Project Business plan project : Home Automation Technology

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BUSINESS PLAN
Executive Summary
Tag-line:
Automate-me to be smart.
Need:
Today we are living in 21st century where automation is playing important role in
human life. Home automation allows us to control household appliances like light, door, fan,
AC etc. It also provides home security and emergency system to be activated.
The need of home automation through internet which already exists in market with
bluetooth module to control the home appliances, security, locks and many more, is to make
life easier than before because if someone wants to access his home appliance out of the home
to control AC, lights or to have look on security cameras located in their home will access them
just by a single click of mobile application doesn’t matter wherever they are.
There is much need for home automation for the people of those cities where there is
no awareness of this and they want their cities to be advance just like popular cities.
Solution:
Applications to control the home appliances through bluetooth module are available in
market but there is no application to automate multi appliances, locks and others with some
new innovation in that to make life easier for people.
Our company is going to build a mobile based android application with modules for
internet access to control the home appliances from a home distance and will enable the user
to automate all in one just by a single click. This will include some sensors for the hardware
which will be used in this project or which is going to be automated.
Summary:
Auto Control company which is working on the project of home automation through
internet access and bluetooth, WI-FI sensors, is developing a mobile based application which
will be used to automate appliances and others just by a single click.

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In this plan marketing strategies, financial plan, porter’s model of five forces, SWOT analysis,
competitors’ analysis and related description according to the home automation project
requirements are mentioned.
Moreover, there is a description of product, market of the product, place where it is to
be launched and other marketing mix contents’ description is mentioned in a detail.
Business Description
Auto Control company is working on application development which will allow its users to
control their home appliances, locks, security system and others just by a single click through
the that application. Auto control company is based on that business form in which five team
members will work together to make this project successful for the easiness in the life of
people.
Team:
The team of five members will work together on this project of home automation. In team
there is manager, finance manager, developers and market analyzer.
Manager:
Manager/Team leader is the person on the top of management who will supervise all of the
team members according to their designations, whether the working of project is in process or
whatever the situation will be.
Finance Manager:
Finance manager will manage all the financial requirements for the business of Auto Control
Company. Startup finance, operating finance and all other expenses according to the
consumption of the home automation product will be managed by the financial manager.
Developers:
Developers will work on the development of the application for home automation. They will
develop the application user friendly, easy to control and many other effective modules in it.
Market Analyzer:
Market analyzer is one who will analyze the whole market in case of competitors, buyers and
product availability in the respective market in which our product is going to be launched.

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Organizational Structure:
Mission:
A mission statement defines the long-term goals of the business. The mission of the Auto
Control company is to facilitate the people in accessing there home appliances within the home
or out of the home. We are aiming to let the small cities out of the complexity in which they are
living. To aware them by the technology that they can also use to control their home structure
just through a single click.
Developer
Mr. Ahad
Manager
Team Leader
M. Adil Anwar
Co-Developer
M. Shoaib
Finance Manager
M. Mateen
Market Analyzer
Miss Rida

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Vision:
The vision statement is often confused with the mission statement. Actually, the vision
statement is about what the business's future will look like if the mission is achieved.
We have a vision of a smart home which will show the smartness in the technology for the
controlling of home appliances just by a single click on mobile application. This will make the
home smart where security issues of cameras will be accessed by the users through internet,
wherever they are located on that time. It will through a positive response by the cities which
are not much aware of technology and want to develop their cities as others are popular.
Goals:
Our goal is to target small cities to aware them for the technology and to let them out of
complexity.

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Industry Analysis
Auto Control Company in Lahore, Pakistan is first to implement the idea of automation for
home appliances through internet. Before this in Pakistan Haier is the only company which
introduced AC automation through mobile sim. This Five Forces analysis of Auto Control
Company (based on Porter’s Model) indicates that external factors in the industry environment
emphasize competition, customers, and substitution.
Porter’s Five Forces analysis model identifies the most relevant external factors that influence
business organizations. In Auto Control Company Five Forces analysis, the focus is on the
automation industry. The environment of this industry interacts with automation companies to
affect the Company’s potential and success.
Five Forces Analysis:
In this Five Forces analysis, Auto Control Company experiences the effects of external factors at
varying intensities. The company must implement strategies to meet these external factors and
minimize negative impact. In summary, Auto Control Company Five Forces analysis yields the
following intensities of the five forces:
1. Competitive rivalry or competition (strong force)
2. Bargaining power of buyers or customers (strong force)
3. Bargaining power of suppliers (weak force)
4. Threat of substitutes or substitution (strong force)
5. Threat of new entrants or new entry (moderate force)
The results of the Five Forces analysis shows that Auto Control Company needs to prioritize the
issues related to competition, consumers, and substitutes, all of which exert a strong force on
the company. A possible course of action for Auto Control Company to address these issues is
product innovation. Auto Control Company product can attract and keep more customers. Also,
this Five Forces analysis shows that Auto Control Company can implement higher quality
standard automation to address competition and substitution in this saturated market.
Competitive Rivalry:
Auto Control Company faces low competition because the automation market is
already saturated but not enhanced in providing automation through internet. This element of
the Five Forces analysis tackles the effect of competing firms in the industry environment. In

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Broadway’s case, the strong force of competitive rivalry is based on the following external
factors:
 High number of firms (strong force)
 High aggressiveness of firms (strong force)
 Low switching costs (strong force)
Bargaining Power of customers:
Auto Control Company must address the significant power of customers.
This element of the Five Forces analysis deals with the influence and demands of consumers. In
Auto Control case, the following are the external factors that contribute to the strong
bargaining power of buyers:
 Low switching costs (strong force)
 Large number of providers (strong force)
 High availability of substitutes (strong force)
Bargaining Power of suppliers:
Suppliers also influence Auto Control Co. This element of the Five Forces
analysis shows the impact of suppliers on firms. Auto Control Co. case, the weak bargaining
power of suppliers is based on the following external factors:
 Large number of suppliers (weak force)
 Low forward vertical integration (weak force)
 High overall supply (weak force)
Substitution:
Substitutes are a significant concern for Auto Control Co. This element of
the Five Forces analysis deals with the potential effects of substitutes on company’s growth. In
Auto Control Co. case, the following external factors make the threat of substitution a strong
force:
 High substitute availability (strong force)

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 Low switching costs (strong force)
 High performance-to-cost ratio (strong force)
Threat of new entrants:
New entrants can impact Auto Control Co. market share. This element of the
Five Forces analysis refers to the effects of new players on existing firms. In Auto Control Co.
case, the moderate threat of new entry is based on the following external factors:
 Low switching costs (strong force)
 Moderate capital cost (moderate force)
 High cost of brand development (weak force)
Competitors:
Competitors are available in market but they are internationally available and in Pakistan there
is only Haier is the only company which is introducing home automation through mobile sim
access just for the automation of AC. There are low number of competitors who are offering
these features but they are not reliable and compatible much.
SWOT Analysis:
SWOT Analysis is a useful technique for understanding your Strengths and Weaknesses, and for
identifying both the Opportunities open to you and the Threats you face.
Strengths:
The strength of our home automation product is that we are facilitating our users through
internet automation. They will enable security module in that so they can access their home
cameras though their mobile applications.
Weaknesses:
In term of weakness of our home automation project there is a little gap which will be of
accuracy of the sensors which will be overcome by us during the development of the
application through testing.

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Opportunities:
Technology is becoming vast now a days which is creating complexity for the lower cities who
are not much aware of upcoming technology or not aware of existing too. So we have
opportunity to target those cities which are not much popular and want to come up in term of
popularity.
Threats:
Everyone is working on technology to come up with new ideas so there is a threat for our
company to handle the competitors which are using bluetooth and WI-FI modules against our
automation system through access of internet by the single click on an application.
Unique Value:
The unique value proposition in our automation system is to control your home by a single click
with the help of internet access. This will enable our users to control their appliances, locks and
what they want to control just through internet if they are not available at home.

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Marketing Mix/5 P’s
The marketing mix strategy of Auto Control Company on creating and developing a corporate
identity that clearly defines our market niche in terms that benefit our customers to help them
in automizing their home appliances through internet doesn’t matter where are they.
Product:
 Mobile application for automation of home appliances through internet
services.
Services:
1. Control AC through Internet from anywhere by just a single click on your
mobile application.
2. Doors to lock them through internet.
3. Kitchen wares controlling through internet.
4. Fans controlling with a single click.
5. Control of lights through internet access.
Price:
Because of home automation is already available in
market through mobile applications using Wi-Fi and Bluetooth
services and this automation is change from that because this
access internet to automate appliances so it can be expensive
but we will launch in reasonable price 70-80$ so that people
can enjoy our services for easiness of their life.
Place:
This product is going to be launched in Lahore, Pakistan by Auto Control Company. It will
be marketed through social network in all over Pakistan.
Promotion:
Our experience after analysis of similar businesses shows that advertising costs
can easily crush a startup company, so keeping marketing simple, creative and cost efficient will
be challenging. Cost effective use of marketing is one of our keys to success.

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We will use guerilla marketing for the promotion of our product. Through below strategies we
will promote our product in market:
1) Through visiting malls and different appliances shops/stores to promote our product of
auto control by organizing events on the respected locations and involving audience
through some funky moves and engaging them into event.
2) Through social media like Facebook, twitter, Instagram, and many other social network
communities.
People:
We are targeting those people/ small cities who are interested in automation of
appliances through internet from a distance from their home for the easiness of their life. The
new feature we are introducing in our product is the automation through internet in which
doesn’t matter wherever you are. Just access your application through internet and automate
your appliance through internet and make your life easier.

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Financial Plan
List of Resources:
Sr. No. Description
1 Laptop/PC
2 Internet
3 Electricity
4 UPS
5 Sensors
6 AC
7 Furniture and Fixture
8 Office Rent & Advance
9 Digital Marketing (SEO/SMOs)
10 Technical Resources
11 Miscellaneous
EstimatedCost ofabove Listed Resources:
Sr. No Description No. Of Units Cost per Unit
(Rs.)
Amount
(Rs.)
1 Laptop/PC 03 40000 120000
2 Internet 01 4000 --
3 Electricity -- 10000/month --
4 UPS 01 24000 24000
5 Sensors 10 500 5000
6 Furniture and Fixture -- 5000 5000
7 Office Rent & Advance -- 7000 7000
8 Digital Marketing (SEO/SMOs) 3 months 5000 15000
9 Technical Resources 5 -- --

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Equity and Debt Financing:
Equity Financing = 100% (it is an owner’s equity)
Debt Financing = 0% (it is a loan)
1. Operating Cost and Expenses
Sr. No Description
Per Month
Cost (Rs.)
Total Cost Per
Month (Rs.)
Annual Cost
(Rs.)
1 Technical Resources 18000 * 5 90000 1080000
2 Electricity 6000 6000 72000
3 Rent 7000 7000 84000
4 Internet 4000 4000 48000
5 Miscellaneous 5000 5000 60000
Total 112000 1344000
1. StartupFinancing:
Sr. No Description Amount (Rs.)
1 Total Capital Expenses 176000
2
3 months Operating Expenses
(112000 * 3) 336000
Total Startup Financing 512000
Total 176000

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2. Revenue Generation:
Assuming the price of product is Rs.15000 and we will sale minimum 100 products in a
year.
Revenue = Price of Product * No. of Units Sold
Revenue = 15000 * 100 = 1500000 Rs.
3. Depreciationon Fixed Assets:
Sr.
No
Description
No of
units
Cost per
unit (Rs.)
Total
Amount
(Rs.)
DepreciationRate
%
Depreciation
Expenses(Rs.)
1 Laptop 3 40000 120000 20 % 24000
2 AC 1 50000 40000 20 % 8000
3
Furniture &
Fixture
-- 5000 5000 20%
1000
4 UPS 1 24000 24000 20% 4800
Total 37800
4. Income Statement:
Net Income = Revenue – Expenses
Description
Amount
Less: Operating Cost and Expenses
Revenue 1500000
Operating Expenses 1344000
Depreciation Expenses 37800

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Total Expenses 1381800
Operating Income 118200
Less Tax (20%) 23640
Net Income After Tax 94560
5. Balance Sheet:
Assets
Amount
(Rs.)
Liabilities & Equity
Amount
(Rs.)
Laptop 120000
UPS
24000 Debt 0
Furniture & Fixture 5000 Equity 507000
Building Advance 7000
Preliminary Expenses
(Marketing) 15000
Working Capital (3 months
expenses--112000*3) 336000
Total Assets 507000 Tota Liabilities & Equity 507000
6. Break Even Analysis:
Break Even = Total Annual Expenses
Per Product Charges
Break Even = 1344000
15000
= Approx. 89 Units

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7. Ratio Analysis:
a. Net Profit (Return on sale) = (Net Profit / Revenue)*100
Net Profit (Return on sale) = (94560 / 1500000)*100
Net profit (return on sale) = 6.304
b. Return on Investment = (Net Profit / Total Investment)*100
Return on Investment = 94560/1344000*100
Return on investment=7.036
8. Operating Cash Flow:
Operating Cash Flow = Net Profit after Tax + All Non-Cash Expenses (e.g.
Depreciation etc.)
Operating Cash Flow =94560+37800
Operating cash flow= 132360