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Business Plan Report

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Introduction 

Business Idea

The very idea of a “supermarket”is truly unique, in that it is a point at which wellness, value, and enjoyment all merge. Food, as well as other household goods, are sold in supermarkets (Terblanche, 2018). Often referred to as, grocery stores, supermarketsare the primary source of food for a household. Additionally, they sell essential cooking equipment, throwaway goods, cleaning supplies, sweets, alcoholic beverages, soft drinks, and self-care products. Grocery shops of today are excellent suppliers for a variety of items, making them critical local resources.

The business idea of this report will revolve around the planning of building asupermarket in Nepal which will be named as the “Pleathora”. It will achieve success as cooking and culinary arts are timeless in today’s world as well as essential in our day-to-day life.

Business Canvas

Key Partners

Key Activities

Value Proposition

Customer Relationships

Customers Segments

Channels

· Providers of IT services

· Suppliers of materials.

· Management of operations

· Provision of financial services.

· Marketing.

· Shelf arrangement in-store.

· Excellent service quality.

· Comparably cheaper prices.

· Great products supported by a strong marketing strategy

· Excellent online sales services

· Effective customer service

· Program of loyalty

· Shoppers from each class.

· Shoppers that are health aware.

· Internet

· Retail sales in-store

Cost Structure

Key Resources

· Value-driven and cost-cutting strategies

· Innovative ideas

· Through bonuses, loyalty programs, and other incentives, the firm invests in its employees.

· Financial resources (Mwambi, 2020)

· Human resource

· Technological resources

Objectives of the business

The objective of the business plan is generated from the thought of serving items that are fundamental to live to everyone at a moderate price so that people can easily afford to buy those (Doniecet al., 2020).

  • Pleathora’s objective is to achieve a strong and large customer base by serving its customers with a good quality product at a comparably lower price range. In that way, they can achieve a loyal customer base.
  • To attract the eyes of a large segment of customers through promotion, so that they can hold a strong position in Nepal’s marketplace.
  • Their objective is also to serve all of their customers with a range of items so that they never miss out on any product, and even if they do, they will make sure that substitutes are always available.

Pleathora will this way retain its customers and can further captivate new customers as well. This will in turn flourish the business.

1.0 Nature of the Business

1.1 Offered Products

Pleathora as a grocery store and supermarket will primarily engage in the retailing of a broad range of food supplies, which may be fresh or packed (Hendriksen et al., 2021.). But it would typically contain a substantial quantity of non-food items, such as clothes and home goods. It will be a larger version of the conventional grocery store, and indeed will be a self-service establishment that offers a diverse selection of food and home items grouped by aisles. This will generally be divided into lanes for meat, fresh fruit, dairy, and baked goods, as well as shelf space for canned and packaged foods and a variety of non-food items such as housewares, household cleansers, pharmaceutical products, and pet supplies. These goods that will be available at Pleathora will be available at comparably lower prices than other superstores or grocery stores.

1.2 Prioritizing potential Customers

Pleathora will be a synthesis of socialistic views and business marketing, so it is needless to say that its vision and goals revolve around the very idea of serving each and everyone according to their taste, choice and range (Hatthakijphong and Ting, 2019). Their goal will converge with the initiative to build a strong and large customer base and for that, they will be serving each of their customers as per their requirements. The bill will not decide the help the customers will get from the employees but rather the very recognition of "customer" will.

They will attract the eyes of the customers through their schemes of “pricing cheaper and serving better”. A strong marketing advertisement will be done by the company to amplify their provisions so that customers of Nepal can know about them and take advantage of the products and services offered by them.

1.3 Business with a Difference

The unique selling pricing will help Pleathora to set apart to be vivid in front of the eyes of the customers in Nepal. It will also stress to the point of flaunting the culture of Nepal so beautifully at the store so that all the customers- local or international get to be mesmerized by its decor, its selection of items to be sold and a soothing ambience that will effectively impact the buyers to shop more. Pleathora will make use of the tactics of pricing cheaper, making the availability of good quality products, essentials from international markets, good services provided by its employees and rewards, discounts, lucky draw, contests etc.

It will be competing with many supermarkets of Nepal namely Saleways Department Store, Grihini supermarket, Namaste Supermarket etc (Joshi, 2019). because there are plenty of supermarkets offering more or less the same things but Pleathora will certainly stand out among those because no other supermarket will ever be able to offer the service, the range of quality products at a cheaper price and the ambience that Pleathora is planning to offer.

2.0 Market Analysis

2.1 Target Market

To streamline the company’s business activities, the customers will be identified with the help of “demographic segmentation” (Mahlangu and Makhitha, 2019). The target market of Pleathora will be generally females andthey will target customers between the ages of 24 and 35 mainly and also the age groups of 35 to 50 and also 18-24. They will make available all the necessary and luxury items that each has to ask for.

PEST analysis:

Factors

Effects

Political

· Pleathora will be heavily influenced by political factors in Nepal’s current setting.

· Nepal’s unpredictable political situation, which results in bands, strikes, and, a variety of other issues, will affect the operations of Pleathora.

· In the worst-case scenario, the supermarket would likewise have to close during those bands.

Economic

· In order to sustain its economics, Pleathora will need to sustain its price strategy following the country and the world’s economic cycles (Gurung, 2018).

Social

· The society of Nepal has not yet established the habit of supermarket shopping. People like to shop in nearby stores.

· Plaethora’s introduction of its value and savings idea to its consumers and ambition to expand will be positive signs of the company’s growth.

· If Pleathora could be capable of adapting to society and satisfy its consumers, it will be successful.

Technological

· Pleathora must make use of a variety of technology. Without technology, it would not be able to compete with established stores such as bhatbhateni (Rajbhandari and Intravisit, 2017).

· The utilisation of computers, billing machines, and a variety of other technical equipment will enable it to function and serve consumers efficiently and accurately.

· Thus, if it continues to invest in new technology, it may be able to keep up with the competition.

2.2 Marketing and Distribution Channels

For marketing Pleathora will constructively and efficiently use the provision of social media to amplify their offers, their rewards, bonuses, coupons, discounts, better items at a lesser price etc (Tama, 2021).

And as they are going to open a supermarket so they will be making use of the direct distributing strategy as it will better suit them.

2.3 Competitors

Strength

Weakness

· An attractive pricing strategy will help to stand out from other companies like Sideways Department Store, Grihini supermarket, Namaste Supermarket etc.

· Advantages of services

· Good ambience

· Quality products

· Surrounded by many other supermarkets like Saleways Department Store, Grihinisupermarket, Namaste Supermarket etc.

· The project is time-consuming.

Opportunities

Threats

· Opportunity to stand out among Saleways Department Store, Grihini supermarket, Namaste Supermarket etc because of the tactics outlined

· Large customer base

· Customers from different sections

· High competition from Saleways Department Store, Grihini supermarket, Namaste Supermarket etc (Sapkota et al., N.D.).

· The threat of corona.

3.0 Supply Chain, Operations & Logistics

Pleathora will maintain good conduct with its local (and, international) suppliers and collect the goods that it planned to sell regularly so they never miss out on anything or run on fewer products. They will keep the products at warehouses known as inventory from where they can stock and restock to their departmental store and thus it can be distributed to the customers from there again (Lagorio and Pinto, 2021).

They will effectively make use of social media to attract customers.

Figure 2: Supply Chain Process in the business of Pleathora

4.0 Human Resource Planning

4.1 AboutBusiness Owners

The business owners of Pleathora are Mr X and Mr Y who are friends their college days and also did their MBA together from the Ulster University of London. They planned to open a supermarket that will contain in itself the advantages of low price, good quality, good service and a variety of products with many others supreme offers.

4.2 The Entrepreneurial Team’s Background

The entrepreneurial team will be the primary strategic decision-makers for the business, and the strategic decisions and behaviours of the business will be the result of Pleathora’s members’ cognition and interaction. Pleathora will typically be composed of members with varying levels of professional and work experience; the personal backgrounds of entrepreneurial teams will affect not only individual cognition but also how team members interact with one another, thereby affecting group cognition and collective interaction style (Rae, 2018).

Mr X and Mr Y will choose to supervise the store from the starting to the end of the day, they will need engaging, active workers to run the business. They will arrange walk-in interviews, online applications, media advertisements to find the right applicants and then choose as per the qualification.

4.3 Required Staffs

To perform the functions neatly, Pleathora will need its organisational structure; the majority include a store manager, an assistant manager, as well as department and management staff for each department (Mahardiana and Thahir, 2019).

Cashiers are the backbone of every retail enterprise, especially supermarkets. These employees are responsible for scanning items and processing payments. They accept coupons, change money, issue receipts, and do a variety of other related activities.Stockers replenish grocery shop shelves by relocating items from storerooms to their proper locations inside the store. These employees answer consumer inquiries about goods; rearrange things on shelves to make them more apparent and front-facing and price items. Products are loaded into supermarket bags by baggers. Additionally, they may transport bagged items to the parking and transfer them into clients’ vehicles. Customer service staff assist consumers with queries, sell items that are not present in the stores, and resolve customer concerns.

5.0 Legal and Regulatory Requirements

For this business trade license, property documents, Tax registration, Permanent Account Number (PAN) Registration, Value Added Tax (VAT) Registration are highly required (Pokharel, 2021). Along with this, they need to maintain their tax papers also.

But due to Covid-19 Pleathorawill face many problems as many govt institutions are partly open so they will face the problem of arranging all the documents at once, which will result in a severe time-consuming occasion.

6.0 Risks and Challenges

From the SWOT analysis, it can be assessed that it will have to face many threats as the corporate sector is always battling the harmful effects of coronavirus; Pleathora will be harmed as well. Employees are bearing the brunt of the shutdown; stores are being forced to shutter or remain partially open according to government directives. As a result, revenue will be lower than anticipated as well. The battle in Nepal’s grocery industry will also intensify as Pleathora as new businesses will enter the market. To recover from these incidents, the supermarket should implement a contingency plan that includes placing sanitization stations around the shop, providing masks, hand gloves, and shoe covers to each customer to identify them as safe, allowing the supermarket to operate effectively (Abid and Jie, 2021). To ensure their uniqueness in the market of Nepal, they have already considered numerous ideas to implement, such as providing a soothing experience through the presentation of a rich and vast cultural ambience, numerous rewards, gifts, coupons, and free items, but they can also offer free home delivery and arrange for 24x7 service.

7.0 Finance

7.1 Financial Needs for Pleathora

Starting a business venture to open a store or supermarket demands a considerable investment, based on the size of the store. The funding for the proposed business of Pleathora is required for different activities, which begins with registration and expands over a vast range of requirements that will include store designing, employee recruitment, business promotion taking a venue for the store on rent or lease, product purchase for stock and technological equipment like billing counter, CCTV surveillance and billing software.

Financial Forecast

Cost, Revenue and Profit for 2021 (NPR)

Registration

15,000

Renting or Leasing a Place

30,000

Store Design

40,000

Recruitment and Promotion

20,000

Product for Stock

55,000

Technological Equipment

5,000

Estimated Cost

1,65,000

Estimated Revenue

2,00,000

Estimated Profit

35,000

Profit and Loss Statement of 12 Months’ Period:

Pro Forma Profit and Loss (in NRP)

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Year 1

Sales

25,000

25,000

25,000

25,000

25,000

25,000

25,000

25,000

25,000

25,000

25,000

25,000

300,000

Direct Cost of Sales

12,500

12,500

12,500

12,500

12,500

12,500

12,500

12,500

12,500

12,500

12,500

12,500

150,000

Hidden Row

0

0

0

0

0

0

0

 

0

0

0

0

0

Total Cost of Sales

12,500

12,500

12,500

12,500

12,500

12,500

12,500

12,500

12,500

12,500

12,500

12,500

150,000

                           

Gross Margin

12,500

12,500

12,500

12,500

12,500

12,500

12,500

12,500

12,500

12,500

12,500

12,500

150,000

Gross Margin %

50%

50%

50%

50%

50%

50%

50%

50%

50%

50%

50%

50%

50%

                           

Expenses:

Payroll

5,000

5,000

5,000

5,000

5,000

5,000

5,000

5,000

5,000

5,000

5,000

5,000

60,000

Marketing/Postage/Other

250

250

250

250

250

250

250

250

250

250

250

250

3,000

Depreciation

100

100

100

100

100

100

100

100

100

100

100

100

1,200

Legal

75

75

75

75

75

75

75

75

75

75

75

75

900

Books/Accounting

66.66

66.66

66.66

66.66

66.66

66.66

66.66

66.66

66.66

66.66

66.66

66.66

800

Licenses/Permits/Memberships

83.33

83.33

83.33

83.33

83.33

83.33

83.33

83.33

83.33

83.33

83.33

83.33

1,000

Delivery/Transportation

166.66

166.66

166.66

166.66

166.66

166.66

166.66

166.66

166.66

166.66

166.66

166.66

2,000

Insurance

166.66

166.66

166.66

166.66

166.66

166.66

166.66

166.66

166.66

166.66

166.66

166.66

2,000

Rent

1666.66

1666.66

1666.66

1666.66

1666.66

1666.66

1666.66

1666.66

1666.66

1666.66

1666.66

1666.66

20,000

Utilities

833.33

833.33

833.33

833.33

833.33

833.33

833.33

833.33

833.33

833.33

833.33

833.33

10,000

Equipment/Supplies

250

250

250

250

250

250

250

250

250

250

250

250

3,000

Building/Equipment Maintenance

83.33

83.33

83.33

83.33

83.33

83.33

83.33

83.33

83.33

83.33

83.33

83.33

1,000

Payroll Taxes

0

0

0

0

0

0

0

0

0

0

0

0

0

Other

83.33

83.33

83.33

83.33

83.33

83.33

83.33

83.33

83.33

83.33

83.33

83.33

1,000

                           

Total Operating Expenses

8,825

8,825

8,825

8,825

8,825

8,825

8,825

8,825

8,825

8,825

8,825

8,825

105,900

                           

Profit Before Interest and Taxes

3,675

3,675

3,675

3,675

3,675

3,675

3,675

3,675

3,675

3,675

3,675

3,675

44,100

EBITDA

3775

3775

3775

3775

3775

3775

3775

3775

3775

3775

3775

3775

45,300

Interest Expense

250

250

250

250

250

250

250

250

250

250

250

250

3,000

Taxes Incurred

291.66

291.66

291.66

291.66

291.66

291.66

291.66

291.66

291.66

291.66

291.66

291.66

3,500

                           

Net Profit

3,133.33

3,133.33

3,133.33

3,133.33

3,133.33

3,133.33

3,133.33

3,133.33

3,133.33

3,133.33

3,133.33

3,133.33

37,600

Balance Sheet of 12 Months’ Period:

Pro Forma Balance Sheet

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Year 1

Assets

Current Assets:

                         

Cash

3548.08

3548.08

3548.08

3548.08

3548.08

3548.08

3548.08

3548.08

3548.08

3548.08

3548.08

3548.08

42,577

Inventory

1364

1364

1364

1364

1364

1364

1364

1364

1364

1364

1364

1364

16,368

Other Current Assets

416.66

416.66

416.66

416.66

416.66

416.66

416.66

416.66

416.66

416.66

416.66

416.66

5,000

Total Current Assets

5328.75

5328.75

5328.75

5328.75

5328.75

5328.75

5328.75

5328.75

5328.75

5328.75

5328.75

5328.75

63,945

Long-term Assets:

                         

Long-term Assets

1666.66

1666.66

1666.66

1666.66

1666.66

1666.66

1666.66

1666.66

1666.66

1666.66

1666.66

1666.66

20,000

Accumulated Depreciation

208.33

208.33

208.33

208.33

208.33

208.33

208.33

208.33

208.33

208.33

208.33

208.33

2,500

Total Long-term Assets

1458.33

1458.33

1458.33

1458.33

1458.33

1458.33

1458.33

1458.33

1458.33

1458.33

1458.33

1458.33

17,500

Total Assets

6787.08

6787.08

6787.08

6787.08

6787.08

6787.08

6787.08

6787.08

6787.08

6787.08

6787.08

6787.08

81,445

                           

Liabilities and Capital

Current Liabilities:

                         

Accounts Payable

1570.41

1570.41

1570.41

1570.41

1570.41

1570.41

1570.41

1570.41

1570.41

1570.41

1570.41

1570.41

18,845

Current Borrowing

0

0

0

0

0

0

0

0

0

0

0

0

0

Other Current Liabilities

0

0

0

0

0

0

0

0

0

0

0

0

0

Subtotal Current Liabilities

1570.41

1570.41

1570.41

1570.41

1570.41

1570.41

1570.41

1570.41

1570.41

1570.41

1570.41

1570.41

18,845

                           

Long-term Liabilities

7142.83

7142.83

7142.83

7142.83

7142.83

7142.83

7142.83

7142.83

7142.83

7142.83

7142.83

7142.83

85,714

Total Liabilities

8713.25

8713.25

8713.25

8713.25

8713.25

8713.25

8713.25

8713.25

8713.25

8713.25

8713.25

8713.25

104,559

                           

Paid-in Capital

2000

2000

2000

2000

2000

2000

2000

2000

2000

2000

2000

2000

24,000

Retained Earnings

(5275)

(5275)

(5275)

(5275)

(5275)

(5275)

(5275)

(5275)

(5275)

(5275)

(5275)

(5275)

(63,300)

Earnings

1348.83

1348.83

1348.83

1348.83

1348.83

1348.83

1348.83

1348.83

1348.83

1348.83

1348.83

1348.83

16,186

Total Capital

(1926.16)

(1926.16)

(1926.16)

(1926.16)

(1926.16)

(1926.16)

(1926.16)

(1926.16)

(1926.16)

(1926.16)

(1926.16)

(1926.16)

(23,114)

Total Liabilities and Capital

6787.08

6787.08

6787.08

6787.08

6787.08

6787.08

6787.08

6787.08

6787.08

6787.08

6787.08

6787.08

81,445

                           

Net Worth

(1926.16)

(1926.16)

(1926.16)

(1926.16)

(1926.16)

(1926.16)

(1926.16)

(1926.16)

(1926.16)

(1926.16)

(1926.16)

(1926.16)

(23,114)

7.2 Break-even Point

  • Pleathora will begin with a total start-up cost of approximately 1,65,000 NPR including all the areas of investment mentioned above.
  • The average selling price of all grocery and non-grocery products is 45 NPR
  • The average variable cost for each product is 25 NPR
  • Therefore, the overall profit from each product is 45-25 = 20 NPR
  • To reach the breakeven point, Pleathora will target to sell 1,65,000/20=8,250 units of products
  • If the company sells approx. 1000 products per month, it will need 8,250/1,000=(8.25)8 months approx.

7.3 Funding for the Business

Once the financial needs for the business start-up are recognised by Pleathora, and estimation is set for cost, revenue and profit, the business will need funding to source their finance for various requirements. There are several kinds of business-friendly funding, which assist to make the most of the financing, such as small business administration (SBA) loans, financing for equipment, alternative lenders, bank term loan etc (Wood, 2020). Depending on the need of the business, it will be suitable for Pleathora to obtain a business line of credit, an excellent tool to satisfy the company’s need for the supermarket store loan. Such loans are different from credit cardsin several aspects. A business line of credit can be offered by a lender, and rather than needing the business to accept the full payment upon the approval of the loan, Pleathora can tap into an entire or partial section of the total amount of the loan (Chakraborty and Hu, 2006). While the loan term is still valid, the business can even borrow from that cash often as per their choice. This loan facility offers favourable figures of interest and a higher limit of expenditure than credit cards.

8.0 Key Milestones

Objectives

Time

Availing Good Quality Products at Lower Price

Attracting Consumers towards the Business through Promotion

Achieving and Large Consumer Base

Restocking with Substitute Products in Stock for Better and Continued Customer Service

October ‘21 – December ‘21

01.10.2021 – 31.10.2021

       

01.11.2021 – 30.11.2021

       

01.12.2021 – 30.12.2021

       

January ‘22 – March ‘22

02.01.2022 – 31.01.2022

       

01.02.2022 – 28.02.2022

       

01.03.2022 – 31.03.2022

       

April ‘22 – September ‘22

01.04.2022 – 30.04.2022

       

01.05.2022 – 31.05.2022

       

01.06.2022 – 30.06.2022

       

01.07.2022 – 31.07.2022

       

01.08.2022 – 31.08.2022

       

01.09.2022 – 30.09.2022

       

Estimated Cost

40,000

8,000

-

10,000

Conclusion

The business plan has been prepared for a supermarket business to be established in Nepal, named Pleathora. The supermarket store is being set to provide quality grocery and non-grocery products at a lower price to gain a large and loyal consumer base. In this context, all the required market analysis, planning for the human resource, supply chain, operations, finance, legislation and regulations and assessment on risks and challenges have been done, along with setting key milestones for the objectives.

References

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Doniec, A., Lecoeuche, S., Mandiau, R. and Sylvain, A., 2020. Purchase intention-based agent for customer behaviours. Information Sciences521, pp.380-397.

Gurung, S.K., 2018. Fiseability study of nepalese fast food and restaurants in Tampere region.

Hatthakijphong, P. and Ting, H.I., 2019. Prioritizing successful entrepreneurial skills: An emphasis on the perspectives of entrepreneurs versus aspiring entrepreneurs. Thinking Skills and Creativity34, p.100603.

Hendriksen, A., Jansen, R., Dijkstra, S.C., Huitink, M., Seidell, J.C. and Poelman, M.P., 2021. How healthy and processed are foods and drinks promoted in supermarket sales flyers? A cross-sectional study in the Netherlands. Public Health Nutrition24(10), pp.3000-3008.

Joshi, P., 2019. The growth, roles and needs of the private education system: Private stakeholder perspectives from Nepal. International Journal of Educational Development65, pp.57-67.

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