New Garments Business Plan Essay

though agriculture has always been the ane of the most anticipated sectors in bud agitates, discussions, lectures and books exactly in true sense garments industry in Bangladesh is the most infixed sector in terms of employment of comparatively less educated people.Employing almost 4.2 million people of whom 80% be women and thus impart to empowerment of rural women.Let alone employment even if we carry on foreign currency inflow this has been one of the most potential source. RMG c overs most 80% of the count foreign exchange earnings of Bangladesh. According to a survey it contributes or so 8 billion dollars which is around 13% of GDP. scratch line in 1970s earning from it has increased by 8 times which is around 16.5% per annum.SWOT analysisWeakness1. Limited financial investment,2. Insufficient infrastructural facility,3. slight educated work-force4. Negative impression on foreign buyers due to two political and unrest within the industry among the labor5. Lack of l evel-headed enforcement6. Lack of brand awareness7. PovertyThreats1. High level of largeness2. China, Pakistan and India.3. Increasing competition4. Capital investment availability,5. Political instability6. putrefaction7. Workplace unrestStrengths1. Labor intensive industry and labor live is cheaper in Bangladesh compared to most countries2. Plenty of labor available3. Quality products4. belligerent pricingOpportunities1. Becoming a major hub2. Tax reduction/govt. incentives3. intend Infrastructural development should improve supply chain a lot confederacy EleganceOur come with allow be a garment comp any(prenominal). Estimations are done based on square textile ltd and a venial company named triangle fashion crumble in Dhaka.Vision bid quality clothing for every class of people and become one of the leading names in garments sector in the country and afield as well.MissionCapture and satisfy the needs of customers through hail leadership and quality assurance and thus e xpand gradually.IntroductionOur company in the initial stage give go for secure shirts except assuming monthly call for of 4000 shirts. As we entrust barely scram ordered volume so the pretended demand is also our total production in units.We give take orders from other garments. As we give do the sewing only we wont be having any inventory constitute other than the raw materials.Reason behind macrocosm the designing and the cutting in these scenarios are normally done by the garment giving the order and we will complete the sewing and the collars. Buttons will be done afterwards elsewhere.For the electrical arrangements such as get the business line for industrial purpose and placing meters the live is assumed as 40000 and for wearing, stabilizers for machines sockets and other expenditure 40000 more is added with the initial cost.We will have 22 machines for which a 1000-1200 square feet space will be require. For hiring the place win with 1st months rent is assumed as 115000.Loan of 200,000(27.54%of initial investment) will be taken at a ordain of 15% which is stodgy to 30% of the total investment summate. (Basic bank)(Small scale enterprise The enterprise will be termed as small if in todays trade condition the replacement cost of plant, machinery and other components excluding land and building amounts to tk 15 million or less-Policy strategies for small and medium enterprises development in Bangladesh) ancestryThe raw materials should include, spurs, pastes used in collars and threads. Ordering volume will be our production so on that point will be no additive inventory costMachinesTaking the demand into account we will pass over with 22 machines of which 18 are single needle plain machines 2 over locks and two three needle machines.Ratios of plain machine to over locks and three needle is 102Single needle is for base sewing, three needle takes 1/3 time compared to single needle for obvious reasons but are very expensive, and over locks are sewing machines with blades that cuts the additional threads after sewing.Changes in demand and consequencesAccording to the possessor of the triangle fashion wear in the winter time the demand for shirts drop by 20-25%.duration of this shortage in demand is around 2 months.During this period there are obvious lay-offs so there is decrease in demand, in salaries and ultimately decrease in COGS and sales as well.Sales and COGSSales ontogenesis for our company is taken as 17%, based on the average of 5 years growth in sales of square textiles which is slopped to 20% and of triangle fashion wear which is closure to 15%.As for COGS, for our company the growth assumed is 10%.for square text. Average growth in cogs is less than 15.NWC is assumed as 15% of sale for our company for each of five years. For square text. It is close to 18%.Salvage valueFor the over locks and single needle SV is assumed at an average of 5500tk after 5 years for each of the machines and for the 3 needle machine it is 8000 tk eachDepreciation and taxAs for dispraise we deducted salvage value from total machine cost and deducted the amount by 10 which is the total lifetime for the machines. We used straight line disparagement for the other years.Corporate tax rate is assumed as 35% of the EBT amount.Calculating WACCMarket return of 10% is taken from the comport Bangladesh weather vane site on 12th April, US risk free rate is taken for the measurement which is close to 3% and beta of 1.26 is taken from the stock Bangladesh website as well for the textile industries.Calculating CAPEXCapital expenditure is compute by summing up all the fixed assets for the 1st year which is close to 7% of the total sales for the same year. For the rest of years the growth rate is assumed as same as the sales which is 15%.After that we deducted fixed asset amount of the previous year from the amount of current year.4P analysisProductAs we said earlier our only product will be shirts.PricingRat e for sewing shirts in the securities industry now is close to 90tk per shirt, we will start with 85tk to capture the market in the first place and then will focus on maintaining the quality.As we will only sew shirts so the calculated cost for each shirt will also be our production cost/unit.it is calculated as 49.5 by dividing COGS by demand. PromotionPromotionWe will do it by ourselves as the owner of the business so we wont be having any additional cost for advertising and there will be experienced supervisors too, to initiate promotion.Place/Location and legal transferWe will choose a place close to the companies we are expecting to get orders from.For the delivery of raw products to us and delivery of the sewed shirts to the companies ordering, companies themselves will be responsible.so again there will be no additional conveyancing cost for our company.