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BUSINESS OPPURTUNITY

In an ever changing fast paced world, where the trend is drastically shifting towards nuclear

families, both the parents of the family being employed and having very little time for their children, the

focus is shifted towards how one can make this little time spent with their little children momentous. In

a nuclear family the parents get to focus all their efforts and concentration on their children only to

ensure that they remain happy all throughout. Hence the growing number of nuclear families have

given an impetus and also created a need for an industry that provides services specialized only for

children

Birthday is one occasion that is most awaited every year both by the child as well as his parents. All

parents would like to make their child’s birthday a special occasion that is ever remembered by their

child. In addition with the increasing purchasing power, parents care little about the expenditure to host

a grand show for their children. However, the constraint lies in the event planning and organizing of the

special occasion while parents are consumed with their works. Here lies the opportunity to develop an

event management service for kid parties that would relieve the parents of the burden of planning

the event and enjoy the celebrations without any stress and strain. The industry catering to such

specialized services is very limited in BHUBANESWAR which gives a potential for such a segment to

grow.

Apart from catering to the demand of a working family having heavily burdened office, such a

service would also take care of the demands of the social world organizing a special occasion of

special recognition with utmost professionalism and dedication.

BHUBANESWAR’s growth has been exponential, both in terms of its urban sprawl and

population. BHUBANESWAR’s population is presently estimated to be 80,84,676 which comprises of

7,09,838 children belonging to the age group of 1-7 years i.e. almost 10% of the population.

Further, BHUBANESWAR’s population growth rate has been 35% and is expected to touch 1 crore by

2012. However, considering the urbanization pace in BHUBANESWAR agglomerate that has

contributed to the shifting of population to BHUBANESWAR, the figure of one crore is estimated to be

reached much earlier. All these statistics indicate that there is a wide market that could be catered to

both at present and in future.

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PRODUCT/SERVICE:

“SPARSH” is primarily a service business that will offer personalized service to our clients with respect

to the event management of their kid’s birthday party. It will specialize in organizing children’s birthday

parties entirely, right from sending invitations, setting up the party to clearing away so that our client’s

can relax and enjoy their child’s big day. Our range of services includes:

1. Designing and printing invitation cards as per the requirements of our clients and sending

them to the guests who are to be invited.

2. Venue finding services to fix a venue for the party to be conducted after taking into

consideration factors like accommodation for the number of people invited, the amount our

client is willing to pay for the venue etc.

3. Providing decor services to transform or give a new look to the party venue that stimulates

children. The decoration services can be availed from the basic party ware with balloons to a

more extravagant themed party dressing with props.

4. Conducting games and activities, where in lies the thrust of the party fun. Our task would

include, organizing creative games and events for the children creating a fantasy world,

providing both visual and audio entertainment such as action, dance floor etc.

5. Catering service would include the provision of tasty healthy and innovative food for children’s

parties which could be tailored to the theme, accommodating special dietary requirements

including organic menus

6. Arrangement of the right type of return gifts or goody bags depending on the requirements

of our clients

7. Photography services: we would also have a photographer present at the party to capture the

sweet memories of the child.

8. Clearing up services so that the parents can relax at the end of their child’s big day

Customers can either book for the whole package or any one or more of the services depending on the

requirements or budget.

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Unique selling proposition (USP)

1. Our service is personalized service catering only to a special segment of the society, hence

having a greater caliber to serve the segment in comparison to a generalized service provider.

2. By aggregating a complete range of party related services, “SPARSH” will offer its customers

the ease of one stop shopping.

3. The principal USP of our service will lie in the expertise hired, which will be engaged in

providing unmatched services with utmost professionalism ensuring maximum efficiency while

minimizing the possibility of error. This will place us in a competitive position as a premier

provider of party management services.

MARKET ANALYSIS

Target market and customer profile:

Our target market may be divided as follows:

1. Age group: we would mainly target parents of those children belonging to the age group of 1-7

years. Most parents are highly ecstatic about their child’s first birthday, however many parents

would also like to celebrate the on coming birthdays to satisfy their child’s desire. The age group

is not restricted to 7 years as the child nor do the parents desire to celebrate the birthdays in a

grand manner any further. But this may not be the case in all situations.

2. Income group: our target markets are middle, upper middle and the upper income group

families, couples or individuals of BHUBANESWAR. We choose these groups because they are

most able to afford as well as willing to pay for such a service.

3. Working class: the fast pace of life we live in leaves very little time for extra things we would

like to, and one such thing is the planning of our lovely child’s birthday party. Thus this service

is targeted to the working class who cannot find time out of their busy schedule to plan such

parties. “SPARSH” will fill this need by being available to take on the burden of planning so that

people can spend time on more important things, like family and friends. Further the

overwhelming detail needed to plan a good show for your child is too large a constraint to place

on people not trained in the area of event management.

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Competitors:

“SPARSH” is in a unique position of competition. Though the number of firms offering children

specialized, event management services are limited in BHUBANESWAR, they posses the advantage of

being in the market longer and thus having more experience, established reputation and client base.

Another group that could be listed as competitors are the people who wish to organize their own events

without the benefit of assistance as it will help them to internalize the cost planning and also will be able

to add personalized touches that have meaning with in the family.

However our group of talented and creative expertise will help us overcome these competitors and

create an unparalled service.

Market growth:

BHUBANESWAR’s population growth has been 35% and is expected to touch 1 crore in near future.

Increase in population implies increase in the number of children belonging to the targeted group and

hence more birthday parties. Further the demand for this service can also increase considering the rise

in income and the corresponding purchase power in the hands of the urban population and also the

growing needs for building interpersonal; relations within the family and social groups.

Place:

The “SPARSH” office will be located inside the city limits of BHUBANESWAR on M.G.road as it

is easily accessible and well known location which would provide the ease of location and save time

of our clients to reach our office.

The office space required would not exceed 500 sq ft floor area as it has to accommodate only the

administrative staff. The other employees will mainly be engaged in the field work and will not require

an official environment to work in. Since initially we plan to open only one branch, for the purpose of

convenience to customers we would also encourage meeting with clients in social settings such as

restaurants, coffee houses, the clients home and also take orders over phone. When the company

accomplishes considerable growth in terms of revenue and profit we will extend branches in other parts

of the city.

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The office environment will display a high degree of professionalism in terms of its working and will be

equipped with the latest business technology such as telephone systems, computers, fax machines,

printers and software. The office will have a secure storage area of supplies and equipment used in

events like decoration items, cameras etc.

Promotion:

As stated earlier, that our client base is predominantly the middle to upper income group families and

individuals. Hence, we must take care that majority of this market’s needs are catered to. Our marketing

must, thus convey them the idea of releasing them from task, freeing their time for family and friends

and promise of a worry free event. Keeping in mind these aspects, we have developed our marketing

strategy as follows:

1. Hoardings: Attractive hoardings appealing both to parents and children will be placed in

strategic areas like Malleshwarm, Commercial Street, Kormangala in order to have a wide and

mass appeal, spreading awareness regarding the existence of our business.

2. Internet advertisements: Since internet is being used by people almost everyday,

advertisements in the form of pop ups on recognized sites like Yahoo and Google would also

help in capturing the target market.

3. Print advertisements: We will tie up with newspaper agencies to distribute the attractive

pamphlets containing services offered by us on a door to door basis in selected localities

4. Word of mouth referrals: Since this is a service based business, our marketing would be

predominantly by word of mouth as this will help generating sales leads the local community

through customer referrals. This will require developing affiliate relationships with not only the

customers but also other product and service providers like caterers, wholesalers of decorations

and other party items etc who also gain from the growth in our business.

5. Quantity based discounts: Discounts based on the number of services availed of and number of

people to be catered to will be given

Pricing:

‘SPARSH’ deals with a diverse range of services. Hence, the pricing will vary depending on the number

of people to be invited, the choice of venue opted by the clients and the specific services to be availed by

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the client. The prices of each service rendered will be based on the current prices prevailing in the

market and will also depend on the pricing strategy of firms providing us the materials to conduct

events.

Assuming an order for 150 people our price for full event management service will range from Rs

50000 to Rs 120000 which includes the cost of hiring the venue, cost of purchase of material required to

conduct the event, cost of services provided in the form of conducting activities and games, cost of

printing and distributing invitation cards and profit margin.

Sales forecast:

By beginning on a smaller scale, SPARSH has the foresight to grow at a rapid pace to keep up with the

demand we wish to maintain a steady rate of sales growth. We expect to have at least one client per

week in the first six months giving us an average estimated revenue of Rs 20.40,000 for the first six

months. We expect to increase by 20% half yearly based on the increasing awareness of our service.

The projected sales (in terms of revenue) are shown below:

1st Year 2nd Year 3rd Year

1st

6months

2nd

6months

1st

6 months

2nd

6 months

1st

6 months

2nd

6 months

Projected

sales

Rs. 2040000 Rs. 2448000 Rs. 2937600 Rs. 3525100 Rs. 4230000 Rs. 5076000

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ORGANISATIONAL PLAN:

The management team of “Sparsh” will be small in the beginning and as the sales increase the

organization structure will also broaden.

The primary employee is the founder i.e. AMITA.N.JIVRAJANI who will supervise all event plan and

execution. The organization structure will be as follows:

The administration team will comprise of employees to take and confirm orders after giving a

Description to the clients about the various services they can choose from, to maintain

Stores account of decoration materials in stock, to attend enquiry calls, to deal with caterers and maintenance of books of

accounts etc.

The event management team will consist of the people who will actually execute the work at the party

venue. This team will function as one with constant communication through weekly staff meetings,

email, and message boards. All jobs are interrelated. The performance of one effects that of the other;

each team member expects nothing but best from each other

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EVENT MANAGEMENT TEAM ADMINISTRATION TEAM

EVENT ANDACTIVITIES ORGANISERS

INTERIOR DESIGNERS

OWNER / PROPRIETOR

DECORATORS

Should Sparsh grow beyond its estimated size, more positions in specialized areas will need to be added

as well as additional site support and office assistance. To fill these positions it is looking for energetic,

teachable, detail-oriented persons who want the potential to grow and improve their skills within the

organization. Sparsh to be the best; therefore, they will hire those who want to succeed.

OPERATIONAL PLAN:

‘SPARSH’ will start its operations from its office located on M.G.road by sending direct emails to

parents of young children in BHUBANESWAR. The mailer will announce open house invitations to

visit the facility. The operations of the firm are associated with the services provided and hence are

listed below:

1. Invitation cards: We will have tie ups with local printers providing us their services at

reasonable rates. However the designing of these cards will be done by creativity specialists

hired by our organization having qualification in animation or any similar field. The distribution

will be done either through post or courier services as desired by the client. We would also use

personalized communication media like emails and telephones to add a personal touch to the

process. This service will be offered at the discretion of the client.

2. Venue finding services: Sparsh will have tie ups with different party halls in different locations

covering the entire city as well as different party halls having different rental prices providing an

elaborate list for the customers to choose from.

3. Decoration services: We will have fixed local providers of decoration and party items from

whom we will purchase decoration items as and when needed. The firm will also keep stock of

the frequently used items so that it does not suffer from shortage of such material at any point of

time. The organization will hire an interior designer who will work in co-ordination with the

team of creativity specialists (hired for the purpose of designing invitation cards) to decorate the

party venue giving it an innovative look

4. Games and activities: This would require the assistance of well experienced youth who would

energize the party environment with their ability to stimulate the children, excellent

communication and event management skills. They will also take care of the visual and audio

entertainment at the party venue. Our entertainers will arrive 30-60 mins before the party to set

up.

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5. Catering: We will have tie ups with “SAGAR CATERERS” for providing the mouth watering

food making it a perfect day and the cakes will be ordered from the “SWEET CHARIOT”

Centers for they can be trusted for the quality of their products.

Party Booking:

To ensure that our clients get the party they require we would recommend that the clients book at least

6-8 weeks in advance so that the arrangements regarding party venue and distribution of invitations can

be made

The booking will be confirmed on receiving 50% of the entire cost of the event management as an

advance deposit.

All prices will be subject to change at any time with the exception of confirmed bookings. The final

payment will be due 7 days before the party date.

Written notification expressing the clients wish to cancel the party is required and the following charges

will apply

More than 42 days- 0%

29-42 days - 20% of deposit

15-28 days - 40% of deposit

8-14 days - 60% of deposit

7 days - 80% of deposit

The above charges will be deducted from the deposit received at the time of confirming the order and

the balance shall be refunded back to the client.

The host/parent is responsible at all times for the general supervision of children within the party venue.

Our responsibility is strictly restricted to the supervision of party activities provided by us.

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Launch of our service:

We will have a launch party at our office located at M.G.road. We would also rent the vacant office

spaces around our office in the same complex to accommodate our guests. Our guests would include our

prospective business dealers i.e. party decoration item providers, caterers etc. we would also send

invitation cards to our target customers living in the vicinity so that they can take note of the facility

provided by us. The launch party will be on a Sunday there by giving an opportunity for most people to

come and know of our services.

FINANCIAL PLAN:

Start up costs and sources of finance:

A summary of the total initial funds required and the mechanism of their funding is shown below:

PARTICULARS AMOUNT(Rs.) AMOUNT(Rs.)

Start up costs:

Legal

Stationery etc.

Consultants (Lawyers, Real estate agents etc.)

Advance deposit (for renting office)

Advertising (Launch party, Brouchers etc.)

Miscellaneous

12,500

21,000

30,000

2,75,000

1,00,000

25,000

Total Start up expenses 4,63,500

Start up Assets needed:

Cash and Bank balances

Computers and Laptop

1,25,000

85,000

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Furniture and fittings 3,75,000

Total Assets needed 5,85,000

Total Requirements 10,48,500

Funding:

PARTICULARS AMOUNT(Rs.) AMOUNT(Rs.)

Owner’s Personal Funds:

In the form of cash

Sale of Investments (in shares and debentures)

Mortgage loan from bank

3,33,000

2,15,500 5,48,500

5,00,000

Total capital and liabilities 10,48,500

‘SPARSH’ wishes to be a debt free establishment. However, outside financing is the most viable option

to finance the start up costs. The cost of future operations of the concern will be financed from the

profits earned.

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The projected financials of the concern are shown below:

SPARSH

PROJECTED INCOME STATEMENT

PARTICULARS 1st Year 2nd Year 3rd Year

Amount(Rs.) Amount

(Rs.)

Amount(Rs.) Amount(Rs.)

Sales

Less: Cost of Sales

20,40,000

9,18,000

24,48,000

11,01,600

64,62,700

28,27,000

93,06,000

39,57,800

Gross Profit 11,22,000 13,46,400 36,35,700 53,48,200

Expenses:

Payroll

Sales and Marketing

Expenses

Depreciation

Maintenance and Utilities

Rent

3,60,000

4,28,000

23,000

5,400

1,50,000

3,60,000

4,28,000

23,000

5,400

1,50,000

9,50,000

8,96,000

46,000

12,000

3,15,000

11,40,000

7,20,000

46,000

12,000

3,30,750

Total Expenses 9,66,400 9,66,400 22,19,000 22,48,750

Profits before interest

Less: Interest

1,55,600

32,500

3,80,000

32,500

14,16,700

65,000

30,99,450

65,000

Net Profit 1,23,100 3,47,500 13,51,700 30,34,450

NOTE:

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Depreciation is charged at 10% p.a. on furniture, fitting, and computers.

Interest is charged at 13% p.a. on the loan taken from bank.

Rent per month is taken at Rs. 25,000 with an annual increment of 5%.

BREAK EVEN ANALYSIS:

Number of parties organized at break even point: 27

Revenue at break even point: Rs. 22,95,000

We will break even approximately in 7 months.

RISK FACTORS:

1. Though the current market for such specialized services is limited, there is a high scope for

growth which will encourage the entry of more firms thereby increasing competition.

2. Our services are dependent on the operational plans and strategies of our business dealers and

hence any changes in their working pattern may have an adverse effect on our business.

3. Our target customers are limited only to the population of BHUBANESWAR and thus a large

part of the national market is left uncovered giving a scope for growth to competitors.

4. Since ‘Sparsh’ is a service based business, hardships might be faced in convincing customers

about the quality of services provided.

MITIGATION OF RISK FACTORS:

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1. Concentration on advertising and promotional activities to spread awareness of services

provided on a larger scale.

2. Taking feedback from customers who have already availed the service in order to develop on

the loopholes and hence ensure quality services.

3. Leveraging the expertise of employees in providing better customer satisfaction in order to

competitively position ourselves as a premier provider of such specialized services.

4. Planning strategies for quick expansion to tap a larger market.

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