PROJECT OF MAKING A NEW BUSINESS PLAN

OF DATA MANAGEMENT AND BUSINESS

ANALYTICS SOFTWARE COMPANY----- DMAS

SUBMITTED TO- Submitted by:

DR. RITESH SRIVASTAVA Shubhadip Biswas
IILM-GSM

PGDM 10-12

SEC- A

ROLL NO.-FT-10-948
 ACKNOWLEDGEMENT

The satisfaction and euphoria that accompany the successful

completion of any task of dream would be incomplete without
mentioning the name of the people whose constant guidance and
encouragement has crowned all our efforts with success.

Firstly I would like to thank Dr. RITESH SRIVASTAVA for giving

me his precious time, encouragement and guidance that helped
me a lot to making this proposal compact and meaningful.

Last but not least I would like to thank all those people for their
immense cooperation who encouraged me in any way and
without support of those people this project never be completed
successfully.
Most specially a special thanks to my family and friends.
Plan Outline

 1. Executive Summary
o Objectives
o Mission
o Keys to Success
 2. Company Summary
 3. Products and Services
 4. Market Analysis Summary
 5. Strategy and Implementation Summary
 6. Management Summary
 7. Financial Plan
 8. Analysis
Executive Summary

This business plan outlines the strategy for sales of software

solutions to medium-sized companies and franchises. DMAS will
act as the direct sales arm of a software manufacturing firm. We
expect a high degree of profitability based on our plan to key in
on businesses that have already expressed the need for such
services and products to the software manufacturer. Our
management expertise in dealing with corporate decision makers
and our partner's reputation will be the cornerstone of our
success. Our new software solution offers four specific versions
that, while still being totally customizable, are also specifically
targeted to groups such as IT, Finance, Consulting, and
Telecommunications.

1.1 Objectives

 Market a data management & business analytics software

package to corporate managers and achieve profit of rupees
5 lakh in year one.
 Customize the software to the individual needs of each
client.
 Provide training and follow-up service to each client.
1.2 Mission
I want to launch an data management & business analytics
software tool which we will customize to the client's individual
needs to manage large data and analyzing business process.
Although we recognize the intimate relationship between
profitability and quality products, we know that our success is
ultimately dependent on the well-being of our employees and
clients. We will begin development of additional software
packages to fill other needs based on our market research in the
coming year.
1.3 Keys to Success

The success of our company is dependent on our ability to:

 Anticipate clients needs.

 Adapt software solutions to these needs.
 Identify industries/corporations that need planning tools.

2.Company Summary

DMAS provides data management & business analytics software

solutions. We identify companies' planning needs and work with a
third-party manufacturer to create software to address these
needs. Although the actual software is produced out-of-house, we
guarantee the customer the right solution.
2.1 Start-up Summary

Start-up expenses, which cover phone calls, office furniture,

letterhead and business cards come to 200000. We also need
4500000 of cash on hand. These costs will either be financed by
owner investment or through financing from the software
manufacturing partner. Details and assumptions are summarized
in the following chart and table.

Start-up

Requirements

Start-up Expenses

Legal 10000

Stationery etc. 20000

Brochures 0
Consultants 0

Insurance 40000

Rent 0

Research and development 0

Expensed equipment 130000

Other 0

Total Start-up Expenses 200000

Start-up Assets

Cash Required 45,00000

Other Current Assets 0

Long-term Assets 0

Total Assets 4500000

Total Requirements 47,00000

Start-up Funding

Start-up Expenses to Fund 200000

Start-up Assets to Fund 4500000

Total Funding Required 4700000

Assets
Non-cash Assets from Start-up 0

Cash Requirements from Start-up 4500000

Additional Cash Raised 0

Cash Balance on Starting Date 4500000

Total Assets 4500000

Liabilities and Capital

Liabilities

Current Borrowing 0

Long-term Liabilities 0

Accounts Payable (Outstanding Bills) 5000

Other Current Liabilities (interest-free) 35000

Total Liabilities 40000

Capital

Planned Investment

Investor 1 2520000

Investor 2 2140000

Other 0

Additional Investment Requirement 0

Total Planned Investment 4660000

Loss at Start-up (Start-up Expenses) 200000

Total Capital 4460000

Total Capital and Liabilities 4500000

Total Funding 4700000

2.2 Company Locations and Facilities

The company will be located in a home-based office in KOLKATA,
INDIA. This location is ideal, as it is close to the software
manufacturer's facilities and several of the first potential clients'
home offices.

3.Products and Services

DMAS will provide medium- and large-sized companies with

enterprise-wide collaborative planning solutions.

We will also provide consulting services by helping companies

recognize opportunities for using technology to streamline their
business processes. Finally, we will provide complete training for
the use of solutions purchased from us.
3.1 Product and Service Description
Software

DMAS software products offering—

 Analytics
 Business Analytics
 Business Intelligence
 Customer Intelligence
 Data Integration & ETL
 Fraud Prevention & Detection
 IT Management
 Web Enablement
 Data Migration/Warehousing
 Ad Hoc Reporting
 Meta data management
 On Demand Solutions
 Performance Management
 Risk Management
 Supply Chain Intelligence
 Sustainability Management
 Data Access and Integration

 Application Development

this product is the top-rated and best-selling small business

planning package. The enterprise version will be similar to the
consumer version however, it will be modified to fit the needs of
different clients. The product will allow corporate sales forces and
franchises to use planning tools and database management
system to achieve tremendous efficiencies in their business
processes. In essence, a sales force will be able to write concise
business plans for any customer and through the use of an
extranet, allow the customer to collaboratively plan their own
account. Franchises will be able to create a road map of their
business plans that corporate managers can monitor and adjust
accordingly. The possibility exists to customize the product to
work with other collaborative tools such as LotusNotes and the
clients email applications.

Consulting
DMAS will perform an analysis of all potential clients' planning
strategies and tactics as well as their degree of aptitude with
database management + planning software and information
technology. The goal of this analysis is to ensure that all clients
get a solution that best fits their needs and capabilities. Whether
they decide to purchase the product or not they will have an
expert analysis of their planning strategies.

Training
DMAS will provide further value to our customers, and ease the
customer service burden on our partner, by ensuring that all
product users are properly trained in the use of all software
solutions.

Interface
Through the software manufacturer, DMAS will provide an
additional product which will give the client a dedicated service
representative--eliminating the need for product updates. This
will in essence create a "living" product which can grow and adapt
with the clients' needs. The interface representative will function
through the clients' established extranet.

3.2 Competitive Comparison

Alternative products do not offer a complete package of tools. For

example, to get similar results from another product(s) the client
would have to integrate complex spreadsheets, word processing
software, database management, instructions and Web based
collaboration themselves.

3.3 Technology

The software package runs on Windows 95, 98, 2000,Windows 7,

Windows NT, Macintosh, and Linux platforms.
4. Market Analysis Summary

We will operate in the business-to-business segment of e-

commerce. Our market is further segmented into companies with
sales forces greater than 50 people and companies
with branches, divisions or franchises in excess of 50 units.

4.1 Market Segmentation

We segment our market by size of sales force and number of

company subunits. Our target customers will have sales
operations in excess of 50 direct sales representatives or more
than 50 organizational subdivisions or franchises. For the first
three years of operation we will focus on Indian companies in the
east, north region. Geographically this make sense as our office is
close to these regions and management has established key
client contacts in each of these areas. Larger clients are more
likely to benefit from the efficiencies our product offers and will
provide fees that will sustain our profitability. Exact figures for
the number of businesses are hard to determine, however, the
lean structure of our company will allow us to be profitable by
generating two to three new clients per year.
Projected Market Analysis

Year 1 Year 2 Year 3 Year 4 Year 5

Potential
Growth CAGR
Customers

Sales
3% 500 515 530 546 562 2.97%
Companies

Franchises 2% 800 812 824 836 849 1.50%

Other 5% 200 210 221 232 244 5.10%

Total 2.49% 1,500 1,537 1,575 1,614 1,655 2.49%

4.2 Target Market Segment Strategy

Our strategy is designed to target:

 Medium- to large-size organizations whose sales forces

provide their clients with proposals and plans that the client
either collaborates on, or would benefit from collaboration.
 Companies that sell franchise rights and take an active role
in the success of their franchises.
 Larger clients that will provide greater revenues through a
larger volume of software licensing sales and greater chance
of selling client interface solution.
4.2.1 Market Trends

The most significant trend affecting our company is the growth of

business-to-business e-commerce. More and more firms
recognize the need to take advantage of the exchange of
information over the Internet and our products and services rely
on this.

4.2.2 Market Growth

The fastest growing segment of the e-commerce industry is the

business-to-business sector.

4.2.3 Market Needs

Customization-products that strengthen their brand and address

their differences:

 We will "Private Label" the solution so as to further

strengthen the clients' brand.
 We recognize that different clients will have varying levels of
sophistication and we will design different product templates
for each customer.

Speed, efficiency and information:

 Our product will allow the client to make better and faster
business decisions and receive quicker feedback from their
end-customer.
 Managers will have the ability to monitor the progress and
profitability of their staff.
4.3 Service Business Analysis

Customers tend to buy enterprise software solutions based on

reputation, price and reliability. Also, compatibility with existing
or legacy systems is very important. With this in mind, the key
decision makers and influencer(s) will be the companies' chief
financial officer and chief information officer.

4.3.1 Business Participants

There are currently several companies that provide business

planning software for desktop applications, but as yet none of
these offer enterprise-wide solutions. Additional competitors are
companies which provide word processing, spreadsheet and
collaborative planning software, as well as publishers of business
planning literature.
5.Strategy and Implementation Summary

Various strategy/and implementation topics are discussed in the

following sections.

5.1 Competitive Edge

Our greatest strength and competitive edge will be our honesty

and service. This product will be the market leader in sales and
consumer ratings. Our success will rely upon building on those
strengths. We will also rely on our experience working with
decision makers at the corporate level.

5.2 Marketing Strategy

We will position DMAS as the best planning consultant for large

corporations interested in the software we sell. we need to focus
on our understanding of the needs of large corporations and
franchises, and how we can translate that into finding the correct
software solution.

Positioning
DMAS will initially be positioned as the premier product for
project managers in the IT industries. Our strategy is to build a
strong loyalty within this key market before moving on to the
phase two and three markets. The product will be promoted as
the most technologically advanced on the market of India.
Pricing Strategy

This is an expensive solution to develop and maintain, and the

price will reflect the premium quality of the offering. Set-up costs
to the client will run between 10000-15000. The dedicated
service option is approximately 5000/year. Software licenses are
1000/year.
Sales Strategy

We will first target the corporate offices of franchises with more

than 50 units, and companies with sales forces in excess of 50
personnel. The software manufacturer has already provided the
names and contact information for several firms which fit this
profile. These firms have approached the software manufacturer
about enterprise solutions in the past. The software firm has also
provided a list of larger businesses that purchased an executive
version of their product. We will contact these firms with the idea
of helping them take this planning tool to the next level.

Management of DMAS has business contacts at the decision

maker level for several more prospects as well. These will be our
secondary targets.

Tertiary targets will come from lists of firms fitting the above
criteria which management has generated through Web-based
market research efforts. Tactics for approaching these prospects
will be indirect, i.e., we will contact sales managers and/or
franchisees to establish whether the firm fits our profile and then
probe for upper or middle level management contact information.
We will attempt to establish a face-to-face meeting with decision
makers .where we will present a proposal tailored to their needs.
If possible, we will also have this proposal reside on an extranet
so that the client can modify the proposal and see first-hand how
the product and service work.

Sales Forecast

Our sales consist of two services--consulting and training, and

one product-the software/extranet package (called start-up
sales). Our services provide a fraction of the revenue we will
receive for the software/extranet solution, but they will sustain
our cash flow needs while we develop the enterprise sales. Sales
of consulting, training and product are predicted to grow at 45%,
18% and 24% respectively. Costs associated with these sales are
estimated at 16% for start-up sales, 38% for consulting fees and
58% for training. We expect these costs to decrease two, five,
and ten percentage points respectively in years two and three.

Promotional strategy
We will begin promoting DMAS to the IT market through several
avenues. These include:
· Special IT and Project Management Conference sponsorships
and demonstrations
· Direct mail campaigns
· Print advertising campaigns
· Email and web promotional campaigns
Supplemental to these efforts will be development of the
company web site, development of supporting print and electronic
literature and multi-media presentations.

6.Management Summary

I am SHUBHADIP BISWAS, 26, the founder of the company in

Nov of 2010 to take advantage of this fast growing industry. I am
pursuing an MBA from IILM-GSM ,INDIA, and have completed
M.SC in COMPUTER SCIENCE from SMU,INDIA after completing
B.SC in Physics Hons. From Calcutta university. I currently reside
in Greater Noida.Up,India.
7.Financial Plan
The most crucial issue affecting our financial plan is the receipt of
start-up fees for the customization and installation of the
software and extranet solution. This drives our cash flow, COST
SHEET and all other aspects of our operation.
MEANING OF COST

‘Cost’ can be defined as ‘the price paid for something’. But in the
management terminology, ‘cost’ refers to expenditure and not to
price. ‘Cost’ represents a sacrifice, a foregoing or a release of
something of value. The INSTITUTE OF COST AND MANAGEMENT
ACCOUNTANTS, LONDON, has defined cost as ‘the amount of
expenditure (actual or notional) incurred on or attributable to a
given thing’. For purchasing an sofware, the expenditure incurred
on the purchase of raw-materials, wages paid to the workers ,
electricity and lighting expenses, depreciation on machinery used
, capital cost of owned factory building etc, are a few components
of cost.

ELEMENTS OF COSTS

One of the main objects of cost accounting is to present the

analysis of the total cost of production in such a manner as to
provide the maximum information useful to the business. The
analysis and classification of costs is basically made with
reference to factors on which expenditure is incurred. These
factors are known as ‘elements of cost’. The various elements of
cost are:-

1) Material cost
2) Labour cost
3) Expenses

MATERIAL COST

‘Material Cost’ refers to the cost of commodities supplied to an

undertaking e.g., cost of software which is supplied to IT
industries that use them to build the end products is categorized
as material cost by the sofwaree company..

Material cost may be further subdivided into

a) DIRECT MATERIAL COST:- Direct material cost means the

cost of materials which can be identified with and allocated
to the cost centres or cost units. The main feature of direct
material is that these enter into and form part of the
finished product. e.g. cost of wood in case of furniture, cost
of cotton in case of cotton yarn, cost of iron in case of
machinery etc.

b) INDIRECT MATERIAL COST:- It refers to the material cost

which cannot be allocated but can be apportioned to or
absorbed by cost centres or cost units. These are the
materials which cannot be traced as part of the product and
their cost is distributed among the various cost centres or
cost units on some equitable basis.
LABOUR COST

Labour cost refers to the cost of remuneration of the employees

of the undertaking e.g., wages, salaries, commission etc. Labour
cost may be sub-divided into:-

a) DIRECT LABOUR COST (or DIRECT WAGES):- It refers to

labor cost which can be identified with and allocated to cost
centres or cost units. It includes the remuneration paid for
converting the raw materials into finished products or for
altering the construction composition of the product
manufactured by an undertaking e.g., wages paid to factory
workers involved in the production of company products.

b) INDIRECT LABOUR COST (or INDIRECT WAGES):- It refers

to the labor cost or wages which cannot be allocated but can
be apportioned to or absorbed by cost centres or cost units
eg: Salary paid to factory manager, engineer etc.

EXPENSES

Expenses refers to the cost of services provided to an

undertaking and the notional cost of the owned assets (that is
depreciation of owned factory building, office building, showroom
building, plant and machinery etc). Expenses are sub-divided
into:-

a) Direct expenses (or Chargeable expenses):- These are the

expenses (other than direct material cost and direct labour
cost) which can be identified with and allocated to cost
centres or cost units. eg., carriage and freight of direct
materials purchased if such carriage and freight have not
been added to the cost of materials, royalties paid on the
basis of output, hire charges of special plant and machinery.
 b) Indirect Expenses:- Expenses which cannot be allocated but
can be apportioned to or absorbed by cost centres or cost
units e.g., rent, taxes and insurance of factory building ,
factory lighting, repairs to factory building, depreciation of
plant and machinery, repairs to machinery etc., are known
as indirect expenses.

The aggregate of direct cost material, direct labour cost and

direct expenses is known as ‘Direct Cost’ whereas the aggregate
of indirect material cost, indirect labour cost and indirect
expenses is known as ‘Indirect Cost’ or ‘Overhead’.

Indirect cost or overhead may again be classified on the basis of

functions as follows:

FACTORY OVERHEAD OR WORKS OVERHEAD:- Factory overhead

includes all the indirect costs incurred in the factory in connection
with manufacturing operations. Factory overhead comprises the
cost of indirect labour and all other indirect expenses which are
incurred in the running of the factory or works.

OFFICE AND ADMINISTRATION OVERHEAD:- These includes all

indirect costs relating to the direction, control and administration
of an undertaking. In other words, office and administration
overhead refers to general office expenses and expenses of
administration and control of business e.g., office insurance,
depreciation of owned office building, office lighting, depreciation
of office furniture and stationary, audit fee, director’s
remuneration, salary of general manager, bank charges etc.

SELLING AND DISTRIBUTION OVERHEAD:- These include all

indirect costs which are incurred for promoting sales and
retaining the customers and for delivering the goods after their
production. e.g., cost of advertisement, toll taxes and commission
to dealers, salary of sales manager, salaries and commission of
salesman, carriage on sales, packaging charges, running and
maintenance.

CLASSIFICATION OF COSTS FOR THE COMPANY

The cost of the company is mainly classified into three parts:-

1) FIXED COST:- It refers to those costs which tend to remain

unaffected by changes in the volume of output or sales. In
other words, fixed cost remain unchanged with the increase
and decrease in the output or sales. These cost remain fixed
in total but their per unit cost changes with changes in
output or sales. Rent, taxes, insurance charges, manager’s
salary, etc., are typical examples of the fixed cost of the
company.
It should be remembered that fixed cost are not absolutely
fixed for all time. These are fixed only in relation to a certain
level of production capacity.

2) VARIABLE COST:- It refers to those costs which vary directly

in proportion to changes in the volume of output or sales.
These costs tend to increase or decrease with the rise or fall
in the production or sales. Variable costs vary in total but
their per unit remains constant. Direct material cost, direct
wages, direct expenses etc., are typical examples of variable
costs.
3) SEMI VARIABLE COST:- It refers to those costs which ten d
to vary with changes in the volume of output or sales, but
not directly in proportion to such changes. These costs have
the characteristics of both fixed and variable costs. A apart
 of semi-variable costs remains constant inspite of changes in
the volume of output or sales. Repairs and maintenance
costs of plant, machinery and building, salary of supervisor,
etc., are typical examples of semi-variable costs.
Now the company will classify their cost into
these different categories and prepare a cost sheet to decide
the price at which we will launch their software product in
the market.

COMPONENTS OF COST

A ‘component of cost’ may be defined as the cumulative or

aggregate of different elements of cost. By aggregating or
grouping the various elements of cost, the following components
or types of cost can be obtained:-

1) PRIME COST:- Prime cost is the aggregate of direct material

cost, direct labourcost or direct expenses. Prime cost is also
known as ‘Flat Cost’, ‘First Cost’ or ‘Direct Cost’
2) FACTORY COST:- Prime cost plus factory overhead (or works
overhead) is known as factory cost. Thus , factory cost is the
aggregate of direct material cost, direct labour cost, direct
expenses and factory overhead. Also known as ‘works cost’,
‘production cost’, or ‘manufacturing cost’.
3) OFFICE COST:- Factory cost plus office and administrative
overhead is known as ‘Office cost’. Also known as ‘Gross
cost’ or ‘Cost of production’.
4) TOTAL COST:- Total cost is made up of cost of production
plus selling and distribution overhead. Thus, total cost
includes all the elements of cost or all the items of
expenditure till the commodity has been , finally sold. Also
known as ‘selling cost’ or ‘cost of sales’.

EXPLANATION
 a) Direct material cost + direct wages +direct expenses =
prime cost
b) Prime cost + factory overhead = factory cost
c) Factory cost +office and administration overhead = office
cost
d) Office cost +selling and distribution overhead = total cost
e) Total cost +profit = selling price

COST SHEET ASSUMPTIONS OF THE COMPANY

TOTAL TARGET OUTPUT=180 UNIT PER YEAR

Particulars Cost per Total output

unit
Raw materials[computer Software 1666.66 300000
etc….]
Direct wages 138.88 25000
Direct expenses 138.88 25000
PRIME COST 1944.44 350000

Indirect wages 138.89 25000

Salary of software engineer 1111.11 200000
Electricity 111.11 20000
Insurance 222.22 40000
Maintenance 222.22 40000
Manager[factory] fee 194.44 35000
Telephone 27.78 5000
Computer 277.78 50000
Furniture 111.11 20000
Others 166.67 30000
FACTORY COST 4527.78 815000

Director[executive,financial,operation, 1388.89 250000

Consulting,training,communication]
fee
Trainer 277.78 50000
Stationary 111.11 20000
Depreciation 111.11 20000
Bank charges 138.89 25000
Other office expenses[printing and 222.22 40000
stationary etc….]
COST OF PRODUCTION 5388.89 970000

Sales team salary[50*10000] 2777.78 500000

Distribution 1111.11 200000
Commission 277.78 50000
Transportation 277.78 50000
Advertisement 1111.11 200000
Service to the clients 3777.78 680000
Bad debts 277.78 50000
TOTAL COST 15000 2700000

NET PROFIT[27.03% OF THE 5555.55 1000000

SELLING PRICE]
SALE 20555.55 3700000
 ANALYSIS

The idea of starting DMAS software company in KOLKATA seems

to be a profitable business venture. The direct labor charge and
cost of procuring raw material in India is very low.

Our company emphasized on selling and distribution service more

than production. Because our company is in launching phase and
to capture market providing service to the clients is the most
important thing.

We would also try to maintain good reputation in our product

sector by creating and developing new features as per demand in
the market.

The present production capacity is 180 units per year. This can be
increased in future as per demand in the market.
We have proposed to sell our product at a price of RS 20555.55.
thus profit earned from finished product will be RS 5555.55 per
unit. As the company is newly established it will take time to
develop such a demand, that in future it can earn more overall
profit.

Significant effort will be placed on research for future product

development to continue to build on the DMAS product line.
Research will be done both internally through our marketing
department and through professional researching firms to
determine customer needs outside of our current product
offering.

Research into new product demands will begin in July of 2011.

The new product development cycle will be scheduled to begin in
December of 2012 based on findings from the July research.
We are hoping to grip total Indian market within the next few
years.
Thus this proposal seems to be a profitable venture.