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Marketing Project

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									    Marketing Project




      Fuel for Future
SUBMITTED TO: - Prof. Salman Mongol


                         SUBMITTEDBY:-

                       M Mahfooz Ayub         MBP-11319

                       Kashif Adeel            MBP-11334

                       Amazia Riaz            MBP-11307


                       Mohsin                 MBP-11345


                       Umair Shah             MBP-10129




                                      Superior University Lahore
Marketing Project                                                     2011



                                   TABLE OF CONTENTS

  1.   Executive Summary
  2.   Mission Statement
  3.   Biodiesel-A Brief Description
  4.   Environmental analysis
       A. The external environment
              Pest analysis of Pakistan
              Competitive forces
              Brand competitor
              Product competitor

  5. SWOT Analysis
         A. Strengths
         B. Weakness
         C. Opportunities
         D. Threats
         E. The SWOT matrix
  6. Project introduction
  7. Production Summary

  8. Marketing Plan
          A. Market Analysis
          B. Market Trends
  9. Marketing strategies
           Target Market
                 Demographic Characteristics
                 Geographic Characteristics
                 Psychographic Characteristics
                 Behavioral Segmentation
  10. Marketing Mix
           Product
           Product description
           Product performance
           Key advantages of Biodiesel
           Positioning
           Price
                                                       Superior University Lahore
Marketing Project                                             2011

            Promotion
            Below the line
            Above the line
            Distribution

  11. Sales plans
            Product Assortment
            Sale Strategy
  12. Milestone
  13. Risk Analysis
  14. Input Control Mechanisms
  15. Management
              Management Summary
              Organizational Structure
              Management team Requirement

  16. Financial Planning
             Project Financing
             Project Profit and Loss Reports
             Project Balance Sheet
             Key Financing Indicators
  17. Sales Plan
             Cost of Goods Sold
  18. Equipment




                                               Superior University Lahore
Marketing Project                                                                2011




                                Dedication
This report is a dedication to our gracious and beneficent parent and teachers. After the
grace of all mighty Allah, we are just because of these physical and spiritual parents

And especially this report is dedicated to our respected Sir Salman Khan Mongol
(Marketing Management) of Superior University Lahore




                                                                  Superior University Lahore
Marketing Project                                                                         2011




                          Executive Summary


Fuel for Future (FF) is a producer of renewableisand environment friendly fuel,in the Multan
 delivered from vegetable oils. The company located in the north Punjab,
                                                                                the biodiesel,

region, and it is intended to provide full technological cycle of production: cultivation of oil seed
(rape), processing them into oil and final production of biodiesel. Purpose of the business plans
is to attract investment in the creation of biodiesel production plant and rape cultivation
farming.

Our major advantage is the competitive price of the biodiesel, due to high productivity in
cultivation (the best soils in the world and favorable climate) and the lowest variable and fixed
costs in Pakistan (labor, land rent, transportation, facilities, utilities, chemicals).

We offer fuel with the same performance as that of conventional diesel, at competitive price
and ecologically safe. Our markets expand rapidly all over the world due to growing concerns
about levels of environmental pollution and limited supply of energy sources. Our target
customers are transport companies inside Punjab and the other provinces of country.




                                                                           Superior University Lahore
Marketing Project                                                                     2011




                           Mission Statement


F  F is a manufacturing company dedicated to developing better energy solutions for benefit of
   a whole society. We bring innovative technologies and unlimited supply of energy sources
without damaging and polluting environment.

Our product replaces conventional diesel and becomes the most perspective fuel of 21 century
due to its environmental friendliness, renewability and low costs.

Keys to Success

The key success factors in the biodiesel project are:

       Competitive Prices: Unless the importance of the biodiesel products is fully understood
        by consumers, we’ll not be able to sell it above market price of conventional diesel.
       Constant Product Quality: This makes sense in any case but because we are first on the
        market, good reputation and constant conformance to performance standards of
        conventional diesel are especially important.

       High-profile Management Team: products delivered on time, costs controlled,
        marketing budgets managed.




                                                                       Superior University Lahore
Marketing Project                                                                          2011




“Bio diesel isa avegetable oil- orenergy source that can befuel consisting ofvegetable oils”. It
  refers to
                  pollution-free
                                    animal fat-based diesel
                                                            produced from
                                                                               long-chain alkyl
(methyl, propyl or ethyl) esters. Biodiesel is typically made by chemically reacting lipids (e.g.,
vegetable oil, animal fat (tallow)) with an alcohol.

Biodiesel is meant to be used in standard diesel engines and is thus distinct from the vegetable
and waste oils used to fuel converted diesel engines. Biodiesel can be used alone, or blended
with petro diesel. Biodiesel can also be used as a low carbon alternative to heating oil.

Sources of Biodiesel:
Bio diesel can be extracted from following edible and non-edible sources: -

                            Non-edible                     Edible
                                  Pongame                Sunflower
                                  Castor Seed            Canola
                                  Jatropha               Mustard
                                  Jojoba
                                                          Rape seed


Benefits of Biodiesel

                                   Saving of precious Foreign Exchange.
        Economic                   Poverty alleviation by providing jobs
                                   Create additional revenue for farmer
        National                   Reduces Dependence on Imported Oil
        Security                   Sustainable, Renewable Resource grown domestically

                               
                              Control on emissions.
        Technical              
                              Provides superior lubricating properties.
                               
                              High detergent properties keep fuel lines, injectors, and
                              combustion
                         chambers clean fuel is a biodegradable and non-toxic clean
                             Biodiesel
                                    burning alternative fuel that comes from 100%
    Environmental                   renewable resources.
                                   Using biofuels as a vehicle for better farm, range, and
                                    forest practices can also help to achieve other goals such
                                    as reduced soil erosion and improved water quality

                                                                            Superior University Lahore
Marketing Project                                                                        2011




Biodiesel production and use is rapidly increasing around the world. A large number of
countries have instituted public policy initiatives to encourage biodiesel production and use,
and have done so generally through a combination of fiscal incentives and mandates or
voluntary targets.
A large number of countries have implemented public policy to provide incentives for the
development of the biodiesel industry. The view below displays how biodiesel is being adopted
around the world.
PESTEL Analysis of Pakistan
Political situations
      Political situations are the most influencing part of the government situation in which the
       change in the government policies can affect the organization.

Economical situation
      In this situation how can a change in the economical situation like decrease in currency etc
       can reduce the quantity of high foreign investors in the country and due to the heavy taxes
       imposed by government

Social situation
      To build up the trust of the people to cooperate with each other and with the organization.

Technological situation
      The progress of the country depends upon the progress of your technology. This is the
       another one factor influencing the country.




                                                                          Superior University Lahore
Marketing Project                                               2011




Brand Competitor

   PSO
   Shell
   Caltex
   Total

Product Competitor

    No Competitor

                        SWOT Analysis
            Strengths                    Weaknesses

   Less cost                    Newly enter
   No competitors               Finance problem
   Highly equipped machinery    Awareness
   Proper check and balances    Availability
                                 Storage, Bacterial attack


         Opportunities            Threats & Challenges

   Low maintenance              Natural disaster
   Environment friendly         Capacity limitation
   No import duty               Death of trained manpower




                                                 Superior University Lahore
Marketing Project                                                                     2011




                             Project Introduction
      Start-up Summary
      The start-up costs associated with legal expenses, maintaining office and facilities,
       salaries, etc are to be financed by direct owner investment. We expect investor to
       finance purchase of machinery, equipment, chemicals and fuel.
      Objectives
      1. Start production of biodiesel by the end of 2012.
      2. Provide fuel at lowest rate.
      3. Increase the sales to more than 50 million rupees by the third year.




                       Production Summary
Plant Location

The project is planned to serve Multan and neighboring regions. Total project’s area is
approximately 20,000 square km, of which the total arable land is 10,000 square km, that
includes 3,000 square km (200,000 ha) for rape cultivation.

Physical location of the processing plant is 20 km from Multan, near a railroad station and with
total storage and processing capacity of 400,000 tons of grain per year.

Company has the following facilities: garage for agricultural machinery with a total surface of
1,000 square meters, an administrative building of 100 square meters, and the plant building
for the biodiesel production of 1,000 square meters. Territory of the plant is fenced; available
for storage and other equipment in 5,000 square meters.




                                                                       Superior University Lahore
Marketing Project                                                                     2011




                             Marketing Plans
Market Analysis
Although biodiesel can be marketed as an ordinary fuel and our calculations in the financial
section are based on the present market price of conventional diesel, we believe, that most
perspective customers are farms, in-city transport companies and those who need the lowest
possible pollution levels in their technological processes: warehouses, owners of generators,
etc. The reasoning is the following: farms are suppliers of raw materials and can receive
biodiesel as a payment, in-city transport companies feel constant pressure to reduce their
fleets’ pollution levels and will be happy to buy biodiesel, and other users may also need non-
polluting fuel for such reasons as safety, comfort, ecological concerns. These customers will
definitely choose the biodiesel against the conventional diesel, if the product pricing is
approximately the same in both cases.




Market Trends
The most important trend in the fuel market is the growing prices. Although with some
limitations, this was true for years and seems to be accelerating due to political and economic
reasons. Biodiesel prices may grow even faster, because of its “ecological friendliness” and
concerns in all industrialized countries about the level of environmental pollution. It is
necessary to assume, however that because of a future increase in the biodiesel production
over the world and possible inventions of other alternative fuels (methanol, etc), prices of
biodiesel cannot exceed those of petro diesel more than 10% (as it takes place in Germany
now).

Our main competitors in Punjab are the producers of petro diesel. As long as the sale of petro
diesel is subject to excise and other taxes, our product would remain competitive on the Punjab
market. Biggest problem may appear if state imposes the above-mentioned taxes for biodiesel,
which however, is highly unlikely, because of the strategic importance of alternative fuels for
the country.



                                                                       Superior University Lahore
Marketing Project                                                                          2011




                           Marketing Strategy
1. Emphasize inherent qualities of biodiesel and focus on target markets.

We must differentiate biodiesel from other fuels. We need to establish our business offering as
a clear and viable alternative for our target markets.

2. Produce high quality fuel.

3. Offer competitive price at the level of the conventional diesel fuel.

4. Create strong distribution channels to ensure stability of production.

5. Emphasize key advantages of our product.

6. Build a relationship business: long-term relationships, not single-transaction deals with
customers.

Become their fuel supply department, not just a vendor. Make them understand the value of
our relationship for the whole society and economy.

7. Focus on fuel distributors and big consumers as key target markets




Target Market
Our target market is transporters, industrialists, Government and other people of Pakistan who
have vehicle, generators, and other machinery etc

              Industrialists
              Transporters
              Government
              Farmers


                                                                            Superior University Lahore
Marketing Project                                                                     2011




1) Demographic segmentation:
 Demographically we divide our market into 6 segments


      -   Age:
             Everyone who is using petrol/CNG for transport purpose.
      -   Occupation:
              Our main focus is on domestic users of any occupation.
              And our potential customers (family heads) belonging to any
              Occupation can avail our product.
      -   Educational Background:
              Not required.
      -   Income:
              People with income Rs. 20,000-25,000
      -   Gender:
             No gender specifications
      -   Family size:
             Family size doesn’t matter.


2) Geographic Segmentation:
  Right now we are focusing on local market Lahore but in near future we will be
  Focusing on the whole country Pakistan.


4) Psychographic segmentation:
 Psycho graphically we are focusing on these levels:


      -   Social class:
                 Social classes we are focusing on are:


                                                                       Superior University Lahore
Marketing Project                                                                           2011

                -elite class
                -upper middle class and
                -middle class
       -   Life style:
                Life style doesn’t matter to avail our services. People having any kind
                of lifestyle can visit our organization and avail our facilities.
       -   Personality type:
               Personality types doesn’t matter, person having any kind of personality
               can avail our facilities.


5) Behavioral segmentation:

       -   Loyal customers:
                We will be focusing deeply on our loyal customers who will stick to
                our services generation after generation rather than utilizing other
                Companies services.




                                 Marketing Mix
Product
Four products are planned to be produced and sold: biodiesel, rape-seed, rape meal and rape-
oil. Production starts with cultivation and harvesting of rape-seed, processing it into rape-oil
with rape meal as a by-product, and ends with the final production of biodiesel from oil. The
explanation for such a long technological cycle is a necessity to ensure the supply stability of
the raw material, the rape-seed, to produce final product biodiesel of premium quality.

              Product Description

Biodiesel is the name for the methanol-ester-based bio fuel made from vegetable oils or animal
fats. In this business plan biodiesel will be produced from rape-oil, but equipment could be
utilized also for processing other vegetable or waste cooking fats. Rape (canola), however has
proved to be a best crop for the production of biodiesel, because of high productivity and oil
content (45%).


                                                                             Superior University Lahore
Marketing Project                                                                       2011

Biodiesel is a clear liquid, without unpleasant odor or handling characteristics, of virtually the
same viscosity as mineral fossil diesel oil. For this reason, it may be used in a standard diesel
engine without additional modifications. It may also be blended with petro diesel to improve
quality of latter. There are also examples of crude rape-oil usage (not processed into biodiesel)
in specially designed diesel engines, or blended (50/50) with petro diesel oil in ordinary diesel
engines.

              Product Performance

Biodiesel shows similar fuel consumption, horsepower, torque, and haulage properties as
conventional diesel fuel and provides significant lubricity improvement over petroleum diesel
fuel. Lubricity results of biodiesel and petroleum diesel using industry test methods indicate
that there is a marked improvement in lubricity when biodiesel is added to conventional diesel
fuel. Even biodiesel levels below 1 percent can provide up to a 30 percent increase in lubricity.




Positioning
We’re positioning our product for those, who need and want to use non-polluting, ecologically
friendly fuel. Unlike mineral fuel, biodiesel is renewable energy source, with comparable cost
and performance.

Price
We must charge appropriately for this unique type of fuel, but we want also to predict
revenues as close as possible and to eliminate market risk, so we plan to sell biodiesel at
current market price for petro diesel.

            Key Advantages of Biodiesel
1. Biodiesel is the only alternative fuel that runs in any conventional, unmodified diesel
engine. It can be stored exactly like petroleum diesel.

2. Biodiesel can be used alone or mixed in any ratio with petroleum diesel.

3. The use of biodiesel can extend the life of diesel engines because it is more lubricating
than petroleum diesel fuel, while fuel consumption, auto ignition, power output, and
engine torque are relatively unaffected.

4. Biodiesel is a proven fuel with over 20 years of use in Europe and 30 million
successful US road miles.


                                                                         Superior University Lahore
Marketing Project                                                                 2011

5. Combustion of biodiesel provides over a 75- 90% reduction in environmental
pollution and a 90% reduction in cancer risks.

6. Biodiesel is the only alternative fuel to meet all environmental and human health
requirements for energy sources.

Promotion
We depend on direct contacts as our main way to reach new buyers. As we grow,
however, we need to change the way we promote ourselves:

Advertising: We'll be developing our core positioning message: "Fuel for Future" to
differentiate our service from the competition.

For promotion purpose, we have selected following promotional channels

We have total Budget for promotion of our product is 3.5 million rupees from which we
        spend 0.5 million on BTL promotion and 3 million on ATL promotion

                                       Promotion
             0.5 million Rupees


                             BTL, 0.5, 14%




                                                                                   ATL
                                                                                   BTL
                                                 ATL, 3, 86%



                                                               3 million Rupees




Below the Line (BTL)



                                                                   Superior University Lahore
Marketing Project                                                                       2011

Total budget for below the line promotion that is 0.5 million which is divided in
following

      Marketing at selected Bank branches which are financing for Auto loans.
      Marketing/Promotion at Suzuki/Toyota/Honda Showrooms
      Bill boards


                                  Below the Line
       3 lakh rupee                                           1 lakh rupee


                                      Bank branches, 1,
                                            20%

                                               Showroams, 1, 20%              Bank branches
           bill boards, 3, 60%
                                                                              Showroams
                                                                              bill boards



                                                                   1 lakh rupee




1- Marketing at selected Bank branches which are financing for Auto loans.
        That is the place from where customer get loan to buy vehicle if we advertise our
        product there it is good.
2- Marketing/Promotion at Suzuki/Toyota/Honda Showrooms
        That is the place from where customer buy vehicle that’s we should advertise our
        product there.
3- Bill board
        We are going to advertise our product on bill boards which are placed on all
        major roads.

Above the Line (ATL)
      Marketing at FM 103 selective shows
      Media Advertisements
         o TV
         o Print Media



                                                                        Superior University Lahore
Marketing Project                                                              2011


                                   Above the Line
       2.5 million                                        0.5 million
       Rupee                                              Rupee


                                   FM 103, 0.5, 17%


                   Media                                         FM 103
             Advertiesment, 2.5,
                                                                 Media Advertiesment
                    83%




Total budget for above the line promotion is 3 million rupees which is distributed in
media advertisement as 2.5 million and for FM 103 0.5 million rupees.
1- Promotion on FM 103

      We are going to advertise our product on FM 103 but in selective shows which is
popular

2- Media Advertisement

       We are going to advertise our product through media in which print and
electronic media both are included




                                                                Superior University Lahore
Marketing Project                                                                  2011

Media Advertisement




                              Media Advertiesment
    1.5 million Rupee                                          1 million Rupee



                                         Print Media, 1, 40%

          Electronic Media,                                               Print Media
               1.5, 60%
                                                                          Electronic Media




We distributed the media advertisement in to further two groups one print media and
second one is electronic media and total budget for media advertisement is 2.5 million
rupees one million and for electronic media 1.5 million rupees.

Electronic Media

Now a day’s many channels working some government and some private channels
some famous channels as following.

      PTV
      Geo TV
      ATV
      Dunya TV




                                                                   Superior University Lahore
Marketing Project                                                                            2011


                                         Electronic Media
       4 lakh Rupee                                                     5 lakh Rupee


                      Dunya TV, 4, 27%                    PTV, 5, 33%

                                                                                       PTV
                                                                                       Geo TV
              ATV, 2, 13%
                                                                                       ATV
                                                                                       Dunya TV
                                             Geo TV, 4, 27%



       2 lakh Rupee                                                     4 lakh Rupee



Total budget for electronic media is 1.5 million rupees which is distributed in four
channels according to their viewership as mentioned above.

Print Media

Now a day’s many newspapers publish there are some English and Urdu newspaper
mention below.

      Dawn News
      The News
      Daily Jang
      Daily Express




                                                                         Superior University Lahore
Marketing Project                                                                                 2011


                                             Print Media
        2 lakh Rupee                                                      2 lakh Rupee


                         Daily Express, 2,    Dawns News, 2,
                               20%                20%
                                                                                         Dawns News
                                                       The News, 2, 20%
                                                                                         The News
                Daily Jang, 4, 40%                                                       Daily Jang
                                                                                         Daily Express


                                                                              2 lakh Rupee
       4 lakh Rupee



Total budget for print media is 1 million rupees which we distributed in four news
papers we give 4 lakh to Daily Jang, 2 lakh to Daily Express, 2 lakh to The News and 2
lakh to Dawn News.

Distribution
We focus on the market need for environment friendly fuel distributed through the
authorized gas filling stations. We will also maintain close relationship with transport
companies and agricultural enterprises.

Strategic Alliances
We depend on our alliance with local producers of rape-seed to generate continues
supply of raw material in the future, with Multan diesel trader to ensure stable and
planned production and sales.

Because we plan to rent land and cultivate rape, cooperative agreement with
neighboring agricultural enterprises is essential. They are suppliers of labor force,
additional raw materials and equipment. We plan to outsource rape cultivation in the
future, so this cooperative would be a base for creating a suppliers’ network. This
cooperative would provide joint cultivation, harvesting of rape, production of vegetable
oils.




                                                                                Superior University Lahore
Marketing Project                                                               2011

           Future Products and Services
Glycerol is a by-product of our technological process, but it needs further cleaning. We
are not planning to install glycerol processing equipment in the first 3 years, because
this equipment requires additional 40% investment and we want to ensure quality and
uninterrupted production of biodiesel, as a flagship product.


                                 Sales Plans
Product Assortment
Biodiesel is planned to be sold using direct mail, seminars, promotion programs and
advertising in business newspapers. Because biodiesel is a valuable fuel for in-city
transportation companies, direct mail to these and other companies would be effective
tool in promotion. Ecology, energy, technology related seminars are effective in finding
regional representatives, partners, suppliers and buyers of our product. Promotion
programs are: discounts to those carrying our trademark and symbolic, support to
ecology and renewable energy concerned organizations, participation in regional fairs
and events. Total budget for all these programs is shown in the Profit and Loss
Statements, among the Advertising and Miscellaneous expenses.

Rape-seed is a commodity product which sells on agricultural exchanges, to producers
of rape-oil and exporters. We plan to contact directly all these customers, because they
are not so numerous and can ensure reliable business relationships.

Rape-oil sales are omitted from the business plan due to high uncertainty factors.
However, our plant will be able to provide this type of product and it remains a real
option for us to sell rape-oil.




                              Sales Strategy
Our major intention is to keep levels of monthly production, sales, and collections
together. For this reason we planned storage capacities only for one month’s
production, located plant near elevator (rape storage facilities) and railway
(transportation network). Because biodiesel is highly liquid product, this goal can be
implemented with right choice of distributors and suppliers.




                                                                 Superior University Lahore
Marketing Project                                                                  2011


                               Risk Analysis
All the three types of risks were analyzed in the risk pyramid: Country risk, Sector risk
and Company risk.

Country risk: Pakistan is regarded as a risky business environment, but conditions are
improving continuously.

Sector risk: The main sector risk is the unpredictable output of the rape in each year.
The necessary measures are assured in the project budget to cover this risk. The
appropriate cultivation conditions can be maintained by the proposed agricultural
equipment, moreover, insurance was also planned to cover weather risks.

Other part of the sector risk comes from the technology itself, the greatest threat may
come from latest developments in the biodiesel processing. A more cost effective
production method requiring totally new equipment could make our plant obsolete.

Company risk: Because of the newest technology, the company has a bit more risk than
that of a traditional firm. The highly qualified and fully committed management team
will do its best to decrease it as much as possible.

The overall risk of the project is moderate, which is expected to decrease over time.


                    Input Control Mechanisms
EFFECTIVE CONYROL SYSTEM OF FF

     Accuracy
     Time lines
     Economy
     Flexibility
     Understandability
     Reasonable criteria
     Strategic placement
     Emphasis on multiline criteria




                                                                    Superior University Lahore
Marketing Project                                                                 2011




                                      Corrective
                                        Action
                       Multiple
                                                        Accuracy
                       Criteria




         Emphasis
            on                                                        Timelines
         Exception
                                      ECS
                                      of FF
          Strategic
                                                                      Economy
         Placement




                      Reasonable
                                                        Flexibility
                       Criteria
                                     Understanda
                                         ble




     Types of control
FF is applying different types of control at different levels (head of departments) in
order to measure the performance closet to the standards (rules and polices defined by
HR) and to evaluate the efficiency of the organization.


      FEEDFORWARD CONTROL
      FEEBACK CONTROL
      QUALITY CONTROL



                                                                  Superior University Lahore
Marketing Project                                                               2011

FF is applying Feed FOWARD CONTROL at INPUT LEVEL and evaluate the resources
of the company .it is using FEEDBACK CONTROL at OUTPUT LEVEL and they get
this feedback from the customers. They keep channel open with the customers and
consider them as their partner and keep open communication. They also use QUALITY
CONTROL as modern controlling concept.




                          MANAGEMENT
Our management philosophy is based on responsibility, mutual respect and
entrepreneurial creativity. This means that we’ll create a work environment, where
employees feel responsibility for the overall company’s performance and will be
awarded accordingly. Although, better than projected results could be compensated
with bonus payments, the most general way of extra remuneration is planned to be a
centralized and controlled biodiesel product distribution for the workers (bonuses for
extra quality production and so on). The latter method could increase the interest, on
behalf of the workers, in working in our plant, and hopefully, it could help propagating
the Company’s environmental concern even further.




HRM manager knows that to remain competitive in today’s dynamic world he must
understand the psyche of his employees so that their needs can be fulfill and a
motivated work force can be created for them which will be a source of competitive
advantage over the competitors.

The policies and practices one need to carry out the ‘people’ or human resource aspect
of the management position including the recruiting, screening, training, rewarding.

As mentioned HRM consist of the following

     Recruiting
     Screening
     Orientation & Training
     Rewarding




                                                                 Superior University Lahore
Marketing Project                                                                2011




                              HRM DEPARTMENT




    RECURITING AND              COMPENSATION                  TRAINING AND
      SELECTION                 AND BENEFITS                  DEVELOPMENT




There are six employees the HRM Department

Recruitment

Internal Recruitment

     In FF, vacant posts are also filled internally to provide an opportunity for the
workers already working in the organizations.

External Recruitment

      In FF, fresh or experience candidates are also preferred and hired.

Selection Criteria

The selection is entirely based on merit which confirms to selection criteria without any
bias towards gender, religion, race, color, nationality, age and according to the
procedure laid down in the HRD policies.

Selection Procedure

     Filling out application forms
     Application screening (short listing)
     Test (Written and practical)
     Interview
     Final selection
     Orientation
     Training



                                                                  Superior University Lahore
Marketing Project                                                              2011

Hiring Process

Whenever the organization needs employees for internal job advertisement is made
only inside the hospital and for external job for the top level management and medical
staff advertisement is given in leading newspaper like DAWN and THE NEWS. Written
test and interviews are conducted only for the nursing staff and low level employees
and for top level management only interviews are conducted.




Contents

      Orientation normally covers the following contents.

     Welcome note from management director.
     Mission, Vision and Values.
     Brief introduction of FF
     Companies profile
     organization
     The working hour’s company’s profile.
     It also includes the fire training.




Training

      FF gives two types of job training.

1.    On job training.
2.    Off job training.



Training budget varies according to training type


                                                                Superior University Lahore
 Marketing Project                                                                             2011

 HRM Policies of FF

         Gender Justice Policy
         Sexual Harassment Policy


 Discrimination Policy




 Organizational Chart:

                                         Board of Governors




                       Kashif Adeel            Amazia Riaz
 Mahfooz Ayub                                                         Mohsin                Umair
                     Director Customer      Director Marketing
Director Operation                                                 Director Admin     Director Production
                          Service               and sales



                         Customer service
                                                 Manager product          Admin.              Production
                           compliance
                                                  development            Supervisor            Manager
                             manager




 Organizational structure

 The team includes 60 employees, fewer than five managers, acting as partner executive
 directors. No important decision can be made in one person; at least two executive
 managers should approve them.

 Our main management divisions are farming, processing, and sales. Farming handles
 cultivation of rape; processing-pressing of oil seeds and production of biodiesel.




                                                                                Superior University Lahore
Marketing Project                                                                  2011

List of departments:


      Sales
      Marketing
      Research and development
      Production
      Shipping
      Finance department
      Customer service
      Human Resource Department
      Admin department
      Operations
      Procurement
   

Management team requirements

We believe we have an excellent team for covering the main points of the business plan:
cultivation of rape, sale of final products. At present, we can improve mostly in the area
of technical capabilities to manage the production of biodiesel.




                           Financial Planning
In this segment of our document, we will cater following question



      How much finance is required?
      Where to get finance from?
      Utilization and recording of financial results?


How much Finance to start with…

We plan to start with 30 Million Rupees; the financing will be shared with percentage
mentioned below. For explaining more, percentage will be as follows:



   1- Muhammad Mahfooz                       7.0 Million

                                                                    Superior University Lahore
Marketing Project                                                                       2011

   2-   Kashif Adeel                         7.0 Million
   3-   Amazia Riaz                          7.0 Million
   4-   Mohsin                               4.5 Million
   5-   Umair                                4.5 Million



A tentative breakup of total sum which will be involved into different segments of project is:

Bio diesel (all expenses):


             Land and machinery
                                                                   20,000,000.00

             Premises Rent = 300,000 approx       for at least 6
                                                                         300,000.00
             Month

             Staff                                                       900,000.00

             Labor                                                       600,000.00


                                                                   21,800,000.00



             IT -Staff- Rent                                             3.01

             Fixtures - Admin                                             2.4

             Marketing promotion                                          3.5

                                                                         30.71



Our financial plan showing approx figure of 30 Million, which includes all major heads to
launch a new product.

Where to get finance from?

We have planning to get this amount financed through a bank or financing institute. But for
first choice we’ll get the investment from our families and personal investors after discussing
the plan and prospects of this venture.




                                                                         Superior University Lahore
Marketing Project                                                                        2011

We have a property to present for mortgage in case we go for bank finance. That will get us to
our required 30 Million initial investments.

Utilization and recording of financial results

We’ll use to state of the art accounting and asset/cash management system (software) for
recording of our financial activities. Accounting Manager will handle all financial activities and
observe the financial routines. We’ll review our financial reports generated by our accounting
system at every month start.

And after every 4 months we’ll conduct an internal audit in our organization to see and to
correct any financial disorder or management dysfunctional ties.

Projected Profit and Loss Reports

The financial reports are prepared in a yearly split; they were intended to be
comparable with each other. Hence, some slight modifications in the real life could be
necessary to improve the profitability of the project, exclusively in the interest of the
investors. Such changes may include an additional capital expenditure in fixed assets
for higher return in the optimistic case, if the cash balance is too high to keep it lying on
bank deposits without yielding interests.

Projected Balance Sheet

Here follow the balance sheets of the biodiesel project. Please note that in the first two
years of the pessimistic scenario, additional loans would be necessary to borrow.
However, in the third operational year, all these loans would be paid back.

                        NORMAL SCENARIO                       2012
                        Assets
                        Cash and Securities                   7,690
                        Accounts Receivable                   13,000
                        Inventories                           34,000
                        Total Short-term Assets               54,690


                        Capital Assets                        1,700,000
                        Accumulated Depreciation              50,000
                        Total Long-term Assets                1,650,000




                                                                          Superior University Lahore
Marketing Project                                                                     2011

                      Total Assets                        17,046,900


                      Liabilities and Capital
                      Accounts Payable                    16,000
                      Short-term Loans                    200,000
                      Other Short-term Liabilities        0
                      Total Short-term Liabilities        216,000


                      Long-term Liabilities               0


                      Total Liabilities                   216,000


                      Paid in Capital                     2,000,000
                      Retained Earnings                   0
                      Earnings                            -511,310
                      Total Equity                        1,488,690


                      Total Liabilities and Capital       1,704,690




Key Financial Indicators

The following tables include all the important key financial ratios related to the project:

                      PESSIMISTIC SCENARIO                2012


                      Profit Margin Ratio                 -639.0%
                      Total Assets Turnover Ratio         4.9%
                      Rate of Return on Assets (ROA) -31.5%
                      Leverage Ratio                      1.08
                      Rate of Return on Equity            -34.0%


                      Return on Investment Ratio          -29.0%


                                                                       Superior University Lahore
Marketing Project                                                                    2011

                      Days Accounts Receivable            26.1
                      Days Accounts Payable               11.2
                      Days Inventories Held               13.6


                      Current Ratio                       0.13
                      Quick Ratio (Acid Test)             0.06
                      Total Debt to Equity Ratio          15.8%




                                SALES PLAN
Capacity of the plant is 5,000 tons of biodiesel per annum. Rape cultivation costs are
expected to be the same in each scenario, the negative effects of the worse sales and
weather conditions cannot be compensated by lowering the cultivation costs.

COST OF GOODS SOLD

In this section we’ll indicate only such variable costs as costs of chemicals, fuel, energy,
rape-seed cultivation, fertilizers. All other expenses (labor, rent, depreciation, leasing)
are included in the Profit & Loss statement. Year 2012 contains a fraction of these costs,
due to the proportional usage of the economic resources.

Chemicals and energy

Energy Costs


No.                Name                      Quantity        Unit         Total         Rupee
                                           required per      Price      quantity        / year
                                               ton                      required

 1    Energy for production:                 100 kWh         0.046      500,000          23,000
      electricity, hot water,
      compressed air

 2    Fixed energy costs                                     0.046      108,700           5,000

      Total energy costs                                                                 28,000



                                                                      Superior University Lahore
Marketing Project                                                                  2011




Rape-seed

Total area of farm: 5,000 ha, Productivity: 15,000 tons of rape-seed or 5,000 tons of
biodiesel per year. Rape meal is a by-product of rape-seed processing.



Rape-seed Direct Cultivation Costs


No.           Name           Quantity per          Total           Price       rupees / year
                                 ha               quantity

 1    Fuel                       300 kg             150 t            79                  11,850

 2    Seeds                       15 kg              75 t           450                  33,750

 3    Fertilizers                 30 kg             150 t           230                  34,500

 4    Herbicides                  20 kg             100 t           230                  23,000

      Total                                                                             103,100


                               EQUIPMENT
Total cost of equipment is 1,540,000 Rupee out of which the capital expenditure in:

Farming 158,000 Rupee

Seed processing 64,000 Rupee

Biodiesel production 1,318,000 Rupee




                                                                    Superior University Lahore

								
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