PONTU NETE ICAFE

BUSINESS PLAN

1.0 Executive Summary

Pontu Nete iCafe aims to provide efficient service and support to the growing need of the IT market in Zambia. With the growing use of the internet and the demand for personal computers, both for the home and business, we will concentrate in providing up-to-date hardware and software solutions as well as fast internet access and support. The public wants: (1) access to the methods of communication and volumes of information now available on the Internet, and (2) access at a cost they can afford. We intend to provide the public with this access at our premises which will also offer sales and support of hardware and software. The company emphasizes service and support to differentiate itself from more price-oriented computer companies. To be located in Woodlands, we realize that, for us to prosper, we need to be flexible and responsive, to delight clients by providing them with what they want, when they want it, and before the competition can offer it. The company intends to achieve this through a solutions approach that is customer-centric, and in which the customer's business objectives enjoy top priority. Our marketing strategy will be based mainly on ensuring that clients know what need the service(s) is able to fulfill, and making the right service and information available to the right target client. We intend to implement a market penetration strategy that will ensure that our services are well known and respected in our respective industry. Our strategy will convey a sense of quality and satisfaction in every picture, every promotion, and every publication. Our promotional strategy will involve traditional advertising, Internet marketing, personal selling, public relations, and direct marketing, details of which are provided in the marketing section of this plan. It is important to recognize what makes up our intangible resources, such as our ability to relate to customers regarding their needs and wants, management style, corporate culture and commitment. These elements will differentiate us from our competitors and contribute towards the development of a sustainable competitive advantage. In a nutshell, we don't intend to just market and sell our product and services, but to provide customized services and products that will enable our clients to optimize their output and, assist in the attainment of their goals and objectives. This business plan is prepared to obtain financing in the amount of $20,000. The financing is required to begin work on site preparation and modifications, equipment purchases, and to cover expenses in the first year of operations.

1.1 Objectives
Pontu Nete iCafe objectives for the first three years of operation include:

The creation of a unique, efficient, innovative environment that will differentiate Pontu Nete iCafe internet cafe from other internet cafes. Educating the community on what the Internet has to offer. The formation of an environment that will bring people with diverse interests and backgrounds together in a common forum. Affordable access to the resources of the Internet and other online services. Provide professional and efficient computer hardware & software support. Provide IT Consultancy to businesses that require Software Development and/or web site design.

1.2 Mission
As the popularity of the Internet continues to grow at an exponential rate, easy and affordable access is quickly becoming a necessity of life. Pontu Nete iCafe will provide communities with the ability to access the Internet and share Internet experiences in a comfortable environment. Smart business people who aren't computer hobbyists need to find quality vendors of reliable hardware, software, service, and support. They need to use these quality vendors as they use their other professional service suppliers, as trusted allies. Pontu Nete iCafe plans to serve its clients as a trusted ally, providing them with the loyalty of a business partner and the economics of an outside vendor. We will make sure that our clients have what they need to run their businesses as well as possible, with maximum efficiency and reliability.

1.3 Keys to Success

The keys to the success of Pontu Nete iCafe are:

The creation of a unique, innovative, upscale atmosphere that will differentiate Pontu Nete iCafe from other internet cafes. Differentiate from box-pushing, price-oriented businesses by offering and delivering service and support -- and charging for it. Excellence in fulfilling the promise: completely confidential, reliable, trustworthy expertise, and service(s) through the provision of an uncompromising service. This dictates that we have the latest technology, hardware, software, and well-trained personnel so as to deliver this promise. Timeous response to clients' orders: we cannot afford to delay our clients for whatever reason, as this will have a negative bearing on our image, reputation, and future business. We need to be continually communicating with the client, ensuring we provide needs-based solutions. Skill and depth of knowledge: Considering the nature of our services and their relative infancy on the market, the skill and depth of knowledge of our personnel is

of utmost importance in determining the provision of the service(s) to the endusers.

1.4 Risks
The risks involved with starting Pontu Nete iCafe are:

Will there be a demand for the services offered by Pontu Nete iCafe in Woodlands? Will the popularity of the Internet continue to grow, or is the Internet a fad? Will individuals be willing to pay for the services Pontu Nete iCafe has to offer? Will the cost of accessing the Internet from home drop so significantly that there will not be a market for Internet Cafes such as Pontu Nete iCafe? Are small businesses willing to spend on professional IT support and infrastructure?

2.0 Company Summary

Pontu Nete iCafe soon to be located at the New Shopping Mall in Woodlands will offer the community easy and affordable access to the Internet. JavaNet will provide full access to email, WWW, FTP, Usenet and other Internet applications such as Telnet and Gopher. The company will appeal to individuals of all ages and backgrounds. The instructional Internet classes, and the helpful staff that Pontu Nete iCafe provides, will appeal to the audience that does not associate themselves with the computer age. This educational aspect will attract younger and elderly members of the community who are rapidly gaining interest in the unique resources that online communications have to offer. The downtown location will provide business people with convenient access to their online needs. As a computer reseller and software developer, we aim to fill the market need for personal computers but emphasizing service and support to differentiate ourselves from more priceoriented competitors.

2.1 Company Ownership

Pontu Nete iCafe will be a Limited Company with Kapula Kambinda as the main shareholder and 3 other private shareholders.

2.2 Start-up Summary

Pontu Nete iCafe start-up costs will cover site renovation and modification and capital to cover losses in the first year, and the communications equipment necessary to get its customers online. The communications equipment necessary to provide customers with a high-speed connection to the Internet and the services it has to offer make up a large portion of the startup costs. These costs will include the computer terminals and all costs associated with their setup. Costs will also be designated for the purchase of a laser printer and a scanner.

Additionally, capital will also be needed to have sufficient stock of computer hardware for opening the business. A single estimated figure will be allocated for this purpose. The renovation/modification cost estimate will include the costs associated with preparing the site for opening business.

2.3 Start-up Requirements (Breakdown) Requirement Complete Renovation Legal Stationary & Tools. Computer Equipment (x15 + 1 svr) Printer/Scanner (x1) Marketing & Advertising Amount US$ 2 000.00 US$ 100.00 US$ 300.00 US$ 10 000.00 US$ 600.00 US$ 1 000.00 US$ 14 000.00

2.4 Start-up Assets needed (Breakdown) Requirement Stock of Hardware Cash at Bank Amount US$ 7 000.00 US$ 2 500.00 US $ 9 500.00 2.5 Company Locations and Facilities
A site has been chosen on Nkwazi Road. This site was chosen for various reasons, including: Proximity to the downtown business community. High visibility.

All of these qualities are consistent with the goal of providing a central hub of communication and socialization for the community.

3.0 Products & Services

Pontu Nete iCafe will provide full access to email, WWW, FTP, Usenet and other Internet applications such as Telnet and Gopher. Printing, scanning, and introductory courses to the Internet will also be available to the customer. Pontu Nete iCafe will also provide customers with a unique and innovative environment for enjoying surfing the internet. Pontu Nete iCafe will also provide computer products and services to small, medium, and large businesses. We will also be focused on providing network systems and services to businesses. The systems include both PC-based Land Area Networks (LAN) systems and minicomputer server-based systems. Our services include design and installation of network systems, training, and support.

3.1 Products & Services Description

Pontu Nete iCafe intends to provide the following services: 1. 2. 3. 4. Network Solutions Data Backup Solutions and Services Hardware Supply and Technical Support Training

Pontu Nete iCafe will provide its customers with full access to the Internet and common computer software and hardware. Some of the Internet and computing services available to Pontu Nete iCafe customers are listed below:

Access to external POP3 email accounts. FTP, Telnet, Gopher, and other popular Internet utilities will be available. Access to Netscape or Internet Explorer browser. Access to laser and color printing. Access to popular software applications like Adobe PhotoShop and Microsoft Word.

Pontu Nete iCafe will also provide its customers with access to introductory Internet and email classes. These classes will be held in the afternoon and late in the evening. By providing these classes, Pontu Nete iCafe will build a client base familiar with its services. The computers, Internet access, and classes wouldn't mean half as much if taken out of the environment Pontu Nete iCafe will provide. A place to enjoy the benefits of computing in a comfortable and well-kept environment.

3.2 Competitive Comparison

Pontu Nete iCafe will NOT be the first Internet cafe in Lusaka. Pontu Nete iCafe will differentiate itself from other internet cafes by providing its customers with Internet and computing services with a professional and efficient prospective.

3.3 Fulfillment

Pontu Nete iCafe will obtain Internet access from ZAIN.

3.4 Technology
Pontu Nete iCafe will invest in high-speed computers to provide its customers with a fast and efficient connection to the Internet. The computers will be reliable and fun to work with. Pontu Nete iCafe will continue to upgrade and modify the systems to stay current with communications technology. One of the main attractions associated with Internet cafes, is the state of the art equipment available for use. 3.5 Service and Support Our strategy hinges on providing excellent service and support. This is critical. We need to differentiate on service and support, and to therefore deliver as well. 1. Training 2. Upgrade offers 3. Our own internal training 4. Installation services 5. Custom software services 6. Network configuration services 3.6 Future Products We must remain on top of the new technologies, because this is our bread and butter. For networking, we need to provide better knowledge of cross platform technologies. Also improve our understanding of direct-connect internet and related communications (e.g. VPNs). Finally, although we have a good command of desktop publishing, we are concerned about getting better at the integration of technologies that creates fax, copier, printer, and voice mail as part of a computer system which can help companies communicate better internally.

4.0 Market Analysis Summary Pontu Nete iCafe is faced with competition, yet the opportunity of consistent popularity with the internet is still breaking into the market in Zambia.

4.1 Market Segmentation Pontu Nete iCafes customers can be divided into various groups. The first group is familiar with the Internet and desire a progressive and comfortable environment where they can get out of their offices or bedrooms and enjoy a fast internet connection. The second group is not familiar with the Internet, yet, and is just waiting for the right opportunity to enter the online community.

Target for internet users fall anywhere between the ages of 14 and 50. This extremely wide range of age is due to the fact that the Internet appeals to a variety of people. In addition to these two broad categories, the target market can be divided into more specific market segments. The majority of these individuals are students and business people.

4.2 Target Market Segment Strategy

We intend to cater to people who want a guided tour on their first spin around the Internet and to experienced users eager to indulge their passion for computers in a social setting. The target market covers a wide range of ages: from members of Generation X who grew up surrounded by computers, to Baby Boomers who have come to the realization that people today cannot afford to ignore computers.

4.2.1 Market Needs

The rapid growth of the Internet and online services, that has been witnessed worldwide, is only the tip of the iceberg. The potential growth of the Internet is enormous, to the point where one day, a computer terminal with an online connection will be as common and necessary as a telephone. This may be 10 or 20 years down the road, but for the next five years, the online service provider market is sure to experience tremendous growth. 4.3 Service Business Analysis The popularity of the Internet is growing exponentially. Those who are familiar with the Internet are well aware of how fun and addictive surfing the Net can be. Those who have not yet experienced the Internet need a convenient, relaxed atmosphere where they can feel comfortable learning about and utilizing the current technologies. Pontu Nete iCafe will seek to provide its customers with affordable Internet access in an innovative and supportive environment.

4.3.1 Business Participants There are a number of businesses in Lusaka that use computers and computer related technologies as a primary source for generating income. What we have found is that most of these businesses only concentrate on a selected portion of the industry, e.g. some only deal in hardware, while others use PCs for internet cafes. Pontu Nete iCafe plans to incorporate all the different faculties of the IT trade to differentiate itself from the competition. We plan to do this by offering a complete service, starting from IT consultancy to hardware/software acquisition, installation and maintenance, as well as fast Internet access from our premises. 4.3.2 Competition and Buying Patterns Due to the nature of the Internet, there are no geographical boundaries restricting competition.

5.0 Strategy and Implementation Summary Internet Caf There are three main strategies to target the market. The first strategy focuses on attracting novice Internet users. By providing a novice friendly environment, we hope to educate and train a loyal customer base. The second, and most important, strategy focuses on pulling in power Internet users. Power Internet users are extremely familiar with the Internet and its offerings. Power users tend to spend more time on the net and therefore will be our most targeted group This group of customers serves an important function at us. Power users have knowledge and web browsing experience that novice Internet users find attractive and exciting. To attract these type of users our caf will have the latest pcs on the market running the latest operation system, plus also have a very fast broadband internet connection that will allow such users to take full advantage of features the internet has to offer.. The third strategy focuses on building a social environment for our customers. A social environment, that provides entertainment, will serve to attract customers that wouldn't normally think about using the Internet. Once on location, these customers that come for the more standard entertainment offerings will realize the potential entertainment value the Internet can provide. 5.0.1 Attract Novice Internet Users First strategy focuses on attracting novice Internet users. We plan on attracting these customers by: Providing a novice friendly environment. We will be staffed by knowledgeable employees focused on serving the customer's needs. A customer service desk will always be staffed. If a customer has any type of question or concern, an employee will always be available to assist. We will offer introductory classes on the Internet and email. These classes will be designed to help novice users familiarize themselves with these key tools and the computer systems. 5.0.2 Attract Power Internet Users The second strategy will be focused on attracting power Internet users. Power Internet users provide an important function. We plan on attracting this type of customer by: Providing the latest in computing technology. Providing scanning and printing services. Providing access to powerful software applications.

5.0.3 Social Hub

The third strategy focuses on building a social environment for our customers. A social environment, that provides entertainment, will serve to attract customers that wouldn't normally think about using the Internet. Once on location, these customers that came for the more standard entertainment offerings will realize the potential entertainment value the Internet can provide. Consultancy, Hardware, software Pontu Nete iCafe intends to win and maintain customers by providing products and services that add value, safety, and are supported by a well-trained professional team with excellent technical expertise. This is important to the successful implementation of our overall strategy. Our marketing strategy emphasizes focus. The target customers will include key decision makers in business, who often order or recommend on behalf of the whole organization, the aim being to obtain an initial order and fully satisfy the customer from then on. We intend to initially build image and awareness through consistency and distinctiveness in our product and service provision. We intend to focus on delivering quality products and services that produce good referrals, which can then generate revenue. We intend to have a heavy personal selling component, supported by regular advertising we will always be active in our personal relationships with clients and strategic allies, keeping abreast of their needs and wants. We are focusing advertising on several key media, e.g. newspapers, Lowdown and handout flyers.

5.2 Pricing Strategy Determining a fair market, hourly price for online use is more difficult because there is direct competition from other internet cafes. Therefore, per minute cost will be implemented. In addition, some providers use a strategy with a combination of both pricing schemes. Regarding the hardware, we must charge appropriately for the high-end, high-quality service and support we offer. Our revenue structure has to match our cost structure, so the salaries we pay to assure good service and support must be balanced by the revenue we charge. We cannot build the service and support revenue into the price of products. The market can't bear the higher prices and the buyer feels ill-used when they see the same product priced lower at the chains. Despite the logic behind this, the market doesn't support this concept. Therefore, we must make sure that we deliver and charge for service and support. Training, service, installation, networking support--all of this must be readily available and priced to sell and deliver revenue. The following are some of the charges for services we will be offering: PC Repair (Diagnosis) K 150 000.00 Networking (Site Survey) - Free Networking K200 000.00/hour + hardware costs

Web Page Development From K150 000 upwards Web Page maintenance K50 000.00/alteration Internet caf K200/min

5.3 Promotion Strategy We will implement a pull strategy in order to build consumer awareness and demand. We will implement a loyalty scheme whereby the most active users are signed up as members and pay less per minute of browsing. The billing software we will use allows us to conduct draws out of our most active users where they will stand a chance to win prizes. Our monthly budget will include money for promotional prizes for the weekly draws like shopping vouchers from select stores like game, shoprite, movie tickets at Ster-Kinekor, talk-time and we will also have a grand monthly draw with the winner getting a prizes like Digital cameras, smartphones like the iphone, blackberry and laptops. We believe the excitement such promotional activities will create will attract more users to become members and allow us to build a strong regular client base. 5.4 Sales Forecast Initial Monthly Sales Forecast

Internet caf & Photocopying, etc Hardware Sales (less cost of sales) PC Maintenance Web page Dev. Consultancy & Application Dev. Total

K 23,520,000.00 K 12,500,000.00 K 5,000 000.00 K 1 000 000.00 K 1 000 000.00 K 43,020,000.00

Initial Monthly Expenses

Internet Connection Phone/Water/Lights Rent Salary Total

K 1 000 000.00 K 500 000.00 K 2 500 000.00 K 2 000 000.00 K 6 000 000.00

6.0 Management Summary The company, being small in nature, requires a simple organizational structure. Implementation of this organizational form calls for the shareholders to make all of the major management decisions in addition to monitoring all other business activities. 7.0 Important Assumptions

The financial plan depends on important assumptions. The key underlying assumptions are: 1. We assume a slow-growth economy, without major recession. 2. We assume of course that there are no unforeseen changes in technology to make products immediately obsolete.

8.0 Contingency Planning We intend to watch our results very carefully. We may need to concentrate less on certain products and services than others, if we intend to get the margin up or clients become difficult to attract. We might be able to avoid straight competition with the other internet cafes and IT support companies by focusing more on our prime services and other services that may arise in the future.