BUSINESS PLAN

“WASTE MAGIC”

PREPARED FOR:
Shabnin Rahman Shorna (SRS2)
Lecturer, Department of Management
School of Business and Economics, North South University
PREPARED BY:
Group 5

Members:
Jahid Hasan Joy- 1711121030
Jyoti Biswas-1711144030
Md. Adnan Abir-1711358030
Ashraf Muhammad Sakib- 1712047030
Md Robiul Islam Sojib- 1721276030

Date of Submission: April 25, 2020

 Acknowledgment
We would like to start by thanking Almighty Allah for giving us such opportunity and strength to
complete the entire business plan on time. Then we are very grateful to our esteemed mentor,
Shabnin Rahman Shorna madam, who gave us a great opportunity to do this project that
helped us learn different things and gain experience on Entrepreneurship. We would like to thank
her for the guidance that she gave us while making the project. Thanks also for the advice and
encouragement that helped us finish the project. Her blessings and advices will help us go a long
way in the future.

We do want to extend our heartfelt appreciation to all the team members. They all contributed
equally to finish the project and to ensure that they worked very hard to confirm the project
success. Their hard work and commitment have made this project flawless. Last but not least, we
would like to thank all the people who supported us with adequate details, which helped us a lot
to boost our trust and encouraged us to evaluate our business plan from various angles.
Letter of Transmittal
April 25, 2020
Shabnin Rahman Shorna
Lecturer, Department of Management
North South University

Subject: Submission of Business Plan of Waste Magic

Dear Ma’am,
We humbly present our business plan on "Waste Magic" to you. We found this project both very
challenging and fascinating. This project has helped us get used to a lot of learning about the
concepts and ideas that we've explored in Entrepreneurship.

We express our gratitude for allowing us to work on this project. This project has helped us gain
new entrepreneurial skills. In all sincerity we hope you find this report useful and adequately
detailed. Having given all the details, if there are any further queries, we will be happy to
response them.

Regards,

Jahid Hasan Joy- 1711121030

Jyoti Biswas-1711144030

Md. Adnan Abir-1711358030

Ashraf Muhammad Sakib- 1712047030

Md Robiul Islam Sojib- 1721276030

 Executive Summary
The following report is a comprehensive business plan about WASTE MAGIC. The core
product of this business is biodegradable one-time utensils which are very eco-friendly and
inexpensive as well in terms of the current market offerings such as plastic and paper utensils. As
people are getting more environmentally cautious by the day and the trend of eating in
restaurants has increased over the past decade, the product has achieved to strike a market gap as
restaurants and people in general now use disposable utensils however, are not eco-friendly thus
leading to plastic pollution as so on. The business plan provides a detailed overview about the
nature firm, the firms mission and vision, the size of the venture, the main people who are behind
the management of the business and their background. Moving on, it talks about the business
model of the firm and the business model canvas. It contains the micro and macro environmental
analysis like PESTEL. Porter’s five forces, the Stakeholders analysis and SWOT, that were used
to evaluate the feasibility of the product and business in terms of the industry. Moving on, the
report provides a detailed description on the production plans of the business which contains the
process of manufacturing and the raw materials needed to produce the biodegradable disposable
utensils. the plan also contains thorough marketing plan which talks about the target market of
the business, the pricing strategies, the promotional strategies, the packaging, the positioning of
the business and so on which will be executed to ensure a strong establishment of the business.
Furthermore, the report contains an operational plan which provides a detailed description of the
firms supply chain and other operational characteristics like logistics. Moreover, the plan
contains an elaborate organizational plan that provides complete information about the form of
ownership of the business and the identification and involvement of the partners and their roles
and responsibilities. It also provides a risk management plan which includes information
regarding the risks that are associated with the business and various contingency plans that can
be used to avoid or reduce the associated risk and finally, the plan contains a comprehensive
financial plan that includes forecasted income statement and balance sheets regarding the
business and the cashflow projections of the business. The financial plan further talks about the
source of the funds that will be used by the business, the payback period and provides ratio
analysis with industry benchmarks in order to evaluate the financial feasibility of the business.
Table of Contents
Acknowledgment............................................................................................................................i
Letter of Transmittal.....................................................................................................................ii
Executive Summary.....................................................................................................................iii
1.0 Introduction:............................................................................................................................1
1.1 Name and address of the business:.....................................................................................1
1.2 Name(s) and address(s) of the principal(s):.......................................................................1
1.3 Nature of the business:........................................................................................................1
1.4 Confidentially Financial Needed:.......................................................................................2
1.5 Statement of Confidentiality of Report:............................................................................2
2.0 BUSINESS MODEL................................................................................................................3
2.1 Business Canvas Model:......................................................................................................3
2.2 Pricing Model:......................................................................................................................3
2.3 Social Goal:...........................................................................................................................3
2.4 Sustainability:......................................................................................................................4
2.5 Eco-friendly:.........................................................................................................................4
2.6 Ethical:..................................................................................................................................4
3.0 Business Environment Analysis..............................................................................................4
3.1 Future outlook and trends..................................................................................................4
3.2 PESTEL Analysis.................................................................................................................6
3.2.1 Political..........................................................................................................................6
3.2.2 Legal...............................................................................................................................6
3.2.3 Economical....................................................................................................................7
3.2.4 Social..............................................................................................................................7
3.2.5 Technological.................................................................................................................8
3.2.6 Environmental...............................................................................................................8
3.3 Porter’s five forces:..............................................................................................................8
3.3.1 Bargaining Power of Buyers:.......................................................................................8
3.3.2 Bargaining Power of Suppliers....................................................................................9
3.3.3 Threat of New Entrants:..............................................................................................9
3.3.4 Threat of Substitutes..................................................................................................10
3.3.5 Rivalry Among Existing Companies.........................................................................10
 3.4 SWOT Analysis..................................................................................................................11
3.4.1 Strengths......................................................................................................................11
3.4.2 Weaknesses..................................................................................................................11
3.4.3 Opportunities..............................................................................................................11
3.4.4 Threats.........................................................................................................................11
3.5 Stakeholder Analysis:........................................................................................................12
4.0 Description of the venture:...................................................................................................13
4.1 Mission:...............................................................................................................................13
4.2 Vision:.................................................................................................................................14
4.3 Product:..............................................................................................................................14
4.4 Size of the business:...........................................................................................................14
4.5 Office Equipment and Personnel:....................................................................................15
4.6 Background of Entrepreneurs:........................................................................................15
5.0 Production Plan.....................................................................................................................18
5.1 Manufacturing Process:....................................................................................................18
5.2 Production Process: Machineries needed in each Step..................................................20
5.3 Names of Suppliers of Raw Materials:............................................................................22
6.0 Operational Plan....................................................................................................................22
6.1 Description of company’s operation................................................................................22
6.2 Flow of order of goods.......................................................................................................23
6.3 Business location and requirements:...............................................................................23
6.4 Transportation:..................................................................................................................23
7.0 Marketing Plan:.....................................................................................................................23
7Ps.............................................................................................................................................26
7.1 Product:..............................................................................................................................26
7.2 Price:...................................................................................................................................26
7.3 Promotion:..........................................................................................................................26
7.4 Place:...................................................................................................................................27
7.5 Packaging:..........................................................................................................................28
7.6 Positioning:.........................................................................................................................28
7.7 People:.................................................................................................................................28
8.0 Organizational Plan:.............................................................................................................29
 8.1 Form of ownership:...........................................................................................................29
8.2 Identification of Partners:.................................................................................................29
8.3 Background Information of Management Team............................................................29
8.4 Authority of Principles......................................................................................................30
8.5 Roles and Responsibilities:................................................................................................30
9.0 Risk Management Plan.........................................................................................................32
9.1 Weakness(es)/Risk Associated with the Business............................................................32
9.2 Contingency & Mitigation Plan........................................................................................33
10.0 Financial Plan.......................................................................................................................34
10.1 Assumptions:....................................................................................................................34
10.1.1 Cost Assumptions:....................................................................................................34
10.1.2 Revenue Assumption for the first year:..................................................................36
10.1.3 Assumption for Pro-forma Income Statement, Balance Sheet and Cash flow
projections:...........................................................................................................................36
10.2 Capital Budgeting:...........................................................................................................36
10.3 Pro forma Income Statement:........................................................................................37
10.4 Pro forma Balance Sheet:...............................................................................................37
10.5 Cash flow projections:.....................................................................................................38
10.6 Breakdowns......................................................................................................................38
10.6.1 Base year’s income statement..................................................................................39
10.6.2 Base year’s cash flow statement..............................................................................39
10.7 Breakeven analysis...........................................................................................................40
10.8 Payback period.................................................................................................................41
10.9 Source of Funds................................................................................................................41
10.10 Ratio Analysis.................................................................................................................42
10.10.1 Liquidity Ratio:.......................................................................................................42
10.10.2 Activity Ratios:........................................................................................................43
10.10.3 Leverage Ratio:.......................................................................................................43
10.10.4 Profitability Ratio:..................................................................................................44
11.0 Conclusion:...........................................................................................................................45
12.0 References.............................................................................................................................46
Appendix.......................................................................................................................................48
1.0 Introduction:
1.1 Name and address of the business:
The name of our business is WASTE MAGIC. As the core product of our business is disposable
cups and plates which are manufactured from agricultural waste named rice husk. For that we
think that the name of our business goes with our core product. For producing the products, we
have built a factory and a warehouse. The location of our factory and warehouse would be at
Gazipur and we have set up our office at Bashundhara R/A where we are doing the
administrative operations.

1.2 Name(s) and address(s) of the principal(s):

Name Designation Address

1. Ashraf Muhammad Chief Executive Officer (CEO) Mirpur DOHS, Dhaka

Sakib
2. Jahid Hasan Joy Chief Human Resource Officer Mirpur DOHS, Dhaka
(CHRO)
3. Md Adnan Abir Chief Financial Officer (CFO) Dhanmondi, Dhaka

4. Jyoti Biswas Chief Marketing Officer (CMO) Lalbagh, Dhaka

5. Robiul Islam Sojib Chief Operating Officer (COO) Bashundhara, Dhaka

1.3 Nature of the business:

Waste Magic is the venture which is operating by five business partners. Our main goal is to
produce biodegradable disposable cups/plates by converting agricultural waste named rice husk
through using of suitable machineries. But now disposable cup/plate manufacturer companies are
started to manufacture paper cup/plate because plastic cups/plates create negative impact on the
environment. But the process of manufacturing paper cups/plates is not good enough for
environment though it is recyclable. The reason is that huge amount of wood and clean water is
needed to produce paper cups/plates which are not good for the environment (Bonanos, 2013). It
reduces the natural resources. Those are the reasons why we, Waste Magic, come up with this
idea where we are using rice husk as the main raw material to manufacture disposable cups/plate.

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1.4 Confidentially Financial Needed:
To start operation of our venture, WASTE MAGIC has required BDT 15,000,000. However, the
5 founding partners can make investment of BDT 10,000,000 by financing equally. The rest
amount which is about BDT 5,000,000 that we have managed from the angel investor by selling
the 20% share of our venture in helping WASTE MAGIC to reach its social objectives. As, this
venture is running in form of partnership and depending on their investment. Therefore, the gains
and losses will be divided among the participants according to percentage of ownership of the
venture.

1.5 Statement of Confidentiality of Report:

The reader agrees by signing this document that he / she will maintain the confidentiality of
information contained in the business plan of Waste Magic. The reader agrees not to reveal
details without the express consent of the company owners and, according to the relevant laws of
the People's Republic of Bangladesh, prevent prosecution for any misdemeanor.

Applicable Law:

Section 73 of the Contract Act, 1872 and The Partnership Act, 1932 shall preside over this
contract.

Ashraf Muhammad Sakib ____________________________

Jahid Hasan Joy ____________________________

Md Adnan Abir ____________________________

Jyoti Biswas ____________________________

Robiul Islam Sojib ____________________________

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2.0 BUSINESS MODEL
2.1 Business Canvas Model:

2.2 Pricing Model:

The industry is already dominated by plastic and paper cups/plates. That’s why we are going to
follow “penetration pricing strategy” to enter into the market. Because we think cheaper price
would make it easier for prospective buyers to buy and eventually get accustomed to the goods.

2.3 Social Goal:

Due to extensive use and easy availability, we are using plastic in our day to day life.
Unfortunately, though, the biggest source of environmental destruction is plastic waste. About
4.8 to 12.7 million tons of plastic waste are throwing into the seas worldwide (National History
Museum , 2015). The marine world is being ruined. The usage of plastics has created numerous
issues for the safety of people. As the people of Bangladesh are becoming educated, people will

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be concerned about the harmful implications of plastic and they are now looking for a
sustainable replacement. For that goods of Waste Magic will be socially appropriate if our
marketing strategy hit our target consumers.

2.4 Sustainability:
Sustainable development Goal 12 (sustainable growth and use patterns) and Goal 14 for
sustainable development (protection of life under water) are linked to the elimination in plastic
use. This is connected to the sustainable development target. SDG 12 defines that in the future
plastics are not sustainable in terms of development and use. Therefore, in the future, our goods
should be renewable. The goal of SDG 14 is to avoid specific pollutants in the ocean
environment (United Nations , 2020). Therefore, Waste Magic’s goods would also lead to reduce
emissions and preserving a healthy environment. Our products can also be safe as these are
produced from rice husk and it is biodegradable and the goods are most importantly affordable.

2.5 Eco-friendly:
The ecological environment in Bangladesh is highly affected by plastic waste. Today the world
is suffering from "throwaway mentality." Since plastic is non-biodegradable, it impacts the
atmosphere badly. Only sustainable products should create positive impact against this
"throwaway mentality”. This series include biodegradable goods. Therefore, the value of the
cycle of combustion will be decreased and the amount of carbon dioxide and other greenhouse
gas as the byproduct of the plastic will be minimized. Finally, the move from plastics to
decomposable products is going to reduce the greenhouse impact in Bangladesh directly.

2.6 Ethical:
Investor from different perspectives will be encouraged to make the most of their impact.
Because we are operating our business ethically by ensuing all rules and regulations. Besides,
our product and financial stability is about creating the best solution of plastic usage and
encourage to use agricultural waste material in a sustainable way.

3.0 Business Environment Analysis

3.1 Future outlook and trends
Bangladesh’s use of disposable cups and plates have increased tremendously in the past few
years. Due to economic growth, better living standards and as people are now able, they prefer

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on eating outside more and more as a form of recreation, furthermore they also prefer eating on-
the-go due to their hectic day-to-day schedules. As a result of which the usage of the onetime
utensils has increased in the universities, restaurants, coffee joints, tea stands, in the corporate
world and even these utensils are now-a-days used domestically to save time. Which has all
resulted in the flourishing development in the industry for disposable utensils of Bangladesh.
From analysis and insights of the industry it has come to knowledge that in Bangladesh, there is
a yearly demand of 120 million disposable cups of which, a major amount is satisfied by plastic
cups which are mostly imported from our neighboring country India (Dhaka Tribune, 2017). In
comparison to the market share of paper cups which is around Tk. 35 crore per year, the market
share of plastic cups is around Tk. 240 crore according to Dhaka Tribune (Dhaka Tribune, 2017).
The reason of which is first of all, due to the lack of awareness of environmental hazards of the
plastic cups and the availability of paper cups. Moreover, high amount of tax charges on the
imported raw materials used in producing paper cups which is about 53% which makes the
production and usage of paper cups more costly whereas importing plastic utensils from India is
very cheap (Ovi, 2017).

Compared to the cheaper plastic substitute, paper cups are more eco-friendly and less hazardous
to health. Having said that, plastic is still mostly used due to its lower cost. Although plastic is
still a cheaper and more available in terms of paper utensils, it has its certain drawbacks, plastic
is non-biodegradable resulting in plastic pollution such as: littered waste plastic is a major clause
of many uprising environmental issues like floods, plastic mixed in the water bodies leading to
the deaths of many animals like whales, sharks and so on damaging the ecosystem. Furthermore,
the incineration of plastic waste results in massive emissions of carbon dioxide and other harmful
greenhouse gases which play a major role in the increased global warming and climate changes.

With plastic pollution becoming a matter of great concern for everyone worldwide, more and
more corporations and customers are standing against plastic pollution and seeking an eco-
friendlier alternative which is sustainable i.e. refusing the use and consumption of plastic and
opting for more bio-degradable substitutes, adding to that, the governments across the globe are
also taking initiatives to restrain the use and consumption of plastic leading to an increased
global demand for bio-degradable and eco-friendly substitutes of plastic such as paper cups
instead of plastic cups.

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Having said that, in Bangladesh, due to the higher cost of paper cups plastic utensils still prevail
regardless of the environmental hazard of plastic. However, the customers and corporations are
also becoming more cautious of the environmental issues caused by the use of plastic and they
are too looking for more eco-friendly alternatives. Because the disposable utensils industry is
still dominated by plastic utensils and the cost for paper utensils are still very high, there lies a
market gap in the industry; an untapped market of an eco-friendlier, bio-degradable and cost-
efficient alternative of disposable products. A market demand that is yet not fulfilled by the local
manufacturers. The demand is not just bounded locally, there is worldwide demand for such eco-
friendly, efficient and effective alternatives of disposable utensils as the global market of paper
cups is around $280 billion annually according to The daily Star and is said to be increasing
rapidly which also provides the future potential of exporting of such alternatives globally
(Parvez, Paper cup: the business of protecting environment, 2017).

3.2 PESTEL Analysis

3.2.1 Political
 Political stability: with one party ruling continuously for the last 10 years, the country is
politically quite stable as the instability factors such as movements, hartals, resistance is
highly unlikely sustaining the demand of the product among the customers and clients.
 Encouragement of the Government on new innovations: various policies have been
adopted by the government in facilitating startups which are new and innovative, with taking
on policies like the A2I initiative and so on.
 Difficulties of setting up businesses: starting a new business venture specially those which
include manufacturing requires a lot of bureaucratic work along with various permissions by
several government bodies before setting up a production facility.
3.2.2 Legal
 The Environment Conservation Act, 1995: the section 6A of the act contains regulations
concerning the "restrictions on manufacture and sale of articles injurious to environment"; the act
was undertaken to refrain industries from polluting the environment through their industrial wastages.
 High tax charges on imported paper: paper which is the core component of producing
paper cups have an import tariff of 53% which is quite expensive and leads to more costly
paper cups compared to the cheaper imported plastic cups. However, instead of importing

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 raw materials at such expense, if a business can figure out a way of cultivating raw materials
domestically, it would provide them a competitive advantage and will help avoid the burden
of import tariffs.
 Foreign Trade Policies: various policies have been undertaken to help diversify trade for
industries which have future potential growth. One such policy is the EBA program
(Everything but Arms) that’s facilitates countries like Bangladesh access to the EU
(European Union) making it effortless to export products.
3.2.3 Economical
 Economic growth of Bangladesh: over the past decade Bangladesh has seen rapid economic
growth. The GDP of Bangladesh has been robust measuring at around 7.9% growth in 2018
and is expected to grow.
 Higher Disposable Income: as the economy of Bangladesh grows; it indicates a higher per
capita income of the nation which eventually results in increased disposable income i.e. as
people have more money to spend, they are more likely to eat outside elevating the demand
of the disposable utensils.
 Exchange Rate Stability: as the economy is growing day-by-day, the value of the currency
is appreciating against other major currencies such as Dollar, Euros etc. and even if not
appreciating, the economic growth helps in keeping the currency more stable and helps in
avoiding exchange rate risks.
3.2.4 Social
 Increased Population Growth: the population of Bangladesh has been increasing by the day
furthermore, many people are now migrating to the urban areas leaving the rural areas due to
new found economic solvency which broadens the customer market for any sort of business.
 Change in The Conventional Mindset: although in the past few decades, the people of
Bangladesh were not concerned about the environment however, along with time people
have become more cautious about the environment and they advocate against products that
are hazardous for the environment and encourage in using eco-friendly products.
 Health consciousness: more and more people are becoming health cautious day by day due
to which people are now more aware of the products they use and whether the products are
safe of hazardous for their health.

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 The Mindset of Recreational Activity: in Bangladesh, when people think about recreation,
the first thing that comes to their mind is going out to eat. Therefore, as there is an increase in
demand for the restaurant industry, there will be demand for related supplied that are needed
by the restaurant industry i.e. disposable utensils.
3.2.5 Technological
 Modern Technological Advancements: the recent technological advancements and
developments of advanced machinery and equipment’s have made it easier to recycle wasted
raw materials like rice husks into bio-degradable disposable utensils and what not.
 A Digital Bangladesh: as Bangladesh is now emphasizing more on technology with a
perception of a “Digital Bangladesh”. the people of Bangladesh now possess the
technological know how’s and skill. They are more familiar with the internet and use smart
gadgets in their regular lives. Which makes it easier for business to reach them out. And also
require less investment on awareness of businesses.
3.2.6 Environmental
 Natural disasters: even though natural disasters like storms, cyclones, floods etc. are not
major factors that affect a business on a regular basis however, it is one of the external
environmental factors that might affect a business directly specially, in businesses that
require raw materials to produce their products such as the use of rice husk for producing
eco-friendly disposable utensils.
 Abundance of Raw Materials: as Bangladesh is one of the top most country in terms of rice
producing, it refers that there is an abundance of rice husks which is wasted given that it is a
by-product. This wasted and widely available by-product can be used and recycled to
produce paper cups that can aid in lessening plastic pollution.
3.3 Porter’s five forces:
3.3.1 Bargaining Power of Buyers:
According to the current trends and situations the bargaining power of customers are QUITE
HIGH due to:

 Availability of alternatives: as the demand of the current market is already satisfied by

paper and plastic cups whereas plastic is a cheaper alternative, the buyers have a stronger
bargaining power as they can easily shift to the other alternatives.

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 Lower switching cost: as the customer for the product can easily switch to other alternatives
like plastic cups and paper cups as the cost of switching from one product to another is quite
negligible, due to which the customers have a higher bargaining power.
 Limited customer: as majority of our target market still use plastic and paper cups, and yet
only a few customers of our target segment as turning towards more eco-friendly solutions
given that the it is increasing gradually, however, initially there will only a handful of
customers which provide them a higher bargaining power which will eventually decrease as
the customer base increases.
3.3.2 Bargaining Power of Suppliers
The bargaining power of the suppliers who will be providing the raw materials necessary is quite
LOW because:

 Higher supplier alternatives: as the core raw material that we need to produce our bio-
degradable disposable utensils is “rice husk”, which is a wasted by-product in our country
that comes from rice and is available in abundance, there are a lot of suppliers who would be
eager to supply the demanded rice husks which will increase their revenue instead of wasting
the by-product.
 Lower supplier switching cost: as there will be a lot of supplier who would offer to sell the
rice husks and the cost of switching a supplier is very low in Bangladesh, specially in such
industries, the bargaining power of suppliers are quite low.
 Lack of differentiated offerings: as the main raw material needed to produce the disposable
utensils is “rice husk” which is widely available and is considered as a waste in our country,
and as there is no room for the suppliers to differentiate their offering of the rice husk, they
have less bargaining power.
3.3.3 Threat of New Entrants:
The threat of a new business entering the market is MEDIUM TO HIGH as:

 Lower entry barriers: lack of government restriction and barriers to enter the industry
makes it easy for other businesses to enter the market without being subject to any barriers of
entry increasing the likelihood to businesses to enter.

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 Industry attractiveness: as the industry for disposable utensils is developing significantly in
our country and is a quite attractive market, it gives rise to the chance of having higher
number of competitors.
 Lower cost of entry: the cost of entering the market i.e. the initial investment needed to
enter the industry in lower compared to other industries that prevail in the country which may
opt others to enter the market and commence business.
 Lack of competitor retaliation: as the industry is still growing in Bangladesh due to which
the existing competitors are not yet strong enough to retaliate a new entry,
 Technology and resources: because the machinery and equipment’s and the raw materials
required to produce the disposable utensils are widely available and are not subject to any
intellectual property right, they can be easily used by other increasing the threat of new
entrants.
3.3.4 Threat of Substitutes
The threat of a new substitute is COMPARATIVELY LOW because:

 Innovation: as customers are now looking for a more eco-friendly and bio-degradable
alternative of plastic utensils, our product is able to satisfy the needs and wants of our target
segments that too at a cheaper cost compared to the existing paper cups, due to our
innovation of converting by-products like rice husk to disposable and bio-degradable cups
and plates. Which reduces the threat of any future substitutes as our product fulfills all the
criteria of our target customers.
3.3.5 Rivalry Among Existing Companies
The rivalry among the existing companies are LOW TO MEDIUM due to:

 High market growth: as the industry for disposable utensils is still growing and not yet
saturated; the existing companies in the industry still have sufficient customer base to target
therefore, reducing competition amongst each other to grab each other’s customers.
However, the high market growth may seem lucrative to several companies and might
increase the competition.
 Cheaper exit barriers: the competitiveness among the rivals are low in such industries
because the companies don’t have to invest heavily in such industries which enables
companies to exit the industry if they are not satisfied with the business.

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 Opportunity for product differentiation: as the demand industry is currently satisfied by
only plastic and expensive paper disposable utensil there still lies a market gap of providing
cheaper bio-degradable disposable utensils which will help our business to differentiate our
offerings and gain competitive advantage against the competition.
3.4 SWOT Analysis
3.4.1 Strengths
 Offering a new and innovative product
 A green bio-degradable solution
 Proper usage of natural by-product wastes
 A sustainable solution
 Low cost of production
 Abundance of resources
 Lower tax charges
3.4.2 Weaknesses
 Lack of experience and skills of the management
 Environmental calamities that might affect the availability of resources
 Lack of information and experience on the industry
 Scarcity of networks for marketing and procurement
3.4.3 Opportunities
 An increase in the demand for one-time disposable utensils in the country
 The substantial growth of the disposable utensils industry
 People are becoming more eco-friendly and want green solutions
 The market gap for bio-degradable one-time utensils
 Govt. incentives on innovative products
 More flexible trade policies encouraging product exporting
 Opportunities to diversify to various industries in the long run
3.4.4 Threats
 Lack of entry barriers and restraining policies from the govt.
 The threat of customers using the more cheaper plastic utensils still prevail

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 Competing against the already established plastic and paper utensil market
 Usage of rice husk as bio-fuel in the rural areas
 Customers mindset of acceptance of eco-friendly products
3.5 Stakeholder Analysis:
 Supplier Analysis: Due to the progress of modern science and technology, the popularity of
waste management concept is increasing and it creates great opportunity for the suppliers to
generate more revenues. If this material is used efficiently, suppliers would be able to sell
millions of tons of rice husk every year.
 Customer Analysis: We realize day by day that paper cups have become pretty common
and effective in wiping out a large portion of disposable plastic cup use. This is happening
due to clients ' knowledge of environmental contamination and health issues arising from it.
Therefore, companies seek to consumers by looking for plastic alternatives. For that we
think there will be good chance that our product will be accepted to our customers as it is
environment friendly and less costly than paper and plastic disposable cups/plates. It would
be the rational fact that is how our customers differentiate us from others.
 Competitor Analysis: Right now, emerging companies are bringing such products which
are mainly environment friendly. Same things happen in the disposable cup/plate industry.
As a result, there are some key companies like Mozir & Company, Ecopack Bangladesh,
KPC Industry, Hello Green Industries, and Eco Technologies Limited are bringing paper
cup in the industry and promoting these products as the greatest alternative product of
plastic disposable cups/plates. Even then, plastic cups/plates also survive in the market as
the cost of plastic cup is comparatively lower than paper cups/plate. Because Manufacturers
of paper cups have to pay an import duty of 53 per cent and it is driving up production costs
(Dhaka Tribune, 2017). Now, we can say that paper disposable cups/plates would be the
best alternative product of plastic products but these are not cost effective at all because of
higher import duty which is imposed by government.
Here, our single-use cups and plates will be made from the fibers extracted from waste
materials called rice husks, we do not have to pay the paper import tax as our competitors
do. In Bangladesh about 9 million tons of rice husks are produced each year (Md. Rabiul
Islam, 2012).

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 Investor Analysis: Investors are interested in creative projects that make clever use of
technology or resourceful environmental conservation initiatives. In the same way, we are
using waste materials to make our final products which helps to reduce a major
environmental issue called plastic pollution. Our goal is to attract investors who are excited
to invest in a product that is environmentally friendly.
 Environmentally Concerned Groups Analysis: Currently, business policy is going
towards technological innovations and sustainable practices which raise environmental
awareness in the world. Big environmental problems such as climate change and threats to
aquatic animals are largely linked to numerous business malpractices. Every year 8 million
tons of plastic end up in oceans worldwide (World Environment Day, 2020). Therefore, it is
high time that everyone should be concern about environment pollution. As our
manufactured products are from agricultural waste materials and for that we are going to
save a lot of resources by not chopping down trees to produce paper or using coal, natural
gas, palm oil, etc. to make plastic. Hence putting forward our company would attract these
environmentally concerned groups.
 Government Analysis: A business can be influenced through different government
policies. For an example, Government of Bangladesh imposed 53% import duty on paper
and it has increased the production cost of disposable paper cups/plates (Ovi, 2017).
Therefore, it is quite difficult for them to compete with the manufacturer companies of
plastic cups/plates. But we are not facing this problem as the raw material of our product is
rice husk which is the agricultural waste and currently government is motivating people to
use it as a source of renewable energy. For an example, A power plant was already
constructed in Gazipur and based on rice husks as the source of energy (Parvez, Rice-husk
power plant in the offing, 2009).

4.0 Description of the venture:

4.1 Mission:
Waste magic is a new organization that is producing biodegradable cups and plates. Organic
cups and plates are manufactured from agricultural waste named rice husk. These biodegradable
cups and plates will be replaced by non-degradable plastics which will be helpful for

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constructing healthy surroundings. Therefore, the mission of our business is to minimize the
plastic contamination and strengthen the practice of disposable products.

4.2 Vision:
The vision of Waste Magic is to create a sustainable world for current and future generation. The
use of biodegradable product will help us to build a healthy environment.

4.3 Product:
Our core product is disposable cups/plates which is made from rice husk and these products is a
substitute product of plastic. Our main purpose of manufacturing these products is to reduce
plastic pollution. Besides, the raw materials are readily available in our country. Therefore, we
can easily satisfy consumer demand and deliver the product at a lower cost. It would make sure
customers are less likely to oppose this radical move forward because of a price issue. In fact, the
world is currently engaged in 17 Sustainable Development Goals (SDGs), investors would be
particularly involved in investing as it is a sustainable business model.

4.4 Size of the business:

The size of the business of “Waste Magic” is quite large as the top management of this
organization has set several target markets for its product which are given below:

 First of all, we target all over the country for selling our product. We have already decided
that we have decided to allocate 70% of our total productions for our local market (both B2B
and B2C customers).
 At our national market, disposable cups/plates are primarily dominating in the b2b sector.
For that we connect with our targeted b2b clients including restaurants, universities,
corporate organization, food & beverage company etc. to sell our products.
 Next, we also expand our business in foreign countries by exporting our products. And for
that we have decided to allocate 30% of our total production for the international market.
 Finally, we also distribute our products in grocery stores for our targeted b2c customers.

In conclusion, we, Waste Magic, are expecting that we can grab at least 40 corporate
corporations, 10 food and beverage and food companies, 300 restaurants and 200 stores to sell its
products in the first year of our business.

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4.5 Office Equipment and Personnel:
As we know that waste magic has set up an office where we are doing all our administrative task
to operate our business. For our office equipment, we have mainly invested money for buying
chair, table, desktop computer, internet connection and landline telephone. To run our office, we
need efficient and effective human resources too. A list of personnel who mainly are doing their
task at office are given below:

Category of Personnel Number of Employees

Executive 5
HR Co-Ordinator 1
Production Manager 1
IT Manager 1
Customer Care Representative 1

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4.6 Background of Entrepreneurs:
1. Name: Ashraf Muhammad Sakib
Designation: Chief Executive Officer and Managing
Partner
Address: Plot-1218, Avenue-11, Mirpur DOHS,
Dhaka-1216
Email: Ashraf98.sakib@gmail.com
Phone Number: +8801749253659
Ashraf Muhammad Sakib is currently studying as a
student at North South University and is a student of
both finance and marketing with experience in
strategic application of business concepts. Creative,
capable, trustworthy and responsible, enthusiastic,
hardworking, a resourceful team player and a quick
learner. Can consistently work under pressure and
demonstrate academic ability with excellent oral
and written communication skills and with a strong
desire to succeed. He has vast knowledge in both
the sectors of Finance and Marketing which provide
the business a comparative edge.
Being a person of such caliber, Ashraf ensures that
all the stakeholders of Waste Magic are fully
satisfied and also make certain that Waste Magic
generates sustainable revenues.

2. Name: Md. Adnan Abir

Chief Finance Officer (CFO) and Managing Partner
Address: Zigatola, Dhanmodi, Dhaka-1215
Email: adnan.abir@northsouth.edu
Phone Number: +8801713252567
Md., Md. Adnan Abir is currently a North South
University student, with a major in Finance and
Accounting. He has deep experience of Finance. He
has worked extensively in club like NSU Finance

Page | 16
 Club. Adnan is also a research assistant at North
South University, working on several research
papers and case studies. His financial knowledge
helps us to reach our breakeven point within short
period of time.
3.
Name: Jahid Hasan Joy
Chief Human Resource Officer (CHRO) and
Managing Partner
Address: Mirpur DOHS, Dhaka-1216
Email: jahidhasan84@gmail.com
Phone Number: +8801794521507
Jahid Hasan Joy is currently a student of North
South University. He has concentration on Human
Resource Management and Finance. Besides, he
also runs his another buying house business. He
must look at the company's management divisions
to ensure everything is going smoothly, with good
productivity and benefits for workers. His business
experience helps Waste Magic achieve its social
objectives.

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4. Name: Jyoti Biswas
Chief Marketing Officer (CMO) and Managing
Partner
Address: Lalbagh, Dhaka - 1211
Email: jyoti.biswas23@yahoo.com
Phone Number: +8801635722580
Jyoti Biswas is an undergrad student of North South
University. He is doing major on Marketing and
International Business. He has a strong knowledge
of International Business that also supports to deal
with the foreign companies. Besides, his marketing
expertise should help the company, according to our
strategy, to hit the target market. He is also running
the marketing team smoothly. He is also the head of
sales and ensures fast market growth and good
consumer and other stakeholders ties.
5.
Name: Md. Robiul Islam Sojib
Chief Operating Officer (COO) and Managing
Partner
Address: Bashundhara R/A, block: D
Email: robiulislamsojib5@gmail.com
Phone Number: +8801759353559
Md. Robiul Islam Sojib is currently a student of
North South University. He has concentration on
Supply Chain Management and Marketing. His
supply chain ideas help Waste Magic to maintain
the operation of the organization. This allows the
organization to reduce manufacturing expenses as
much as possible.

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5.0 Production Plan
5.1 Manufacturing Process:
Throughout our project, we not only concentrate on the manufacture of bio-degradable products,
but also make sure the processing or manufacturing method is environmentally safe, so that we
can take part in the global movement to achieve sustainable growth. We intend to take full
responsibility for the whole of the production. Nevertheless, the raw materials are acquired from
a manufacturer and production equipment is imported from Web platforms from international
firms. Firstly, we provide a summary of our biologically degradable product's development or
life cycle which demonstrates how our products can help the environment with the reduction of
pollution. The best picked rice husks are therefore collected from rice mills, screened for
pesticide residues and heavy metals, and processed by pelletizing into final raw materials. After
that they are molted to create cups and tables, which are environmentally friendly. Ultimately, it
is provided to customers with an ecological lifestyle that is safe. Then the cups and plates can be
broken down as a soil nutrient that is biodegradable. In the fields from which rice husks can be
collected, additional paddy may then be plotted. Then, as seen in the chart (Figure 1), this loop
continues. In the actual manufacturing process, our business would be liable for not all of the
steps in this chart. We mainly collect rice husk which obtain from rice mills. Then we check rice
husk to wash pesticides residues and heavy metals. After that rice husks are pelletized into raw
materials. Formerly raw materials are molded into finished goods by using machineries and
Finally we would be selling our biodegradable cups & plates in the market.

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 Figure 1: Manufacturing process of Disposable of Cups/Plates

Biodegradable Planting of Harvesting of

products used as paddy in fields. paddy.
soil fertilizers.

Consumers Collection of
enjoy healthy rice husks from
eco lifestyle.
rice mills.

Molding raw
materials into Pelletizing rice Testing for
finished goods. husks into raw pesticides and
materials. heavy metals.

5.2 Production Process: Machineries needed in each Step

Rice husks is being shipped to our factory or warehouse through road transportation vehicles
including lorries. The next move is to pelletize or shatter the husk of the rice into thin, rounded
and compressed pellets or final raw materials (under high temperatures). The raw materials are
then molded to create our plates and cups.

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This is carried out at our factory in Gazipur. The manufacturing flow steps using heavy
machinery are given below:

Once the rice husks are bought from numerous rice mill companies in Rajshahi:

a) The rice husks are tested by our hired specialists for the heavy metal content of the pesticide
residues to be preserved under a professional standard.

b) When some contamination is found, we are washing rice husks by using rice husk ash (RHA)
that functions as an absorber to kill them, helping to extract some pesticides or it may require a
comprehensive washing of rice husks with 2% salt water with the use of cold water to avoid 75-
80% pesticide or heavy metal waste (Rialch, 2019).

c) Converting rice husks into pellets would be the next step. This has achieved by a utilizing the
environmental safety high performance Ce Approved Wood / Rice Husk / Sawdust Pellet
Making Machine developed by a Chinese company named TONGFU (Alibaba, 2020) which can
produce 1.5 to 1.8 tons of 2 to 5 mm pellets in one hour. It costs around $20,000 (BDT 16, 88,
400) we have bought from www.alibaba.com.

d) Afterwards, the key stage in the production cycle involves molding our final products,
biodegradable cups and plates from the rice husk pellets. To render the machines at high
temperatures of 350 ° C and 400 kg pressing power, we require an eco-favorable Yulong rice

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husk disposable plate making machine (Alibaba, 2020). This equipment has capability to
produce 100 plates per minute of processing power. The expense of the machine is roughly
$40,000 (BDT 34, 00, 000). The following is its image:

For the processing of biodegradable cups, a popular Chinese JBZ A12 rice husk disposable cup
system is used. The rate of output is 60 plate per minute. We have purchased two set machines
and cost for one set is around $8,100 (BDT 6, 83, 802) (Alibaba, 2020). The following is an
image of this

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e) A quality assurance committee check the product's conformity with the benchmark
requirements for the second final phase.

f) Eventually, the items would be bundled together with biologically degradable cardboard boxes
which we have bought at $.10 per piece from Alibaba (Alibaba, 2020).

5.3 Names of Suppliers of Raw Materials:

We have contacted with various rice mills in Rajshahi for the supplies of our rice mills and
establish deals so that, if one fails to supply in due course, an alternate choice is open. Any of the
rice mills that could be located in Rajshahi. Some of the name of rice mills are given below:
• Nawab Auto Rice Mills Private Ltd.
• The River Rice Mill of Haque Family, Rajshahi.
• Boishakhi Rice Mills, Rajshahi.

The expense of rice husk is around BDT 300 per 50 kg. Thus, we are achieving optimum
productivity through the use of rice husk via this development cycle. As we may all know, rice
husk (caught enormously) is useless in significant quantities, while it is used as animal feed or
fired for heating. This allows Waste Magic to ensure the rice husk is not wasted, but is rather
used to help customers and the whole ecosystem.

6.0 Operational Plan

6.1 Description of company’s operation
The key goal of Waste Magic is to ensure that sustainability goals are met with the benefit both
of customers’ habits and environmental changes. We have also intended to ensure that our
manufacturing processes are indeed environmentally sustainable. Rice husks which is core raw
material of our products has obtained from rice mills of Rajshahi. As we know that paddy
farming is the largest field in the agriculture sector of Bangladesh. Therefore, we buy the rice
husk from Rajshahi at first. Then it is shipped to the warehouse which is at Gazipur. The
processing activities would take place in Gazipur, because there is an industrialization process
that takes place in Gazipur in order to benefit of other opportunities from our project. Then we
screen rice husk for finding contaminants or metals from it by doing laboratory experiments to
clean the contamination. After that the pelletizing of rice husks are occurred by one type of
machine and another type of machine performs the key task of molding the pellets into final

Page | 23
products. Once the final good is ready, it has been tested to measure the quality then packed in
environmentally sustainable cardboard boxes. There is a head office in Dhaka to perform
financial monitoring, industry studies, bulk customer requests, meetings, conferences, etc.

6.2 Flow of order of goods:

Collection of Trucks collect Rice husks used Biodegradable

rice husks from and deliver rice for production cups and plates
rice mills. husks. and packaging. ready for sale.

6.3 Business location and requirements:

Our factory and warehouse are located in Gazipur, as mentioned above. Our CFO has a home
there for which we are lucky enough that it does not carry the burden of renting a house. So, we
would set up there a plant of 1.5 bigha (0.375 acres) and a storage warehouse alongside. The cost
would be about 12 lakhs for set-up of the plant. We do benefit from other benefits, including
improved electricity supplies, better services and better transportation. The Waste Magic is
headquartered in Dhaka because the company partners are comfortably situated there.

6.4 Transportation:
We have entered into a contract with www.trucklagbe.com in order to ship our raw materials
from Rajshahi to Gazipur and our finished products from the manufacturer to distributors or
consumers. It is an app-focused 24-hour transport service provider that supplies trucks focused
on our budget, place, journey time and freight (Tabriz, 2017). This is also highly dependable,
since a GPS feature in the device helps us that the truck is to be monitored and thus guarantees
product protection.

7.0 Marketing Plan:

Market Gap Analysis:
As the product of our venture is biodegradable disposable cups/plates. But currently paper and
plastic made products are dominating in the disposable cups/plates industry. And we know
plastic is really harmful for the environment.  Thousands of tons of plastic waste are produced in
Dhaka alone every year. This plastic raises a variety of issues such as clogged drainage systems,
impaired wildlife habitats and marine eco-systems, and overall lower local environmental quality
(Dhaka Tribune , 2019). Now people of our country are getting concern about plastic pollution.

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From a survey of Dhaka Tribune, we got to know that around 86% people (26% extremely
worried, 18% worried, 17% somewhat worried, 23% slightly worried) are worried about plastic
pollution (Appendix 1). Besides, 58% people said they were worried about plastic’s effect on the
environment than their bodies (Appendix 2). Therefore, People shared with Dhaka Tribune their
enthusiasm for glass over plastic. However, studies show that producing and moving glass
bottles use almost five times more energy (Morrison, 2018). Due to consider this thought of
people, some companies came up with paper cups/plates. But the production cost of paper
cups/plates are quite higher than plastic as companies has to pay 53% import duty to government
(Ovi, 2017). And it is one of the major obstacles for paper cups/plates manufacturer companies
though their product is eco-friendly. But “Waste Magic” does not need to face this barrier as the
key raw material is rice husk which is highly available in our country. For that production cost
of our product would be quite lower than plastic and paper cups. In addition, our product is also
bio-friendly as it is manufactured from agricultural waste named rice husk. As a result, we can
fulfill the market gap with our products as well as create healthy competition with our
competitors.

Target Market Analysis:

Before going to set marketing plan, we have set the target market so that we can generate sales
volume as much as we can by implementing our marketing plan on our target group. For that we
have talked with different individuals like restaurant owners, procurement officers etc. and have
gone through different secondary resources to know about the customer insights about disposable
cups/plates market in Bangladesh. After doing our research, we got to know that the operation of
disposable cup/plate market is based on B2B process. It means suppliers manufacture and sell
directly to companies, restaurants and food stalls, based on contracts and sometimes customized
to design and scale in our country. The owner of the KPC industry (nation’s leading paper cup
manufacturing company), “Mr. Kazi Sazedur Rahman said to Dhaka Tribune that the global
disposable paper cup market is around BDT 230 billion per annum (Ovi, 2017)”. For that we
have planned to expand our business in foreign countries by exporting our products. Based on
information of our research, we categorized our target market (Figure 2) in three types which are
given in the next page:

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 Target Market A Target Market B Target Market C
Universities International Market (Nepal, General Public (Retail
Corporate Companies European Countries, United States, Customers)
Restaurants North America and Middle East
Tea Stalls countries.)
Other Institutions

Figure 2.0: Target Market of “Waste Magic”

 Target Market A: According to our research information, Disposable cups/plates are mainly
dominating in the B2B market in our country as well as Bangladesh demands 120 million
cups of one-time use every year (Dhaka Tribune, 2017). For that, we have planned to allocate
60% products (Figure 3) of our total productions. Because we are expecting that our
majority sales volume is generated from target market A.
 Target Market B: We have already known from our research that there is good demand of
disposable cups in the international market and it is around 230 billion BDT annually. This is
the reason why we have decided to export our 30% products (Figure 3) of our total
production and our possible market would be Nepal, European Countries, United States,
North America and Middle East countries.

Figure 3: Allocation of produced product for our Target Market

 Target Market C: For this group, we have decided to allocate only 10% products (Figure 3)
of our total production. Because the group has comparatively less demand for disposable

Page | 26
 cups/plates as they are comfortable to use melamine, ceramics and glass products. They only
use disposable cups/plates at different occasions like birthday party or marriage ceremony.
7Ps
7.1 Product:
The core product of the “Waste Magic” venture is disposable cups/plate which are manufactured
from rice husk at its beginning journey. When we start to generate profit, then we will extend the
product line by manufacturing different sizes of bags and other utensils in the long run. These
products will also be manufactured from different waste as our brand name “Waste Magic”
which portrays that how our venture does magic by using waste to benefit the environment and
community as well as also making money.

“Waste Magic” Disposable Plate “Waste Magic” Disposable Plate

7.2 Price:
Mainly we are following the “penetrate pricing strategy” to set the price of our products. Because
paper and plastic disposable cups/plate are dominating in the market. A lower price also enables
prospective buyers to try the goods first and then get used to it. For better understanding,
Comparison between the price of our product and competitor’s product in the market are given
below:
Product Name Price (BDT) / piece Product Name Price (BDT)/ piece
Waste Magic Cup 1.3 Waste Magic Plate 3.3
Plastic Cup 2.3 Plastic Plate 5
Paper Cup 3.75
Figure 4: Price of Waste Magic’s Products and its competitor’s product

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7.3 Promotion:
Our main goal of promotional plan is to let our target group know about our brand and its value
proposition of providing sustainable and environment friendly product to them and this message
help our venture to create positive brand image towards our target customers as well as generate
more sales and profit. Majority of our promotional activities would be like direct selling to our
B2B customers. On the other hand, we are establishing positive PR and brand image towards our
society people so that we can generate demand for greener product in the long run. Now we are
discussing in below about some of the IMC tools which we are using to promote our venture:

 Email Marketing: We are sending the portfolio of our venture and price of our products
to our B2B client as part of direct selling.
 Phone Marketing: We are approaching our potential customers directly over phone to
let them know about our products.
 Website and Other social media platforms: Build successful PR to clearly display the
good cause and be readily availability of our products for any potential buyer.
 TV News feature: To create a good brand image towards mass people.
 Content Marketing: We are publishing article and blog regularly on daily newspaper
and business magazine about activities, positioning and sustainability that Waste Magic is
taking.
 Pop Up Ads: We are letting target people of international market know about Waste
Magic and its products by showing up pop up ads in the B2B e-commerce website like
Alibaba.
 Digital Campaign: For engaging with the people of our target market, we are executing
a campaign on our social media platform. We have already set the name of our campaign
which is “Warrior of Environment”. Through our campaign, we encourage people to
stand against plastic pollution and be the warrior of the environment.
7.4 Place:
As our main target market is B2B based customers, we deliver the products to them directly after
receiving order from them. And for our retail customers, we sell our products through our
authorized wholesalers. First of all, we sell our products wholesalers and then they distribute
product to retail stores from where general people can buy our products.

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For our international market customers, we sell products through leading B2B e-commerce site
named Alibaba as well as they can order products through our website.

7.5 Packaging:
The main theme of our venture is to produce biodegradable products. This is the reason why we
have decided that our packaging of product would be biodegradable packaging. For that we buy
biodegradable cardboard boxes from Alibaba and then we use these to package our product.

7.6 Positioning:
We are going to position ourselves with the attribute of our products and establish ourselves in
the mind of customer that we are running our business not only for earning profit and but also
creating pollution free environment in our society.

7.7 People:
As earlier we have mentioned that we have established an office at Bashundhara and factory and
warehouse at Gazipur to run our business. For that we have recruited following key employees to
run our office, warehouse and factory as well:

Number
Category of of
Job Description
Employee Employe
e
Monitoring the performance of all employees and report to
HR Coordinator 1 chief human resource officer and organize primary
recruitment, training program and etc.
Lab Technician 5 Ensuring the quality of finished product of Waste Magic.
Operating machine during the production period to produce
Machine Operator 6
finished goods
Production Monitoring production performance and give instructions to
1
Manager machine operators.
Putting finished in the biodegradable card box and make
Packaging staff 2
product ready for delivery and distribution.
“Maintain receiving, warehousing, and distribution operations
Warehouse by initiating, coordinating, and enforcing program,
1
Manager operational, and personnel policies and procedures” (Monster,
2020).
Handling with our targeted B2B clients for the purpose of
Sales Executive 10
direct selling.

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 Handling the maintenance of our official website and create
IT Manager 1
content for social media platform

Customer Care Giving answer of all queries of our customers through phone
1
Representative call, email or any other social media platform.

8.0 Organizational Plan:

8.1 Form of ownership:
Waste magic is following a partnership form of business. We have sold 20% of share to an angel
investor who is acting like sleeping partner and the rest of shares which is 80%, is going to be
divided equally among the active 5 partners, which means 16% each of us (Figure 5). The whole
profits and losses will be divided according to the given ratio. The business is conducted and
maintained by five active partners. The responsibilities and duties are equally distributed among
the active partners. Nevertheless, the risk and cost of failure and liability will be considered and
carried by each partner in a uniform manner. Furthermore, each active partner has equal
authority of decision-making so that everyone can give their best efforts and work independently.
Name Ownership of Venture
Ashraf Muhammad Sakib 16%
Md Adnan Abir 16%
Jahid Hasan Joy 16%
Jyoti Biswas 16%
Robiul Islam Sojib 16%
Angel Investor (Sleeping Partner) 20%

Figure 5: Ownership of percentage of share of the venture

8.2 Identification of Partners:
The Waste magic organization is formed of five active business partners and one sleeping partner
who are allotted with equivalent profits and losses according to the ratio of ownership. The name
of the partners is given below:
1) Jahid Hasan Joy
2) Jyoti Biswas
3) Md. Adnan Abir
4) Ashraf Muhammad Sakib
5) Md. Robiul Islam Sojib

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 6) Angel Investor (Sleeping Partner)
8.3 Background Information of Management Team
The management team of Waste magic includes the partners who took the initiative in order to
form the organization and create products for the market that are both beneficial and
environment- friendly to the people of the country to help in the long-run. Moreover, all the
active partners of Waste magic are friends and they all are business student of the North South
University.
8.4 Authority of Principles
Principles Authority
Jahid Hasan Joy Active Partner
Jyoti Biswas Active Partner
Md. Adnan Abir Active Partner
Ashraf Muhammad Sakib Active Partner
Md. Robiul Islam Sojib Active Partner

Each active partner has equivalent rights and authorities to conduct the business. Each business
associate is free to give their opinions regarding any decisions or matters in the organization.
Moreover, all the partners have equal jurisdictions over the termination of partnership. In
addition to that, the regular activities, actions, supplies, productions and deliveries for conducting
the business are distributed in the same proportion so that the productions process are followed
correctly, and finished deliveries are made within the required amount of time. Nonetheless,
conclusive decisions are made through mutual consent amidst all the partners.

8.5 Roles and Responsibilities:

Name Designation Address
Ashraf Muhammad Sakib Chief Executive Officer (CEO) Mirpur DOHS, Dhaka

Md. Adnan Abir Chief Finance Officer (CFO) Dhanmondi, Dhaka

Md. Robiul Islam Sojib Chief Operating Officer (COO) Bashundhara, Dhaka

Jahid Hasan Joy Chief Human Resource Officer (CHRO) Mirpur DOHS, Dhaka

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 Jyoti Biswas Chief Marketing Officer (CMO) Lalbagh, Dhaka

 Chief Executive Officer (CEO)

The CEO of Waste magic has overall responsibility for creating, planning, implementing and
integrating the strategic direction of the organization. Moreover, the CEO is responsible for
communicating on behalf of company towards shareholders, government entities and public
and applying the Waste magic’s mission, vision and overall direction. In addition to that, the
CEO ensures to satisfy all its stakeholders and secures the sustainable income. Furthermore,
the CEO formulates and implements the strategic plan that guides the direction of the
business. Besides, the CEO oversees the complete operation of the Waste magic in
accordance with the strategic plan. On the other hand, the CEO evaluates the work of other
executive leaders and success of the organization in reaching its goals.

 Chief Finance Officer (CFO)

The CFO of Waste magic is responsible for managing the company’s finances including the
financial planning, management of financial risks, financial record keeping, data analysis and
financial reporting. CFO oversees the capital structure of the business determining the best
proportion of debt, equity and internal financing and address the issues surrounding the
capital structure. Moreover, the CFO leads and provides directions to the finance and
accounting team of the Waste magic. The CFO also recommends strategic planning to the
CEO and other members of the executive team as well as gives opinion on long-term
business and financial planning.

 Chief Operating Officer (COO)

The COO of Waste magic is responsible for overseeing and optimizing the overall
operational process of the organization. The COO formulates strategies in order to maximize
customer satisfaction and manage marketing initiatives. Moreover, the COO works together
and help to compile the budget. Furthermore, the COO controls the overall company cost in
order to work as efficiently as possible and implements better business practices. Besides, the
COO delegates responsibilities and coach employees to ensure staff members grow and
optimize their capabilities as much as possible. Not to mention, the COO puts his best effort

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 in order to secure the functionality of business so that Waste magic can obtain sustainable
growth in the long run.

 Chief Human Resource Officer (CHRO)

The CHRO of Waste magic is responsible for developing and executing human resource
strategy to support the overall business plan and strategy of the organization. The CHRO
leads and provides guidance to the HR team and oversees the talent acquisition, career
development, succession planning and training. Moreover, the CHRO helps to establish the
strategic recruiting and selection process so that it meets the human capital needs or
requirement of the strategic goals of Waste magic. In addition to that, the CHRO develops
and implement the compensation and benefits plan which are comparatively cost-effective
and competitive. Furthermore, the CHRO evaluates overall effectiveness of the employees
and motivate them to improve their efficiency at the best.

 Chief Marketing Officer (CMO)

The CMO of Waste magic is responsible for generating revenues by increasing sales through
successful marketing for the entire organization using market research, pricing, product
marketing, marketing communication and public relations. The CMO also oversees the
planning, development and execution of the organization’s marketing and sales initiatives. In
addition to that, the CMO set short-term and long-term goals and allocate resources for
achieving those goals. Besides, the CMO ensures and maintains strong relationship with the
clients and other stakeholders of Waste Magic.

9.0 Risk Management Plan

9.1 Weakness(es)/Risk Associated with the Business
 Product Satisfaction: It is very difficult to meet the requirements and standards of all the
customers as the specifications or perspective of everyone is not the same. The customers
may not like the design or functionality of the product. Thus, it will not be possible to
satisfy everyone with our product.
 Sales: The sales ratio might not align with the expected rate as predicted due to the
inadequate or complications involving the sales force, marketing efforts, supply chain etc.
 Political Instability: Political instability affect the core functions of any business.
Political instability adversely affects the growth by lowering the rates of productivity and

Page | 33
 thus hampers the overall functioning of the business. In Bangladesh, the issues
surrounding the political instability are quite common. During this situation, there can be
road-blocks due to Dhormoghot/Hartal which might halt the flow of conducting business.
As a result, the business might have to face severe amount of loss.
 Damaged Infrastructure: There are some areas in Bangladesh where the roads are
narrow, damaged and require repairing frequently. Hence, it affects and hampers the
overall supply and delivery of finished goods to client. Sometimes, due to this damaged
infrastructure, there can be delays of goods to the final client which might affects the
future business.
 Natural Disasters: Natural disasters are uncertain and often occur in Bangladesh
because of its obvious geographical position and weather. This is a risk to our business as
during the natural disaster restaurants may be not be able to run well, therefore the
demand for our biodegradable plates and glasses will be reduced which will affect our
business heavily.
9.2 Contingency & Mitigation Plan
 Product Satisfaction: We can tailor-make our products according to the customers’
requirements and instructions in order to achieve and enhance the product satisfaction.
We can also seek feedbacks from our customers’ and make necessary changes or
alterations accordingly so that we can give them the best supports cooperatively.
 Sales: We will fix the low sales issues by addressing the problems through carrying out
proper scrutinization and assessments. We will also establish methods such as: hiring of
expert sales force, increasing the marketing channels and rectifying the supply chain.
 Roadblocks: In order to address the issues of roadblocks and other political instable
situations, we can use alternative routes for transportations or delivering of our products
to the customers’ or warehouse. Thus, it will help us to avoid these unwanted and
unexpected problems in the long run.
 Natural Disasters: With the aim of mitigating the risk due to natural disaster, we will
plan for having some extra-stock of each delivery so that we have sufficient amount of
stock during the unexpected situations of natural calamities.

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10.0 Financial Plan
10.1 Assumptions:
We assumed the following rate of growth, cost and tax based on our economic growth, inflation
and demand where we presumed that political environment will be stable and the tax rate as well.
We estimated 8% growth per year of our venture because of the huge potentials of this type of
business around the world and Bangladesh as well. Besides the increasing rate of GDP of
Bangladesh which is 8% will have positive impact on our venture.

Production Capacity
Production Production per Yearly Production Yearly
Name Capacity Used
Production per minute per hour shift (12 hour/Day) Capacity Production
Cups 60 3600 43200 15768000 85% 13402800
Plates 100 6000 72000 26280000 40% 10512000
Total 160.00 115200.00 42,048,000.00 23,914,800.00

10.1.1 Cost Assumptions:

Increase in revenue will also affect the cost as Bangladesh is having inflation of 6.1% per year so
we assumed variable cost will increase as like revenue and that fixed cost will increase at 5%. As
company gets bigger this cost will be reduced in future.

Cost of Rice Husk

Unit BDT
50kg 300
1kg 6

Total cost of Rice Husk needed starting year

Required Rice Husk Cost of Rice Husk Total cost of Rice
Product Numbers
(Kg) (BDT/kg) Husk (BDT)
700 200 6
Plates
10512000 3003428.571 6 18,020,571.43
1100 200 6
Cups
13402800 2436872.727 6 14,621,236.36
Total 32,641,807.79

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 Fixed Cost for base year
Utilities
Electricity 200,000.00
Gas 80,000.00
Transportattion 100,000.00
Office Utilities 50,000.00 $ 430,000.00
Administrative Cost
Salaries and wages $ 500,000.00
Insurance and Rent $ 162,328.29 $ 662,328.29
Grand Total $1,092,328.29

Variable Cost for base year

COGS Quantity Unit Price Total Price (BDT) BDT
Direct Material
Bio-Chemicals 500 $ 2,514.00 $ 1,257,000.00
Rice Husk 5440301.299 $ 6.00 $ 32,641,807.79
Packging 12 $ 59,094.00 $ 709,128.00
Miscellanous $ 2,000,000.00 $ 36,607,935.79
Direct Labour
Wages $ 300,000.00
MOH
Product Transportation 500,000.00
Miscellanous 10,000.00 $ 510,000.00
Marketing Cost
Direct Selling Cost 2 30,000.00 60,000.00
Digital Campaing 3 100,000.00 300,000.00
Call Center Outstanding 100,000.00
Banners 200,000.00
Facebook Promotion 10,000.00
LinkedIn 20,000.00
Google Analytics & Adwords 10,000.00
SEO 10,000.00
Affiliated Marketing 300,000.00
B2B Sales 30,000.00
Other Campaign 100,000.00 $ 1,140,000.00
Grand Total $ 38,557,935.79

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10.1.2 Revenue Assumption for the first year:

Sales Forecast
Product Quantity 85% of production Price (BDT) Revenue (BDT)
Plate 10512000.00 7358400.00 3.3 24,282,720.00
Cup 13402800.00 9381960.00 1.3 12,196,548.00
Total 36,479,268.00

10.1.3 Assumption for Pro-forma Income Statement, Balance Sheet and Cash flow projections:
Revenue will be increased by 8% as we estimated our growth 8% every year from the base year. Like revenue
COGS will also increase at 8% rate as it’s directly related to production. However, other expense will be
increase at 5% rate as those are our fixed costs as well depreciations. Tax rate will be 40% according to the law
of NBR.

Taking about balance sheet, in the base year we will sell our product at max 2% of credit because of retaining
good amount of cash inflows but as from 2021 we will be increase it up to 20% to generate more sales. As, we
are offering a product which has a big demand and we may receive a big order at any time depending on
occasions or festivals so we have to maintain a good amount of inventories and for that we will produce around
30% of next year’s forecasted numbers of selling unites as inventory. As a new venture we might not have good
purchasing power so in the base year we will purchase only 5% of our raw materials on credit but from the next
year as we get bigger, we will able to increase that number to 11%. All the net incomes throughout 2020 to
2024 will be reserved as retained earnings.

For having good amount of cash inflows, we invested all our capitals on the month of January of our base year
and we won’t withdraw any amount throughout those years because the business is at initial state.

10.2 Capital Budgeting:

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10.3 Pro forma Income Statement:

Base Year Pro-forma

Income Statement
2020 2021 2022 2023 2024
Revenue $ 36,479,268.00 $ 39,397,609.44 $ 42,549,418.20 $ 45,953,371.65 $ 49,629,641.38
COGS $ 26,192,555.05 $ 28,287,959.46 $ 30,550,996.22 $ 32,995,075.91 $ 35,634,681.99
Gross Profit $ 10,286,712.95 $ 11,109,649.98 $ 11,998,421.98 $ 12,958,295.74 $ 13,994,959.40
Operating Expense
Utility $ 430,000.00 $ 451,500.00 $ 474,075.00 $ 497,778.75 $ 522,667.69
Administrative Cost $ 662,328.29 $ 695,444.71 $ 730,216.94 $ 766,727.79 $ 805,064.18
Marketing Cost $ 1,140,000.00 $ 1,140,000.00 $ 855,000.00 $ 641,250.00 $ 480,937.50
Depreciation $ 456,180.40 $ 456,180.40 $ 456,180.40 $ 456,180.40 $ 456,180.40
Total Operating Expense $ 2,688,508.69 $ 2,743,125.11 $ 2,515,472.34 $ 2,361,936.94 $ 2,264,849.77
EBIT $ 7,598,204.25 $ 8,366,524.87 $ 9,482,949.64 $ 10,596,358.80 $ 11,730,109.63
Tax $ 3,039,281.70 $ 3,346,609.95 $ 3,793,179.85 $ 4,238,543.52 $ 4,692,043.85
Net Income $ 4,558,922.55 $ 5,019,914.92 $ 5,689,769.78 $ 6,357,815.28 $ 7,038,065.78

10.4 Pro forma Balance Sheet:

Base Year Pro-forma

Blance Sheet
31/12/2020 31/12/2021 31/12/2022 31/12/2023 31/12/2024
Current Asset
Cash and Cash Equivalent 1,296,511.00 6,004,077.08 10,029,544.98 11,252,790.34 12,849,627.58
Accounts Receivable 25,930.22 1,200,815.42 2,005,909.00 2,250,558.07 2,569,925.52
Insurance and Prepaid Rent 200,000.00 200,000.00 200,000.00 200,000.00 200,000.00
Inventory 11,225,380.74 12,123,411.20 13,093,284.09 14,140,746.82 15,272,006.57
Total Current Asset 12,265,711.34 12,928,047.36 13,821,393.67 14,737,514.67 15,693,128.98
Fixed Asset
Husk to Pellet Machine $ 1,688,400.00 $ 1,688,400.00 $ 1,688,400.00 $ 1,688,400.00 $ 1,688,400.00
Molding Machine $ 3,400,000.00 $ 3,400,000.00 $ 3,400,000.00 $ 3,400,000.00 $ 3,400,000.00
RH Disposable Cup Making Machine $ 2,735,208.00 $ 2,735,208.00 $ 2,735,208.00 $ 2,735,208.00 $ 2,735,208.00
Plant $ 1,300,000.00 $ 1,300,000.00 $ 1,300,000.00 $ 1,300,000.00 $ 1,300,000.00
Total Fixed Asset $ 9,123,608.00 $ 9,123,608.00 $ 9,123,608.00 $ 9,123,608.00 $ 9,123,608.00
Total Asset $ 21,389,319.34 $ 22,051,655.36 $ 22,945,001.67 $ 23,861,122.67 $ 24,816,736.98
Liability and Owner's Equity
Current Liability 1,830,396.79 2,031,740.44 2,255,231.88 2,503,307.39 2,778,671.20
Total Liability 1,830,396.79 2,031,740.44 2,255,231.88 2,503,307.39 2,778,671.20
Owners Equity
Share Holder Equity $ 10,000,000.00 $ 10,000,000.00 $ 10,000,000.00 $ 10,000,000.00 $ 10,000,000.00
Other Investor's Equity $ 5,000,000.00 $ 5,000,000.00 $ 5,000,000.00 $ 5,000,000.00 $ 5,000,000.00
Retained Earning $ 4,558,922.55 $ 5,019,914.92 $ 5,689,769.78 $ 6,357,815.28 $ 7,038,065.78
Liability and Owner's Equity $ 21,389,319.34 $ 22,051,655.36 $ 22,945,001.67 $ 23,861,122.67 $ 24,816,736.98

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10.5 Cash flow projections:

Base Year Pro-forma

Cash flow Statement
2020 2021 2022 2023 2024
Cash flow from operation
Net Income 4,558,922.55 5,019,914.92 5,689,769.78 6,357,815.28 7,038,065.78
Depriciation $ 456,180.40 $ 456,180.40 $ 456,180.40 $ 456,180.40 $ 456,180.40
Change Current Asset (11,425,380.74) (969,872.90) (1,047,462.73) (1,131,259.75) (850,793.85)
Change Current Liability 1,830,396.79 201,343.65 223,491.45 248,075.51 275,363.81
Investing Activity
Purchase of Fixed Asset $ (9,123,608.00) $ - $ - $ - $ -
Financing Activity
Share Holder Equity $ 10,000,000.00
Other Investor's Equity $ 5,000,000.00
Drawings
Increase or Decrease in Cash Flow 1,296,511.00 4,707,566.08 5,321,978.90 5,930,811.44 6,918,816.14
Beginning Balance of Cash Flow 0 1,296,511.00 4,707,566.08 5,321,978.90 5,930,811.44
Ending Balace of Cash Flow $ 1,296,511.00 $ 6,004,077.08 $ 10,029,544.98 $ 11,252,790.34 $ 12,849,627.58

10.6 Breakdowns
For finding detail information about out income statement and cash flow statement we break down our base
year’s income statement and cash flow projections. Here, we see that the 1 st month of the operation we couldn’t
make much revenue because in that moment the company is totally new and there were no promotional
activities but as time goes forward revenue is increasing. In the cash flow statement, we have invested the whole
money based on the cash needed throughout the year as if cash flow never comes with negative figure.

Please turn over

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10.6.1 Base year’s income statement
Break-down
Income Statement Base Year
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Revenue 36,479,268.00 1,459,170.72 2,188,756.08 2,918,341.44 1,823,963.40 1,823,963.40 1,823,963.40 1,823,963.40 3,647,926.80 3,647,926.80 3,647,926.80 5,471,890.20 6,201,475.56
COGS 26,192,555.05 1,047,702.20 1,571,553.30 2,095,404.40 1,309,627.75 1,309,627.75 1,309,627.75 1,309,627.75 2,619,255.51 2,619,255.51 2,619,255.51 3,928,883.26 4,452,734.36
Gross Profit 10,286,712.95 411,468.52 617,202.78 822,937.04 514,335.65 514,335.65 514,335.65 514,335.65 1,028,671.29 1,028,671.29 1,028,671.29 1,543,006.94 1,748,741.20
Operating Expense
Utility 430,000.00 17,200.00 25,800.00 34,400.00 21,500.00 21,500.00 21,500.00 21,500.00 43,000.00 43,000.00 43,000.00 64,500.00 73,100.00
Administrative Cost 662,328.29 26,493.13 39,739.70 52,986.26 33,116.41 33,116.41 33,116.41 33,116.41 66,232.83 66,232.83 66,232.83 99,349.24 112,595.81
Marketing Cost 1,140,000.00 45,600.00 68,400.00 91,200.00 57,000.00 57,000.00 57,000.00 57,000.00 114,000.00 114,000.00 114,000.00 171,000.00 193,800.00
Depreciation 456,180.40 18,247.22 27,370.82 36,494.43 22,809.02 22,809.02 22,809.02 22,809.02 45,618.04 45,618.04 45,618.04 68,427.06 77,550.67
Total Operating Expense 2,688,508.69 107,540.35 161,310.52 215,080.70 134,425.43 134,425.43 134,425.43 134,425.43 268,850.87 268,850.87 268,850.87 403,276.30 457,046.48
EBIT 7,598,204.25 303,928.17 455,892.26 607,856.34 379,910.21 379,910.21 379,910.21 379,910.21 759,820.43 759,820.43 759,820.43 1,139,730.64 1,291,694.72
Tax 3,039,281.70 121,571.27 182,356.90 243,142.54 151,964.09 151,964.09 151,964.09 151,964.09 303,928.17 303,928.17 303,928.17 455,892.26 516,677.89
Net Income 4,558,922.55 182,356.90 273,535.35 364,713.80 227,946.13 227,946.13 227,946.13 227,946.13 455,892.26 455,892.26 455,892.26 683,838.38 775,016.83

10.6.2 Base year’s cash flow statement

Break-down
Cash flow Statement Base Year
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Cash flow from operation
Net Income 4558922.55 182356.90 273535.35 364713.80 227946.13 227946.13 227946.13 227946.13 455892.26 455892.26 455892.26 683838.38 775016.83
Depriciation 456180.40 18247.22 27370.82 36494.43 22809.02 22809.02 22809.02 22809.02 45618.04 45618.04 45618.04 68427.06 77550.67
Change Current Asset -11425380.74 -457015.23 -685522.84 -914030.46 -571269.04 -571269.04 -571269.04 -571269.04 -1142538.07 -1142538.07 -1142538.07 -1713807.11 -1942314.73
Change Current Liability 1830396.79 73215.87 109823.81 146431.74 91519.84 91519.84 91519.84 91519.84 183039.68 183039.68 183039.68 274559.52 311167.45
Investing Activity
Purchase of Fixed Asset -9123608.00 -9123608.00
Financing Activity
Share Holder Equity 10000000.00 10000000.00
Other Investor's Equity 5000000.00 5000000.00
Drawings
Increase or Decrease in Cash Flow 1296511.00 5693196.76 -274792.86 -366390.48 -228994.05 -228994.05 -228994.05 -228994.05 -457988.10 -457988.10 -457988.10 -686982.15 -778579.77
Beginning Balance of Cash Flow 0.00 0.00 5693196.76 5418403.90 5052013.42 4823019.37 4594025.32 4365031.27 4136037.22 3678049.12 3220061.02 2762072.92 2075090.77
Ending Balace of Cash Flow 1,296,511.00 5,693,196.76 5,418,403.90 5,052,013.42 4,823,019.37 4,594,025.32 4,365,031.27 4,136,037.22 3,678,049.12 3,220,061.02 2,762,072.92 2,075,090.77 1,296,511.00

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10.7 Breakeven analysis

Break-even means how many units have to be sold to recover the fixed cost which always be incurred even if
production doesn’t take place. Here, we have analyzed the break-even of our base year

Fixed cost for base year $ 1,092,328.29

Variable cost per unit $ 2.58
Weighted avearage Price per unit $ 2.70
Break-Even Point (in units) 9121314.87
Break-Even Point (in BDT) $ 24,627,550.14
BDT 24,627,550.14

BDT 23,532,992.36

BDT 1,092,328.29

9,121,314.87

From the graph we can see our fixed cost of base year is recovered when we are able to sale weighted average
of, 9,121,315 number of units which is about BDT 24,627,550.14 where in the base year we are able to generate
revenue of BDT. 36,479,268. From the break-down of our base year’s income statement we can see, fixed cost
of the base year will be recovered in the month of October, 2020.

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10.8 Payback period

Payback period refers the time period which is required to recover the initial investment. In the base year,
WASTE MAGIC needed 15,000,000 BDT for starting the operation. So, we have calculated the payback period
to get to see, how many years we actually need to get our initial investment back and we found it’s going to be
after 2.77 years of starting operation means in 2022. The calculation is given below.

Year 2020 2021 2022 2023 2024

Cash Flow $ 1,296,511.00 $ 6,004,077.08 $ 10,029,544.98 $ 11,252,790.34 $ 12,849,627.58
Initial Invetment $ (15,000,000.00)
To be recovered/excess $ (13,703,489.00) $ (7,699,411.92) $ 2,330,133.06 $ 13,582,923.41 $ 26,432,550.98
Pay-Back Period 2.77

10.9 Source of Funds

After analyzing the whole financial process, we get to see after our investment of BDT10,000,000 we are still
short of BDT5,000,000 to start our operation. So, for running smooth operation, we managed for investor who
provides us the capital in exchange of 20% share of the whole company.

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Please turn over

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10.10 Ratio Analysis
10.10.1 Liquidity Ratio: This ratio is calculated to get to see whether a company has enough
current asset to pay out current liabilities. Under liquidly ratio we calculate current and acid
test ratio. It’s always good to maintain current ratio 1.

Liquidy Ratios 2020 2021 2022 2023 2024

Curent Ratio 6.96 9.61 11.23 11.12 11.12
Acid Test Ratio 0.83 3.64 5.43 5.47 5.62

Current ratio: According to the graph we can see each and every year our venture’s current
ratio is above 1 means we are able to recover our current liabilities using current assets.

Acid test ratio: It is a liquidity ratio which measures the capacity of a business to meet short
term obligations using current asset excluding the inventory which is least liquid. Here, we
can see in the first year our acid test ratio is below 1, the reason behind that is in the base year
we just stared our production that’s why our current assets like accounts receivable, cash
weren’t that high. Moreover, our majority of current assets are inventory and this ratio is
calculated excluding inventory so this ratio is much smaller than current ratio. However, it
provider figure bigger than 1 from the next year.

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10.10.2 Activity Ratios: This ratio calculates how efficiently or intensively a business can
use it’s to generate revenue. Under this ratio we have calculated Inventory turnover and avg.
collection period.

Activity Ratios 2020 2021 2022 2023 2024

Average Collection Period 0.26 11.12 17.21 17.88 18.90
Inventory Turn Over 3.26 4.70 4.69 4.81 4.84

Inventory Turnover: This ratio measures efficiency of the firm in converting inventories
into sales. In the base year, inventory turnover is 3.26 refers in the base year we had to refill
our stocks for 3.26 times means our products demand is much higher that we were out of
stocks for 3.26 times. Additionally, increasing rate of this ratio of the followings years
implies the demand of our offerings is increasing.

Average collection period: It’s the estimated length of time it takes for a company to receive
money due in terms of receivable. From the graph we see in the base year we were able to get
the receivables within the day of sales because we didn’t allow that much credit sales on that
time as we weren’t at good position in terms of making good cash inflow but from the 2 nd
year of operation as we are able to make good amount of clash in flows, we starts allowing
credit sales to increase the number of sales amount and it results in higher avg. collection
period.

10.10.3 Leverage Ratio: Leverage ratios, is also known as solvency ratios, to measure the
ability of a venture to pay off its long-term debt. Actually, we don’t have actually any long
team or short team debts as our business is finance by equity and some part of are by working

Page | 45
capital which is our only liabilities but it’s short team and we don’t need to pay any interests
for that. Therefore, this ratio isn’t important for us.

10.10.4 Profitability Ratio: This ratio is impotent as it measures a venture’s ability to make
profit out of revenue after subtracting all the expenses and other relevant costs. This ratio is
the main purpose of doing any business. Under this ratio we have calculated two ratios which
are net profit margin and ROE.

Profitability Ratios 2020 2021 2022 2023 2024

Net Profit Margin 12.50% 12.74% 13.37% 13.84% 14.18%
Return on Investment 21.31% 22.76% 24.80% 26.65% 28.36%

Net Profit Margin: It’s the percentage amount of each available selling revenue after all
charges and liabilities have been excluded like debt, taxes and preferred share dividends. The
higher the net income margin for companies, the better. We see it’s 12.5% in the base year
and increasing in the following years in a good rate means we will be able to lower the cost
and it impacts our net positive margin in a good way.

Return on Equity (ROE): This ratio demonstrates how profitable an organization is when
comparing its net profits with the value of its overall owner’s investments. The higher the
percentage figure, the more effectively management is using the assets financed by the
owners and it will provide higher returns to the owners. According to the graph, we see like
net profit margin it’s also increasing in a good rate which means assets are properly utilized
and it will result in higher return to the investor.

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11.0 Conclusion:
The disposable utensils industry has really been on growth especially in the past few year due
to the rapid economic growth of the country due to which people in general have more
disposable income and due to the change in social trends as people now tend to eat outside
for both work and recreation which ultimately increases the use of disposable utensils in the
restaurants however, the current product offerings in the market are either plastic utensils
which eventually lead to plastic pollution or paper utensils which can be quite expensive for
the restaurants and as people are now more environment cautious, they tend to move towards
more eco-friendly solutions thus the product “biodegradable disposable utensil” which is
made of rice husks and are more affordable compared to plastic and paper utensils
furthermore, solving the problem of any kind of pollution which can be hazardous to the
planet or the people resulting in a more attractive solution which also completes a market gap
which was yet untapped.

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12.0 References
Alibaba. (2020, April 3). Boxes with logo custom printed box packing paper printing small
cardboard tuck box. Retrieved from Alibaba: https://www.alibaba.com/product-
detail/Boxes-with-logo-custom-printed-box_62250389565.html?
spm=a2700.7724857.normalList.9.2b7a153e5DRX8h&s=p&bypass=true
Alibaba. (2020, April 03). Ce Approved Wood / Rice Husk / Sawdust Pellet Making Machine.
Retrieved from Alibaba: https://www.alibaba.com/product-detail/Ce-Approved-
Wood-Rice-Husk-Sawdust_62371658526.html?
spm=a2700.galleryofferlist.0.0.faad7de3g3D7sA&s=p&bypass=true
Alibaba. (2020, April 3). Chinese jbz a12 rice straw paper machine cup making machine for
the manufacture of paper cup making disposable cup . Retrieved from Alibaba:
https://www.alibaba.com/product-detail/Chinese-jbz-a12-rice-straw-
paper_62088782636.html?
spm=a2700.7724857.normalList.7.3ef21d49cPx8Mq&s=p&fbclid=IwAR0H59IuS3c
n4V5pDf28cv_wn00XkMp0k3qn0sAFKtBywlBqgCoyBWQBRVA
Alibaba. (2020, March 28). Yulong rice husk plate making machine. Retrieved from Alibaba:
https://www.alibaba.com/product-detail/Yulong-rice-husk-plate-making-
machine_62364554674.html?spm=a2700.galleryofferlist.0.0.4936562f7bNrCz
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Appendix
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Appendix 1: People’s respondents are worried about plastics

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Appendix 2: More people said they were worried about plastic’s effect on the
environment than on their body.

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Appendix 3: Competitor’s price of disposable cups/plates

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