Fuel Zone Energy Drinks

All the praises are for Almighty Allah whose uniqueness, oneness and wholeness are absolute. Who gave me enough courage, knowledge and ability to accomplish this project.

All respects are for His Holy Prophet Hazrat Muhammad Who enabled me to recognize oneness of my Creator? My Parents whose rising gave me character and a compassionate heart. So I pay my gratitude to Sir Vishnu Parmaar whose cooperation on every step of this subject is highly appreciable. Without his cooperation it was not possible to complete this task.

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Fuel Zone Energy Drinks

Office:
Latifabad unit # 5, Near Haseen Luxury Apartments, Hyderabad

Phone:
(022) 3811345 (022) 3811346

Email:
fuelzonebeverages@gmail.com

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Table of Contents
INTRODUCTION DESCRIPTION OF BUSINESS
FINANCING

EXECUTIVE SUMMARY
MISSION SOLOGON VISION OBJECTIVES KEYS TO SUCCESS COMPANY HIGHLIGHTS

INDUSTRY ANALYSIS
TARGET MARKET COMPETITION

DESCRIPTION OF VENTURE
PRODUCT SIZE OF OPERATION OFFICE EQUIPMENT BACKGROUND OF THE ENTREPRENEUR

PRODUCTION PLAN
Ingredients STAGES OF PRODUCTION PROCESS

OPERATIONAL PLAN MARKETING PLAN

PRODUCT PLACE Main Suppliers Marketing Distribution Channel PRICE Discounts, Allowances Offered PROMOTION Communication Channels

ORGANIZATIONAL PLAN
HIERARCHAL STRUCTURE

FINANCIAL PLAN
BREAK EVEN ANALYSIS

APPENDIX
MARKET RESEARCH Page 3

Fuel Zone Energy Drinks

Introduction:
The Fuel zone Beverages is a new firm going to start its operation in Hyderabad. It will start with an energy drink product with the name Fuel Zone. Fuel zone will be a partnership firm. The names of partners are given below. The firm is going to start its operations in a limited geographical level. The companys growth policy is to fulfill the customers need with quality product to grow.

Co-owners:
Faraz Ahmed Dar Muhammad Ibrahim Khan Naeem Malik Shahzaib Qaimkhani Waqas Mehmood Sheikh Waheed Zafar Khan Faizan Abro

Description of Business:
This business provides unique energy drink with mix fruits flavor without any harmful chemical. We provide healthy mix fruit energy drink with high quality and affordable price.

Financing:
Initial financing is PKR 10,00,000. This finance will cover office exp, marketing exp, plant and office rent. This report is confidential and is the property of co-owners listed above. It is intended for use only by the persons to whom it is transmitted, and any reproduction or divulgence of any of its consent is prohibited.

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Executive Summary
Mission: Our mission is to serve people by providing quality energy drink Sologon: FEEL THE POWER Vision: Our vision is to capture Hyderabad market by providing quality energy drink at low price in order to keep people healthy and fit. Objectives: o Maintain positive, strong growth each year not withstanding seasonal sales patterns. o Achieve a comprehensive output in market penetration. o Decrease customer dissatisfaction simultaneously. o A double to triple digit growth for the first five years o Increase the profit margin by adequate percentage each quarter through efficiency and economy of scale. o Maintain a significant research and development and advertisement budget to enhance future product developments. Keys to Success: The keys to success are designing and producing such type of products that meet market demand. In addition, our Company must ensure total customer satisfaction. If these keys to success are achieved, it will become a profitable, sustainable company specifically which will produce long lasting results as well. Company Highlights: The firm is going to start the operation to fulfill the need of the market segment that still has not been fulfilling properly. The market segment which is known as the energy drink is our focus. The people today have too much busy life. Their tight work routine absorbs all the energy from their body and soul. In this situation they need something that fulfill their energy need and make them fresh instantly. There are some products already exist in the market to take advantage of that segment of market. But the fact is that the competition is not so stiff in this segment. Another fact is that the products which already exist in the market have a high rate.

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The fundamentals of our business will be to fulfill the need of the people to remain energetic with our world class product at an affordable price. We take our customer as our first priority while taking any decision.

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Our target market of our mix fruit Energy drinks are mainly targeted towards those who need some sort of energy boost. Now everyone is facing the super-charged, overworked lifestyle, but young people are especially vulnerable to persistent exhaustion and insufficient energy. We will specially make our marketing efforts around Teenagers, Adults, and also Late 50s. The owners are the firm is the partners in the firm who dont have any intention to go in the public. The names and share of the partners are mention in the operational plan of the. The capital can be raise from the banks as well if necessary at any time. The industry has a very bright future as everyone expecting from the trends prevailing in the market. The energy drinks demand is rising as compared to the other drinks available in the market. The people are coming more and more towards the energy drinks not only to get their selves fresh but also regain the energy of the body which they loss during the everyday chores of work. As the share of industry is rising as the time passes on so to launch a business in such an environment where on one side the industry share of total market is increasing and on other side not much competitors are available in that segment looks like a very vise decision. The one weakness which we have is that we are new entrants in the industry as well as well we do not have the as much financial resources as the other competitors have. But the positive point is that we can still successfully compete with competitors due to our strategy. The one weakness that we have few financial resources is overcome by our strategy to start with a small geographical region Hyderabad. The advantage which we have over the competitors is that all the partners belong to the same geographical region so they are well familiar with the target population of the area. No matter that financial resources are few but the extensive marketing strategy can be launched because of the small geographical area. The close knitted connections of the partners in area and quality product at affordable price can win a leaders place in that area for our product. To fulfill this need and want of people we are launching our product with the name Fuel Zone in the market. As we want to see the response of the public towards our product before launch it on a vast level, so we are launching it in the regional area of Hyderabad in initial stages.

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Industry analysis:
The industry analysis for the drink concluded with following key points for the drink.
i) Fuel Zone has cultural effects in it also. It will be produced domestically and will

have competitive edge against the other imported drinks like low cost etc. Moreover the company can take the advantage of Be Pakistani & Buy Pakistani also. Fuel Zone can be customized according to the varying needs of the culture which may take place from time to time. ii) Technological changes are kept in mind in developing the idea of this particular product. Initially existing technology will be used in production and later on if there is change in the technology then new technology will be used in for long run after proper pre-testing. iii) At present there are no so much legal concerns about this business. And being a food item there is no as such restriction imposed by the Govt. because all ingredients used in making this drink are HALAAL
iv) There are many other drinks available in the market. But our focus is on the

health of the consumers. More people will replace their carbonated soft drink by something 'healthier' noncarbonated drink.
v) Company is forming its own market with the unique concept of providing energy drink with fruit flavor and original vitamins without the effect of any harmful chemical.

vi) There is increase in the sales of drinks in the market over the past three years. The sales of the energy drinks have doubled in two years. So the growth rate of the industry is good. vii) No new firm has entered in the business since last three years or so.
viii)

The sales of our competitors are steady from the past three years.

ix) Our customers belong to the different social classes i.e. middle class, upper

class, and so on. x) No new product introduced by the competitors since last three years. Distribution channel not much efficient.

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Target Market: Teenagers Adults Gamers Sports persons Also Late 50s

Target Market of our mix fruit Energy drinks are mainly targeted towards those who need some sort of energy boost. Now everyone is susceptible to the fatigue of the super-charged, over-worked lifestyle, but young people are especially vulnerable to persistent exhaustion and insufficient energy. Competition: Company is forming its own market with the unique concept of providing energy drink with fruit flavor and original vitamins without the effect of any harmful chemical. There are several other competitors who are providing energy drinks but we are specially focusing on healthy energy drink with original fruit contents with low caffeine margin. Energy Drink Fuel Zone Red Bull Monster Throttle Price Rs. 30 Rs. 45 Rs. 40 Rs. 50

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Description of Venture:
This section will provide detail our product, size of our operation, office equipment, and background of the entrepreneur. Product: Our product is fresh energy drink for those people who need some sort of energy boost. But young people are especially vulnerable to persistent exhaustion and insufficient energy. This energy drink will keep them fresh and will give energy to their body.

This energy drink will have unique freshness, high energetic calories and low price as compare to the existing energetic drinks available in market.

Logo:

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Size of operation: We are conducting our operations in Hyderabad city. We are lunching our energy drinks in Hyderabad city. This will be available in all beverages store, super markets and in shops. Office equipment: We have purchased well office equipment e.g. chairs, tables drink stands and other necessary equipment tools. Background of the entrepreneur: In the past we have been serving the people by offering different products Many of our products are already in market which are very successful e.g. soft drink, herbal oil, herbal shampoo many others. Now we think that we should provide an energy drink to people who keep them healthy and retain them fit and fresh.

Production Plan:
Ingredients Nutrition Value per 250ml Energy 211k (46.6kcal) j Protein 0,5 g Carbohydrates 10,5 g Fat 0 g Fruit pulps 30 g/l Caffeine 70 g/l Vitamin B 3 7,2 mg (min.40% RDA) Vitamin B 5 Vitamin B 6 Vitamin B12 2 0,8 0,4 mg (min.33% RDA) mg (min.40% RDA) mg (min.40% RDA)

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METHOD USED TO ESTABLISH THE DEGREE OF PURITY: The samples of the product have been analyzed according to the United Nations ST/NAR/7 Manual, using the method of Gas Chromatography Mass GCM. STAGES OF PRODUCTION PROCESS: 1. Reception Selected different fruits are first received at the Production Plant.

2. Crushing Then the fruits are crushed after removing solid impurities through Sieving. 3. Maceration During this process, the wet crushed fruits are left in the hydro alcoholic solution to separate into hydro soluble constituents by soaking until the fruits have taught the proper amount of tannins. 4. Alkalinisation Next, a solution of caustic soda or sodium hydroxide (NaOH) is added to the obtained extract in order to precipitate alkaloids. 5. Filtration At this stage, the alkalized extract is passed through a filter in order to remove any suspended solid particles. 6. Acidification After that, the former alkaline extract is acidified. Finally, the obtained ERG - A20 Extract is bottled and stored.

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Operational plan:
Operational plan of the product includes inventory, shipping, storage, inventory control procedures, and customer services. i) Just in time inventory system will be used in case of our product. It will reduce the storing cost also which will give us competitive edge against our customers. There will be no of suppliers of raw material to avoid any kind of problem in future.
ii) All manufacturing operations will take place in own factory. For this purpose

machinery needed has already been installed. iii) Outward suppliers will pay the shipping charges for the finished goods. In case of bulk purchase company will pay 30% charges. Purchase of 50,000 units in a month is the limit for the purpose. iv) Experienced workers will be hired from other industries as part time workers at a cost of Rs. 300 per day which will train our employees. v) Finished products of the drink will be stored in company rented building which has the capacity to store 100,000 units in it. Rent of the building is Rs.10,000 per month. vi) We will maintain the (including factory). finished goods inventory of 30,000 units at any time

vii) A survey will be conducted after every six months periods including finding out the market trends and consumer demands about the product. Later on product can be changed according to the needs.

Marketing plan:
Product: Fuel Zone energy drink water contains Carbonated water, high fructose syrup and/or sugar, Citric Acid, orange and apple juice from concentrate, natural flavors, Sodium Benzoate, Sodium Polyphosphates, Caffeine, Erythrism Acid, Maurine, Calcium Imodium Etta (to product flavor), Potassium Benzoate, Brominates Vegetable oil. Nutrition Facts Serving size: 1 can (8.4oz); saturated fat 0g; total crab. 32g; protein 0g; vitamin B12 10%; calories 120; cholesterol 0mg; dietary fiber 0g; riboflavin 20%; Fruit pulps 30% total fat 0g; sodium 75mg; sugars 30g; vitamin B6

10%;

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Company Name Brand Name Packaging Capacity/can Tray Disposable Pallet Pallet weight Pallet dimension Transportation Payment Packaging: Designing and Packaging many energy drink companies are more exclusive in their marketing efforts because they gear their products and advertising to a very specialized group. These groups include gamers, extreme sports enthusiasts. You can see the effects of this emphasis on such a target market because it is seen in the advertising campaigns of energy drinks. Place Fuel Zone focuses on the big and high growth market shared cities of Pakistan like Karachi, Lahore, Islamabad and Multan. Fuel Zone is also focusing on small cities so that their product will be available even in the small shop of rural area. Main Suppliers Different suppliers in beverage sector in Hyderabad. Marketing Distribution Channel Fuel Zone used indirect marketing distribution channel in which only Retailers are involved. Retailers buy the product and sell that product directly to the final consumer for their personal and non business. Some of major store retailers are:
Super markets Departmental store Food and beverages store Convenience store

FUEL ZONE BEVERAGES Fuel Zone Aluminum slim cans 250 ml 24 x 250ml 160 trays 1150kg 100x120x?150cm Can be organized if needed. Bank transfer or cash in hand.

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Price: Pricing wise, we follow our motto "Classy but not expensive". As a result, we offer a high quality and fashionable product at a lower price. It allows us to position ourselves as one of the best quality/price balanced brands. This provides our partners an opportunity to sell a high quality product, while increasing their margins and offering higher profits to their re-sellers. Purchase price of retailer of 1 can is Rs.30 Discounts, Allowances Offered In the competition with other energy and fruit drinks Fuel Zone tries to gain market share with giving Fuel Zone with reduce prices in special events such as Ramadan offer, Basant, and other Events. Promotion: We will promote our product by using different communication channel. Communication Channels T.V campaigns (through Cable) Bill boards Local Newspapers Advertising Campaigns

Organizational Plan:
The Fuel Zone company will be a partnership firm. The partnership will lie between the founders of the company. Partnership will be according to their share of capital invested in the firm. Profit will be distributed between them as per their percentage share in the firm. The every decision will be taken with the consensus and majority of votes will be required to take the decision. On every important document the signature of the at least 3 members should be there. This will also imply on the financial side of the firm. Partners and their contribution to capital is as follow Name of Partners Faraz Ahmed Dar Waqas Mehmood Shaikh Ibrahim Khan Waheed Zafar Khan Shahzaib Qaimkhani Naeem Malik Contribution 19% 15% 16% 19% 18% 13%
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Hierarchal Structure: The hierarchal structure of the Fuel Zone company is as follow: Board of Directors---------------------------------------------- Partners of Firm Chief Executive Officer---------------------------------------- Faraz Ahmed Dar Chief Financial Officer----------------------------------------- Waqas Mehmood Shaikh Marketing Manager--------------------------------------------- Naeem Malik HR Manager------------------------------------------------------ Waheed Zafar Khan Production Manager-------------------------------------------- M. Ibrahim Khan Operational Manager------------------------------------------Faizan Abro

The Organizational Chart:

Board of

Directors

CEO
Human Resource Manager

Finance
Manager
Finance Finance

Marketing
Manager

Marketin g Officer Officer Officer

Marketin g Officer

HR Officer

HR Officer Officer Page 16

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Financial Plan:
Projected financial statement of company listed below: Pro Forma Income Statement (PKR 000s) Sales Less: cost of sale Gross Profit Operating Expenses Salaries Rent Sales & Marketing Exp Utilities Office Exp Deprecation Tax Total operating Exp Net Profit 2009 6600 (2200) 4400 1630 900 400 200 200 70 400 3800 600 2010 9000 3000 6000 1950 900 700 350 330 70 550 4850 1150 2011 12000 4000 8000 2500 900 1100 600 550 70 700 6420 1580

Pro Forma Balance Sheet First year (PKR 000s) Assets Current Assets Cash 650 Account Receivable 120 Inventory 300 Total current assets Fixed Assets Office equipment 400 Plant 300 Less Deprecation (70) Total assets Liabilities & owner equity Current liabilities Account Payable 100 Total Liabilities Owner equity Equity 1000 Retain earnings 600 Total owner equity Total Liabilities & owner equity

1070

630 1700

100

1600 1700

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Pro Forma Cash Flow first year (PKR 000s) Net income Add: deprecation Increase in inventory increase in debtors Increase in creditors Net Cash flow from operating activities Payment to fixed assets Balance Net cash flow 600 70 (300) (120) 100 350 (700) (350) 1000 650

Break even Analysis:

We are determining the break even point graphically.

The horizontal axis showing the no of unit sold and the vertical axis showing for sales revenue and costs. The sales line starts at the origin ends at the point satisfying expected sales. The fixed cost line runs parallel to the horizontal axis meets the vertical axis at a point which represents a total fixed cost.

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The total cost line starts where the fixed cost line meets the vertical axis ends at the point which represents anticipated sales on the horizontal axis and total cost of the anticipated sales at the vertical axis. Variable Cost per unit: Fixed Cost: Expected Unit Sales: Break even Volume: 10 3800000 190000 fixed cost / price variable cost 3800000 / 30 10 = 190000 Pro Forma Sources and applications of fund (PKR 000s) Sources of fund Personal fund 1000 Net income 600 Add: Deprecation 70 1670 Application of fund Plant & Office Equipment 700 Inventory 300 Total fund expanded 1000 Net increase in working capital 670 1670

Appendix:
The contract of lease of land and building. The lease contract of the machinery. The partnership contract between the partners of the firm. The agreement with suppliers. Rental contract with the logistic facility provider.

Market Research:
Among college energy drink users, consuming energy drinks is particularly popular for insufficient sleep, when one needs more energy in general, to drink with alcohol while partying, and when studying for an exam or completing a major course project. Drinking three or more for a given situation occurs more frequently among those who consume energy drinks for three or more of the six situations that were assessed. Side effects of consuming energy drinks and headaches occur in many energy drink users.

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