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Royal Stitch

Business Plan

Pearl Continental Hotel, PIDC, Karachi

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Acknowledgement

I thank the Almighty for giving us the strength and persistence to complete this report. The many
friends and family members who have contributed directly or indirectly to the completion of this
report; I am thankful for their support, which helped me stay focus.

Special thanks to our teacher Mr. Mir Asghar Ali who has been very kind and helpful with us
throughout the semester. Due to his keen words and the way of teaching, he inspired us in
countless different ways.
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Executive Summary:
Mission: mission is to provide the unique style to every
Management: FSK & ZS
client.
CO.
Description: Royal Stitch is an upscale women's clothing boutique that
will open in August 2010. Royal Stitch that means, "Honor" defines the
Contact: boutique and its essence of inclusion. Royal Stitch clothing selections and
exclusive personal style services, which include a detailed Style
Assessment, will ensure that our customers are well dressed.
Admin Dept

Karachi
Products/Services: Royal Stitch will carry Ready-to-Wear (RTW)
designer, formal, casual, party wear and especially bridal apparel for
women. Royal Stitch will feature other choice selections by Pakistani’s
traditional and western females taste such as Shalwar Kurta, Weekend
URL:http://iqra.edu.pk Maxi and short dresses for party wear, Designer Tops in casual collection.
Unique & innovative Royal Stitch will provide services such as Style
Assessments, alterations, personal shopping, and special ordering to
customers during store hours and by personal appointments. Style
Concierges who are trained within the image industry will be available to
Advisors/Board customers on a daily basis. Royal Stitch's innovative Style Assessments
Members: and educational emphasis in helping women develop their personal styles
will enhance our reputation as a truly unique boutique.

Markets: The Royal Stitch customer is a busy professional woman, university student, rich housewives who lives in the
Metropolitan City of Pakistan “Karachi” with a household income over _____. She enjoys the boutique fashions and
wants a place where she can get unique style meet her lifestyle need.

Competition: Royal Stitch has stiff local competition with the many wonderful boutiques in Karachi. Direct competitors
include those boutiques that carry some of the concepts that Royal Stitch plans on carrying or could move easily into
carrying, and are located in the Valley. Indirect competitors are those boutiques in Karachi that focus on a different target
market or do not focus on unique design that Royal Stitch will carry, in addition to well-known boutiques in other
metropolitan areas.

Financial Projections:

FY 2010-11 FY 2011-12 FY 2012-13 FY 2013-14 FY 2014-15

Sales 11,573,283 14,977,190 19,769,890 27,183,599 43,856,206

Net Profit 206,853 3,561,923 5,865,050 9,536,261 18,073,279

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General Company Description

We are in a Business of Boutique in which we design clothes for women and each design
will be unique Each design is original, focusing on individual style, each person
privileged as our unique royal pattern having their own personal authentic design with no
duplicate "royal stitch patronizing royalty Initially launching only in Karachi, we will
have four outlets, one each in the major 5 star hotels of the city (Pearl Continental,
Marriot, Sheraton and Avari) but in the beginning we will only set up the PC outlet and
once it works out then we will invest on the rest.
The basic maintained theme of our outlets will be personified with the color pink; the
decor shall be of light colored walls supported with diamond-like stones and curtains.
Each outlet will have a fairly sized lounged that will include beverages and refreshments
for the waiting customers. Soft soothing music will accompany the ambience of the
shops.

Mission Statement:

The mission of Royal Stitch is to provide uniqueness to every woman. We never

comprise towards the style and individualistic of our every single client.

Company Goals and Objectives

Royal Stitch goal is to take a place of Bejan in US.

Legal form of ownership: Partnership

Products and Services

Our shop will have four types of clothing lines casuals, formals, party wear and bridal.
The clothes in our shop will not have any duplicates, just one piece; if bought by a
customer, there won’t be a spare lot and will not be designed again. This way each of our
customers will have a unique piece of clothing that no other will share anywhere. This is
the driving selling proposition that we shall market.
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Marketing Plan

Market research - Why?

In the Questionnaire we asked questions that if you get a chance to wear a dress which is
unique and nobody can have it so most of the ladies said yes, so through small survey we
identified the need of such boutique which should offer dresses to its clientele which no one
else can have it.

a. Market Size:

We have a market size of approximately 300,000 females from the age group of 15-
50.

b. Market Share:

Being very realistic we are targeting 1% of our total target market, which is 50,000,
due to the fact that has to be considered like, is the target audience aware of our
product and do they believe on us.

c. Consumer Analysis (Current situation)

Nature of buying decision: Usually the buying decisions of women in this case are very
choosy. Customers are mostly likely to make a purchase while they find something very
different when they come across such boutique outlets; otherwise previously visited
customers who have made purchases tend to turn into retention. If we are to properly
differentiate these two natures of buying; the casual and semi formal clothes are usually
bought out of uniqueness and party wear, formal and bridal clothes require the customers to
make prolonged periods of decision making time.

d. Barriers in entering this market with the new company:

• High marketing costs

• Consumer acceptance and brand recognition

• Unique technology and patents

e. Solution to these Barriers:

• Use resources efficiently so that there will no wastage on unnecessary marketing.

• Organizing events to develop clientele acceptance for our product. Going into universities
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arranging fashion shows.

• We don’t publish our catalog so that no one can copy our designs, plus we also save our
cost by not making copyrights of these designs.

Product from the client:

Royal Stitch will carry from Ready-to-Wear (RTW) and made to order suits of different designs, diffusion
lines and casual, formal, party wear apparel & bridal dress for women. Royal Stitch will carry four main
RTW and MTO lines (Royal Formal Collections, Royal Casual Collections, Royal Party wear & Royal
Bridal Collections) these collection have sub categories with various fabrics around the world such as
Velvet, Georgette, Chiffon, Cotton, Silk, Polyester Cotton, Lillian, Crepe and Organza/

APPAREL LINES

Royal Formal Velvet Collection

Royal Formal Georgette Collection
Royal Formal Chiffon Collection
Royal Formal Cotton Collection
Royal Formal Silk Collection
Royal Formal PC Collection
Royal Formal Crepe Collection
Royal Formal Organza Collection
Royal Casual Cotton
Royal Casual Lillian
Royal Casual Crepe
Royal Party Velvet
Royal party Silk
Royal party Crepe
Royal party Organza
Royal Bridal Fashion
Royal Traditional Bridal
Royal Classical Bridal
Royal Modern Bridal

Some of the key lines are detailed below:

Royal Formal Collections:

Royal Formal Collection is actually designed contemporary cuts to keep a different style. Detailed, delicate
and sparkling embroideries are done on luscious Velvet, Georgette, Chiffon, Cotton, Silk, PC, Crepe, and
Organza, creating the perfect evening wears for our clients. In this category we will also cater office-going
ladies by providing them subtle or bright colors to make their day perfect.

"Epitomizing elegance like no other"

Royal Casual Collections:

Royal Casual Collections is of unique cut in classic styles. They are designed in a way that there can be no
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other alternate for casual wear. Keeping the weather in mind Cotton, Lillian and crepe are used. Casual tops
will be designed that can be worn with a pair of jeans, Capri's, trousers or anything of clients choice. Royal
Collection very well knows how to dress a woman.

Royal Party Wear:

Royal party wear brings innovative ideas in party wear. Unique styles of clothing that will glamorize
evening and make our clients look the most beautiful. This category will include long sleek dresses with
different designs; it will also have short dresses. Royal collection designs are considered feminine and
elegant so we will also design according to the desire and a requirement of our clients as the attention is on
individualism.

Royal Bridal Collections:

Only once in a lifetime a girl experiences the special day of her life that is her wedding
day and we are here to make this day more special for our clients by designing a dress
that is specially made for their personality. Royal bridal collection presents an amazing
Bridal Collection, best suited for the Asian brides, enhancing the beauty and look of
innocence yet presenting a picture of elegance.

Customer and Market Research:

Market Needs
If you were to overhear women talking in a dressing room, you would more than likely hear them
comment on something they've tried on and question how they should wear it or what it will go
with in their closet. Research has shown that women are stressed, have little time to shop, and
would generally like help in determining the right clothes and styles to wear. With over 15
million1 Pakistani women between the ages of 15-49 spending over 2.43%2 out the total
consumption which is equals to 337 rupees3 in apparel each year, there are sure to be some
mistakes made in clothing choices. Television shows such as Style 360 "FYI" shows updates
regarding the current fashion and trying to reduce woman's confusion about what looks best on
her. Even women who can afford a professional stylist feel helpless and often jokingly request
that their stylist unable help them get dressed.

One gender in particular influences the majority of the retail marketplace: women. Women
comprise 48.6% (89 million) of the Pakistani population4 and control or influence. Research
indicates that women approach retail shopping uniquely by evaluating purchases based on
product and company information derived from both personal and expert sources. The table
below shows that out of the ten characteristics consumers find important in deciding where to
1
Statistics: PSLSM 07-08 PERCENTAGE DISTRIBUTION OF POPULATION BY AGE, SEX AND AREA 2007-08.

2
http://www.statpak.gov.pk/depts/fbs/statistics/hies05_06/complete.pdf (4.9% * 48.6% female population)

3
www.statpak.gov.pk/depts/fbs/statistics/hies07_08/table17.pdf (693.69*48.6%)

4
Statistics: Female Population percentages from (PSLSM 07-08 PERCENTAGE DISTRIBUTION OF POPULATION BY AGE,
SEX AND AREA 2007-08) * Population of Pakistan; 183,329,300*48.6%.
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shop, four were attributed to customer service.

Top Ten Factors in Deciding Where to Shop5:

Reason 2000 2002 Change
1. Has reasonable prices 78% 85% +7
2. Treats customers with respect 66 74 +8
3. Carries quality merchandise 66 72 +6
4. Doesn't pressure me to buy anything 61 70 +9
5. Convenient store hours 61 68 +7
6. Handles merchandise returns fairly 60 66 +6
7. I can always find what I want 61 65 +4
8. Carries a wide variety of items (e.g. colors, 57 64 +7
sizes)
9. Has outstanding customer service 55 63 +8
10. Makes it quick and easy to shop 53 61 +8

Market Size:
To check how many women purchase their outfits from boutiques for this we had several
statistics from government of Pakistan which indicates that the population of women in Karachi
is around 1.5 million and the average household expenditure on readymade garments was around
16% thus we get the idea that in 1.5 million of population around 0.23 million of population
purchases their outfit from boutiques or same type of shops.6

Market Size 1 Market Size2 Average

495,832 259,760 377,796

The above method is the one way to check the market size, thought we not stick to these statistics
we design a questionnaire and design a sample of 30 respondents from them we asked different
questions regarding their buying habits and behavior from them we get to know that from
different areas of people they rate their purchasing 55% from boutique and 45% they design their
own clothes from tailor. Thus we use that research to calculate the market size of the Karachi,

5 "Getting the Goods," May 2003

6
Percentages of population from Labor Force Survey 2007-08
Spending: http://www.statpak.gov.pk/depts/fbs/statistics/hies07_08/table17.pdf
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which is around 0.4 million.7

Industry Size:
Due to unavailability of the data we have to count the major market leaders operated in the busy
streets of Karachi, thus we get to know that approximately there are 50 big players who are
catering the need of designer wear for around 0.03 million females.

Penetration Rate:
Since there were total 1,534,319 from the age of 15-50 and there are 377,796 females currently
purchasing outfits from different boutiques so by dividing total population of females with the
females currently purchasing their outfits from boutique we get 24.6% of market penetration rate.

Small Survey Results

Customer needs, expectations and buying patterns
The Royal Stitch customer loves to shop and enjoys going to boutiques by showing their yearly expenditure
on an average has 100,000. She is knowledgeable about designer fashions and tends to shop for seasonal
wardrobes twice a year plus picks up various fashion and basic pieces throughout the year. Many times she
shops to "browse." By offering fashionable accessories and wardrobe organization items, Royal Stitch will
be able to grab a larger share of her wardrobe budget. She is used to coming into the store and browsing
through the clothing items and trying on what interests her. She expects a warm and comfortable
environment and nice dressing rooms. She enjoys being left alone but also enjoys the special touches of
personal shopping assistance and having the ability to special order items.

Market Segmentation:
Karachi is rated amongst the top Pakistani markets in economic and educational achievements. At an
average age of 21, the Karachi professional is highly affluent, with an average monthly family household
income of all the quintiles is 12,326 Rs.8 According to our small survey of 30 respondent we found that
Close to 50% are studying and 17% are housewife, 13% have running their own business and 20% are
working women. The clothing market can be segmented into various sectors of customers who differ in
style, color and cloth preferences. These people can be safely segregated from demographics involving the
ages of 15 to 50 particularly talking about the female customer base. The young girls from the age span of
15 to 20 adopts a preference of a specific palette of colour range that includes bright and playful colors for
example shades of yellow, shocking pink and shades of light green. This segment prefers a more
contemporary mode of clothing that involves jeans, skirts, frocks and trendy variations of shalwar kameez
The segment that follows from the ages of 21 to 25 categorizes those girls who adopt the clothing involving
the same types of the younger segment but keep a tendency to incline towards formal wear since a
percentage of these girls are married and workingwomen. The ages from 26 to 35 include mature women

7
Questionnaire Filled Out form Excel File sheet Name (Table 1.1 and Table 1.12)
OUTPUT of cross tabulation Excel file Sheet name (results)

8
2007-08 Household Integrated Survey
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who have the tendency to sway from various modes of clothing. They tend to either fall into a very simple
and normal mode of dressing. At some point these women start to adopt a nature of being adventurous and
experimental in their preferences. 36 to 50 and onwards is categorized as a segment that involves middle
aged married women and old matured independent ladies who are studied to be the most experimental in
their dressings. This segment does not include all the ladies of this age in the pertaining age group but only
includes the upper class social classes. The segmentation is further simplified in tabular form in the
‘”Consumer Analysis”’ section.

Demographics Age 15-50

Gender Female
Race Ethnic Group Asians.
Education Most likely students of high schools & universities or
those who have completed their academic qualifications.
Non-Educated rich mothers/wives.
Income A yearly income of 150,000 Above.
Occupations Business Executive women, student of higher education,
working women or housewives.
Religion All religions (all those who prefer trendy or modern
cloths)
Geographic Urban Residents of posh areas such as Clifton, Defence,
P.E.C.H.S & K.D.A
Segmenta Country Major is Pakistan, than all around the world.
tion
Psychographic Lifestyles Going to parties, clubs, launches, openings, etc.
(Activities & They like being in latest trends
Segmenta attitudes)
tion Personality Non-stingy, extrovert, outgoing, image conscious.

Benefits Functional The cloth material, embroidery, color, stitching and

design, quality and uniqueness.
Non-Functional Personality/Ego boost, Pride. Uniqueness will represent
every customer’s individuality.

Competitions:
Royal Stitch has stiff local competition with the many wonderful boutiques in Karachi. Direct competitors
include those boutiques that carry some of the concepts that Royal Stitch plans on carrying or could move
easily into carrying, and are located in the Valley. Indirect competitors are those boutiques in Karachi that
focus on a different target market or do not focus on unique design that Royal Stitch will carry, in addition
to well-known boutiques in other metropolitan areas.

The following are the list of potential direct and indirect competitors present in the market catering to the
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mentioned target audience.

Direct Competitors:
Outlets and designer shops will be the direct competitor of our brand since they cater to the same
target market. These shops mostly cater to customized preferences of the customers and also
release their own designs in the dressing categories.

Ego
Deepak Parwani
Aisha Varsey
Maria B
Rizwan Beig
Imran Qureshi
Stone Age
Funk Asia

Indirect competitors:
The indirect competitors include all low-end and low priced outlets including shops at Tariq
Road, Dolmen Mall and Zainab Market that cater to all classes from lower to the upper middle.

Competition Analysis:

Direct Competition
Company Name Brand Name Price Range USP
Captures all the youth
Casual 8,000-12,000
and has also has a lawn
Maria B Maria B Party 9000-30,000
company with the same
Formal 23,000-100,000
brand name.
They come up with new
clothing range every
Casual week and they don’t
Ego Ego
1550-2750 repeat previous designs
again.

He arranges various
fashion shows in
Deepak Casual
Deepak Perwani foreign countries and
Perwani 3000-8000
has a great brand name
for upper upper class.
Is known for all white
range in clothing and
Aisha Varsey Aisha Varsey
she herself wears white
all the time.
Has a great back of
Amir Adnan and it
Funk Asia Funk Asia
captures all the upper
class youth girls.
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has private clients and

often deals with
Imran Qureshi
Karachi and Pakistan
Fashion Week

has private clients and

often deals with
Rizwan Beig
Karachi and Pakistan
Fashion Week

In-Direct Competition
Company Name Brand Name Tag Line USP
Stone age Stone age Targets youth majorly
Known for making
colorful cloths, captures
youth as well as other
Nomi ansai Nomi ansari
age groups and deals
with part and bridal
wear.
All those boutiques
Could be any and also
that share a certain
those who can try
percentage of market Could be any Could be any
copying our idea and
share in our target
designs.
market.

Target Market:
Demographics
• Female.
• Spending 86% of their household income.
• Professional woman, Housewife, university Students and Students of O and A Levels
(age 15-50)
• Household income over
• College-educated and currently studying
• Lives in a higher-income Karachi Neighborhood. Defence, Clifton, Johar, Gulshan and
PECHS.

Psychographics

• Looks for something new, willing to spend money on quality, core items
• Would like more time or help in understanding what clothing is right for her
• She wants to look her best because she wants to feel good about herself as well as make a
good impression at her job

Leisure Activities
• Supports the Arts
• Reads Vogue, Visgae, Pink and She
• Watches Style 360
• Internet savvy
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• Travels, owns a passport

• She enjoys eating out as well as taking time for herself at the beauty saloon or getting a
mani-pedi

Clothes Shopping Behaviors

• Spends over 100,000 for clothes each year9
• Shops at Boutiques.
• Buys mostly tops
• Looks for classic, basic items each season, with 1-2 trendy items
• She cares about how she presents herself, enjoys fashion, and looks for quality over
quantity

Niche
Our target market would be those females who lives in Defence, Clifton, Gulshan,
PECHS and they spend more than 800010 per month on readymade clothing
and they are lies in the 5th quintile of expenditure and income group.

Strategy
Based on small research conducted on women's shopping behaviors as well as our own research for
Karachi women, the following marketing strategies will be employed:

• Develop strong relationships with customers by utilizing Style Assessment and offering
services to help each woman determine the right clothes for her.

• Provide educational materials and programs that enable customer’s greater decision-
making confidence.

• Build awareness of brand and services to exemplify strong store reputation.

• Provide customers with a sense of access to "inside information" and harness the power
of a woman's personal network by leveraging marketing collateral designed for sharing
and encouraging referrals.

• Utilize personal referrals and stylists to build traffic.

Objective #1: Launch of Royal Stitch

Strategies: Build awareness of brand and services to exemplify strong store
reputation
Provide customers with a sense of access to "inside information" and
harness the power of a woman's personal network

9
Supported by our small survey of 30 respondents.

10
Supported by our survey taken the averages of spending on clothes in a year and
than divided it for months
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Utilize personal referrals and stylists to build traffic

Tactics: -
Strengthen the customer relationship via events and special
Promotion: communications
Hold two large sales a year: winter and summer
Web: Promote key merchandise & events on the website
Direct: Send out monthly email newsletter to customers. Expense*
Develop working relationships with 2-3 personal stylists
Personal Provide personal appointments
Selling: Train Style Concierges to provide exceptional service and exhibit
patience in the selling process with women
Hold Launch event/party - Invite VIPs and Karachi Socialites
Hold unique after-hours shopping events (Mother-Daughter night,
Events: Travel Planning, Girls Night Out, etc.)
Hold Fall & Spring events
Get voted as one of best places to shop on Yello and in Vogue
PR: Magazine.

Objective # - Garner In-Depth Understanding of Customers

Develop strong relationships with customers by utilizing Style Assessment
Strategies: and offering services to help them determine the right clothes for them
Provide educational materials and programs that enable customers greater
decision making confidence
Tactics: -
Promote gift giving during key holidays (Eid, Valentine's & Mother's Day)
Promotion: and utilize assessments to assist gift givers in purchasing the appropriate
gift. Expense*
Integrate style personalities and other key information into customer
Direct: database and develop customer segments
Create awareness of assessment through emails to customers
List the style personality numbers on each merchandise tag to generate
interest and awareness of the Style Assessment
In-Store: Provide overview of Style Assessment in dressing rooms
Tailor merchandise offerings to specific Style personalities
Events: Hold monthly Style Assessment workshops. Expense*
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Marketing Plan
Marketing Strategy
Positioning Statement
Royal Stitch provides women with upscale designer clothing and exclusive personal services. Our main
competitive advantage is the unique Style helping women develop their personal style.

Brand Positioning
'Royal Stitch' is Pakistani Mughal image. Building on the meaning of "Royal," Prestige will memorize the
pride of Mughal Emperor, which defines the boutique, and its essence of inclusion. Style Studio is added to
the overall name to suggest that women can come to the boutique to learn about themselves and experiment
with their personal style. By combining these two meanings, Royal Stitch Style Studio semms to be the
leader in providing exceptional service and assistance for women's fashion needs. The elegance of the name
suggests the types of clothing and accessories that will be featured.

BRAND PERSONALITY

Innovative | Stylish | Contemporary | Modern | Fresh | Approachable | Elegant | Cultural

The overall brand personality of Royal Stitch aspires to be fashionable, customer-oriented, innovative,
refreshing, stylish and educational. The boutique is a place where women can go to transform themselves
with beautiful clothes and take advantage of the Style Assessment and other services that help them
determine the right clothes for their unique selves. We are a shop that educates. We help women learn
about the designers, gather with their friends, and have fun during the process. We not only carry items that
help them look good, but we also help our customers maintain these items.

Promotional Plan:
With respect to our strategies from which we make objective, our launch will start with
teasers around the city in the form of billboards on major locations of the city. This will
then be followed by a main billboard design that will have our advertising message and
original color theme. Press and Magazine advertising shall at once be our first
advertising campaign that shall be placed in popular magazines such as Pink, Visage,
Libaas, She, Sensation, Women’s Own and Zinq. Major newspapers such as Dawn, The
News and the Nation will contain our press ads highlighting details of our outlets.

The initial campaign shall last for 3 months after which no more advertising will be done
for our brand. Our advertising will depend on our brand champions and advocates
(satisfied customers) using the pull effort. With word of mouth and social networking
marketing, mainstream advertising will not be required. Calendar and non-calendar
based strategy for below the line activities like fashion shows will also be practiced.

Promotion Summary:
The following promotional tactics for generating buzz and awareness about Royal Stitch will be
implemented:
• Personal selling and word of mouth via networks of friends, stylists and customers
• Unique visual displays in storefront on a weekly basis
• PR (local and national)
• Boutique email newsletters
• Direct mail such as postcard notices that are targeted specifically to the customer
• Sales Promotion such as store events.
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• Royal Stitch Web Site

• Advertising will be at a minimum with regular ad placements in the Magazine’s
• Fashion Shows
• Magazines cover pages.
• Advertising on Facebook
• Affiliation with www.yellow.pk.

Other important marketing strategies, such as developing strong customer relationships (retention), will
utilize a different mix of marketing programs.

Promotional Tools
TV
Cable TV
No
Press
Dailies No
Magazines / Pink
Periodicals Visage
Libas
Women Magazine
Vogue
She
Radio
FM No
Outdoor
Hoarding Airport 30*60
Teen Talwar 20*60
Zamzama 20*60
Vehicles No
Pole Signs + No
Banners
Internet
Web Banners www.royalstitch.com expense 1100; including registration and
maintenance per year.
Others
Non Traditional
Media

BTL Communication Vehicles

Event Based
Non Calendar Participating in shows such as Pakistan fashion week and Karachi fashion
Events week, Charges are contigency
Calendar Event Arranging shows on valentines day, Eid etc. cost allocated by outside event
management company
Non Event Based
Floats, Stalls etc. No
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Budget: Monthly

Magazines City Size Position C/B&W Times Cost

Pink Khi Full page Inside Color 1.00 2000

Visage Khi Full page Inside Color 1.00 80,000

Libas Khi Full page Inside Color 1.00 80,000

Women
Magazine Khi Full page Inside Color 1.00 25,000

Vogue Khi Full page Inside Color 1.00 80,000

She Khi Full page Inside Color 1.00 25,000

Billboards Media Plan for October 2010

Area Size Cost

Airport 30*60 280,000

Teen Talwar 20*60 115,000
Zamzama 20*60 115,000
Grand Total 510,000
Total with 16% GST 591600

Other Expenses Budget

Launch 2,000,000 Show at PC
Party
Sending 50,000
Newsletter Pricing
Promotions 100,000
Gift 55% of
Events 1,000,000

Facebook 50 dollar for 1 day: 50*83*30 for starting 1

Ad month =124,500 PKR
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respondent, which are already purchasing outfits from different boutiques with a 117 thousand income,
agree, "When we asked will you purchase an outfit which is unique and no can have it than really they want
something, as they said yes price is no object.

At Royal Stitch Style Studio, we are very committed to bringing high quality clothing to women and the
prices will reflect a range of mid-to-high pricing. Average price points will be around

7,950
Formal
1,250
Casual
4,850
Party Wear
81,250
Bridal

Location
It is recommended that the proposed location for the said enterprise be a posh area, where
people have the buying capacity for women fashion wear. As the idea of business is very
unique Royal Stitch Style Studio will be located in an upscale neighborhood in Karachi.
A significant proportion of the target market lives in this area. Royal stitch will work with
the local merchants association as well as local publications to generate PR and shopping
in the neighborhood. Royal Stitch will also attract women from throughout other Karachi
neighborhoods as well as the few women who come to Karachi from out of town to shop.
As we don’t need to have random customers we have chosen Pearl Continental Hotel as a
location a shop will be taken there on rent. The size of the shop would be at least 300
Sq.ft approximately 20 feet front and 15 feet depth. Furthermore, a small place will be
required to establish the stitching unit. One viable option is to rent a small place for this
purpose because the stitching cannot be done in PC as it will only be our selling point.
The shop will be obtained on rental basis, and the rent for the shop is Rs. 125 per sq.ft
that is 37500 and 16 percent GST will be charged on the rent that will be 6000.
According to the prevailing practice, six months rent as security, as security would be
required for renting the shop so security deposit will be given and one month rent. It is
assumed that security deposit is a one-time expenditure whereas rent will be paid on
monthly basis.

The cost estimates for setting up the Boutique are as follows:

Security for renting shop is 6 months rent (Rent Rs.37,500 per month plus 261,000
16% * 6 months rent as security)

Interior decoration (installing lighting, mannequins, hanging racks, mirrors, 500,000

glass panes, cash counter, and other furnitures, etc.)
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Rent for the stitching unit (Rent @ Rs30,000 per month) 30,000

Shop and Stitching unit Design

The project will have the following infrastructure components:

INFRASTRUCTURE REQUIREMENTS Sq .fts

Main shop covered area 300
Try room 10 (2rooms)
Shop floor 280
Building for stitching unit 1000

PRODUCTION PROCESS FLOW:

The process for converting fabric in designer wear garments follows the below mentioned
sequence:

Design:

The initial process starts from the designing phase. Various patterns of clothing and the fashions
in vogue, which also relate to the tastes of the concerned clientele, are designed. The contracted
designer as does this he/she will provide the basic designs of which the fabric will be converted
into the designer wear garment. On average, a designer is supposed to provide 40 designs per
month or 100-120 designs per season i.e. three months. From these designs, approximately 50%
of the designs are selected for further development of clothes.

Pattern Making/Cutting:

Based on the designs selected, patterns for cutting are developed and based on these patterns,
fabric is cut, embodied, block printed, and processed accordingly.

Stitching:
The cutting is followed by stitching of fabric, which can either be done by the in-house stitching
unit or by outsourcing it.

Labeling

Labels are also attached to the apparels in the process of stitching.

 Page 20 of 53

Finishing:

The final phase is that of finishing, in which the garment will be checked for quality control and
will cleaned (if required) for final presentation at the outlet. The garments will also be tagged for
identification of sizes, prices, addresses, handling instructions, etc.

Presentation/Market:

Once the designer wears garment is ready after going through the above-mentioned process, it is
presented at the outlet/shop for sale to the clientele.

Pattern making /
cutting Stitching

Market / Clientele Presentation

Human Resource Plan

Introduction
We will be recruiting and selecting people who are well qualified and possess numerous skills
within their respective fields. They will be working on our predefined quality assurance
standards. There will be strict policies on which we will shortlist applied candidate and finally
form a proper workforce.

Employment structure Year 1, 2 3, 4 & 5)

Employee Structure in Royal Stitch Style Studio:

H.R Plan
Employees Cost Per
Required Employee Total
Sales 1 7000 7000 Per
 Page 21 of 53

representative Month
1500 Per
Manager 1 15000 0 Month
1200 Per
Purchaser 1 12000 0 Month
4000 Per
Designer 1 40,000 0 Month
1200 Per
Accountant 1 12,000 0 Month
3500 Per
Tailor 1 35000 0 Month
Per
Peon 1 6000 6000 Month

Job Descriptions:
Sales representative:

Job Description

The main task of a sales representative is to sell the products design by the boutique.

Essential Duties
• A sales representative must perform the following duties and responsibilities:

• Solicit orders from new and prospective customers in a certain geographical area

• Provide samples, and illustrations of the company's product line

• Handle product inquiries of clients

• Listen to customer concerns
• Address product-related issues
• Enlarge client base by developing excellent customer relations
• Survey, analyze and prepare proposals for new prospects and old clients

Manager

Job of the manager is to resolve the problems, which a customer may have. Keep a check on
the employees.

Essential Duties:
 Page 22 of 53

• Supervise Maintenance and keep a check on overall performance of other

employees and security guards.
• Cash inflow and out flow management.
• Feedback from customers
• Lead and motivate all employees
• Control any crisis situations.

Experience:

Minimum two years of experience in a customer service centre with good communication
skills and appearance.

Knowledge and skills required:

• Self Motivator.
• Communication Skills

Education:

Bachelors with Cambridge schooling.

Accountant

Accountant should have a perfect knowledge of keeping the books of accounts and posses a
suitable degree of Accountancy.

Key Responsibilities:

• To keep the proper books of accounts.

• To keep an account of the daily cash expenses and ( Cash inflows and Out flows)
• To make all the financial statements required
• Making bills

Qualification:

• Must possess an Bachelors degree (B.COM).

Peon:

He will be serving Tea, Coffee and snacks to the customers

Designer:

Designing the clothes and materialize her imaginations for the customers that have unique sense
of styling.
 Page 23 of 53

Tailor:

He will be stitching the clothes as directed by the designer , he will be available all day so that if
there is any alteration he can alter it for the customer.

Purchaser:

The purchaser will be getting everything from the market for the clothes for example laces ,
buttons , fabric , cloth dying etc.

Recruitment procedure

Every candidate will go through a comprehensive test regarding the job nature; all of them will be
tested practically and would be selected on the basis of their skills and knowledge.

Training Development:

After Selection a comprehensive training would be provided so to ensure quality standards for a
better working environment.

Critical Risk Analysis

Critical Risk Analysis    Consequenc  

ITEM Likelihood e Risk
No Clients 2 10 20

Copy of designs 2 8 16
56
Rental
Politicalinsecurity
situation 2 5 15
(Strikes) 6 6 9
3
Power Breakdown 7 8
 Page 24 of 53

No Clients:

As we did the survey and according to that 55% of ladies purchase their dresses from
boutique where as almost 95% of female responded that they would be interested if a
dress is specially made for them so there are very little chances that there will be no
clients so we took the likelihood of this situation as 2 and if it happens than of course
there will be no business so consequences is rated as 10.

Back Up plan:

High promotion and advertisements will be done so that everyone can know about our
business and come to us.

Copy of designs:

As our business is all about uniqueness so if someone gets successful in copying our
design it will be a problem for our business. so for this we will not advertise our designs
and make animated ads for our business.

Backup plan for copy of our designs:

For this problem we will not advertise our designs and make animated ads for our
business.

Rental insecurity:

As the shop is on rent so that is an insecurity that the shop might have to be vacated on
the demand of owners. As we are taking the shop in PC so they will be doing contract so
the likelihood of happening of such situation will be less so we took it 2 and if this
happens of course it will affect our business so consequences are marked as 5.

Backup plan for rent insecurity:

We will do the contract for atleast two years and if after that ye have to vacate the shop
we will shift to Marriot.

Political situation (Strikes)

As we know that in Pakistan political situations are going worst day by day so the
likelihood of its occurrence is marked 6 where as the consequences are 6 as well because
the business will remain closed and suffer loss.

Back up plan for Political situation:

 Page 25 of 53

Employees will stay at the workplace and keep working on the strikes day.

Power Breakdown:

There is a great shortage of electricity in Karachi, we won't have any problem with this
issue at the shop located in PC but the place where the production is taking place will
stop if electricity is not there. The likelihood is 7 and consequences are 8.

Backup plan for power breakdown:

We will have a complete arrangement of generator by which on only the sewing

machines will work but the relates items needed such as iron etc will also work.

Exit Strategy:
Every business has chances of having problems once it comes into existence, as our business is
not a very complicated so if it faces any problem we will have backup plan for handling the
situation. Following can be the problems that our business can face:

Copy of Designs:

As the concept of our business is uniqueness so it will be necessary for us to protect our designs
from getting copied because if they will be copied they will their value.

Changing fashion and trends:

As the fashion industry is changing day by day and new fashions are coming in so it can be
possible that if we don’t design according to changing fashions we will have to close down
because no one will be willing to buy old designs.

Culture and Environment:

As we are making clothes also for people who are modern and wear western type of clothing,
which is not our culture, so this might create a problem for us from the side of religious extremist

Political instability:

As there is a lot of political instability in our country so this might affect business by the strikes
and other issues.

Back up Plans:

Copy of Designs:

For saving our designs we will not hang all the designs in our outlet and mostly make clothes on
 Page 26 of 53

order. We will not print any catalogue or booklets through which people can copy our designs
and even the ads in the magazine will be animated so that no

One can copy our designs.

Changing fashion and trends:

As we have stepped into this business so we are prepared for this changing fashions and trends so
to overcome this problem we will be looking all upcoming and current fashion trends in detail
and design our collection according to that. Furthermore we will also send our designer abroad
for training and development.

Culture and Environment:

To save from the consequences of any party which may go against our western design we will not
advertise revealing dresses.

Political instability:

As there would be strikes due to political unrest our shop is in PC so it would hardly affect our
business and we will also tell the workers to stay in the working area and work there even if its
holiday in this way our production will not stop and we will also deliver the clothes to the client if
the situation allows us.

Fight or Flight:

As our business is not a very complicated one so the problem it will face will also be manageable
and as we have made back up plans so we will fight if any such problem arises.

Milestone:
June 01: Designing of clothes will be started.

June 30: Purchasing fixed assets of stitching unit

July 1: Stitching building

July 15: Fashion Show

July 16: Billboards & shop availability

July 17-29: Renovation of shop

July 28: Newsletters to people about opening on 1st July and others ads

Aug 1: Inauguration party Facebook ads and other promotions.

 Page 27 of 53

Financials and
Sales Figures:
Page 28 of 53
 Page 29 of 53

Initial Investment
initial Balance sheet

Assets Liabilities

Fixed Assets 1,661,300

Loan 80% 4,106,096

Cash for Marketing 3,058,100

Rent Advance 261,000

for Material 152219.9333

Capital 20% 1,026,524

Total 5,132,620 Total 5,132,620

Amortization of Loan
 Page 30 of 53

Loan Amount 4,106,096

Tenure 5

Rate 16%

Discount Factor 3.2743

Installment Amount 1254040

Formula

Year IA Interest Payments P.Remainig

0 4,106,096

1 1,254,040 656,975 597,065 3,509,031

2 1,254,040 561,445 692,595 2,816,436

3 1,254,040 450,630 803,410 2,013,025

4 1,254,040 322,084 931,956 1,081,069

5 1,254,040 172,971 1,081,069 -

 Page 31 of 53

Partners Share

Yearly Share
Equity Holder % Share 2010-2011 2011-2012 2012-2013 2013-2014 2014-2015
Partner 1 35% 359,283 72,399 1,246,673 2,052,767 3,337,691 6,325,648
Partner 2 35% 359,283 72,399 1,246,673 2,052,767 3,337,691 6,325,648
Partner 3 30% 307,957 62,056 1,068,577 1,759,515 2,860,878 5,421,984
1,026,52
Total 100% 4 206,853 3,561,923 5,865,050 9,536,261 18,073,279

Fixed Asset
Depreciatio Monthl
Stiching Asset Unit Rate Amount Life n y

Sewing Machine single needle 4 10,000 40,000 5 8,000 667

Over lock Stitch Machine 1 50,000 50,000 5 10,000 833

 Page 32 of 53

Acessories 1 50,000 50,000 5 10,000 833

Total 6 23,333 140,000 28,000 2,333

Admin Unit Rate Amount Life Depreciation Monthly

Telephone 2 2,500 5,000 2 2,500 208

Computer and Printer 1 35,000 35,000 3 11,667 972

Computer (Table and counter 1 10,000 10,000 2 5,000 417

Fire System 1 50,000 50,000 5 10,000 833

Computers for Designer 4 50,000 200,000 3 66,667 5,556

Total 9 33,333 300,000 95,833 7,986

Shop Asset Unit Rate Amount Life Depreciation Monthly

Energy Savers 80 210 16,800 2 8,400 700

Security Cameras 3 56,000 168,000 3 56,000 4,667

L.C.D 52"* 1 228,500 228,500 5 45,700 3,808

 Page 33 of 53

Sound System* 1 50,000 50,000 5 10,000 833

Shelves 3 10,000 30,000 5 6,000 500

Display Shelves 4 14,000 56,000 3 18,667 1,556

Dummy 6 8,000 48,000 5 9,600 800

Interior renovations 1 500,000 500,000 2 250,000 20,833

Suit Iron 1 70,000 70,000 4 17,500 1,458

Ac 2 27,000 54,000 3 18,000 1,500

Total 102 11,974 1,221,300 439,867 36,656

Grand Total 117 14,199 1,661,300 563,700 46,975

Expense for 2010-2011

2010-2011

manufacturing Cost Monthly Yearly % Allocation

Labor 192,000 2,304,000 100% 2,304,000

Oh 116,500 1,398,000 82% 1,140,000

Op&Selling 346,508 4,158,100 0% -

 Page 34 of 53

Depreciatio
n 36,656 439,867 80% 351,893

Total 655,008 7,860,100 44% 3,444,000

2010-2011

Cost Monthly Yearly % Allocation

Labor 192,000 2,304,000 0% -

Admin
Oh 116,500 1,398,000 18% 258,000

Op&Selling 346,508 4,158,100 100% 4,158,100

Depreciatio
n 36,656 439,867 20% 87,973

Total 655,008 7,860,100 56% 4,416,100

Expense for 2011-2012

2011-2012

manufacturing Cost Yearly % Allocation

Labor 2,534,400 100% 2,534,400

Oh 1,537,800 82% 1,254,000

Op&Selling 1,486,200 0% -
 Page 35 of 53

Depreciation 563,700 80% 450,960

Total 5,558,400 68% 3,788,400

2011-2012

Cost Yearly % Allocation

Labor 2,534,400 0% -
Admin
Oh 1,537,800 18% 283,800

Op&Selling 1,486,200 100% 1,486,200

Depreciation 563,700 20% 112,740

Total 5,558,400 32% 1,770,000

Expense for 2012-2013

2012-2013

Cost Yearly % Allocation

Labor 2,787,840 100% 2,787,840

manufacturing
Oh 1,691,580 82% 1,379,400

Op&Selling 1,534,820 0% -

Depreciatio 567,700 80% 454,160

 Page 36 of 53

Total 6,014,240 69% 4,167,240

2012-2013

Cost Yearly % Allocation

Labor 2,787,840 0% -
Admin
Oh 1,691,580 18% 312,180

Op&Selling 1,534,820 100% 1,534,820

Depreciatio
n 567,700 20% 113,540

Total 6,014,240 31% 1,847,000

Expense for 2013-2014

2013-2014

Cost Yearly % Allocation

Labor 3,066,624 100% 3,066,624

manufacturing
Oh 1,860,738 82% 1,517,340

Op&Selling 1,588,302 0% -

Depreciatio 567,700 80% 454,160

 Page 37 of 53

Total 6,515,664 70% 4,583,964

2013-2014

Cost Yearly % Allocation

Labor 3,066,624 0% -
Admin
Oh 1,860,738 18% 343,398

Op&Selling 1,588,302 100% 1,588,302

Depreciatio
n 567,700 20% 113,540

Total 6,515,664 30% 1,931,700

Expense for the Year 2014-2015

2014-2015

Cost Yearly % Allocation

Labor 3,373,286 100% 3,373,286

manufacturing
Oh 2,046,812 82% 1,669,074

Op&Selling 1,647,132 0% -

Depreciatio 571,700 80% 457,360

 Page 38 of 53

Total 7,067,230 71% 5,042,360

2011

Cost Yearly % Allocation

Labor 3,373,286 0% -
Admin
Oh 2,046,812 18% 377,738

Op&Selling 1,647,132 100% 1,647,132

Depreciatio
n 571,700 20% 114,340

Total 7,067,230 29% 2,024,870

Product Detail:
Product Details
Serial # Name Category Type Description Page 39 of 53

Royal Formal Valvet Valvet Used for Shirt and shalwar is from (Cotton, Silk and Gourgette) and dupatta is of (Cotton, Silk and
1 Collection Formal Type1 Gourgette)

Royal Formal Gourgette

2 Collection Formal Type2 Gourgette Used for Shirt and shalwar is from (Silk and Gourgette) and dupatta is of Gorjette

Royal Formal Shffon

3 Collection Formal Type3 Shiffon Used for Shirt plus slip (Shameez) and shalwar is from (Silk and Gourgette) and dupatta is of Shifon

Royal Formal Cotton

4 Collection Formal Type4 All Shirt, Shalwar and Duppata is from cotton

5 Royal Formal Silk Collection Formal Type5 Silk Used for Shirt plus slip (Shameez) and shalwar is from (Silk) and dupatta is of Shiffon and Gourgette

6 Royal Formal PC Collection Formal Type6 All Shirt, Shalwar and Duppata is from polyester cotton

Royal Formal Crepe

7 Collection Formal Type7 Crepe Used for Shirt and shalwar is from (Gourgette) and dupatta is of Gourgette and Shiffon

Royal Formal Organza Organza Used for Shirt plus Slip and shalwar is from Silk, Gourgette and cotton and dupatta is of Gourgette,
8 Collection Formal Type8 Silk and Shiffon

9 Royal Casual Cotton Casual Type1 Cotton Used for Top

10 Royal Casual Lillen Casual Type2 Lillen Used for Top

Serial # Name Category Type Description

11 Royal Casual Crepe Casual Type3 Crepe Used for Top

12 Royal Party Valvet Partwear Type1 Short Dress

13 Royal party Silk Partwear Type2 Mexi

14 Royal party Crepe Partwear Type3 Mexi

15 Royal party Organza Partwear Type4 Mexi

16 Royal Bridal Fashion Bridal Type1 Avg price of Fabric, Stones, Heaby Thread, Ulta Light Work

17 Royal Traditional Bridal Bridal Type2 Avg price of Fabric, Stones, Heaby Thread, Light Work

18 Royal Classical Bridal Bridal Type3 Avg price of Fabric, Stones, Heaby Thread, Medium Work

19 Royal Modern Bridal Bridal Type4 Avg price of Fabric, Stones, Heaby Thread, Heavy Work
 Page 40 of 53

Cost Summary of 1st Year:

Year1 Type1 Type2 Type3 Type4 Type5 Type6 Type7 Type8 Total Avg

Formal 2379 1832 2470 2300 1492 1492 1662 1662 15288 1911

Casual 599 696 746 2041 680

Partywear 2113 1993 1553 1773 7430 1858

Brdial 27590 27122 27122 27392 109224 27306

 Page 41 of 53

Production Capacity:
For stitching unit

From To From To Total Hours

12:30:00 PM 5:00:00 PM 5:30:00 PM 11:00:00 PM 10.00

For shop

From To From To Total Hours

12:30:00 PM 5:00:00 PM 5:30:00 PM 10:00:00 PM 9.00

Unit Per day Discription

Formal 1 0.015 13.0 Hours 260 Working hrs 1month

Casual 1 0.01 9 hours

PartyWear 1 0.01 9 hours 20 fomal in a month

 Page 42 of 53

Bridal 1 0.01 36 hours 29 Casual in a month

Total machines 4 26 days in month 29 Partywear

Maximum Production:

50% increae 50% increae

Production Year 10-11 year 11-12 year 12-13 year 13-14 year 14-15

Formal 296 296 444 444 592

Casual 416 416 624 624 832

Party Wear 347 347 520 520 693

Bridal 49 49 74 74 98

Total 1108 1108 1662 1662 2216

 Page 43 of 53

Sales Strategy:
We sale according to the demand pattern

Since we assume that 2% of our target will be our 1year customer from there it will increase

Target Market 52,497 2% 850

Year 10-11 year 11-12 year 12-13 year 13-14 year 14-15

Sales 850 1000 1200 1500 2200

Production 1108 1108 1662 1662 2216

Sales % 77% 90% 72% 90% 99%

 Page 44 of 53

Sales Units:

Summary Year 10-11 year 11-12 year 12-13 year 13-14 year 14-15

Formal 227 267 321 401 588

Casual 319 376 451 563 826

Partywear 266 313 376 469 688

Bridal 38 44 53 66 98
 Page 45 of 53

Revenue Year1:

Year 1

1. Year One Revenue Expectancy 1 2 3 4

Formal Casual PartyWear Bridal

Annual revenue per financial product PKR 1,805,615 PKR 1,063,992 PKR 2,580,181 PKR 6,123,495

Total year one product (noninterest) revenue PKR 11,573,283

3. Annual Tax Rate 35%

 Page 46 of 53

Revenue Year 2

Year 2

1. Year One Revenue Expectancy 1 2 3 4

Formal Casual PartyWear Bridal

Annual revenue per financial product PKR 2,336,678 PKR 1,376,931 PKR 3,339,057 PKR 7,924,524

Total year one product (noninterest) revenue PKR 14,977,190

3. Annual Tax Rate 35%

 Page 47 of 53

Year 3:

Year 3

1. Year One Revenue Expectancy 1 2 3 4

Formal Casual PartyWear Bridal

Annual revenue per financial product PKR 3,084,415 PKR 1,817,549 PKR 4,407,555 PKR 10,460,371

Total year one product (noninterest) revenue PKR 19,769,890

3. Annual Tax Rate 35%

 Page 48 of 53

Year 4:
Year 4

1. Year One Revenue Expectancy 1 2 3 4

Formal Casual PartyWear Bridal

Annual revenue per financial product PKR 4,241,071 PKR 2,499,129 PKR 6,060,389 PKR 14,383,010

Total year one product (noninterest) revenue PKR 27,183,599

3. Annual Tax Rate 35%

Year 5:
 Page 49 of 53

Year 5

1. Year One Revenue Expectancy 1 2 3 4

Formal Casual PartyWear Bridal

Annual revenue per financial product PKR 6,842,261 PKR 4,031,929 PKR 9,777,427 PKR 23,204,590

Total year one product (noninterest) revenue PKR 43,856,206

3. Annual Tax Rate 35%

Profit and Loss Statement:

Months Year 10-11 year 11-12 year 12-13 year 13-14 year 14-15
 Page 50 of 53

Revenues

Formal 1,805,615 2,336,678 3,084,415 4,241,071 6,842,261

Casual 1,063,992 1,376,931 1,817,549 2,499,129 4,031,929

PartyWear 2,580,181 3,339,057 4,407,555 6,060,389 9,777,427

Bridal 6,123,495 7,924,524 10,460,371 14,383,010 23,204,590

Total Sales 11,573,283 14,977,190 19,769,890 27,183,599 43,856,206

Less COGS

Formal 434,018 561,670 741,404 1,019,431 1,644,682

Casual 217,187 281,066 371,007 510,135 823,017

PartyWear 494,091 639,412 844,024 1,160,533 1,872,327

Bridal 1,028,975 1,331,615 1,757,732 2,416,881 3,899,235

Total COGS 2,174,271 2,813,763 3,714,167 5,106,980 8,239,261

Gross Profit 9,399,011 12,163,427 16,055,723 22,076,619 35,616,946

Less Expenses

Labor Cost 2,304,000 2,534,400 2,787,840 3,066,624 3,373,286

OH 1,398,000 1,537,800 1,691,580 1,860,738 2,046,812

Marketing 4,158,100 1,486,200 1,534,820 1,588,302 1,647,132

Depreciation 563,700 563,700 567,700 567,700 571,700

EBIT 975,211 6,041,327 9,473,783 14,993,255 27,978,015

 Page 51 of 53

Less Interest 656,975 561,445 450,630 322,084 172,971

EBT 318,236 5,479,882 9,023,153 14,671,171 27,805,044

less Tax 111,383 1,917,959 3,158,104 5,134,910 9,731,765

EAT/ Net Income 206,853 3,561,923 5,865,050 9,536,261 18,073,279

Balance Sheet:
 Page 52 of 53

Assets yr 2010-2011 yr 2011-2012 yr 2012-2013 yr 2013-2014 yr 2014-2015

Current Assets
Cash 3,382,748 6,788,227 11,675,859 20,022,785 36,444,302
Secuirity 261,000 261,000 261,000 261,000 261,000
Total current assets 3,643,748 7,049,227 11,936,859 20,283,785 36,705,302
Fixed (Long-Term) Assets

Other Fixed Asset 1,661,300 1,097,600 1,085,700 1,031,000 1,085,100

Depreciation 563,700 563,700 567,700 567,700 571,700
Net Worth 1,097,600 533,900 518,000 463,300 513,400

Total fixed assets 4,741,348 7,583,127 12,454,859 20,747,085 37,218,702

Total Assets 4,741,348 7,583,127 12,454,859 20,747,085 37,218,702

Liabilities and Owner's Equity

Current Liabilities
Tax Payable 9,282 159,830 263,175 427,909 810,980
Total current liabilities 9,282 159,830 263,175 427,909 810,980
Long-Term Liabilities
Long-term debt 4,106,096 3,509,031 2,816,436 2,013,025 1,081,069
Less Payment 597,065 692,595 803,410 931,956 1,081,069
Net Worth 3,509,031 2,816,436 2,013,025 1,081,069 -
Total long-term liabilities 3,509,031 2,816,436 2,013,025 1,081,069 -
Owner's Equity
Owner's Capital 1,026,524 1,223,035 4,606,862 10,178,659 19,238,107
Retained earnings 206,853 3,561,923 5,865,050 9,536,261 18,073,279
Drawings (10,343) (178,096) (293,252) (476,813) (903,664)
Owners Equity 1,223,035 4,606,862 10,178,659 19,238,107 36,407,722

Total Liabilities and Owner's Equity 4,741,348 7,583,127 12,454,859 20,747,085 37,218,702
NPV:
Initial Year 2010-2011 2011-2012 2012-2013 2013-2014 2014-2015

Investment -5132620 0 -551800 -513000 -621800 0

 Page 53 of 53

C.f from Investing Activities -5132619.933 0 -551800 -513000 -621800 0

Net profit 206,853 3,561,923 5,865,050 9,536,261 18,073,279

add: dep 563,700 563,700 567,700 567,700 571,700

Ocf 0 770,553 4,125,623 6,432,750 10,103,961 18,644,979

Increase in C.L 9,282 150,548 103,345 164,734 5,863,415

Payment of loan -597065 -692595 -803410 -931956 -1296836

NCF -5,132,620 182,770 3,031,776 5,219,685 8,714,939 23,211,558

Wacc Disc Use 17.52 1.00000 0.85092 0.72406 0.61612 0.52427 0.44611

DCF (5132620) 155523 2195197 3215947 4568959 10354887

II (5,132,620) IRR

DCF 20490513 67% 68%

NPV $15,357,893 92078.79318 -20364.82384 %+ (H.V-0) / (H.v-L.v)

IRR 67.82 Profit Index 3.99 IRR 67.82