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    Rs. Total Demand in Product Category

    Uploaded by

    Sichen Uprety
    The document analyzes sales targets, costs, and profitability for a product with 20% market share in a total category demand of Rs. 2,000,000. It simulates different pricing and promotion scenarios to reach a sales target of Rs. 400,000. The optimal scenario has a price decrease of Rs. 60 and promotion spending of Rs. 30,000, achieving sales of Rs. 1,250,000 with a profit of Rs. 118,333. Capital structure calculations show an equity of Rs. 812,833, loan of Rs. 541,888, ROI of 8.73%, and ROE of 14.56%.

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    Rs. Total Demand in Product Category

    Uploaded by

    Sichen Uprety
    27 views4 pages
    The document analyzes sales targets, costs, and profitability for a product with 20% market share in a total category demand of Rs. 2,000,000. It simulates different pricing and promotion scenarios to reach a sales target of Rs. 400,000. The optimal scenario has a price decrease of Rs. 60 and promotion spending of Rs. 30,000, achieving sales of Rs. 1,250,000 with a profit of Rs. 118,333. Capital structure calculations show an equity of Rs. 812,833, loan of Rs. 541,888, ROI of 8.73%, and ROE of 14.56%.

    Original Description:

    Calculation of business plan

    Original Title

    Book1(1)

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    The document analyzes sales targets, costs, and profitability for a product with 20% market share in a total category demand of Rs. 2,000,000. It simulates different pricing and promotion scenarios to reach a sales target of Rs. 400,000. The optimal scenario has a price decrease of Rs. 60 and promotion spending of Rs. 30,000, achieving sales of Rs. 1,250,000 with a profit of Rs. 118,333. Capital structure calculations show an equity of Rs. 812,833, loan of Rs. 541,888, ROI of 8.73%, and ROE of 14.56%.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    27 views4 pages

    Rs. Total Demand in Product Category

    Uploaded by

    Sichen Uprety
    The document analyzes sales targets, costs, and profitability for a product with 20% market share in a total category demand of Rs. 2,000,000. It simulates different pricing and promotion scenarios to reach a sales target of Rs. 400,000. The optimal scenario has a price decrease of Rs. 60 and promotion spending of Rs. 30,000, achieving sales of Rs. 1,250,000 with a profit of Rs. 118,333. Capital structure calculations show an equity of Rs. 812,833, loan of Rs. 541,888, ROI of 8.73%, and ROE of 14.56%.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    of 4

    Rs.

    Total demand in product category 2,000,000 (assumptions)

    market share 20%


    total sales target 400000
    market information
    Unit Effect on sales cost
    price 1 20,000
    promotion 1 30,000 50,000
    place 1 10,000 20,000
    Average price in market 200

    Simulation decision selling price sales effect


    price of market -60 140 1,200,000
    promotion 1 30,000
    place 2 20,000
    1,250,000

    Revenue 1,250,000
    COGS 1,041,667
    Marketing expenses 90,000
    total costs 1,131,667
    profit/loss 118,333

    Fixed assests 1,000,000


    working capital
    1. raw material inventroy 260,417
    2. credit sales 86,805.56
    3. cash for operation 7,500
    Total working capital 354,722.22
    Total capital 1,354,722.22

    capital structure:
    equity 60% 812,833.33
    loan 40% 541,888.89
    1,354,722.22

    Interest on loan 15% 81,283.33

    ROI 0.0873487799877
    ROE 0.1455812999795

    break even point (BEP) FC=mkt cost + interest


    FC/(S-VC) 0.82

    Interpretation:
    cost of marketing

    50,000
    40,000
    90,000

    sp 150
    cp 125 0.833333
    profit margin in rs 25

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