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Feasibility Study for a sustainability based clothing Start-up

Research · May 2021

DOI: 10.13140/RG.2.2.27761.61286

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MODULE NAME: Marketing & Business Environment
PROFESSOR NAME: Chad Manian

Cotsico Feasibility study

NAME: VRITI SHARMA

EMAIL ID:
sharma_vriti@yahoo.com
DATED: 1st May 2020

1
CONTENTS
Topic Page No.

INTRODUCTION 2.

MARKET FEASIBILITY RESEARCH 3.-10.

ORGANIZATIONAL FEASIBILITY RESEARCH 11.-16.

FINANCIAL FEASIBILITY RESEARCH 17.-23.
TECHNICAL FEASIBILITY RESEARCH 24.-27.

TECHNOLOGICAL FEASIBILITY RESEARCH 28.-30.

GANTT CHART 31.
SWOT ANALYSIS 32.

CONCLUSION 33.
COST vs BENEFIT ANALYSIS 34.

APPENDECIS 35.-44.
REFERENCES 45.

2
LEARNERS DECLARATION:
I certify that the work submitted for this assignment is my own and research sources
are fully acknowledged within the assignment.

STUDENT SIGNATURE: VRITI SHARMA DATE: 1st May 2020

1
Introduction
Cotsico, is a sustainable business start-up Idea which will majorly focus on clothing products
embodied from organic cotton and organic silk providing superior quality, comfort and
raising the importance of sustainable clothing amidst worldwide customers. In the era when
increasing global warming has become a major epidemic, the business aims to do its part by
creating sustainable fashion. As the conventionally grown cotton uses insecticides and
more than 10 percent of the world’s pesticide cause harmful effects like irritated skin,
rashes, neurodevelopmental risks etc. it is important to find better alternatives.
Cotsico with its organic cotton clothing will provide comfort to the people with sensitive
skin, luxury value to the customers, more reliability and less environmental impact. The
business will majorly be run through an online portal. The headquarters of the brand will be
located, in Berlin (Germany) and in subsequent years with proper growth, sub branches will
be established in Italy, Switzerland, Denmark (world’s most environment friendly countries).
The company aims to create a niche for itself in the market by providing the best product at
the best prices. High prices and low marketing restrained the customer growth which
Cotsico plans to address by explosive marketing and value for money articles.

Existing business model

Place of project- Berlin (Germany)
Sourcing of raw material- India, turkey, China
Products- apparels, health care products
Market size- worldwide

Purpose of the study

The purpose of this study is to do the feasibility study of the proposed business. The
detailed feasibility study is done for every section of the business management. The
study will assist in determining if the project makes financial sense and whether the
project benefits justify the costs. It will also access if the project can be put into
action with the acceptance of the key capitalist in the business and if the project can
be completed within the reasonable period. The research will be compiled of
business planning highlighting the understanding of problems and formulating
strategies accordingly in order to have a strong business plan.

2
Market feasibility research
The purpose of the market feasibility study is to determine the business proposed is
in market demand and will see sales projection and will lead to the development of
the business.

Market segmentation
Local: In actual setting there is not local market as we are operating business through
online market. But a brick and mortar will be set up in berlin where people can come
and see the quality and the designs published by the company. Customers wishing to
buy any specific product can also buy from the brick and mortar.
International: sales in the international market is assessable to all the people as we
will build our business through online market. People can order their products and
we will make sure that our delivery span is least for the customer satisfaction.
Competition: There are existing competitors in the market, as organic clothing is not
a new trend in the market but on the basis, of research our company over rules the
other brands as no other brand provides the special designing and customization
options to the customers. In addition to that we are not focusing on specific market
and handling worldwide will be a plus point in our business.
Berlin being the fashion capital with apt amount of people moving towards
sustainability is a great starter to build a brick and mortar.
Competitors Their products The place of Market size Price
the project
Thought Accessories, London UK, Europe 50€- 120€
clothing
Synergy Clothing California USA 50€ - 120€
Pact Clothing Colorado USA 16€ - 50€
Considering the collected data, the direct competitors of Cotsico are Thought,
synergy and pact which are the top brands dealing in organic clothing.

3
Indirect competitors are the brands which are selling low quality organic products on
prices lower than Cotsico. People might prefer buying clothes from such brands.

4
Place of the project
Cotsico has great benefit of place of the project as the headquarters will be located,
in berlin the fashion capital. Germany is the booming market for the demand of
organic clothing. There is a steady growth in the demand of organic clothing in
German markets. In 6 years, we have found seven-fold expansion of organic market
as the separate segment increased from 16,3€ million to 129,1€ million where
revenue increased by 66 percent. As per the study we have found three out of 10
German prefers to buy organic products also the customers are greatly obliged of
purity certificates (Karry M,2018).
In 2016, a study about consumer behaviour of Germans was conducted in which it
was found that
• Three out of 10 Germans bought organic clothes ion the period of 12 months
• The brand of the cloth was not of concern to the people rather they believe in
quality and longevity of the product.
• Six out of ten consumers were preferring the certificates of purity of the
product (Karry M,2018).
Cotsico has committed to provide certificate of purity to every customer on each
purchase.
Following the e-commerce Cotsico will Maintain a web site in order to provide the
full information of the company to the people and provide 3D facilities through
which customers can see the type of threads used, designs they want, customization
flexibility, designer options. These facilities are only provided by Cotsico.

5
Market size
As the company will be obtaining its raw material from India, China, Turkey. The
company will expand its business in these areas majorly as well. Partnership with the
recognized established brands will lead to the recognition of Cotsico as well. Market
size of the Cotsico will be expanded with business relations and partnerships with the
brands willing to move towards sustainability.
India, turkey and china are not only the world’s largest producers but also are listed
among top countries following USA moving towards organic clothing. We are
providing delivery of the products worldwide in order to have great market size.
With extensive market analysis, it came to light that organic cotton represents 0.76
percent of global cotton production and organic wool, jute, silk have also picked up
the pace and are in great demand in global market now a days. Manufacturers and
retailers are also increasing the ratio of organic usage in their products and are
expanding their offers to 100 percent organic products (fibrereport, 2017)
Company name Products The place of Market size
project
Cotsico Basic clothing Berlin (Germany) EU, turkey, China,
Designer India
Customized (Worldwide
Health care delivery of the
supplies products).

6
Products and Prices
Cotsico provides vast variety of products to its customers directing the business
towards feasibility. The brand not only focuses on clothing for fashion and normal
wear but will also introduced a section of clothing dealing for health care
departments.
The prices of the basic products are from 26€-40€, where customized and designer
products are in the rand of 50€ to 200€, the prices are in co-ordination with the
services am providing. The prices have been set up after a thorough research of
people behaviour towards buying.
Services like special designer products, customization of the type of threads, colour
and others. Certification of quality will also be given to the customers on each
purchase to build customer trust.
Cotsico Products Cotsico Prices Overall Competitors
prices and products
Basic products 26€ - 40€ 16€- 120€
Customized products 50€ - 120€ No option
Designer products 70€ - 200€ No option
Health care segment Not decided yet No option

Interesting metric about the willingness of the German Customers to pay for the
organic product showcases that people in old federal states are willing to pay 25,30
euros for basic tee shirts where as in new federal states are willing to pay 21,44
euros the same product and in berlin the price is at 23,37 euros (Karry M,2018).
Whereas if invested the worldwide pricing vs purchasing power of the people, we
have found that people are more into buying a product which can give them comfort,
trendy and the products they can tell people about (Gwendolyn & Marsha, 2015).

7
Product Trend Analysis
As per the trend analysis in recent analysis sustainability is the leading characteristic
of fashion product. Consumers are thinking practically now a days and they are
taking both price and healthy lifestyle in consideration. Wearing organic clothes
among upper middle class and high-class people is of more demand. The demand of
organic clothes is increasing 30 percent every year which is a good call for the
business.
Seeing such a steep increase in the demand of organic clothing our business will
meet its projections sooner than expected.

Trend analysis( Market Feasibilty)

20%

15%

10%

5%

0%
year 1 year 2 year 3

Increase in demand

8
Purchasing Power

Consumers Purchasing Selectiveness

power
Kids High Quality
Female High Quality + Price
Male Medium Quality
Health Care departments Medium Quality+ Price

A study from A.T Kearney has found that most of the children in Canada and US are
moving towards sustainable products, as per national retail federation survey most
of the parents worldwide are telling their kids to go for organic products and are
promoting sustainability (Lucy K, 2019).
As per the consumer behaviour studies it is found that generally, the customers are
attracted towards the product by colour, fabric, price, comfort, trend and below is
the table of variable and source and consumers attitude towards organic products
(Gwendolyn & Marsha, 2015).
Variable and Consumer attitude towards organic clothing
source
Environmental The dyes and chemicals used in apparel production can be harmful
attitudes to the environment.
Organic agriculture is good for the environment.
I am concerned about the impact of clothing production on the
environment.
Clothing I would go out of my way to buy organic clothing.
attitudes I would buy organic clothing to help support organic farming.
Benefit-related Improving my health or the health of my family
outcomes Supporting organic cotton producers, reduction in the use of
pesticides.
Purchasing a quality product and Supporting pro-environmental
companies.

According to the study 38 percent of the people have positive attitude towards
organic cotton and we have found that 10 percent increase in the market of organic
clothing (Textile exchange,2018).

9
Promotion (Product involvement)
Product involvement of the customers will be raised by raising awareness among
people, about the benefits of moving towards sustainability.
Google display ads to appear on relevant pages, clothing blogs to increase the
involvement of people.
Partnerships with bloggers, influencers, known personalities will socialize our
products and brand.
Association with brands, the brand image will be created on associating with known
brands in the market who are willing towards sustainability.
Showcasing of our products at international level will explain the motto behind our
project but also more known among customers (Margot W,2019).
Social media is the biggest platform available for any brand to advertise, therefore
we will tie up with major influencers and fashion bloggers to test our products and
showcase their quality.
Organizing fashion shows in popular cities and places where people can come and
see the catalogue, understand the brands story and how they are helping to maintain
the environment while producing excellent clothing products.
Supplying products to the health sector like hospitals where the organic cotton
products will act as crucial part as it is good for skin.

10
Organization feasibility research
The purpose of the study is to show that the company has viable organisation
structure. The management team is logistically set and will be maintain work
balance.

Company ownership
Cotsico will be owned by Vriti Sharma the founder and CEO of the company. The
Founder of the company is willing to give 13 percent if the company’s share to the
investor also a special position to the investor in coming future when the business
will be at its hike. the founder of the company will be returning the amount taken by
investor in the period of one year.

OWNERSHIP(initial)

OWNER INVESTOR

11
 Code of Ethics
In order to maintain a good organization feasibility, we need to have code of ethics
as we will follow the same

• We will be inclusive, considerate and respectful to all the workers and

investor opinion and we will not discriminate on the basis, of caste, gender,
position, age, mental and physical ability.
• We will not harass and not threat any worker in any situation the business
will be going through.
• We will perform our business by following strict norms of anti-bribery and
anti-corruption code of conduct.
• The company assets including physical, intellectual, electronic, digital assets
will be protected (Code of ethics and professional conduct, 2019.

Hierarchy

VRITI SHARMA
(CEO)

CHIEF
CHIEF CHIEF
FINANCE
TECHNICAL OPERATING
OFFICER
OFFICER OFFICER

BUSINESS MARKETIN
SEARCH
WEB SOFTWARE WEB LEGAL DEVELOPM G GENERAL SALES
ENGINE
DEVELOPER EXPERT OPTIMIZER TEAM ENT COORDINA MANAGER MANAGER
OPTIMIZER
OFFICER TOR

OPERATION SALES
S TEAM TEAM

12
Management process

Our management team will be highly skilled and greatly experienced, the team is
obliged to work discreetly to generate maximum profit to the company.
Job profiles Number of employees
Chief Finance Manager 1
Sales Manager 1
Sales Team 1
Chief Operating Officer 1
Legal Team
Business Development Officer 1
Marketing Coordinator 1
Chief Technical Officer 1
Software-expert 1
Web Developer 1
Web optimizer 1
Search-engine optimizing expert 2

• Chief Finance Officer with minimum work experience of 6-7 years will receive
all the data regarding sales and purchase from Sales manager and further
Sales manager will handle Sales team. Employees who have knowledge of
sales and experience of at-least 2 years in sales will be employed in brick and
mortar located in berlin. There will be only 2 people working as sales person
(one male, one female).
• One sales manager with minimum work experience of 5-6 years will handle
the sales department of the company, sales manager will have to keep
monthly update of the sales report. All the sales expenditure will be managed
by sales manager.
• Chief operating officer with minimum work experience of 5- 6 years will
manage Legal team of the company, business development officer, marketing
coordinator.
• The company will have its own legal team which will guide us through all the
business policies and laws to be followed by the company.
• The marketing manager with minimum work experience of 5-6 years will keep
an updated information about the new trend in the market, will help us in
carrying out campaigns, fashion-shows also socialize our products in any
possible way.

13
• Online business handling employees will work in the separate section and will
be under Chief Technical Officer.
• Chief Technical Officer with minimum work experience of 4-5 years will keep
update about the software developers, web developers, web- optimizer,
search engine optimizing expert.
• The customer support section of the company will be outsourced to different
companies in different countries to compensate the language barrier. The
outsourcing will be limited to ensure minimum expenditure.

14
Legal Framework
As the company’s headquarters are in Berlin (Germany) the company will have to
follow German Business and Commercial Laws under which company will have to
follow all the mentioned rules and regulations and some of them are mentioned
below
Legal framework will include set of legal hierarchy which includes constitution,
legislation, regulation and contracts.

Contract

Regulations/Rules

Policy/Legislation

Constitution

Moving from the bottom to the top the company will follow the legal hierarchy.
Rights to lands ownership, civil legal process, labor standards will be granted by
constitution.
Under policy and Legislation, we will follow labor laws, tax laws, land management
laws, international trade laws (Smith & Erin, 2011).
The company will have its own legal firm which will handle all the legal framework.
Recognized lawyer will be hired to follow the process and make us familiar with the
same.
Under the contract, we will follow the workers contract policy and the contract of
the space occupied for our brick and mortar.
Employees will be hired on the contract basis and will be issued legal job
employment contract. We will follow Fixed-term contract in the beginning, once we
are assured about the working ethics of the workers, we can change it to permanent
employment contract.
The contract will be established with the fixed working hours, as per German
working hours Act, employees cannot work more than 8 hours daily, so that is

15
around 35 – 40 hours per week. Salary, the minimum wage in Germany is 9.25€ per
hour.
Obligation to secrecy
Workers are bound by law to keep company secrets to themselves (Act Against
Unfair Practices). Employees are not allowed to share company’s sensitive
information. Information of the economic sector, technical data and operational data
which includes production infrastructure, computer software, balances, calculations,
inventions, all the secured data if shared by any employee outside the company will
be punishable.
Non-Competition Clause
The clause forbids employees from working with the rival companies one can work
with other companies only with our consent other then that they will not be
permitted for the same and action can be taken against defaulties.

16
Financial Feasibilty
The purpose of the study is to show that the proposed project is financially feasible and will make a
projection on the rate of return on invested capital. Viability of the proposed venture by evaluating
the start-up costs, operating expenses, cash flow and making a forecast of future performance.

Start-up cost and funding

This business plan shows how total investment of only €150,000 could generate lumpsum of
profit €110,000 during first year and subsequent growth to €300,000 by third year. The
purpose of this plan is to secure the additional funding of €130,000 from the investors to
cover up the start-up cost of the business. In return for investing the capitalist will be
offered 13% equity.
The funds provided by the investor will be used in the procurement of raw material,
production cost, supplier cost and the delivery cost and the list of the same will be provided
to the venture capitalist. The investor will also be invited to discuss quality and quantity of
the stock to be issued. Liquidity of the cash flow will be maintained with enough cash
reserve for unseen future events.
In the chart below we have given a detailed information about the usage of the additional
investment from the capitalist, in order to maintain the liquidity, we have provided the
detailed information.

Funding chart

invester investment
self investment
expenses fund
assests fund

17
 Start-up Cost and Funding Plan
Planned Investment
Self -investment €20,000
Investor investment €130,000
Total Investment €150,000

Start-up funding

Start-up expenses to fund €60,000

Start-up assets to fund €70,000
Total funding required €130,000

Start-up Expenses
Operating costs €25,000
Workspace €6,052
Marketing €15,000
Training and Support €10,000
salaries €3,948

Total start-up Expenses €60,000

Start-up Assets
Business Equipment €15,000
Starting inventory €40,000
Leasehold improvements €15,000
Total Assets Fund required €70,000

18
Cash flow projections
Coping Negative cash flow
During the initial period of business, we will experience negative cash flow as during
the initial period there will not be much positive sale projections. The investment in
fixed assets like the rent of brick and mortar and others usually lead to the negative
cash flow. For the same we have few possible ways to cope with the negative cash
flow.
Analyze the expenses
We will analyze the expenses and slash the extra cost investment. When not needed
the employees can be sent home earlier.
Negotiating payment terms
Customer’s payment term is already fixed, as we have online business so customers
will have to pay at the time of purchase, customers buying from brick and mortar in
berlin will also have to pay on purchase.
Vendor’s payment term, we have the vendor’s who are willing to rent us the brick and
mortar and are flexible with the payment terms. We can give them involve in
installments during the initial periods or we can give the invoice on 2 percent interest
rate for late installments.
Reduce operating expenses
We have made sure that the company deals with genuine partners, we are willing to
run our business with specific recognized companies who are willing to provide the
raw material at the lowest price in order to maintain long term business relation.
Maintaing positive cash flow projections
To make sure that the company’s financial heath is positively projecting we are
obliged to keep the record of cash flow of every month. It will allow us to plan our
accordingly, we will be able to cope with unseen future scenario. In order, to keep a
check on cash flow we have decided to keep the record month wise and if we see any
significant changes in the cash flow which can affect our business negatively, we will
look into the flaws and make amendments where necessary.
To make sure accuracy in the projections every year we will look into
o Months with three payrolls
o Months when we have to pay insurance premium

19
 o Time period when we have faced more tax because of increased sale.
Ongoing spending, we will set up a clear budget and determine the spending. We
can’t avoid over-head costs but we can look into the data from where we can trim the
extra outgoing amount. We will have to look into the rents of the property, we have
lenders willing to lend their property on flexible payment terms.
Set up a line of credit, the financial institution will guide us through setting up a line of
credit, we have extra 20,000€ just in case to meet with the future unseen scenarios.
We will not use the money from the credit line. We will make sure at first to return
the investment of the capitalist.
Pricing, the company has already set up the prices as per the services provided.
There’s no compromise in the prices of the products. We will be offering discounts on
few of the products keeping in sight the margin of profit. The company has also done
a deep research in the attitude of people towards prices (Rebecca A, 2019).

Cash flow projection of first 12 Months

Month 1 Month Month 5 Month Month 8 Month 9 Month Month Month Totals
4 6- 7 10 11 12
Beginning € € € € € € € € € €
Balance 25,000 41,459 42,784 56,014 70,554 83,784 97,013 98,309 1,11,539 1,24,768
Cash Inflows
Cash Sales € 6,00,000
50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000
Accounts € 5,50,000
Receivable - 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000
Total Cash € € € € € € € € € €
Inflows 50,000 1,00,000 1,00,000 1,00,000 1,00,000 1,00,000 1,00,000 1,00,000 1,00,000 1,00,000 €11,50,000

Cost of € 9,20,000
Goods Sold 40,000 80,000 80,000 80,000 80,000 80,000 80,000 80,000 80,000 80,000
Operating € 1,800
Expenses 150 150 150 150 150 150 150 150 150 150
Payroll €
4,783 4,783 4,783 4,783 4,783 4,783 4,783 4,783 4,783 4,783 57,396
Taxes - €
- 11,904 - - - 11,934 - - 11,949 47,707
Loan €
Payments 1,837 1,837 1,837 1,837 1,837 1,837 1,837 1,837 1,837 1,837 22,049
Owners € -
Distribution
Total Cash € € € € € € € € € €
Outflows 46,770 98,675 86,770 86,770 86,770 86,770 98,704 86,770 86,770 98,720 €10,48,951
Net Cash € € € € € € € € € € € 1,01,049
Flows 3,230 1,325 13,230 13,230 13,230 13,230 1,296 13,230 13,230 1,280
Operating € € € € € € € € € €
Cash Balance 28,230 42,784 56,014 69,244 83,784 97,013 98,309 1,24,768 1,26,049
1,11,539
Ending Cash € € € € € € € € € €
Balance 28,230 42,784 56,014 69,244 83,784 97,013 98,309 1,11,539 1,24,768 1,26,049

20
 Economic viability
Net present Value, the amount of investment is 130,000 €. The net present value
should exceed the amount invested in order to prove the feasibility. Our company
showing a positive projection moves towards the feasibility.
Period Cash flow NPV Discount rate (5%)
Year 1 €101049 -€33,762.86
Year 2 €216215 €75,919.05
Year 3 €288190 €144,466.67

Payback period, we can return the invested amount in the period of two years. The
capitalist will be offered 13% share of the business. The company will meet its break
even by the end of first year and will be seeing projections in the later years. We will
reach the break even during the first year of the business.

Break even analysis

As per the company’s conservative analysis, the break-even amount has been
projected at €33740. According to the recent market trends and analysis the company
will break even by the end of first year and will grow profitably year over year.

34000

17000

8000

0
SALE

8000

17000

34000

150 300 450 600 850

UNITS

21
Potential future profit
According to our conservation calculations Cotsico will maintain healthy financial
position in the market and will reach the break-even point during the first year of its
business. We also expect that we will see a rapid growth in the market in the
upcoming years and we will have good profit returns from beginning of the second
year only. We will have enough savings to overcome the unseen scenario and we will
be able to maintain positive cash flow of the returns.
There will be projection in the current ratio, quick ratio, return on the equity will also
be decreased. Sales to assets ratio will also be decreased as we will see more sales in
the consecutive years. We will move towards increase in net profit margin in every
consecutive. The same has been presented below.
Financial Ratios Year Year
Year One Two Three
Liquidity
Current Ratio 1.3 2.9 5.0
Quick Ratio 1.1 2.7 4.9
Safety
Debt to Equity Ratio 1.2 0.4 0.2
Debt-Service Coverage Ratio – 0.8 1.6 2.1
DSCR
Profitability
Sales Growth 0.0% 30.0% 30.0%
COGS to Sales 80.0% 80.0% 80.0%
Gross Profit Margin 20.0% 20.0% 20.0%
SG&A to Sales 4.9% 4.5% 4.5%
Net Profit Margin 9.3% 14.1% 14.5%
Return on Equity (ROE) 84.8% 62.7% 45.5%
Return on Assets 39.0% 44.0% 37.1%
Owner's Compensation to Sales 0.0% 0.0% 0.0%
Days in Receivables 15.0 15.0 15.0
Accounts Receivable Turnover 24.0 24.0 24.0
Days in Inventory 9.4 7.3 5.6
Inventory Turnover 38.4 49.9 64.9
Sales to Total Assets 4.2 3.1 2.6

22
23
Technical Feasibility
The purpose of the study is to assess the details how our company is intending to
deliver the final product to our customers. The study will include a deep research on
raw material, labor, delivery of the product, technology, location of the business. The
study will help us in reaching to the target market by troubleshooting the problems
in the business plan and will also project towards the long- term planning of the
business. Technical feasibility will include a complete research on supply chain
management.

Supply chain management

Supply chain management gives us a recoded data of from where we are obtaining
our raw material and where it goes for manufacturing then it goes to the distributer
and the retailer and then the consumers. The supply chain explains the logistics of
the company. Supply chain of the company is described in detail below:

Supplier Distributer Consumer

Raw material Manufacturer Retailer

24
Material Requirement
The raw material required for the production are Organic Cotton, Bamboo, Organic
linen, Organic wool, Hemp, Tencel, Modal, Organic silk, Wild silk, Natural peace silk.
The organic cotton we will receive will be SGO (standard certified cotton) or GOTS
(global organic textile standard) organic cotton.

Customers order Bill of materials

Purchase orders

Master Material requirement

production planning Material plan
schedule

Inventory bills Works

Forecast

Sourcing of raw material

Cotsico has been in talks with number of textile companies and has decided to
expand business with few of the selected companies. We are planning to get our raw
material from India, China, Turkey. These are the top organic cotton and organic silk
producers. India being the number one of all the countries constitutes 66.90% of the
total production of organic cotton and organic silk. Followed by china constitutes
11.69% of the total production, China occupies a crucial position in the production of
organic cotton and silk with 4218 ha. being the total production area and 8,106 mt
fibre production (Martin M,2010). Turkey constitutes 6.48% of the total production
(Textile exchange organization, 2017). Turkey has well established organic cotton
production yields, the organic farming is carried out mostly in northern areas of
turkey also it has been the major sector for employment in the country.

25
Manufacturing (Textile companies)
Few of the companies which the Cotsico will be working with for textile exchange are
listed in the table below, we have selected them on the basis, of prices and the
quality of material that they provide, all the companies are OCS, GRS, certified
companies.
Company name Standard Country Certifier
Acar Ihr Ith.Tekstil RCS, OCS Turkey ETKO
Tic. Ve San.A.S.
3b Kumas San.Ve RCS, OCS Turkey ETKO
Tic Ltd.Sti
A&M Clothing Co., GRS China Intertek
Limited
A&E Hengmei GRS China Onecert
Spinning Company
Limited
A-Tex Home OCS, GRS India Control Union
Collection
Star Textiles GRS India Control Union
RCS- Recycled claim standard OCS- Organic content standard GRS- Global
Recycled Standard

The material requirement will depend on the demand of the product by the
customers,
The basic products will be in bulk, the customized products will also be in bulk but we
will follow lean manufacturing in case of designer products. As designer products are
expensive and will require expensive raw material, as well as we will have to manage
extra payrolls or designers working with the company.
A data will be kept in which we will manage how much sales we are seeing of
product and as per the data collected, we will order the raw material.

Transportation and distribution

As we have online business, our items will be shipped via local couriers, DHL, Fed-ex,
USPS and other shipping companies. The most important shipping considerations are
on the following basis:
Product size and weight, the shipping prices which we will be charged will be as per
the product size and the weight of the product we are willing to deliver our
customers.

26
Shipping destinations, whether we are shipping local or international. Cotsico has
worldwide shipping so will be dealing in both and we are willing to provide free local
shipping but there will be international shipping charges.
we will be providing options to the customers of free-in store pick up, same-day
delivery (extra charges) for the local purchasers.
For international shipments if any customer needs speed delivery will also be
charged extra.
We will follow few of the below mentioned strategies for our shipping procedure:
1. Free shipping, for example free shipping on orders above 25€, this criterion
will include only the products which don’t cause heavy duty cost or which are
not much in weight. In this case it is easy to attract customers and we can
easily payback the carriers with a certain margin of profit.
2. Flat rate and table shipping, a fixed shipping charge for the products which
can cause heavy duty charges and which are heavy. This criterion will majorly
be done on international deliveries.
3. Live rates from the carrier, we will apply the fixed shipping charges on some
of the products learning from our carrier partners so that we can make profit
and we don’t have to pay from personal the carrier charges (Ashley Overton
2020).
Cotsico has decided to work with Logesta, the company will act as well
functioning part of the supply chain. Logesta runs its business all over the world
and does the worldwide deliveries. As per the record company has its own track
and trace and risk prediction system monitored by control central. They have
security department in contact with state law enforcement agencies. Logesta
handles over 150,000 annuals worldwide shipping.
Retailer
As discussed above the company will follow its business through online market
and mostly the work will be dependant, on distributers but we are also planning
to merge our brand with other recognized brands which are willing to move
towards sustainability like H&M, C&A , Marks and spencer, Nike, Woolworths,
timberland and others. With the help of these brands we will get recognition
worldwide. The retailers will sell the product with the prices as per their region,
and will be given special compensation from our company for selling our products
at their showrooms.

27
Technological Feasibility
The purpose of the study is show how Cotsico ahead in technology, in
technological feasibility we get to see a detailed information about company’s
working module and through which ways they are making it possible to reach its
viability.

E- business model
Cotsico plans to continue business with only one brick and mortar in berlin and
majorly through E-business. A website will be created for the same and
worldwide customers will have reach to the online shopping site. The brand
website will have the information about company’s hierarchy, management
procedure. Any information about the exchange of the product, ordering the
product in bulk, all information be provided on the web-site.
All the details regarding the products will be mentioned with each product in its
description option.
Issues regarding the size, will be explained in the size chart.
Contact information for the companies willing to work with our brand will be
provided on the website as we are open to all the brands looking towards
suitability.
We will be having a mobile application for all the customers in later year of our
business expansion.
Digital approach
search engine marketing, digital marketing that will increase the visibility of our
website in the forms of ads to approach number of consumers.
e-mail, one of the best digital approach towards increasing the visibility of the
brand by sending e-mails to the consumers.
search engine optimization, when people search for something related to
apparel, they will get our brand ads on the head of the google or bling.
IT Requirement
Web development expert,
Camera expert,

28
 3D model software expert, as we will be providing 3D model of our products on
the website, if any customer is personalizing their product can see the 3D model
of their products.

Exit strategy
We recognize every investor irrespective of the investment and irrespective of all the paper work
done during the establishment of the business will need an exit strategy. Our Exit strategy will
provide the best alternative way for maintaining investor’s interest while the potential of the
business will also be maintained.

Generally, the fear of investor is they will be stuck with the company forever with no growth in profit
margins or the fear that company will go bankrupt and the investor will also have to face the
consequences.

In order to overcome the problem and maintain the interest of the investor we have decided on few
of the exit strategies which are beneficial for the investor and we would like to discuss the same

o Merger and acquisition, win-win situation when bought by a larger company or merge with
company with complimentary skill.
o Initial public offering, raising capitals from public investors.
o Make it a cash cow
o Sell to a friendly individual
o Convertible preferred stock
o Anti-dilution measures

We believe with below mentioned negotiating terms we will be able to increase investors
confidence and improve investor management relationships.

o A board position can be offered to the investor.

o Discussing before introducing new products in the marketing, issuing more stock.
o Maintain a transparency in the cash flow.
o Anti-dilution provision that will result in receiving more stock to the investor.

Cotsico will maintain its good business relation with the investor and will keep them up to date
about the cash flows. If there is any change in the working strategies the company will discuss with
the investor and their opinion will be respected. Cotsico has provided a transparent exit strategy for
investor satisfaction.

Risks and Risk management strategy

Company management is responsible for calculating the risks and taking corrective actions against
the same, there are many risks but considering the risks which can affect our business and our risk
handling strategy I have mentioned below

External risks
Competitors and change in trend

Many new competitors will enter in the market with new and improved products, the trend in the
market will not affect us much as we are already working in customization and designer section of

29
the market in addition, we have the benefit of lean manufacturing of some products. The
competitors will also not affect us much as we have strong management team which will keep
control on cost control and advancement techniques.

Location

We are working majorly on e-market and working globally, addition to that the headquarter of the
Cotsico will be established in Berlin the fashion capital, after a deep research on the prices the
company has set up the price range for the customers interest.

Inflation

On the basis, of research we have found that there is a positive inflation in the trend of organic
clothing in the market as most of the brands are looking forward to merge with sustainable brands
and are introducing organic products, which can be beneficial for our company in the coming future.

Internal factors
Cash flow deficiency

Our main concern will be to get maximum return and have an adequate amount of cash to meet all
the payment obligations. Our conservative cash flow chart shows that our business is able to
generate a positive cash flow and we will have enough amount saved in unseen scenario.

Management

Cotsico will have highly qualified and experienced management team, they will look after the shout
outs in the market and we will be aware of trends in the market. The owner of the business also has
done a great research in the market before taking the decision of start-up.

30
Gantt chart
Task Start Days Days End date completion
Sourcing 02-01- 21 1/23/2021 100%
2021
Designing 13-01- 17 1/30/2021 95%
2021
Production 01-02-2021 18 2/19/2021 99%
IT development 17-02-2021 11 03-06- 89%
2021
beta testing 08-03-2021 11 3/19/2021 90%
alpha testing 17-03-2021 14 04-03- 100%
2021
launch 05-04- 14 4/19/2021 93%
2021
department 20-04-2021 17 05-03- 80%
meetings 2021
financial meetings 03-05-2021 21 5/24/2021 96%
marketing 14-05-2021 15 5/29/2021 89%
online interviews 05-06-2021 13 6/18/2021 95%
inventory 19-06- 14 07-05- 89%
2021 2021
promotions 01-07-2021 19 7/20/2021 100%
legal formalities 10-07-2021 20 7/30/2021 99%
final launch 20-08-2021 10 08-10- 100%
2021
1/2/2021 2/21/2021 4/12/2021 6/1/2021 7/21/2021 9/9/2021

Sourcing
Designing
Production
IT development
beta testing
alpha testing
launch
department meetings
financial meetings
marketing
online interviews
inventory
promotions
legal formalities
final launch

31
SWOT Analysis
Strength
o Capital stock, we have
maintained a strong capital
base.
o Aggressive and focused
marketing campaign with clear
goals.
o We have wide experienced
team.
o Services provided are exclusive.
o Wide range of products.
o Constant innovation, new trends
every month to keep consumers
hooked.
o Transparency, Cotsico will
provide purity certificate to its
customers with every purchase.
o Introduction of health care
products.
Opportunities
o Partnerships, number of brands
are willing to promote organic
clothing.
o Green initiative by consumers,
people are moving towards
sustainability and are promoting
among others as well.
o Growth in the market size.
o Government initiative towards
green consumerism.
o People can shop designers and
customized organic products
from Cotsico.
32
Weakness
o Establishing a reputation will be
challenging.
o Lack of capital, major amount of
start-up funds will come from
investors.
o Low market penetration.
o High labour cost in Berlin.
o High production cost.
Threats
o Competitors, they sell same
products and have loyal
customers, thus will be difficult
to attract customers towards
our new brand.
o Price, the prices of our company
range till 200€ where as other
companies have till 120€, which
can affect the sales.
o Changes in government
regulations.
Conclusion
After conducting extensive research over the EU region, especially in Berlin, many
instances came to light. It was observed during marketing research that the customer
base in Europe is enormous for organic clothing and the people living here have the
purchasing power and the intent to purchase these products. The government is also
supportive of green initiatives and the customers to be inclined towards sustainable
products.
Technologically, it was observed that the required industries and resources are
available to make the project a success. The people required are available to write
websites and applications. It is also a viable option to outsource some of the
departments like customer service to an extent. Although the labour in EU is
expensive but the quality provided is far greater than any other country.
The Organizational hierarchy is also clear and concise and provides for an open
environment of learning and progress within the company. The employees will have
a sense of belonging and appreciation in the company and will not feel bogged down
by unnecessary distractions.
Raw material is available abundantly and many textile industries are already
established which can work in collaboration with the company to produce the
highest quality clothing and other materials. The raw material is sourced from India,
China and Turkey where a part of the profit will be shared with the farms in addition
to the cost of material and also the website of the company is designed in such a way
to showcase factories and also provides a certificate of purity which shows from
where the raw material like cotton or silicone was sourced and where it was put
together.
Financials play a big part in setting up of the company and through excessive
research, it is visible that the resources can be arranged for putting up inventory and
running the company profitable after 1st year of running. The company provides
opportunity for the investors to grow their money and be a part of the company’s
board of directors. The exit strategies are also clear which can benefit both owner
and investor.
Overall, the project is feasible and has the potential to grow in a major success over
the years and provide exciting returns.

33
 Cost vs Benefit analysis
Period Cost (total cost/total Benefit Ratio
sales)
Year 1 0.8 €-33,762.826 -2.3
Year 2 0.8 €75,919.05 1.0537
Year 3 0.8 €144,466.67 5.53

Chart Title
300000

250000

200000

150000

100000

50000

0
Cost (total cost/total sales) Benefit Ratio
-50000

Year 1 Year 2 Year 3

70,000
MARGINAL
55,000
COST

45,000

33,000

25000

15000 MARGINAL
BENEFIT
PRICE (€)

UNITS SOLD 0 2000 3500 4600 5700 7200 8000 10000

34
APPENDICES
Balance Sheets
ASSETS First Year Second Year Third Year
Current Assets
Cash 1,26,049 3,42,264 6,30,454

Accounts Receivable 50,000 65,000 84,500

Inventory 25,000 25,000 25,000
Prepaid Expenses - - -
Other Initial Costs - - -
Total Current Assets € 2,01,049 € 4,32,264 € 7,39,954

Fixed Assets
Real Estate – Land - - -
Real Estate – Buildings 10,000 10,000 10,000
Leasehold Improvements - - -
Equipment 50,000 50,000 50,000
Furniture and Fixtures 20,000 20,000 20,000
Vehicles - - -
Other 20,000 20,000 20,000
Total Fixed Assets € 1,00,000 € 1,00,000 € 1,00,000
(Less Accumulated Depreciation) € 15,643 € 31,286 € 46,929
Total Assets € 2,85,405 € 5,00,978 € 7,93,024
LIABILITIES & EQUITY
Liabilities
Accounts Payable 40,000 52,000 67,600
Commercial Loan Balance 1,14,090 97,366 79,786
Commercial Mortgage Balance - - -
Other Bank Debt Balance - - -
Line of Credit Balance - - -
Total Liabilities € 1,54,090 € 1,49,366 € 1,47,386
Equity
Common Stock 20,000 20,000 20,000
Retained Earnings 1,11,316 3,31,613 6,25,639
Dividends Dispersed/Owners Draw - - -
Total Equity € 1,31,316 € 3,51,613 € 6,45,639
Total Liabilities and Equity € 2,85,405 € 5,00,978 € 7,93,024

Balance sheet in or out of balance? € - € - € -

Balanced! Balanced! Balanced!

35
 Income Statements

Revenue First Year Second Third Year

Year
ABC product
12,00,000 15,60,000 20,28,000
Total Revenue € 100% € 100% € 100%
12,00,000 15,60,000 20,28,000
Cost of Goods Sold

ABC
9,60,000 12,48,000 16,22,400
Total Cost of Goods Sold 80% 80% 80%
9,60,000 12,48,000 16,22,400
Gross Margin 20% 20% 20%
2,40,000 3,12,000 4,05,600
Payroll
57,396 68,875 89,537
Operating Expenses

Advertising
120 124 127
Car and Truck
Expenses 120 124 127
Commissions and Fees
120 126 132
Contract Labour (Not
included in payroll) 120 124 127
Insurance (other than
health) 120 124 127
Legal and Professional
Services 120 124 127
Licenses
120 126 132
Office Expense
120 124 127
Rent or Lease --
Vehicles, Machinery, 120 124 127
Equipment
Rent or Lease -- Other
Business Property 120 124 127
Repairs and
Maintenance 120 126 132
Supplies
120 124 127
Travel, Meals and
Entertainment 120 124 127
Utilities
120 124 127
Miscellaneous
120 124 127
Total Operating € 0% € 0% € 0%
Expenses 1,800 1,861 1,925
Income (Before Other € 15% € 15% € 15%
Expenses) 1,80,805 2,41,264 3,14,138
Other Expenses
Depreciation
15,643 15,643 15,643
Commercial Loan
6,139 5,325 4,469

36
Total Other Expenses € 2% € 1% € 1%
21,782 20,968 20,112
Net Income Before € 13% € 14% € 14%
Income Tax 1,59,023 2,20,297 2,94,027
Income Tax € € €
47,707 - -
Net Income/Loss € 9% € 14% € 14%
1,11,316 2,20,297 2,94,027

Break Even Analysis

Gross Margin % of Sales
Gross Margin € 2,40,000
Total Sales € 12,00,000
Gross Margin/Total Sales 20.0%
Total Fixed Expenses
Payroll € 57,395.50

Operating Expenses € 23,581.53

Operating + Payroll € 80,977

Breakeven Sales in Euros (Annual)
Gross Margin % of Sales 20.0%

Total Fixed Expenses € 80,977

Yearly Breakeven Amount € 4,04,885

Monthly Breakeven Amount € 33,740

37
 Cash flow of three years

FY1 cash flow

Month Month Month Month 4 Month Month 6 Month 7 Month Month Month Month Month Totals
1 2 3 5 8 9 10 11 12
Beginning € € € € € € € € € € € €
Balance 25,00 28,23 41,45 42,784 56,01 69,244 70,554 83,78 97,01 98,309 1,11,5 1,24,76
0 0 9 4 4 3 39 8
Cash Inflows
Cash Sales €
50,00 50,00 50,00 50,000 50,00 50,000 50,000 50,00 50,00 50,000 50,00 50,000 6,00,00
0 0 0 0 0 0 0 0
Accounts €
Receivable - 50,00 50,00 50,000 50,00 50,000 50,000 50,00 50,00 50,000 50,00 50,000 5,50,00
0 0 0 0 0 0 0
Total Cash € € € € € € € € € € € €
Inflows 50,00 1,00,0 1,00,0 1,00,00 1,00,0 1,00,00 1,00,00 1,00,0 1,00,0 1,00,00 1,00,0 1,00,00 €11,50,
0 00 00 0 00 0 0 00 00 0 00 0 000

Cash Outflows
Cost of Goods €
Sold 40,00 80,00 80,00 80,000 80,00 80,000 80,000 80,00 80,00 80,000 80,00 80,000 9,20,00
0 0 0 0 0 0 0 0
Operating €
Expenses 150 150 150 150 150 150 150 150 150 150 150 150 1,800
Payroll €
4,783 4,783 4,783 4,783 4,783 4,783 4,783 4,783 4,783 4,783 4,783 4,783 57,396
Taxes €
- - 11,90 - - 11,919 - - 11,93 - - 11,949 47,707
4 4
Loan €
Payments 1,837 1,837 1,837 1,837 1,837 1,837 1,837 1,837 1,837 1,837 1,837 1,837 22,049
Total cash €467 €86,7 €98,6 €86,77 €867 €98960 €86770 €867 €987 €86770 €867 €98720
outflows 70 70 75 0 70 70 04 70
Net cash €323 €132 €132 €13230 €132 €1310 €13230 €132 €129 €13230 €132 €1280 €10104
flows 0 30 5 30 30 6 30 9
Operating €282 €414 €427 €56014 €692 €70554 €83784 €970 €983 €11159 €124 €12604
cash balance 30 59 84 44 13 09 768 9
Ending cash €282 €414 €427 €56014 €692 €70554 €83784 €970 €983 €11159 €124 €12604
balance 30 59 84 44 13 09 768 9

38
 FY2 Cash flow

Month Month Month 3 Month 4 Month Month 6 Month Month 8 Month Month Month Month Year 2
1 2 5 7 9 10 11 12 Totals
Beginnin € € € € € € € € € € € €
g 1,26,0 1,41,3 1,59,58 1,77,85 1,96,1 2,14,38 2,32,6 2,50,92 2,69,1 2,87,4 3,05,72 3,23,99
Balance 49 17 5 3 20 8 56 4 92 60 8 6
Cash €
sales 65,000 65,00 65,000 65,000 65,00 65,000 65,00 65,000 65,00 65,00 65,000 65,000 7,80,00
0 0 0 0 0 0
Accounts €
receivabl 50,000 65,00 65,000 65,000 65,00 65,000 65,00 65,000 65,00 65,00 65,000 65,000 7,65,00
e 0 0 0 0 0 0
Total € € € € € € € € € € € € €
cash 1,15,0 1,30,0 1,30,00 1,30,00 1,30,0 1,30,00 1,30,0 1,30,00 1,30,0 1,30,0 1,30,00 1,30,00 15,45,0
inflow 00 00 0 0 00 0 00 0 00 00 0 0 00
Cost of €
goods 92,000 1,04,0 1,04,00 1,04,00 1,04,0 1,04,00 1,04,0 1,04,00 1,04,0 1,04,0 1,04,00 1,04,00 12,36,0
sold 00 0 0 00 0 00 0 00 00 0 0 00

Operatin €
g 155 155 155 155 155 155 155 155 155 155 155 155 1,861
expenses
payroll €
5,740 5,740 5,740 5,740 5,740 5,740 5,740 5,740 5,740 5,740 5,740 5,740 68,875

Loan €
payments 1,837 1,837 1,837 1,837 1,837 1,837 1,837 1,837 1,837 1,837 1,837 1,837 22,049
Total € € € € € € € € € € € € €
cash 99,732 1,11,7 1,11,73 1,11,73 1,11,7 1,11,73 1,11,7 1,11,73 1,11,7 1,11,7 1,11,73 1,11,73 13,28,7
outflows 32 2 2 32 2 32 2 32 32 2 2 85
Net cash € € € € € € € € € € € € €
flow 15,268 18,26 18,268 18,268 18,26 18,268 18,26 18,268 18,26 18,26 18,268 18,268 2,16,21
8 8 8 8 8 5
Operatin € € € € € € € € € € € €
g cash 1,41,3 1,59,5 1,77,85 1,96,12 2,14,3 2,32,65 2,50,9 2,69,19 2,87,4 3,05,7 3,23,99 3,42,26
balance 17 85 3 0 88 6 24 2 60 28 6 4
Ending € € € € € € € € € € € €
cash 1,41,3 1,59,5 1,77,85 1,96,12 2,14,3 2,32,65 2,50,9 2,69,19 2,87,4 3,05,7 3,23,99 3,42,26
balance 17 85 3 0 88 6 24 2 60 28 6 4

39
 FY3 CASH FLOW

Month Month Month 3 Month Month Month Month 7 Month 8 Month Month 10 Month Month 12 Year 3
1 2 4 5 6 9 11 Totals
Beginning € € € € € € € € € € € €
balance 3,42,2 3,62,7 3,87,04 4,11,3 4,35,7 4,60,0 4,84,40 5,08,75 5,33,0 5,57,431 5,81,7 6,06,113
64 05 6 86 27 68 9 0 90 72

Cash sales €
84,50 84,50 84,500 84,50 84,50 84,50 84,500 84,500 84,50 84,500 84,50 84,500 10,14,0
0 0 0 0 0 0 0 00
Accounts €
receivable 65,00 84,50 84,500 84,50 84,50 84,50 84,500 84,500 84,50 84,500 84,50 84,500 9,94,50
0 0 0 0 0 0 0 0
Total €
cash 1,49,5 1,69,0 1,69,00 1,69,0 1,69,0 1,69,0 1,69,00 1,69,00 1,69,0 1,69,000 1,69,0 1,69,000 20,08,5
inflows 00 00 0 00 00 00 0 0 00 00 00
Cash
Outflows
Cost of €
goods 1,19,6 1,35,2 1,35,20 1,35,2 1,35,2 1,35,2 1,35,20 1,35,20 1,35,2 1,35,200 1,35,2 1,35,200 16,06,8
sold 00 00 0 00 00 00 0 0 00 00 00

Operating €
expenses 160 160 160 160 160 160 160 160 160 160 160 160 1,925
Payroll €
7,461 7,461 7,461 7,461 7,461 7,461 7,461 7,461 7,461 7,461 7,461 7,461 89,537
Loan €
payments 1,837 1,837 1,837 1,837 1,837 1,837 1,837 1,837 1,837 1,837 1,837 1,837 22,049
Total cash € € € € € € € € € € € € €
outflows 1,29,0 1,44,6 1,44,65 1,44,6 1,44,6 1,44,6 1,44,65 1,44,65 1,44,6 1,44,659 1,44,6 1,44,659 17,20,3
59 59 9 59 59 59 9 9 59 59 10
Net cash € € € € € € € € € € € € €
flows 20,44 24,34 24,341 24,34 24,34 24,34 24,341 24,341 24,34 24,341 24,34 24,341 2,88,19
1 1 1 1 1 1 1 0
Operating € € € € € € € € € € € €
cash 3,62,7 3,87,0 4,11,38 4,35,7 4,60,0 4,84,4 5,08,75 5,33,09 5,57,4 5,81,772 6,06,1 6,30,454
balance 05 46 6 27 68 09 0 0 31 13
Ending € € € € € € € € € € € €
cash 3,62,7 3,87,0 4,11,38 4,35,7 4,60,0 4,84,4 5,08,75 5,33,09 5,57,4 5,81,772 6,06,1 6,30,454
balance 05 46 6 27 68 09 0 0 31 13

40
 NET PROFIT/LOSS

Mon Mont Mont Mont Month Mont Mont Month Month Month Month Month Annual
th 1 h2 h3 h4 5 h6 h7 8 9 10 11 12 Totals
Revenu
e
ABC €
1,00 1,00,0 1,00,0 1,00,0 1,00,00 1,00,0 1,00,0 1,00,00 1,00,00 1,00,00 1,00,00 1,00,00 12,00,00
,000 00 00 00 0 00 00 0 0 0 0 0 0
Total € € € € € € € € € € € € €
Revenu 1,0 1,00, 1,00, 1,00, 1,00,00 1,00, 1,00, 1,00,00 1,00,00 1,00,00 1,00,00 1,00,00 12,00,00
e 0,0 000 000 000 0 000 000 0 0 0 0 0 0
00
ABC €
80,0 80,00 80,00 80,00 80,000 80,00 80,00 80,000 80,000 80,000 80,000 80,000 9,60,000
00 0 0 0 0 0
Total € € € € € € € € € € € € €
Cost of 80, 80,00 80,00 80,00 80,000 80,00 80,00 80,000 80,000 80,000 80,000 80,000 9,60,000
Goods 000 0 0 0 0 0
Sold
Gross € € € € € € € € € € € € €
Margin 20, 20,00 20,00 20,00 20,000 20,00 20,00 20,000 20,000 20,000 20,000 20,000 2,40,000
000 0 0 0 0 0
Payroll € € € € € € € € € € € € €
4,7 4,783 4,783 4,783 4,783 4,783 4,783 4,783 4,783 4,783 4,783 4,783 57,396
83
Adverti €
sing 10 10 10 10 10 10 10 10 10 10 10 10 120
Car €
and 10 10 10 10 10 10 10 10 10 10 10 10 120
Truck
Expens
es
Commi €
ssions 10 10 10 10 10 10 10 10 10 10 10 10 120
and
Fees
Contra €
ct 10 10 10 10 10 10 10 10 10 10 10 10 120
Labour
(Not
include
d in
payroll
)
Insura €
nce 10 10 10 10 10 10 10 10 10 10 10 10 120
(other
than
health)
Legal €
and 10 10 10 10 10 10 10 10 10 10 10 10 120
Profess
ional
Service
s
License a €
s 10 10 10 10 10 10 10 10 10 10 10 10 120
Office €
Expens 10 10 10 10 10 10 10 10 10 10 10 10 120
e

41
Rent or €
Lease -- 10 10 10 10 10 10 10 10 10 10 10 10 120
Vehicle
s,
Machin
ery,
Equip
ment
Rent or €
Lease -- 10 10 10 10 10 10 10 10 10 10 10 10 120
Other
Busine
ss
Proper
ty
Repair €
s and 10 10 10 10 10 10 10 10 10 10 10 10 120
Mainte
nance
Supplie €
s 10 10 10 10 10 10 10 10 10 10 10 10 120
Travel, €
Meals 10 10 10 10 10 10 10 10 10 10 10 10 120
and
Enterta
inment
Utilitie €
s 10 10 10 10 10 10 10 10 10 10 10 10 120
Miscell €
aneous 10 10 10 10 10 10 10 10 10 10 10 10 120
Total € € € € € € € € € € € € €
Operati 150 150 150 150 150 150 150 150 150 150 150 150 1,800
ng
Expens
es
Income € € € € € € € € € € € € €
(Before 15, 15,06 15,06 15,06 15,067 15,06 15,06 15,067 15,067 15,067 15,067 15,067 1,80,805
Other 067 7 7 7 7 7
Expens
es)
Deprec €
iation 1,30 1,304 1,304 1,304 1,304 1,304 1,304 1,304 1,304 1,304 1,304 1,304 15,643
4
Interes
t
Comme €
rcial 542 536 531 525 520 514 509 503 498 492 487 481 6,139
Loan
Total €
Other 1,84 1,840 1,834 1,829 1,824 1,818 1,813 1,807 1,801 1,796 1,790 1,785 21,782
Expens 5
es
Net € € € € € € € € € € € € €
Income 13, 13,22 13,23 13,23 13,244 13,24 13,25 13,260 13,266 13,271 13,277 13,282 1,59,023
Before 222 7 3 8 9 5
Income
Tax
Income € € € € € € € € € € € € €
Tax 3,96 3,968 3,970 3,971 3,973 3,975 3,976 3,978 3,980 3,981 3,983 3,985 47,707
7
Net € € € € € € € € € € € € €
Profit/L 9,2 9,259 9,263 9,267 9,270 9,274 9,278 9,282 9,286 9,290 9,294 9,298 1,11,316
oss 55

42
 FY1 Sales Forecast

Product Month Month 7 Month 8 Month 9 Month Month Month Annual Category Category
Lines 1-month 10 11 12 Totals Breakdown / Total
6
ABC
units Sold 1,000 1,000 1,000 1,000 1,000 1,000 1,000 12,000 100.0%
Total Sales € 100.0% 100.0%
1,00,000 1,00,000 1,00,000 1,00,000 1,00,000 1,00,000 1,00,000 12,00,000
Total COGS € 80.0% 100.0%
80,000 80,000 80,000 80,000 80,000 80,000 80,000 9,60,000
Total € 20.0% 100.0%
Margin 20,000 20,000 20,000 20,000 20,000 20,000 20,000 2,40,000
Total Units 1,000 1,000 1,000 1,000 1,000 1,000 1,000 12,000
Sold
Total Sales € € € € € € € €
1,00,000 1,00,000 1,00,000 1,00,000 1,00,000 1,00,000 1,00,000 12,00,000
Total Cost € € € € € € € €
of Goods 80,000 80,000 80,000 80,000 80,000 80,000 80,000 9,60,000
Sold
Total € € € € € € € €
Margin 20,000 20,000 20,000 20,000 20,000 20,000 20,000 2,40,000

FY2 Sales Forecast

Product Month Month 7 Month 8 Month 9 Month 10 Month Month Year 2 Category Categor
Lines 1- 11 12 Totals Breakdow y / Total
month 6 n
ABC
units 1,300 1,300 1,300 1,300 1,300 1,300 1,300 15,600 100.0%
Sold
Total 1,30,000 1,30,000 € 100.0% 100.0%
Sales 1,30,000 1,30,000 1,30,000 1,30,000 1,30,000 15,60,00
0
Total 1,04,000 1,04,000 € 80.0% 100.0%
COGS 1,04,000 1,04,000 1,04,000 1,04,000 1,04,000 12,48,00
0
Total 26,000 26,000 € 20.0% 100.0%
Margin 26,000 26,000 26,000 26,000 26,000 3,12,000

Total 1,300 1,300 1,300 1,300 1,300 1,300 1,300 15,600

Units
Sold
Total € € € € € €
Sales 1,30,00 1,30,00 €1,30,00 1,30,000 €1,30,00 1,30,00 1,30,00 15,60,00
0 0 0 0 0 0 0
Total € € € € € €
Cost of 1,04,00 1,04,00 €1,04,00 1,04,000 €1,04,00 1,04,00 1,04,00 12,48,00
Goods 0 0 0 0 0 0 0
Sold
Total € € € € € € € €
Margin 26,000 26,000 26,000 26,000 26,000 26,000 26,000 3,12,000

43
 FY3 Sales Forecast
Product Month 1- Month 7 Month 8 Month 9 Month 10 Month Month Year 3 Category Category
Lines month 6 11 12 Totals Breakdown / Total
ABC
units 1,690 1,690 1,690 1,690 1,690 1,690 20,280 100.0%
Sold 1,690
Total 1,69,000 1,69,000 1,69,000 1,69,000 € 100.0% 100.0%
Sales 1,69,000 1,69,000 1,69,000 20,28,000
Total 1,35,200 1,35,200 1,35,200 1,35,200 € 80.0% 100.0%
COGS 1,35,200 1,35,200 1,35,200 16,22,400
Total 33,800 33,800 33,800 33,800 € 20.0% 100.0%
Margin 33,800 33,800 33,800 4,05,600

Total 1,690 1,690 1,690 1,690 1,690 1,690 1,690 20,280

Units
Sold
Total € € € €
Sales €1,69,000 €1,69,000 €1,69,000 1,69,000 €1,69,000 1,69,000 1,69,000 20,28,000
Total € € € €
Cost of €1,35,200 €1,35,200 €1,35,200 1,35,200 €1,35,200 1,35,200 1,35,200 16,22,400
Goods
Sold
Total € € € € € € € €
Margin 33,800 33,800 33,800 33,800 33,800 33,800 33,800 4,05,600

44
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