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Table of contents Pages 1.0 Executive summary 1.1 Objectives 1.2 Mission 1.3 Keys to success 2.

0 Company summary 2.1 Company ownership 2.2 Company logo and meaning 2.3 Startup summary 2.4 Startup funding 3.0 Product description 4.0 Industry Summary 4.1 Overview 4.2 5 forces analysis 5.0 Market Summary 6.0 Implementation and strategy summary 7.0 Financial Summary 7.1 Assumptions 7.2 Projected Income 7.3 Projected balance sheet 7.4 Projected cash flow 2-3

3-4

4-6 6-9 9-10 11-13 13-15

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1.0 Executive Summary EnterSun is a start-up company located in Dhaka, Bangladesh offering customized solar power solution for rural households. The company also serves the retail market for a better market-share and a high turn-over to support its rural development programs. The Market The market for solar power is huge in Bangladesh where they get over 245 days of sun a year. EnterSun has identified two distinct market segments that they will market their products to. The first segment is the rural people deprived of grid-power facility. This segment has potential size of 2.5 million units. For effective implementation of business plans, EnterSun has decided to operate in Tala Upazila of Satkhira district for the 1st 5 years. Success in this project will enhance the brand image of EnterSun resulting in a nation-wide market coverage in the future. The second segment is the installers (offices, high tech housing) who will be reached through the retailers. This segment is generally environment-aware, therefore much importance would not be provided to this sector during promotional activities. The Products EnterSun will sell three different versions of a solar home system: Small(20 Wp), Medium(90Wp), Large(150Wp). These packages have been designed according to the varied need of the target consumers. The unique selling point of the packages offered by EnterSun is that it introduces tracking facility. This increases the system efficiency to create high levels of consumer loyalty in return. Direct consumers will be given the opportunity to make payments in installments and theyll face a lower price compared to the retail price. This differentiation would be carried out for the sake of the rural development as well as the organization itself.

1.1 Objectives To become the premier solution provider in Solar Housing System in the rural Bangladesh. To quickly gain market penetration within the first five years. To develop a customer-centric organization based on cutting edge technology. To enhance market share thorugh pull-selling of SHSs in the urban high-tech buildings.

1.2 Mission To become the premier solar housing solution provider offering the most efficient models for power generation and high quality customer service while enlightening the backward rural Bangladesh and pacing Bangladesh towards a better, greener future. 1.3 Keys to Success 2|Page

EnterSun has identified three keys to success that help the company grow into a mature market leader: Providing cutting edge, reliable, and simple-to-install and maintain solar power systems.. Broadening the market of solar and fevtir into a mainstream energy source. Designing and implementing strict financial controls.

2.0 Company Summary 2.1 Company Ownership EnterSun has been formed as a sole proprietorship . The main stakeholder is XYZ. 2.2 Company logo and meaning

The Enter stands for the computer key Enter- that enables a user to start a process. The company name has been decided with the vision you should press enter for solar power, we are the SHS providers who will enable you to start this process. The S in the logo is purposefully colored in green to express the organization vision to switch over to a greener power option. 2.3 Start-up Summary EnterSun will require the following items for start up of the business: Computer system- the required components of this system include seven terminals, four laster printers, one central server, broadband Internet connections, and Microsoft Office for all computers, two ACT! licenses, and two QuickBooks Pro licenses. Laptop computer and LCD projector. Website development.

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Office furniture including desks, cabinets and chairs for seven stations. Waiting room furniture. Eight extension telephone system including a hardware-based voice mail system. Three large white boards. Fax machine and copier. Racks and shelving for the warehouse.

2.3 Start up funding Start up requirement would cost around 20 Million BDT. EnterSun will finance the company solely on bank loan of 25 years by mortgaging personal property of XYZ. 3.0 Product Description 3.1 The product The sun is the planet's most powerful source of energy and also the most unused source of energy by humans. Solar power is a clean, environmentally friendly source of energy. It is renewable meaning it is impossible to consume the energy at a faster rate than it takes to replenish it for future users. There are no toxic byproducts or emissions. EnterSun is an effective system that harnesses the sun's energy for family power needs. Solar Photovoltaic(PV) is a device which directly converts sun light into electric energy. A typical solar home system(SHS) will have the components Solar PV module Battery Charge controller Lamp Cable Inverter Mounting structure

However, EnterSun introduces a newer home system with sunlight-tracking facility. A research team working at MIT has recently proposed this model as they find that tracking facility enhances the efficiency of the total system by 38%. All it requires is an additional motor that will help the panel move towards sunlight. Besides, an extra unit of battery would include the product offerings. This is the backup battery that can be charged during long-summer days and used during the monsoon, when sunlight can not be availed for days.

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Fig- Typical SHS 3.2 Packages EnterSun emphasizes on the different needs of the consumers. For its primary target market, EnterSun has 3 packages to offerPackage 1: Small For family member ranging from 4, Up to 8 and Poor Class Required Rated Power- 20 Wp Two fluorescent lamps (5-7 W each), One Mobile Charger (4.5 W each). Operating Hour: 7-8 Hours (Has been increased for efficient tracking system)

Package 2: Medium For Family Member Ranging 6, Up to 10 and Medium Class Required Rated Power- 90 Wp Nine fluorescent lamps (5-7 W each), Two Mobile Chargers (4.5 W each) and One Black and White TV (12V DC). Operating Hour: 7-8 Hours (Has been increased for efficient tracking system)

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Package 3: Large For Family Member Ranging 6, Up to 10 and Higher Class Required Rated Power- 150 Wp Seven fluorescent Lamps (5-7 W each), one Black and White TV (12V DC), One fan (72 W), Two mobile Chargers (4.5 W each) Operating Hour: 7-8 Hours (Has been increased for efficient tracking system) i) 3.3 Allocation of components Battery: For longer durability, tubular plate battery is preferred over flat plate. Major manufacturers include Rahimafrooz, Rimso, Hamko, Navana, Panna and few others. High import duty(25%) on finished goods discourages import of this component. However, frequent shortage faced by the competitors might force EnterSun to go for the import option. Charge Controller: Most of the charge controllers currently used under IDCOL solar program are locally assembled. Major assemblers are Innovative Technologies, Grameen Shakti, Easy Electronics, MSi Technology, Technosol, CMES, Energypac etc. Inverter: Inverter circuits are being locally manufactured. Solar panel: The panel with multiple cells and a mounting structure is imported from India, China in parts and then are assembled. Assembling responsibility is on the service provider. Lamp: Most of the lamps used under IDCOL solar program are fluorescent lamps (FL), though CFLs are becoming increasingly popular. Though Inverter circuits and casing for FLs are locally assembled / manufactured fluorescent tubes are still 100% imported. Major assemblers are Innovative Technologies, Grameen Shakti, Easy Electronics, MSi Technology, Technosol, PSL etc. Energypac is the only local assembler for DC CFLs. Existing assembling capacity is 100,000 per month

ii)

iii) iv)

v)

3.4 Product Pricing Custom and retail prices for the 3 packages are as follows Package 1: 30,846.20 BDT for the direct consumers 35,473.13 BDT for the retailers. Package 2: 37352.7 BDT for the direct consumers 39050.55 BDT for the retailers Package 3: 40817.7BDT for the direct consumers 42673.05 BDT for the retailers The logic behind a price discrimination has been elaborated in the strategy section.

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4.0 Industry Summary 4.1 Industry Overview The map presented on the right side of this analysis is a pictorial representation of energy crisis prevailing in Bangladesh. The red lines create criss-cross on the country map to show availability of electricity in places. It fails to cover all the area and also fails to meet existing demand in the areas covered already. Only 45% of the population has access to grid electricity and consumption per capita is one of the lowest (145kWh per annum) about 1/18th of world average. An access rate so low accompanied by low consumption owing to failure of conventional energy solutions creates huge demand for alternative sources of energy in Bangladesh. 3560% of this quantity demanded is satisfied with the use of Biomass, mostly in rural Bangladesh. However, geographical position of the country(that allows the country to receive 4-6.5kWh/m2 on a daily basis), residue free energy generation, user-friendly interface and also the attraction of zero operating cost- these are the factors that made people accept solar solutions in large scale. With only 15% of the population having access to Electricity, the uses of Solar Home System as an alternative source to power generation in individual level began in 1996. Grameen Shakti was the pioneer and the industry has later on been ventured by several organizations, such as- Rural Services Foundation, Brac etc. These organizations are responsible for a monthly installation of 30,000 SHSs on an average, lighting the lives of about 150,000 people. RahimAfrooz, Navana, Electro Solar, Maxtech are some of the players in this industry who are currently working on the supply of several components for a Solar package. At present, 100% of the local demand for Solar PV is met by import of these materials from China, India, Japan and Germany. These are then assembled here and then installed as per consumer demand. To ensure a better living of standard for the rural people, Bangladesh govt. has facilitated this industry with several grants. Declaration of 5 years tax holiday for Solar PV plants, duty free material import, feed-in-tariff policy are some of the initiatives that have been adapted by the govt. for the industry growth to its optimum. Since. Bangladesh has a low per capita income and most of her people have $1 to spend for their daily consumption, paying for a package with installation would be difficult. IDCOL, backed by donations from World Bank, ADB, KfW etc. has provision for Capital Buy Down Grant to help poor households to reduce initial cost of the system. As the industry has hope for wide commercialization, both types of grants reduced with the progress of the project. Of all its applications (Water irrigation, Street lighting, Water pumping etc.), SHS has been the most popular and the expected sales growth of the industry is as follows-

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Figure 2- Projected installation of SHS under IDCOL program. 4.2 Porters 5 Forces Analysis For the new entrants Entry Barrier/ ease: Grameen Shakti, Brac , RahimAfrooz dominate the market. Resource allocation is difficult for lack of local manufacturer. High initial cost of installation minimizes potential consumer number. Huge amount of sunk cost as initial investments is also a barrier. Buyer bargaining power: Govt. policy requires the lowest bidder to get the transaction permit. Unawareness, reluctance to adapt SHS forces the service providers to reduce gross profit margin. Supplier bargaining power: Local companies are price-takers for having insignificant number of local producers of components. Competitive rivalry: Currently 16 local companies are competing in the market for Solar Energy Solution. Resources are mostly imported, batteries are locally manufactured. Product/ Technology development: 8|Page

Brand status: low Recent trend for on-grid users to switch to Solar power might play a big role in the urban market. Competition in price is a unique feature. Windmill, Biomass are some of the easily implementable solutions to power crisis. Therefore, threat of cost-effective substitutes does exist. 5.0 Market Summary 5.1 Market Segmentation Solar PV market has consumers with different needs SHS under IDCOL SHS program (only in off-grid area) Solar mini-grid (both off-grid/grid areas) Water pumps for farming Base Transceiver Stations (BTSs) of telecom companies (both off-grid/semi grid areas)

The existing buyers of SHS are from 2 sectors International: private organizations working on providing solar services outside the national boundary National: Local consumers- individual, organization. The national market has all sorts of consumers. People living in the urban with electricity facility with their high income have the opportunity to switch over to a green energy option whenever they want. Due to Govt. Protocol, real estate companies have to design a portion of power-supply using solar module. Besides, the incentives on using allure people to switch. On the other hand, people from rural Bangladesh are the most potential buyers of several Solar PV packages. With no/limited access to national grid and a high coverage area available for rooftop solar modules, this segment depends more on this solution than others. Local companies, govt. offices wanting to go for a green energy option are also a segment of this huge market. To accomplish its mission and objectives, EnterSun will target the rural households only and segment the consumers on 2 criteria Family size: Nuclear family with 3-4 members, Nuclear family with 5-8 members, Joint family with 4-10 members. Monthly family income: below 5000BDT, 5000-15000, 15000-25000, 25000-40000, above 40000. User status: Nonuser, first-time user, regular user. Readiness status: Unaware, Aware, Interested. Attitude towards Solar Solution: Enthusiastic, Positive and Negative. EnterSun packages and services will reach the target segment through 2 channels-

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Retailers: This channel(comprising Grameen Shakti, Brac, RSF and other retailers) purchases EnterSun products in quantity and then installs the units in their coverage area. Professional Installers: This channel is comprised of approved EnterSun installers.

Market Analysis

Year 1 Potential Customers Retailers Consumers Total 1500 500 2000

Year 2

Projection of sales volume Year 3

Year 4

Year 5

3000 1500 4500

5000 3500 8500

7500 5000 12500

8000 7000 15000

Table Projected sales volume in consumer market For the direct consumer market, EnterSun has decided to start their journey in Tala, An upazila in Satkhira, Bangladesh. Gradually, it expects to spread its business all over the country. 5.2 Target market segment strategy To discuss the strategy behind the target market selection and its segmentation, 2 questions are to be answered properly Why the rural households? Charity begins at home - EnterSun believes that the betterment of living standard should start from home. Unless power crisis is solved on personal level, professional purpose will not be able to enhance life standard properly. That is why, the organization has focused its vision to service the unique household needs only. From a marketers perspective, 2.5 million potential consumers belong to this sector with dire need for power. While irrigation and water pumping has been given much attention, this sector has suffered for want of better solutions. The USPs offered by EnterSun are expected to balance this discrimination and thereby result into a large market share with high turnover rates. Why Tala as the primary business destination? Satkhira is the most disaster-prone zone area in Bangladesh and Tala is one of the worst affected areas in Satkhira. A population of 2,94,000 and a power coverage rate of 20% makes the market size worth penetrating. With failure of conventional power supply process to resist disaster damages, Solar Solution is expected to cover the market within just 5 years of operation. Local NGOs, govt. grants will help the consumers make payments for the SHSs. With the existing manpower, the target segments can be reached effectively. For the existence of several market segments, differentiated product would be successfully offered to the community. These answers along with its mission clearly explain the logic behind targeting the rural segment.

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6.0 Strategy and Implementation Summary 6.1 Value Proposition Whoever you: a tech savvy urban-dweller or a power-deprived aspiring rural, EnterSun Solar Housing Systems with tracking facility and additional battery coverage is an alternative power solution that provides you with a more efficient power generation facility. With this proposition stated above, the proposition strategy for EnterSun could be determined as-

Price
Added benefits for a lower initial price.

Benefit

Figure- possible value propositions matrix

6.2 Competitive Edge Introducing a brand-new technology will surely add to EnterSuns competitive edge. A more durable and user friendly SHS will enable the organization to penetrate the consumer market without difficulty. The company vision on rural household needs will also facilitate the organization to be an excellent service provider with skilled technicians in this sector. Product Cannibalization may be a concern for the existing competitors , but not for EnterSun. 6.3 Marketing Strategy EnterSun has chosen for itself a Niche Market with millions of potential buyers in it. In the narrowly defined segment, EnterSun has carefully chosen suitable product design and product name. For the establishment of a smooth value delivery network, the company has adopted consumer-centric marketing strategy. The strategy will have pull effect on the retailers, where satisfactory review of 11 | P a g e

the current consumers will influence others to switch to EnterSun. Customer value, customer loyalty will be created through marketing efforts at 3 levels- External, Internal, Interactive. EnterSun itself will design the office power supply with Solar Modules to give the employees a significant on the importance of a green energy option. To maintain its unique position within the market, EnterSun plans to create a strong Brand Equity among the consumers. 6.4 Pricing Strategy The market practice is cost-based pricing, which will be adapted by EnterSun. Although the established players in this sector calculates a 20% profit margin for pricing. However, EnterSun has chosen a 10% markup in its initial period under Market Penetration pricing. This markup percentage has been designed for the rural consumers. Per capita income in Tala is at an all time low in the moment (resulting from loss of resources and assets during recent catastrophes). Moreover, a longer-lasting solution would ultimately turn into profit generation for the company if it succeeds to enlarge its market share through this penetrating pricing strategy. This lower pricing is also crucial to be replaced as the ultimate solution by the regular users. However, for retail pricing, EnterSun will charge 15% margin over the packages. 6.5 Promotion Strategy EnterSun promotion campaign focuses on raising awareness about the environmental and economic benefits of having a solar-based home system. Environmental benefits include using a renewable resource and no toxic discharge or emissions, thus allowing individuals to make serious commitments to the Earth. Customers will also enjoy the economic savings afforded by a solar water heating system. EnterSuns marketing will focus on advertising and trade shows to be in good terms with the retailers. To get the rural consumers attention, the organization will take resort to Roadshows, Billboards, TV commercials, Village Fairs for promoting the necessity of green energy alongwith its services. Breakdown of payments, association with IDCOL will be given similar levels of importance. Moreover, benefit of the solar tracking module, which is also a Unique Selling point for EnterSun packages will be explained to the common villagers for a quicker consumer response in favor of EnterSun. In addition, EnterSun will develop relationships with utilities in an attempt to offer rebates or other financial incentives for utility customers using the alternative energy source. 6.6 Sales Strategy The two-part sales strategy addresses each customer segment. As mentioned in the previous section, to reach the installers EnterSun Heat will work with retailers selling SHS units to inform them about the product and its superiority to the competition. Retailers sell the SHS units, it is important to have good relationships with them and to support them with as much information and resources as possible.

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EnterSun is in the process of developing a licensing program to address the professional install market segment. This program includes product information, installation training and certification of installers. The licensing program is the foundation of the relationship between installers and Sun Heat. To support this relationship, EnterSun assigns each installer an account executive for technical support. By offering this unmatched assistance, installers will more readily recommend EnterSun, thereby driving sales. To reach the direct consumer segment of EnterSun, huge amount of promotional activities will be carried out. The company will work alongwith the local NGOs in Tala for a time-effective promotion of its services. Sales representatives will meet the NGO officials to help sales and installation activities. An efficient installation team will work closely with the consumers during service hours. Based on their need, required package (recommended by the team consultant) will be installed within the shortest possible time. Initial training on the use of SHS would also be provided by the team. Maintenance and repair for the first 5 years would be done for free, while a warranty of 25 years would be provided for the packages. Implementation of internal and inter-active marketing strategy is expected to drive sales up as well as building close buyer-seller relationship. 7.0 Financial Summary The following sections will outline important financial information. 7.1 Important Assumptions The following table details important Financial AssumptionsGeneral assumptions Year 1 Year 2 Year 3 Year 4 Year 5

Annual Inflation rate Loneg Term Interest eate Inventory management accounting system 1 Dollar=

10.6% 9%

11.8% 9%

11.2% 9.5%

12% 9.5%

11.6% 9.5%

FIFO(First in first out)

84BDT

85BDT

85BDT

86BDT

86.5BDT

Table- Important financial assumptions

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7.2 Projected Profit and Loss Year 1 Net Sales 77,777,154 Less: Cost of 65,980,250 goods sold(sales units*cost per unit) Gross Profit 11,796,904 Administrative 9,000,000 expenses Promotion 25,000,000 expenses Utilities 4,20,000 Floor rent 900,000 Misc. expenses 500,000 Depreciation 90,000 expenses(1% on delivery truck) Net income (24,113,096) before interest and tax Less: Interest (2,220,949) expense Net income (26,334,045) before tax Less: tax -0Net profit (Loss) (26,334,045) Year 2 168,340,700 146,177,500 Year 3 Year 4 321,967,500 465,462,500 281,914,500 407,295,000 Year 5 558,597,000 312,380,000

22,163,200 9,000,000 1,000,000 3,50,000 900,000 800,000 90,000 10,023,200 (3,453,000) 6,570,200 -06,570,200

40,053,000 10,500,000 1,000,000 3,80,000 1,800,000 850,000 100,000 25,423,000 (2,546,800) 22,876,200 (8,464,194) 14,412,006

58,167,500 12,000,000 3,000,000 2,60,000 1,800,000 780,000 100,000 40,227,500 (7,675,400) 32,552,100

246,217,000 12,000,000 1,500,000 2,80,000 1,800,000 950,000 100,000 229,587,000 (15,897,450) 213,689,550

(12,044,277) (79,065,133.5) 20,507,823 134,624,316.5

7.3 Projected balance sheet Year 1 74,530,911.6 19,229,700 46,666,292.4 11,000,000 Year 2 11,055,746.1 19,229,700 138,337,453.9 11,000,000 Year 3 78,028,809.4 19,229,700 156,454,490.6 11,000,000 Year 4 Year 5 (54,516,098.1) 143,918,400 19,229,700 19,229,700 217,475,898.1 11,000,000 223,438,800 11,000,000

Cash Inventory, closing Accounts receivable Office equipment 14 | P a g e

Transports Less: Accumulated depreciation Net asset Accounts payable Notes payable Interest payable Tax payable Long term liabilities Earnings for the year Total liabilities and capital

9,000,000 (90,000) 152,236,904 26,350,000 -02,220,949 -0150,000,000 (26,334,045) 1,52,236,904

9,000,000 (180,000) 161,113,200 1,090,000 -03, 453, 000 -0150,000,000 6,570,200 161,113,200

10,000,000 (280,000) 274,433,000 106,100,000 -02,546,800 8,464,194 143,000,000 14,412,006 274,433,000

10,000,000 (380,000) 202,809,500 15,100,000 4,500,000 7,675,400 12,044,277 143,000,000 20,507,823 202,809,500

10,000,000 (480,000) 398,586,900 13,600,000 12,400,000 15,897,450 79,065,133.5 143,000,000 134,624,316.5 398,586,900

7.4 Projected Cash Flow

Year 0 Cash flow from operating activities Cash flow from investing activities Cash flow 150,000,0 from financing 00 activities Net increase(decr ease in cash) 150,000,0 00

Year 1 (55,469,08 8.4)

Year 2 (63,475,16 5.5)

Year 3 74,073,06 3.3

Year 4 (128,044,90 7.5)

Year5 190,534,49 8.1

(20,000,00 0)

-0-

(100000)

-0-

-0-

-0-

-0-

(7,000,00 0)

4,500,000

7,900,000

(75,469,08 8.4)

(63,475,16 5.5)

66,973,06 3.3

(132,544,90 7.5)

198,434,49 8.1

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