Part# 1

Business Plan of Inter fashion Boutique

Page 1

1. Executive Summary
This report focuses on the different compensation practices designed by our own established
company called Inter fashion Boutique for different levels of employees. In this report we
have discussed about the organization, its vision, mission, product and service offerings, its
organogram and the total compensation package we offered. We have also focused about the
financial projections of our organizations with cash flow, total capital, balance sheet etc. Here,
we can try to find out that what determining factors are affected our compensation programs in
our country perspective, because compensations system varies country to country. While
determining compensations, we must consider our other competitor position and market trends.
So comparing to other rivalry we try to determine our compensation and other allowance with
basic pay, because our company is a retail organization. Then we analyzed the non-compensation
program from the perspectives of both the employees and the employers. Later, we came up with
few recommendations of our own business that can utilize to enhance its employee satisfaction
which increase its productivity. We think that at last our effort will bring fruitful ending. So we
offer our product in a different way and it creates a unique position of our brand to the target
customer. Recently we Plan to run 1 outlays and expand 3 more outlays in Dhaka city,
Siddheswari (First branch), Bannai branch(Proposed). And the other two branches in
Dhanmondi(Proposed). We are planning to establish 3 more outlays in Chittagong and Rajshahi.
We are also trying to expand our business in out of the country. At present we hope to capture the
40% of the market share in this sector (Estimated). Though we have some limitation but we are
sure that we can be able to overcome that and touch the number 3 position providing better
compensation package.

Page 2

2. Description of the company

Name of the company Inter Fashion Boutique

Time of Establishment-

15, january,2016.

Type of Business-

Fashion and Jewelry Business.

Total Branch-

4(1st at siddeshwari in 2016, 2 in Dhanmondi in

2016. Banani and Rifles' square in 2017)

ND

Page 3

LocationE-mailWebsite-

34/B Mailbagh Chowdhury Para

Khan Villa, Dhaka-1219.
info@interfashionhouse.com
http://www.interfashionhouse.com/

Founder-

Sonia Akter, Tania Ahmed,Susan Farabi, Jufrin

Akter and shahidul Islam.

3. Mission statement:
This Company wants to succeed through a strong customer loyalty. For this, it has a mission and
vision. Vision is a long term outlook of an organization which is possibly impossible to achieve.
On the other hand, Mission is that part of vision which can be practiced or implemented. The
vision and Mission of INTER FASHION BOUTIQUE are given below

Vision:

Inter Fashion Boutique has a vision to establish them as Bangladeshs leading famous fair
trade fashion house, and to remain market leader. Throughout its business.

It expanded its business in international arena. Inter fashion house has a dream to develop
more artisans of Bangladesh and make them self-dependent and attract more and more
international customers towards Bangladeshi culture.

Mission:

To become one of the 3rd business tycoon in this sector of Bangladesh.

Providing Modern and latest designed clothing for men and women.

To maintain and expose the traditional culture of Bangladesh.

Creating loyal customer by fair pricing with quality product

Page 4

4. Organizational structure:

Managing
Director

Chief

General Manger

operating officer

Finance &
accounts

Deputy General
Manager
HR and training

General
Manager

General
Manager

Assistant
manager

Senior
manager

Administrative
and services

Design

Merchandizing

Quality
control

Senior
Manager

Information
technology

ve

E-commerce

Other employee
Designer
Sales personnel
Production supervisor/cutting master
Tailors and others
Total employee

Manager

30
52
40
33
155

Page 5

Marketing

Executive officer
Inventory
control

5. Product offering:
1. Mens clothing and Accessories
2. Womens clothing and Accessories
3. Kids clothing and Toys
4. Shoes (for men, women and kids)
5. Home Dcor
6. Office Accessories
7. Books and Stationery
8. Nakshi Kantha
9. Wedding Clothing and Accessories
10. Jewellery

11.Taaga
6. Financial structure:

Inter Fashion Boutique is financially strong. Its a partnership firm. It is not public limited
company so its still does not offer shares to the public and it does not published its annual
financial report to the public. It earns approximately 70% profit annually.

Inter
Fashion
Boutique

Dresses

Customers

Delivery

TK

Profit

Inter
Fashion
Boutique

Figure: Financial Model

Financial objectives:
To attain 95% sales growth rate by the year 2019.
To lever up the business at year 2018.
To attain net profit margin of 80% in 2016, 85% in 2017 and 90% in 2018.

Page 6

To offer quality products at a competitively lower price.

To maintain strong cash flow balances.

Capital requirements:

It started with 1, 00, 000, 00 taka. Its a partnership firm. There are six partners. All are invested
taka 70, 00, 000. And rest 30, 00,000 taka invested from the bank.

Investment from own source:

Investors

Amount (Taka)

Sonia Akter
(20%)
Tania Ahmed (20%)
Jufrin Akter (30%)
Susan Farabi (15%)
Shahidul Islam (15%)

14,00,000
14,00,000
21,00,000
10,50,000
10,50,000

Total

Tk. 70,000,00

Page 7

 Investment from Bank:

We take a long term loan from BRAC Bank, 13, 00,000 taka at the interest rate of 16.5% but
from this year we will pay interest rate at 17%.

Interest rate of bank loan:

2016-20
2021-24

Interest rate
16.5%
17%

Short term financing needs (1 year):

Monthly expenses: Shop rent, equipment purchase, workers wages, phone bills etc.
Inventory needs
Promotional needs: Advertisement, magazine, newspaper, internet etc.
Cash flow problem
Raw material purchase: Cloths.
Operating expenses
Other expenses

Page 8

 Long term financing needs (10 years):

For these types of needs we took bank loan:
Capital formation
Business startup cost
Long term marketing activities
Expansion of facilities
Machinery purchase

Start-up requirements:
Start-up expenses
Legal

TK 3,00,000

Rent

TK 5,00,000

Insurance

TK 200,000

Setup fixture

TK 3,00,000

Equipment

TK 10,00,000

Other

TK 4,00,000

Total start-up expenses

TK 27,00,000

Start-up assets

TK 10,00,000

Cash required

TK 5,00,000

Start-up inventory

TK 4,00,000

Other current assets

TK 5,00,000

Long term assets

TK 15,00,000

Total start-up assets

TK 39,00,000

Total start-up requirements

TK 66,00,000

Start-up funding:
Start-up expenses to
fund
Start-up assets to
fund
Loans

27,000,00

Investment

70,00,000

Page 9

39,00,000
30,00,000

Intra Fashion Boutique

Cash flow statement
(Estimated)
For the year ended 31st December, 2016
Particulars
Cash at hand(beginning of the year)
Cash flow from operations activities:
Cash receipt from customer
(-)Cash paid to suppliers and employees(8,33000+200,000)
Cash generated from operations
Cash flow from Investment Activities
Addition to equipment
Purchasing securities
Net cash flow from investment activities
Cash flow from Financial activities
Borrowing
Net cash flow from financial activities
Net increase in Cash at hand

Page 10

Tk.

Tk.
5,00,000

30,00,000
25,00,000
5,00,000
15,000,00
10,00,000
(25,00,000)
30,00,000
30,00,000
Tk.15,00,000

Inter Fashion Boutique

Income Statement (Estimated)

For The Year Ended December 31, 2016.
Dr.
Revenues:
Gross Revenues (including INTEREST income)
(-)Expenses:
Advertising
Salaries
Legal & Professional Services
Rent
Materials
Office expenses
Utilities
Commissions
Bank interest
Interest of capital
Entertainment
Insurance
Sales transportation
Total Expenses:
Operating Income-(2100000-1475000)
(-) Provision for income
Net Income=

Cr.
95,00,000

500,000
42,84000
3,00,000
3,00,000
1,71,000,
1,00,000
2,00,000
5,00,000
4,95000
7,00,000
1,00,000
2,00,000
150000
80,00,000
15,00,000
1,50,000
Tk.13,50,000

Inter Fashion Boutique

Balance sheet
(Estimated)
For the year ended, 31st December, 2016.
Particulars

Tk.

Assets:
Current Assets:
Cash
Bank Balance
Ending inventory(Finished Products)
Sundry Debtor
Advance expenses
Other current Assets

15,00,000
10,00,000
5,00,000
4,00,000
1,50000
5,00,000

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Tk.

Total current Assets=

Investment(Long term)
All Fixed Assets
Goodwill
Primary expenses
Total Fixed Asset
Total current and fixed Assets
Capital and Liabilities:
Current Liabilities
Long term liabilities

40,50000
15,00,000
35,00,000
9,50000
20,000,00
79,50000
Tk.1,20,000,00
5,00,000
30,00,000
150,000

Provision for income

Total liabilities

36,50000
7,00,000
13,50000

Capital
(+) net income
Total Equity
Total Capital and liabilities

83,50000
Tk.1,20,00,000

7. Marketing activity:

A pioneer in the country's craft industry, Inter's unique product designs have brought consumer
attention back to crafts and materials indigenous to Bangladesh, as its designers blend the
traditional with the contemporary in a way that continues to win consumer appeal. Its success
revolutionized trends and virtually created the market that has now been taken up by countless
other boutiques and brands. Inter caters to this growing urban consumer base through outlets in
every major city in the country. Their discerning style and high-quality craftsmanship make
every Inter product unique and demand for them has been consistently rising due to Inter's focus
on innovation, quality, value-based pricing and superior in-store customer service. All these
elements, backed by a robust distribution network and strong supply chain, have made Inter a
true household brand in Bangladesh. Just as Bangladeshis living abroad look to Inter for products
that connect them to their heritage, the Inter experience is an essential part of any trip to
Bangladesh by foreign visitors a phenomenon chronicled in the "Lonely Planet" guide to
Bangladesh. Inter products are not only the gift items of choice for every occasion for local and
expatriate Bangladeshis but also the quintessential cultural mementos for these visitors. Inter's
growing presence outside Bangladesh - through fair-trade networks in Europe as well as a retail
franchise in London - continues to broaden the market for Bangladeshi craft globally Inter
symbolizes fairness in the global village. Inter fashion house has a large and big rivalry such as
Aarong, Aanjans, Rang, Deshal. Kcraft, Banglar mela etc. they are decide their compensation
policy based on some criteria or factors actually private organizations cannot follow strict rules

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or policy regarding compensation. But as new comer we need to follow best and lucrative
compensation package to attract and retain our best employees.

The organization has identified three basic constraints for gainful employment of the low income
and marginalized people in the rural areas: lack of working capital, marketing support and
opportunity for skills development. In order to bridge these gaps, Inter provides a wide range of
services to its workers and suppliers:
Spot payment on product delivery to encourage efficiency and productivity
Reach out to producers in remote areas to ensure fair value for their efforts
Marketing communication and information for artisans
Advances against purchase orders where necessary
Training & Education in skills development to raise product quality and marketability
Product Design and Support in Product Development
Quality Control to increase producer awareness of the importance of quality

Inter Retail Outlets:

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Inter sales its products through its own outlets, Inter follow zero distribution channel. Around the
country Inter has ten outlets six outlets in Dhaka in six major parts (Dhanmondi, Gulshan, Uttara,
Maghbazar, Wari and Mirpur) and outside Dhaka Inter have two outlets in Chittagong, one in
Sylhet and one in Khulna. And outside Bangladesh Inter has one shop in London, United
Kingdom.

We set our price based on some things:

Cost of direct materials

Annual cost
Potentiality of cost
Administration and office cost

Promotion:
Young people of 25-35, for them Inter is a trusted brand. They visit the store often, buying
products mostly for gifts, sometimes for their own consumption. For them Inter provides the
reassurance that they have bought a quality product, thats their friends will appreciate as it is
from Inter. But they dont feel excited about brand. They miss out the excitement. They dont
feel it fits completely in their life the advertising should
Trigger strong interest among non-users to try the brand
Encourage regular usage
Establish the new Inter positioning

Program:
Inter fashion main marketing promotional activities are:
1.

Sponsorship making in various occasions like Pahela Baishakh, Pahela Falgun

2.

Various television programs dresses are courteous by Inter

3.

Social campaigning programs are co-operated by Inter

4. Price discounting is their promotional activities. Besides, all this a things they use TV
advertisement, Fashion show for their up-coming innovative products, Bill board advertisement
and so on.

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 Brand value:
Inter stands for a unique mix of design, quality and convenience, of the traditional and the
contemporary. Inter is one-of-a-kind globally positioned as a highly successful Bangladeshi craft
based retail chain and brand of pride. It also carries the distinction of being BRAC's most
successful social enterprise. Inter's responsibility is therefore two-fold - delivering unique
products with the highest level of quality and service to its customers and the strongest level of
support and protection of artisans and their craft. To its consumers, Inter is a household name - a
one-stop shop and a trusted brand that inspires pride, promises quality and sophistication, and
helps to keep cultural roots alive in everyday life. For the artisans, Inter represents the endurance
of both their age-old art as well as their livelihoods. For consumers and artisans alike, Inter has
become a part of the cultural fabric of their lives.

8. SWOT Analysis of Inter:

SWOT analysis is a powerful technique for understanding organizations Strength & Weakness
and looking for the Opportunities & Threats it may face. Used in a business context it helps
organization carve a sustainable niche in a market. This analysis is mainly based on an imaginary
situation.

Page 15

SWOT analysis of Inter

Strength
Inter is a very reputed organization. They are now capturing 68% of total handicraft market share
in Bangladesh. Its a local brand and now exporting their products outside of the country. Inter
has good reputation for fine quality products. It has a strong management team who are
continuously giving their great effort to make it a successful one. Another important fact is that,
Inter has almost Zero production damage rate which reduces their cost. They are innovative
and always bring some new product in the market which meets customer requirement and
expectations. The organization is a respected employer that values its workforce.

Weakness
Inter has a reputation for new product development and creativity. However, they remain
vulnerable to the possibility that their producer may not be able to produce product timely due to
their inability. The collection channel of the organization is not that much structured so that they
can get the products from the producer on time and it may create problem for them in future. If
any producer is not able to make the product on time due to some personnel problem then the
company will also not be able to deliver their product on time. This is a big problem and it
happens most of the time on delivery. Inter charges higher price relatively than their other
competitors as a result sometimes customers lose their interest to by product from them. Its sales
force or sales girls within the outlet are not properly trained up. Sometimes they make customers
disappointed by their attitude and customer doesnt feel good to buy from there. Sometimes they
suffer for financial problem, although its a rare situation.
Opportunities
Inter Fashion Boutique is very good at capturing the advantage of opportunities. It can go for
new distribution channel like it can make some joint venture with some other small Boutique and
sales its products in more places. Through that it can capture more market share in the hand.
Industry in Bangladesh. Inter can expand its business globally. New market for handicraft such
as Europe and America are beginning to emerge. People are now trendier about local events &
functions like PahelaFalgun, PahelaBaisakh, Victory day, Independence Day etc and they buy
new and special products for these events. Inter can make new products to sell in those special
occasions. According to the season change, people are also changing their preference in buying

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products and considering this scenario Inter can produce products on the basis of seasonal
variations.

Threats
Inter doesnt have any big competitors right now. But they have some small competitors like
KayKraft, Anjans, Deshal, Jattra, Khubsurti, Rina Latif, OZ, Rang and some other Boutiques
established at Banani 11, who are taking their 32% customer and increasing in a slow rate. Inter
always face price wars with their competitors. Its competitors have some superior products like
OGs Panjabi shape, Khubsurtis design of Salwar kamiz Rangs Sharis color, which is
decreasing Inters market share as well as sales. But now they are repositioning their Brand to
compete with them.

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Page 18

9. Compensation Packages of Inter Fashion Boutique

Compensation is the direct and indirect monetary and non-monetary rewards given to employees
on the basis of the value of the jobs, their personal contributions and their performance. When
making these payments one should be alive to the governing legal regulations and should be
complied with the existing practices of payments exercised in a particular country.

Dimension of Compensation system

There are 2 dimensions of compensation system. So while planning compensation packages we
need to consider the following two dimensions:

Compensation Dimensions

Non-compensation Dimensions

Pay for work and performance.

Enhance dignity and satisfaction from

work performed.

Pay for time not worked.

Enhance
intellectual
maturity.

Loss of job income continuation.

Promote constructive social relationship

with Co-workers.

Disability income continuation.

Design jobs that require adequate

attention and effort.

Deferred income.

Allocate sufficient resources to perform

work assignments.

Health, accident and liability protection.

Grant sufficient control over the jobs to

meet personal demands.

Income equivalent payments.

Offer supportive
management.

Page 19

physiological
growth and

health,
emotional

leadership

and

 Compensation Strategy

Contingent factors are:

Legal requirements or Govt. policies

Strength of Trade Unions
Labor market conditions &
Capacity of the organization to pay.

Compensation Philosophy while making compensation decision

Page 20

 Factors influencing Compensation policies

Page 21

Page 22

 Factors determination of Rates of Pay

Kinds and
levels of
required
knowledge
and skills

Union and
non-union
status

Kinds of
business

Capital
intensive
versus labor
intensive

Size of
business

Philosophy
of
management

Total
compensatio
n package

Geographic
location

Supply and
demand for
labor

Profitability
of a firm

Employment
stability

Gender
differences

Employee
tenure and
performance

Compensation structure

Basic
Pay
Other
perquisi
te

Allowan
ces(Taxa
ble)
Compens
ation and
Benifits

Reimbu
rsement
(Tax
free)

Benifits
Incentiv
es

Page 23

 Determination of Compensation
There are 5 major factors which we take into consideration while making compensation plan for
Inter Fashion Houses employees. And they are as follows:-

1. Incentives and bonus plans

They shouldn't be seen as a guaranteed payment,

but instead should be measured by performance
of the individual, team or company.

2. Understand the costs of a benefit plan

When assessing what benefits to add, consider

not only today's direct costs, but also long-term
expenses.

3. Calculation of employer payroll taxes Employers incur expenses, such as Social

Security and Medicare tax, unemployment
into the overall payroll budget.
insurance for both state and federal entities, and
workers' compensation insurance

4. Position of the employees

Does it best correlate with direct payment on an

hourly or salaried basis or is commission a
better arrangement?
For example-Employees in sales-related
positions should have commission as a part of
their compensation package

5. Payroll Budgeting

Payroll budgets need to include direct wage and

salary payments, commissions, bonuses,
incentives, payroll taxes and insurance, along
with any other directly related costs the business
incurs in the payroll function.

Page 24

So considering the above various aspects of Compensation program we plan our

compensation as follows:

Compensation budget
The amount of money companies spend on employee compensation each year represents a
significant portion of operating expenses. Average payroll costs run anywhere from 23% (retail)
to 41% (service firms) of the entire operating budget of an organization.
As a result, compensation planning is clearly one of the most important responsibilities of
todays compensation professional. Annual compensation planning involves preparing budgets to
address salary increases, salary structure adjustments, promotion increases and variable pay
expenditures. Typically, the budget process occurs well in advance of fiscal year end so that cost
projections can be included in operating budget forecasts for the coming year.
Although, our total asset we allotted a separated budget for our employee compensation
packages. Our estimate amount is
Inter fashion Boutique
Projected Work Salary Sheet
For the month of December 31, Year 201.
SL
No
1
2
3
4

5
6

7
8
9

Designation

No
employee
1
1

Managing director
Chief operating
officer
General manager
1
Finance & accounts
Deputy
general 1
manger
HR and Training
Manager
General manger
Administrative
&
services
General manger
Design
Assistant
manager
merchandizing
Senior
manger
quality control

of Working hour Salary

month
Office hour
75000
Office hour
70000
69000

85000

Office hour & 65000

when needed

81000

1
1

Office hour
Office hour

50000
48000

62000
55000

Office hour

40000

50000

Office hour & 38000

overtime
Office hour
35000

47000

Office hour

per Total salary

per month
100000
80000

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45000

10.

12.

Senior manger
Information
technology
Executive officer
Inventory control
E-commerce officer

14.

Marketing manager

15.

Designer

10

16.

Sales personnel

25

17.

Production master

40

18.

Tailors

33

11.

1
2

Office hour & 30000

when
emergency
Office hour
30000

37000

Office
hour
and in-house
job
Office
hour
and different
locations
Office
hour
and overtime
duty
Office hour &
Shift work
Office
hour
and extra duty

25000

32000

22500

38000

20000

28000

12000

18000

15000

20000

Office hour &

extra task when
needed

13500

15000

Total =

8,33,000

10.Conclusion

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40000

Page 27