Business Plan

Topic: Manufacturing Consumer Goods

Course Title: Economics for Managers

Course Code: ECO-401

Submitted to:
Mr. Syed Mizanur Rahman
Associate Professor
Department of Business Administration

Prepared by:
Iftekharul Alam
ID: 202-14-3210
Daffodil International University
Program-MBA
Spring-2021

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Rio Food & Beverage
Limited

Business Plan

Iftekharul ALam
Id:202-14-3210
Date:03-03-2021

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To,

Mr. Syed Mizanur Rahman

Department of Business Administration

Daffodil International University

Date: 3rd March, 2021

Dear Sir,

It is an immense gratification for me to put forward this report on a Business Plan to you, which
you requested me to put in order as a confirmation of the appliance of acquaintance you taught
us in Economics for Managers.

On the process of preparing this report, helped me to expand a lot of knowledge about how
lounges operate in our country and what steps should be taken to set up a new business. This
project has also helped me to evaluate the knowledge I leaned in the class room with its` real
life application. It has farther enforced me confidence that the things I learned will be truly
required in realistic existence, rather than text or definitions to be memorized and then over
and done.

If for whichever cause, you are unable to deduce anything, please do not pause to contact me
for clarification. I hope you will forgive me for making any mistakes, lacking or inconveniences.

Sincerely Yours,

Iftekharul Alam

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 Table of Content

Contents

Introduction.................................................................................................................................................5
Executive summary.....................................................................................................................................5
Description of the business Idea..................................................................................................................5
Product Description.....................................................................................................................................7
Marketing Strategy of Rio..........................................................................................................................10
Competitive Analysis.................................................................................................................................12
Pricing Strategies.......................................................................................................................................14
Promotional Strategies..............................................................................................................................18
Critical Success factors..............................................................................................................................19
Challenge in the Industry:........................................................................................................................................19
Finance......................................................................................................................................................20
Human Resources......................................................................................................................................22
PESTEL Analysis.........................................................................................................................................24
Recommendations.....................................................................................................................................26
Reference..................................................................................................................................................27

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 Introduction
The Business plan is basically designed to established a new company an entrepreneur. In this
regard, it is required that a detailed business proposal plan is made to analyze the possibility in
upcoming future. Hence, company plan can be defined as a proper outline of vision undertaken
by businessman followed by narration of operations and strategies that are to be taken to
complete the venture.
Thus, Creation of a detailed business plan helps to offset the cost factors. It thus enables the
owners and managers of company to give a thought about industry broadly. It also helps to
discuss the business objectives to employees and lays path for future decision making.

Executive summary
It is basically an innovative business plan created with an intention to establish a new business
venture as an entrepreneur. Every business requires a detailed business proposal. The business
plan has been designed in order to offset the cost. It is thus an expression of the mission and
vision along with description with respect to operations and strategy to be followed.
It thus helps the top management to think about future prospects of business and make
decision for the same justification of business idea along with chosen aim and objective for
business. It is basically an account about background of study. The plan deal with business
concept and deals with detailed business picture in terms of innovation. Other than this
mission, vision, positioning and growth anticipation will also be studied. Next part deals with
feasibility aspect related to organization and financing. This will help to formulate a new
business model.
In the fourth section business model development will be done to capture essential in order to
get clarity on various aspects like core strategy, resource requirement and core competencies
of business. In the business development plan, there is a blueprint as to how the firm intends to
function. In the last section viability aspect of proposed plan will be analyzed. This will help to
find out whether to go ahead with the proposed business plan or not.

Description of the business Idea

. My proposed plan to established a consumer goods manufacturing company. First of all, I
want to start our business by only 6-7 items and manufacturing our foods by contract
manufacturing. Because in contract manufacturing our business risk is very low. We need not to
be long investment for factory or purchasing high price equipment. We are new in consumer
goods side, so I think we need to experience in consumer goods side by contract
manufacturing. For our experience first I plan to contract manufacturing at least two years. In

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business terms which is called as experience cost. My propose company name Rio food and
beverage ltd.
Rio Foods and beverage Company will be formed to meet the growing demand for diabetics &
Sugar free cream biscuit.

Rio Foods and beverage ltd is initially focusing on the development, production, and marketing
of diabetics & sugar free cream Biscuits and cake products, which is detailed in this document.
Other food product development opportunities will be addressed in future amendments to this
business plan that will provide additional profit with expanded market share.

Mission statement
“to provide consumers around the country with delicious, affordable, convenient and
complementary foods and beverages from wholesome breakfasts to healthy and fun daytime
snacks and beverages to evening treats.”
“We strive to offer our customers the lowest possible prices, the best available selection, and
the utmost convenience.”
Markets and product
Product- Biscuit, Cake and noodles
Target location- Overall the country
Types of operation- Business to Business
Target customer- Normal shop, Supermarket, retailer, tea stall and hotel.
Company objectives and Goals
Goal- We aspire to be the market leaders in providing quality products within 5 years from the
inception.
Expand to market share and diversify into more eco-friendly products.
Objectives- Is to create awareness and try to influence people to consume sugar free cream
biscuit & Diabetics Biscuits.
Expected Accomplishments—Year One

In order for Rio Food and beverage Company to attain its vision as described in our mission
statement, the following primary goals need to be achieved in year one of operations.

 Develop nine products and release to retail marketplace

 Establish marketing and consumer image processes
 Establish distribution process for promotions and product release

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  Establish two additional products into development pipeline
 Participate with industry-leading trade associations for relationship and brand
development opportunities.

Product Description

Introduction
Rio Food and beverage limited is introducing 3 biscuit items in three packing mood, two cake
item and one noodles item.

Description of Product
1. Creamo mini

Creamo mini main specialty has we use sugar free cream in this biscuit. This item has three
packing mood one is creamo mini, another is creamo standard and other is creamo family.
Biscuit size, test and material is same in three categories. In the basis of our target customer,
we packing this biscuit in three mood.
2. Suzi standard

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This item is our hot item. In the basis of market analysis, we decide to make this item. In this
biscuit we use one kind of special masala which is tasty as well as good for diabetic people. This
item also three packing mood one is suzi mini, another is suzi standard and other is suzi family.
Suzi mini is for one person for snack purpose, Suzi standard is 2/3 person and suzi family is for
family or corporate office.
3. Saltina mini

Saltina mini our profitable item. We target to highest sale saltina in every month to achieve our
overall target sales. Saltina also three packing mood one is Saltina mini, another is Saltina
standard and other is Saltina family.
4. Cake

By market analysis we see that in summer time cake is hot item for consumer company. The
cakes market is fragmented and is still growing owing to the product variants across packaging

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formats, flavors and sizes. So, we plan to manufacture two kind of cake one is vanilla cake and
another is chocolate cake. If this two-item success we also plan to production cake box which is
lucrative for his packing mood.
5. Noodles
We plan to manufacture single pack instant noodles Due to the increase in consumption from
nuclear and middle-class families, the single-pack instant noodles segment holds the dominant
share in the market studied. It is popular among families, especially children. In order to avoid
storage constraints, parents prefer to purchase single-pack instant noodles. An increase in the
demand for instant noodles, as a nutritious meal for school-going children, is driving the single-
pack instant noodles segment of the market studied. The growing preference for instant
noodles from residential students is increasing the sales of single-pack instant noodles.

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 Marketing Strategy of Rio
Introduction
Introducing a new product to the market can be a challenging task for a business. No matter
how much confidence you have in the in the value of the product or how unique it is, there are
still things to consider before unleashing it on the public. The marketing concept of building an
organization around the profitable satisfaction of customer needs has helped firm to achieve
success in high-growth, moderately competitive market. However, to be successful in market in
which economic growth has leveled and in which there exist many competitors who follow the
marketing concept, a well-developed marketing strategy is required. Such a strategy considers a
portfolio of product and takes into account the anticipated moves of competitor in the mark.

Market Research and Analysis

Our company wants to develop and introduce a new Product. So, we have gathered
information through in-depth interviews. We made a survey of the market to have a clear idea
about our market, our customer demand, needs and wants. This information helps us to know
about the current market and prospects of our new product.

Market Description

Bangladesh is a country of about 150 million people. The total market size of the consumer
goods industry is about 100 million and day by day it is increasing. We have a spread
nationwide market of different convenient product. People are nowadays very much concerned
about the market and product conditions. So, we have a growing prospect of customers of
“Rio”. Among the population we worked out few segments of customers who will prefer our
product most.

Market Segmentation and Targeting

Market Segments

We have observed and analyzed the market and based on the nature of the market we
segmented the market in the following sectors:

Geographic Segmentation:

 Sylhet
 Rajshahi
 Khulna & Barishal
 Chittagong
 Dhaka

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Demographics:

 Individuals
 Family
 Sportsman
 Corporate office

Psycho graphics:

 Higher class
 Higher mid class
 Middle class

Behavioral:

 Diabetic People
 Health conscious
 Sophisticated who take the new product from the market

Target market and projections:

Analyzing all the segments, we decided our target market according to our product category.
The target customers of “Rio” are diabetic people, health-conscious people, sportsmen and
tourists. The company decided to charge low price then our competitor, if we consider price
versus taste received then we can see that taste received is more in value. Therefore, charging
the mentioned prices are justified. The following graph gives a clear idea of our target market.

 Target Market:

 Health Conscious – 32%

 Diabetic people –        43%

 Tourist –                  3%

 General people – 22%

We separate our target market into four different segments based on their geographic,
demographic, psychographic and behavioral characteristics.

Health conscious: Health-conscious people basically the sports person is one of our largest
target markets. In this segment, we get a lot of potential customer. One third of our total

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population is young. This is a significant number that we have to concern about them and
provide product, which is fit for them. About 5 million people of this total number are health
conscious. They spend about Tk. 1000 in a month in average.

Diabetic people: Sick people are one of our major considerations. More than 10 million people
suffer from Diabetics that need sugar free cream biscuit.

Tourists: Every year a huge number of tourists visit Bangladesh. We want to provide them with
“Rio”.

General Customers: Besides the above segments, the general customers will acquire a
significant portion of our target market.

Market Needs:

“RIO” wants to satisfy its customers need. That’s why it is important to identify the market
needs. Our first consideration is to provide the best product to its customers. That’s why we
offer three different sizes of Packing Mood with different prices for its different segment of
customers.

Mini: The lowest price for the rural mid social class and individuals.

Standard: Sports person and Corporate office.

Family: For a small family.

Competitive Analysis
The consumer goods industry is very much competitive. Many consumer goods companies have
acquired a significant portion of the market. But the unique features of “RIO” will take it far
beyond the reach of the competitor. Because, only some company produce sugar free cream
biscuit and special masala biscuit for diabetic’s person. To evaluate our prospect of “RIO” in the
current market, we have analyzed the market situation in various ways. Following are some
demonstrations of the analysis:

SWOT Analysis
Strengths
 Brand building capabilities
 The depth of distribution
 Low and mid-Price range of the product
Weaknesses

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  Dependence on retailers and grocery store
 Lack of Technology up gradian
 Contract manufacturing
Opportunity
 Growing demand of sugar free cream & diet biscuits

Threats
 Fluctuations in the prices of raw materials, transportation cost & distribution
 Emerging local Bakery products.
Competitor Analysis
By identifying our competitors and evaluating their strategies to determine their strengths and
weaknesses relative to our own business, product, and service. The goal of the competitive
analysis is to gather the intelligence necessary to find a line of attack and develop our go-to-
market strategy.

A good competitive analysis helps identify the strengths and weaknesses of our company in
relation to the alternatives.

Competitive analysis is an exercise of comparing our business, product, and service to

companies and finding similarities and differences. The most critical part of kicking off a
competitive analysis is choosing the right competitors to analyze. Otherwise, we will spend tons
of time on competitive research with very limited insight to show for it. In other words, the
competitors we select determines how we will perceive our company and the final analysis.

But how can we develop a list that accurately reflects our real competitors? Here’s what we
need our organization to align on first:

1. Customer (WHO)

Who are our target customers (and companies)?

2.Problem (WHAT)

What core problem does our product solve for our target customers?

3.Product Category (HOW)

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How do we solve this problem? Are we solving this problem with a unique technology or
process?

In my analysis our main competitor:

Olympic Industry

Pran Group

Square Group

ACI Group

Distinct Competency

These companies can try to entrance our market by launching new product lines to compete us.
Yet, we have distinct competitive advantage. That is our product is still brand new. The other
companies will take sometimes to enter into the market. Till then we can have a monopoly
market condition. The other advantage that we have is lower price. We will sell products in
reasonably lower price than other competitors do.

Strategies against competitors

To compete with the major competitors, we can adopt the following measures:

Providing the best service to create high customer satisfaction

Reasonable and acceptable pricing

Promising and providing top quality product

Launching highly effective mass promotional activities

Continuous innovation and modification of the products

Creating and maintaining long term customer relationship

Creating “Brand Loyalty” among the target consumers

Market Plan

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 Pricing Strategies
We have decided to set a reasonable price for our product when we will develop it. We
considered many factors in setting the pricing policy. We will describe a five-step procedure:

Setting the pricing objectives

Our company has decided where it wants to position its market offering. We have chosen our
objective to maximize market share. We believe that a higher sales volume will lead to lower
unit costs and higher long-run profit. We have set the lower price because we assume that the
market is price sensitive. Our overall objective is to capture the maximum market share by
setting lower price.

Determining Demand

Each price will lead to different level of demand and therefore have a different impact on
company’s marketing objectives.

Estimating costs

We have estimated the cost and want to charge a price that covers the cost of production,
distribution and selling the product, including a fair return for its effort and risk.

Types of cost and level of production

There are two types of cost: a) fixed and b) variable. In our new product development project
fixed cost is 13tk per kg Production. Though we start contract manufacturing so we need to
invest machinery purchase, factory stablished, land purchase etc. we only provide raw material
and pay our contract manufacturing authority 13tk per kg manufacturing.

There are some variable costs like-cost of bottle, packaging and so on. These costs tend to be
constant per unit production. Here I gave a sample costing sheet:

Date:03.02.21

Batch
Cost Sheet of Creamo Mini Output 85.39 Ctn
INDEX NP 0.58%  

Packing Mode: NP Tk 0.97  

Wt/Pkt./ Wt/Pkt./ Wt/Pkt./
Pkt./Box GM GM GM Net
Loos Wt./Ctn./
Cream Biscuits Total Kg. Unit TP MRP
48 5
30 1.44 Carton 192 240.00

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Sl Amou Amount/ Amount/
. Particulars Unit Qty. Rate nt Ctn. Box
               

170.8 170.8
  Selling Price Ctn. 1.00 9   9 3.56

  VAT at tariff rate 5%   50.00   3.60 0.08

167.2
  Net Selling Price         9 3.49

              -

  Raw Materials           -

28.5 7
  Flour 32+ Gluten (Super Quality) Kg. 25.00 1 12.63   -

27.1 1,35
  Flour 24+ Gluten (Normal) Kg. 50.00 0 4.95    

63.1 2,17
  Sugar Kg. 34.50 6 9.06   -

112. 1,24
  Dalda soft (Shortaning) Kg. 11.00 76 0.38   -

96.2 9
  P.Oil (Normal) Kg. 10.00 0 62.00   -

315.0 3
  Skimmed Milk powder Kg. 1.00 0 15.00   -

  L. Glucose Kg. 1.00 61.00 61.00   -

102.0 6
  Flavours/Chemicals Kg. 6.27 7 40.00   -

7,465.
  Input Kg. 138.77   03   -

  Batch Output Kg. 122.96       -

  Process Loss %   11.39%       -

72.8
  RM Cost per Ctn. Kg. 1.200   60.71 5  

  Cost per kg. RM of Baked Biscuit Tk.         -

                   
43.55
  Total RM Cost per Ctn. Kg. 1.44 %   72.85 1.52

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              -

  Packing Mat.           -

410.0
  Foil 850   Kg. 0.058 0 23.62   -

  Carton     Pcs. 1.02 10.69 10.90   -

  Gum Tape 120   Pcs. 0.01 69.00 0.58   -

20.98
  PM Cost     %   35.09 0.73
64.53
  Total RM & PM Cost per Ctn.     %   107.95 2.25

              -

1 Variable Manufacturing Overhead     13.00 18.72   -

Variable Sales & Mkt.Overhead Sales 2% of
2 Comm. SP   2.0% 3.42   -
Variable Sales & Mkt. Overhead Dist. 1.5% of
3 Comm. SP   1.5% 2.56   -
Damage & Market 2% of
4 Return     SP   2% 3.42   -

5 Variable Distrubition Overhead Pcs. 1.00 3.75 5.63   -

20.17
  Total Variable Overhead     %   33.74 0.70
84.70
  Total Variable Cost     %   141.69 2.95

  Free     2       5.90 0.12

11.77
  Contribution Margin     %   19.69 0.41

              - -

1 Fixed Manufacturing Overhead Per Kg.   - -   -

2 Fixed Admin. Overhead Per Kg.   1.00 1.44   -

3 Fixed Sales & Mkt.Overhead Per Kg.   8.00 11.52   -

4 Fixed Distribution Overhead Per Kg.   1.00 1.44   -

Amort. of Defr.
Advert. & Prom.
5 Exp.     Per Kg.   1.00 1.44 12.96 0.27
9.47
  Total Fixed Cost     %   15.84 0.33
97.70
  Total Cost per Ctn.     %   163.44 3.40

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 2.30
  Operating Profit per Ctn.     %   3.85 0.08

  Financial Overhead Per Kg.   2.00 2.88   -

1.72
  Total Financial Overhead     %   2.88 0.06
0.58
  Net Profit Margin     %   0.97 0.02

In above sheet we see that our net profit margin per product 0.02 tk after charge all kind of
cost.

Selecting a pricing method

We have chosen the target costing method to set price for our product; pricing that starts with
an ideal selling price based on customer considerations, then target cost will ensure that the
price is met.

Promotional Strategies
To acquire a strong position in the market, we need to give special emphasis on effective
promotional activities. In order to get the maximum market, share we will have to use all four
tools of marketing promotion. Specially, advertising through mass media will support us a lot.

Advertising

We initially will give more emphasis on paper ads and TV commercials. Because, advertising
through these media is the most effective way to reach the customers and position our product
in their mind. We are anticipating that this will have a massive impact on the teenagers and
other enthusiasts. Few neon signs and bill boards of “RIO” also can be set up in some core
points of the city. We hope to reach 75% of our customers through effective advertising.

Personal Selling

Though personal selling skill is not that much effective for convenient products like “RIO”, we
will inspire and train the sales persons of the retail stores to convince people to buy our
product when they will come to buy any biscuit & cake item. The sales persons will inform the
consumers about sugar free cream biscuit and about the healthy aspects. We hope that will
play a significant role to increase our sales.

Promotional Tools

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We have also planned to apply some promotional tools. Initially for sometimes we will
distribute our product at 50% discount just make our new product familiar with the customers.
This will be the market-testing period for our product. Later, we may apply the strategy of
giving gifts, lucky coupons, tour tickets depending on the market and competitive situations.

Public Relations

We have future plans to hold seminars, commit social development, supporting social activities,
to arrange cultural functions and mobile game shows for publicity purpose.

Distribution Channel

In the initial stage, we will distribute the products with our sole distribution channel. When our
market will spread out, we will distribute our products through dealers. We will set our own
outlets in few core markets positions. When we will go for mass marketing, we will supply our
product nationwide through dealers. Our dealers will take the products to every district of the
country. “RIO” will be available in all retail stores of the country.

Services and warranties

As we are targeting to the top most customer satisfaction and building long-term customer
relationships, there is no alternative for us rather than providing top quality service. Giving the
customers timely and instant quality service is our primary concern. We even planned to open
few customer services centers where will response to customers’ interactions. We will collect
information, suggestions, ideas and opinions of the customers through these centers and will
innovate and modify our product accordingly. We also will change any defected product.

Critical Success factors

Overall biscuit industry is very challenging and tough to survive. Nabisco dominated this
industry for a long time but they are almost out of the picture now. This portrays how critical is
this industry nowadays. The food processing industry in Bangladesh faces acute problems of
low-capacity utilization, technological oldness and marketing shortfalls. Quality of the finished
product is generally very poor due to the high fluctuations in raw material quality and lack of
efficient technologies and trained manpower. Due to the high cost of energy and critical power
supply problems, uncertainty in the availability of adequate quantities of raw produce for
processing purposes, inadequate and expensive cold chain facilities and varying requirements
for processing conditions from one raw material to another, the industry is struggling.

Challenge in the Industry:

The industry currently faces 3 major obstacles:

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  High Competition: Consumer demands for high quality and low prices have been met by
various producers automating their operations. Despite this, more product lines are
expected to be launched by big players as consumer preferences are changing.
 Imported Ingredients & Duty: Local manufacturers procure most ingredients for
production locally. However, Bangladesh is not a major producer of wheat or palm oil,
which is required for biscuit manufacturing. As a result, most ingredients are imported
and exposed to foreign exchange risks which highly affect profitability. There is a 20%
supplementary duty on powdered milk, butter and other dairy oils, and spreads,
resulting in greater cost of goods sold, negatively impacting producers’ bottom line.
 Lack of R&D Facility: Recently the industry has seen a high positive growth in exports
due to its ability to ensure better quality products, however, is limited by a lack of R&D
facilities to develop new products/flavors and ensure quality to a greater degree. Unless
this challenge is addressed, it may turn out to be a major obstacle in scaling production
or meeting growing demands for exports.

Having these strong challenges in this industry, the brand specific critical success factors to
overcome the challenges for RIO food and beverage are as follows:
• Reaching the Target Group (Health conscious & diabetic patient) and make them loyal to RIO
food.
•Sustaining the consumers by creating an emotional attachment with this brand.
•Market activations to increase the brand awareness.
•Ensuring product visibility through dedicated preferential shelve presence.
•Product sampling (trial).
•Keeping the product quality good and at a consistent level.
•Ensuring continuous innovation to meet consumers’ expectancy.
•Giving proper profit to the retailers to keep them happy and hopeful.

Finance

Capital Requirement:    

Quantit Rate(BD Amount(BD

y Name Of equipment T) T)

  Raw material   6,000,000

  Packing Material   3,000,000

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 Furniture (Chair &
12 Table)   100,000

5 Laptop   300,000

  Other stationary   40,000

Startup expense &
  Legal   150,000

  Total   9,590,000

Funding

Start up
Capital

Three
Reserve Capital Types of Operating
Require Capital

d Capital

We need three types of capital, in above I give startup capital budget. We also need to
operating capital and reserve budget. I plan to funding capital from three sources:
 30% from our group reserve
 50% from Bank
 20% from owners

Sales Forecasting
The following Table and graph show our expected sales for the coming five years:

Expected Creamo Suzi Saltina Total

sales per year
300000 400000 1000000
First year 3000000 0 0 0

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 400000 450000 1200000
Second year 3500000 0 0 0
450000 500000 1350000
Third year 4000000 0 0 0
500000 550000 1500000
Fourth year 4500000 0 0 0
600000 700000 1850000
Fifth year 5500000 0 0 0

Profit and Loss Projection

Particular
s Year 1 Year 2 year 3 Year 4 Year 5

Total Sales 10,000,000 12,000,000 13,500,000 15,000,000 18,500,000

Total cost 7,000,000 8,000,000 8,500,000 9,300,000 12,000,000

Total
Profit 3,000,000 4,000,000 5,000,000 5,700,000 6,500,000

Tax 35% 1,050,000 1,400,000 1,750,000 1,995,000 2,275,000

Net profit 1,950,000 2,600,000 3,250,000 3,705,000 4,225,000

Breakeven Analysis:

Average per unit revenue 2.5

Average per unit profit 0.15

Average variable cost per unit 1.06

Average fixed cost per month 29000

Fixed cost 4581665

Gross profit per unit 1.33

Breakeven Unit 31,81,711.8

Breakeven Sales 79,54,279.5

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 Human Resources
Organization structure:

Personnel planning

Total number of employees

 CEO – 1 person
 Marketing – 5 persons
 Finance – 3 persons
 Accounting – 3 persons
 Manufacturing – 4 persons
 Human resources – 3 persons

Recruitment process

 Recruitment duties will be handling by the HR department who will keep track on any
available vacancies, promotions, and any other needs.
 The recruitment process will be different at every level of Management.
 The Manager will be chosen by the CEO with help from the HR department.
 The various mediums that will be used for recruiting managers will be referrals,
Newspaper advertisement, Online job search engines and recruitment consultancies
sending in candidates that fit the criteria of selection.
 At later stages the manager post can be filed internally through promotion of the junior
employees.

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  The employee will be selected through interviews conducted by the HR executive who
will conduct the initial interview and filter out the suitable candidates who will later be
interviewed by the department manager and the HR manager before the final selection.

Training required

 The employees will be provided all the required training to maintain our quality levels
and aid customer satisfaction.
 Every employee from a particular department will be trained according to the needs and
demands of his job description.
 The employees that make the biscuits will be trained to use the machine without wear
and tear as well as how to maintain the machine.
 The sales/marketing team and the client service team will be given additional training in
soft skill as they are the first point of contract with our client.
 The supervisor will be trained to use the machine, clear any queries as well as train any
employee as and when need arises.

PESTEL Analysis
PESTEL analysis is used to understand the uncontrollable factors. There are so many things to
consider when operating or planning to operate a business. The work is never easy to
understand without proper analysis. PESTEL is such a tool to understand the external
environmental factors. These are called the macro environmental factors. To understand these
factors PESTEL analysis is used.

PESTEL stands for:

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Political Environment:
Political environment is about how the government responses toward it. Government actions
toward some items are known as political action. Sometimes government controls some factors
when sometimes they make the law a bit free. Now these things depend on the government
and other responses from them. It includes political stability or instability in the foreign
markets, government’s relation with other governments, trade restrictions, labor law, and
environmental law. Organizations think on these factors how they should behave in the present
situation and thinks for the future for better or worst opportunity. Now, the biscuit industry
business will be initially operated in the country. So, there is not much chance for going outside
or overseas market in the very first phase. So, it is important to analyze the Bangladesh
government’s factors as they are up stated.
Economic Environment:
Economic environment has a significant impact on any business. An organization operates its
businesses remaining in the economic environment. Economic environment considers
economic rate, growth rate, tax rate, interest rate all these factors. Organizations need to be
careful while analyzing the economic factors. Now, economic environment can be classified in
two parts. One is macro environment, other is micro environment. Macro environment includes
interest rate, tax rate and growth rate. Keeping these things under control, government
controls the economic environment. The micro environment is about the people and their
income. This is very important to understand for the B2C businesses. For biscuit industry we
need to understand the same factors and thus should go ahead.

Social Factors:

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Social Factors directly influence purchase behavior of consumers. It is very important to
understand the factors to know about consumer behavior. The factors are known as socio-
cultural factors. Socio Cultural factors include, age distribution, population growth, health
consciousness etc. Now for every market, these products will affect the purchase behavior and
thus affect the business profit for the organization. In terms of biscuit industry, it is important
to understand the factors and thus bring our products for the right target group of consumers.

Technological factors:

Technological factors are the most diversified and strong points to look at properly. Technology
has straight impacted on any business. Now a day any single day a business can lag behind from
the others for technology. So, technology is very important. Now these factors could be new
way to production. Any new production mode can turn to a better opportunity for business.
Secondly, new way of purchasing products can affect the business, thirdly new way of
communication can make a difference in the business. When the organization is going for
biscuit industry, we need to understand and thus take action for better opportunity.

Environmental Factors:
Environmental factors are a very vital issue in the last few years. To be more specific, since last
20 years these factors has become a buzz for the world. Especially for the established, big
brands are more prone to these sorts of things. They get more focus when they do something
wrong which is harmful for the environment. Scarcity of raw materials, Pollution these are the
core factors behind the environmental factors. Sometimes, government sets some targets
which are need to be achieved by the organization before they go for production.
Bangladesh government has certain rules and regulations to work on. So, when we going for
this business, we have to have the preparation as well.
Legal Environment:
Legal environment considers some of the things which are very important to understand legal
opportunities. Every company needs to know what is legal and what is illegal. If an organization
can understand such factors they can move forward. Now in terms of overseas business it
becomes tough and tricky as the sets are different from each other in different countries. Legal
factors include, consumer right, packaging mode, advertising mode etc. For biscuit industry
business, we need to fulfill these standards thus we can move forward to production.

Recommendations

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  FMCG (Biscuit) market is a very competitive one. Therefore, is important always
to be updates with market studies.
 Customers put enough importance on price. As it is a mass market segmented
product, price would be very a key player in segmentation.
 Taste is very important because people of Bangladesh are fond of good taste. A
good taste and indulgence can take a product to a very high position. So,
focusing on taste is highly recommended
 Next important thing is quantity. It is a mass market product. This product would
fight with other big players in the market. So, it is very important to have a good
quantity with relevant price.
 Products should be available all over the country. Many companies can produce
good product but cannot make it reach to every corner of the country.
 New product development is a very key chance to get a good market share. We
found it is very important while we had our interview with the selling group.
They said a new good innovation may have a good market for the next few years.
So, research and development team along with brand developing team need to
work on a continuous manner.

Reference

Books:
1. Management by R.W. Griffin, A.I.T.B.S. publishers and distributor, New Delhi, (Latest edition.)
2. Jaffe, Jeffrey, and Ross Randolph Wester field. Corporate Finance. Tata McGraw-Hill Education, 2004 (10th
Edition).

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 3. MANAGEMENT ACCOUNTING: Information for Decision-Making and Strategy Execution by Anthony A.
Atkinson, Robert S. Kaplan, Ella Mae Matsumura, S. Mark Young, 6/E, Pearson
Websites:

1. www.Entreprenure.com
2. http://dspace.daffodilvarsity.edu.bd:8080/bitstream/handle/123456789/3469/P13568
%20%2817%25%29.pdf?sequence=1&isAllowed=y
3. https://www.youtube.com/watch?v=uEvE5uIJctY
4. https://www.youtube.com/watch?v=zenLxIbkD3g
5. https://www.youtube.com/watch?v=sraoxDAp2Jo

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