EXECUTIVE SUMMARY
pattern and amount of consumer expenditure in India
Brio stands for happiness, vigor, vivacity and most
important, it stands for life. It also happens to be LG’s
new retail initiative along with @home.
Established in 1997, LG Electronics India Pvt. Ltd., is a
wholly owned subsidiary of LG Electronics, South Korea.
In India for a decade now, LG is the market leader in
consumer durables and recognized as a leading
technology innovator in the information technology and
mobile communications business. LG is the
acknowledged trendsetter for the consumer durable
industry in India with the fastest ever nationwide reach,
latest global technology and product innovation.
@home, A Nilkamal Limited enterprise provides world-
class furniture, furnishings, accessories, lights,
kitchens, flooring, decorative wall finishes and more.
According to ‘The Rise of The Indian Consumer Market’
(A McKinsey report), the Indian consumer market is
predicted to grow four times by 2025. As of September
2009, India continues to be among the most attractive
countries for global retailers. With a worth of US $ 511
billion in 2008 the retail market is larger than ever and
continues to draw both global and local retailers.
Changing lifestyles, higher disposable income, greater
product awareness, affordable pricing and a surge in
advertising have been instrumental in changing the
Business Plan for Brio-An LG Initiative
which has led to the robust growth of the consumer
durables industry.
The Indian consumer durables sector is estimated to be
Rs. 41,500 cr as of November 2009.
Keeping this in mind and with the results of the primary
and secondary research conducted on consumer
perception of LG, there was a need felt to come up with
something new. Apart from having its presence in
various electronic megastores, LG also has its exclusive
retail stores and which extend to loyal customers be it
for the products or services. Along with its current
target audience, LG wants to cater to a higher income
group in a different way, increasing its visibility and
improving its perception in the process.
And thus, Brand Brio was born. Through this novel
undertaking, Brio aspires to give its customers a
distinctive shopping experience. Its offerings include
the entire LG product range as well as the classy and
elegant home decors by @home, thus providing a
refreshing mélange of quality technology consumer
durables along with tasteful home furnishings. The
objective is to empower the customer through
customization, where they have the option to choose
their own combinations of home electronics and
Page 1
furnishings. They can walk into the store and either buy
a single LG product or order an entire living
room/kitchen set up.
EXECUTIVE SUMMARY
After its successful shoppes and exclusive stores, LG
now proposes to set up a retail chain in association with
the high end home lifestyle
brand (@home) so as to distinguish itself from its
competition by integrating superior technology and
quality home furnishings in order to provide consumers
with futuristic solutions to their living environment. This
innovative venture will help strengthen its hold in the
retail market and better the brand perception in the
minds of the consumers. Brio is committed to providing
quality with affordability. The ultimate objective of Brio
is thus to build long-lasting relationships with its
customers through a unique and satisfying experience
of LG’s innovative products and services.
Brio aims to target various demographic,
psychographic, geographic, behavioral and sequential
segments which have been mentioned in detail as the
plan progresses. It also intends to exceed its
competition and stand apart from the other consumer
durables retail outlets. It seeks to create a niche for
itself in the retail sector.
Business Plan for Brio-An LG Initiative
Brio will go all out in its promotions pre, during and post
its launch, making optimum use of the appropriate
media platforms. It will have competitive pricing with
exciting and regular combo offers and freebies.
In the short term, Brio intends to have two stores, one
each in Mumbai and New Delhi. Depending on the
success of these stores, it
will later venture out into the major metros making its
presence felt in all parts of the country. LG has
manufacturing units at Ranjangaon, Pune and at
Greater Noida. Thus sourcing the products will not be a
problem. @home goods will be sourced from the
nearest stockist available or from their flagship stores if
the need arises. It will follow the producer to customer
method of distribution.
Brio will be headed by the Vice President, Retail, LG
with a team of efficient and dedicated professionals. It
will also be equipped with an Advisory Board. The
startup expenditure for Brio is estimated to be around
20 lakh (please see financial plan for details).
Please read through the entire business plan for a
better understanding and a detailed report on Brio.
Page 2
 billion in 2008 the retail market is larger than ever and
continues to draw both global and local retailers.
According to the Department of Industrial Policy and
Promotion (DIPP), Foreign Direct Investment (FDI)
inflows as of July 2009 in single brand retailing stood at
approximately US $ 46.60 million.

Being a country with high growth rates consumer

spending rose an impressive 75% in the last four years
alone. One of the main reasons for this is the significant
increase of the disposable income among the youth
population.

BUSINESS CASE
RETAIL SECTOR ANALYSIS

A T Kearney’s 8th Annual Global Retail Development

25%
Index (GRDI) of 2009 ranked the Indian market as the
most promising emerging market for investment in the
retail sector. The contribution of the retail trade in the 20%
country’s GDP which was between 8-10% in 2007 is
now around 12% and is estimated to reach 22% by
15%
2010.
2007
According to ‘The Rise of The Indian Consumer Market’
10% 2009
(A McKinsey report), the Indian consumer market is
predicted to grow four times by 2025. As of September 2010
2009, India continues to be among the most attractive 5%
countries for global retailers. With a worth of US $ 511
0%
Business Plan for Brio-An LG Initiative Page 3
2007
2009
2010
 unbranded products added with the high quality of after
BUSINESS CASE sales service provided by the branded player.

The consumer durable market in India is a dynamic and

CONSUMER DURABLES SECTOR ANALYSIS
fast growing market. With disposable incomes
Changing lifestyles, higher disposable income, greater increasing, there is an
product awareness, affordable pricing and a surge in
advertising have been instrumental in changing the
pattern and amount of consumer expenditure in India
which has led to the robust growth of the consumer
durables industry.
increasing demand for these products. The market size
The Indian consumer durables sector is estimated to be
in India is today estimated to be around Rs 25000 cr.
Rs. 41,500 cr as of November 2009. The Indian
The chart below gives a graphic representation of the
consumer durables segment can be segregated into
market size of different segments of this industry.
White goods like refrigerators, washing machines, air
conditioners, speakers and audio equipment; Brown
goods/Kitchen Appliances like mixers, grinders,
microwave ovens, irons, electric fans, cooking range
chimneys and Consumer Electronics like mobile phones,
televisions, MP3/VCD/DVD players, computers and
laptops.

As per a survey conducted by FICCI on the Indian

consumer durables industry, a shift in consumer
preferences towards higher-end, technologically
advanced branded products has been quite
Projected Growth Rates for the Consumer Durables
discernable. This shift can be explained by narrowing
Industry:
differentials between the prices of branded and

Business Plan for Brio-An LG Initiative Page 4

  Local manufacturing will continue to stay
competitive

Challenges

 Heavy taxation
 Threat of new entrants
 Imported raw materials
 Competitive rivalry
 Wide variety and choice for customers
 Risk of unbranded and cheaper products in the
BUSINESS CASE market

Opportunities & Challenges of the Consumer

Durable Industry
W
Opportunities

 Rising growth rate of GDP

 Rising purchasing power of people with higher WHY LG WANTS BRIO?
propensity to consume with preference for
For South Korean consumer electronics major LG
sophisticated brands
Electronics, India graphed the highest growth rate in
 Increasing popularity of easily available consumer
terms of sales compared with its other markets in the
loans
last five months, beating global trends of slackened
 Phenomenal growth of media
consumer spending due to recessionary fears.
 Vigorous marketing efforts being made by the
domestic majors
LG Electronics India Ltd (LGEIL) clocked a growth rate of
 Reduction in import duties may significantly lower 18 per cent in the last five months compared with the
prices of products corresponding period of 2008, mostly driven by

Business Plan for Brio-An LG Initiative Page 5

increase in sale of products in the refrigeration and AC
segments. The company is aiming at a 25 per cent
growth in turnover for 2009 to touch about US$ 2.68
billion.
For now, the moves by manufacturers into the world of
bricks-and-mortar retailing arguably are the most
interesting parts of the trend to watch. Manufacturers
are trying to directly reach consumers who might select
their products or service and give them an opportunity
to touch and feel a variety of their products, and also to
leave them feeling good about the brand experience.
Company stores are most helpful for manufacturers
that want to maintain more of a luxury or status image
for their products. Also, the marketing efforts of the
independent retailers tend to benefit the company
store automatically even at competitive pricing
situations.
GENERAL COMPANY DESCRIPTION
LG
Established in 1997, LG Electronics India Pvt. Ltd., is a
wholly owned subsidiary of LG Electronics, South Korea.
In India for a decade now, LG is the market leader in
consumer durables and recognized as a leading
technology innovator in the information technology and
mobile communications business. LG is the
Business Plan for Brio-An LG Initiative
acknowledged trendsetter for the consumer durable
industry in India with the fastest ever nationwide reach,
latest global technology and product innovation.
The trend of beating industry norms started with the
fastest ever-nationwide launch by LG in a period of 4
and 1/2 months with the commencement of operations
in May 1997. LG set up a state-of-the art manufacturing
facility at Greater Noida, near Delhi, in 1998, with an
investment of Rs 500 Crores. This facility manufactured
Colour Televisions, Washing Machines, Air-Conditioners
and Microwave Ovens. During the year 2001, LG also
commenced the home production for its eco-friendly
Refrigerators and established its assembly line for its
PC Monitors at its Greater Noida manufacturing unit.
The beginning of 2003 saw the roll out of the first
locally manufactured Direct Cool Refrigerator from the
plant at Greater Noida.
In 2004, LGEIL also up its second Greenfield
manufacturing unit in Pune, Maharashtra that
commences operations in October 2004. Covering over
50 acres, the facility manufactures LCD TV, GSM
Page 6
Phones, Color Televisions, Air Conditioners,
Refrigerators, Microwave
Ovens Color Monitors.
Both the Indian manufacturing units has been designed
with the latest technologies at par with international
standards at South Korea and are one of the most Eco-
friendly units amongst all LG
manufacturing plants in the world.
LG has been able to craft out in ten years, a premium
brand positioning in the Indian market and is today the
most preferred brand in the segment. LG Electronics
pursues its 21st century vision of “becoming a true
global digital leader who can make its customers
worldwide happy through its innovative digital products
and services.”
LG Electronics is pursuing the vision of becoming a true
global digital leader, attracting customers worldwide
through its innovative products and design. The
company’s goal is to rank among the top 3 consumer
electronics and telecommunications companies in the
world by 2010. To achieve this, LG has embraced the
idea of “Great Company, Great People,” recognizing
that only great people can create a great company.
GENERAL COMPANY DESCRIPTION
@home
Business Plan for Brio-An LG Initiative
The story of @home began when the USD 215 million
Nilkamal Limited, the world leaders in molded furniture
and India’s number one Material Handling System
Company, discovered a need for a classy one-stop
home shop in India. The group initiated @home, an
international format home décor store. Spread across
major cities, @home offers more than 20,000 sq.ft. of
world-class furniture, furnishings, accessories, lights,
kitchens, flooring, decorative wall finishes and more. By
2010 @home aims to be the dominant national player
with 50 flagship stores.
The home maker store is dedicated to making you
proud of your home, making you feel at home.
Reliability is part of the bedrock of @home’s
personality; it reinforces the stakeholder's trust in the
company and helps them see @home as a 'genuine'
company credible, dependable and faithful. @home has
strong principles that everyone is entitled to be viewed
as equal, to be free and be their own individual, an non-
discriminatory, un-biased and impartial outlook. Design
and practicality are @home’s business for which they
have been are admired and respected. @home is fresh
and enthusiastic. It sees everything as achievable, is
modern at heart and practical in approach. @home is
the face of new India at home.
Page 7

According to @ home, the best person to design your
home is yourself. And it gives you the option of doing
up your house in ten different styles. Their 3Dimaging
Software helps you mix and match furniture,
accessories and wall finishes for every room.
@home provides FREE interior planning services, where
you can bring your home plans and their designers will
help you walk out with your dream home, just the way
you want it.
BRIO
Brio is a new retail venture by LG, and has tied up with
@ home in a 70-30% percent partnership. Apart from
having its presence in various electronic megastores,
LG also has its exclusive retail stores and which extend
to loyal customers be it for the products or services.
Along with its current target audience, LG wants to
cater to a higher income group in a different way,
increasing its visibility and improving its perception in
the process.
And thus, Brand Brio was born. Through this novel
undertaking, Brio aspires to give its customers a
distinctive shopping experience. Its offerings include
the entire LG product range as well as the classy and
Business Plan for Brio-An LG Initiative
elegant home decors by @home, thus providing a
refreshing
GENERAL COMPANY DESCRIPTION
mélange of quality technology consumer durables along
with tasteful home furnishings. The objective is to
empower the customer through customization, where
they have the option to choose their own combinations
of home electronics and furnishings. They can walk into
the store and either buy a single LG product or order an
entire living room/kitchen set up.
After its successful shoppes and exclusive stores, LG
now proposes to set up a retail chain in association with
the high end home lifestyle brand (@home) so as to
distinguish itself from its competition by integrating
superior technology and quality home furnishings in
order to provide consumers with futuristic solutions to
their living environment. This innovative venture will
help strengthen its hold in the retail market and better
the brand perception in the minds of the consumers.
Brio is committed to providing quality with affordability.
The ultimate objective of Brio is thus to build long-
lasting relationships with its customers through a
Page 8
unique and satisfying experience of LG’s innovative
products and services.

The superior shopping experience, product innovation,

friendly sales people, plush interiors, sophisticated
ambience, prompt after sales service and helpful
customer care are all woven into a brand that is Brio. It
being an LG initiative it will follow all the principles,
values and standards that the latter stands for. Its
worldwide objectives and purposeful practices will be
imbibed into the new venture. In addition to the above
Brio seeks to add value to each purchase experience PRODUCTS & SERVICES
making every customer come back and relive the
experience time and again. Brio will have the entire LG consumer durables range
(white goods, brown goods/kitchen appliances, and
consumer electronics) and a select range of
complimentary lifestyle products by @ home.

THE LG PRODUCT RANGE

Business Areas & Main Products

Category Main Products

LCD TV , Plasma Display , Display Panel, Color Television,
Consumer Electronics Home Theatre System, Music system, DVD Recorder/Player,
MP3 & MP4 Player
Room Air Conditioner, Commercial Air Conditioner ,
Home Appliances Refrigerator, Washing Machine, Dishwasher, Microwave,
Vacuum Cleaner
Laptop, Personal Computer, LCD monitor, CRT monitor, Optical
Computer Products
Storage Devices

Premium trend setter phone , Camera Phone , Music Phone ,

Mobile Phone
Color Screen GSM Handset

Business Plan for Brio-An LG Initiative Page 9

  29 (73 cms)
Televisions
Digital Audio Video
LCD TVS
 LED LCD TV SERIES  Home Theatre System
 JAZZ ATOM SERIES  Music Player
 JAZZ THEATRE SERIES  DVD Player
 JAZZ (LG 80) SERIES
 SCARLET 2.0 ( LH 70 ) SERIES

PRODUCTS & SERVICES

Computer Products
 LH 50 SERIES
 LH 35 SERIES
Monitor
 LF 20 SERIES
 LH 20 SERIES  CRT
 LCD
PLASMA TVS
Optical Storage Devices
 PS 80 SERIES
 PQ 70 SERIES Notebooks & Laptops
 PG 70 SERIES
 PQ 60 SERIES
 PQ 30 SERIES Projector
 Ultra Mobile Projector
 Business Projector
ULTRASLIM TVS
External Hard Disk
FLAT TVS

 15 (38 cms) Mobile Phones

 21 (53 cms)  Eigen

Business Plan for Brio-An LG Initiative Page 10

  Viewty Smart
 Arena Vacuum Cleaners
 COOKIE
 GD900
 GW525
 GT505
 KS660
 KF350
GW300

PRODUCTS & SERVICES

Microwave Oven
 KM380T  Solar Dom
 KS360  Convection
 KF300  Grill
 KF510  Solo
 GM200
 DYNAMITE Room Air Conditioner
 ALL ROUNDER
 Inverter
 Art Cool
Refrigerator
 Floor Standing
 Side by side refrigerator  Multi Split
 Frost free refrigerator  Hot and Cold AC
 Direct cool refrigerator  Split AC
 Window AC
Washing Machine
 Dish Washer Commercial AC
 Steam Washer Dryer  Ducted type AC
 Washer Dryer  Non Ducted type AC
 Front Load Washing Machine
 Top Load Washing Machine Air Purifiers
 Semi Automatic
Business Plan for Brio-An LG Initiative Page 11
  Side table
Refrigerator Compressors  Nest tables
 Bar stools
 Bar units
 Office tables

PRODUCTS & SERVICES

Dining
THE @home PRODUCT RANGE  Dining table
 Dining chairs
Sleeping  Service carts
 Beds
 Night stands Furnishings
 Dressers  Bed covers
 Wardrobes  Cushion covers
 Study Desks
Home Accessories
 Utility Cabinets
 Carpets
 Bean Bags
 Mirrors
 Study Chairs
 Photo frame
 Planters
Living
 Show piece
 Seating
 Vases
 Wall units
 Candle stand
 A V trolley  Fruit bowl
 Cabinets
 Shoe rack Lighting
 Centre table
 Floor lamps
Business Plan for Brio-An LG Initiative Page 12
  Table lamps
BRIO CUSTOMER CARE & SERVICES (As per
existing LG norms)
 Exchange Policies
 Service Centre Locator
 Complaint Registration
 Warranty
 Annual Maintenance Contract
 Extended Warranty
 LG’s 211 Service
What’s 211?
MARKET RESEARCH TO TEST CONSUMER BRAND PERCEPTION: PRIMARY & SECONDARY
However good a product or service may be, no business
can succeed without effective marketing. One of the
essential elements for this in current times is Market
Research. For in any consumer-driven business it is
important to know what the consumers actually want
and expect from the company/brand.
Business Plan for Brio-An LG Initiative
2 Call back to customers within 2 hours 1 Service
engineer visit within 1 day 1 In a promised one hour
time slot
2.1.1. is a service initiative from LG, that is first of its
kind in India. A Prompt Response Service through which
Brio will attempt to provide customers with a quick
after-sales service to nurture their relationship with LG
and ensure the sound functioning of all favorite
LG products.
In any one of the 135 cities where LG 2.1.1. service is
currently operational, customers can log on to the
website, give a call, send an SMS or simply a mail to get
an instant registration. After which Brio’s endeavor will
be to call the customer back within the promised one
hour time slot. For Brio it means being there for the
customer, and for the customer it is simply no waiting.
MARKETING PLAN
Taking this into account, we conducted primary and
secondary research before coming up with the concept
of Brio.
In primary research, we administered questionnaires
among 50 people to find out how they relate to the LG
Page 13
brand including its products and services. The objective
was to get an idea about how
Q1. Do you think LG is safe to use?
consumers perceived LG, whether the brand has met
their expectations and the areas that can be worked
upon.
Based on the results of the research we have
attempted to come up with solutions that aim to fill any
gaps that hitherto may not have been touched upon.
Through Brio, we intend to achieve the same.
Q2. Do you think LG is consistent in delivering on the
promise it makes?

In secondary research we went through a number of

online references including the official LG website and
various consumer forums along with certain print
material.

Yes

No

0 10 20 30 40 50 60

MARKETING PLAN
Q3. Do you think the products offered by LG are well-
designed?

Business Plan for Brio-An LG Initiative Page 14

Q4. Do you think LG offers good value for money?

Q.6. Does LG satisfy your needs through the variety of

products they provide?

Q5. Does LG respond to your changing needs as a

customer?

MARKETING PLAN
Q7. Do you think that LG is innovative?

Business Plan for Brio-An LG Initiative Page 15

Q8. Do you think LG supports the community? Q10. Do you think LG has a healthy environment and a
good employee relationship?

MARKETING PLAN
Q11. Would you recommend LG to someone?
Q9. Do you think LG practices good corporate ethics?
Business Plan for Brio-An LG Initiative Page 16
 Q13. Would a discount offer on a particular brand make
you change your decision?

Q12. Do you research before going in for a particular

brand?

Q14. Are you loyal to any one particular brand? If yes

do not answer question no. 15 and 16.

MARKETING PLAN

Business Plan for Brio-An LG Initiative Page 17

Q15. Does the reputation of the brand matter to you Q17. Would you be interested in having technology
while buying a product? integrated furniture for your home?

Q16. Have you come across other bands which provide

better products that LG? Q18 Would you be interested in visiting such a store (if it
existed) having only a single brand entity?

MARKETING PLAN
Secondary Research

Business Plan for Brio-An LG Initiative Page 18

We conducted Secondary research to see how  Relatively high cost structure for set up of the
successful Brio would be as a retail venture. We did sore
SWOT and PEST to find out how lucrative Brio would be
to LG and @home.  Fixed price

SWOT Analysis Opportunities

SWOT Analysis is a strategic planning method used to  Explore market in other places
evaluate the Strengths, Weaknesses, Opportunities,
 Tap potential customers
and Threats involved in a project or in a business
venture. It involves specifying the objective of the  Generate employment
business venture or project and identifying the internal
and external factors that are favorable and unfavorable  Help manufacturing unit to attain economies of
to achieving that objective. scale

Strengths Threats

 Prime location  Well established competitors

 “Value for money”  Competition for franchise store

 2.1.1 service  Economic slowdown

 Customer life time value PEST Analysis

 All LG electronic under one roof PEST analysis stands for "Political, Economic, Social,
and Technological analysis" and describes a framework
 Joint venture of LG and @home of macro-environmental factors used in the
environmental scanning component of strategic
Weakness
management.
 New entrant Political Environment

Business Plan for Brio-An LG Initiative Page 19

  Legislation such as the minimum wage or anti SOCIAL ENVIRONMENT
discrimination laws.
 Family, friends, colleagues, neighbours, media &
 Voluntary codes and practices.
their attitudes, interests and opinions.
 Market regulations.
 Younger population growing fast
 Trade agreements, tariffs or restrictions.
 Shopping: as a recreation
 Tax levies and tax breaks.

MARKETING PLAN
 Cultural habits changing
 Parking space –problem with M.P. – Ms. Priya Dutt o Acquiring Western look
 Government Policies - o Changing attitudes
 Tax policies o Increasing awareness and spending on
 Customs Duty -  Grooming and lifestyle
 VALUE ADDED TAX  Competitive salaries.
 Municipalities levy tax on real estate  Middle class dwelling revamped.
 Octroi  Modern conveniences natural and normal.
o Hectic lifestyles and increasing disposable
Economic Environment  Incomes leading to increasing convenience
sought.
 India second fastest growing economy in the  Convenience factors (working women, timesaving
world. products).
 Liberal, open economy.  Higher end products increasingly becoming status
 7 % Economic future Growth. symbols.
 Market conditions.
 Decline in foreign exchange reserves, both IT and TECHNOLOGICAL ENVIRONMENT
real estate.
 High disposable income  Internet and other information exchange systems
including telephone.

Business Plan for Brio-An LG Initiative Page 20

  CCTV Cameras.
 Software.
 Quality products with superior technology.
 Technology up gradation.
o Going for higher end products.
o Spread of cable and satellite television.
o Low power consumption, low service
requirement, low cost of operation, etc.

Business Plan for Brio-An LG Initiative Page 21

  
MARKETING PLAN
CUSTOMERS
A marketer can rarely satisfy everyone in a market.
Therefore, marketers start by dividing up the market
into segments. They identify and profile distinct groups
of buyers who might prefer or require various products
and services mixed by examining demographics,
psychographics and behavioral differences amongst
buyers. The marketer then decides which segment
present the greatest opportunity- which are its target
markets. For each chosen target markets, the firm
develops a market offering. The offering is positioned in
the minds of the target buyers as delivering some
central benefits.
Demographic profile for Mumbai and Delhi:
 Age – 25 and above. Our consumer will start
working at the age to 21-23 and will think about
buying various electronic goods when they have
purchasing power
 Gender- both male and female
 Location- Initially we are opening at Delhi and
Mumbai. Therefore we will be concentrating more
on the customers in these places
 Income level - 25,000 and above
Business Plan for Brio-An LG Initiative
Social class and occupation – upper middle class
and upper class
Geographic Segmentation:
Young Digerati: for Brio we are targeting couples or
single-headed households, most of them with kids, who
have decided to stay in urban centers rather than flee
to the suburbs. This sector includes a high proportional
of affluent, tech-savvy, 20-something, who tend to hold
master’s degrees and live in fashionable neighborhoods
on the urban fringe.
Demographic Segmentation:
Life stage: Dividing a market into different groups
based on which stage in the life-cycle, presented in the
table below, reflects the fact that people change the
goods and services they want and need over their
lifetime. These life stages present opportunities for the
marketers who can help cope with their major concern.
For our retail store Brio we are targeting the following
life stages-
 Bachelor stage: young, single people not
living at home. Working professionals tend to
share flats. Hence they require basic electronic
and furniture goods like refrigerator, microwave
and laptop, beds, stools and study table etc.
Page 22
  Newly married couples: Young, no children.  Generation Y (60 million) Born 1978-1994: Edgy,
Newlywed start looking for their own house focused on urban style, they are more idealistic
therefore they require electronic and furniture than generation next.
 Millennials (42 million people) born in 1995- 2000:
Social Description of Example multi- cultural, they will be text savvy, educated,
grade occupation grow up in an affluent society, and have big
spending power.
A Higher managerial Company
administrative or director
Social class is the single most used variable for
professional
research purposes, and divides the population into
B Intermediate managerial, Middle groups based on the occupation
administrative or manager
professional

like television set, A/C, laptops, home theater

sofa, beds etc.

MARKETING PLAN
 Full Nest I & II: couples with Kids. During this
stage the couple like to redecorate there
house and the electronic good are replaced
with latest goods in the market hence Brio will
be the store for them to buy LG electronics.
Generation: Each generation is profoundly influenced
by the time in which in which it grows up. For our retail
store we are focusing on
Psychographic segmentation
In this segmentation, buyers are divided into different
groups on the basis of psychological strokes,
personality traits, lifestyle or values. According to the
VALS system, Brio will target the following segments:
 Innovators- Successful, sophisticated, active,
“take charge” people with high esteem.
Purchases often reflect cultivated taste for
relatively upscale, niche oriented products and
services.

Business Plan for Brio-An LG Initiative Page 23

  Experiencers- Young, enthusiastic, impulsive
people who seek variety and excitement. Spend a
comparatively high proportion of income on
passion, entertainment and socializing.
 Strivers – Trendy and fun- loving people who are
resourced constrained. Favor stylish products that
emulate the purchases of those with greater
material wealth.
Behavior Variables
MARKETING PLAN
Behavioral Segmentation
Decision roles: People play five roles. For Brio we are
targeting the following decision makers:
 Influencers: Products like laptops, MP3 players
are used by students who do not have the
earning power. Therefore, they influence their
parents into buying them these products. Hence,
this segment is important for Brio.
 Deciders: They help in deciding upon a product/
service/ brand but may not go and buy. Brio will
Business Plan for Brio-An LG Initiative
focus on this segment as they will decide which
product/ service/ brand to choose.
 Buyer: These are the people who actually go and
buy the products. Hence, they are of uttermost
importance to Brio.
 Users: These are the people who may not actually
buy but are the end consumers of the product. If
they are satisfied with the product, then they
might become influencers, deciders and buyers
for Brio.
 Occasions: Most of the people purchase
electronics during festivals. Therefore, Brio
intends to come up with extensive promotional
schemes.
 User Status: Markets can be segmented into non-
users, ex- users, potential users, first time users
and regular users of a product. For Brio we are
targeting ex- users, potential users, first time
users and regular users.
 Usage Rate: Markets can be segmented into light,
medium and heavy product users. Brio will target
Page 24
 on heavy users who will buy LG and @home
products only once but in large quantities. For
e.g. People looking for setting up the whole house
and hence purchase LG television, refrigerators
along with the furniture.
 Loyalty Status: Brio is targeting hard core loyal,
split loyal, shifting loyal, and switchers.

Sequential Segmentation

 Sophisticates- These class of customers want

speed in maintenance and repair, product
customization and high technical support. Brio
will be one shop stop for maintenance repair and
customization of LG and @home products.
 Price oriented customers- They want through
lowest price.

Business Plan for Brio-An LG Initiative Page 25

 MARKETING PLAN
COMPETITION
Product Category
Product Category

Washi Washi
Compan Colored Compa Colored
Refrigera ng Refrigera A ng Other
y Televisi AC Others ny Televisi
tor Machi tor C Machi s
on on
ne ne

BPL   --   Onida  ---   

BenQ Panaso
 -- -- --      
Corp. nic

Blue Star Philips

--   -- --  -- -- -- 
Ltd. India

Bose Samsu
-- -- -- --      
Corp. ng

Carrier Sansui  -- -- -- --
--   -- --
Aircon
Sony
 -- -- -- 
Electrolu India
x-
--     Videoc
Kelvinato     
on
r
Voltas --   -- --
Godrej --    
Whirlp
Haier --    
     ool
India
Toshib
    
Business Plan for Brio-An LG Initiative a Page 26
 Hitachi --   -- --
Ltd

MARKETING PLAN
Consumer Durable Chain Stores

Type Of Products

Store AV Products
(TV, Home
Home
appliances
Kitchen
Appliances
Personal
Appliances
Technological
Gadgets and
Theatre, Music (Washing (Microwave, (Electric Shaver, Accessories
Players etc.) Machine, Mixer, Grinder Hair Dryer etc.) (Computers,
Refrigerator etc.) Hard disks etc.)
etc.)
Croma Retail     
Vijay Sales    -- 
Plug In/Next    -- --
(Videocon)

Godrej Lifestyle    -- --
Vivek’s    -- 
E-Zone     

Business Plan for Brio-An LG Initiative Page 27

 MARKETING PLAN
NICHE
Through Brio, LG proposes to bring to its customers its
entire consumer durable range of products under a
single roof. It will be an exclusive range of integrated
LG and @home products which will bring together
elegance of @home’s furnishings with the superior
expertise of LG. The retail format of Brio will be a novel
concept to enter the consumer durable market. It aims
to create an appeal among customers seeking to
enhance any living space. It proposes to target an
audience that looks for the perfect mix of technology
products and class interiors. It is expected that the
footfall of such a retail outlet will also be higher than
any of the present LG stores indirectly boosting the
sales of LG products.
STRATEGY
Products & Services have been mentioned in
Chapter II
Business Plan for Brio-An LG Initiative
Promotion/Communication Strategy or Mix
Brio will make judicious usage of media channels in
order to reach out to the target consumers. The target
consumers being working professionals and persons
looking to make provisions for a living space – be it in
the office or the home. Hence, the focus media will be
primarily the print, online and television media
channels also including outdoor advertising before and
during the launch of the stores. The websites of LG as
well as @home can also be utilized in order to create
awareness with existing consumers of both brands.
Social and Online media can also be utilized effectively
in order to tap into the growing base of young
consumers who are seen to possess an increasing
amount of disposable income.
Placement of print advertisements in Interior Design
Magazines like Interiors, Good Home, Inside Outside,
Good Housekeeping etc. which reaches out to interior
decorators and homemakers alike. These are the key
Page 28
influencers when it comes to making decisions
regarding purchases for the home or other living
spaces.
LG and @home’s respective websites will be
hyperlinked to a simulated walk through of the
proposed Brio store in the months leading up to the
store launch in each of the two cities. Through this
simulation, customers will be able to get a feel of the
store as well as the benefits they can avail of by visiting
the same. Thereby creating hype about the imminent
tie up which will increase footfalls in the store. This
online store will continue to feature upcoming
improvements and services that will be launched at the
stores. A consumer can be made aware of the new
offers before they are launched so that they can be well
informed and prepared to make purchases at the
appropriate time.
Online banners and Floating banner Ads can also be
placed on websites that are related to design and
luxury goods. Thus higher income individuals who
consume these goods can browse through
MARKETING PLAN
the new range of integrated products and services that
is being offered by LG and @home.
Business Plan for Brio-An LG Initiative
Television advertisements regarding the new concept
store as well as the innovative technologically products
can be placed on lifestyle channels like Discovery
Travel and Living, NDTV Good Times as well as other
entertainment channels like Star World, Zee Café, NDTV
24x7, CNN IBN, AXN, NDTV Imagine, Star Plus, Sony
etc. which have a large viewership numbers.
In the months leading up to the launch of Brio, outdoor
advertising like banners, hoardings etc can be utilized
so as to create an interest in the concept store and its
offerings. The new joint venture can be played up in the
advertising.
LG would like Brio to be positioned as the go to store for
consumers looking to create living spaces that are
aesthetically pleasing while also incorporating user
friendly technology which further simplifies the daily
living rituals of every consumer. The store should be
seen as a place which houses products that keep the
needs of the consumer in mind all the while maintaining
versatile design principles that seamlessly fit into every
home and office. The brand should also be seen as a
socially responsible one which stocks products that are
environment friendly thereby keeping in mind not just
the consumer of today but also the future consumers of
tomorrow by trying to reduce the use of hazardous
materials in the creation of the products.
Keeping in mind the existing graphic and color schemes
of both companies, Brio, which is a Joint Venture of LG
Page 29
and @home, will maintain the red and white color
schemes throughout its communication and advertising
channels. Hence, the color scheme of the interior
design at the store as well as the branding, logo,
letterheads, brochures and signage will continue to
adhere to the same. A representation of the logo has
been attached to this copy of the business plan.
Individuals who are repeat consumers will automatically
be offered a customer loyalty card which automatically
enrolls them into a customer loyalty program that
offers them exclusive rewards and benefits based on a
point system. Being a loyalty card holder also entitles
them to privileged servicing of products at a minimum
price.
A loyalty card holder will also be invited to the store in
order to avail of periodical offers and benefits at least a
week before other customers. This will enable them to
avail of products not yet available to the general public
thereby creating a relationship with the consumer
which makes them feel valued and important.
Various contests and events can also be held to retain
the interest of the consumers. Brand contact points are
also very important as it is at the time of the purchase
or just prior to it that the customer is most influenced.
Thus point of sales must be impeccable which include
display material as well as helpful and friendly
salespeople.
Business Plan for Brio-An LG Initiative
MARKETING PLAN
The whole idea is also to maintain brand salience and
build brand feeling and resonance through the
Integrated Marketing/Communication Mix.
Price
As LG products are available in other retail outlets as
well, it is imperative that Brio has competitive pricing
so that the customer makes the final purchase from
Brio and nowhere else. Also considering the tie-up with
@home prices have to be assigned accordingly so as to
provide the customer with some of the best price
options.
At Brio, all products, be it by LG or @home will be
affordably priced at 10% less than the normal Market
Retail Price (MRP). In comparison to other retail outlets
where LG products are sold with other competing
brands, the pricing at Brio will have a competitive
advantage. Considering LG will be manufacturing and
retailing itself there will be no middleman costs
occurring which gives LG the option to sell its products
at such rates and still make decent profits.
There will be various timely discount schemes like when
a customer buys an LG product from Brio; they can
avail of a 10% discount on their next purchase from all
Brio stores. This is mainly to encourage customers to
Page 30
buy their LG products from Brio only and not any other outlets and stockist in Mumbai where Brio can source
retail outlets. the products from.

During festivals like Diwali and New Years, there will be

special ‘free gift’ offers, such as ten computer
MARKETING PLAN
accessories/printer-scanner-photocopier free on the
purchase of an LG notebook or a table lamp free with a New Delhi
study table, etc.
The second store will be located in New Delhi as LG has
existing manufacturing operations in Greater Noida,
Combo offers: At Brio there will there will be combo
New Delhi. @home has a retail outlet and stockist in
offers such as an LG refrigerator and a dining table
Ghaziabad from where Brio can source the products
set/kitchen panel by @home for a particular amount
from.
which is lower than the combined MRP of both products.
Other combo offers could include an LG LCD TV with a Long-Term: In the roll out phase, Brio plans to expand
@home wall unit, etc. to cities like Bangalore, Chennai, Hyderabad, Pune,
Chandigarh and Kolkata depending on the success of
Proposed Location
the Mumbai and New Delhi retail outlets. With this
In the initial stage, Brio is proposed to have two stores endeavor, Brio will make its presence felt throughout
opening almost simultaneously located in the following the country, be it north, south, east or west, catering to
cities: all its target audience as well as tapping and creating
potential markets for itself.
Short-Term:
Distribution Channel
Mumbai
Brio will follow the Producer to Customer method of
The first store will be located in Mumbai keeping in distribution. This is the simplest and shortest channel
mind the existing LG manufacturing operations in Pune in which no middleman is involved and producers
(Ranjangaon), Maharashtra. @home has its own retail
Business Plan for Brio-An LG Initiative Page 31
directly sell their products to the consumers. It is a fast in working condition and the customer is satisfied with
and economical channel of distribution. Under it, the the functioning of the product.
producer or entrepreneur performs all the marketing
Depending on the profitability of the store, Brio will
activities himself and has full control over distribution.
gradually introduce online purchasing options as well
A producer may sell directly to consumers through
on its website, wherein the customer can see the LG
door-to-door salesmen, direct mail or through his own
products or the simulation of interior furnishings and
retail stores. Big firms adopt this channel to cut
place orders instantly. Online payment facilities will be
distribution costs and to sell industrial products of high
made available, thus making the online purchase
value. Small producers and producers of perishable
experience a smooth transaction.
commodities also sell directly

to local consumers. Thus for Brio, LG and @home will OPERATIONAL PLAN
follow the producer to consumer distribution channel.

The manufacturing units from where the products will LOCATION

be sourced for the retail outlets have been touched
upon in the proposed location section earlier in the
document.
After a particular purchase the customer can take the
product(s) himself or if wanted Brio will have its sales
representatives deliver the product(s) to the customer’s
place. In cases of home furnishings if orders have to be
placed, they too will be sent directly to the customer
destination after the allotted time period. Door step
delivery will thus be an option at Brio. This also includes
an installation procedures if involved, till the product is
The proposed location for the Brio stores has been discussed
earlier in the Marketing Plan section.
Physical requirements
 Amount of space: 10000-15000 square feet +
Parking area of around 5000 square feet
 Type of building: Vertically integrated, will be
using existing building infrastructure
 Zoning: High streets of the metros

Business Plan for Brio-An LG Initiative Page 32

ENVISIONED STORE STRUCTURE  Bullet resistant glass
 CCTV (security)
Brio will have spacious set-ups with two floors of the  Cash registers and counters
store displaying LG and @home products. Three fourth  Display units and showcases
area of the first floor will have the entire LG product  Bags, Pricing/Tagging Gun
range on display. The remaining one fourth area on the  Lights/Electricity
floor will exhibit the @home furnishing range choicely  Air Conditioners
 Other security equipment
picked to compliment LG’s consumer durables. The
second floor will have various simulations of home and SURROUNDING ENVIRONMENT
corporate expanses which intend to give the customers
a view of what the products could look like in such The stores will aim to be strategically located in up
environments and also giving them the option to buy or market areas in both the metros, targeting high income
order a simulated set up. This seeks to provide a unique consumers. Thus the proposed areas for the LG retail
and satisfying experience to each and every customer stores are Bandra and South Extension in Mumbai and
that sets foot into the retail store, making them want to Delhi respectively.
come back to Brio for their

OPERATIONAL PLAN
next purchase as well. The store infrastructure and
atmosphere will be such that it helps form an
association with the customers. PRODUCTION/SUPPLIERS

The products for both the LG retail outlets will be

EQUIPMENT
produced and transported from the LG manufacturing
Necessary equipment required for proper functioning of units/factories located in Pune and Greater Noida.
the retail store will be as follows: @home products will be sourced from the closest retail
store or stockist. We will identify the key suppliers and
 Barcode ( Printers and readers, scanners and
software)

Business Plan for Brio-An LG Initiative Page 33

source the products accordingly. There will be back-up
suppliers in case of short-term delivery problems.
LEGAL ENVIRONMENT
Health, workplace or environmental regulations
Brio’s working hours will be from 10 a.m. to 10 p.m. all
seven days a week. Staff will work from 9 a.m. to 11
p.m. The lunch break will be divided among the staff
from 1- 3 p.m. and a tea break from 4-5 p.m. All
employees at Brio will receive the same health benefits
as the LG employees.
 Trademark for the Brio logo and layout
 Copyright for any audio visual communication
Licensing and bonding requirements
 Brio is a Joint Venture between LG and @home
 Stakes involved: LG will have 70% and @home
will have 30% of Brio
The following are the requirements that the companies
need to full-fill to enter into a joint venture:
JOINT VENTURE AGREEMENT BETWEEN

Insurance policies
At Home, Nilkamal Ltd, Nilkamal House, 14th Street,
Property insurance that will provide protection against
MIDC, Andheri(E), Mumbai- 400 093.
most risks to the property, such as fire, theft and some
weather damage. This includes specialized forms of And
insurance such as fire insurance, flood insurance,
LG Electronics India Pvt Ltd, Plot no- 51, Surajpur Kasna

OPERATIONAL PLAN
earthquake insurance, home insurance or boiler Road, Greater Noida- 201 306 (UP)
insurance.

Liability Insurance is a part of the general insurance

BACKGROUND
system of risk financing.
A. The Members wish to enter into an association of
Trademarks, copyrights, or patents
mutual benefit and agree to jointly invest and set
up a joint venture enterprise.
 Permission for LG and @home logos

Business Plan for Brio-An LG Initiative Page 34

 B. The terms and conditions of this Agreement sets solutions to their living environment. This innovative
out the terms and conditions governing Brio. venture will help strengthen its hold in the retail market
LG and @home will have to acknowledge the following and better the brand perception in the minds of the
to start the joint venture: consumers. The ultimate objective of Brio is thus to
build long-lasting relationships with its customers
Formation
through a unique and satisfying experience of LG’s
By this Agreement the Members enter into a joint innovative products and services.
venture (Brio) in accordance with the laws of India. The
Term
rights and obligations of the Members will be as stated
The venture will begin on April 30th 2010 and will
in the applicable legislation of the Indian subcontinent
continue to be effective and in full force for two years
otherwise provided in this document.
or until terminated as provided in this Agreement.
Name
Place of Business
The business name of the venture will be Brio. Initially
The principal office and legal address of the business
we are setting it up at South Extension in Delhi and
of the venture will be located at Mumbai and New Delhi
Bandra in Mumbai. After looking at the profitability of
or such other place as the Board Members may from
the store we will set up more retail stores at other
time to time designate.
metros and mini metros.

Purpose The LG and @home management will decide upon

major issues concerning the venture. Unanimous
LG has always delivered quality to the consumer approval will be required as and where indicated in this
through its Shoppes and exclusive stores. With Agreement.
proposes to set up a retail chain in

association with the high end home lifestyle brand

(@home) so as to distinguish itself from its competition
by integrating superior technology and quality home
furnishings in order to provide consumers with futuristic

Business Plan for Brio-An LG Initiative Page 35

 OPERATIONAL PLAN
Delhi respectively. The storing facility (go downs) would
Capital Contributions be the basement of the outlet itself.

Each of the Members has contributed to the capital of

the Venture, in cash or property (credit) in agreed upon
value as At Home will contribute 30% and LG will bring
70% of the capital. CREDIT POLICIES
PERSONNEL
1. Cash, Credit & Debit Card facility: Payment can
Each store will have approximately 25-30 employees
be made in cash or card at the time of the
per outlet. The estimation is made keeping in mind
purchase
services right from the store manager to the security
2. Financing options: Brio offers Easy Monthly
personnel.
Installment (EMI) facilities to its all its customers
The Sales team will include professionally trained staff. for products above Rs. 50,000. This is an industry
They will be traditional Brio employees having requirement and expected by our clientele.
knowledge about both LG and @home products and 3. Prompt payment discounts will be offered on the
services. total amount of both LG and @home products if
paid by cash or card.
INVENTORY PLAN 4. Value Added Tax (VAT) will be charged as per
norms.
The entire LG range and the selected @home goods will
5. Warranty & Guarantee
be displayed in the store. LG products will be stocked in
a part of the retail outlet and @home goods will be
available on order so will not require much stocking at
Brio. As mentioned earlier, the LG goods will be
transported from the main factory in Pune (Ranjangaon)
and Greater Noida to the go downs in Mumbai and New

Business Plan for Brio-An LG Initiative Page 36

 In case any of the above persons is lost or
incapacitated, the immediate next senior will take over.
In this case, it would be the Asst. General Manager.

Vice President/ General Manger: Involved in the main

strategizing part which includes what kind of retail
chain to introduce, where to launch it, goods offered in
MANAGEMENT & ORGANIZATION the store, etc.

BRIO MANAGEMENT

As the CEO of LG will be the same for BRIO, the

business on a day-to-day basis will be handled by Vice
President (Retail), General Manager, Zone Manager,
Regional Manager, Branch Manager, Assistant Branch
Zone Manager: Involved in the key functioning of the
Manager and Sales.
four zones- north, south, east, west. In charge of
These managers bring the experience of deciding where the store will be situated, what color will
‘customization’ to customers who visit the store by be used, which brand, etc.
attending to their individualistic needs and providing
Regional Manager: Involved in deciding strategic
them a holistic experience for lifestyle. A manager
regions for the location of the stores to enable high
should have business knowledge which is one of the
accessibility.
most important competencies for the success of such a
retail chain. The next important competency is Branch Manager: Involved in display of items in every
customer service which includes meeting and particular branch, helping distribution to the respective
exceeding the expectations of the consumers. Also branches and warehousing.
qualities such as effective leadership, organization and
integrity play an important role. Asst. Branch Manager: Helping the Branch Manager to
conduct all the above mentioned activities and
replacing him in case of his absence.

Business Plan for Brio-An LG Initiative Page 37

Sales: Involved in extensive market research and  Shareholders
keeping track of sales of the goods at every retail store.
 Investors
Board of Directors:

 3 executives from LG

 2 executives from @home

MANAGEMENT & ORGANIZATION

Business Plan for Brio-An LG Initiative Page 38

 MANAGEMENT & ORGANIZATION
BRIO ADVISORY BOARD

Business Plan for Brio-An LG Initiative Page 39

No business is too small to benefit from having an
Advisory Board and it is such a powerful management
tool that no small business should operate without one.
Unlike a one-time or casual event, the Advisory Board is
composed of people with a genuine interest in the
business and a desire to see it do well. It is a
management think tank. The Advisory Board members
will serve as a sounding board, a source of ideas and
expertise - giving honest advice.
The Professional & Advisory Support Team for Brio
would include the following:
 Board of Directors
 Management Advisory Board
 Attorney
 Accountant
 Insurance Agent
 Banker
 Consultant or consultants
 Mentors and key advisors
For Brio our advisory board we are thinking of including
people like
Business Plan for Brio-An LG Initiative
Kishore Biyani
MD, Pantaloon Retail
 Y C Deveshwar
ITC Chairman
Attorney
For Brio we have decided to use LG legal department
for set up Brio. But if for some reason LG refuses then
we will hire Rights & Marks for helping us with the legal
documentations.
About Rights &Marks
Rights & Marks founded in 2000 by Mrs.S. Balajanaki is
a leading international law firm. Practices patent,
trademark, and copyright law with services ranging
from International patent prosecution, International
trademark prosecution, Intellectula property litigation,
and Intellectual property contacts and license
agreements. A registered patent attorney can also
assist you with Patent Cooperation Treaty (PCT)
Procedure, and the JMadrid International trademark
Protocol.
MANAGEMENT & ORGANIZATION
Rights & Marks have Practice offices in the City of
Chennai, Bangalore, Hyderabad, Coimbatore, Madurai,
London, and Dubai. Our core values include a strong
Page 40
focus on helping our clients and our own people to
achieve their ambitions. We believe in good
communication as the key to cementing successful Feature
relationships, whether with our clients, or across the
firm. In a competitive business environment, damage to your
property or goods can have an adverse impact on your
Our lawyers are supported by 40 bar legal members of profitability. Insurance is an essential to protect
staff, ensuring that they have the resources they need yourself against losses that could devastate your
to deliver a service of the highest quality. In addition to business.
the usual administrative support, the firm attaches Reliance has provided Reliance Standard Fire and
great importance to providing its lawyers and clients Special Perils Policy with a combination of both
with first-class technical and research/information standard and optional features so that you can choose
facilities. Our librarians and researchers have access to the cover which best suits your business.
an impressive range of databases providing them with
on-line international legal and business information. Property that can be covered under the Reliance
Accurate information on any legal or commercial matter Standard Fire and Special Perils Policy includes:
is therefore available on request.
The firm has long recognized the integral role played by Industrial/manufacturing risks
many industries in our service delivery and continues to
Property located outside the compound of Industrial/
make significant investments in this resource.
Manufacturing risks, namely:
Insurance Agent
dwellings, offices, hotels, shops, etc
For Brio store we require a comprehensive insurance
utilities
policy which will cover the store from fire, thefts etc.
Therefore Reliance Standard Fire and Special Perils
storage risks
Policy
tank farms/gas holders
Reliance Standard Fire and Special Perils Policy

Business Plan for Brio-An LG Initiative Page 41

 
MANAGEMENT & ORGANIZATION 

Key Benefits  Explosion / Implosion

Customized Coverage
 This policy provides comprehensive coverage to
your property
 You can enhance your cover with a range of add-
ons
 Range of add-on covers to enhance customization
 You can also exercise the option to delete a few
covers you may not need
 Multiple policy options comprising floater policy,
declaration policy and floater declaration policy
Attractive discounts
 Long term polices for 'dwellings' with attractive
long-term discounts
 Discounts available if you choose to delete a few
covers -pls confirm
 Discounts for favorable claims experience and
risk improvement measure such as installation of
fire extinguishing appliances
 Aircraft Damage
 Riot, Strike and Malicious Damage
 Storm, Cyclone, Typhoon, Tempest, Hurricane,
Tornado, Flood and Inundation
 Impact Damage
 Subsidence and Landslide including Rockslide –
demolition, construction, structural alterations
or repair of any property or ground works or
excavations
 Bursting and/or Overflowing of Water Tanks,
Apparatus and Pipes
 Missile Testing Operations
 Leakage from Automatic Sprinkler Installations
excluding loss, destruction or damage
 Bush Fire
 Architects, surveyors & consulting engineers
fees upto 3% of claim amount
 Debris removal upto 1% of claim amount

Policy Coverage
 Fire Policy Options
 Lightning


Business Plan for Brio-An LG Initiative Page 42

Each business has its unique requirements and to  Loss of rent clause
customize the policy to your business needs we offer  Additional expenses towards rent for an
the following covers at an extra premium: alternative accommodation
 Earthquake (fire & shock)  Start-up expenses

MANAGEMENT & ORGANIZATION

 Architects, surveyors & consulting engineers fees
in excess of 3% of claim amount
 Debris removal in excess of 1% of claim amount
 Deterioration of stocks in cold storage due to
o Accidental power failure consequent
to damage at the premises of power station
due to an insured peril
o Change in temperature arising out of loss or
 Molten metal spillage
The Reliance Standard Fire and Special Perils Policy
comes with the option of choosing from the following
variants:
 Floater Policy – appropriate for stocks at various
locations under a single sum insured
 Declaration Policy – takes care of frequent

damage to the cold storage machinery in fluctuations in stock/stock values

 Floater Declaration Policy – combines the features
the insured premises due to operation of
insured peril of both floater and declaration policies

 Forest fire
 Impact damage due to insured's own rail/ road
vehicles, forklifts, cranes, stackers and the like
and articles dropped there from
 Spontaneous combustion
 Omission to insure additions, alterations or
extensions
 Spoilage material damage
 Leakage and contamination
 Temporary removal of stocks clause
Business Plan for Brio-An LG Initiative Page 43
 more likely to purchase products and services
from the business well into the future. This can be
initiated by can start the relationship building
process by getting to know the customers
personally when they visit the store by simply

CUSTOMER LIFETIME VALUE

talking to them and getting to know their names.

In marketing, customer lifetime value (CLV), lifetime

customer value (LCV), or lifetime value (LTV) and a new
concept of "customer life cycle management" is the
present value of the future cash flows attributed to the  Up-selling to current customers: As each
customer relationship. Use of customer lifetime value customer makes their routine purchases from the
as a marketing metric tends to place greater emphasis business their net present value can be increased
on customer service and long-term customer by increasing the profitability of their orders and
satisfaction, rather than on maximizing short-term purchases. Customer lifetime value increases
sales. At Brio, we will have great emphasis on CLV. dramatically if one can increase the total
expected revenue on the average customer’s
To grow market share in the highly competitive retail
purchase. Sometimes the up-sell can be as simple
arena, you need an energized frontline staff, with the
as impulse items at the register or related
right product knowledge, cross-selling and referral
product listing in the online shopping basket or
skills, and a relationship-based approach to your
online checkout sequence.
customer and their needs. Some of the ways of
attaining CLV at Brio will be as follows:

 Building relationships: Customer lifetime value is  Follow-ups: Following up with customers after
influenced greatly by the duration that the sales or inquiries are important. This method of
customer remains a customer. If they feel that increasing customer lifetime value attempts to
they have a relationship with Brio they will be increase the regularity of customer patronage

Business Plan for Brio-An LG Initiative Page 44

 while simultaneously working on the relationship.
When a customer makes a purchase they are
more likely to come back for more, come back
sooner, and more often to refer other customers
to you if you follow-up with them after their
purchase. Email communication is most effective
as it requires little overhead costs and can be
personalized as much or little as you wish. Brio
intends to integrate this practice in its
functioning.
CUSTOMER LIFETIME VALUE
 Offering support and being responsive: Making
yourself available to the customer increases the
likelihood of repeat business and referrals. Both
of these desired outcomes increase customer
lifetime value and minimize loss of customers due
to their possible disenchantment of the business-
customer relationship.
Business Plan for Brio-An LG Initiative
 Communication: Communicating to customers
through newsletters in print or via email. This will
reacquaint customers with Brio products and
services and encourages an increase frequency of
customer patronage.
 Referral programs: Offering referral programs to
current customers targets the value of the
customers to increase shopping frequency while
simultaneously lowering costs on customer
acquisition. If current customers have an
incentive in referring new customers such as a
discount; they will be more likely to be a more
frequent patron. The costs of discount are offset
by cost savings of acquisition and thus the net
present value of current customers’ increases as
does the entire customer base.
Page 45
 START UP EXPENSES & CAPITALIZATION
 Retaining profitable customers: Brio will data
mine its most profitable customers and offer
programs to retain them. Retention costs will lead
to long durations of patronage.
 Loyalty programs: The Brio club similar to the LG
club can be started, wherein various membership
privileges can be provided to the customers such
as earning reward points on purchase, earning
bonus points on any existing Brio product the
customer may have, refer and earn bonus points,
complimentary insurance coverage, regular
performance check of your Brio products,
discounts on annual maintenance contract,
special invites for free service camps, special
offers from Brio and associated brands and
regular updates on new product launches.
Through the above mentioned pointers Brio intends to
create a meaningful and long-lasting Customer Lifetime
Value.
Business Plan for Brio-An LG Initiative
Start-up costs election statement.
If you elect to amortize your start-up costs, attach a
separate statement that contains the following
information.
 A description of the business to which the start-up
costs relate.
 A description of each start-up cost incurred.
 The month your active business began (or was
acquired).
 The number of months in your amortization
period (which is generally 180 months).
Brio an LG initiative:
It’s an electronic retail store for LG products. To give
the store an edge LG has tied with @home, a furniture
franchise store. Apart from having its presence in
various electronic megastores, LG also has its exclusive
retail stores and which extend to loyal customers be it
for the products or services. Along with its current
target audience, LG wants to cater to a higher income
group in a different way, increasing its visibility and
improving its perception in the process.
Expenses required in the business
Page 46
 1. Getting a Lease for the store: If you get a lease
for business property, you recover the cost by
amortizing it over the term of the lease. The term
of the lease for amortization purposes generally
includes all renewal options (and any other period
for which you and the lesser reasonably expect
START UP EXPENSES & CAPITALIZATION
the lease to be renewed). However, renewal
periods are not included if 75% or more of the
cost of acquiring the lease is for the term of the
lease remaining on the acquisition date. We
intend to lease the store in Mumbai and Delhi by
the end of December 2009.
2. Cost incurred for the store layout.
3. Cost for stimulated rooms
4. Goodwill for the brand Brio: This is the value of a
trade or business based on expected continued
customer patronage due to its name, reputation,
or any other factor.
5. Going concern value: This is the additional value
of a trade or business that attaches to property
because the property is an integral part of an
ongoing business activity. It includes value based
on the ability of a business to continue to function
and generate income even though there is a
change in ownership. It also includes value based
on the immediate use or availability of an
acquired trade or business, such as the use of
Business Plan for Brio-An LG Initiative
earnings during any period in which the business
would not otherwise be available or operational.
6. Workforce in place: This includes the composition
of a workforce (for example, its experience,
education, or training). It also includes the terms
and conditions of employment, whether
contractual or otherwise, and any other value
placed on employees or any of their attributes.
7. Business books and records, etc: This includes the
intangible value of technical manuals, training
manuals or programs, data files, and accounting
or inventory control systems. It also includes the
cost of customer lists, subscription lists, insurance
expirations, patient or client files, and lists of
newspaper, magazine, radio, and television
advertisers.
8. Patents, copyrights, etc. This includes package
design, Brio Logo, jingle etc.
9. Customer-based intangible. This is the
composition of market, market share, and any
other value resulting from the future provision of
goods or services because of relationships with
customers in the ordinary course of business. For
example:
 A customer base.
Page 47
  A circulation base. 13. Any interest in a corporation, partnership,
 An undeveloped market or market growth. trust, or estate.
 Insurance in force. 14. Any interest under an existing futures
 A mortgage servicing contract. contract, foreign currency contract, notional
principal contract, interest rate swap, or similar
 An investment management contract.
financial contract.
 Any other relationship with customers
15. Any interest in land.
involving the future provision of goods or
16. Computer software for Brio like billing
services.
machine and software from IBM.
10. Supplier-based intangible. This is the value
17. An interest under either of the following.
resulting from the future acquisition of goods or
a. An existing lease or sublease of tangible
services used or sold by the business because of
property.
business relationships with suppliers.
b. A debt that was in existence when the
 A favorable credit rating.
interest was acquired.
 A favorable supply contract. 18. Certain transaction costs incurred by
 A favorable relationship with distributors parties to a corporate organization or
(such as favorable shelf or display space at reorganization in which any part of a gain or loss
a retail outlet) is not recognized.
11. Government-granted license, permit, etc.
This is any right granted by a governmental unit
or an agency or instrumentality of a
governmental unit. For example, vehicle for
transformation for LG products to the store,
license for display board
12. Franchise, trademark, or trade name. You
must amortize franchise, trademark or trade
name purchase or renewal costs, other than
certain contingent payments that you can deduct
currently.

Business Plan for Brio-An LG Initiative Page 48

Name of the company Brio

REFERENCES/BIBLIOGRAPHY
April May June July August Sept October Nov Dec January Feb March
Revenue
10,00,0 5,00,0 7,00,00 3,00,0 2,00,0 3,00,00 50,00,00 4,00,0 1,00,0 8,00,00 2,00,0 5,00,00
LG Products
00 00 0 00 00 0 0 00 00 0 00 0
20,00,0 2,00,0 5,00,00 5,00,0 5,00,0 7,00,00 50,00,00 1,00,0 7,00,0 5,00,00 4,00,0 2,00,00
At home Products
00 00 0 00 00 0 0 00 00 0 00 0
30,00, 7,00,0 12,00, 8,00,0 7,00,0 10,00, 1,00,00, 5,00,0 8,00,0 13,00, 7,00,0 7,00,0
Total revenue
000 00 000 00 00 000 000 00 00 000 00 00
Employee related
expenses
2,00,00 2,00,0 2,00,00 2,00,0 2,00,0 2,00,00 2,00,0 2,00,0 2,00,00 2,00,0 2,00,00
Salary expenses 2,00,000
0 00 0 00 00 0 00 00 0 00 0
Wages expenses 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000
Outside services (when
employee go out for official 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000
work)
Meals & Entertainment 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000
Security 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000
Other Professional Fees 10,000
Client Entertainment 5,000 5,000 5,000 5,000 5,000 5,000 10,000 5,000 5,000 10,000 5,000 5,000
Office expenses
3,00,00 3,00,0 3,00,00 3,00,0 3,00,0 3,00,00 3,00,0 3,00,0 3,00,00 3,00,0 3,00,00
Rent 3,00,000
0 00 0 00 00 0 00 00 0 00 0
2,00,00
Grand Opening
0
Transportation
Telephone 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000
3,000
Supplies (office and operating)
Office Cleaning 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000
Dues and Subsciptions 500 500 500 500 500 500 500 500 500 500 500 500
Repairs and maintenance 10,000
Website hosting 250
4,00,00 4,00,00
Advertising
Business Plan 4,00,000
0 for Brio-An LG Initiative 0 Page 49
Security
1,00,00
Accounting and legal
0
“Marketing Management: An Asian Perspective”
by Philip Kotler, Kevin Lane Keller, Abraham Koshy,
Mithileshwar Jha (13th Edition)
“LG India”
http://www.in.lge.com/
“LG to add 25 more outlets by 2009” (as appeared in the
‘Financial Express’)
www.financialexpress.com/news/lg-to-
add...outlets...2009/345617/
“Industry Information – Consumer Durables”
http://info.shine.com/Industry-Information/Consumer-
Durables/902.aspx
“Consumer electronics cos. witnessing 30% growth in sales”
(as appeared in the ‘Economic Times’)
http://economictimes.indiatimes.com/news/news-by-
industry/cons-products/electronics/Consumer-electronics-
cos-witnessing-30-growth-in-sales/articleshow/5262373.cms
“India records highest growth for LG Electronics” (as
appeared in the ‘Business Line’)
http://www.blonnet.com/2009/06/24/stories/2009062450530
500.htm
“Consumer Markets”
http://www.ibef.org/economy/consumermarket.aspx
“LG Slogan – Life’s Good”
http://www.lge.com/about/corporate/slogan.jsp
Business Plan for Brio-An LG Initiative
“India's Consumer Electronics Industry Scales New Heights”
http://www.eetindia.co.in/ART_8800470743_18000
07_NT_5e6993e6.HTM
“The Consumer Durable Market”
http://retailmantras.blogspot.com/2009/09/consum
er-durable-market.html
“Consumer Durables”
http://ibef.org/download
%5Cconsumer_durable_28feb_0808.pdf
“Consumer Durable Industry in India”
http://www.cci.in/pdf/surveys_reports/consumer-
durables-sector.pdf
“LG Product Listing”
http://www.in.lge.com/product/index.aspx
“Industry Information – Retail”
http://www.ibef.org/industry/retail.aspx
“Consumer Durables Chain – Review”
http://india.retailmantra.com/2009/01/consumer-
durables-chain-review.html
Page 50
 7. Do you think that LG is innovative? (New products,
APPENDICES features or services regularly).
a) Yes b) No
8. Do you think LG supports the community?
CONSUMER PREFERENCE SURVEY
a) Yes b) No
Name: 9. Do you think LG practices good corporate ethics?
Age: a) Yes b) No
Gender:

All you have to do is answer the following questions in a YES

or NO:

1. Do you think LG is safe to use?

a) Yes b) No
10.Do you think LG has a healthy environment and a
2. Do you think LG is consistent in delivering on the
good employee relationship?
promise it makes?
a) Yes b) No
a) Yes b) No 11.Would you recommend LG to someone?
a) Yes b) No
3. Do you think the products offered by LG are well- 12.Do you research before going in for a particular
designed? brand?

a) Yes b) No a) Yes b) No

4. Do you think LG offers good value for money? 13.Would a discount offer on a particular brand change
a) Yes b) No your decision?
5. Does LG respond to your changing needs as a
a) Yes b) No
customer?
a) Yes b) No 14.Are you loyal to any one particular brand? If yes do
6. Does LG satisfy your needs through the variety of not answer question no. 15 and 16.
products they provide? a) Yes b) No
15.Does the reputation of the brand matter to you while
a) Yes b) No
buying a product?
a) Yes b) No

Business Plan for Brio-An LG Initiative Page 51

 16.Have you come across other bands which provide
better products that LG?
a)Yes b) No
17. Would you be interested in purchasing furnishings
which integrate technologically innovative electronic
products with aesthetic designs?
a)Yes b) No
18.Would you visit a store which sold such products if it
housed only a single brand?
a)Yes b) No

APPENDICES

Business Plan for Brio-An LG Initiative Page 52

 APPENDICES

Business Plan for Brio-An LG Initiative Page 53

Business Plan for Brio-An LG Initiative Page 54