DEMAND AND SUPPLY DYNAMICS
MEDICAL SHOP
PAAN SHOP
VARIETY: Flavour Paan Special Traditional
Indian Flavour Paan, Silver Coating Pan and
Traditional Pan.
MOUTH FRESHENER: Spray mint, Listerine
OTHER PRODUCT: Toffees to biscuits,
snacks, confectionery, beverages, mosquito
coils, incense sticks, shampoo sachets and even
hair oils
Purchases
Pan Shop
Organized purchases – Some of the products are
bought from a specific dealer or wholesaler e.g.,
soft drinks, biscuit, chips.
Unorganized purchases – No. of things in paan
shop are bought locally not from a specific shop
e.g., paan leaf (betel leaf and other ingredients in
paan.
Needles/Syringes — All types and varieties
Sharps disposal containers.
Nursing Aids — Dressing aids, restraints, anti-
embolism stockings, diapers.
Obstetrician/gynecologist — umbilical
catheters, speculums, maternity briefs/pads,
umbilical clamps.
Operation room and other items — surgical
packs, table covers, surgical instruments,
towels.
Medical Shop
Organized purchases – All the medicines are
bought from a licensed drug wholesaler as fake
medicines in India are a big problem.
Unorganized Purchases – it is mainly avoided as
many counterfeits are lured towards creating
duplicate medicines, causing a threat to human
lives.
 TAXES AND LICENSING
In addition to protecting your business legally, licenses can boost credibility and permit you to
use for citywide funding. Moreover, if our business has staff or sells taxable products or services,
we also need to register with the taxing authorities.

MEDICAL SHOP:
PAAN SHOP: 1. Drug license in India.
2. Business Registration.
1. Business Registration.
3. Trademark registration.
2. FSSAI Registration / FSSAI
4. FSSAI Registration / FSSAI License.
License.
5. Shop & Establishment License
3. GST Registration.
Certificate.
4. Gumasta license.
6. GST Registration.
7. Factory Act License.

Factor of production
Factors of production, term employed by economists to denote the economic resources, both
human and other, which, if properly utilized, will cause a flow or output of products
and services.

 Land
It is the first and natural factor of production. The
• Land
land which they have chosen is commercial land. It is
They own a commercial land. The shop is situated
located in MP nagar. The property is taken of lease.
In Lal Ghati area. It is a owner’s property.
• In-House Labor
• Labor
There are around 3 -4 workers for conducting
There are 2-3 workers for help. They are skilled
operations. They are semi-skilled labor.
labors.
• Capital
• Capital
capital refers to all or any manmade resources utilized in the
Cabinets for storing drugs, refrigerator for storing
production process. They possess furniture, machinery, sensitive drugs and computer for accounting.
tools, equipment and raw material.
 Substitution Effect

Paan Shop Medical Shop

Pan an Indian after-dinner treat mainly don’t
have a substitute product but if in case pan gets
costlier people consumes readymade pan masala
e.g., Pass-Pass, Mastana, rajanigandha,
Substitute for medicines include various healing
systems, such as homeopathy, herbal remedies,
naturopathy, chiropractic, acupuncture. E.g.,
Patanjali’s herbal products and Online
Platforms like Pharmeasy.com and 1mg.com.

NATURE OF COMPETITION

PAAN SHOP: MEDICAL SHOP:

MONOPOLISTIC COMPETITION
Monopolistic competition occurs when an industry
has many firms offering products that are similar
but not identical. Firms in monopolistic
competition typically attempt to differentiate their
products so as to realize above market returns.
After surveying we witnessed that there were 2-3
paan shops in the same colony.
But there were different variety of paans in each
shop. Sometimes name varies and sometimes taste
and packaging also.
Hence, paan shop is monopolistic in nature of
competition
OLIGOPOLY COMPETITION
A competitive situation during which there are only a
couple of sellers (of products which will be
differentiated but to not any great extent); each
seller features a high percentage of the market and
can't afford to ignore the actions of the others.
After surveying we witnessed that there was 1-2 shop
in a colony because it needs proper certification and
entry and exit is also restricted.
There were almost same medicines, injections, And
other stated items in every shop. No different varieties
or tastes or preferences are present in medical stores.
Hence, medical store is oligopolistic in nature of
competition.

COST OF PRODUCTION
Paan shop
Medical shop
1) Setup cost
1) Setup cost
(a) Franchise cost –
a) Shop price -Rs2,50,000 (Y1953)
Rs5,00,000.
b) Furniture – Rs 50,000
c) Refrigerator -Rs25,000
(b)Capital invested
2) Salary -Rs 15000
Rs15,00,000-20,00,000.
3) Electricity – Rs 5000-6000
1) Salary to employees
Rs10, 000-15,000 4) Stocks -Rs 70,000
2) Rent 5) profit margin -15-25%
Rs 10,000
6) Annual profit-Rs22,50,000 approx
3) Electricity – Rs 4000-5000
4) Raw material - Rs25000-30,000
5) Annual Income -Rs18,00,000

MARKET STRUCTURE/OPPORTUNITIES
PAAN SHOP

 Political -Government supports tobacco & nicotine free products.

 Economic - Supportive pricing strategy.
-Disposable Income not affected.
 Social - Reviving the tradition of mouth freshener with health benefits
- Instead of deforesting we are helping nature.
 Technological- Setup of Cancer Institution.
-R 7 D on climate and soil.
 Environmental -Operations on Biogas & solar energy.
-Rainwater Harvesting
 Legal - Employment of laborers as per Indian Labor.
 Customer Analysis-
SEGMENTATION & TARGETING-
Paan Masala & Gutkha Regular paan eaters Occasional paan eaters Non-paan eaters

POSITIONING-
100% tobacco free & nicotine free Benefits from organically grown Betel leaves.

MEDICAL SHOP-
SWOT Analysis: -

STRENGTHS-
WEAKNESSES-
 High skilled employees
 Gained reputation within the community  Selling price of some medical products
due to its services, and quality of are beyond general living standard.
products.  Low financial positions, stops the
 Working experience creates business updating & installing newest
improvement in running the business technology.
smoothly.

THREATS-
OPPORTUNITIES-
 Retailing medical products is a sensitive
 Market of relating medical products area of business, closely refers to human
grows strong and stable. health and regulation.
 Central location of pharmacy is  Increase in competition due to special
surrounded by the community with large interest of health-care services.
population of patients.  Import expenses will rise sharply in years
as well as operating cost.
 Break Even

The Break-even point is the point at which total revenues is equal to total costs or
expenses. A condition of no profit and no loss.
-Paan Shop
As per our research we found that the pan shop owner does not had any knowledge
related to break-even point.

-Medical Shop
As per our research we found that the medical shop owner had the knowledge of break-
even point and they told us that initial their fixed cost was more than total revenue due to
which they were suffering loss but after 2 month there total cost was equal to total
revenue where they had attained the break-even point, after that point of time their
revenue is always more than of their cost (state of profit).
 SCALE ECONOMY
Paan Shop
1. Bulk Buying: Purchasing raw materials and
stock in bulk will lower the total average
cost.
Example: Purchasing 10 packets of cigarette
cost will be Rs.80 per packet, and purchasing
50 packets in bulk cost will be Rs.77 per
packet.
2. External Factors: During this Pandemic the
consumer is turned more conscious about
health and wellness, does it will affect the
sales.
Profit Maximization
Paan Shop
1. Reducing Cost: If they are purchasing raw
material and stock in lower cost, they can
reduce the price this will indirectly increase
the profit.
2. Reducing Direct Labour: If the cost
payable to direct labour is reduced with
same production level without any
additional overtime it will show increase in
profit.
3. Taxes Payable: Strategies like Income
Timing and Income Shifting can reduce tax
burden in current reporting period but will
increase burden in long run.
Medical Store
1. Bulk Buying: Purchasing medicines and
supplements from whole sale market Dawa
Bazaar, in lower total average cost.
Example: Buying 10 units of cough syrup 1
unit will cost Rs.56 and buying in bulk like
50 units will cost Rs.53 per unit.
2. External Factors: During this pandemic the
pharmaceutical industry is growing, it will
also benefit the store.
Medical Store
1. Reducing Cost: If they are purchasing
medicines and supplements in lower cost
they can reduce the price this will
indirectly increase the profit.
2. Reducing Direct: If the cost payable to
direct labour or store attendant is reduced
with same production level without any
additional overtime it will show increase in
profit.
3. Taxes Payable: Strategies like Income
Timing and Income Shifting can reduce tax
burden in current reporting period but will
increase burden in long run.