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NOORUDDIN MC070400829

TEACHER: CH. SHAHZAD ANSAR

ENTREPRENEURSHIP MGT-602
PROJECT – BUSINESS PLAN

RECYCLING PLASTIC
PLAN

Company Name & Address

Mc070400829
VIRTUAL UNIVERSITY OF PAKISTAN
MA JINNAH CAMPUS
DEFENCE ROAD,
OFF. RAIWIND ROAD, LAHORE
UAN: 042-111-880-880
FAX: 042-9202174
Our Statement of Confidentiality
The undersigned reader acknowledged that the information provided by the MC070400829
in this business plan is confidential, therefore , reader agrees not to disclose it without the
express written permission of MC070400829

MC070400829
Signature

Our Statement of Financial Needs


 There are three primary financial statements: The balance sheet, income statement
and statement of cash flow. Each one of these statements is equally important in
communicating the existing or projected financial health of the our recycling
business. These statements are prepared at the end of the financial year to assist our
business to consistently establish, meet goals and objectives.
o Income Statement:
 The major category in this statement are revenues and expenses
 Both revenue and statement are to be recorded in the year they are
earned or expensed, not when the actual cash is paid or received.
 Revenues: sales revenue, service revenue, and interest revenue.
 Expenses: salaries of executives, staff salaries, R&D expenses, bad
debt expense, depreciation for the current year expense, interest
expense, and income tax expense
o Cash Flow Statement:
 This financial statement deals with the cash transactions of the
business in a financial year.
 Each period for which the cash flow statement is prepared begins with
a beginning cash balance (which may be zero).
 Examples : any revenue received in cash is added and expenses paid in
cash are subtracted. The only transactions which are recorded in this
statement are those which have been made in CASH.
Executive Summary …………………………………………………………….1.0

Industry Analysis ……………………………………………………………….2.0


Future outlook and trends………………………..2.1
Analysis of competitors………………………….2.2
Market segmentation ……………………………2.3
Industry forecast…………………………………2.4

Description of Venture……………………………………………………………3.0
Product…………………………………………..3.1
Services…………………………………………3.2
Size of business…………………………………3.3
Office equipment and personnel………………..3.4
Background of entrepreneurs…………………..3.5.

Marketing Plan…………………………………………………………………..4.0
Form of ownership……………………………..4.1
Identification of partners………………………4.2
Authority of principals…………………………4.3
Management team backgrounds……………….4.4
Roles and responsibilities
of members of organization……………………4.5

Organization Plan ……………………………………………………………..5.0


Form of Ownership …………………….……...5.1
Identification of Partners…………………….. 5.2
Management Team Background ……………..5.3
Role and Responsibilities……………………..5.4

Assessment of Risk……………………………………………………………..6.0
Evaluate weakness of business ………………...6.1
New technologies………………………………6.2

Financial Plan……………………………………………………………………7.0
Sources of funds………………………………..7.1
Performa income statement……………………7.2
Performa balance sheet…………………………7.3
Cash flow projections…………………………..7.4

Appendix………………………………………………………………………..8.0
1.0 EXECUTIVE SUMMARY

 The purpose of the proposed MC070400829 Recycling Plastic Plan is to provide


resources which seeks to meet the day to day need of plastic consumable,

 The growing utilization of plastic in industrial and consumer applications, combined


with increased consumer awareness surrounding solid waste recycling, has lead to
increase demand for recycled plastic materials for recycling

 Replay Plastics will capitalize on the opportunities in the recycled resin and
packaging markets through two main divisions: a Recycling Division and a
Packaging Division.

 The sophisticated washing treatment plant installed at premises enables


MC070400829 to produce high quality plastic raw materials and plastic products
made from hundred percent post industrial waste.

 The plastic is then dried and extruded into high quality recycled granules on the
Company’s Double vented Japanese extruders. And in turn produced a large variety of
value added products.

MC070400829 is earth friendly and it provides a clean environment to this part of the world.
We firmly believe that it is everyone’s responsibility to recycle everything they can because
they can make the difference. We are trying so hard to stem the tide of pollution that is
overwhelming our beautiful planet. We encourage you to take a part in it.
2.0 INDUSTRY ANALYSIS

2.1 FUTURE OUTLOOK AND TREND


 Sales passing 15 million in first year, 31 million in year 2, growing to $43 million due
to high demand in the region.
 Gross margin of 35% or more in first year, 45% in second year then 50% or more.
 Net profit of 13% in year one, then exceeding 20% annually starting in year two.

The main key to success is that we will buy all kind of industrial/ post consumer plastic
materials and scraps in various forms, like baled/fluff/sheet/powder/rolls/others. Some of the
regular materials are listed below. If you have additional material related in plastic. We can
handle that too.

Material Form Color Quantity Description


full
HDPE Baled/lumps/fluff/powder & etc Natural /others industrial/post consumer.
container
full
LDPE Baled/lumps/fluff/powder & etc Natural /others industrial/post consumer.
container
full
LLDPE Baled/lumps/fluff/powder & etc Natural / Others industrial/post consumer.
container
full Post consumer
PET Baled/lumps/flakes/rolls & etc mix
container Bottle grade, preform
full
PS Lumps/Regrind/Rolls Natural /others INJECTION
container
full
PVC Baled/lumps/fluff/Rolls Natural /others extrusion
container
full Rejects/Surplus/Over
BOPP (ROLLS) all size mix rolls printed / unprinted
container Produce materials
full Rejects/Surplus/Over
PET (ROLLS) all size mix rolls printed / unprinted
container Produce materials
full Rejects/Surplus/Over
PP (ROLLS) all size mix rolls printed / unprinted
container Produce materials
rejected/surplus/
Audio/Video full
damage/broken/crush/rolls any overproduce tapesFor
Cassettes / tapes container
recycling
Tetra Pack full Rejects/Surplus/Prime
PE/Allu Coated Sheets/Rolls Unprinted
Reels/sheets/etc container Over Produce Material
Along with good resources we have enrich management and marketing capabilities to
promote our business to provide efficient resources. The forecasted benefits we will be going
to avail are as follows:

2.2 ANALYSIS OF COMPETITORS

Plastics' competitive edge rests with its proximity to its target markets, as well as the industry
knowledge, reputation and contacts of its senior management. Their many years of direct
experience have led them to identify this unique opportunity and put together the technology
and sources to take advantage of it. Their reputation in the specific market segment will
result in the achievement of long-term commitments for our production

2.2.1 OUR COMPETITORS

We have already surpassed the following characteristics through strategic planning and
forecasting, which will deal the most common competitive issues in our future run. Such
issues are
 Patents— We have already applied for our product under Trade Mark and Patent Law
 High start-up costs—In many cases, this barrier is the most daunting one for small
businesses, we have a huge investors and we encourage more to promote us.
 Knowledge—Lack of technical, manufacturing, marketing, or engineering expertise
apart from other competitors , we will resolve it as top level management of our
company is high skill and experiences.
 Market saturation—It is a basic reality that it is more difficult to carve out a niche in a
crowded market than it is to establish a presence in a market marked by relatively
light competition. We are not going to sell in open market. But our plan is to provide
distributors the chance to earn themselves and earn us revenue as target planning.

2.3 MARKET SEGMENTATION

We have already selected certain product to out market segmented audience. Such services
are
 Consulting,
 Size Reduction/Grindling,
 Subcontracting Jobs,
 Fine Seperation,
 Dry Blending.

2.4 INDUSTRY FOCUS

Our facility is equipped with the latest state-of-the-art single and twin screw compounding
equipment. Each of these instruments incorporates computer controlled operations and data
acquisition to ensure the optimum product quality and lot-to-lot consistency

Now under the MC070400829 umbrella all the companies are dedicated to providing a
superior level of service and quality. If you would like to try this for yourself visit the online
catalogue or contact us
3.0 DESCRIPTION OF VENTURE

3.1 PRODUCTS
We have a wide varities of product to offer which are carefully designed as per the rules and
regulations of IS0 9001-2000 to provide better quality plastic products / raw materials.

3.1.1 REPROCESS GRANNULES

The Reprocessed Grannules we offer has an


excellent balance of impact strength and flexure
modulus as well as offering high melt flow and
good processability .

3.1.2 GARBAGE BAGS

When it comes to Garbage bags ,Refuse sacks,


Refuse Garden sacks , Bin Liners and standard
can liners, Modern offers quality, reliability and
customer service at competitive prices.

3.1.3 PLASTIC PIPES

Excellent mechanical strength and impact


resistance .

Highly controlled production processes


leading to high quality pipe products .

No requirements for protective coatings .

3.1.4 PET BOTTLES

A technology leap that breaks the mold. With a


Bottle that provides all the multiple advantages of
PET. Its lightweight , its shatterproof , and its
recloseable.
3.1.5 PLASTIC MOLDED PRODUCTS

One of MC070400829 main aims is the drive for


new and innovative techniques to provide cost
effective solutions . Our house hold products such
as Hangers / Buckets / Cups and other

3.2 SERVICES
 Consulting,
 Size Reduction/Grinding,
 Subcontracting Jobs,
 Fine Separation,
 Dry Blending.

3.3 SIZE OF BUSINESS


 Strategist , Directors, Investors
 Top Level Management 3 Managers, Planning, Distribution & Finances
 Researchers , 5- 6 according to plant resources and new conducting operations
 Office Staff, 10-15 Accountants, Administration, Sales Rep, Outdoor Clerks
 Non Contractual Employee. 5 Peon and Sweepers to keep it clean
 Plant Workers , 10 Shift operators and technician

3.4 OFFICE EQUIPMENT & PERSONNEL


 Heavy Duty Machineries at Plant
 Office Furniture, Chairs, Tables, Filing Closet,
 Electronics, Computers, Servers, Routers, Radio Link Tower etc
 Accessories, Papers, Pen, Files etc

3.5 BACKGROUND OF ENTREPRENEUR


 Entrepreneur is currently studying in VU 3rd Semester, having 5-6 year experienced in
different industries such as, Commerce, Trade, Manufacturing etc and family history
of running different entrepreneur businesses.
4.0 MARKETING PLAN

4.1 PRICING
MC070400829 has chosen to focus on the production of plastic packaging materials from
recycled post-consumer beverage bottles. Because of the industry experience and expertise of
the management, we have identified a significant available market in the Pakistan
Unit Prices 2008 2009 2010 2011 2012
Recycled Bags 0.25 0.30 0.35 0.36 0.40
Recycled Mold Products 3.75 4.75 5.75 6.75 7.75
Recycled Bottle 0.45 0.50 0.55 0.60 0.65
Recycled Pipes 12.99 14.99 16.99 18.99 20.99

Direct Unit Costs 2005 2006 2007 2008 2009


Recycled Bags 0.5 0.10 0.15 0.20 0.25
Recycled Mold Products 1.75 2.25 3.50 4.75 6.00
Recycled Bottle 0.30 0.32 0.35 0.38 0.43
Recycled Pipes 9.19 9.50 11.75 12.80 13.17

4.2 DISTRIBUTION

 All of our initial marketing strategy will be to secure contracts in that segment, and
after reaching full planned capacity, look to grow in concert with that segment and
related markets.

 We see little need at present for further market research and development, and will
focus on continually updating our production technology in an effort to remain in the
forefront of our chosen marketplace
4.3 PROMOTION PRODUCT FORECAST
Milestone Start Date End Date Budget
Advertising 1/1/2009 31/12/2010 Rs.5,096,256
Banners 1/1/2010 31/12/2012 Rs.1,553,896
News paper Adds 1/1/2009 31/12/2012 Rs.1,099,153
Brochures 1/1/2009 31/12/209 Rs.226,153
Rewards & Incentives 01/01/2011 31/12/2011 Rs.300,000
Awards 01/01/2012 31/12/2012 Rs.824,542
Scholarships 01/01/2010 31/12/2012 Rs.1,000,000
Totals Rs.10,100,000

4.4 CONTROLS

Because the Company is a start-up, our milestones will surround the establishment of
continuing facilities, confirmation of sourcing and sales contracts, equipment acquisition and
installation, staffing and training, and initiating production

 Order Equipment
 Secure Location
 Hire & Trained Skilled Labor
 Hire Plant Manager
5.0 ORGANIZATION PLAN

5.1 FORM OF OWNERSHIP

 MC070400829 is owned by the initial founders, Nooruddin and other investors who
are the proposed three executives of the operating entity.

 The plan was conceived and developed by these individuals, with the intent to apply
their extensive experience and contacts in the industry to building a successful
profitable corporation

5.1.1 START UP SUMMARY


Our largest Start-up Requirement is the building of the recycling and extrusion facility. Its
final value at completion is listed below as a long-term asset of 7,620,000. Aside from the
building itself, we need 2,500,000 in machinery and fixtures, 5,000,000 of inventory (plastic
raw materials) and cash to cover us through the initial year.

5.2 IDENTIFICATION OF PARTNERS


NOORUDDIN , one of the active partner is the student studying in VU MBA 3 rd Semester.
Alongwith Investors from different part of the Pakistan enjoying their return for the initial
investment they have made to purchase Bonds of MC070400829

5.3 AUTHORITY OF PRINCIPALS

Chief Executive Office alongwith the Top, Lower


And Middle Managers playing their parts. Also
to focus on stakeholder whereas the future
Investors
5.4 MANAGEMENT TEAM BACKGROUND
MC07040829 currently has commitments from customers to purchase all of the initial
production capacity. Excess flake will be sold to outside customers. All contractual planned
and skilled labor from top managers upto lower plant workers will be higher based on
expertise and qualification.

Nooruddin, President and CEO, has a history of working in this type of industries for the last
5 years as a junior and have the capabilities to work with other to encourage potential hidden
inside the plastic business
Mr. Arif Karim, Investor in Money Market for the last 10-15 years have a portfolio of more
than Rs.1,000,000 in different securities
Ms. Sarah Zain, SEVP and EVP in Garfield Bank in Forex and Treasury Division and have
the founding that this business have potentials in the future to attract investor
5.5 ROLES AND RESPONSIBILITIES OF MEMBERS OF ORGANIZATION
Production Personnel Responsibilities
Shift Supervisor To supervise all day to day operation and keep it going
To maintain all technical solution arise from non
Maintainence Techs
functionality of machinery
Skilled Recycle Plant Labor To produce and make it available within time
Production Assistant (full time) To assist in production issues
Sales and Marketing Personnel To make sales and keep achieving their targets
General and Administrative
Responsibilities
Personnel
President To make deicisions
Vice Pres COO To assist in making decisions
CFO To control of all financial operations and forecasting
Plant Manager To achieve by producing as per given target
Accountant Day to day balancing of books
Clerk To assist in miscellaneous activities
Shipper Receiver To keep track of inventories.
6.0 ASSESSMENT OF RISK

6.1 EVALUATE WEAKNESS OF BUSINESS

6.1.1 Limited Supply of raw material


 Recycled Plastics s are in high demand, and demand is currently under-supplied.
 Many manufacturers are delaying expansion because of uncertainty of supply.
 Entrants would have to consider sourcing post-consumer or post-industrial waste and
clean and refine it rather than attempting to purchase flake on the open market.

6.1.2 Equipment costs are high and industry specific, resulting in a high exit cost.
 Because of the scarcity of RPET flake, entrants may be forced to establish cleaning
and refining facilities for post-consumer bottles.
 The equipment required is costly and very industry specific. It would not easily be re-
sold as a system.
 There is a market for used extrusion equipment, which normally sees 60-70% of new
value being realized.
6.1.3 Vertical integration is an important consideration and difficult to accomplish
successfully.
 Because of the scarcity of RPET resin, and to maximize profit potential, entrants must
consider a two-stage production facility.
 Cleaning and refining post-consumer bottles and extruding the resulting flake into
commercial products requires a management team such as Replay has, with a broad
range of expertise, experience, industry contacts and knowledge in both areas.
6.1.4 Firm contracts for supply and sales.
 Replay Management's industry contacts will allow us to secure contracts for both
supply of feed stock and sale of finished goods.
6.1.5 Freight is a major cost of operations; proximity to source of supply and markets is
crucial.
 Hauling plastic materials is expensive so entrants will have to consider establishing
facilities close to materials and markets.
 Entrants with existing operations would have to consider new separate facilities in
many cases, reducing economies of scale and making management more difficult.

6.2 NEW TECHNOLOGIES

6.2.1 RPET Flake


The current pricing for virgin resin is 0.65-0.73 per lb. and 0.42-.53 for RPET flake. The
new spread between the two has traditionally been maintained at approximately $0.20 per lb.
Technological changing has ascertain great return.

6.2.2PET Film & Sheet


The reported market demand (to replace virgin PS, PVC and PET) if RPET was available
is estimated at 1 billion Current pricing for RPET sheet is 0.70-0.79 per lb. This technology
for Bottle reshaping and designing have been adopted by different international company.

6.2.3RPET Strapping
The total reported domestic plastic strapping market is 240 million . Of this market, industry
usage of virgin polypropylene is 132 million and of PET is 108 million . Strapping
technology have been advanced
7.0 FINANCIAL PLANS

7.1 SOURCES OF FUNDS


o Stakeholder
o Shareholders
o Investors
o Money Market
o Financial Institutions
7.2 PERFORMA INCOME STATEMENT
Income Statement
Revenue:
Gross Sales 0.00
Sales Returns and
Less: Allowances 0.00
Net Sales 0.00

Cost of Goods Sold:


Beginning Inventory 0.00
Add: Purchases 0.00
Freight-in 0.00
Direct Labor 0.00
Indirect Expenses 0.00
0.00
Less: Ending Inventory 0.00
Cost of Goods Sold 0.00

Gross Profit (Loss) 0.00

Expenses:
Advertising 0.00
Amortization 0.00
Bad Debts 0.00
Bank Charges 0.00
Charitable Contributions 0.00
Commissions 0.00
Contract Labor 0.00
Credit Card Fees 0.00
Delivery Expenses 0.00
Depreciation 0.00
Dues and Subscriptions 0.00
Insurance 0.00
Interest 0.00
Maintenance 0.00
Miscellaneous 0.00
Office Expenses 0.00
Operating Supplies 0.00
Payroll Taxes 0.00
Permits and Licenses 0.00
Postage 0.00
Professional Fees 0.00
Property Taxes 0.00
Rent 0.00
Repairs 0.00
Telephone 0.00
Travel 0.00
Utilities 0.00
Vehicle Expenses 0.00
Wages 0.00
Total Expenses 0.00

Net Operating Income 0.00

Other Income:
Gain (Loss) on Sale of Assets 0.00
Interest Income 0.00
Total Other Income 0.00

Net Income (Loss) 0.00

7.3 PERFORMA BALANCE SHEET


Balance Sheet
Current Assets:
Cash 0.00
Accounts Receivable 0.00
Less: Reserve for Bad Debts 0.00 0.00
Merchandise Inventory 0.00
Prepaid Expenses 0.00
Notes Receivable 0.00
Total Current Assets 0.00

Fixed Assets:
Vehicles 0.00
Less: Accumulated Depreciation 0.00 0.00

Furniture and Fixtures 0.00


Less: Accumulated Depreciation 0.00 0.00

Equipment 0.00
Less: Accumulated Depreciation 0.00 0.00

Buildings 0.00
Less: Accumulated Depreciation 0.00 0.00

Land 0.00
Total Fixed Assets 0.00
Other Assets:
Goodwill 0.00
Total Other Assets 0.00

Total Assets 0.00

Liabilities and Capital

Current Liabilities:
Accounts Payable 0.00
Sales Taxes Payable 0.00
Payroll Taxes Payable 0.00
Accrued Wages Payable 0.00
Unearned Revenues 0.00
Short-Term Notes Payable 0.00
Short-Term Bank Loan Payable 0.00
Total Current Liabilities 0.00

Long-Term Liabilities:
Long-Term Notes Payable 0.00
Mortgage Payable 0.00
Total Long-Term Liabilities 0.00

Total Liabilities 0.00

Capital:
Owner's Equity 0.00
Net Profit 0.00
Total Capital 0.00

Total Liabilities and Capital 0.00

7.4 CASH FLOW PROJECTIONS

Cash Flow Budget Worksheet

[Month] Total
Beginning Cash Balance
Cash Inflows (Income):
Accts. Rec. Collections 0.00
Loan Proceeds 0.00
Sales & Receipts 0.00
Other:
0.00
0.00
Total Cash Inflows 0.00 0.00
Available Cash Balance 0.00
Cash Outflows (Expenses):
Advertising 0.00
Bank Service Charges 0.00
Credit Card Fees 0.00
Delivery 0.00
Health Insurance 0
Insurance 0
Interest 0
Inventory Purchases 0
Miscellaneous 0
Office 0
Payroll 0
Payroll Taxes 0
Professional Fees 0
Rent or Lease 0
Subscriptions & Dues 0
Supplies 0
Taxes & Licenses 0
Utilities & Telephone 0
Other:
Subtotal 0.00 0.00
Other Cash Out Flows:
Capital Purchases 0.00
Loan Principal 0.00
Owner's Draw 0.00
Other:
0.00
Subtotal 0.00 0.00
Total Cash Outflows 0.00 0.00
Ending Cash Balance 0.00

8.0 APPENDIX
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Business. Upstart, 1998.

Belkin, Lisa. "The Art of Making a Plan and Making It Happen." New York Times. December
18, 2000.

Covello, Joseph A., and Brian J. Hazelgren. The Complete Book of Business Plans.
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"How to Write a Great Business Plan." Harvard Business Review. July-August 1997.

Jones, Rebecca. "Business Plans: Roadmaps for Growth and Success." Information Outlook.
December 2000.

Kravitt, Gregory I. Creating a Winning Business Plan. Probus, 1993.

Massarella, Gregory J. et al. How to Prepare a Results-Driven Business Plan. Amacom,


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Pinson, Linda. Anatomy of a Business Plan. 2d ed. Enterprise Dearborn, 1993.

"Your Business Plan." Phoenix Business Journal. September 29, 2000