BUSINESS PLAN

ON

“Aurum- Jwellery Designing”

Towards partial fulfillment of

Master of Business Administration (MBA)
(2018-2020)

(INSTITUTE OF MANAGEMENTSCIENCES,
LUCKNOW) UNIVERSITY OF LUCKNOW

Submitted to: Submitted by:

DR. SAURAV BANERJEE DIVYA SINGH
M.B.A.(Marketing)

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 DECLARATION

I, Divya Singh, a student of Master of Business Administration (MBA)

Programme at the Institute of Management Sciences, Lucknow hereby

declare that all the information, facts and figures used in this research

project titled “ BUSINESS PLAN ON JWELLERY DESIGNING” have been

collected by me. I also declare that this project report has been prepared by

me and the same has never been submitted by the undersigned either in

part or in full to any other University or Institute or published earlier.

This information is true to the best of my knowledge and belief.

Date: - (Divya Singh)

Place: Lucknow

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 ACKNOWLEDGEMENT

Words fail to express my sincerest gratitude to this esteemed

organization that has conferred upon us the privilege to

pragmatically convert my theoretical knowledge into practically

viable experience.

• I express my deepest sense of gratitude towards

__________________________________ for his support and guidance.

I also want to express my gratitude towards Mr. Saurav Banarjee,

for extending his guidance and knowledge without which this report
would not have been possible.
I would also thank my Institution and my faculty members without

whom this project would have been a distant reality. I also extend

my heart full thanks to my family and well wishers.

Divya Singh

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 TABLE OF CONTENTS

1. EXECUTIVE SUMMARY 3

2. THE BUSINESS 4

2.1) OBJECTIVE 4
2.2) COMPANY DESCRIPTION 4
2.3) FORM OF OWNERSHIP 4
2.4) PROPOSED HEADQUARTERS 4
2.5) FUNDING 4

3. THE MARKET
5

3.1) THE PRODUCT 5

3.2) COMPARATIVE ANALYSIS 5
3.3) LICENSE 5
3.4) MARKET ANALYSIS 5
3.5) MARKET CATERING 6
3.6) MARKETING PLAN 6
3.7) OPERATIONAL PLAN 8
3.8) ORGANISATIONAL PLAN 9
3.9) FINANCIAL PLAN 14

4. CRITICAL RISK 15

5. EXIT STRATEGY 15

6. APPENDIX 16 4
6.1) CV OF THE OWNER 16
6.2) MEMORANDUM OF UNDERSTANDING 16
6.3) OWNERSHIP AGREEMENT 16
6.4) ARTICLES OF ASSOCIATION 16
6.5) CERTIFICATE FROM POLLUTION BOARD 16

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1. EXECUTIVE SUMMARY

The purpose of this business plan is to develop a blueprint of the company's vision and
strategy and then use this plan to as a guide to develop and grow the business. This
business plan will also be used to align the various elements of the company to create a
coherent system of sustainable customer satisfaction and profitability.

The Jewelry Store “AURUM JEWELS” (AJ), will be located in 5 cities of India initially.
It is a new business. We will offer a great selection of jewelry in various designs, colors
and sizes. Our jewelry will include bracelets, bangles, necklaces, earrings and rings. AJ
will stock a wide selection of jewelry made of gold, diamond and platinum. We will offer
a service to make custom pieces for shoppers on demand. All sales for the business will
be through the stores itself.

AJ will sell jewellery through four main formats, which are uniquely positioned to
address different consumer segment needs. Firstly, ‘The Exclusives’ range offer high-end
luxury jewellery; secondly, ‘The Semi-Exclusives’ range offer stylish and sophisticated
products for the discerning consumer ; thirdly 22K and fourthly 18K range offer trendy,
fashionable and stylish products at competitive prices.

The Jewelry Store will specifically carry gold, diamond and platinum jewelry that is
designed for the professional and sociable woman. Our selection will range in various
colors, sizes and styles to meet the unique needs of the everyday woman. The jewelry
will be designed for casual, business and formal occasions.

The Jewelry Store ‘AJ’ will focus on one primary market, women. We will concentrate
our marketing efforts for the professional and sociable woman. We will sell to these
customers by suggesting styles for various outfits and occasions demonstrating our
knowledge of fashion design and customer service targeted at individual shoppers.
Customers can purchase pre-made jewelry or request a customized piece designed for 6

them at the store.

Management will rely on customer feedback and sales reports to eliminate or introduce
particular sizes, colors and styles.

In this industry trends are in our favor. Gold and diamond jewelry are popular because of
their unique natural colors and features; they are ideally suited for both informal and
formal occasions. They complement and can dress up any outfit on a woman.

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2. THE BUSINESS

2.1) OBJECTIVE

Our primary objective is to be a leading brand in the jewellery and fashion

industry and delight our customers by offering luxury wrapped in trust.

2.2) COMPANY DESCRIPTION

Aurum Jewels Limited is an unlisted public company. It was incorporated on 14 March,

2007 and is located in Chennai, Tamil Nadu. It is classified as a public limited company. The
company has three directors - Sheik Samsu Alam, Dimple Chaudhury, and others.

2.3) FORM OF OWNERSHIP

Dimple Chaudhury is the sole owner of the jewelry store AJ. She has over 20
years of experience in designing and making jewelry. She has worked for
several companies in jewelry design during her career. Most recently she has
taught jewelry making classes in the local community.

2.4) PROPOSED HEADQUARTERS

The registered office of the company is at RAHEJA TOWERS,

4TH FLOOR, UNIT No. 407, DOOR NO.177, ANNA SALAI
(MOUNT ROAD),, CHENNAI, Chennai, Tamil Nadu.

2.5) FUNDING 8
 The cost to setup AURUM JEWELS and prepare it for operation total
$56,300. Start up inventory will cost approximately $49,800. The bulk of the
expenses are the yearly rental of the AJ.
 
Start-up costs will be financed through owner investment.

3. THE MARKET

3.1) THE PRODUCT

The Jewelry Store AJ will specifically carry gold, diamond and platinum
jewelry that is designed for the professional and sociable woman. Our
selection will range in various colors, sizes and styles to meet the unique
needs of the everyday woman.

Management will rely on customer feedback and sales reports to eliminate or

introduce particular sizes, colors and styles.

Our jewelry store AJ will carry wide selection of jewelry with various styles
and price ranges. Each piece of jewelry will focus on designs which accent
and bring focus on the quality in that piece. The jewelry will be designed for
casual, business and formal occasions. We will offer jewelry that includes
necklaces, rings, bracelets, bangles and earrings.
Customers can purchase pre-made jewelry or request a customized piece
designed for them at the store.

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3.2) COMPARATIVE ANALYSIS

Some of the most well known competitors seen in the jewelry retail industry
are Damas India, Gitanjali group, Swarovski, Gold Souk, Tanishq and
Forever Mark Jewels.
Our competitive edge is that we are concentrating on the selling of platinum
jewelry as well as gold and diamond jewelry, while other competitors only
minimally focus on this type of jewelry. Our services will also include
creating custom pieces for our customers according to their design needs.

3.3) LICENSE

 Business License
 IEC No. ( Import Export Code )
 Hallmark Certified
 ISO 9001 series
 Zoning papers
 Designs patents
 Business patents

3.4) MARKET ANALYSIS

Jewelry has been one of the fastest growth areas. In today’s society, the
majority of jewelry is still sold to women, and it doesn’t look like that fact will
be changing any time soon. However, as the interest in this jewelry grows
with women, it seems that men are not far behind in finding interest in such
items as well.
One of the most trendy and fashionable types of jewelry on the market is
diamond jewelry. While various types of diamond jewelry is popular, there are
different jewelry trends each year. One year it may be considered extremely 1
0
fashionable to wear ruby earrings while the next year rubies may be out.
3.5) MARKET CATERING

There are about 28,000 specialty stores selling jewelry. The industry is highly
fragmented with the top 50 jewelry chains accounting for less than half the
total revenue. India encompasses roughly 25 % residents earning an average
household income of about Rs.400,000 and above that accounts for 50.9% of
women.

3.6) MARKETING PLAN

 MARKETING STRATEGY

We are targeting women in India. In addition, women are the primary end
consumers of jewelry, it's natural for our Jewelry Store to spend most of its
marketing resources targeting this largest market. AJ will sell jewellery
through four main formats, which are uniquely positioned to address
different consumer segment needs. Firstly, ‘The Exclusives’ range offer
high-end luxury jewelry ; secondly, ‘The Semi-Exclusives’ range offer
stylish and sophisticated products for the discerning consumer ; thirdly
22K and fourthly 18K range offer trendy, fashionable and stylish products
at competitive prices.

 DEMOGRAPHICS

 Women ( ages 18 and above )

 Sociable or professional
 Lives in a higher income group

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 Unique Selling Proposition (USP)

The Jewelry Store will offer personalized fashion consulting to our

customers with custom jewelry making service. We will demonstrate our
extensive knowledge in clothing/jewelry color combinations and current
fashion design trends. We will offer advice on how to dress for specific
occasions and which jewelry goes best with which clothing. We will be
the one source people turn to when they need advice on how to dress and
how to accent with jewelry.

 SALES STRATEGY AND POSITIONING

The Jewelry Store will be centrally located in the Malls and easily
accessible for customers. Our stores will reside in the middle of one of the
corridors thereby, having high visibility.

Based on our knowledge and experience with fashion design combined

with our skills at designing and making jewelry products we are a full
service jewelry store which sells jewelry tailored and customized to each
customer.

Because The Jewelry Store AJ is a new business, we understand that we

will have to prove our Company's worth to customers to earn their
business. As equally important, we need to sell both the Company and
products.

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We will approach sales from a salesperson-customer relationship basis. All

sales representatives will be trained and encouraged to assist customers in a
personal and engaging manner. By gathering key customer information 1
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and seeking design feedback on our products.
 With regard to all products, we will continue to stay abreast with the latest
fashion trends in order to offer our customers new, trendy jewelry.

 SWOT ANALYSIS

 Strengths

- Strong relationships with suppliers that offer credit arrangements, flexibility

and response to special requirements.

- Excellent and knowledgeable staff, offering personalized customer service.

The jewelry stores set itself apart from the competition by providing
customized jewelry designs.

- Great retail space with an attractive, inviting atmosphere.

- The owner keeps overheads low by purchasing directly from India, Brazil,
and China.

 Weaknesses

- Access to additional operating capital.

- Owners are climbing the retail experience curve.

 Opportunities

- Increase in higher income of target market.

- Addition of other jewelry related products and services.

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  Threats

- Local and emerging competitors.

- Shoplifting.

- Sales tied to economic growth.

3.7) OPERATIONAL PLAN

 PLANT LOCATION

‘SLENDOR JEWELS’ STORES will be located in the upscale

neighborhoods of New Delhi, Mumbai, Kolkata, Chennai and Bengaluru.
A significant proportion of the target market lives in these areas. We will
work with big publications, fashion as well as jewelry magazines to
generate PR and shopping in the neighborhood. We will also attract
women from other neighborhoods as well as the few women who come to
these places from out of town to shop.

 PLANT LAYOUT

The basic maintained theme of our outlets will be personified with the
color brown. The decor shall be of light colored walls supported with
diamond-like stones and curtains. Soft soothing music will accompany the
ambience of the store.

AJ stores will launch in July 2012 and have a website presence where
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customers throughout the country can go to learn more about our locations,
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 fashion related articles and announcements of new products. The website
for the first six to twelve months will be an informational site and will not
list our products.

 MARKET REQUIREMENT

The jewelry we will market will meet the needs of woman who are looking
to dress up their outfit with quality jewelry. The jewelry will be suitable for
both formal and informal events.

3.8) ORGANIZATIONAL PLAN

 ORGANIZATIONAL CHART

CEO

CHAIRMA
DIRECTO
N OF THE
R
BOARD

DIRECTO DIRECTO
R R

SALES
BUSINESS HUMAN
AND INVESTM
DEVELOP LEGAL RESOURC 1
MARKETI ENT
MENT E
NG 5
 JOB PROFILE

 TITLE : Chief Executive Officer ( CEO )

POSITION SUMMARY :

Develops and monitors strategies for ensuring the long-term

financial viability of the organization ;

Develops future leadership within the organization ;

Promotes a culture that reflects the organization’s values,

encourages good performance, and rewards productivity ;

Oversees the operations of organization and manages its

compliance with legal and regulatory requirements ;

Ensures that staff and board have sufficient and up-to-date

information ;

Evaluates the organization’s and the staff’s performance on a

regular basis ;

Oversees staff in developing annual budgets that support

operating plans and submits budgets for board approval ;

Serves as the primary spokesperson and representative for the

organization ;

Oversees design, delivery, and quality of programs and services.

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 TITLE : Chairman Of The Board

DEPARTMENT : Board Of Directors

REPORTS TO : CEO

SUPERVISES :Members of the Board Of Directors

SALARY GRADE : union

POSITION SUMMARY :

The President presides over meetings, proposes policies and

practices, sits on various committees, monitors the performance
of Directors and Officers, submits various reports to the board, to
funders, and to other "stakeholders";

Proposes the creation of committees;

Appoints members to such committees and performs other duties

as the need arises and/or as defined in the bylaws. 

- 17 –

 TITLE : Director

DEPARTMENT : Board Of Directors

REPORTS TO : Chairman Of The Board

SUPERVISES : Policy and Promotion of the

Organization
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SALARY GRADE : Union 7
 POSITION SUMMARY :

Organizational leadership and advisement;

Formulation and oversight of policies and procedures;

Oversight of program planning and evaluation;

Personnel evaluation and staff development;

Review of organizational and programmatic reports;

Promotion of the organization;

Fundraising and outreach.

 TITLE : Business Development Manager

DEPARTMENT : Business Development

REPORTS TO : CEO

SUPERVISES : Develop and maintain business

SALARY GRADE : Union

POSITION SUMMARY :

Manage, support, and supervise the business development

department.

He is responsible for the acquisition of new projects and project

bids and supports management by providing analysis for
evaluating new business opportunities such as in/out licensing,
collaborative research and development agreements, joint
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ventures, mergers and acquisitions. 8
 Set sales targets and define strategy to achieve these targets and
to follow the set strategy punctually.

Manage the proposal development process and maintain the time-

lines for the proposal teams.

Coordinate with sponsors concerning size, standards, conditions

and timing of research.

Develop draft proposals based on team meetings and discussions.

Maintain the Business Development databases and support

marketing activities.

- 19 -

 TITLE : Legal Secretary

DEPARTMENT : Legal

REPORTS TO : CEO

SUPERVISES : Clerical tasks

SALARY GRADE : Union

POSITION SUMMARY :

Legal secretaries perform clerical duties like legal

documentation that are necessary for keeping a firm running
efficiently. Prepare documents, including legal briefs,
spreadsheets and other office-related letters.

 TITLE : President of Sales and Marketing

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DEPARTMENT : Sales and Marketing
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 REPORTS TO : CEO

SUPERVISES : Management of company’s Sales and

Marketing

SALARY GRADE : Union

POSITION SUMMARY :

Strategic planning including corporate positioning market and

competitive analysis, customer segment selection and penetration
plans, and related product positioning.

Oversee marketing communications including branding, public

relations, advertising, seminars and events, analyst and market
research management, and website design and content either
directly or on an outsourced basis.

Work closely with Sales manager to develop and manage channel

and partner strategies and programs.

Oversee product management including market and customer

research for market and product requirements, interface with
engineering for product development, product pricing and
product lifecycle management.

Oversee product marketing including product launch

management, sales training, presentations, sales tools,
competitive analysis and general sales support.

Work with the CEO and the other executive team members to
identify and develop strategic alliances, raise venture/public
financing, communicate with BOD members, and close/grow
major customer accounts.
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 Develop and manage the Company’s entire marketing budget.

Develop and track metrics and success criteria for all marketing
programs and activities.

 TITLE : Investment Analyst

DEPARTMENT : Investment

REPORTS TO : President of Sales and Marketing

SUPERVISES : Monitor Financial News

SALARY GRADE : Union

POSITION SUMMARY :

Build and maintain financial models for group use (asset-liability

models, asset return simulation models, optimization models,
risk management, and risk budgeting).

Evaluate asset class, interest rate, and economic variables'

relationships and trends and implications for asset allocation
strategies; research and maintain databases of economic and
market index data, correlations volatilities and returns.

Analyzing financial information relating to company e.g.

company results, profit and loss and cash flow statements.

 TITLE : Human Resource Manager

DEPARTMENT : Administrative
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 REPORTS TO : CEO

SUPERVISES : Department of Labor

SALARY GRADE : Union

POSITION SUMMARY :

Maintain company employee manual ;

Prepare bi-weekly payroll for all facilities ;

Maintain and oversee employee evaluations ;

Prepare and publish monthly production shift schedule ;

Maintain and promote a team environment ;

Address labor issues and concerns;

Maintain employees vacations and PTO time.

- 22 -

3.9) FINANCIAL PLAN

Profit and Loss shows the profitability of the business, whereas, the Balance
Sheet shows the financial position of the Jewelry Store AJ. The Cash Flow
shows the status of cash received and cash paid over a specified period of
time. These documents are required to get financing for your venture.

Since we are entering a retail environment we will accept cash, checks, and all
major credit cards. We will select a check guarantee system to help reduce the
percentage of loss on bad checks. 2
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The following sections outline our financial plan:

 PROFIT AND LOSS ASSUMPTIONS

 Estimated Average Sales Price per unit is $ 4000

 Average daily sale: 2.67 units in year 1
 Revenue increase in Year 2 assumes average daily sales of 3.5
units or 27.78% annual increase.
 Revenue increase in Year 3 assumes average daily sales of 5
units or 42.86% annual increase (Revenues will level off near
year 3 and total assets will remain static)
 Service and Repair estimated Revenue: 10% gross sales
(industry average)
 Cost of Good Sold: 20% of gross revenues (compares higher
than industry peers @ 49.10%; mainly this is attributed to two
factors: 1) low cost associated with obtaining raw materials and
finding from China + 2) owner also constructs the final product,
further reducing overhead expenses.
 Advertising Expense: N/A; kiosk will be visible in the mall +
word of mouth
 Accounting: $400 monthly book keeping + $600 for income tax
preparations
 Bad Debts: Estimate 5%
 Shrinkage: Estimate 3%
 Credit Card Fees: $0.25 per transaction plus 1.5%
 Insurance: Estimate $400 annually
 Miscellaneous: Estimate: $250 annually
 Payroll Tax Assumptions: based on State of Maryland Income
Tax Rates
 Permits and License: Estimate $120 annually
 Rent: $2,700 monthly January – October then $9,100 for
November and December (Analysis assumes three (3) one year 2
3
 leases renewing annually with 3% escalations for inflation
rounded to the nearest $100)
 Salaries: Owner will not take salary for initial Year 1 and Year
2. At Year 3, owner will take salary of $10,000 and increasing
over time to $60,000.
 Annual increases allow for a 3% increase for inflation

 BALANCE SHEET ASSUMPTIONS

Start-Up Capital Items:

 AURUM JEWELS + Display:$2,500
 Beginning Inventory:$49,800 (which reflects industry averages
and compares in line with industry peers)
 PC Based cash register $4,000 (no annual maintenance fees)
 Assumes annual growth rate for total equity: 5% Year 2, and
7.5% Y3

 SOURCE AND USE OF FUNDS

This startup will be completely financed by the owner of the business.

The startup funds will be used to purchase initial inventory, purchase
the kiosk and display case, and a PC based cash register. Additionally
the owner will provide the necessary working capital requirements to
fund day to day operations for the initial year of operations. The
owner has enough funding to completely fund the business for the first
24 months without relying on sales or other sources of funds. The 2
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funds are liquid and primarily in the form of marketable securities.
  BREAK EVEN ANALYSIS

Total fixed costs associated with the jewelry kiosk are $70,624 and
represent the annual expenses associated with salary, credit card fees,
accounting and legal expenses, rent, insurance, permits and licenses,
bad debt and shrinkage, and miscellaneous expenses. The variable cost
(overhead) is estimated to be $20 per unit. Based on the assumption of
$100 as the average sales price per unit, the breakeven revenue then is
$88,281 or 147.14 units.

4. CRITICAL RISKS

4.1) No Clients
4.2) Copy of designs
4.3) Rental insecurities
4.4) Political situation (Strikes)
4.5) Power Breakdown
4.6) Shop Lifting

5. EXIT STRATEGY

Business will grow as we further develop a loyal customer base, as such we can expect
improvements in sales quarter over quarter. We have the financial resources to self fund
the business up to one year, which is the amount of time we give it to be profitable and
self sustaining. If after the first holiday season the business is not profitable we will not
renew our lease with the malls and will liquidate as many products as we can. Any
products remaining after liquidation will be sold over time through various exhibitions
and e-commerce website.
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6. APPENDIX

6.1) CV OF THE OWNER.

6.2) OWNERSHIP AGREEMENT.

6.3) MEMORANDUM OF UNDERSTANDING.

6.4) RESULTS OF MARKETING STUDIES CONDUCTED.

6.5) COPIES OF LEASES OR RENTAL AGREEMENTS.

6.6) LIST OF ALL BUSINESS CONSULTANTS, INCLUDING OUR ATTORNEY

& ACCOUNTANT.

6.7) RESUMES.

6.8) COPIES OF ALL LICENSES, PERMITS AND PATENTS FOR OUR

PRODUCT, SERVICE &/OR BUILDING.

6.9) COPIES OF ANY LEGAL DOCUMENTS ASSOCIATED WITH OUR

BUSINESS (CONTRACTS, ETC.)

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BIBLIOGRAPHY

 EHOW

 HOWCAST

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