TECHNO SMART

Tomorrows solution today!

Solution provider for electronics equipment through highly

advanced micro electronics technology.
Submitted To: Mr. Faizan Khalid
Submitted by:
Ali Ahmed Khan
M. Ali Khan
M. Shan Malik
Mahin Mujahid

TECHNO SMART

Table of Contents
I.

Executive Summary .............................................................................. 1

II.

Business Description ............................................................................ 2

Form of Business
Owners
Name of Business
Description
Mission Statement
Unique Selling Point (USP)
Primary Objectives
Location
Gap Identification

III.

Porters Model ...................................................................................... 6

Barrier to Entry
Supplier Power
Buyer Power
Threat of Rivalry
Threat of Substitute

IV.

Pest Analysis ........................................................................................ 7

Political
Economic
Social
Technological

V.

SWOT Analysis ..................................................................................... 9

Strengths
Weakness
Opportunities
Threats

VI.

Market Size and Trends ...................................................................... 10

VII.

Market Growth .................................................................................. 10

VIII.

Government Policies .......................................................................... 10

IX.

Population Shifts ................................................................................ 10

X.

Growth Potential ............................................................................... 10

XI.

Barriers to Growth ............................................................................. 10

TECHNO SMART
XII.

Competitor Analysis ........................................................................... 10

XIII.

Market Segmentation ........................................................................ 11

Demographic Factors
Geographic Segmentation
Target Market

XIV.

Value Proposition............................................................................... 12

XV.

Pricing Strategy .................................................................................. 12

XVI.

Sales & Distribution Strategy .............................................................. 12

XVII. Advertisement & Promotions Strategy ............................................... 12

XVIII. Organizational Structure .................................................................... 13
Role and Duties
Staffing Plan Salary Structure
XIX.

Critical Risks ....................................................................................... 15

Potential Problems

XX.

Obstacles & Risks ............................................................................... 16

Obstacles
Risks

XXI.

Contingency Plan ............................................................................... 17

XXII. Exit Strategy ....................................................................................... 17

XXIII. Operations ......................................................................................... 18
Capacity Management
Supply Chain Management
XXIV. CONCLUSION ..................................................................................... 20

Executive Summary
Techno Smart is a solution provider for electronics equipment through highly advanced
micro electronics technology. Moreover, the services are being enhanced by offering security
lock system as well as automatic switching of fans and lights by using personal mobiles of the
customers. Techno Smart would be owned by 4 persons who would make it possible to provide
quality products as well as deemed services required by the customers. Initially in the first
phase, Techno Smart will target households only in Lahore market.
Thereafter, the expansion will be done to other main adjacent cities. Due to the
prevailing insecure atmosphere in Lahore, Techno Smart lock system idea would be warmly
welcomed and adopted. Results of the survey show that people are ready to spend money in
exchange of security of their families. As far as automatic turn ON and OFF is concerned, the
luxurious and busy routine of people would support it too. This innovative idea is going to
fascinate the target market.
The primary objectives for next 5 years would be:

To gain customers trust and satisfaction.

Position our brand effectively and obtain a reputable image.
Expansion of Techno Smart to other metropolitans, first in Punjab and then in Sindh too.
To make this Techno Smart system the necessity of the consumers.
Generate reasonable profits.

Techno Smart lock device would be the set-up of an electronic lock powered by the existing
gate controller 12-24 Ac or DC supply. Customers would not need to carry their keys along with
them, moreover no need of waiting on the road or getting out of the car in rain. As only saved
numbers can SMS so it would make the customer relaxed and relieved. The GSM switching
would help to save the energy too and would also serve as a convenience product.

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Business Description
Form of Business
It is a Micro Electronic Hardware business which is manufacturing electronic hardware products
and this business is owned by five partners. All are investing with equal ratio of 2 Million Each.

Owners
The designations of all partners will be as follow:

M. Ali Khan
Ali Ahmed Khan
M. Shan Malik
Mahin Mujahid

(CEO & Sales & Production Manager)

(Finance & Aftersales Manager)
(HR and Operations Manager)
(Marketing Manager, Head of R & D)

Name of Business
The name of the business is TECHNO SMART which represents that it provides a
complete technologically advanced package for home, offices and industries with one device.

Product Name

Techno Smart
Logo

Tagline

Tomorrows solution today!

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Product Design

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Description
TECHNO SMART is a new company that will provide high quality electronic hardware
products to its clients. TECHNO SMART will be a partnership owned business and operated by
M. Ali Khan, Ali Ahmed Khan, M. Shan Malik & Mahin Mujahid.
There is a high demand for such products in Lahore because people are becoming more
aware of convenient electronic products and they are willingly adopting them. Therefore,
TECHNO SMART has initially taken first step to manufacture such products in Pakistan.
It switches ON and OFF any electric product through sending sms from users mobile.
The user can attach max 6 electrical devices with it and a sim is required for its operation. It
uses electricity through its charger. This is a plug and play device.
The functions of the device are:

Multiple applications. (gates, barriers, garage doors, shutters and access doors,
generators etc.)
Impossible to intercept the sms.
Secure
Quick & easy
Unknown callers are ignored.
Open gates prior to arriving, no waiting on the road or getting out the car in the rain.
Let visitors and deliveries in remotely.
Can be operated from anywhere.
Power by the existing gate controller 12-24 Ac or DC supply.
For Home Use

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For Industrial Use

Mission Statement
To provide solutions for electronic equipments with high valued products and services.
Make TECHNO SMART the necessity of households by gaining customers trust and
satisfaction.

Unique Selling Point (USP)

The product itself is a unique product because it has a no range limit and can be
operated from anywhere in the world. The other uniqueness in this product is that customer
can operate any electronic appliance ON and OFF function with SMS.

Primary Objectives
The primary objectives for next 5 years would be:

To gain customers trust and satisfaction.

Position our brand effectively and obtain a reputable image.
Expansion of GSM HOME to other metropolitans, first in Punjab and then in SIndh
too.
To make this GSM HOME system the necessity of the consumers.
Generate reasonable profits

Location
Plot -234 Main Raiwind Road, Lahore
The office space is company owned and the necessary office equipment such as
computers, fax machine, photo copier and other engineering equipment.

Gap Identification

At this stage company is producing 10 units per month.

At this initial stage company has total of 10 workers and one outlet.
For future the company will be looking forward to increase its human resource and
outlets in different places in Lahore.
The company is getting a small amount of profit from the first year but after looking the
demand for this product the company is very keen to invest more so that company will
be earning good profits.
We dont have direct competitors.
The company has an advantage on this initial stage but the research and development
department is focusing to bring new changes in existing product and will be introducing
other new products.

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Porters Model
There is absolutely no direct competition present in the market. If the right sorts of
resources and action plan are followed the company can run this business very efficiently. In
this fast moving world people needs more comfort and ease in their life so to make your lives
easier such products are invented. Thus the need in the coming time is an opportunity for
Techno Smart.

Barrier to Entry
High industry profits become the reason of entrance of other firm in the industry. By
avoiding this barrier can be created for these firms. When a firm is charging high profits and
high cost to the customers then that firm is making an increase in the entrance of other firm in
the industry. This company is using a cost plus pricing strategy at start which means that they
are charging a minimum profit over each unit. This will cause the industry to remain disciplined.
Patent are also one of the barrier to entrance. When the company product is patent other firm
are not allowed to share the market for a certain time period.

Supplier Power
There are number of competitive suppliers in the market because the raw material
which the company require is easily available. Due to that the power of supplier is weak so it is
not a big issue for the company to switch supplier and supplier needs to create good relation
with company.

Buyer Power
This product is innovative and has no such product available in local market. So the
company has a huge number of buyers available who are willing to buy innovative products.
The product is standardized and the company has its own distribution network. Buyers are
fragmented so no buyer has any particular influence on this product and on its price.

Threat of Rivalry
In the traditional economic model, competition among rivals results profits to zero. The
rivalry of this company is low and market is disciplined. However If some other firm comes in
the future to share the profits of the market it will decrease the discipline in the market. When
some rivalry comes in the future the company has these options to get safe from the attack,
firstly by changing the prices of the products secondly bringing a change in the product
differentiation.

Threat of Substitute
Substitutes exist in Pakistan but company is focusing on research and development side
to bring more innovation in the product. The threat of substitute increases when the price of
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the substitute decrease and the market share increases. By keeping in mind the price of this
products is set accordingly to the minimum level of profit.

Pest Analysis
Political
The government plays an important role in the operation and manufacturing products
and services in terms of regulations. Following are some of the factors;

Tax policy
o Due to the unpredictable political and governmental changes rules and
regulation are changed quite frequently. Currently government has increased
the taxes.
Employment laws
o Child labour laws are there and employees rights and laws to safeguard their
rights.
Environment regulations
o No such material is allowed to be used which cases an increase in the
environmental pollution.
Trade restrictions and Tariffs
o Import duty and other restriction on import items.
Political stability
o Now a days Pakistani environment is instable due to political clashes among
political parties.
o Inside country war and drown attacks in north frontier areas. This political
instability has led to uncertain environment in the country, which is a threat for
any business

Economic
Economic factors affect the purchasing power of potential customers and the firms cost
of capital. Few factors which exists in Pakistan economic condition are:

Inflation rate
o Due to inflation the cost of doing business is also gone higher. Inflation remains
the biggest threat to the economy, jumping to 7.9% in 2006 to 23.3% in first
quartile of 2009. This increasing ratio will hurt the buying power of the
consumers that will overall reduce the demand for the products.
Exchange rate
Interest rates
Economic growth
o Pakistan has a growing upper class with relatively high per capita incomes.
o The unemployment rate is going up and up with the increase of level of poverty
that is reducing the buying power of the people that is threat for mobile brand.

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Economic conditions are influenced by political and government policy, being a major influence
affecting these can affect the companys strategies. Overall economic conditions are not very
sound. The country risk of Pakistan goes to 3 which is alarming situation for Pakistan.

Social
Social factors include the demographic and cultural aspects of Pakistan. These factors
affect customer needs and the size of the potential market. Some social factors includes;

Health conscious people

o People are more health conscious and people have now trend to get more and
more convenience in their lives.
Population growth rate
o The total population of Pakistan is approx. 1.8M.
o The population is increasing rapidly which increase the number of cellular usage
and help in projecting high profits.
Age distribution
Career attitudes
Emphasis on safety
o The rate of theft and robbery is increasing.
o People are investing in safety of their families. Before no one worries to get a
security system for their home but now people are even paying approx 20,000 to
40,000 annually to companies for their home security.
Cultural
o The culture of Pakistan is rigid in term of adopting new technologies.
o Increasing globalization has amplified the influence of western culture in
Pakistan.
o People are aware of what new technology is being used.
o The life style of Pakistani people is changing rapidly.
o People are more conscious about their status.

Technological
The technology factors can also lower the barriers to entry and can reduce minimum
efficient production level some technological factors include;

Research and development

Rate of technological change

Awareness of technical products is increasing. Due to rapid technological advancements

to cope with this situation is a tough job. But if a company achieve this situation then it would
be not hard for the company to survive and to get a large market share.

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SWOT Analysis
Strengths

No need to carry keys and buttons

Can be operated from everywhere
Long backup time (mobile battery)
Strong R&D and product related innovations
Good quality of product
Durability
Uniqueness in products
Services
Plug and Play

Weakness

People like more foreign brands in technological products.

High R&D cost
Delay time of (few seconds) in Operation

Opportunities

Wide range market

Low SMS prices (SMS packages)
Peoples interest in new technological Products
Increasing rate of robbery and theft force people to buy such products
Load shading.
High cost of electricity.
Multi-Devices can be attached.

Threats

Ups and downs in the political and economic conditions of the country
Substitutes available

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Market Size and Trends

This is a new company in market with innovative products and assuming that there must
be a lot of buyers and there are a huge number of customers who are willing to purchase
innovative technological products in Pakistan. As the product shows by itself that, its a high
technological product and as well as highly differentiated product, being a costly product we
are targeting the middle upper and upper class segments for this product.

Market Growth
People are accepting innovative technological products and becoming conscious
towards convenience products, so the market of technological hardware products is expanding
rapidly.

Government Policies
Due to the instability of political status of Pakistan, there is always a threat of changing
policies regarding taxes, trade policies and trade agreements with other countries.

Population Shifts
Population is increasing day by day and people are changing their life style from joint
family system to individual systems. Where in joint family, the whole family uses one TV but
when this joint family system convert into individual system then needs and wants expands. So
that is a positive impact on the industry as well as on the product acceptance.

Growth Potential
This is a company which manufactures innovative products and have budget of 10
million and have competent work force that enhance the companys growth regarding HR and
R&D departments that works for the customers needs and wants.

Barriers to Growth
Ups and downs in the political and economic conditions of the country can become a
barrier. Reluctance of people towards adopting new product can create a hurdle in achieving
our task. Rivalry in future, new tax and tariff policies from the government side may act as
obstacle in retaining our position in market.

Competitor Analysis
As our product is unique and innovative in our local market, so there is no direct competition
but indirectly there is some competition with foreign companies products. People can use
these substitutes when Techno Smart products are available and that can affect the companys
sales as well as profits.

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Market Segmentation
Demographic Factors
Demographic factors play an important role for a company while choosing its segments.

AGE Above 18
GENDER Male & female
INCOME As our target segment is middle upper and upper class, so the income of
our target segments above RS 80, 000.
OCCUPATION The major occupation of our target segments is professionals,
businessmen, people having executive posts.

Geographic Segmentation

REGION: Lahore
SIZE 1,772 km2 (684 sq mi)
POPULATION 180M
CLIMATE Rainy, long and extremely hot summers, dry and warm winters, a
monsoon and dust storms

Target Market
As the product shows by itself that, its a technological product and as well as highly
differentiated product, being a costly product we are targeting the middle upper and upper
class segments for this product. We are targeting:

Main residential areas of Lahore (DHA, Model Town, Johar Town, Garden Town.)
Middle upper and Upper
Business
Home.

Target Market Description

Techno Smart is a product which is for the use in commercial building and as well as in
households. This product is a bit costly from normal locks but is cheaper from other electronic
locks. So it targets market is middle and upper middle class.

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Value Proposition
Techno Smart is offering products that make convenience in customers life. It also gives
customer piece of mind and relaxes from doing same functions daily and many times a day.
Customers will save their valuable time by installing Techno Smart product. It will satisfy the
customers needs due to the innovative technological product. Techno Smart promises to
provide innovative products according to the customers taste like Techno Smart offer this
product which have many benefits in one product like it can be used with 8 electronic products
in one time.

Pricing Strategy
Techno Smart is using the Cost plus pricing strategy because it is new company in the
market and just gaining low profit margin. Techno Smart wants to make himself strong image in
customers mind then change the pricing strategy. The cost of product is 12,000 and selling it at
15,000.

Sales & Distribution Strategy

Distributors are the institution through which availability of products is possible.

Techno Smart is distributing its own products.

Each product is sold at a price of Rs.15, 000.
The Techno Smart manufacturing unit will be in Raiwind Road area.
The companys sales point will be in Hafeez Centre.

Advertisement & Promotions Strategy

Advertisement & Promotions is the main factor behind the every companys success. So
the company is focusing much more in the advertisement of the product through different
advertisement channels in other words Techno Smart is adapting Media strategy.

News Paper (Dawn)

Local Cable Ads
Brochures
Stalls
Direct Marketing
Social Media

Elements for Deciding Media Strategy

Affordable easily by Techno Smart (keeping in view our budget)

Maximum coverage of our target segments

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Organizational Structure
5 Technicals
Sales
Production

5 call operators
2 Staff Worker
3 Coworker
2 call operator

Finance
Aftersales

1 staff worker
2 coworker

CEO

1 staff worker
Human Resource
Operations

2 coworker
2 receptionist
3 call operator

Marketing
R&D

1 staff worker
3 coworker

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Role and Duties

CEO & Sales Manager M. Ali Khan

o Will manage the strategic plans and policies, e.g.
Creating culture
Building senior management team,
Financing
Meeting with the delegations
Supervising works of others
Sales monitoring
Production control and monitoring
Finance & Aftersales Manager Ali Ahmed Khan
o Will manage all the financial issues of the company and will have the
responsibility regarding financial activities of the company.
o Managing compalints
HR & Operations Manager M. Shan Malik
o Will manage Human Resource and Operations department.
o Responsibilities will include
Recruitment & selection
performance appraisal
quality management
Effective operations management.
Marketing and R & D Manager Mahin Mujahid
o Will manage all the work related to marketing.
o Execute marketing skills in making marketing strategies, marketing plans and will
have the responsibility of promoting the product.
o Innovating and enhancing product line
o Strengthening product image through R & D

Staffing Plan Salary Structure

Designation

No.

Salaries / month (Rs.)

Expert Technicals

40,000

Technicals

25,000

Staff Workers

10,000

Coworkers

10

6,500

Call operators

10

10,000

Receptionist

8,000

Clerical Workers

4,000

All workers will have multi-tasking abilities

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Critical Risks
Potential Problems
Political Instability
As political condition of our country is very critical and we are starting new business so
turnover of Government can result in increase of taxes, import duties and subsidies.

Management Problem
Company can face management problems like we are new in the business and launching
a totally new product in Pakistan so we can face problem in hiring of skilled labor and
employees related to that technical field.

Insufficient Capital
We can face capital problem so we have to bear in mind not only the costs of starting,
but also the costs of staying in business.

Technological Problem:As our business is related to technology and it is a totally new concept of automated
home security system so we can face problem in technology.

Location
We have to open our franchises in overall Pakistan so location of our franchises and can
also be a problem.

Electricity Barrier
As economic conditions of our country is very critical and load shedding is a big barrier
which can stop our company to achieve our target.

Buying Behavior
People are stick to the manual home locks and it is very difficult to switch them to
automated home security system. They will have following questions in the mind.

Is it user friendly or not?

Is it reliable or not?
What about warranty and after sale services?

Operating Problem
At users end there operating of device can be a problem because firstly they use
manual locks for home security and manual switches and it is very difficult task to switch
people from manual system to electronic system.

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Obstacles & Risks

Obstacles

As there is no direct competitors of us but there are many indirect competitors and our goal
is to beat them and capture the market so biggest obstacle in our way is price difference, of
course we are providing most advance technology but the manufacturing cost is also high
so will people give preference to our product on manual home security system or not?
As this business is partnership based so decision of all will be the final decision this is
personal obstacle for all in achieving personal thinking for the organization.
How will people behave when we launch the product? Do I have the right physical
environment to achieve my goal?
War and terror situation in the country is also an obstacle for expanding our business.
Is this capital enough to survive in the market?

Risks
There is always risk involved in starting a new business. We are investing a huge sum of
money in the current situation of Pakistan which is the first risk.

Lack of Adequate Capital

Import of china products
Market risk is a result of many factors, including whether the market is large enough to
support your business, whether the market is growing, what trends exist in the industry,
how the competition is structured, and how distribution works.
Operational risk deals with whether the business can set up internally to deliver goods
and services to customers effectively.

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Contingency Plan
Utilize Multi-tasking
If we face management problem than we will outsource our hiring process and hire
those people who have multiple skills and utilize the multi-tasking capabilities to reduce
expenses.

Pricing
We will apply low profit strategy as Zong is doing in Pakistan even we can fix price to
breakeven point for sometime when we feel our product is going to fail due to price .

Capital
If we will face capital deficit than we will fulfil our need from angel capitalist.

Cope with Load shedding

To minimize the load shedding problem we will use generator during working hours
which can increase cost but minimize the probability of business failure.

In case of Theft of Techno Smart Lock Device

If the operating device or command of controlling home security system is stolen from
the user than we will have full control to block the device on single call of the customer which
can increase customer satisfaction and can be a success factor for us.

Awareness of Product Use

If our product will fail due to comprehensive system of controlling, than we will start
campaign on tutorials of operating the device which can change customers perception &
occupy positive share of mind of customers.

Exit Strategy
As we are investing 15 million (10 M equity + 5 M loan) so we can exit this business if we
will come up 50% loss of the total investment that is 7.5 million. If we bear 50% loss then we
will sale out our business.

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Operations
We will start our operation from different university links & social network because this
way is perfect for our business as we can enjoy different benefits here. Techno Smart Lock
Device product idea for our business because it is totally new and innovative idea.
Being first movers, no first data could be obtained to measure and forecast the demand
and trend of market. Therefore, we have taken the expertise of professionals & discussion with
several enterprenuers in regard to our product and decided to launch the product.
After deciding to launch Techno Smart now we have to gather all the required material
to develop it. It contains

A lock
Capacitors
ICs
GSM kit etc.

We contacted a lot different suppliers for each item required and held negotiations with
them how the relation between them and us continues.
No formal machinery is available to assemble our product therefore all the assembling
process will be manual.

Capacity Management
Capacity Management contains all that activities which are related to, the number of
units a facility can hold, receive, store or produced in a specific period of time.
Capacity Management tells us about the design and actual capacity of the company.
Companies can judge the effectiveness of its capacity planning on the basis of its percentage of
utilization and its percentage of efficiency.

Design Capacity
Design capacity is the maximum output of the system means how many maximum units
can company has produced, hold and store by using its given resources.
In case of our company Techno Smart we have set our design capacity after analyzing
all given resources the maximum units which we store, hold and produced is 360 units in a year.
Its mean almost 30 units produced in a month.
Design Capacity = 360 units/year

Effective or Actual Capacity

Effective or Actual Capacity is the capacity a firm expects to achieve according to current
operating constraints or in other words we can say the units which company has actually
produced by using its given resources. Effective Capacity is usually lower than the design
capacity.
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Foreseeing the design capacity to produced almost 360 units of Techno Smart in a year
but according to the current situation of Pakistan we have faced lots of problems that create
hurdle for us in order to meet our design capacity. In current situation are facing the issue of
load shedding, strikes and Absenteeism etc. Therefore we are far away from our design
capacity and actually the units we will be able to produce in given situation are 300 in a year or
almost 25 units in a month.
Effective or Actual Capacity = 300 units/ year

Utilization
The formula which we normally used to calculate the utilization of any company, factory
etc is given below:
Utilization = Effective Capacity/ Design Capacity
Utilization of Gsm Home for 1st year is:
Utilization = 300/ 360
Utilization = 83%

Supply Chain Management

The operations of supply chain starts from supplies of raw material to delivery of
finished product to customer. As the flow chart diagram which is given below clearly shows the
whole process of supply chain management very clearly.

Suppliers

Assemblers

Outlets

Cutomers

Techno Smart also follows the same operations of supply chain which is given above.
Suppliers which are selected by the management of the company will supply the needed parts
of the product to the production plant where the production department assembles all parts of
the product. After that the final product distributes as per demand to companys own outlet.
Then retailers of the outlets deliver the finished product to the customer.

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CONCLUSION
Concluding the above, we can say that Presently, the industry welcomes Techno Smart
products with open arms as there is absolutely no competition present in the market if the right
sorts of resources and action plan is followed a monopolistic position can be created and this
although seems big for a newly formed organization. A strong reason to believe that this
venture has huge potential is the need for such product that we plan to offer, in this fast
moving world people needs more comfort and ease in their life so to make your lives easier
such products are invented. Thus the need in the coming time is an opportunity for Techno
Smart.

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