business plan of mashrum chip

New Product Plan (Mushroom Chips) ……………………………………………………………………………………….

The New Product Plan Regal Company’s (Mushroom Chips)

Made in Bangladesh

Term Paper On …………………………………………………………………………………..............1 Introduction to Marketing

New Product Plan (Mushroom Chips) ……………………………………………………………………………………….

The New product Plan Submitted To: Sharmin Akter Lecturer, School of Business United International University

Submitted By: Subject: Introduction to Marketing Section: D Group Members: (Orchid) Nancy Christina Sinha (leader) ID# 111072174 Md.saeeduzzaman ID# 111072131 Md. Mahbub Morshed Sobhany ID# 111072028 Nuria Hoque Bristy ID# 111063133 Addur Rahaman ID# 111072114

United International University (UIU) April 12, 2009

Student’s Declaration …………………………………………………………………………………..............2 Introduction to Marketing

New Product Plan (Mushroom Chips) ……………………………………………………………………………………….

We Nancy Christina Sinha, Md.saeeduzzaman,Md. Mahbub Morshed, Nuria Hoque Bristy, Addur Rahaman students of United International University are declaring that this report titled “The New Product plan” has been prepared only for the fulfillment of one of the curse requirements of the course Introduction to Marketing. It has not been prepared for any other purpose like awarding, reproduce or investigation for any other authorities. So, any one can take assistance only for academic purpose.

(On behalf of the group) Nancy Christina Sinha Id no. 111 072174 School of Business United International University

April 12, 2009 Sharmin Akter

Lecturer, School of Business …………………………………………………………………………………..............3 Introduction to Marketing

New Product Plan (Mushroom Chips) ………………………………………………………………………………………. United International University Subject: Submission of the Term Paper on the New Product Plan.

Dear Madam, We the students of BBA are submitting our term paper on “The New Product Plan on Regal Company (mushroom chips)”. It gives us pleasure to inform you that we have completed our term paper under your kind direct supervision. Now, we have placed our term paper before you for your kind approval. We hope that our term paper will please you.

Sincerely yours, __________________

_________________

Nancy Christina Sinha ID # 111 072174

Md. Mahbub Morshed Sobhany ID# 111072028

__________________

__________________

Md.saeeduzzaman ID# 111072131

Nuria Hoque Bristy ID# 111063133

______________ Addur Rahaman ID# 111072114

Acknowledgement

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New Product Plan (Mushroom Chips) ………………………………………………………………………………………. This study is the conclusion of the term paper undertaken by Introduction to Marketing, course instructor, Sharmin Akter, United International University, for the spring students to enhancement the experience and knowledge gather from a particular field. We are grateful to our course teacher Sharmin Akter, Lecturer of United International University, for her guidelines to this study. All the group members were worked equally to fulfill the term paper works and did all types of research activities for collecting the information related with our term paper.

Table of Contents …………………………………………………………………………………..............5 Introduction to Marketing

New Product Plan (Mushroom Chips) ………………………………………………………………………………………. CONTENTS Executive Summary Introduction Chapter 1.0: Current Market Analysis 1.1: Market analysis 1.2: price 1.3: sales 1.4: Gross Margin 1.5: Profit 1.6: Distribution 1.7: Major competitors Chapter 2.0: Threats and opportunities analysis Chapter 3.0: Objectives and Issues Chapter 4.0: Marketing strategy 4.1: Market segmentation 4.2.: Target Market 4. 3..Positioning 4..4: Differentiation 4.5: SWOT Analysis 4.6: Marketing Mix 4.6.1: product 4.6.2: price 4.6.3:promotion 4.6.4: place Chapter 5: Action Program

Page NO. 1 02 03 03 04 04 04 04 04 05 06 06 07 07 07 07 07 07 09 09 10 11 11 13

Chapter 6: Budget

14

Chapter 7: Controls:

15

References

16

EXCECUTIVE SMUMMARY Vision: “We want to be Asian Number One Chips Company.” …………………………………………………………………………………..............6 Introduction to Marketing

New Product Plan (Mushroom Chips) ……………………………………………………………………………………….

Mission: “We want to be number one chips company in Bangladesh and create strong relationship with our supplier and ensure our customers’ health security by providing more nutrition.” Brand Name: Regal Company Product Name: Mushroom chips We are dividing the total new product plan into 7 chapters.1st chapter, includes the market segmentation, market review and distribution, competitors’ background. We discussed about our sale will be done into 6 division town side areas. We want to produce 960000 of products in our first step of production. Profit will be earned within 2 years. Our current market analysis is like product demand, makert segmentation (age, class), and competitor’s position on market. 2nd chapter, we discussed about threats and opportunities that our product have like if the government changes politics then it will be easy to access the product to the market. To achieve our goal, we match the opportunities with our goal and minimizing our threats. 3rd we included our financial and marketing objectives like development and research activities, how to increase our customers satisfaction level, what percentage our production will increase etc. 4th we discussed about total marketing strategy .it contains customers driven market strategy like market segmentation, target market, positioning ,marketing expenditure level, marketing mix (product ,price,plac,promotional activities ) and also how each response to the threats and opportunities and critical issues spelled out earlier in the plan. 5th action program is included in this .when our product will be launched, who will be done, how much will cost every thing mention on this like our advertisement plan on April, may, June. 6th chapter, our overall budget program like per unit of cost, fixed cost, variable cost, total production units etc. 7th chapter, the controlling process, we mentioaned hear how t control our overall marketing strategy like we will hire a market auditory to give suggestion how to improve our plan and operational activities.

INTRODUCTION Origin of the Report …………………………………………………………………………………..............7 Introduction to Marketing

New Product Plan (Mushroom Chips) ………………………………………………………………………………………. As we are doing Introduction to marketing, our course instructor Sharmin Akter has instructed us to prepare a paper on the new product plan. Purpose •

To get a clear concept how to make the new product plan

•

To acquire knowledge how to make mission, vision, marketing mix etc.

Limitations 1. We did not collect the current information related with our product. 2.

We had to give lot of times to collect information about competitors, market situation because enough information not available.

RESEARCH METHODOLOGY  Secondary :

 Internet:

www.google.com

,

www.wekipidia

.com,

Source:

thedailystar.net

 Other: Collected information from marketing report, magazines, running newspaper.

Chapter 1:00 Current Market Analysis …………………………………………………………………………………..............8 Introduction to Marketing

New Product Plan (Mushroom Chips) ………………………………………………………………………………………. 1.1: The Market Analysis We know, the market means potential customers of a product or service. Bangladesh is a highly populated country. The birth rate is very high .As a result the children rate is also very high. We are not producing our product not only for children but also for teenagers, young generation. So our total target market is very large. Market demands of market will also increasing as much we can position in our customers mind.

Chips demand by age 500000 400000 300000 200000

Demand

100000 0

5 to12

12 to18

18 to 24

24 to others

(All this figure are estimated depending on class and age to have an idea about demand on chips on this variables) This is our target market. We want to target children as well as young people of middle and higher class of people. We are not eliminating lower class people but first we want to Create demand for our product then we will try to reduce our product price and serve to all class of people. 1.2: Price:

600000

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New Product Plan (Mushroom Chips) ………………………………………………………………………………………. Two price levels are set for launching our product one for family size and one for kidz size. 1.3: Sales: We want to produce 960000 of products in our first step of production. Depending on increasing demand rate, we will increase our production rate over a month. Every year, we will increase our 10% of production. We will observe the sales and satisfaction levels of our customers through our sales representatives. Our Product will sale only in Urban and town side areas of Bangladesh, that’s why we are not distributing and sales product in rural areas because our price level is bit high. After increasing our product demand and sales, we will try to reduce our cost of production. As a result, we reduce our product price and distributed in rural areas in Bangladesh. 1.4: Gross margin: We have a grate competition in our market.1st year; we want to create huge demand by good quality advertisement and promotional activities to create position in our customers mind. As a result, we expected low gross margin for 1st year, it will be just cover the fixed asset. 2nd year, we will try to sale more and more and reduce the cost of goods sold. It will increase our gross margin. 1.5: Profit: We expected earning profit within 2 years. Before that we will try to cover our fixes costs and make break event points of sales. 1.6: Distribution review: Factory Retailer •

Warehouse

Divisional warehouse

Salesman

Customer

Our factory situated at Tongi in Gazipur. After producing our products it will store in our own warehouse Mirpur.

•

From this warehouse products are distributed 6 divisions by our own transport and then storing these goods in divisional warehouse.

•

Then our trained salesman distributes our products in the market to the retailer.

•

And finally retailers sell it to the ultimate customer.

1.7: Major Competitors: …………………………………………………………………………………..............10 Introduction to Marketing

New Product Plan (Mushroom Chips) ……………………………………………………………………………………….

1. Product: Cheese Ball :: Product Code: CB :: Product Description: CHEESE BALL is an extruded product made from corn and rice and coated with rich cheese powder. It is superb in taste and something to be enjoyed all the time. Ingredients: Corn, Rice, Salt, Vegetable Oil, Cheese Powder & Seasoning.

2. Company Name: Meridian Foods Ltd. Business Type: Manufacturer, Trading Company Product/Services: Chips, Chocolate, Sauce Customers: All person Total Annual Sales Below US$1 Million Volume: Export Percentage: 1% - 10% Total Annual Purchase Below US$1 Million Volume:

3. :: Product: Mr. Twist :: Product Code: MT :: Product Description: Mr. TWIST is especially attractive to youngsters. This potato based snack has a certain amount of modified or native starch to give it a beautiful twisty shape and fine texture. Available with tomato paprika flavor. Ingredients: Potato Powder, Modified Potato starch, Native Potato starch, Refined Vegetable Oil and seasoning. 4. :: Product: Potato Crackers :: Product Code: PC :: Product Description: POTATO CRACKERS is a very popular snack prepared with combination of wheat, starch together with potato. It is a light, crispy snack and less oily. It has an average food value and is available with spicy tomato flavor. Ingredients: Potato Powder, Potato Starch, Wheat flour, Refined Vegetable Oil and Seasoning.

Chapter 2: Threats and opportunities analysis Opportunities and threats are external factors. For example, an opportunity could be a developing distribution channel such as the Internet, or changing consumer …………………………………………………………………………………..............11 Introduction to Marketing

New Product Plan (Mushroom Chips) ………………………………………………………………………………………. lifestyles that potentially increase demand for a company's products. A threat could be a new competitor in an important existing market or a technological change that makes existing products potentially obsolete.

Opportunity: It’s an available product but of the new version of taste and quality create a new change of the customer taste. For the technological changes and advances it’s easier to give any information and promotional activities to know the product popularity to the people. If the government changes politics then it will be easy to access the product to the market. Availability of the raw materials is increasing day by day which is help to produce more products.

Threats: If government is increase the taxes and the political issues are not favor then it will be the threats for the company. The product may not be accepted to the people then it will be the great threats for the company. The product competitor rate is very high that’s why sometimes we are facing many competing problem, which can be a threats of the company. Company establishment rules and regulation is strict that’s why sometimes to take any easy decisions are create complicated situations.

Chapter 3: Objectives and issues Marketing Objectives: 1. We want to be no.1 Chips Company in Bangladesh. 2. After one month, we are collecting our sales review and satisfaction level of our customers. 3. Diversification in our product line. 4. We want to create social value for position in customers mind. Financial objectives: 1. Marinating a significant research and development budget. 2. Double profit will be earned within 3 years. …………………………………………………………………………………..............12 Introduction to Marketing

New Product Plan (Mushroom Chips) ………………………………………………………………………………………. 3. Increasing production level each month by 1 % 4. Investing more in Cultivation Of mushrooms. 5. Establish 3 Big factory for producing large amount of product

Chapter 4: Marketing Strategy: 4.1 Market segmentation: Geographic: divisions and district town side areas such as Dhaka, chittagoan, Rajshahi, Sylhet, Barishal, Khulna .Dhaka – (gazipur district -town side) Demographic: Age-5-12, 12-18, 18-24, 24 to others and higher class, middle class of people. Product related: 1.regular customers 2. Irregular Customers

3.nagetive customers

4.2: Target market: 1. Children 3. People Middle class and higher class 2. Young people 4.urban areas people 4.3: Positioning: To children, young people, chips customers who are seeking for delicious taste with nutrition .Mushroom chips contains mushroom that gives you taste with good nutrition because it has the highest level of Protein-15.53%, Fat-20%, Saturated fat-1.42%, Carbohidrated-2.45%, Sugar-2.40%, Energy-100gm, Colastrol0%, Sodiam-.64% 4.4: Differentiation: Mushrooms are good sources nutrition and this is our main ingredients. 4.5: SWOT analysis is an important tool for auditing the overall strategic position of a business and its environment. SWOT is an abbreviation for Strengths, Weaknesses, Opportunities and Threats Strength: Technological skills Distribution channels Product quality Value delivery network

Weakness: New company Absence of importer skills Unreliable product Financial problem

…………………………………………………………………………………..............13 Introduction to Marketing

New Product Plan (Mushroom Chips) ………………………………………………………………………………………. Opportunity: Changing customer taste Technological advances Changes in government politics Availability of raw materials

Threats: Changes in government politics Acceptance the product Competitor rate high Strict rules and regulation

Strength: Without any touch of hand the product is made because of development of technological skills. There are another strength of the company is distribution channels. Our distribution channel is very strong; relation of the supplier and resellers is very strong. The product quality is more high comparative to the other competitors, because our main ingredients is Mushroom which is totally new flavor and taste and also work against for the cancer. Because of our good relationship with supplier, reseller and for the good transportation facility our sale will be definitely increases. Our value delivery network is in strong position. We are having good relationships with our suppliers for a longer period of time. Weakness: Although the company is new, it has not established a brand or images in the market place this is the weakness for the product popularity. Because of the new product and company importer skills are absence here that’s why we can’t includes any internal facilities. For the first time the mushroom is exit in the market that’s why people can’t properly reliable to the product quality. Financial problem is another weakness of the company like what will be the price Cost and investment. Quality of the Mushroom is not up to mark.

(Opportunities and threat are discussed earlier)

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New Product Plan (Mushroom Chips) ……………………………………………………………………………………….

Adjustment of opportunities and threat: The usefulness of SWOT analysis is not limited to profit-seeking organizations. SWOT analysis may be used in any decision-making situation when a desired objective has been defined. If the raw materials are available to the market then the cost of the raw materials will be reduced then we can produce more product in minimum price, and if the government politics are favor then the supply of the product and the transportation cost will be reduced. These products have new taste and a new ingredient which is changes the customer taste. We have to overcome the threats. If the product is not the accepted to the peoples, then we have to increase our promotional activities to attract the peoples and create more differentiations better then our competitors. 4.6: Marketing mix: Marketing mix consist of four basic things which is known as “four Ps”: product, price, place, promotion under the consideration of our product (Mushroom Chips) These four Ps are specified as 4.6.1: Product: The Mushroom chips, including all the features described in the product review section. The product is verified in two ways, first by the size 1) Kidz 2) Family and second by the taste of the product 1) Tomato flavor 2) Potato flavor 3) Hot & Spicy flavor.

Mushroom Chips (Burke) Recipe By : Cooking with David Burke Serving Size : 4 Preparation Time :0:00 Categories : Amount Measure Ingredient -- Preparation Method -------- ------------ -------------------------------1 pound large white mushrooms OR portobello mushrooms 2 cups clarified butter OR vegetable oil coarse salt OR kosher salt -- to taste

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New Product Plan (Mushroom Chips) ………………………………………………………………………………………. Quality that we are first assure in our product. It is highly reached by Protein15.53%, Fat-20%,Saturated fat-1.42%, Carbohidrated-2.45%, Sugar-2.40%, Energy100gm, Colastrol-0%, Sodiam-.64%, which is very much essential for specially kids and young age people. Each and every process of the production is done by automatic machine. Design is the factor that will often give a company its competitive edge. It is the totality of features that affect how a product looks and functions in term of customer requirements. Feature leads to the materials which are used in production for making the product. ‘ Regal industries used Mushroom powder, Mushroom starch, and Wheat flour, Refine vegetable oil, Seasoning and Potato powder for the potato flavor, Tomato powder for tomato flavor and Chili powder for the hot & spice flavor. The top management of the Regal Industries has decided to give a brand name to there new product as “Mushroom Chips”. Packaging which gives an extra attractiveness to any particular product for “Regal Mushroom Chips” three types of packaging will be done Red color for the tomato flavor, Yellow color for the potato flavor, and Green color for the hot & spicy flavor. The whole packaging process will be done without any kind of hand touch in an automatic machine.

4.6.2: Price: “The Regal mushroom chips” will be introduced at tk.14 wholesale and tk.15 estimated retail price per unite of medium size and tk.24 wholesale and tk.25 retail price per unite of family size product. We expect to lower the price of packets within few months. Because of the first time at market the company would like to give some discount to the retailers which will make them some profit. The company are also giving some credit terms facilities to there wholesaler and retailers.

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New Product Plan (Mushroom Chips) ………………………………………………………………………………………. 4.6.3: Promotion The management of Regal Industries has budgeted tk.1, 80,000.00 for there advertising and promotion activities for per month. As a new product in the market it needs huge amount of advertising and promotion activities to tell the consumer about the product and its features. For that reason management decide to go for more fancy advertise in Television, Radio, Billboards, and Web site and in News paper. The policy makers has decide to offer different types of popular cartoon and super hero characters stickers and tutus with per packet of Regal Mushroom chips for Childs and purchase intensive to the wholesaler and retail for sell promotion. By organizing Charity concert, Open concert, Sports tournament, Reality shows etc; Regal Industries would like to build a good relation whit people in near future. 4.6.4: Place: At the very beginning Regal Mushroom Chips will distribute to the town area of 6 divisions across the country with companies own transport system. By considering the future demand it has planned to distribute in the whole country area. For unexpected future demand it always kept sufficient amount of inventories in its own warehouse.

Marketing Organization Chief marketing officer holds overall responsibility of all the companies marketing activities. Company has also three top level manager for advertisement department , sales department and promotion department .And under sales manager company has six divisional sales manager .They are responsible for divisional sales increasing.

Marketing Organization …………………………………………………………………………………..............17 Introduction to Marketing

New Product Plan (Mushroom Chips) ……………………………………………………………………………………….

Ms.Nancy Christina Chief Marketing Officer

Ms.Bristi Rani Advertising Manager

Md.Abdur Rahaman Sales manager

Md.,Hasan Mahamud,Promo tion Manager

Md. Azad, Reasonal Sales manager. Dhaka Ms. Sayla Zaman , Reasonal Sales manager, Barisal. Md. Jahidul Islam, Reasonal Sales manager, Khulna Mr. Rafique Khan, Reasonal sales manager, Rajshahi. Ms. Sabrina Azam, Reasonal Sales manager, Sylet. Md. saley uddin , Reasonal Sales manager, Chittagong

Chapter 5: Action Program …………………………………………………………………………………..............18 Introduction to Marketing

New Product Plan (Mushroom Chips) ………………………………………………………………………………………. Our company “Regal Company” will be introduced in May 2009. Following are summaries of the action programs we will during the first three months to achieve our stated objective. April: We will initiate a Tk 300000 trade sales promotion campaigns to educate retailers and generate excitement for the product launch in May. We will exhibit electronic trade show, provide mini pack sample to the selected customer. Our promotion manager is responsible for this work May: We will start an integrated print, radio and media advertisement targeting consumers. This advertisement will show our products differentiation from other competitor. Advertisements also show our products feature to the ultimate customer. Our Advertisement manager is responsible for those works. June:

As the multimedia campaigns continue, we will add consumer’s sales

promotion techniques such as giving scratch card and lottery etc.

Our sales

manager is responsible for this type of sales increasing techniques.

Chapter 6: Budget In this section we make expected budget of sales and cost monthly and yearly. We count break even point unit sales. We also present our expected sales revenue and profit. Our product per unit cost is 13.5 Tk. And wholesale price is 14 Tk. And Maximum retail price is 15 Tk.. Expected Sales Budget Division Dhaka Chittagong Barisal Sylet Rajshai Khulna Total

Monthly Unit Cartoon 5,00,000 5,000 2,00,000 2,000 70,000 700 80,000 800 50,000 500 60,000 600 9,60,000 Expected Cost Budget

Type of Cost Variable

Monthly(TK) 1,10,40,000

Yearly Unit 60,00,000 24,00,000 8,40,000 9,60,000 6,00,000 7,20,000 1,15,20,000

Cartoon 60,000 24,000 8,400 9,600 6,000 7,200

Yearly(Tk) 13,24,80,000

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New Product Plan (Mushroom Chips) ………………………………………………………………………………………. Fixed

20,00,000

2,40,00,000

Total

1,30,40,000

15,64,80,000

Per Unit Cost Per unit Cost = (Fixed cost + Variable cost) Unit Production (2, 40, 00,000 + 13, 24, and 80,000) 1, 15, 20,000 = 13.5 Tk. Break-even Unit Sales (Yearly) Per Unit Sales

14 Tk.

Per Unit Variable Cost

11.5Tk

Per Unit Contribution

2.5Tk. Fixed expense

Now, B E S in Unit = Per Unit Contribution 2, 40, 00,000 = 2.5 =

96, 00,000 unit.

Expected Revenue (Yearly) Sales (1, 15, 20,000* 14)

16, 12, 80,000

Variable Cost

13, 24, 80,000

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New Product Plan (Mushroom Chips) ………………………………………………………………………………………. Revenue

2, 88, 00,000 Expected Profit (Yearly)

Revenue

2, 88, 00,000

(-) Fixed expense

2, 40, 00,000

Profit

48, 00,000

Chapter 7: Controls: The controlling process: In the control Process, we will compare our total result with the expected things that we are mentioned. If there is mistake s then take necessary steps to control the overall process. There will be two way of controlling. One is operational control and second one is strategic control. Operational control: If any changes occurred to our production process, then it will be done by operational control. Strategic control: If any changes occurred into strategic plan than it will be done by strategic control. Market Audit: We will hire a market audit or researcher to evaluate our marketing plan and give advices how to improve in operational control, strategic plan, others plans

References: 1.http://trade.coa.gov.tw/showProduct.do? isTemp=false&rid=2465&lang=e&showMenu=true 2. http://www.recipesource.com/fgv/vegetables/mushrooms/00/rec0053.html

3. http://www.malaysiabest.net/2006/03/06/snacks-mushroom-chips/ …………………………………………………………………………………..............21 Introduction to Marketing

New Product Plan (Mushroom Chips) ………………………………………………………………………………………. 4. http://ihor5.freeyellow.com/mushchip.html 5. http://banglapedia.search.com.bd/HT/M_0416.htm 6. http://www.mushroomlovers.com/Health.htm

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