REPORT

ON AN ECONOMIC PROJECT

“UNDERSTANDING THE BUSINESS OF A SMALL RETAILER”

SUBMITTED BY:-

AMIT MEHLA (PGDM-G LBSITM)

SUBMITTED TO:-

PROF. MEGHA JAIN

DATE OF SUBMISSION

01 JAN 2015

INTRODUCTION

DevIn Infotech is a small Xerox and internet cafe shop in Vijaynagar, Indore established by Devendra Kumar on 5 August 2013.

In his shop he has a Xerox machine for providing xerox copy, colour printer and 7 computers for the use of internet cafe. Besides that he also sales stationery items and recharge coupons of different mobile network providers. In this report we try to analyze when his breakeven point reached and what’s his monthly total revenue and profit.

First of all we summarize his initial capital that he put when he established his shop followings are the items and there cost:-

Items Cost (in Rs.)

Xerox machine 2,00,000

7 computers 70,000

Epson colour printer 10,000

Table chairs 4,500

2 Fan 3,250

2 Tube light 650

fitting charges 13,000

Total =301400

So Devendra Kumar start with initial capital of Rs. 301400 it doesn’t include initial advance monthly rent that cost him to Rs. 15,000 monthly.

Now let us see his monthly cost on stationery and other items

Items CostShop rent 15,000Electricity charges 4,500 (app.)Recharge coupons 5000A4 sheets bundle(100 bundle) 17,00012 dozen pen 575File cover(150 cover Rs 7 each) 1050File cover2 (100 covers Rs 17 each)

1700

Natraj pencil HB (10 pack) 250Broadband charges 1100Envelope white 100 pcs 60Envelope A4 size 100 pcs 350Calculator citizen 30 piece 3000Navneet registers ( 100 pcs) 3300Classmate registers (100 pcs) 5650Rough registers (100 pcs) 2500Other expenses 1000Total =62035

Here we assume he only buy Navneet registers of MRP 35, Classmate registers of MRP 60, Rough registers of MRP 30 only and MRP Rs. 5 pens only. We take above listed products on an average he can purchase more then it if he found demand is very high or even less then it when demand is low generally during schools and colleges holiday.

Now while listing his sales or profit we are assuming that items that he purchase in a month he sold out all below is the list that he charges from the customers

Items Amount that he charge SavingRecharge coupons Based on customer

requirementRs. 0.075/Rs. 1

A4 sheet printout Rs. 1/each printout Rs. 0.66/printoutA4 sheet xerox Rs. 0.50/each xerox Rs. 0.50/XeroxInternet printout Rs. 10/each printout Rs. 9.66/printout