts between supplier

Checking stock

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4.3.3 Administration Cost

First Branch (Mae Fah Luang University)

Table 4.9 Administration Expense Year 1

Description Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Rental Fee 0 0 0 0 0 0 6000 6000 6000 6000 6000 6000 36000

Salary 0 0 0 0 0 0 31,000 31,000 31,000 31,000 31,000 31,000 186,000

Telephone 0 0 0 0 0 0 500 500 500 500 500 500 3000

Internet 0 0 0 0 0 0 590 590 590 590 590 590 3540

Water supplies 0 0 0 0 0 0 100 100 100 100 100 100 600

Electricity 0 0 0 0 0 0 750 750 750 750 750 750 4500

Maintenance 0 0 0 0 0 0 30 90 170 150 200 300 940

Total 0 0 0 0 0 0 38,970 39,030 39,110 39,090 39,140 39,240 234,580

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Table 4.10 Administration Expense Year 2

Description Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Rental Fee 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 72000

Salary 31,000 31,000 31,000 31,000 31,000 31,000 31,000 31,000 31,000 31,000 31,000 31,000 372,000

Telephone 500 500 500 500 500 500 500 500 500 500 500 500 6000

Internet 590 590 590 590 590 590 590 590 590 590 590 590 7080

Water supplies 100 100 100 100 100 100 100 100 100 100 100 100 1200

Electricity 750 750 750 750 750 750 750 750 750 750 750 750 9000

Maintenance 250 350 300 200 230 210 300 400 300 200 250 280 2840

Total 39,190 39,290 39,240 39,140 39,170 39,150 39,240 39,340 39,240 39,140 39,190 39,220 470,120

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Table 4.11 Administration Expense Year 3

Description Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Rental Fee 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 72000

Salary 31,000 31,000 31,000 31,000 31,000 31,000 31,000 31,000 31,000 31,000 31,000 31,000 372,000

Telephone 500 500 500 500 500 500 500 500 500 500 500 500 6000

Internet 590 590 590 590 590 590 590 590 590 590 590 590 7080

Water supplies 100 100 100 100 100 100 100 100 100 100 100 100 1200

Electricity 750 750 750 750 750 750 750 750 750 750 750 750 9000

Maintenance 140 150 300 210 300 120 180 280 200 200 300 300 2380

Total 39,080 39,090 39,240 39,150 39,240 39,060 39,120 39,220 39,140 39,140 39,240 39,240 469,660

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Table 4.12 Administration Expense Year 4

Description Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Rental Fee 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 72000

Salary 31000 31000 31000 31000 31000 31000 31000 31000 31000 31000 31000 31000 372000

Telephone 500 500 500 500 500 500 500 500 500 500 500 500 6000

Internet 590 590 590 590 590 590 590 590 590 590 590 590 7080

Water supplies 100 100 100 100 100 100 100 100 100 100 100 100 1200

Electricity 750 750 750 750 750 750 750 750 750 750 750 750 9000

Maintenance 120 200 220 230 210 400 500 200 120 230 300 500 2250

Total 39060 39140 39160 39170 39150 39340 39440 39140 39060 39170 39240 39440 469530

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Table 4.13 Administration Expense Year 5

Description Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Rental Fee 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 72000

Salary 31000 31000 31000 31000 31000 31000 31000 31000 31000 31000 31000 31000 372000

Telephone 500 500 500 500 500 500 500 500 500 500 500 500 6000

Internet 590 590 590 590 590 590 590 590 590 590 590 590 7080

Water supplies 100 100 100 100 100 100 100 100 100 100 100 100 1200

Electricity 750 750 750 750 750 750 750 750 750 750 750 750 9000

Maintenance 200 230 300 500 230 300 290 230 250 400 500 220 2600

Total 39140 39170 39240 39440 39170 39240 39230 39170 39190 39340 39440 39160 469880

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Second Branch (Chiang Rai Rajabhat University)

Table 4.13 Administration Expense Year 1

Description Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Rental Fee 0 0 0 0 0 0 6000 6000 6000 6000 6000 6000 36000

Salary 0 0 0 0 0 0 15000 15000 15000 15000 15000 15000 90000

Telephone 0 0 0 0 0 0 500 500 500 500 500 500 3000

Internet

0 0 0 0 0 0 100 100 100 100 100 100 600

Water supplies

0 0 0 0 0 0 500 500 500 500 500 500 3000

Electricity 0 0 0 0 0 0 30 90 150 150 200 200 940

Maintenance 0 0 0 0 0 0 22130 22190 22250 22250 22300 22300 133540

Total 0 0 0 0 0 0 6000 6000 6000 6000 6000 6000 36000

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Table 4.14 Administration Expense Year 2

Description Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Rental Fee 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 72000

Salary 15000 15000 15000 15000 15000 15000 15000 15000 15000 15000 15000 15000 180000

Telephone 500 500 500 500 500 500 500 500 500 500 500 500 6000

Internet

100 100 100 100 100 100 100 100 100 100 100 100 1200

Water supplies

500 500 500 500 500 500 500 500 500 500 500 500 6000

Electricity

250 200 300 200 230 250 300 180 170 200 200 280 2840

Maintenance 22350 22300 22400 22300 22330 22350 22400 22280 22270 22300 22300 22380 268040

Total 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 72000

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Table 4.15 Administration Expense Year 3

Description Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Rental Fee 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 72000

Salary 15000 15000 15000 15000 15000 15000 15000 15000 15000 15000 15000 15000 180000

Telephone 500 500 500 500 500 500 500 500 500 500 500 500 6000

Internet 590 590 590 590 590 590 590 590 590 590 590 590 7080

Water supplies 100 100 100 100 100 100 100 100 100 100 100 100 1200

Electricity 500 500 500 500 500 500 500 500 500 500 500 500 6000

Maintenance 140 150 300 210 180 120 180 280 190 200 300 130 2380

Total 22830 22840 22990 22900 22870 22810 22870 22970 22880 22890 22990 22820 274660

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Table 4.16 Administration Expense Year 4

Description Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Rental Fee 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 72000

Salary 15000 15000 15000 15000 15000 15000 15000 15000 15000 15000 15000 15000 180000

Telephone 500 500 500 500 500 500 500 500 500 500 500 500 6000

Internet

100 100 100 100 100 100 100 100 100 100 100 100 1200

Water supplies

500 500 500 500 500 500 500 500 500 500 500 500 6000

Electricity

120 200 220 230 210 140 190 200 120 230 210 180 2250

Maintenance 22220 22300 22320 22330 22310 22240 22290 22300 22220 22330 22310 22280 267450

Total 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 72000

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Table 4.16 Administration Expense Year 4

Description Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Rental Fee 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 72000

Salary 15000 15000 15000 15000 15000 15000 15000 15000 15000 15000 15000 15000 180000

Telephone 500 500 500 500 500 500 500 500 500 500 500 500 6000

Internet

100 100 100 100 100 100 100 100 100 100 100 100 1200

Water supplies

500 500 500 500 500 500 500 500 500 500 500 500 6000

Electricity

200 230 300 140 230 190 290 230 250 130 190 220 2600

Maintenance 22300 22330 22400 22240 22330 22290 22390 22330 22350 22230 22290 22320 267800

Total 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 72000

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4.4 Conclusion

The Ladies‘ Shoes is retail business of women fashion shoes. We provide a lot

of products which are divided into various categories. The shops have two branches

located at in front of Mae Fah Luang University and Chiang Rai Rajabhat University.

Establishing the shop, we pay for the pre-operating cost for 815,734 baht that including

building adjustment and decoration, billboard, vinyl poster, taxes, vehicle, company

limited registration, and so on, investment cost for 404,857baht, and equipments and

tools for 140,848 baht.

In part of management, we are small and informal organization. There are four

main functions in the company; first, manager who control everything in the company,

and focus on financial management, accounting audit, human resource management,

and marketing management. Second, Cashier, doing a lot about payment and sales, and

making general ledger that locates the revenue from the sale per day. Third, sale

representative, responsible for selling products, answers questions and give advice for

customer. Fourth, supplier who response for finding, purchasing the products and also

stock management. We can see that one person can do various functions which help us

to save the cost of employee.

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Chapter 5 Financial Analysis

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5.1 Income Statement

Year1 Ja

n

Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Revenue 280,292 260,128 270,635 293,492 334,639 367,890 1,807,07

6

Less :Cost of goods sold 142,900 142,900 142,900 142,900 142,900 142,900 857,400

Gross margin 137,392 117,228 127,735 150,592 191,739 224,990 949,676

Less :Operating

Expenses

Marketing Expense - - - - -

-

-

Administrative Expense 61,100 61,220 61,360 61,340 61,440 61,540 368,000

Pre-Operation cost 602,591 - - - -

-

601,516

Deprecation 12,376 12,376 12,376 12,376 12,376 12,376 74,258

Total Operating Expense 676,067 73,596 73,736 73,716 73,816 73,916 1,043,77

4

Income before Income

taxes

-538,675 43,632 53,999 76,876 117,923 151,074 -95,173

Taxes 30% -161,603 13,090 16,200 23,063 35,377 45,322 -28,552

Net Income/Loss -377,073 30,542 37,799 53,813 82,546 105,752 -66,621

Retain earning -377,073 -346,531 -308,732 -254,919 -172,373 -66,621 -66,621

*No marketing expense because it included in operating expense

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Income Statement Year 2

Year2 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Revenue

363,626

335,806

265,225

272,108

279,080

294,130

308,448

284,802

297,025

322,774

367,957

404,679

3,795,660

Less :Cost of goods sold

153,850

153,850

153,850

153,850

153,850

153,850

153,850

153,850

153,850

153,850

153,850

153,850

1,846,200

Gross margin

209,776

181,956

111,375

118,258

125,230

140,280

154,598

130,952

143,175

168,924

214,107

250,829

1,949,460

Less :Operating

Expenses

Marketing Expense

Administrative Expense 1,050 - - - - - 1,050 - - - - - 2,100

Pre-Operation cost 61540 61590 61640 61440 61500 61500 61640 61620 61510 61440 61490 61600 466,698

Deprecation

6,189

6,188

6,188

6,188

6,188

6,188

6,188

6,188

6,188

6,188

6,188

6,188

74,258

Total Operating

Expense

68,779

67,778

67,828

67,628

67,688

67,688

68,878

67,808

67,698

67,628

67,678

67,788

543,056

Income before Income

taxes

140,997

114,178

43,547

50,630

57,542

72,592

85,720

63,144

75,477

101,296

146,429

183,041

1,134,591

Taxes 30%

42,299

34,253

13,064

15,189

17,263

21,778

25,716

18,943

22,643

30,389

43,929

54,912

340,377

Net Income/Loss

98,698

79,924

30,483

35,441

40,279

50,814

60,004

44,201

52,834

70,907

102,500

128,129

794,214

Retain earning

32,077

112,001

142,484

177,925

218,204

269,019

329,022

373,223

426,057

496,964

599,464

727,593

727,593

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Income Statement Year 3

Year3 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Revenue

399,466

369,532

291,518

302,648

307,474

324,536

338,537

312,168

324,391

354,447

404,524

444,418

4,173,659

Less :Cost of goods

sold

156,200 156,200 156,200 156,200 156,200 156,200 156,200 156,200 156,200 156,200 156,200 156,200

1,874,400

Gross margin 243,266 213,332 135,318 146,448 151,274 168,336 182,337 155,968 168,191 198,247 248,324 288,218 2,299,259

Less :Operating

Expenses

Marketing Expense

Administrative

Expense 1,050 - - - - - 1,050 - - - - - 2,100

Pre-Operation cost

61,910

61,930

62,230

62,050

62,110

61,870

61,990

62,190

62,020

62,030

62,230

62,060

744,620

Deprecation 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 6,189 74,268

Total Operating

Expense

69,149

68,119

68,419

68,239

68,299

68,059

69,229

68,379

68,209

68,219

68,419

68,249

820,988

Income before Income

taxes

174,117

145,213

66,899

78,209

82,975

100,277

113,108

87,589

99,982

130,028

179,905

219,969

1,478,271

Taxes 30%

52,235

43,564

20,070

23,463

24,893

30,083

33,932

26,277

29,995

39,008

53,972

65,991

443,481

Net Income/Loss

121,882

101,649

46,829

54,746

58,083

70,194

79,176

61,312

69,987

91,020

125,934

153,978

1,034,790

Retain earning

849,475

951,124

997,953

1,052,700

1,110,782

1,180,976

1,260,152

1,321,464

1,391,451

1,482,471

1,608,404

1,762,383

1,762,383

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Income Statement Year 4

Year4 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Revenue

441,468

405,720

322,370

332,548

338,123

356,543

377,340

342,714

355,963

388,882

444,829

489,471

4,595,971

Less :Cost of

goods sold 191,000 191,000 191,000 191,000 191,000 191,000 191,000 191,000 191,000 191,000 191,000 191,000 2,292,000

Gross margin 250,468 214,720 131,370 141,548 147,123 165,543 186,340 151,714 164,963 197,882 253,829 298,471 2,303,971

Less :Operating

Expenses

Marketing

Expense

Administrative

Expense

1,050 - -

- - -

1,050 -

- -

- -

2,100

Pre-Operation

cost

61,280

61,440

61,480

61,500

61,460

61,580

61,730

61,440

61,280

61,500

61,550

61,720

737,960

Deprecation

5,417

5,417

5,417

5,417

5,417

5,417

5,417

5,417

5,417

5,417

5,417

5,417

64,998

Total Operating

Expense

67,747

66,857

66,897

66,917

66,877

66,997

68,197

66,857

66,697

66,917

66,967

67,137

805,058

Income before

Income taxes

182,722

147,864

64,474

74,632

80,247

98,547

118,144

84,858

98,267

130,966

186,863

231,335

1,498,913

Taxes 30% 54816 44359 19342 22389 24074 29564 35443 25457 29480 39290 56059 69400 449674

Net Income/Loss

127,905

103,504

45,131

52,242

56,173

68,983

82,700

59,400

68,787

91,676

130,804

161,934

1,049,239

Retain earning

1,890,288

1,993,793

2,038,924

2,091,166

2,147,339

2,216,321

2,299,022

2,358,422

2,427,208

2,518,884

2,649,688

2,811,622

2,566,622

Page 134: The Ladies' Shoes Co.,Ltd

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Income Statement Year 5

Year5 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Revenue

485,801

445,186

353,547

364,481

370,735

391,627

414,515

376,270

390,057

427,162

489,601

538,131

5,047,113

Less :Cost of

goods sold 183,600 183,600 183,600 183,600 183,600 183,600 183,600 183,600 183,600 183,600 183,600 183,600

2,203,200

Gross margin

302,201

261,586

169,947

180,881

187,135

208,027

230,915

192,670

206,457

243,562

306,001

354,531

2,843,913

Less :Operating

Expenses

Marketing

Expense

Administrative

Expense 1,050 - - - - - 1,050 - - - - - 2,100

Pre-Operation

cost 61440 61500 61640 61680 61500 61530 61620 61500 61540 61570 61730 61480

738,730

Deprecation

5,417

5,417

5,417

5,417

5,417

5,417

5,417

5,417

5,417

5,417

5,417

5,417

64,998

Total Operating

Expense

67,907

66,917

67,057

67,097

66,917

66,947

68,087

66,917

66,957

66,987

67,147

66,897

805,828

Income before

Income taxes

234,295

194,670

102,891

113,785

120,219

141,081

162,829

125,754

139,501

176,576

238,855

287,635

2,038,085

Taxes 30% 70288 58401 30867 34135 36066 42324 48849 37726 41850 52973 71656 86290 611426

Net Income/Loss

164,006

136,269

72,023

79,649

84,153

98,756

113,980

88,027

97,650

123,603

167,198

201,344

1,426,660

Retain earning

2,975,628

3,111,897

3,183,920

3,263,569

3,347,722

3,446,479

3,560,459

3,648,486

3,746,136

3,869,739

4,036,937

4,238,282

3,993,282

Page 135: The Ladies' Shoes Co.,Ltd

P a g e | 131

5.2 Statement of Cash Flow

Cash Flow Year 1 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Cash flows from operating activity:

Cash inflow

Cash received on sales 280,292 260,128 270,635 293,492 334,639 367,890

Adjust depreciation 12,376 12,376 12,376 12,376 12,376 12,376

Other - - - - - -

Cash inflow from operating activity 292,668 272,504 283,011 305,868 347,015 380,266

Cash out flow

Purchasing inventory 142,900 142,900 142,900 142,900 142,900 142,900

Pre-operating expense 602,591 - - - - -

Administrative expense 61,100 61,220 61,360 61,340 61,440 61,540

Cash paid for income tax -161,603 13,090 16,200 23,063 35,377 45,322

Other cash expense - - - - - -

Cash out flow from operating activity: 644,988 217,210 220,460 227,303 239,717 249,762

Net cash flows from operating activity - 352,320 55,294 62,551 78,565 107,298 130,504

Cash flow from investing activity:

Cash inflow

Cash received from sold equipment

Other

Cash inflow from investing activity:

Cash outflow

Cash paid on administrative investment

Cash outflow from investment activity

Net cash flows from investing activity:

Cash flows from financing activity:

Cash inflow

Own money 2,000,000

Page 136: The Ladies' Shoes Co.,Ltd

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Cash Loan

Other

Cash inflow from financing activity 2,000,000

Cash outflow

Repayment for interest and principle loan

Cash outflow from financing activity

Net cash flows from financing activity 2,000,000

Net cash increase or decrease 1,647,680 55,294 62,551 78,565 107,298 130,504

Beginning cash 1,647,680 1,702,975 1,765,526 1,844,091 1,951,390

Ending cash 1,647,680 1,702,975 1,765,526 1,844,091 1,951,390 2,081,894

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Cash Flow Year 2 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Cash flows from operating activity:

Cash inflow

Cash received on sales 363,626

335,806

265,225

272,108

279,080

294,130

308,448

284,802

297,025

322,774

367,957

404,679

Adjust depreciation

6,189

6,188

6,188

6,188

6,188

6,188

6,188

6,188

6,188

6,188

6,188

6,188

Other -

-

-

- -

-

-

-

-

-

-

-

Cash inflow from operating activity

369,815

341,994

271,413

278,296

285,268

300,318

314,636

290,990

303,213

328,962

374,145

410,867

Cash out flow

Purchasing inventory 153,850 153,850 153,850 153,850 153,850 153,850 153,850 153,850 153,850 153,850 153,850 153,850

Pre-operating expense 1,050

-

-

- -

-

1,050

-

-

-

-

-

Administrative expense

61,540

61,590

61,640

61,440

61,500

61,500

61,640

61,620

61,510

61,440

61,490

61,600

Cash paid for income tax 42,299 34,253 13,064 15,189 17,263 21,778 25,716 18,943 22,643 30,389 43,929 54,912

Other cash expense

-

-

-

-

-

-

-

-

-

-

-

-

Cash out flow from operating activity:

258,739

249,693

228,554

230,479

232,613

237,128

242,256

234,413

238,003

245,679

259,269

270,362

Net cash flows from operating

activity

111,076

92,301

42,859

47,817

52,655

63,190

72,380

56,577

65,210

83,283

114,876

140,505

Cash flow from investing activity:

Cash inflow

Cash received from sold equipment

Other

Cash inflow from investing activity:

Cash outflow

Cash paid on administrative investment

Cash outflow from investment

activity

Net cash flows from investing activity:

Page 138: The Ladies' Shoes Co.,Ltd

P a g e | 134

Cash flows from financing activity:

Cash inflow

Own money

Cash Loan

Other

Cash inflow from financing activity

Cash outflow

Repayment for interest and principle

loan

Cash outflow from financing activity

Net cash flows from financing

activity

Net cash increase or decrease

111,076

92,301

42,859

47,817

52,655

63,190

72,380

56,577

65,210

83,283

114,876

140,505

Beginning cash

2,081,894

2,192,970

2,285,271

2,328,130

2,375,948

2,428,603

2,491,793

2,564,173

2,620,750

2,685,960

2,769,244

2,884,120

Ending cash 2,192,970

2,285,271

2,328,130

2,375,948

2,428,603

2,491,793

2,564,173

2,620,750

2,685,960

2,769,244

2,884,120

3,024,625

Page 139: The Ladies' Shoes Co.,Ltd

P a g e | 135

Cash Flow Year 3 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Cash flows from operating

activity:

Cash inflow

Cash received on sales 399,466

369,532

291,518

302,648

307,474

324,536

338,537

312,168

324,391

354,447

404,524

444,418

Adjust depreciation

6,189

6,189

6,189

6,189

6,189

6,189

6,189

6,189

6,189

6,189

6,189

6,189

Other -

-

-

-

-

-

-

-

-

-

-

-

Cash inflow from operating

activity

405,655

375,721

297,707

308,837

313,663

330,725

344,726

318,357

330,580

360,636

410,713

450,607

Cash out flow

Purchasing inventory

156,200

156,200

156,200

156,200

156,200

156,200

156,200

156,200

156,200

156,200

156,200

156,200

Pre-operating expense 1,050

-

-

-

-

-

1,050

-

-

-

-

-

Administrative expense

61,910

61,930

62,230

62,050

62,110

61,870

61,990

62,190

62,020

62,030

62,230

62,060

Cash paid for income tax 52,235

43,564

20,070

23,463

24,893

30,083

33,932

26,277

29,995

39,008

53,972

65,991

Other cash expense

-

-

-

-

-

-

-

-

-

-

-

-

Cash out flow from operating activity:

271,395

261,694

238,500

241,713

243,203

248,153

253,172

244,667

248,215

257,238

272,402

284,251

Net cash flows from

operating activity

134,260

114,027

59,207

67,124

70,460

82,572

91,554

73,690

82,365

103,398

138,311

166,356

Cash flow from investing

activity:

Cash inflow

Cash received from sold equipment

Other

Cash inflow from investing activity:

Cash outflow

Cash paid on administrative investment

Page 140: The Ladies' Shoes Co.,Ltd

P a g e | 136

Cash outflow from

investment activity

Net cash flows from investing activity:

Cash flows from financing

activity:

Cash inflow

Own money

Cash Loan

Other

Cash inflow from financing

activity

Cash outflow

Repayment for interest and

principle loan

Cash outflow from financing activity

Net cash flows from

financing activity

-

-

-

-

-

-

-

-

-

-

-

-

Net cash increase or decrease 134,260

114,027

59,207

67,124

70,460

82,572

91,554

73,690

82,365

103,398

138,311

166,356

Beginning cash

3024625

3,158,885

3,272,912

3,332,119

3,399,243

3,469,703

3,552,275

3,643,829

3,717,519

3,799,884

3,903,282

4,041,593

Ending cash

3,158,885

3,272,912

3,332,119

3,399,243

3,469,703

3,552,275

3,643,829

3,717,519

3,799,884

3,903,282

4,041,593

4,207,949

Page 141: The Ladies' Shoes Co.,Ltd

P a g e | 137

Cash Flow Year 4 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Cash flows from operating

activity:

Cash inflow

Cash received on sales

441,468

405,720

322,370

332,548

338,123

356,543

377,340

342,714

355,963

38,882

444,829

489,471

Adjust depreciation

5,417

5,417

5,417

5,417

5,417

5,417

5,417

5,417

5,417

5,417

5,417

5,417

Other

Cash inflow from operating activity

446,885

411,137

327,787

337,965

343,540

361,960

382,757

348,131

361,380

44,299

450,246

494,888

Cash out flow

Purchasing inventory 191,000 191,000 191,000 191,000 191,000 191,000 191,000 191,000 191,000 191,000 191,000 191,000

Pre-operating expense

1,050 - - - -

-

1,050

-

-

-

-

-

Administrative expense

61,280

61,440

61,480

61,500

61,460

61,580

61,730

61,440

61,280

61,500

61,550

61,720

Cash paid for income tax

54,816

44,359

19,342

22,389

24,074

29,564

35,443

25,457

29,480

-

65,710

56,059

69,400

Other cash expense

Cash out flow from operating activity:

308,146

296,799

271,822

274,889

276,534

282,144

289,223

277,897

281,760

186,790

308,609

322,120

Net cash flows from operating

activity

138,739

114,338

55,965

63,076

67,006

79,816

93,534

70,234

79,620

-

142,492

141,637

172,768

Cash flow from investing

activity: Cash inflow

Cash received from sold equipment

Other

Cash inflow from investing

activity: Cash outflow

Cash paid on administrative investment

Cash outflow from investment

activity

Page 142: The Ladies' Shoes Co.,Ltd

P a g e | 138

Net cash flows from investing

activity: Cash flows from financing

activity: Cash inflow

Own money

Cash Loan

Other

Cash inflow from financing activity

Cash outflow

Repayment for interest and principle loan

Cash outflow from financing

activity Net cash flows from financing

activity Net cash increase or decrease

138,739

114,338

55,965

63,076

67,006

79,816

93,534

70,234

79,620

-

142,492

141,637

172,768

Beginning cash 4207949

4,346,688

4,461,025

4,516,990

4,580,065

4,647,071

4,726,886

4,820,420

4,890,653

4,970,273

4,827,781

4,969,418

Ending cash

4,346,688

4,461,025

4,516,990

4,580,065

4,647,071

4,726,886

4,820,420

4,890,653

4,970,273

4,827,781

4,969,418

5,142,185

Page 143: The Ladies' Shoes Co.,Ltd

P a g e | 139

Cash Flow Year 5 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Cash flows from operating

activity:

Cash inflow

Cash received on sales

485,801

445,186

353,547

364,481

370,735

391,627

414,515

376,270

390,057

427,162

489,601

538,131

Adjust depreciation

5,417

5,417

5,417

5,417

5,417

5,417

5,417

5,417

5,417

5,417

5,417

5,417

Other

Cash inflow from operating activity

491,218

450,603

358,964

369,898

376,152

397,044

419,932

381,687

395,474

432,579

495,018

543,548

Cash out flow

Purchasing inventory 183,600 183,600 183,600 183,600 183,600 183,600 183,600 183,600 183,600 183,600 183,600 183,600

Pre-operating expense

1,050 - - - -

-

1,050

-

-

-

-

-

Administrative expense 61440 61500 61640 61680 61500 61530 61620 61500 61540 61570 61730 61480

Cash paid for income tax

70,288

58,401

30,867

34,135

36,066

42,324

48,849

37,726

41,850

52,973

71,656

86,290

Other cash expense

Cash out flow from operating

activity:

316,378

303,501

276,107

279,415

281,166

287,454

295,119

282,826

286,990

298,143

316,986

331,370

Net cash flows from operating activity

174,840

147,102

82,857

90,483

94,986

109,590

124,813

98,861

108,484

134,436

178,032

212,178

Cash flow from investing

activity: Cash inflow

Cash received from sold

equipment Other

Cash inflow from investing

activity: Cash outflow

Cash paid on administrative

investment Cash outflow from investment

activity Net cash flows from investing

Page 144: The Ladies' Shoes Co.,Ltd

P a g e | 140

activity:

Cash flows from financing

activity: Cash inflow

Own money

Cash Loan

Other

Cash inflow from financing activity

Cash outflow

Repayment for interest and principle loan

Cash outflow from financing

activity Net cash flows from financing

activity

Net cash increase or decrease

174,840

147,102

82,857

90,483

94,986

109,590

124,813

98,861

108,484

134,436

178,032

212,178

Beginning cash 5142185

5,317,025

5,464,126

5,546,983

5,637,465

5,732,451

5,842,040

5,966,853

6,065,713

6,174,197

6,308,632

6,486,664

Ending cash 5,317,025

5,464,126

5,546,983

5,637,465

5,732,451

5,842,040

5,966,853

6,065,713

6,174,197

6,308,632

6,486,664

6,698,841

Page 145: The Ladies' Shoes Co.,Ltd

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5.3 Balance Sheet

Year 1 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Asset

Current asset

Cash 647,680 702,975 765,526 844,091 951,390 1,081,894 237,339

Inventory 12,300 39,490 61,590 72,840 64,900 40,900 292,020

Other current asset

Total current asset 659,980 742,465 827,116 916,931 1,016,290 1,122,794 5,285,576

Fixed asset

Equipment fixed

asset

647,551

621,787

607,334

617,458

671,398

761,290

3,926,818

Total Fixed asset

647,551

621,787

607,334

617,458

671,398

761,290

3,926,818

Total asset

1,307,531

1,364,252

1,434,450

1,534,389

1,687,688

1,884,084

9,212,394

Liability and Equity

Liability

Long term note

payable

Other

Total liability

Equity

Retain earning - 692,469 - 635,748 - 565,550 - 465,611 - 312,312 - 115,916 - 115,916

Owner equity 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 12,000,000

Total owner equity

1,307,531

1,364,252

1,434,450

1,534,389

1,687,688

1,884,084

9,212,394

Total liability and

equity

1,307,531

1,364,252 1,434,450

1,534,389

1,687,688

1,884,084

9,212,394

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Year 2 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Asset

Current asset

Cash

1,192,970

1,285,271

1,328,130

1,375,948

1,428,603

1,491,793

1,564,173

1,620,750

1,685,960

1,769,244

1,884,120

2,024,625

18,651,587

Inventory

40,910

38,040

67,590

94,390

117,040

132,940

143,060

164,660

173,139

178,624

163,148

130,400

1,443,941

Other current asset

1,233,880

1,323,311

1,395,720

1,470,338

1,545,643

1,624,733

1,707,233

1,785,410

1,859,099

1,947,868

2,047,268

2,155,025

20,095,528

Total current asset

Fixed asset

748,902

739,395

697,469

658,292

623,266

594,991

572,494

538,518

517,663

499,801

502,901

523,273

7,216,965

Equipment fixed

asset

748,902

739,395

697,469

658,292

623,266

594,991

572,494

538,518

517,663

499,801

502,901

523,273

7,216,965

Total Fixed asset

1,982,782

2,062,706

2,093,189

2,128,630

2,168,909

2,219,724

2,279,727

2,323,928

2,376,762

2,447,669

2,550,169

2,678,298

27,312,493

Total asset

Liability and Equity

Liability

Long term note

payable

Other

Total liability

Equity

Retain earning

-

17,218

62,706

93,189

128,630

168,909

219,724

279,727

323,928

376,762

447,669

550,169

678,298

715,162

Owner equity

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

24,000,000

Total owner equity

1,982,782

2,062,706

2,093,189

2,128,630

2,168,909

2,219,724

2,279,727

2,323,928

2,376,762

2,447,669

2,550,169

2,678,298

27,312,493

Total liability and

equity

1,982,782

2,062,706

2,093,189

2,128,630

2,168,909

2,219,724

2,279,727

2,323,928

2,376,762

2,447,669

2,550,169

2,678,298

27,312,493

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Year 3 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Asset

Current asset

Cash

2,158,885

2,272,912

2,332,119

2,399,243

2,469,703

2,552,275

2,643,829

2,717,519

2,799,884

2,903,282

3,041,593

3,207,949

31,499,193

Inventory

133,830

117,580

137,160

152,030

147,685

167,820

166,280

177,550

182,890

173,790

141,390

101,370

1,799,375

Other current asset

Total current asset

2,292,715

2,390,492

2,469,279

2,551,273

2,617,388

2,720,095

2,810,109

2,895,069

2,982,774

3,077,072

3,182,983

3,309,319

33,298,568

Fixed asset

Equipment fixed

asset

544,329

548,201

516,243

488,996

480,963

448,450

437,612

413,964

396,246

392,968

412,990

440,633

5,521,595

Total Fixed asset

544,329

548,201

516,243

488,996

480,963

448,450

437,612

413,964

396,246

392,968

412,990

440,633

5,521,595

Total asset

2,837,044

2,938,693

2,985,522

3,040,269

3,098,351

3,168,545

3,247,721

3,309,033

3,379,020

3,470,040

3,595,973

3,749,952

38,820,163

Liability and Equity

Liability

Long term note

payable

Other

Total liability

Equity

Retain earning

Owner equity

837,044

938,693

985,522

1,040,269

1,098,351

1,168,545

1,247,721

1,309,033

1,379,020

1,470,040

1,595,973

1,749,952

14,820,163

Total owner equity

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

24,000,000

Total liability and

equity

2,837,044

2,938,693

2,985,522

3,040,269

3,098,351

3,168,545

3,247,721

3,309,033

3,379,020

3,470,040

3,595,973

3,749,952

38,820,163

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Year 4 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Asset

Current asset

Cash

3,346,688

3,461,025

3,516,990

3,580,065

3,647,071

3,726,886

3,820,420

3,890,653

3,970,273

3,827,781

3,969,418

172,768

40,930,038

Inventory

73,800

110,880

150,730

210,190

242,370

266,150

281,790

313,690

339,180

348,760

332,350

294,320

2,964,210

Other current asset

Total current asset

3,420,488

3,571,905

3,667,720

3,790,255

3,889,441

3,993,036

4,102,210

4,204,343

4,309,453

4,176,541

4,301,768

467,088

43,894,248

Fixed asset

Equipment fixed

asset

330,541

282,629

231,945

161,652

118,639

84,026

57,553

14,820

-

21,504

-

41,916

-

36,339

3,960,275

5,142,321

Total Fixed asset

330,541

282,629

231,945

161,652

118,639

84,026

57,553

14,820

-

21,504

-

41,916

-

36,339

3,960,275

5,142,321

Total asset

3,751,029

3,854,534

3,899,665

3,951,907

4,008,080

4,077,062

4,159,763

4,219,163

4,287,949

4,134,625

4,265,429

4,427,363

49,036,569

Liability and Equity

Liability

Long term note

payable

Other

Total liability

Equity

Retain earning

Owner equity

1,751,029

1,854,534

1,899,665

1,951,907

2,008,080

2,077,062

2,159,763

2,219,163

2,287,949

2,134,625

2,265,429

2,427,363

25,036,569

Total owner equity

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

24,000,000

Total liability and

equity

3,751,029

3,854,534

3,899,665

3,951,907

4,008,080

4,077,062

4,159,763

4,219,163

4,287,949

4,134,625

4,265,429

4,427,363

49,036,569

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Year 5 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Asset

Current asset

Cash

4,317,025

4,464,126

4,546,983

4,637,465

4,732,451

4,842,040

4,966,853

5,065,713

5,174,197

5,308,632

5,486,664

5,698,841

59,240,990

Inventory

250,200

226,070

243,930

257,340

266,810

266,720

257,680

266,590

268,900

253,240

208,760

140,560

2,906,800

Other current asset

Total current asset

4,567,225

4,690,196

4,790,913

4,894,805

4,999,261

5,108,760

5,224,533

5,332,303

5,443,097

5,561,872

5,695,424

5,839,401

62,147,790

Fixed asset

Equipment fixed

asset

24,144

37,442

8,748

-

15,495

-

35,798

-

46,540

-

48,333

-

68,076

-

81,220

-

76,392

-

42,746

14,622

-

34,510,787

Total Fixed asset

24,144

37,442

8,748

-

15,495

-

35,798

-

46,540

-

48,333

-

68,076

-

81,220

-

76,392

-

42,746

14,622

-

34,510,787

Total asset

4,591,369

4,727,638

4,799,661

4,879,310

4,963,463

5,062,220

5,176,200

5,264,227

5,361,877

5,485,480

5,652,678

5,854,023

27,637,003

Liability and Equity

Liability

Long term note

payable

Other

Total liability

Equity

Retain earning

Owner equity

2,591,369

2,727,638

2,799,661

2,879,310

2,963,463

3,062,220

3,176,200

3,264,227

3,361,877

3,485,480

3,652,678

3,854,023

3,637,003

Total owner equity

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

2,000,000

24,000,000

Total liability and

equity

4,591,369

4,727,638

4,799,661

4,879,310

4,963,463

5,062,220

5,176,200

5,264,227

5,361,877

5,485,480

5,652,678

5,854,023

61,818,146

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Year 0 CF1 CF2 CF3 CF4 CF5

Initial investment - 2,000,000

Net Cash Flow

2,000,000

2,081,894

3,024,625 4,207,949

5,142,185

6,698,841

Net income

- 66,621

794,214 1,034,790

1,049,239

1,426,660

Average net

income

847,656

Average Book

Value

1,000,000

Average cost 1,814,640

Average sale

3,883,896

NPV =

฿11,160,659

Play back period = Within 1 year

IRR =

118% 13,134,999

ROI =

114%

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Chapter 6 Risk Management

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Chapter 6

Risk Management

6.1 External Risk

External risk is the situation that company unable to control. For instance,

changing of economy, social political and technology that has to compete about

customer need and competitors.

6.1.1 Economic condition

According to economy recession since 2006 that influenced to

customer‘s trust and consuming was generally decreased. Although the index

number of customer‘s trust will increase and expects that the consuming will be

better at the beginning of 2008. But there is the problem of lack of political in

Thailand and not stability. Another problem is the recession of economy in

United States including higher of petroleum oil price which are main deficit

factors to economy in Thailand. Therefore, the lack of economy recession will

affect to rack rent and the amount of customers. However, we should drive our

business attentively and our company still able to drive the business fluently.

6.1.2 Competitive Condition

The competitive condition of retail business depends on location and the

main customer‘s base in this location which is two factors that so important to

attracts customers even though situation in Thailand still lack of economy.

Central department store is a community mall that will opening at Chiang Rai

soon and this is one of direct competitor for our company which has target group

in urban area so they may also attract our target group. And a community mall

in department store will increase the location for retail store that will affect to

compete in retail business. However, a community mall has to limit the amount

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of retail shop and limit type of shop because they have to fulfill what customers

want for their business.

6.1.3 Changing in Technology

Changing of technology could affect our business. Much retail online

shop on the internet could influence to our customers because our target group is

university students and the most of them usually use the internet for update

fashion. If they prefer to order the products on the internet so it will become to

our competitors indirectly. Moreover, they will appear and reduce the demand

for our services. The examples of online shops that will take an affect to our

business are http://www.weloveshopping.com/,

http://siambrandname.com/forum/ and other retail shops including the aboard

website.20

6.1.4 Changing Customer need

Nowadays, the internet has an influence to life style very common such

as social, culture, political technology and economy which the changing of these

are affect to what customer wants and customers behavior so that is s reason of

risk. Customers have many choices to buy products. Many competitors have an

effort to attract customers by product differentiation. Changing customer need

especially fashion is simply fade and the latest fashion increasingly change. It

will take a risk when order products and take into a consideration to order them.

The popular of fashion in each country that different to each other quite diversity

and fashion products have many type of this so it quite complicated to know that

what customers want. 21

20

http://www.accasa.com/article/market14.html

21 http://ba.bu.ac.th/ejournal/MK/MK5_1/MK5_1.htm

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6.2 Internal Risk

Internal risks are essentially within your control, provided you have the aptitude

and attention to detail to exercise it. Such risks could include:

6.2.1 Stock

Do you have the intuition to stock the right items, the hot sellers, or

might you end up with shelves of unwanted items?

Solution

When our shop will buy our shoes each time we will learn about shoes

fashion in that time and check about code and size of shoes each time before we

will order every time. Moreover, we will consultation with supplier of shoes

every time in order to obtain correct shoes that we want. And our shop deal with

suppler for send goods on time for not late and for reduce time to delivery.

6.2.2 The risk of operation management

May be Sometime manager or employees have confused about operation

in shop. So, we will divide about work in each person to distinct and manager

has the most responsibility to manage in employee and operation in shop. 22

6.2.3 Financial risk

Financial management is varying important. It needs to be managing

with circumspection, because the financial risk can affect the operations of our

business.

22

http://www.site4business.com/index.php/entrepreneurresources/buy-business-articles/9-buy-business-

risk

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Decrease in sale

If the company‘s total sale decrease by 5%, it will affect to our company‘s

income statement as follow:

Sale decrease by 5% year1 year2 year3 year4 year5

Revenue 1,716,722 3,605,877 4,382,341.95 4,033,672.45 4,794,757.35

Less :Cost of goods sold 857,400 1,846,200 1,874,400 2,292,000 2,203,200

Gross margin 859,322 1,759,677 2,507,942 1,741,672 2,591,557

Less :Operating Expenses

Marketing Expense - 2,100 2,100 2,100 2,100

Administrative Expense 368,000 466,698 744,620 737,960 738,730

Pre-Operation cost 601,516

Deprecation 74,258 74,258 74,268 64,998 64,998

Total Operating Expense 1,043,774 543,056 820,988 805,058 805,828

Income before Income taxes - 184,452 1,216,621 1,686,954 936,614 1,785,729

Taxes 30% - 55,336 364,986 506,086 280,984 535,719

Net Income/Loss - 129,116 851,635 1,180,868 655,630 1,250,011

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If the company‘s total sale decrease by 10%, it will affect to our company‘s

income statement as follow:

Sale decrease by 10% year1 year2 year3 year4 year5

Revenue 1,626,368.40 3,416,094 3,756,293 3,821,373.90 4,542,401.70

Less :Cost of goods sold 857,400 1,846,200 1,874,400 2,292,000 2,203,200

Gross margin 768,968 1,569,894 1,881,893 1,529,374 2,339,202

Less :Operating Expenses

Marketing Expense - 2,100 2,100 2,100 2,100

Administrative Expense 368,000 466,698 744,620 737,960 738,730

Pre-Operation cost 601,516

Deprecation 74,258 74,258 74,268 64,998 64,998

Total Operating Expense 1,043,774 543,056 820,988 805,058 805,828

Income before Income taxes - 274,806 1,026,838 1,060,905 724,316 1,533,374

Taxes 30% - 82,442 308,051 318,272 217,295 460,012

Net Income/Loss - 192,364 718,787 742,634 507,021 1,073,362

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If the company‘s total sale decrease by 15%, it will affect to our company‘s

income statement as follow:

Sale decrease by 15% year1 year2 year3 year4 year5

Revenue 1,536,015 3,226,311 3,547,610.15 3,609,075.35 4,290,046.05

Less :Cost of goods sold 857,400 1,846,200 1,874,400 2,292,000 2,203,200

Gross margin 678,615 1,380,111 1,673,210 1,317,075 2,086,846

Less :Operating Expenses

Marketing Expense - 2,100 2,100 2,100 2,100

Administrative Expense 368,000 466,698 744,620 737,960 738,730

Pre-Operation cost 601,516

Deprecation 74,258 74,258 74,268 64,998 64,998

Total Operating Expense 1,043,774 543,056 820,988 805,058 805,828

Income before Income taxes - 365,159 837,055 852,222 512,017 1,281,018

Taxes 30% - 109,548 251,117 255,667 153,605 384,305

Net Income/Loss - 255,612 585,939 596,556 358,412 896,713

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Increase in cost/expense

If the company‘s cost/expense increases by 5%, it will affect to our company‘s

net income as follow

Cost increase by 5% year1 year2 year3 year4 year5

Revenue

1,807,076

3,795,660

4,173,659

4,245,971

5,047,113

Less :Cost of goods

sold

900,270

1,938,510

1,968,120

2,406,600

2,313,360

Gross margin

906,806

1,857,150

2,205,539

1,839,371

2,733,753

Less :Operating

Expenses

Marketing Expense

2,100

2,100

2,100

2,100

Administrative

Expense

368,000

466,698

744,620

737,960

738,730

Pre-Operation cost

601,516

Deprecation

74,258

74,258

74,268

64,998

64,998

Total Operating

Expense

1,043,774

543,056

820,988

805,058

805,828

Income before Income

taxes

-

136,968

1,314,094

1,384,551

1,034,313

1,927,925

Taxes 30% -

41,090

394,228

415,365

310,294

578,378

Net Income/Loss -

178,058

919,866

969,186

724,019

1,349,548

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If the company‘s cost/expense increases by 10%, it will affect to our company‘s

net income as follow

Cost increase by 10% year1 year2 year3 year4 year5

Revenue

1,807,076

3,795,660

4,173,659

4,245,971

5,047,113

Less :Cost of goods

sold

943,140

2,030,820

2,061,840

2,521,200

2,423,520

Gross margin

863,936

1,764,840

2,111,819

1,724,771

2,623,593

Less :Operating

Expenses

Marketing Expense

368,000

2,100

2,100

2,100

2,100

Administrative

Expense

601,516

466,698

744,620

737,960

738,730

Pre-Operation cost

74,258

Deprecation

1,043,774

74,258

74,268

64,998

64,998

Total Operating

Expense

543,056

820,988

805,058

805,828

Income before Income

taxes

-

100,634

1,221,784

1,290,831

919,713

1,817,765

Taxes 30% -

30,190

366,535

387,249

275,914

545,330

Net Income/Loss -

130,824

855,249

903,582

643,799

1,272,436

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If the company‘s cost/expense increases by 15%, it will affect to our company‘s

net income as follow

Cost increase by 15% year1 year2 year3 year4 year5

Revenue

1,807,076

3,795,660

4,173,659

4,245,971

5,047,113

Less :Cost of goods

sold

986,010

2,123,130

2,155,560

2,635,800

2,533,680

Gross margin

821,066

1,672,530

2,018,099

1,610,171

2,513,433

Less :Operating

Expenses

Marketing Expense

368,000

2,100

2,100

2,100

2,100

Administrative

Expense

601,516

466,698

744,620

737,960

738,730

Pre-Operation cost

74,258

Deprecation

1,043,774

74,258

74,268

64,998

64,998

Total Operating

Expense

543,056

820,988

805,058

805,828

Income before Income

taxes

-

57,764

1,129,474

1,197,111

805,113

1,707,605

Taxes 30% -

17,329

338,842

359,133

241,534

512,282

Net Income/Loss -

75,093

790,632

837,978

563,579

1,195,324

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Chapter 7 Summary

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Chapter 7

Summary

7.1 Background and Reason

Shoes are the device used to wear for walking. Its benefit is to prevent our foot

from contacting with various sharp objects. However, in view of other people who love

fashion, shoes are important accessories indispensable to show the identity of their

wearer especially the girls who love new fashion. Nowadays, shoes‘ store in front of

Mae Fah Luang University and Chiang Rai Rajabhat University has not much. In these

areas is not much progress yet, having few and small shops that not enough to encounter

with a lot of students. Therefore, we would like to offer them the better way adding

convenience and cost saving by opening a fashion shoes shop with a large collection of

good quality and cheap price shoes for students in major. In addition, this benefit also

causes to other people such as officers, and other occupations who love to keep up with

fashion.

7.2 Product and Service

There are a lot of women‘s shoes in our shop which are divided into categories

based on quality and price. We offer large selections of fashioned high heel shoes, basic

shoes, platform shoes, and etc. which came from the big stores and market in Bangkok

where a fashion city is and also importing the shoes from Korea and Hong Kong by

ordering the mass, through the website. In a good costume, clothing must be

corresponding with shoes. The best selection of shoes not only makes the wearer look

good, but also cause good personality and health as well. The Ladies‘ Shoes, we provide

guide service to all customers by our well-trained employees who have knowledge of

fashion and personality development.

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7.3 Marketing

Marketing Mix

Product

The Ladies‘ Shoes offer large selections of fashioned footwear which

made from good quality materials such as leather and rubber, produced and

distributed from creditable company. Our products are classified into five

categories which based on quality and price. These five categories consist of

basic shoes, cut shoes, platform shoes, high heel shoes, and imported high heel

shoes.

Price

The Ladies‘ Shoes focus on the affordability of target customers who are

almost student. We use Leading price strategy – set the price as pleased

regardless the competitors how much will them set, no comparison. Thus, our

price will be cheaper than competitors.

Place

The Ladies‘ Shoes has 2 retail stores of fashion shoes locate at in front of

Mae Fah Luang University and in front of Chiang Rai Rajabhat University.

Promotion

The Ladies‘ Shoes use Vinyl poster to inform customers about our

information such as shop‘s name, shop‘s location, and what‘s new. The sale

promotion that The Ladies‘ Shoes offer to customers is Discount. 10 – 50%

discounts depend on different festivals such as Shop‘s Birthday, Christmas day,

New Year, Valentine‘s Day, and school opening period.

7.4 Production Process

Our business is a kind of retail business about women‘s fashion shoes. So, we

need to buy the shoes from manufacturers, wholesalers or other shoes stores to retail sell

again to the customers. Our business has suppliers who are the finder and provider of

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products to our stores which they have two methods to find the products, first they go to

find and buy the products by themselves at Bangkok along the shopping areas by using

company‘s truck. Second, they find the product via the internet and select to buy the

product from websites.

7.5 Management Analysis

The Ladies‘ Shoes is small organization. Our organization management is an

informal organization structure that one person can do many functions that they can do.

We have to manage stock well because fashion products are out of date so quickly.

First-in first-out is the strategy that will use for manage our organization. We have all

six workers which consist of one manager, two cashiers, two sale representatives and

one supplier. Each department is responsible more over one task such as cashier can

help the sale representative to sell the product. So they have to learn the others tasks and

can help to take care of shop as well.

7.6 Risk Management

Risk can happen with every entrepreneur. The risk that The Ladies‘ Shoes is

high to face are possibly economic recession and changing in customer need. Because

of our business is fashion which change frequently and rapidly. Customers have many

choices to buy products. Many competitors have an effort to attract customers by

product differentiation. Not only those, the important risk for business is financial risk,

how the business can control cost, motivate the sale, and receive high profit or prevent

from lost. The manager of company should be the one who is creditable can control

financial well.

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Reference

http://en.wikipedia.org/wiki/Shoes

http://pcoc.moc.go.th/wappPCOC/views/dfactsheet.aspx?pv=57

http://www.klangcri.com/team/team3/data/econemy/2553/1.%20Oct%202552.pdf

http://www.shoeinfonet.com/about%20shoes/history/history%20your%20shoes/history

%20your%20shoes.htm

http://www.ryt9.com/s/oie/1053093

http://shoes4sales.blog.com/2010/10/16/%E0%B8%81%E0%B8%B2%E0%B8%A3%E

0%B8%9A%E0%B8%A3%E0%B8%B4%E0%B9%82%E0%B8%A0%E0%B8%84%

E0%B9%80%E0%B8%AA%E0%B8%B7%E0%B9%89%E0%B8%AD%E0%B8%9C

%E0%B9%89%E0%B8%B2%E0%B9%81%E0%B8%9F%E0%B8%8A%E0%B8%B1

%E0%B9%88/

http://www.ttisfashionbiz.com/component/content/article/19-fashion-accessories/514-

ciisiosfisisffleather.html

http://www.wholesale-dress.net/women-s-wedges-c2125

http://www.wholesale-dress.net/women-s-pumps-c2122

http://www.corehoononline.com/index.php?option=com_multisitescontent&view=articl

e&id=175:--1---&catid=20:2010-03-19-04-30-28&Itemid=25&site_id=Corehoon

http://www.thaipr.net/nc/readnews.aspx?newsid=2206EFD51ED25CE09046C3242B25

67A1&sec=all&query=U3Ryb25nIFRoYWlsYW5kIDIwMTJUaGFpIEtoZW0gS2hhZ

W5n

http://pcoc.moc.go.th/wappPCOC/views/dfactsheet.aspx?pv=57

http://www.klangcri.com/team/team3/data/econemy/2553/1.%20Oct%202552.pdf

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http://www.theinsider.com/news/2193013_Shoe_fashion_trends_for_Fall_2009_Winter

_2010

http://www.smashingmagazine.com/2010/09/27/fashion-websites-trends-interviews-

showcase/

http://en.wikipedia.org/wiki/Advertising

http://reg.mfu.ac.th/registrar/statistics/RepStudent1.asp?acadyear=2553&maxsemester=

2&semester=2

http://en.wikipedia.org/wiki/Advertising

http://www.davedolak.com/promo.htm

http://www.logisticsworld.com/logistics.htm

http://www.logisticsworld.com/logistics.htm

http://www.cmusedcar.com/%E0%B8%95%E0%B9%89%E0%B8%AD%E0%B8%87

%E0%B8%81%E0%B8%B2%E0%B8%A3%E0%B8%82%E0%B8%B2%E0%B8%A

2%E0%B8%A3%E0%B8%96%E0%B8%81%E0%B8%A3%E0%B8%B0%E0%B8%9

A%E0%B8%B0%E0%B8%9A%E0%B8%A3%E0%B8%A3%E0%B8%97%E0%B8%

B8%E0%B8%81%E0%B8%94%E0%B9%88%E0%B8%A7%E0%B8%99/M3853.htm

l

http://www.accasa.com/article/market14.html

http://ba.bu.ac.th/ejournal/MK/MK5_1/MK5_1.htm

http://www.site4business.com/index.php/entrepreneurresources/buy-business-articles/9-

buy-business-risk

http://www.mea.or.th/tariffbywork.htm

http://www.homeandi.com/content/c1295.html

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Appendix

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Company Limited Registration

According to the Civil and Commercial Code

Company Limited

Is that kind of company which is formed with a capital divided into egual shares, the

liability of the shareholders being limited to the amount unpaid on the shares

respectively held by them.

Establishment of Company Limited

To establish the company limited, shall process according to the following :

1. Must have at least 3 persons signing together in order to prepare Memorandum and

then register. Upon receiving the amount of shares, the director must register as the

company within 3 months from the date of company‘s meeting to establish the

company.

The promoters must have the following qualifications :

(1) Be ordinary person, not juristic person

(2) Be 12 years old or more

(3) Must reserve to buy at least 1 share

Information used to register the Memorandum

(1) Company‘s name (the same as the name reserved)

(2) Location of head office (located at which province)

(3) Objective of the company

(4) Registered capital must be divided into each share with the same value

(share‘s value must be at least 5 Baht)

(5) Name, address, age, occupation and number of shares that persons who start

up the company reserve to buy the shares)

(6) Name, address, age of 2 witnesses

2. When the Memorandum has been registered, shall perform the following:

(1). every promoter manages to reserve and buy all the shares

(2). When all the shares are reserved, the promoters must with out delay hold a

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general meeting of subscribers which shall be called the statutory meeting.

3. Meeting agenda.

(1) The adoption of the regulations of the company, if any.

(2) The ratification of any contracts entered into and any expenses incurred by

the promoters in promoting the company.

(3) The fixing of the amount, if any, to be paid to the promoters.

(4) The fixing of the number of preference shares, if any, to be issued, and the

nature and extent of the preferential rights accruing to them.

(5) The fixing of the number of ordinary shares or preference shares to be

allotted as fully or partly paid-up otherwise than in money, if any, and the amount up to

which they shall be considered as paid-up.

The description of the services or property in return for which such ordinary

shares or preference shares shall be allotted as paid-up shall be expressly laid down

before the meeting

(6) The appointment of the first directors and auditors and the fixing of their

respective powers.

No resolutions of the statutory meeting are valid unless passed by a majority

including at least one half of the total number of subscribers entitled to vote, and

representing at least one half of the total number of shares to such subscribers.

4. The promoters shall over the business to the directors.

5. The directors shall the respond cause the promoters and subscribers to pay forth

with upon each share payable in money such amount, not less than twenty-five percents

of the share's value.

6. When the collection of share‘s price is complete, the authorized director shall

prepare the request for the registration of company‘s establishment and submit to the

registrar.

Regarding the submission for registration, the authorized director shall sign the

name on the request and must submit to register within 3 months from the date of

company statutory meeting. If not registered within the specified period, the company

statutory meeting shall be void and if would like to register to establish the company,

shall arrange the meeting for persons who reserve to buy the shares again.

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3. Regarding the company establishment, if can perform every step as follows within

the same day that the promoters prepare the Memorandum, and the director can request

to register the Memorandum and register the company within the same day.

(1) Shall have the persons reserve to buy all the shares that the company can be

registered.

(2) Arrange the meeting to establish the company to consider various affairs

according to the Civil and Commercial Code, section 1108, and all the persons who

start up the company and all the persons who reserve to buy the shares shall attend the

meeting, and all of them shall agree in the affairs in the meeting.

(3) Persons who start up the company assign all the affairs to the director.

(4) The director call the person who reserves to buy the shares to pay the shares

according to the Civil and Commercial Code, section 1110, section 2 and such share‘s

price has already been paid.

Registration

the Company limited‘s registration shall be divided into 2 steps as follows:

1. Registering the Memorandum.

2. Registering the company limited‘s establishment

The registration of the modification / change or liquidation of the company limited

In case that the company limited agrees to modify or change any registered

transactions or the shareholders would like to liquidate the business, shall request for

the registration of the modification / change of such transactions or registration of the

company‘s liquidation at the company and partnership registration office that the head

office of the company is located on.

The registration to establish and modify any transactions shall be performed according

to the method and criteria specified by the law and the government‘s rules.

Registered Transaction that the Company has to register to Modify or Change

1. The modification or changing of memorandum before the company‘s

establishment.

2. Extraordinary resolution to

(1) Increase capital

(2) Decrease capital

(3) Merge the company

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3. The Company‘s merger.

4. The modification or change of memorandum of association after the company‘s

establishment

5. Capital increase

6. Capital decrease

7. Regulation‘s modification

8. Director

9. Number or name of authorized directors

10. Location of head office and / or branches

11. Company‘s seal

12. Other transactions that should be publicized

Place for Registration (the same as partnership)

Registration Procedure

1.Submit in person can perform according to the following :

(1) In case of registering for the establishment or changing the company‘s name,

the persons who start up the company or company‘s director shall request for verifying

and reserving the company‘s name to confide that such name is not duplicated or

similar to other names pervious registered. Upon reserving the name, shall request for

the registration of memorandum of association within 30 days by reserving the name in

person or via internet at www.dbd.go.th .

(2) Purchase the request and form from the Department of Business

Development or any of 7 business development office or provincial business

development office or download from internet from www.dbd.go.th .

(3) Prepare the request for registration and other attachments to the registrar for

consideration.

(4) Pay the fee according to the officer‘s order

(5) If aiming to issue the certificate of registered transactions, shall submit the

request and pay the fee to the officers.

(6) Receive the certificate of registration.

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2. Steps for registering partnership and company via internet (see the steps in

partnership)

Criteria of Signing the Signature on the Request for Registration

(1) The signature in the request and the attachments, the person shall sign by him /

herself.

(2) The signature in the request, the person shall sign in front of the registrar and

demonstrate the ID card to the registrar for verification.

In case that the person cannot sign the name in front of the registrar, the person who

request shall sign the name in front of the following person :

2.1 In case of signing in the country

(1) Administration Officer or Senior Police in the area of the person who

requests.

(2) Member of Thai BAR or

(3) Other persons as notified by the central registrar are

- Certified Public Account

- Committee member or officer of the Thai chamber of commerce or

provincial chamber of commerce who can certify the signature of persons who request

for the registration of partnership / company with the head office located in the province

that the Chamber is located according to the notification of the Central Partnership

Registration Office.

2.2 In case of signing in foreign countries

(1) Authorized officer of the Thai embassy or consulate, or head of the office

under the Minister of Commerce responsible for the operations in any country or other

officers authorized to perform on behalf of such abovementioned person

(2) Person who can completely certify according to the law of that country and

(3) 2 Reliable persons who can certify in front of the registrar that the signature

is such person‘s signature.

Duties of Company

(1) The company limited must prepare the financial statement once a month in every

12 months and at least one auditor shall audit to propose to the ordinary shareholder‘s

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meeting to approve the financial statement within 4 months from the closing date, and

submit the financial statement to the business information service office, department of

business development, or any provincial business development office within 1 month

from the date of financial statement‘s approval although such businesses have not yet

been started or have not ceased temporarily; otherwise, they shall have the fine penalty

of no more than 50,000 Baht.

(2) The director shall prepare the copy of list of all shareholders‘ names that are

holding the share at the time of the annual shareholders‘ meeting and the list of persons

who are not the shareholders from the date of the last shareholders‘ meeting and submit

to the department of business development or any provincial business development

office within 14 days from the date of the meeting; otherwise, they shall have the fine

penalty of no more than 10,000 Baht.

(3) Must arrange the annual shareholders‘ meeting within 6 months from the juristic

person‘s registration date, and arrange the next meeting of at least one time for every 12

months; otherwise, they shall have the fine penalty of no more than 20,000 Baht.The

invitation for the shareholders‘ meeting shall be advertised on the local newspaper for at

least one time of at least 7 days before the meeting date, and shall send via reply mail to

every shareholder named in the company‘s registration for at least 7 days before the

meeting date, except the invitation for the shareholders‘ meeting to vote for the

extraordinary resolution shall be sent for at least 14 days before the meeting date.

(4) Must prepare share certificate to the company‘s shareholders; otherwise, they

shall have the fine penalty of no more than 10,000 Baht.

(5) Must prepare the book of shareholders‘ registration of the company; otherwise,

they shall have the fine penalty of no more than 20,000 Baht.

(6) Any companies that relocate the location of head office must request for the

registration to the registrar; otherwise, they shall have the fine penalty of no more than

20,000 Baht.

In case that the juristic person does not submit the yearly financial statement as

specified by the law, such juristic person has offense, and the managing director or

authorized director on behalf of the juristic person shall also have the offense too.

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Businesses that the Law specifies the period of time of submitting the registration

1) Request for registering the company‘s establishment shall be submitted within 3

months from the date of company‘s establishment.

2) Request for registering the appointment of new directors or the resignation of

directors shall be submitted within 14 days from the date of appointment or date of

resignation

3) Request for registering the extraordinary resolution of capital increase or capital

decrease of the company limited or the company‘s merger shall be submitted within 14

days from the extraordinary resolution date

4) Request for registering the new regulation or modification of the company

limited‘s regulation must be submitted with 14 days from the extraordinary resolution

date

5) Request for registering the company‘s merger shall be submitted within 14 days

from the date of merger

6) Request for registering the company‘s liquidation shall be submitted within 14

days from the liquidation date

7) Request for registering the change of liquidator shall be submitted within 14 days

from the date of change

8) Request for registering the modification of liquidator‘s authority shall be

submitted within 14 days from the date that the meeting has the resolution or the court

has the decision

9) Request for registering the completeness of the company‘s liquidation shall be

submitted within 14 days from the date that the meeting has the resolution

10) The submission of the report of partnership‘s liquidation shall be submitted

every 3 months and the liquidator shall submit the report within 14 days from the date

that the 3-month period expires.

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Fee Rate for Registering Company Limited

Registration Company Limited Baht

1. Registering the memorandum of association 500.-

1.1 Registered capital of no more than 1,000,000

Baht 50.-

1.2 Every 100,000 Baht of the increase of

registered capital

(fraction of 100,000 Baht shall be counted as

100,000 Baht)

50.-

1.3 Registered capital of more than 50,000,000

Baht 25,000.-

2. Register for company limited‘s establishment 5,000.-

2.1 Registered capital of no more than 1,000,000

Baht 500.-

2.2 Every 100,000 Baht of the increase of

registered capital

(fraction of 100,000 Baht shall be counted as

100,000 Baht)

500.-

2.3 Registered capital of more than 50,000,000

Baht 250,000.-

3. Registering the company‘s merger 5,000.-

4. Registering the medication 250,000.-

4.1 Registering the extraordinary resolution

(capital increase / capital decrease / company‘s

merger)

400.-

4.2 Registering the capital increase

(calculate according to every 100,000 Baht of

the increase)

500.-

(Increase for more than 50,000,000 Baht) 250,000.-

4.3 Registering the capital decrease 400.-

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4.4 Registering the modification of every clause of

the memorandum

of association

400.-

4.5 Registering the modification of every clause of

the regulation 400.-

4.6 Registering for new directors per

person 400.-

4.7 Registering for partners‘ resignation (no limit) 400.-

4.8 Registering the modification of directors‘

authority 400.-

4.9 Registering the change of location of head

office and / or branches 400.-

4.10 Registering the modification of seal 400.-

4.11 Register other transactions that should be

publicized 400.-

5. Registering the company‘s liquidation 400.-

6. Registering the change of liquidators 400.-

7. Registering the modification of liquidator‘s power

and authority 400.-

8. Registering the modification of liquidation office 400.-

9. Registering the completeness of liquidation 400.-

Source: (development 2010)

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อตราการช าระภาษปาย

ปาย หมายความวา ปายแสดงชอ ยหอ หรอเครองหมายทใชในการประกอบการคา หรอประกอบกจการอน ๆเพอหารายได หรอโฆษณาการคา หรอกจการอนเพอหารายได ไมวาจะแสดงหรอโฆษณาไวทวตถใดๆ ดวยอกษร ภาพหรอเครองหมายทเขยน แกะสลก จารก หรอท าใหปรากฏดวยวธอน ขนตอนการช าระภาษปาย 1. การยนแบบแสดงรายการเพอเสยภาษ การ ยนแบบแสดงรายการเพอเสยภาษ ผเปนเจาของปายหรอผครอบครองปายจะตองยนแบบ ภ.ป.1 ภายในวนท 31 มนาคม ของทกป กรณทตดตงปายใหมหรอเปลยนแปลงขอความของปาย จะตองยนแบบ ภ.ป.1 ภายใน 15 วน นบแตวนทตดตงใหม หรอทเปลยนแปลงขอความของปายใหม 2. การช าระเงนคาภาษ 2.1 ผเปนเจาของปายหรอผครอบครองปายตองช าระคาภาษ ภายใน 15 วน นบแตวนทไดรบแจงการประเมน 2.2 กรณทเจาของปายยนแบบ (ภ.ป.1) แสดงรายการไวถกตองครบถวนและพนกงานเจาหนาทไดตรวจสอบแลวถกตอง จะแจงการประเมนและช าระภาษในวนทยนแบบฯ ได 3. อตราคาภาษปาย ปายประเภทท 1 หมายถง ปายทมอกษรไทยลวน ใหคดอตรา 3 บาท ตอ 500 ตารางเซนตเมตร ปายประเภทท 2 หมายถง ปายทมอกษรไทยปนกบอกษรตางประเทศ หรอปนกบภาพและเครองหมายอน ใหคดอตรา 20 บาท ตอ 500 ตาราง เซนตเมตร ปายประเภทท 3 หมายถง (ก) ปายทไมมอกษรไทย ไมวามภาพหรอเครองหมายใด ๆ หรอไม หรอ (ข) ปายทมอกษรไทยบางสวนหรอทงหมดอยใตหรอต ากวาอกษรตางประเทศ ใหคดอตรา 40 บาท ตอ 500 ตารางเซนตเมตรเมอค านวณพนทของปายแลวถามอตราต ากวาปายละ 200 บาท ใหเสยคาภาษปายละ 200 บาท 4. การไมยนแบบและช าระภาษภายในก าหนด - ผเปนเจาของปายรายใดไมยนแบบภายในก าหนดจะตองเสยเงนเพมอกรอยละ 10 ของคาภาษ - ผเปนเจาของปายรายใดไมช าระเงนคาภาษภายในก าหนด จะตองเสยเงนเพมอกรอยละ 2 ของคาภาษ - ผมหนาทเสยภาษจะตองแสดงหลกฐานการเสยภาษปายไว ณ ทเปดเผยในสถานประกอบการคา หรอประกอบกจการ

http://www.colourart2001.com/index.php?lay=show&ac=article&Id=280048&Ntype=5

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Project Feasibility Study and Evaluation

1203302

The Ladies’ Shoes Company Limited

Present to

Aj.Chaiyawat Thongintr

Presented by

Member group

1. Miss Araya Rojjanatranon ID: 5031203034

Email: [email protected] Tel. 082-1892879

2. Miss Wichanut Rungroat ID: 5031203142

Email: [email protected] Tel. 082-0295052

3. Miss A-porn Nantanoi ID: 5031203152

Email: [email protected] Tel. 085-6213578

4. Miss Pimpilai Chaiyatep ID: 5031203164

Email: [email protected] Tel. 087-1763227

5. Miss Wansiri Wonglaongpakdee ID: 5031203170

Email: [email protected] Tel. 085-2129003