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A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
A BUSINESS PLAN FOR A MOUSE
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A BUSINESS PLAN FOR A MOUSE

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A TECHNOLOGICAL BREAKTHROUGH WITH 3 LATEST ASSERTIVE TECHNOLOGIES PUT TOGETHER TO CREATE AN UNIQUE MOUSE TO HELP THE IT INDUSTRY.
PROPRIETOR MR. LALINDRA DE SILVA
ALL RIGHTS RESERVED.

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  • 1. Q,Lalindra@yahoo.comfdfffyuyy uuuyuyuyutyyuyuyuyuyuyuydsa uyuyuyuyuyuyuyuyuyuyuyjkhg hfhgfdQwertyuiopasdfghjklzxcv bnmqwertyuiopasdfghjklzxcvbn mqwertyuiopasdfghjklzxcvbnm qwertyuiopasdfghjklzxcvbnmq wertyuiopasdfghjklzxcvbnmqw ertyuiopasdfghjklzxcvbnmqwer tyuiopasdfghjklzxcvbnmqwerty uiopasdfghjklzxcvbnmqwertyui opasdfghjklzxcvbnmqwertyuiop asdfghjklzxcvbnmqwertyuiopas dfghjklzxcvbnmqQwertyuiopas dfghjklzxcvbnmqwertyuiopasdf ghjklzxcvbnmqwertyuiopasdfgh jklzxcvbnmqwertyuiopasdfghjkl BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE GROUP NO 14 N.I.B.M BSc BUSINESS MANAGEMENT (Sp)-UGC
  • 2. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 1 COMPANY PROFILE MC SOFT Company was formed in the year 2011 to cater to the Computer and IT industry. The company's main focus is to strive towards providing enhanced superior quality computer appliances at an affordable price. The top management consists of seven members who have a vast knowledge& experience in the Computer and IT industry. The Board of Directors is as follows. The Chairman- Mr Lalindra De Silva BSc BusinessManagement (Harvard), MSc Marketing Management (Cambridge) PHD Computer Science (Oxford) Deputy Chairperson - Ms. Thilini Bhagya BSc Business Management (NIBM), MBA HRM (Colombo) MSc Computer Science (oxford) Managing Director- Mr DimuthHeshan BSc Business Management (NIBM), MBA Industrial Management (Colombo) Finance Director - Mr Imran Imthiaz BSc Accounting (Sp) (First Class Honors) (Colombo), MSc Business Finance (Harvard) CIMA, AAT, Executive Director- Ms. Awanthi BSc in business management (Special) Kelaniya, CIMA, CIM Executive Director- Mr Gayan Sandaruwan BSc Management (Hon)(Sp)(SRI J'PURA),CMA
  • 3. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 2 EXECUTIVE SUMMARY MCSoft is a company based in the city of Colombo with a growing reputation in the computer industry. The company strives to provide enhanced, superior quality computer appliances at an affordable price. Since beginning in 2011, the company has successfully established itself in the computer industry and is known to provide products with excellent quality. Our main objective is to provide innovative products which benefit all computer users. This time we have developed a revolutionary product which will benefit gamers, graphic designers and all computer users alike. Fly Mouse is a unique, one of a kind revolutionary product which can change the whole concept of using computer mouse‟s. The constant technology advancement in the world has ensured that things which were thought to be “basic” such as computer mouse‟s, keyboards, earphones and other items etc..have all been “upgraded” to a totally new level. This product will be like a precious jewel to hardcore gamers, graphic designers and also to anyone who enjoys using computers. We at MCSOFT believe this product will be a huge success because we know everyone who uses a computer should be using a mouse and also that this type of mouse has never been sold previously. Fly Mouse is the first mouse which is capable of operating in 3-D and operates by levitating in air. It is the latest invention of MCSOFT. and also provides an excellent opportunity for investors to invest in. Fly Mouse is the first of its kind in the whole world and will thus allow MCSOFT. to be the only supplier in the market. This will allow us a strong position in the market and thus make us a monopoly. High profits and high return on investment can be expected once the product is fully launched.
  • 4. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 3 MARKET OPPORTUNITY Generally computer mousers have been categorized as pointing devices. It can be moved wherever you take it across a computer screen and when you click it various tasks can be performed. Slowly and surely as technology advanced, mousses were used to do more advanced things like drawings and graphic designing etc….Also people like to use it when playing games. The above mentioned things all do occur up to now but there is no major advancement in any particular category that offers ease of access to any specific user. We will be mainly targeting computer users who would like to do drawings and paintings on the computer, graphic designers, hardcore gamers and other specialist field designers etc. We will also be targeting the entire segment of general computer users. The main target market is a constantly evolving one since more and more people are now constantly seeking job opportunities in the IT sector. The decision to invest in this particular product now is because we feel the available market has grown to a significant proportion as such that we need not worry about having to think twice about launching the product.
  • 5. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 4 BUSINESS CONCEPT MCSOFTis a new company entering the computer & IT industry. We at MCSOFT believe in providing customers with innovative products so that they can do things easier. We mainly sell hardware products such as keyboards, mouses, headsets and hard drives etc. We believe that we have the capacity to provide an innovative solution to all hardware products that currently exist. We know it is an extremely challenging task but we are up to it always. We will mainly be focusing to sell our product to the following categories of people. 1. People who do drawings and paintings on a computer 2. Graphic designers 3. Gamers 4. Other industry designers 5. People who use ECAD software Initially we will be distributing the product across various parts of Asia and Europe. Thereafter based on the response and feedback we will be hoping to go worldwide. The above mentioned categories of people would all prefer to have more degree of freedom with regard to the specific applications each of them use. Designers, people who do drawings and people using ECAD software would really like this product since it operates in 3-D. This will enable them to create an exact replica of whatever image they were attempting to recreate. The users do not have to purchase light pens or any other equipment to produce the relevant image on to the screen. For gamers, we have a whole new level in store for them. Fly Mouse can be used as a gaming console since it operates in 3-D and there will also be forced-feedback and multiple buttons just like as in a gaming console. This will eliminate the need of the user purchasing a separate mouse and gaming console and will thus be a cost saving for the user.
  • 6. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 5 BUSINESS MODEL In business strategy, a business model should be planned and developed since this helps in figuring out the probability of profitability of a new product such as Fly Mouse. It will provide a means of identifying different paths of revenue generation and profit maximization that Megabyte can pursue with regard to the product Fly Mouse. It also provides an insight into the current market situation, competitor profiles and existing market competition. CUSTOMER VALUE PROPOSITION A value proposition is carried out to depict all the potential benefits that will be enjoyed by the users of Fly Mouse. One of the most important beliefs of MCSOFT is to build a strong, trustworthy, everlasting relationship with each and every one of its customers. This is achieved by providing our customers with excellent, innovative, quality products that are unique and durable. In our perspective to provide efficient, innovative and reliable products to our customers, we have constantly carried out market research to identify specific needs of each user category. We at MCSOFT have realized the fact that technology can enhance the day-to-day lives of all computer users. With the invention of Fly Mouse, all of our target customers would benefit greatly. Through the distinct advantages that lay around Fly Mouse, we believe that this product will bring along huge customer satisfaction.
  • 7. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 6 COMPETITION When launching a new product it is extremely important to consider the competition that exists within an industry so as to determine the amount of profits we can reap from that particular industry. Competition influences the marketing strategies a company will take in order to maximize revenue and thus profit. SWOT ANALYSIS The SWOT analysis is a tool which can be used to highlight the strengths and weaknesses of our particular product. Analysing the strengths of our product will help us to find out any business opportunities that will enable our company to have a stronger market position. Also being aware of any weaknesses that exist in our product will help us to minimize any threats that may reduce the demand for the product. Therefore SWOT analysis proves to be a useful tool that helps to carve business strategies in order to keep a sustainable share in the market. While the strengths and weaknesses are affected by factors internal to the company, the opportunities and threats are related to the external environment which can be defined by the PEST (Political, Economic, Socio-cultural and Technological) factors.
  • 8. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 7 The above diagram shows the SWOT analysis of Fly Mouse. It shows the strengths, weaknesses, opportunities and threats that will be faced by Fly Mouse once launched fully in to the market. POSITIVE NEGATITIVE INTERNAL EXTERNAL STRENGTHS - Once launched will be a monopoly in the market - Design product according to users’ needs, innovation technology - High quality standards, global workforce & customer service WEAKNESSES - Low economic activities due to global economic situation - Restricted market - Need to improve sales and marketing expertise OPPORTUNITIES - Few or no economies of scale - Technological innovation THREATS - Global economic crisis, difficulty to obtain investment - MCSOFT
  • 9. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 8 Marketing and Alliances Marketing Objectives Ever since the establishment of the company, MCSOFT.has launched a great variety of successful products that are used and trusted by its customers. The first and foremost marketing objective of our company is to gain the trust of customers and end users within a short period of time. With over 5 years of experience in the research and development of products for the hardcore gamers and high end graphic designers, the company is confident that its latest invention will be readily accepted by its customers and would greatly aid to their convenience. The company intends to launch the ultimate product, TheFly Mouse, in the European as well as the Asian market simultaneously in an attempt to earn quite a noteworthy reputation and increase brand equity from every possible perspective of customers. This is because the product would face greater competition in the Europe, while Asia is still quite a fresh market for such products. However, due to relatively high price of the product, the scope of sales in Europe might be better. Another potential market could be The United States. However, due to the economic slowdown, the demand of the product might be affected. Target customer segment The main target market segment would be hardcore gamers and professional high end graphic designers. Another minority target user would be those wanting to learn or experience newer technologies. The product could be sold to general public as well as CAD software companies, gamers and 3-D designers.
  • 10. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 9 Chart 1 Target Market Unfair Advantages It is quite obvious that humans always look forward to own any product which houses the latest technology and which has the capability to make their lives simpler. The following are the aspects which boosts our confidence on selling this product in the current market. The first and foremost benefit for the Fly Mouse is that, it is the first of its kind, to be released into the market. The Fly Mouse can be used in 3-D graphic designing which was a tough job till now. Due to the added accelerometer, it provides the motion along the missing z-axis. Also whenever necessary, it can be used as a normal mouse. Due to the added features and the extra option buttons, the necessity of a joystick is omitted for the hardcore gamers. Provides almost everything a multimedia user needs. Especially DJs will definitely find it impossible to be successful without this Fly mouse. Gamers 40% CAD Users 40% Multimedia Users 15% General purpose users 5% Target Market
  • 11. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 10 Market Research Strategy Market Research is a key aspect in the development of any new product. It helps us to get a much clearer picture of the wants and needs of the customers and hence provide them with better solutions; thus reducing the risk of product failure. Considering this fact, it was intended to carry out both primary and secondary market research that would provide the company, with business intelligence to make informed decisions. Secondary research would enable, to gather information gleaned from studies previously performed by government agencies, game manufacturers and graphic designing software manufacturers. This in turn would provide statistics about the population of potential Fly Mouse users. Secondary research would also include study of existing products and their limitations. Primary research would be carried out through questionnaires and personal interviews with potential customers. This would enable the company to identify the difficulties which the customers face with the existing products and how they can be resolved. This would also help to get a good idea about which pricing strategies to be used and how much the customers will be willing to pay for the product.
  • 12. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 11 Marketing Mix The marketing mix for Fly Mouse is intended to generate a positive response in the target market by blending the four P‟s in an optimal manner. The marketing management plan would be strategized in following manner. Product The Fly Mouse is the latest innovation of MCSOFT, incorporating the newest assistive technology. It can be categorised under speciality goods that are of interest to a niche market of specialized PC users like CAD designers and gamers but also to the general computer users. MCSOFT has successfully provided PC related solutions and has been able to build a fairly good reputation amongst its customers in the past 5 years. This is mainly due to company‟s main focus on excellent quality and reliability of its products. With its latest invention The Fly Mouse, MCSOFT has once again taken one step further in bringing the employment sector closer to the dominating, PC based world. This is the first ever floating mouse which is built, incorporating four types of leading technologies integrated onto a single device (optical, wireless, accelerometer and electro-magnetism). And this would be a unique selling point of the product.
  • 13. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 12 Price Due to four main latest technologies being used, assuring quality and reliability, the cost of the Fly Mouse is expected to be relatively high. But it is still cost-effective, considering the benefits that it offers. This would be reflected in the price. The pricing objectives to be considered when setting the price of the Fly Mouse can be prioritised in the following manner. Survival of the product Quality leadership Maximise profit margin The demand for the Fly Mouse is expected to be elastic, due to the current unstable economic situation. Therefore a lot of strategic planning and analysis was needed to be carried out before setting the price of the Fly Mouse. In addition, due to rapid technological advancement, high competency and short life-cycle of electronic products, its value is expected to depreciate over time. In order to overcome this, the company intends to improvise the product at a later stage to overcome the limitations and hence stay competent in the market for a longer time. The price would be set, based on a combination of cost-plus and value-based pricing method. Cost-plus pricing would ensure that the costs are covered up, plus a certain percentage of profit is earned on each unit sold. Value-based pricing on the other hand, will pass on the effective value relative to alternative products; thus ensuring that the product is not under- valued. Placement The product is targeted mainly at a niche market though it is open to the general market as well. Therefore, the volume of sales is expected to be low. The most appropriate distribution channel that could be used is manufacturer-retailer-customer. In addition, to save development costs, it was intended to make use of assembly factories whereby, ready-made spare parts are bought and the product can be assembled. Due to low volume of sales, there is no necessity for wholesalers. This would save cost because the shorter the distribution channel, lower the cost. The Fly Mouse would be placed in leading electronic outlets and PC fairs in the international market.
  • 14. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 13 Customer Relationship Management Customer relationship management (CRM) consists of the processes a company uses to track and organize its contacts with its current and prospective customers. CRM software is used to support these processes. Information about customers and customer interactions can be entered, stored and accessed by employees in different company departments. The main goals of CRM include improvement of services provided to customers and to use customer contact information for targeted marketing. The company is currently using Relational Database Management System (RDBMS) in all its departments for storing information related to customers and orders. RDBMS stores data in the form of related tables. It is a powerful tool because it allows various departments to share and relate information; thus ensuring good connectivity among departments. MCSOFT values all its customers‟ suggestions and comments. Therefore the customer feedback is constantly monitored. This is to ensure that customer requirements are catered by identifying any design faults, increasing durability of the product, reducing prices, enhancing features presently available on the Fly Mouse and any other modification the customer requires from the company.
  • 15. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 14 Technical Description Floating mouse working under the concept of magnetic induction. Basic Concept Inspiration – since the evolution of mouse design which evolved from it‟s basic design of the track ball to the current optical technology, all has a certain degree of friction which mainly depends on what kind of surface you use on. This can be a bit of a hassle in certain instance such as gaming or sensitive drawings which need precision. So to avoid this & for comfort we came up with this idea, which we think would revolutionize the idea of the mouse. What we have created is an ingenious way to make the mouse which levitates in air defying gravity eliminating friction. The technology behind this comes from magnets. Since like poles of a magnet repel each other, this enables us to provide lift to the mouse & maintain levitation. Instead of using permanent magnets which are uncontrollable & provides a constant lift for a certain weight, we use electromagnets which are fully controllable & it provides a variable lift for any weights. Exploiting this we are able to create the ultimate mouse. Magnetic induction isn‟t a new technology, it has been around for nearly a century & totally reliable. Products based on this technology such as floating globe, maglev train & many other products are currently available. Products based on magnetic induction
  • 16. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 15 The induction pad(float pad) contains two different coils with two different purpose. while coil 1 produces a magnetic field of a fixed polarity, coil 2 produces a varying magnetic field to power the mouse & to charge it‟s battery Strong permanent magnet of fixed pole can also be used to provide additional lift. As you can see in the above diagram, the basic product includes two components, the mouse & the float pad. The float pad appears to be like a normal mouse pad. The bottom of the
  • 17. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 16 mouse also contains conduction coils to provide an opposing magnetic field & to obtain power for its operation. Illustration of the concept on how it works If the power output of the USB port is not sufficient, additional adaptors can be used to attach it to the mains. Comfort Due to long term usage of a normal PC mouse your hands are exposed to stress & fatigue. Therefore our products‟ design tends to provide maximum comfort. The best part of it is that our customers would feel the floating sensation. This picture shows how your hand would be positioned to provide extra comfort & precision eliminating stress. The bottom part of the mouse is equipped with a cushion to make handling more easier.
  • 18. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 17 we could produce float mouse of different sizes to suite different hand sizes so that two maximize comfort. Extra features Additionally we provide extra buttons depending on the customer‟s needs or purpose. For example a graphic designer would need a different set of buttons aligned at different position varying from a gamers needs. And all of these buttons would be customizable by the software we provide. Due to the floatation of the mouse the bottom part of it would be decorated with small LED‟s to give the float pad a neon effect, or the float pad can be decorated by the customer‟s request to provide mood lighting. All our products are fully customizable at the request of the customer. buttons which can be Customized by the software provide to satisfy the customers needs.
  • 19. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 18 All mouses we produce are equipped with an optical sensor, a digital compass &a accelerometer. This enhances the mouse capability to get rid of the current concept of 2D motion & transforms it into a exciting new 3D space maneuverable mouse. This works similar to the Nintendo Wii gaming system by it use‟s the current mobile phone technology for GPS & motion detection. This enables you to take the mouse away from the floatpad& use it in space in any direction for the cursor movement. Exploit this capability to increase productivity in CAD systems, maximize gaming performance. Extended wireless connectivity Instead of using Bluetooth technology we are integrating Wi-Fi into float mouse so that it would have an extended rage & minimum interference. Force feedback For gaming enthusiast we could provide force feedback capabilities to the mouse so that it would improve gaming experience Variable size floatpad Depending on the customer‟s needs they could choose the floatpad size so that the floating range of the mouse can be extended.
  • 20. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 19 Visual customization Custom made covers for the mouse on demand by the customers can be provided. Dual (Left, right) handed users No worries for left hander users since we provide float mouse for both users. Any surface usage Can be used on any surface when it‟s away from the float pad & serves as an ordinary mouse. Key benefits Greater comfort. No wire hassle. Friction free. Can be used anywhere & any surface (toggles between optical & gyroscopic sensors). No need to change batteries. Greater range. More precision
  • 21. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 20 Intellectual Property You need to consider the protection of your intellectual property early in the formation of the business. It is heartbreaking to find that the idea you‟ve worked so hard to conceptualize and develop is stolen by other people and companies. Float mouse is the first ever mouse with floating capability using viable current technologies into a single integrated device to provide an ultimate new experience in pointer technology. The design of the product is truly unique and hence the company plans to patent the design under the World Intellectual Property Organization (WIPO). This would be achieved using the industrial design rights, which provides protection against replicating the design of Float mouse. The industrial design of Float mouse consists of implementation of current existing technologies & integrating them into a new product. Float mouse is not just an ordinary mouse, but it can also be used for various purposes as an interactive & entertaining device incorporating the latest smart technologies. It can be used as a DJ equipment. Total control of PC gaming getting rid of the keyboard (ex:- by tilting the mouse it can be used to move forward & backward) No more surface needed for operation except when it‟s on float mode. Extended wireless freedom (greater range). Maximum comfort.
  • 22. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 21 Future Initiatives Greater force feedback. Improve pointing precision. More software to take advantage of the mouse capabilities. Replace buttons with touch sensitive surface. Small LCD on mouse to indicate battery level & connectivity strength. Price Range The products‟ price depend on the additional features & customization on the product. But all float mouse has the basic feature of floating & is Rs 1990 onwards. Functions (all are included 21x18 cm floatpad) Price (Rs) 2button float mouse Basic) 500 3 button, scroll (normal) 1000 4 button, scroll wheel with digital compass & accelerometer (premium) 1500 6button scroll wheel with digital compass & accelerometer + button customizable software (ultra) 2000 6button scroll wheel with digital compass & accelerometer + button customizable software + force feedback (ultimate) 2500
  • 23. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 22 All mouse are customizable with LED‟s, comfort cushion, & top covers. Also the area of the float pad can be extended for an extra sum. Additional features Extra fee (Rs) For every additional 10 square cm of floatpad 50 LED around bottom of the mouse 200 LED around floatpad 200 Financials The financials for this company will be done quarterly for 2 years, 5 years in total. In order to prepare a financials table the incomes and expenses of the company have to be known so that the margins may be then calculated. The following are all the incomes which the company may obtain during the period of 5 years. Certainly, not all incomes would be incurred during the beginning years but as time passes incomes would continue building up. Product Sales Advertisements – These advertisements are when the product is remarkable to the majority and hence other companies would like to use this product to advertise theirs and hence they will have to pay for that. Promotional Offer – These offers will make more consumers to go for the product hence greatly raising the Turn over though there would be fewer profits. Royalties – This income might also come in after some time. After observing the Mcsoft product reviews, other companies may like to purchase the new innovated copyright technology hence giving an income to the company. Contracts – There would be some retail companies which might want to sign a contract for sales for some years hence paying in advance for this. For any company to go in a loss, the expenses continually are more than the income. Therefore in order for a company to become successful, it has to ensure it earns more then it spends. The following are the expenses which would be incurred by MCSOFT.
  • 24. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 23 Factory Rent Raw materials – This includes all necessary equipments to manufacture a complete product. License Research and development costs Salaries Transportation – This may include product transportation to the customers. During the first quarter of the first year, the expenses to income ratio would be quite high; this is because the product would not yet be known amongst the people and therefore not much sales. As time goes on, the product would be more advertised mainly using free publicity and known more amongst the people hence more sales. Utilizing all business tactics like promotional offers would as well enhance sales. The following are the financials tables for the five upcoming years. All values are in Sri Lankan Rupees (LKR). Balance Sheet Year 2011 Quarter1 Quarter2 Quarter3 Quarter4 Total Assets Cash 410616 226623 120729 127536 50000 Equity Capital 522613 267721 155877 105813 216520 Profit/loss -111927 -41098 -35148 21732 16652 Total 50000 Year 2012 Quarter1 Quarter2 Quarter3 Quarter4 Total Assets Cash 183498 192225 263898 289069 93500 Equity Capital 161844 203591 222276 297479 50000 Profit/loss 21654 -11366 41622 -8396 43500 Total 93500
  • 25. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 24 Year 2013 Quarter1 Quarter2 Quarter3 Quarter4 Total Assets Cash 310851 436095 561339 686591 240500 Equity Capital 289103 394347 859616 948960 93500 Profit/loss 24776 41748 41748 41748 147000 Total 240500 Year 2014 Quarter1 Quarter2 Quarter3 Quarter4 Total Assets Cash 712376 798720 890064 975616 333500 Equity Capital 706928 768272 859616 948960 240500 Profit/loss 25176 39448 30448 26448 93500 Total 333500 Year 2015 Quarter1 Quarter2 Quarter3 Quarter4 Total Assets Cash 993876 1073970 1154064 12478666 429500 Equity Capital 987178 1047272 11273666 121960 333500 Profit/loss 28926 26698 26698 356908 96000 Total 429500
  • 26. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 25 Income Statement YEAR 2011 Incomes Quarter 1 Quarter 2 Quarter 3 Quarter 4 Totals Sales 0 19900 29850 53730 103480 Contracts 0 0 0 50000 50000 Total 153480 Expenses - - - - Factory Rent 5000 5000 5000 5000 20000 Raw Materials 10000 10000 15000 27000 62000 License 10000 0 0 0 10000 Research and Development costs 50000 5000 0 0 55000 Salaries 36000 38000 40000 44000 158000 Transportation 1000 3000 5000 6000 15000 Total 320000 Margin -166520 Year 2012 BalB/f -166520 Incomes Quarter 1 Quarter 2 Quarter 3 Quarter 4 Sales 69650 73630 75620 79600 298500 Contracts 60000 20000 70000 20000 170000 Total 468500 Expenses - - - - Factory Rent 5000 5000 8000 8000 26000 Raw Materials 35000 37000 38000 40000 150000 License 10000 0 0 0 10000 Research and Development costs 5000 8000 0 2000 15000 Salaries 46000 48000 50000 50000 194000 Transportation 7000 7000 8000 8000 30000 Total 425000 Margin -123020
  • 27. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 26 Year 2013 Bal B/f -123020 Incomes Quarter1 Quarter2 Quarter3 Quarter4 Sales 112500 112500 112500 112500 450000 Contracts 42500 42500 42500 42500 170000 Royalties 4998 4998 4998 4998 20000 Advertisement 1250 1250 1250 1250 5000 Total 645000 Expenses Factory Rent 7500 7500 7500 7500 30000 Raw Materials 51625 51625 51625 51625 220000 License 10000 10000 Research and Development costs 10000 10000 Salaries 51625 51625 51625 51625 220000 Transportation 8750 8750 8750 8750 35000 Total 498000 Margin 21748 41748 41748 41748 23980 Year 2014 Bal B/f 23980 Incomes Quarter1 Quarter2 Quarter3 Quarter4 Sales 110000 120000 120000 120000 470000 Contracts 42500 42500 42500 42500 170000 Royalties 4998 4998 4998 4998 20000 Advertisement 2450 2450 2450 2450 10000 Total Expenses Factory Rent 7500 7500 7500 7500 30000 Raw Materials 57000 57000 57000 59000 230000 License 10000 10000 Research and Development costs 5000 5000 Salaries 66000 66000 66000 67000 265000 Transportation 9000 9000 9000 10000 37000 Total 577000 Margin 5448 30448 30448 26448 116980
  • 28. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 27 Year 2015 Bal B/f 116980 Incomes Quarter1 Quarter2 Quarter3 Quarter4 Sales 120000 120000 120000 130000 490000 Contracts 42500 42500 42500 42500 170000 Royalties 4998 4998 4998 4998 19992 Advertisement 2450 2450 2450 2450 9800 Total Expenses Factory Rent 7500 7500 7500 7500 30000 Raw Materials 60000 60000 60000 60000 240000 License 10000 10000 Research and Development costs 10000 10000 Salaries 66000 66000 66000 66000 264000 Transportation 9750 9750 9750 9750 39000 Total 594000 Margin -6698 26698 26698 35698 212980
  • 29. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 28 Cash flow statements Year1 Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 B/F 169221 136872 104523 87657 75541 63425 52209 40 Cash Receipts Capital 216520 Sales 0 0 0 6633 6633 6633 9950 9950 9 Contracts 0 0 0 0 0 0 0 0 Total Cash Payments Factory Rent 1666 1666 1666 1666 1666 1666 1666 1666 1 Raw Materials 3333 3333 3333 3333 3333 3333 5000 5000 5 License 10000 0 0 0 0 0 0 0 Research and Development costs 20000 15000 15000 5000 0 0 0 0 Salaries 12000 12000 12000 12500 12750 12750 13000 13500 13 Transportation 300 350 350 1000 1000 1000 1500 1750 1 Total C/F 169221 136872 104523 87657 75541 63425 52209 40243 28 Year2 Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 B/F 50000 50678 61166 71654 67862 64075 60288 74022 87 Cash Receipts Capital Sales 23210 23220 23220 24540 24545 24545 25200 25210 25 Contracts 20000 20000 20000 6600 6700 6700 23000 23500 23 Total Cash Payments Factory Rent 1666 1666 1666 1666 1666 1666 2666 2666 2 Raw Materials 11600 11700 11700 12300 12350 12350 12600 12700 12 License 10000 Research and Development costs 1666 1666 1666 2666 2666 2666 Salaries 15300 15350 15350 16000 16000 16000 16600 16700 16 Transportation 2300 2350 2350 2300 2350 2350 2600 2700 2 Total C/F 50678 61166 71654 67862 64075 60288 74022 87966 101
  • 30. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 29 Year3 Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 B/F 93500 91986 103617 115248 133734 145365 156996 175482 187 Cash Receipts Capital Sales 37500 37500 37500 37500 37500 37500 37500 37500 37 Contracts 14160 14170 14170 14160 14170 14170 14160 14170 14 Royalties 1666 1666 1666 1666 1666 1666 1666 1666 1 Advertisement 410 420 420 410 420 420 410 420 Total Cash Payments Factory Rent 2500 2500 2500 2500 2500 2500 2500 2500 2 Raw Materials 14925 18350 18350 14925 18350 18350 14925 18350 18 License 10000 Research and Development costs 10000 Salaries 14925 18350 18350 14925 18350 18350 14925 18350 18 Transportation 2900 2925 2925 2900 2925 2925 2900 2925 2 Total C/F 91986 103617 115248 133734 145365 156996 175482 187113 198 Year4 Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 B/F 240500 230636 235792 245948 256084 266240 276396 286532 296 Cash Receipts Capital Sales 35000 35000 40000 40000 40000 40000 40000 40000 40 Contracts 14160 14170 14170 14160 14170 14170 14160 14170 14 Royalties 1666 1666 1666 1666 1666 1666 1666 1666 1 Advertisement 810 820 820 810 820 820 810 820 Total Cash Payments Factory Rent 2500 2500 2500 2500 2500 2500 2500 2500 2 Raw Materials 19000 19000 19000 19000 19000 19000 19000 19000 19 License 10000
  • 31. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 30 Research and Development costs 5000 Salaries 22000 22000 22000 22000 22000 22000 22000 22000 22 Transportation 3000 3000 3000 3000 3000 3000 3000 3000 3 Total C/F 230636 235792 245948 256084 266240 276396 286532 296688 306 Year5 Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 B/F 333500 322386 331292 340198 349084 357990 366896 375782 384 2 Capital Sales 40000 40000 40000 40000 40000 40000 40000 40000 40 Contracts 14160 14170 14170 14160 14170 14170 14160 14170 14 Royalties 1666 1666 1666 1666 1666 1666 1666 1666 1 Advertisement 810 820 820 810 820 820 810 820 Total Cash Payments Factory Rent 2500 2500 2500 2500 2500 2500 2500 2500 2 Raw Materials 20000 20000 20000 20000 20000 20000 20000 20000 20 License 10000 Research and Development costs 10000 Salaries 22000 22000 22000 22000 22000 22000 22000 22000 22 Transportation 3250 3250 3250 3250 3250 3250 3250 3250 3 Total C/F 322386 331292 340198 349084 357990 366896 375782 384688 393
  • 32. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 31 The financial tables above show whole of the expenses and incomes which may incur during the five upcoming years. These values are obtained logically by studying our business strategy of our product. It is seen that as years pass the expense to income ratio keeps on reducing and hence during the 3rd year there is a break point; a point where the business undergoes profits. During the first two years there are negative profits though there surely is some good improvement in the business. During the first quarter of the first year, products were just distributed for tasting purposes hence no sales made during that time, but from the second quarter that‟s the time when sales will begin. Monitoring the expenses deeply, it is observed that nearly all expenses increase during the years, but this increment is not as much as that of the income. The factory rent gradually increases due to expansion of floor area required to produce the product. All other expenses increase as well, each having a reason behind it except the license and research and development. The license certainly remains the same for all years since it is just a constant amount to be paid while for the research and development it depends on how the product is during that year; if the product works well with most then there is no point of making researches for improvement hence the expense for it reduces. The following diagram shows a plot of profits against year. From the above plot it can be said that the company may get back its costs after the 3rd year. There is a reason for this profit and it is that the megabyte fly mouse is the first ever fly mouse produced and hence many would surely love to experience this new technology. -200000 -150000 -100000 -50000 0 50000 100000 150000 200000 250000 2010 2011 2012 2013 2014 2015 2016 ProfitinMalaysianringitts Year Break even point plot
  • 33. GROUP 14- BUSINESS ENVIROMENT REPORT MCSOFT FLY MOUSE Page 32 Key Assumptions 1. The product would be greatly demanded in some years time due to the new innovated technology. 2. In some months, Megabyte Company would get contracts from other companies to ensure continuous sales to the company. 3. A few companies will purchase the right of using our technology for their products (Royalties). Financing/Uses of funds The starting capital is gotten from the board of directors who are as well the designers and planners of the product. These directors have experiences in other known companies and that is where they got these funds from to establish another company. As seen from the financial tables, the starting capital has to be at least LKR112000 (total expense during the first quarter of the first year) without which the business would not be able to proceed further. Any further funds required may as well be obtained from banks as loans. These loans have to go on till the business becomes stable and that according to the plot would be in the third year. It is elaborately explained in the financials section to what expenses there would be and thereby information on the usage of funds. The main starting expenses would be the salaries, factory rent, research and development, transportation, license and other miscellaneous expenses. These expenses are the most necessary ones in order to start operating this business. Especially the research and development would require approximately LKR 50000 at the starting since that is the time when all the research for the product is done. All the above shows that this would be a nice opportunity for anyone to invest his/her money to this business plan and therefore there were some previous investors who were really interested, but due to the recent financial crisis they had to back out. There also was another group of investors who were to invest in this but back then implementation of this technology was really expensive especially for the components required for this were rarely available and if available too expensive. Plans at times may not turn out as expected hence there are always some chances of plans to fail. Business planning may also result to a failure therefore this failure has to be taken into consideration and „planned‟ for as well. The MCSOFT team therefore will sign an agreement (when purchasing the license) with the government to pay off all the loans in case of our product failure hence protecting us from any difficulties.

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