Investment opportunity under USD500K in distribution

Bullion International Pte LtdSingapore

10 Anson Road, #15-14International Plaza, Singapore 079903

email : [email protected] : 97854402 FAX : 62980746

Confidential

Investment Opportunity forExpansion Activities at BIPL

(Possibilities of working together in import/ export/ trading/ distribution)Business Proposal No.: BIPL/ PR/ 1116/ 2011

27th June, 2011

Prepared byMs Sujatha L Chamaria

for

Potential Investors, Marketers, Vendors and Business Partners

Terms of usage : Should you receive this document without the explicit permission or knowledge of Ms Sujatha L Chamaria or any officer of Bullion International Pte Ltd, you are hereby warned and informed that you are holding to confidential and sensitive information that you are unauthorized to read or own. Should you persist to read on or disclose the content of this business plan, we shall initiate legal actions against you to claim damages from you and to stop you from further distributing this classified material. Please delete this from your possession and inform us at the contacts listed in the letterhead with regards

to this leak. Our rights remain, fully reserved.




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Business Proposal

This business proposal has been written to present a business opportunities in import/ export/ trading and

distribution to potential investors, marketers, vendors and business partners. This is to assist in forming

the team and raising capital needed to expand the business and take it to market.

The Company:

Bullion International Pte Ltd (BIPL) is a Singapore company registered in August 1997. It is engaged in

general trading and wholesale commerce. The main operations of the company are in Singapore and

India. Some of the important products that the company has traded in the past are apparel, fashion

accessories, music cds, and computer parts and peripherals. It has also done contract manufacturing of

fashion accessories in India. The company has collaboration with a trader in India to trade steel and other

metals as well.

The strength of the company lies in the experience of the Director, Ms. Sujatha L Chamaria. Her

experience is connected with fashion and apparel, commodity trading and food and beverage and hotel

management. She is well versed with doing business in India, SE Asia, Europe and USA. Her profile can

be found on Linked In.

The Food & Beverage Trading and Distribution Opportunity:

BIPL has been invited by Dairy Farm, Singapore to supply Indian food and Beverages to their stores in

Singapore on a regular basis. This is in view of their newly formed direction to have dedicated aisles of

food and beverage catering to the growing expatriate Indian population in Singapore. The pilot project is

going to cover 3 Cold Storage stores which will be extended to other stores based on the results. The first

order is intended to be a mixed lot of food and beverages that can be shipped in a 20ft regular container.

Payment terms are 30 days, but sources advise that the trend is of payment in 90-120 days. BIPL

estimates that Cold Storage intends to order one such container every 2 months. The project will be

extended to chilled and frozen products as well at a later stage.




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Cold Storage has studied its requirements well, and know their target market. Their target market is the

growing Indian expatriate population that has newly arrived in Singapore and form the middle income

group. They are typically people who cook at home regularly and are forced to go to Mustafa because

they cannot find the necessities at a store such as Cold Storage nearby. They estimate that about 18,000

such persons come to Cold Storage regularly. Other markets that they have an interest in are other

expatriate Indians, local Indians and the expatriate population with an interest in Indian foods. They have

short-listed a few brands that they know their target market would want and have asked us to propose

other leading brands catering to both north and south Indian palates.

There is competition for this market. Mustafa has devoted a great deal of shelf space to service the Indian

consumer. There are also plenty of Indian foods and beverages in Serangoon Road. The advantage that

Cold Storage enjoys is proximity to its target market and just the right mix of necessities and products

that an Indian would need for their dietary habits. However, competition for Cold Storage need not mean

competition for BIPL in the long run. Going forward BIPL may be able to supply to other competing

stores as well.

To that end BIPL is already in talks with the other supermarkets, hypermarkets and convenience stores

such as Carrefour, NTUC Fairprice, Cheers, Sheng Siong and other banners of Dairy Farm such as 7-

Eleven, Giant and Shop n Save, for supply to their stores as well. BIPL intends to supply full container

loads where applicable and consolidated shipments in other products depending on the nature of the

demand. It intends to trade in full container loads at most times. However, it does not leave out the

possibility of stocking and supplying to the stores in smaller quantities.

To service the smaller market BIPL is able to procure a database of all the other wholesale companies,

hotels, restaurants, canteens, catering companies, ship chandlers, ship bunkering companies, mini-marts

and mom and pop stores islandwide. Local delivery maybe required for this channel for which a small

van with a driver can be hired on a daily basis at a charge of SGD180/ day. Ample local warehouse space

is available at affordable prices.

Pricing will be as per local standards. While Cold Storage would like to match prices with Mustafa it

may not be a practical option. Typically Cold Storage prices are 15-25% higher than similar or same




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products at Mustafa. This disparity may remain with BIPL product offering as well. The gross and net

profits for BIPL still need to be worked out. Cold Storage margins are still not confirmed but are

estimated to be in the range of 30-40% of retail price.

The vendors for these products are intended to be distributors and stockists of food and beverage

products in India. For some of the products, BIPL is already in talks with manufacturers for

distributorship rights. It is expected that attractive terms will be made available to the right

opportunity.

The Stationery Trading and Distribution Opportunity:

BIPL has acquired distributorship rights, for the Singapore market, of the leading pen manufacturing

company of India, Linc. Linc is a mass market pen which is of superior quality and with affordable pric-

ing. This makes this product a winner in every market that it enters.

Stationery, especially pens sell at a healthy margin in Singapore. With a policy of everyday low prices

and no discounting, BIPL intends to garner a fair share of the market. To that end the company is already

in talks with the stores for vendor rights. The response is encouraging.

Stocking of pens will be required. Only 6-8 sku will be chosen with care based on market study and input

from the retailers and manufacturers.

Distinctive Competence:

BIPL is uniquely positioned to take advantage of this market opportunity due to the following reasons:

1. BIPL has an ongoing contract with Dairy Farm for which the vendor account opening fee has al-

ready been paid. Other leading stores are willing to open an account with BIPL based on the of-

ferings and market potential.

2. Both India and Singapore are known to the company. It has been doing business in both

these markets for over 14 years.




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3. The buying power of the expanding expatriate Indian population is increasing.

4. The non-availability of cooked ready meals suitable for the Indian palate at affordable

prices, island-wide forces Indians to cook at home.

5. Traditional ties with home-cooked meals are a trend among expatriate Indians.

6. Time is of the essence, with greater workload and double income families.

7. The population in Singapore is growing allowing for more people to enter into trading and distri-

bution of traditional products.

8. The entrepreneurs, behind the project have knowledge and experience in international trade and

food and beverages and apparel.

Manpower Strategy:

BIPL would need to operate in all three product lines to achieve economies of scale. A small team com-

prising of the Promoter, Ms. Sujatha L Chamaria, and an operations executive is planned. The delivery

will be outsourced to a logistics company at SGD180/ day for 8-12 locations. It is anticipated that the van

would be used 2 days a week by the end of the 1st year. The accounting function will be outsourced too at

$400/ month to an accounting firm.

Financial Strategy:

The first 6 months’ sales are estimated to be approximately SGD500k. Going forward the sales is esti-

mated to be approximately 1.5mio/ annum. Other expansion possibilities exist as discussed above, but are

yet to be computed. Net profits are conservatively estimated to be in the region of 8-9% of sales. While

no debt financing is proposed an interest component has been taken in the calculations. This takes the to-

tal net profit to approximately 15% of sales. BIPL requires an investment of SGD625k over 6 months to

carry out the business. Thus the intended return on investment is approximately 30% per annum.




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BIPL needs capital to carry out this business. It also needs risk taking ability of the investor to assume

the financial risk of the transactions. BIPL would like to work as a working partner for the project. In-

vestors wishing to invest smaller or bigger amounts are also welcome to participate. There is immense op-

portunity in this rich market for everyday low prices player.

Exit Strategy:

The business is trading and distribution based and a large team is not proposed. The investor can exit

within 6 months of deciding to not operate the business further by liquidating the stocks or selling its in-

vestment to another person/ company.

Investment opportunity under USD500K in distribution

Business

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