STAR WASHING PLANT

PREPARED BY

TANZIRAL ZAHARA ZABIN – ID – 1030323

TAIYBUNNESSA WORTHI – ID – 1020690

FARJANA AHMED – ID – 1020720

NUJHAT MORSHED – ID – 1030458

COURSE ID – MGT 490

SECTION – 2

GROUP – 3

SUBMITTED TO:

MR. HANIF MAHTAB

The Business Description

First of all, I and three other friends of mine, altogether four of us are planning on

a business together. After some research and discussion, depending on our

investment amount, we make a decision to start our business in washing plant in

industrial garments. The garment textile industries provide the single source of

economic growth in Bangladesh's rapidly developing economy. Garments are the

principal source of foreign exchange earnings. Industrial garments’ washing is one

of the major important parts for textile sector. By industrial garments washing we

can remove dust, dirt and infections material. There are many types of industrial

wash. These are: Normal Detergent Wash, Bleach Wash, Stone Wash, Acid Wash,

Enzyme Wash, Combined Wash and etc. As our business will be small during the

initial stage, our financial structure will be small in the industry too. Starting as a

small business will increase and expand our working area in the future. Initially,

we will equally invest 15, 00,000 TK each in total 60, 00,000 TK. We spend this

amount of money for renting floor, office decoration, buying machineries and

chemicals, transportation and fees for permission.

Investment contract have to be gained to obtain permission from the board to

invest in the business. Then is the partnership deed which has to be managed to

get the joinstock certificates (proof that all the members are investing on the

business). City corporation trade license is also needed. Environmental certificate

is required for environmental issues. We have to take connection of electricity

and gas line.

In industrial washing sector, we serve our services to our clients like buying houses

and garments companies.

The Service or Product

Our service washing and drying is not directly serving people. Basically, it serves

other business organizations; it can be garments or buying house. We will wash

and dry different types of cloths – large recsin, twin pant, t-shirt, full-fit shirt. As

we are starting small, we will provide four types of washing activities. They are-

Normal wash

Enzyme wash

Color fixing wash

Each order will be taken on dozen bases. By using cost efficiency we will take less

in large quantity of order. Garments or directly buying houses can give us order.

Most of the time, the ‘buying houses’ arrange the orders for companies like us.

The ordering process is a huge system. Foreign countries give orders to the buying

houses.

Business Environment Analysis

Since our business plan focuses on washing and dyeing part of clothes, it’s a part

of the Garments Industry. We are working with a small sector (washing and

dyeing), where different orders come from different clients of different places

with fixed delivery periods.

There are many competitors in this industry. There are some large companies

who solely do all kinds of work, starting from washing, coloring, dyeing, stitching,

cutting and etc, however, small companies like us only concentrates on few

activities like we do in washing and dyeing. Different clients have different tastes

and demand, hence having customized orders and delivery within a certain period

of time. So, basically there are two types of competitors, one is the large

companies who solely do all the work, and another is the small companies like us

who concentrates on just few activities of the whole process. To reduce intense

competition, such business requires ‘Compliance Certificates’, it helps to ease the

work during high competition. It shows that the work done by the company is

done efficiently.

As such business is usually considered as B2B business (business to business), it

requires to contact the ‘Buying House’ where information of such companies are

available through which we can get our clients.

Industry Background

It is a portion of the Garments Industry, where lots of activities are done

(washing, coloring, stitching, dyeing etc). Our plan focuses on washing and dyeing

plant. There are two types of washing, Fabric washing is washing before sewing

the cloths, usually includes clothes that are large in length, such as bed sheets.

Another is washing after sewing the cloths which finishes the washing part. These

two types of washing include machine wash, hydro wash and dyer wash. Enzymes

wash or color fixing wash is needed only after sewing cloths.

The more we have machineries the more we can be productive and efficient.

Wash machine weighs 600 pounds, where the ‘machine wash’ activity is

performed; it can accommodate at least 200-250 clothes inside. So, if we get

order to wash 50,000 -60,000 pieces of clothes, we can just imagine the number

of times we will need to put clothes inside the machine, it will be 200 times. So

the more machineries we have, we can take more orders and since we are

starting new, we can start with just two wash machines weighing 600 pounds, one

hydro machine and two dyer machines.

It is more of a consolidated industry as there are many other small companies like

us, running the industry.

Expansion causing economies of scale will help us for future growth. Better use of

machineries, client loyalty, on time delivery, efficiency, productivity,

trustworthiness, and all these must be achieved in the short term for future

growth. Emerging of new machineries will help us to grow.

Every year the growth rate increases by 6%, we can predict from 1% to 2% or less

for our business in 2 or 3 years.

Competitive Analysis

As ours is a B2B business concern, our company is going to be unique compared

to other competitors in this field. It will mainly focus on delivering the service in a

way that it can be comprehensive and at the same time be cost effective as well.

Our company envisages a value-added approach to the work. Besides, we intend

to assist our clients to make business transactions in bulk quantities with the

minimum of effort and commotion. Our company also focuses on generating new

business relationships with various Textile companies. And our main competitors

are AGS Washing Plant, Dhaka Washing Plant, Indico Washing Plant, Shopon

Washing Plant and Moonlight Washing Plant. We believe that to stay ahead of our

competitors, we have to define our vision clearly. Such as, the company will

deliver service with utmost responsibility without making any error. We are

determined to put our best effort to deliver quick and flawless service. Aiming to

Achieve the most sought after best leadership quality in the arena of this

type of industry.

Provide high quality service and support to the satisfaction of concerned

clients.

Some of our clients may look for suppliers that will hold stock on their

behalf, provide technical consultancy and offer long-term support.

Keeping this in mind, we aim to have a clearer chart of our work that will

explain our promises and the service we will provide. Also, we intend to

maintain a strong personal relationship with our clients and develop trust.

As there is little scope for branding in this sector, gaining their trust would

help us retain customers.

8. Market Analysis

Most of the B2B market follows the 80:20 rule. It means a small number of

customers dominate the sales ledger. There are only few companies who can

make difference in revenue. Our main customers are Padma Buying House,

Southern Knitwear Ltd., Interloop BD Ltd. There are also few other companies

that are also considered as our potential customers. We believe that business-to-

business accounts are increasingly moving beyond requiring effective products

and services and good prices. Many of them are now looking for partnership. So

keeping this in mind, we will provide them dedicated value-added services that

reflect their importance to us. Based on this we divided our market into three

segments. They are:

A quality focused segment, which wants the best possible product and is

prepared to pay for it.

A service-focused segment, which has high requirements in terms of

product quality and range, but also in terms of after sales, delivery, etc.

These companies tend to work in time-critical industries and can be small

or medium. They are usually purchasing relatively high volumes.

A partnership-focused segment, which seeks trust and reliability and

regards the supplier as a strategic partner.

Our customers are regarded as long term customers. In order to meet their

expectations, we have to ensure that our services and intangibles meet and

exceed customers’ requirements. Also close attention to our target markets’

needs place us in a strong position to meet the needs of the market. Our target

audiences are smaller and place more emphasis on relationships. It also requires

face-to-face contact. So our sales and technical representatives who will visit the

customers have an in-depth technical understanding.

RISK MANAGEMENT PLAN

Risks are involved in every step of the whole washing and dyeing process. Risks of

damages such as, tearing of the clothes during a washing procedure, right amount

of color to be used, making sure the color of the clothes are not ruined, chemicals

have to used in right proportion to avoid such damages, also, heating should be

given in proper proportion through dyer, otherwise, it could cause damage to the

clothes. If such accidents happen, then we have to pay compensation. Clients may

choose not to pay a proportion of the entire bill based on the proportion of the

damage.

LOAN PROPOSAL PLAN

Since, our company will be a small washing and dyeing company, the amount of

loan to be requested shall not be gigantic. As we have mentioned earlier, that our

funding showed shortage of TK. 24, 00,000 (lakhs), we will be preparing a loan

proposal for that amount. The banks would want to know feasibility, assurance of

repayment and profitability in order to even consider looking at the loan

proposal.

We will make down payment of TK. 5, 00,000 (lakhs) and the remaining TK. 19,

00,000 will be through mortgage. We cannot give any of our private properties as

mortgage, as there are risks involved of not getting them back, such as,

machineries, if we fail to repay the bank will get hold of the machines. Therefore

we will give something that would not be such disadvantageous for us, such as,

the firm’s cover vans for mortgage. If by any chance, we fail to repay, the vans will

be taken by the bank, but even after that we will be able to rent other vans for

our use, so it would not be such an issue for our operations. As we do not own

any vans, when buying the van, the name under which the vans will be purchased

is of the bank. The bank will have the original papers of the van and we will have

the photocopies. We can use them and continue to pay installments until the

whole amount is repaid. Along with the loan amount, 18% interest rate will be

added.