Business Plan

Project of Ecommerce
Business plan of c2c website

Submitted to: Prof. Zeshan Shaukat

HAILEY COLLEGE OF COMMERCE

UNIVERSITY OF THE PUNJAB

Prepared by: Bilal Raja 792

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Contents
1: Executive Summary 1
1.1 Solution 1
1.2 Market 2
1.3 Opportunity 2
1.4 Financial & Capital Requirements 2
1.5 Objectives 2

2: Company Overview 2
2.1 Company Locations and Facilities 3
2.2 Mission 3
2.3 Ownership 3
2.4 Keys to Success 3
2.5 Management Summary 3
2.6 Management Team 4
2.7 Start-up Summary 4
2.8 Start-up 4

3: Market Analysis Summary 5

3.1 Market Growth 6
3.2 Competitive Analysis 6
3.3 Competitive advantage 6
3.4 Value preposition 7

4: Marketing Strategy 8
4.1 Strategic Alliances 8
4.2 Promotion Strategy 8
4.3 Marketing Programs 8

5: Sourcing 8

6: Technology 9

7: Milestones 9

8: Revenue Model 10
8.1 Transactions fee 11

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8.2 Advertisements on the eBAM.com 11

8.3 Subscription fee from companies 11
8.4 Sell of products placed by BAM 11

9: Financial Plan 11
9.1 Important Assumptions 11
9.2 Start-up Funding 12

10: Website 12
10.1 Address 13
10.2 Host 13
10.3 Domain 13
10.4 Payment 13
10.5 Security 13

1: Executive Summary

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BAM is a C2C website where interested seller can place their items for sale and
interested buyer can visit the website and buy items placed by other people.
This website will also provide additional space for companies to place their own
products for sale.
The main concept of the website is to provide space for Pakistani internet users
to sell and buy items online. As there are fewer trends for c2c internet
purchasing because fewer websites are this service in Pakistan so we have a
huge opportunity. We expect a huge visitor for this website. We will charge
transaction fee from the seller based on the face value of his/her item.
We are targeting about 18,500,000 Pakistani internet users.

1.1 Solution
Many people want to buy products on low prices. They prefer to buy 2 nd hand
goods rather than buying a brand new because they believe that 2nd hand goods
are in low price and as well as they and if they resale it they will get good return
in contrast to a brand new product resale price. E.g. in case of mobile phone.
And also many people don’t want to or they don’t have enough money to buy a
brand new product as they feel it expensive, so they prefer to buy a 2 nd hand
product.
Now the problem arise when someone sell his used product on a shop. The shop
owner will try to give a lower price of his product for maximum profit as he will
sell that product (which he bought on lower price) on higher price to other
customer. That is a loss for both parties i.e. is seller and buyer.
So to overcome that loss we have a simple solution. Consumer to consumer
buying and selling. In this, one consumer (that is seller) will place his product
for selling and the other consumer (buyer) will buy from the seller directly.
So both parties know what is the actual selling and buying price is! And will get
satisfy as they both get good value for the product.

As a value added service we will set a particular space for companies to sell
their product online on our website

1.2 Market

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We are targeting just Pakistani internet user which amount to over 18,500,000
users. This is a big market which is growing rapidly. Online purchasing trend is
growing rapidly. Banks in Pakistan are giving facility for online payments.
Pakistani internet user is get aware of consumer to consumer online purchasing.
So we can click in the start and become market leaders.

1.2 Opportunity
Everyone wants to get a good price of their products. It is commonly observed
that transactions between consumer to consumer give good prices as compare to
if it is sold on any shop. So we have great opportunity on internet to setup an
environment for consumer to consumer transactions. Many people will visit us
as they will get a verity of goods and on low cost as there will be also some
price competition. Because shops monopolize the market, consumers receive
only a fraction of the value paid for the product, typically 60% or less of the
purchase prices.  The shops then re-sell the product back to other consumer,
receiving over 125% profit.  The current situation creates a lose-lose situation
for consumers and a win-win situation for shops. Consumers are looking for
convenient, money saving ways to purchase products and to receive more value
when re-selling them.

1.3 Financial & Capital Requirements

According to the opportunities and requirements for bam.com described in this
business plan, we have determined the following financial projections:
 Generate exceptional revenues by the end of year one.
 Report profits during the 9th month of operation.
 Exceed a 1.5x increase in sales and profits by the end of year three.
The BAM.com will require an initial seed investment as well as later rounds of
investment.  The initial seed capital will be used for marketing and customer
acquisition, website development and payment procedures.

1.4 Objectives
The BAM.com will strive to achieve the following objectives:
 Become the leading Internet consumer to consumer marketplace
 Attract 10,000 registered users in the first year
 Achieve 10,000 visits per month
 Establish sustainable profitability within the first year

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2: Company Overview
The BAM was founded in May 2010 and is presently in its start-up stage.  The
BAM website has been in operation with limited functionality for last 2 weeks.

2.1 Company Locations and Facilities

E.shop LG25
Y block DHA
Lahore
www.ebam.co.nr
The BAM's data center is hosted and maintained by www.000webhost.com.

2.2Mission
To provide online space for selling and buying products in a consumer to
consumer environment. To become a market leader and serve our clients
to the best within a secured area and ensuring a successful transactions on
a minimal fee.

2.3 Ownership
The BAM is a subsidiary of E.shop.

2.4 Keys to Success

Our key to success will lie in our ability to execute our business model.  In
order to achieve success, we need to focus on the following areas to establish
The BAM as a successful and profitable enterprise.  They are:
 Recruit an exceptional management and marketing team with extensive
domain experience in the C2C market.
 Create and maintain a "Grass Roots" marketing campaign.
 Offer innovative and unique services.
 Form strategic alliances and partnerships with companies to sell their
products on our website

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2.5 Management Summary

The strength of BAM's management team stems from the combined expertise in
both management and technical areas.  BAM recognizes that additional staff is
required to properly support marketing, sales, research, and support functions. 
Currently, BAM is supported by four people with experience in e-commerce
strategy, website architecture and design and graphic design.  Additional
employees may be required in the areas of senior level management, Web
development, marketing, sales, human resources/recruiting, administration,
customer support and other critical operational positions.
BAM will utilize current college students to fill positions in the areas
of marketing, advertisement sales, administration, customer support other non-
critical operational positions.  These positions will be full-time, part-time and
intern positions. Using current college students will enable BAM to receive
inexpensive local employment.
BAM will utilize consultants and contractors during website enhancements and
development efforts.

2.6 Management Team

Our management team consists of three dedicated employees and one technical
advisor. 
2.7 Start-up Summary
Our start-up costs assumptions are shown in the following table and chart, and
include Web hosting, software, development and marketing expenses.  The
start-up costs were financed by direct owner investment.

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2.8 Start-up
Requirements
Start-up Expenses
Domain Name Registration Rs. 2000
SSL Encryption Rs. 3000
Site Certificate Rs. 2500
Classified Software Rs. 15500
Utilities Rs. 2200
Merchant Account Fees Rs. 25000
Computers (4 @ Rs. 40000) Rs. 160,000
Programming & Site Development Rs. 50,000
Site Hosting (12 months) Rs. 25,000
Miscellanies Expenses Rs. 5000
Beta Launch Promotions Rs. 10,000
Search Engine Registration Rs. 3400
Total Start-up Expenses Rs. 303,600
Start-up Assets
Cash Required Rs. 500,000
Other Current Assets Rs 50,000
Long-term Assets Rs. 300,000
Total Assets Rs. 855,000
Total requirement RS. 11,586,00 (12,000,00)

3: Market Analysis Summary

The Pakistani internet market is a growing on a high rate. PTA expects the
Pakistani internet market to grow from 12,000,000 users in 2006 to above
20,000,000 in 2012.  According to a report conducted on Broadband and
Consumer E-Commerce in Pakistan, at present e-Commerce in Pakistan is
feasible and recommended.

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3.1 Market Growth

Internet market is growing with increase in spending online by Pakistani user.

3.2 Competitive Analysis

Competitors of BAM include Pakistani c2c websites as well as international c2c
websites.
Our main competitors are:
olx.com.pk
pakbazaar.com.pk
Ebay.com

OLX Pakistan offers local classified ads for jobs, for sale, real estate, services,
community and events - Post your classified ad for free.
Analysis of olx.com.pk

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3.3 Competitive advantage

BAM will use introduce different services that will help it to gain competitive
advantage.

 Secure transaction procedures

 Placing low priced 2nd hand goods by BAM
 By giving and dedicated space to companies to place their brand new
goods for sale on our website
 Adding option for previews and comments
 Full privacy of our clients
 Ensuring successful transactions
 Banning spams
 Providing RSS and email lists to update our clients for products of their
interest.

3.4 Value preposition

 We will provide space on internet to sell and buy product for individuals
in an interactive website where customers have more options and variety
of products and prices.
 A secured place where one can trust us and do transaction with
satisfaction.
 To provide product previews for buyers so to help them in selecting
products.

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4: Marketing Strategy
BAM's customers will be the 18,500,000 Pakistani internet users. 
The main business model for BAM relies on customers selling products and
classifieds and product evaluations and reviews available on the website. 
Therefore, our focus will be on the marketing strategy to increase internet user
traffic and usage.  In turn, visitor volume and transactions will maintain the
inventory of products and services offered.
BAM recognizes the key to success as an extensive promotion strategy to attract
users.  Once additional funding is secured the advertising and promotion plan
will be implemented.
4.1 Strategic Alliances
BAM is looking to form relationships with major companies.  Companies that
we will approach included manufacturers or resellers, specialized content
suppliers, new and used product wholesalers and local businesses.
4.2 Promotion Strategy
BAM's overall advertising and promotional objectives are to:
 Acquire customers and generate sales.
 Position BAM as the market leader.
 Increase company awareness and brand name recognition among user.
 C2C market research to create immediate and long-term marketing plans.

4.3 Marketing Programs

BAM will attract customers by using a mixture of traditional and
online advertising strategies to create a grassroots marketing campaign. 
Since the majority of BAM's customer acquisition will result from direct online
promotion, BAM will recruit current college internet user to fill positions, local
advertisement sales and implementation of a "grassroots" marketing campaign. 
The following is a list of advertising and promotional channels BAM will
utilize:
1. Posting Flyer in and around college campuses, malls and shops
2. Direct Mailings
3. local newspaper advertising and inserts
4. Promotional item distribution
5. Sponsorship of national sport teams
6. Sponsorships of community events
7. Indoor/outdoor billboard advertisements

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8. Banner ads on related sites with a significant level of traffic

9. Links on related web sites
10. Traditional media including direct mailings, magazines, radio and TV
11. Registration with all the major search engines.
12. Add to cart option is given for convenience.

5: Sourcing
The main business model for BAM relies on internet users selling products and
classifieds.  Therefore, our focus relies heavily on the marketing strategy that
will increase traffic and usage and, in turn, maintain our inventory of products
and services. 
For the retail business component we will establish relationships with
manufacturers or distributors that offer drop-shipments direct to the customer. 
This will allow BAM to keep expenses associated with inventory and
distribution to a minimum.
For content and other value added service we will establish relationships with
3rd party vendors.  This will enable BAM to offer a wide variety of products
and services online yet allow BAM to focus on the key business elements;
selling and classifieds

6: Technology
The website is designed with the needs of the c2c consumers as the focus. 
BAM is built using Microsoft technologies which will provide the flexibility to
easily expand products and service offerings in the future.  BAM will initially
host the website with an external web-hosting vendor thus reducing initial start-
up cost.  At a later date, BAM may elect to bring hosting in-house for better
support and maintenance. 
The transaction, Classified, and User Administration software was purchased
from Xcent Software, Inc and modified to support BAM's business needs.  The
rights to the source code of the Xcent's software were included in the purchase
price of the software.  This will enable our programmers to customize the
software to support BAM's growing business needs.
BAM website and databases are hosted by 000webhost.com which guarantees
99.99% uptime.  In addition to Web hosting, 000webhost.com provides site
monitoring and statistical performance metrics that include uptime, page views,
unique users, banner impressions, search keywords stats and link stats from
other sites.

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7: Milestones
The accompanying table lists important milestones with dates.  The milestone
schedule also indicates our initial beta launch of the website.

Milestone Start Date End Date Department

Business Concept & Planning 1/5/2010 30/5/2010 Management
Beta Site Development 20/5/2010 1/6/2010 Web
Beta Site Launch 1/6/2010 30/7/2010 Web
Beta Site Promotional Campaign 10/6/2010 30/7/2010 Marketing

Beta Site Analysis 1/8/2010 15/8/2010 Web & Marketing

Secure Funding for Phase 1 Launch 25/8/2010 30/8/2010 Management

Phase 1 - Site Development 1/9/2010 30/10/2010 Web

Phase 1 - Launch 1/11/2010 30/11/2010 Web
Phase 1 - Promotional Campaign 10/11/2010 30/11/2010 Marketing

Secure Funding for Phase 2 1/12/2010 05/12/2010 Management

8: Revenue Model
Income of a firm/company is like blood which is necessary for successful
operations for years. Our revenue model will consist of main 4 parts

8.1 Transactions fee

Transaction fee will be charger from the seller who will place the product upon
successful delivery of goods.
Procedure of transaction will be that when the buyer confirm the transaction and
payment made to BAM, the seller upon getting a confirmation from BAM, will
send product to BAM and BAM will pay the seller upon delivery of the product
and send the product to the buyer.
In this process BAM will change transaction fee.

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8.2 Advertisements on the BAM.com

BAM will hire Google’s AdSense services and top banners will be placed.

8.3 Subscription fee from companies

Companies that will be interested to place their products on our website will
have to subscribe to our website. Companies, who don’t have online ecommerce
websites, have great opportunities to sell their products online with less
expense.
They will also be changed transaction fee.

8.4 Sell of products placed by BAM

BAM will also place low priced 2nd hand products on its website and earn
revenue from the margin.

9: Financial Plan
The following are the summarized points from BAM's financial plan.
 BAM will generate assertive revenues by the end of year one.
 BAM will start reporting sustained profits during the 9th month of the 1st
year.
 Sales and profits by year three will top 1.5x that of year one.
 BAM will require an initial investment in capital to finance the marketing
campaign and launch strategy.
 BAM will require additional investment to fund additional Web
development, sales and marketing efforts and general operating expenses.
BAM will provide a complete Consumer to consumer marketplace.  Investment
contacts have already been approached and their expressions of satisfaction and
encouragement are numerous.  We intend to continue our advances with more
unique and effective business solutions for the c2c market.  Based on the
attached financial projections, we believe that this venture represents a sound
business investment.
9.1 Important Assumptions
The financial projections are based on the following assumptions and facts for
the industry as outlined in our market analysis:
 As of 2008, internet users spend estimated Rs. 0.75 to 1 million annually.
(in Pakistan)
 There are over 1.8 million internet users.
 The founders have contributed significant capital.

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 The fee for posting product will 5% , 10% ,15% and 20%
 The fee for posting classifieds will equal 300 per classified.
 The sales margin for products sold will average 15% and vary based on
product.

9.2 Start-up Funding

In order to implement BAM Phase 1 marketing campaign and launch strategy,
we are seeking an initial seed investment of Rs.12,00,000.  An additional
investment of Rs.1 million will be required for operational expenses, continuing
marketing campaigns, additional website enhancements, maintenance and
support as necessary to establish and maintain BAM as the leading online c2c
market place.
As detailed in the Cash Balance chart for one year, BAM will be able to begin
and sustain its operations with the above mentioned investments.  We are
confident the opportunities in the market place are so compelling that with year
one cash flows; BAM will grow and take advantage of the growth in the c2c
market.

Start-up Funding
Start-up Expenses to Fund Rs. 303,600
Start-up Assets to Fund Rs. 855,000
Total Funding Required Rs. 11,586,00
Assets
Non-cash Assets from Start-up Rs. 300,000
Cash Requirements from Start-up Rs. 500,000
Additional Cash Raised Rs.0
Cash Balance on Starting Date Rs. 50,000
Total Assets Rs. 855,000

Liabilities and Capital

Liabilities
Current Borrowing Rs.200,000
Long-term Liabilities Rs.0
Accounts Payable (Outstanding Bills) Rs.0
Other Current Liabilities (interest-free) Rs.5,000
Total Liabilities Rs.205,000
Capital
Planned Investment
Owner Rs. 500,000
Additional Investment Requested Rs.450,000
Additional Investment Requirement Rs.0
Total Planned Investment Rs. 15,000,00
Loss at Start-up (Start-up Expenses) (Rs.57,685)

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10: Website
10.1 Address www.ebam.com
st
1 we decided bcom.co.nr as our domain. It was derived from our
course (b.com) and was similar to ecom (ecommerce) but another suggestion
made by our member was bam stands from Bilal- Basit, Ali, usman Mubarik.
And with addition of “e” in the start from Ecommerce it’s now final and
complete.

10.2 Host www.000webhost.com/

They are probably one of web hosting company that has proof for "99%
uptime guarantee"
10.3 Domain www.freedomain.co.nr
10.4 Payment PayPal, MasterCard, visa
We have registered with PayPal and will use its services for receiving and doing payments.

10.5 Security VeriSign

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