Company Name:

BUTTERS

LOGO:

SLOGEN:
Life Betters with Butters

Company’s Mission:

To combine aggressive strategic marketing with quality products

and services at competitive prices to provide the best insurance
value for consumers.

Company’s Vision:

Helping people around the world eat and live better.

Entrepreneurship Page 1 of 21 BUTTERS

Company Profile:

Form of Business: Partnership

Principals: M. Rahim Ejaz

Fahina Rasool
Imran Khan

Name of Business : BUTTERS

Start Date: 25 Dec, 2010

Business Operation: Full time venture

Monday to Friday
9:00 am to 5:00 pm

Business Description: Provider of a

Substitute to Desi Ghee

Location: Model Town, Block Z

D. G. Khan, Pakistan
Cell: 03336474380
Email: www.butters.org

Business Advisors: Mr. Faran Ibrahim

Chartered Accountant
Mr. Omer Farooq
Marketing Specialist

Entrepreneurship Page 2 of 21 BUTTERS

Confidentiality Agreement:

The undersigned reader acknowledges that the information

provided by the principals in this business plan is confidential;
therefore, reader agrees not to disclose the information.

It is acknowledged by reader that information to be furnished in this

business plan is in all respects confidential in nature, other than
information which is in the public domain through other means and
that any disclosure or use of same by reader may cause serious
harm or damage to the business.

Upon request, this document is to be immediately returned to the

legal advisor.

Names of Principals

M. Rahim Ejaz ______________

Fahina Rasool ______________

Imran khan ______________

Date: 25 Dec, 2010

Entrepreneurship Page 3 of 21 BUTTERS

Executive Summary:

When we talk about the future trends and outlook of the business
then we come to know that still it is untouched section in cooking oil
industry of Pakistan. We are the entrepreneurs and future of this
business is very bright. This industry is covering all the geographic
area and it is of great importance in the GDP.

Our core aim is to provide FMCG products to increase the value of

the customers. We will not distributors in our business because
more intermediaries increase cost and distance to the customer. We
will establish retail outlets to target our customers and make
availability of the products. One head office will be established in
the hometown to deal with the customers and suppliers of the
business.

It is a partner form of a business. It has three partners. They all

have equal responsibilities to run operate and investigate the entire
business operations.
We have no share holders. We will meet our financial requirements
from the bank loans. Principals have full authority in the business
and they have full right to investigate, audit and operate the
business in any nature. Management background is very important
in the organizational structure. High profile and high expertise
management personnel are hired to perform the duties and roles in
the business.

Our product is very unique in the market infect this type of product
has been never introduce in the market before. Our product is a

Entrepreneurship Page 4 of 21 BUTTERS

cooking substance and it is first time that it is in the shape of a
cake. It is easily turned into edible oil

while cooking process. It is unique in nature one cake piece is

enough to fulfill the needs of a family of a one supper.
We are targeting people from all the segments of the market. We
have no differentiated segment to target. We are targeting the
whole market. Our special focus is on the low income people. The
purchase cycle of our product will be low because one pack will
satisfies more then the expectations to the buyers.

Our product is unique and has no competitor in the market.

However large brands are threats to our company but we have an
edge of uniqueness of our product. Further more our competitor is
in the market for more then 50 years and we are entrepreneurs. We
are introducing low price as compare to our competitor. Our product
nature is totally different from the product nature of our competitor.

The operations of the business will be started from the purchase or

raw material from the suppliers. Our raw material is milk. After
purchasing the raw material from the supplies it is sent to the
production department. When the production process completes
then the product is sent to the packaging section. When the
packaging of the product is completed then inventory is handed
over to the marketing and sales department. They make the
availability of the product to the final customer.

The total finance that is required to start this venture is about 60

million. All the cost of business, assets and operating costs are
included in it. As well as projected income statements and projected

Entrepreneurship Page 5 of 21 BUTTERS

balance sheet is given in the section of financial plan of this
business plan. 60% resources are managed by the entrepreneurs
and remaining 40% financial requirements are fulfilled the bank
loans.

Industry Overview:

When we talk about the future trends and outlook of the business
then we come to know that still it is untouched section in cooking oil
industry of Pakistan. We are the entrepreneurs and future of this
business is very bright. This industry is covering all the geographic
area and it is of great importance in the GDP.

Our product is environment friendly is does not harm the cultural

variable anymore. Our product is very flexible in terms of
technology development. When technology changes it would be
easy for us to upgrade our plant and machinery according to the
needs and wants of the market.

Our product is new and unique, so it is very important for us to

patent our brand and product from the patent office in order to save
our product from criminal use and for legal protection.

As we discussed earlier that high potential and high demand exists

in the market but they have no enough buying power to purchase
the product. There is no potential threat to our company because or
product is unique and no competitor lies in the market.

Entrepreneurship Page 6 of 21 BUTTERS

Our product is FMCG natured and we have no segmented market,
we are targeting the whole market. There is a bright future of the
edible oil industry of Pakistan and market is flourishing day by day.

The main barrier in this industry is the non availability of resources

for making the edible oil. Pakistan is importing 65% of raw edible oil
in order to make it refined to place it for final consumption for the
target market.

Business Description:

This is a nationwide business. Our core aim is to provide FMCG

products to increase the value of the customers. We will not
distributors in our business because more intermediaries increase
cost and distance to the customer. We will establish retail outlets to
target our customers and make availability of the products. One
head office will be established in the hometown to deal with the
customers and suppliers of the business. Computers, internet,
facsimiles, printers, office jets are used in the office equipments and
approximately 50 employees will work in he head office to handle
the entire venture.

Product Description:

Our product is very unique in the market infect this type of product
has been never introduce in the market before. Our product is a

Entrepreneurship Page 7 of 21 BUTTERS

cooking substance and it is first time that it is in the shape of a
cake. It is easily turned into edible oil while cooking process. It is
unique in nature one cake piece is enough to fulfill the needs of a
family of a one supper.

We are introducing different sizes in our product in order to enhance

the customer value and satisfaction. The different sizes are to fulfill
the demands of consumer having different income levels.

It will give benefit to the price conscious market. They will easily
purchase their desired product and fulfill their needs and wants. It is
easy to use and risk of loss and wastage is very much reduced.

Our product contained no competitor yet in the market, so it will be

easy for us to position our product in the minds of the customer. We
are trying to make available healthy cooking substance to the low
income people as high income people buy good quality cooking oils
at high price.

Target Market:

We are targeting people from all the segments of the market. We

have no differentiated segment to target. We are targeting the
whole market. Our special focus is on the low income people. The
purchase cycle of our product will be low because one pack will
satisfies more then the expectations to the buyers.

Our product will not affect the life style of the people. Mostly the
house wives will influence to purchase the product because product

Entrepreneurship Page 8 of 21 BUTTERS

usage is economical, low purchasing cycle and competitive price will
influence and attract the people to buy and use the product.

Competitive Analysis:

Our product is unique and has no competitor in the market.

However large brands are threats to our company but we have an
edge of uniqueness of our product. Further more our competitor is
in the market for more then 50 years

and we are entrepreneurs. We are introducing low price as compare

to our competitor. Our product nature is totally different from the
product nature of our competitor.

The strength of our competitor is its large brand name but we will
compete to its brand. They are using high advertising campaigns as
compared to us.

Production Plan:

Basically BUTTERS is a dairy product which is created by removing

the moisture and the nonfat milk solids contained in butter. It is a
milk fat-based dairy product in its purest form. In terms of a
packaged good, BUTTERS is an efficient and economical means of
edible usage.

Butterfat in milk is comprised of various types of fat lipids, each

fraction having its own particular melting point. The main fraction
consists of triglycerides of fatty acids. The melting point for milk fat
is 37.C; butter oil begins to solidify at temperatures of less than

Entrepreneurship Page 9 of 21 BUTTERS

17.C. Butter oil is commonly stored in 200 kg drums and may be
stored at low temperatures.

Composition

Anhydrous milk fat products are manufactured in two common and

distinct varieties.

There two common techniques are:

1. Anhydrous Milk Fat:

• Must contain at least 99.8 percent milk fat and be made from
fresh cream or butter;
• No additives (for neutralization of free fatty acids) are
permitted.

2. Anhydrous Butter oil:

• Must contain at least 99.8 percent milk fat but can be made
from cream or butter of different ages and must be kept below
17 C to solidify it.
• Use of alkali (an additive) to neutralize free fatty acids is
permitted.

Typical composition of BUTTERS

Fat 99.6%
Moisture 0.3%
Protein 0.1%

Entrepreneurship Page 10 of 21 BUTTERS

Note: Anhydrous milk fat or anhydrous butter oil must contain less
than 0.2 percent moisture.

Various Uses

BUTTERS possesses a light yellow color and has a clean bland

taste, free from sour, bitter, rancid, oxidized or other objectionable
flavors. Intense heat treatment is not used in the manufacturing
process. Consequently, butter oil lacks heated butter flavors. In the
dairy products industry, it is used for recombination with skimmed
milk powder to produce liquid milk and other milk products. Lecithin
in butter oil is used to produce instant milk powder. In

baking, butter oil can be sprayed on cracker surfaces to enhance

gloss and appearance. It is also used in the chocolate manufacturing
industry.

The advantages of using BUTTERS are:

• Increased puff for pastries and pie shells;

• Aroma and flavors enhancement in bakery items;
• Control of fat bloom in chocolate candy; and
• Ease of melting, pumping and mixing with other food
ingredients.

Functional Properties

Milk fat has many functional properties which makes BUTTERS a

most valuable food ingredient. The most notable are the following:

Entrepreneurship Page 11 of 21 BUTTERS

 • Air incorporation
• ant staling (through moisture dispersion and retention)
• creaming
• flavors
• flavor carrier
• gloss
• layering
• shortening

Milk fat is composed of triglycerides ranging from volatile low-

melting to high-melting fractions. Fractionation of butter oil through
various separation processes is based on different methods of
crystallization of triglycerides at different temperatures. These
fractions have specific functional properties and can be used in
various food products. For example, the high melting fractions may
be used as cocoa butter substitutes or as shortening for specialty
baked

goods such as Danish pastry. Also, the low-melting fractions with a

concentration of flavors, vitamins and pigments could be used for
production of a soft butter, spread able at refrigerator temperatures.

Operational Plan:

The operations of the business will be started from the purchase or

raw material from the suppliers. Our raw material is milk. After
purchasing the raw material from the supplies it is sent to the
production department. When the production process completes
then the product is sent to the packaging section. When the
packaging of the product is completed then inventory is handed

Entrepreneurship Page 12 of 21 BUTTERS

over to the marketing and sales department. They make the
availability of the product to the final customer.

Supplier Purchases

Customer
Satisfactio
Operational Cycle Production
n

Packaging
Placement

The suppliers of our company are basically dairy milk farmers. We

have decided to have a contract with them. They will provide us
milk on the daily basis according to needs and requirements. Our
milk collectors will collect

milk from these farmers on time and reach to the production plant
in time in order to run the production and operations.

Organizational Plan:

It is a partner form of a business. It has three partners. They all

have equal responsibilities to run operate and investigate the entire
business operations.

Entrepreneurship Page 13 of 21 BUTTERS

We have no share holders. We will meet our financial requirements
from the bank loans. Principals have full authority in the business
and they have full right to investigate, audit and operate the
business in any nature. Management background is very important
in the organizational structure. High profile and high expertise
management personnel are hired to perform the duties and roles in
the business.

We will provide full safety and security to the employees of the

organization. All the facilities will be provided to the employees of
the organization. Health insurances are given to the employees.
Benefits, incentives and target achievement allowances will be
given to the employees of the company.

The environment of the organization will be kept clean and calm in

order to increase the high work efficiency. Especially at plant best
working environment will be provided to workers to increase their
productivity.

Organizational Structure:

Entrepreneurship Page 14 of 21 BUTTERS

 Chief
Executive
Officer

General Business
Manager Advisors

Chief Chief Chief Chief

Operating Marketing Production Finance
Officer Officer Officer Officer

Manager
Accountant
Sales & Principal
Assistants Purchasers s
Distributio Engineer
n

Sales Sub
Officers Engineers

Distributio Quality
n Officer Controller

Marketing Plan:

Entrepreneurship Page 15 of 21 BUTTERS

Promotion
Our promotional campaign includes advertisements in news papers,
magazines and televisions. Yellow pages, personal selling and bill
boards’ techniques are also used to create awareness among the
customers; different type of incentives, bonuses will be given to
both customers and distributors in order to enhance the sales of the
product. Sponsorship of different events will be done in order to
promote our brand.

Place
Place plays an important role in the business. Due to the FMCG
nature of our product we use intensive nature of placement of our
product. We will target each and every outlet of the market. We find
dense populated sales points in order to attract more and more
customers. Because dense populated areas are more potential
market for us, it will be more beneficial for us. Commercial and
residential areas will be targeted for the placement of the product.

Price
After assuming the cost occurring on labor, factory overhead and
materials, a reasonable price is determined of a product having a
profit margin low in order to increase the sales. Low price strategy
will be practiced in order to attract the low income customers. This
low price strategy helps to increase the market share of the product.

SWOT Analysis

Entrepreneurship Page 16 of 21 BUTTERS

Strength:

• Business will have longer hours and better prices as compared

to competitors.
• Discounts are available for bundle buying.
• Expertise in getting new products to the market quickly.
• Expertise in providing good customer service.
• Online selling could be a competitive edge over similar rivals.
• Customization available for individual customers.

Weakness:

• New in business as compare to rivals.

• Huge capital required to start business as credit is not easily
available from supplier in start.
• Marketing expense in the start will be huge, to establish brand
name required lot of advertising.

Opportunity:

• It is a business that can be operated throughout the year.

• Sector is growing fast in the country.

Threat:

• Competition is high and big companies like Dalda and Habib

will easily penetrate in this new market opportunity.

• People are more conscious for pricing due to inflation and

going for discounts

Entrepreneurship Page 17 of 21 BUTTERS

Financial Plan:

Statement of Finance Needed:

(Amount in Million)
Plant and Machinery Rs. 20
Land Rs. 10
Building Rs. 06
Office Equipment Rs. 04
Hiring cost (management & labor) Rs. 05
Start-up Inventory Rs. 05
Sales & Marketing Rs. 07
Research & Development Rs. 03
Total Start-up Finance Needed Rs. 60

Projected Balance Sheet:

Entrepreneurship Page 18 of 21 BUTTERS

Assets

• Cash Rs. 10,000,000

• Accounts Receivable Rs. 500,000
• Inventory Rs. 100,000
• Equipment Rs. 20,000,000
• Land & Building Rs. 16,000,000
• Furniture Rs. 180,000

Total Assets Rs. 46,780,000

Liabilities

• Suppliers Payable Rs. 100,000

• Accounts Payable Rs. 1,500,000
• Notes Payable Rs. 12,500,000

Total Liabilities Rs. 14,100,000

Owner’s Equity

• Draws (Rs. 1,820,000)

• Paid in Capital Rs. 26,000,000
• Retained Earnings Rs. 8,500,000

Total Owner’s Equity Rs. 110,818,000

Total Liabilities and Owner’s Equity Rs. 46,780,000

Projected Income Statement:

Revenues

Entrepreneurship Page 19 of 21 BUTTERS

Net Sales Rs. 50,000,000

Total Revenues Rs.

50,000,000

Expenses

Wages Expense Rs. 1,550,000

Cost of Goods Sold Rs.

5,000,000

Utilities Expense Rs. 2,500,000

Supplies expense Rs. 250,000

Total Operating Expenses Rs. 9,300,000

Profit/Loss before Tax Rs.

40,700,000
Profit/Loss after Tax Rs.

32,763,500

Entrepreneurship Page 20 of 21 BUTTERS

Entrepreneurship Page 21 of 21 BUTTERS