Marketing Plan

___________________________________________________________________www.saltrocklamp.
com
TABLE OF CONTENTS
ABSTRACT......................................................................................................................4
ABSTRACT
EXECUTIVE SUMMARY...........................................................................................6
SUMMARY
COMPANY DESCRIPTION.......................................................................................7
DESCRIPTION
BUSINESS MODEL OVERVIEW............................................................................8
OVERVIEW
ABOUT SALT ROCK LAMPS.COM....................................................................8
LAMPS.COM
VISION.........................................................................................................................9
VISION
MISSION......................................................................................................................9
MISSION
OBJECTIVES..............................................................................................................9
OBJECTIVES
COMPANY SUMMARY.............................................................................................11
SUMMARY
TARGET......................................................................................................................11
TARGET
KEYS TO SUCCESS................................................................................................11
SUCCESS
PRODUCTS...................................................................................................................14
PRODUCTS
PRODUCT DESCRIPTION..................................................................................14
DESCRIPTION
PRODUCT CATEGORIES....................................................................................15
CATEGORIES
COMPETITORS.......................................................................................................15
COMPETITORS
COMPETITIVE ADVANTAGE................................................................................16
ADVANTAGE
QUALITY....................................................................................................................16
QUALITY
PRICING....................................................................................................................16
PRICING
DISTRIBUTION & PRICING..............................................................................16
PRICING
PAYMENT STRATEGY.........................................................................................16
STRATEGY
MARKET ANALYSIS SUMMARY.....................................................................17
SUMMARY
MARKET SEGMENTATION...............................................................................17
SEGMENTATION
TARGET MARKET SEGMENT STRATEGY..................................................19
STRATEGY
INDUSTRY ANALYSIS.........................................................................................19
ANALYSIS
STRATEGY AND IMPLEMENTATION...............................................................20
IMPLEMENTATION
STRATEGY PYRAMIDS.......................................................................................21
PYRAMIDS
VALUE PROPOSITION........................................................................................21
PROPOSITION
COMPETITIVE EDGE...........................................................................................22
EDGE
MARKETING STRATEGY.......................................................................................23
STRATEGY
1. Positioning Statements................................................................................23
2. Pricing Strategy..............................................................................................24
3. Multiple unit pricing.....................................................................................24
4. Membership or trade discounting..........................................................24
SWOT ANALYSIS.......................................................................................................25
ANALYSIS
STRENGTHS............................................................................................................25
WEAKNESSES.........................................................................................................26
OPPORTUNITIES...................................................................................................27
THREATS...................................................................................................................27
SALES STRATEGY.................................................................................................27
STRATEGY
Sales Forecast......................................................................................................28
SALES PROGRAMS...............................................................................................29
PROGRAMS
Specific sales programs:.................................................................................29
___________________________________________________________________www.saltrocklamp.com
MANAGEMENT PLAN..............................................................................................30
PLAN
ORGANIZATIONAL STRUCTURE...................................................................30
STRUCTURE
MANAGEMENT TEAM.........................................................................................31
TEAM
PROFILE:..................................................................................................................31
PROFILE:
MARKETS:................................................................................................................31
MARKETS:
MANAGEMENT TEAM GAPS............................................................................31
GAPS
PERSONNEL PLAN...............................................................................................32
PLAN
FINANCIAL PLAN......................................................................................................33
PLAN
IMPORTANT ASSUMPTIONS...........................................................................33
ASSUMPTIONS
KEY FINANCIAL INDICATORS........................................................................34
INDICATORS
BREAK-EVEN ANALYSIS...................................................................................34
ANALYSIS
PROJECTED PROFIT AND LOSS.....................................................................36
LOSS
PROJECTED BALANCE SHEET.......................................................................36
SHEET
A WORD OF GRATITUDE
After acknowledging the blessing of our Allah in helping me in my efforts, I would
like to thank all of the other helping hands who were with me in the making this
report a possibility.
I would then like to thank my adviser Mr. Abid Saeed for giving me the
opportunity to carry out this knowledge-full analysis. Thank you Sir.
As you go along the path to the completion of a project, you meet so many people
that help and assist you in one way or the other I thank them from the bottom of
my heart.
ABSTRACT
A salt lamp is simply a chunk of mined salt that has been hollowed out to allow
room for a lightbulb or tiny candle. The light glows through the medium of the
salt crystal, which can range in color from a dark salmon pink to a pale orange.
Salt crystals for salt lamps are mined in Russia and central Europe as well as in
the Himalayas. Salt lamps make attractive accent lights. Their main attraction,
however, is that the heating of the salt causes the crystal to release negative ions
(often called simply 'ions').
Negative ions have long been considered healthy; the sea air, mountain air and
the air around swiftly running water is high in negative ions. Indoor air,
recirculated air, and air around electronic equipment is very low in negative ions.
Many office workers who suffer health complaints around fluorescent lighting
and computer monitors report considerably less fatigue and headaches if the
concentration of negative ions in the air is increased. Why negative ions may be
beneficial is only partially understood.The salt lamp is an attractive alternative to
the utilitarian look of an air purifier.
The amount of negative ions a salt lamp can release depends on its size and how
warm the candle or light bulb can make it. The larger the crystal, obviously, the
more expensive the lamp, but the larger area it can provide with negative ions.
Salt lamps that produce 'night-light' amounts of light can provide ions to an area
equal to the average office cubicle.
www.SaltRockLamp.com is website that is subsidiary of Saharuns Enterprises
who make these lamps and make them available to the customers though this
website. In the following report we have analysed the business module of
SaltRockLamps.com with particular emphasis on the Marketing Strategy.
EXECUTIVE SUMMARY
Saharuns Enterprises has been riding a growth spurt, having discovered the
high-end direct mail channel that gave it a push to new potential volumes
through channels. Bolstered by appearances in specialty catalogues, it was able to
develop another additional channel through distributors of office equipment that
sell directly to corporations.
This annual business plan calls for another three years of accelerated growth.
Because its sales growth has brought some working capital implications, the
management is carefully planning to manage growth and provide for steady cash
flow.
The company also expects to be profitable as never before. In all, this plan is a
healthy company with good growth prospects, looking to manage its orderly
growth in the near future.
AHARUNS ENTERPRISES
w w w . S a l t R o c k L a m p . c o m
COMPANY DESCRIPTION
Salt Rock Lamp is a subsidiary of Saharuns Enterprises, manufacture the widest
range of Salt Rock Products; lamps, tea lights, bath items (soaps, chunks) and
misc show pieces.
The company offers quality blended with very competitive prices and can
continues to ship worldwide.
Web:http://www.saltrocklamp.com
Business address:
#3 - Mezzanine Floor, (66 West) Junaid Plaza,
Jinnah Avenue, Blue Area, Islamabad 44000,
PAKISTAN.
Telephone:
(Manager Business Ops): +92 (333) 522 8758
(Manager Export Ops): +92 (320) 426 7099
Office: +92 51 2273206, +92 51 2873002 (Fax)
Business hours:
0900 hrs - 1800 hrs (+05:00 GMT)
Monday - Saturday
Email:
contact@saltrocklamp.com
contact@saharuns.com
BUSINESS MODEL OVERVIEW

ABOUT SALT ROCK LAMPS.COM
Adjusting temperature and humidity is not the only key to fresh air. Your air
must be properly ionized. Don't poison your life. Ionize the air around you, the
air of your homes and offices for a healthy living and life style.
Salt Rock Lamps are natural air ionizers, air purifiers and natural healers. They
bring a positive change in your life through negative ions.
SaltRockLamp.com offers a wide variety of aesthetically made natural air ionizers
both as lamps and candle lights. Match your mood,
life style and pocket. We always provide the best
possible value to our customers who care about
quality and we want every dollar spent with us to be
well spent. We also create and nurture a healthy,
creative, respectful, and fun office and workshop
environment, in which our employees are fairly
compensated and encouraged to respect the customer and the quality of the
product we produce. We seek fair and responsible profit, enough to keep the
company financially healthy for the long term and to fairly compensate owners
and investors for their money and risk.
VISION
The vision of the company is: To strive for excellence through commitment, integrity, honesty and team
work
MISSION
"To provide quality salt lamps both handmade & machine made with natural &
innovative designs enriched with strong customer support to satisfy our
customers & clients"
OBJECTIVES
The company will conduct its operations prudently assuring customer
satisfaction and will at all time put quality as its first and fore most goal, this will
be done through:
Providing quality products to our customers.
To strive for excellence and sustain position as a positive image in

the mind of our customers
Providing quality salt rock products as per customer demands.
Keeping pace with the rapidly changing technology by continuously

using the most modern techniques and methods so as to enhance
efficiency and productivity and provide maximum satisfaction to
the consumers.
Enhancing the profitability by improved efficiency and cost

controls.
Recruiting, developing, motivating and retaining the personnel

having exceptional ability and dedication by providing them good
working environment, performance based compensation, attractive

benefit program and opportunity for growth.
Maximum emphasis is to be laid on TEAM WORK for maximum

customer satisfaction.
Contribute toward the economic growth of the country and function

as a good corporate citizen.
[[
COMPANY SUMMARY
Saharuns Enterprises, Pakistan was founded in 1996 as a government
contractor, constructor and general order supplier. It expanded its business to
manufacturing and marketing of natural products including Salt Rock Lamps in
2003.
Saharuns Enterprises plans to open permanent distribution networks in UK,
Germany, Australia, USA and Belgium, supplying the growing demands of
European, Australian and USA markets.
SaltRockLamp.com is a fully owned subsidiary of Saharuns Enterprises,
Pakistan. Its major production facilities are located in Pakistan because Pakistan
has been bestowed with world's finest of Himalayan Rock Salt with world oldest
and second largest mine in Khewra.
Profitability and working capital were problems during our recent growth, but we
believe we now have costs and cash flow under control.
TARGET
Focus on the new channels to increase sales beyond the $1 million mark by 2005.
Maintain a gross margin close to 60%, despite the sales increase.
Increase the net profit to more than 7.5% of sales by 2005
KEYS TO SUCCESS
Uncompromising commitment to the quality of the end product:
Quality rocks, quality workmanship, quality design, quality of end result.
10
Successful niche marketing: We need to find the quality-conscious customer in

the right channels, and we need to make sure that customer can find us.
PAST PERFORMANCE
2002
2003
2004
Sales
$127,809
$130,568
$225,790
Gross Margin
$58,381
$72,374
$105,245
Gross Margin %
45.68%
55.43%
46.61%
Operating Expenses
$54,602
$69,801
$90,125
36
4.00
4.70
6.00
Collection Period (days)

Inventory Turnover
BALANCE SHEET
Current Assets
2002
2003
2004
Cash
$0
$0
$1,438
Accounts Receivable
$0
$0
$27,605
Inventory
$0
$0
$10,141
Other Current Assets
$0
$0
$2,375
Total Current Assets
$0
$0
$41,559
Long-term Assets
Capital Assets
$0
$0
$3,210
Accumulated Depreciation
$0
$0
$1,720
Total Long-term Assets
$0
$0
$1,490
Total Assets
$0
$0
$43,049
Capital and Liabilities

Accounts Payable
$0
$0
$11,191
Current Borrowing
$0
$0
$0
Other Current Liabilities
$0
$0
$1,803
Subtotal Current Liabilities
$0
$0
$12,994
Long-term Liabilities
Total Liabilities
$0
$0
$12,994
Paid-in Capital
$0
$0
$4,500
Retained Earnings
$0
$0
$13,100
Earnings
$0
$0
$12,455
Total Capital
$0
$0
$30,055
11
Total Capital and Liabilities
$0
$0
$43,049
1995
1996
1997
Payment Days
35
Sales on Credit
$0
$0
$140,434
0.00
0.00
5.09
Other Inputs
Receivables Turnover
12
PRODUCTS
Saharuns Enterprises offers very high quality salt rock lamps designed to
effectively Ionize the air around you, the air of your homes and offices for a
healthy living and life style.
PRODUCT DESCRIPTION
The product offered by SaltRockLamp.com is Salt Rock Lamps. The result of this
discovery quickly led to the making of a lamp with a crystal salt top and a bulb in
it. This being the best means to attract people to opt this mechanism to ionize
their air. Salt Rock Tea light was a later variant based on the needs of the
customers.
The effective negative ion produced by a salt rock lamp depends on many factors.
Heated salt crystals produce negative ions. Most importantly the size, surface
area and the amount of heat produced. As a rule of thumb, bigger lamps produce
more negative ions. The following table is generally used to find the appropriate
size for a room.
Room Size
10 sq m
15 sq m
20 sq m
Lamp Size
2 - 3 Kg
4 - 6 Kg
7 - 10 Kg
As a general rule, add 3 - 4 Kg of salt rock for an increase of 10 sq m in a room

size. Based on natural rock every salt item is unique and different.
PRODUCT CATEGORIES
13
There are different categories of the natural salt rock lamps available. These
include:
Natural Lamps
Smooth Lamps
Smooth Tealights
Natural Tealights
Classic Lamps
Mushroom Lamps
Bath Items
Decorative Stuff
Bricks & Tiles
Misc Lamp Items
COMPETITORS
There are a number of competitors of salt rock lamps. A few of them are:
www.paksaltlamp.com
www.chamberofcommerce.com
www.asian-handicrafts1.com
14
COMPETITIVE ADVANTAGE
QUALITY
Saharuns Enterprises strives to work hard to provide the best quality salt
products to the buyers. The company does not only strive in supplying the best
products, but also implement quality in procedures as well.
PRICING
The prices are exceptionally genuine and cheap. The company believes in 'passing
on' the 'great deals' that it gets to its customers. So that is why it continuously fine
tunes the prices of its items. Saharuns Enterprises believes in sustainable and
reasonable profits. The people at Saharuns Enterprises say that we wish to see
our customers get back to us
DISTRIBUTION & PRICING

SaltRockLamp.com has tried to list the details that will affect the price its
customers have to pay but given an international audience, since it is not possible
to calculate one figure for all. That is why the company implements online
ordering only after exchanging the final BEST POSSIBLE costs with its
customers.
PAYMENT STRATEGY
SaltRockLamp.com relies on the industry standard, Paypal, for receiving
payments. Paypal provides military standard encryption for such transactions
thus shrinking the chances of any misuse of critical information (like contact info
and credit card number etc) to zero.
15
MARKET ANALYSIS SUMMARY

The target market of the company is a person who wants to have very fine rock
salt lamps with the latest in technology, combined with an old fashioned sense.
This person can be in the corporate towers, small or medium business, or in a
home office.
It is also undeniable fact that our living and working places are filled with dust
dander allergens, pollen dust mites and mold spores; all of these are lethal for our
health.
To get pure air we get the salt lamps. The common bond is the
appreciation of quality, and the lack of price constraints.
MARKET SEGMENTATION
Salt Rock Lamp, because of its characteristics as air ionizer and purifier should be
used in every place where one has to stay for a longer period of time. This
includes:
Bedrooms,
Living rooms,
Offices,
Kitchens.
The decorative properties also make it appropriate in drawing rooms and guest
rooms.It also has a significant use in:
Restaurants,
Hotels,
Hospitals,
Clinics,
Schools.
16
MARKET ANALYSIS
MARKET ANALYSIS
Potential
Growth 1999
Customers
2000
2002
2003
2004
CGR
Small
business
owners
4%
11,000,000 11,440,000 11,897,600 12,373,504 12,868,444 4.00%
Home
offices
10%
36,000,000 39,600,000 43,560,000 47,916,000 52,707,600 10.00%
Other
3%
1,000,000
Total
8.23%
50,500,000 54,595,000 59,068,750 63,957,984 69,303,064 8.23%
1,030,000
1,060,900
1,092,727
1,125,509
3.00%
TARGET MARKET SEGMENT STRATEGY

SaltRockLamp.com plans to open permanent distribution networks in UK,
Germany, Australia, USA and Belgium, supplying the growing demands of
European, Australian and USA markets. The enterprise is definitely out to
address the needs of the high-end buyer, who is willing to pay more for quality.
17
INDUSTRY ANALYSIS
The salt rock lamp industry has undergone a great deal of change in this decade.
The growth of the office superstores made a few large brands dominant. They
produce relatively inexpensive salt rock lamp that makes compromises in order
to stay at the low price level.
Makers of higher quality salt rock lamp are in general shuffling for niches to hide
in. Although Saharuns Enterprises was essentially developed around a niche,
many of the more traditional salt rock lamp makers are looking for niches, trying
to deal with declining sales as the main volume goes elsewhere.
18
STRATEGY AND IMPLEMENTATION

SaltRockLamp.com focuses on a special kind of customer, the person who wants
very high quality salt rock lamp customized to work beautifully with modern
technology. The customer might be in larger corporations, small or medium
business, or in a home office with or without a home-office business. What is
important to the customer is:
Elegance,
Fine workmanship,
Ease of use,
Ergonomics,
Practicality.
SaltRockLamp.com marketing strategy assumes that it needs to go into specialty

channels to address its target customer's needs. The tie-in
with the high-end quality lamps. It positions as:
The highest quality,
Offering status and,
Prestige levels of purchase.
The product strategy is also based on quality, in this case the intersection of
technical understanding with very high quality materials.
The most important competitive edge is the assembly strategy, which is based on
interlocking salt rock pieces of such high quality that assembly is not only a
pleasure for the companys customers, it is actually a feature that enhances the
sense of quality.
19
STRATEGY PYRAMIDS
The main strategy at Saharuns Enterprises is to position SaltRockLamp.com at
the top of the quality scale, featuring a combination of superb technology, for the
buyer who wants the best quality regardless of price. Tactics underneath that
strategy include research and development related to new designs and new
technology, choosing the right channels of distribution, and communicating
quality position to the market. Programs are mainly those listed in the milestones
table, including:
New design programs,
New equipment to keep up with design,
Channel development,
Channel marketing programs,
direct sales, and
New presence in the web.
VALUE PROPOSITION
SaltRockLamp.com gives the discriminating user, who cares about design and
quality salt rock lamp and quality of working environment, a combination of
highest quality salt rock lamp and latest technology, at a relatively high price.
COMPETITIVE EDGE
The competitive edge of SaltRockLamp.com is dominance of high-technology
ergonomics and traditional high-quality salt rock lamp workmanship. Although
there are many salt rock lamp manufacturers.
20
MARKETING STRATEGY
The product is positioned very carefully: this is high-quality salt rock lamp
combining workmanship and ergonomics for the customer who understands
quality, is a user of high technology equipment, and is willing to spend money on
the best. Unlike the mainstream products, SaltRockLamp.com does not use
laminates or cheap manufacturing technology.
SaltRockLamp.com marketing strategy is based mainly on making the right
information available to the right target customer. SaltRockLamp.com can't
afford to sell people on its expensive products, because most don't have the
budget. What SaltRockLamp.com really does is make sure that those who have
the budget and appreciate the product know that it exists, and know where to
find it.
The marketing has to convey the sense of quality in every picture, every
promotion, and every publication. SaltRockLamp.com can't afford to appear in
second-rate catalogs with poor illustrations that make the product look less than
it is. They company also need to leverage its presence using high-quality catalogs
and specialty distributors.
1. Positioning Statements
For discriminating users who want to ionize the air with fine salt rock
lamp, the SaltRockLamp.com, offers exquisite workmanship and design
combined with state-of-the-arts ergonomics and technology. Unlike the
Acme line, SaltRockLamp.com, makes no design compromises for
standardization.
21
2. Pricing Strategy
Price is an often overlooked marketing strategy, as many tend to focus on
promotions or advertising. Pricing strategies, however, can have a large
impact on sales and (more importantly) profit.
In the case of products not sold directly to the end user, pricing is often
described as wholesale and retail. When the distribution channel is
long (such as when there is a manufacturer, broker/distributor, retailer,
and end consumer), multiple mark-ups can occur between the wholesale
and the retail price.
3. Multiple unit pricing
Also called quantity discount. The customer gets a lower price for
purchasing multiple units or large quantities.
4. Membership or trade discounting
Here, some customers (those that are heavy or frequent purchasers) are
given an elite status, which gives them the privilege of a price discount on
their purchases. This elite status can be based on occupation, membership
in an organization, subscription status, or some other criteria.
SaltRockLamp.com believes in passing our "great deals" to the
customer The company strives at finding the best deals available for a
particular product, in terms of prices and quality.
The prices listed on this website are "Single Item Order" prices
"Excluding Packing, Shipping and Handling Costs" whatsoever,
unless otherwise specified.
SaltRockLamp.com charges the actual shipping costs that are likely to be
incurred by shipping to that destination. This is found based on experience
22
and with continuous contact with the Courier Companies like FedEx, UPS,
TNT, DHL, TCS etc.
Combined, smart use of both the Internet and available pricing strategies
can help boost the companys bottom line.
SWOT ANALYSIS
STRENGTHS
Close proximity to the one of the biggest salt mines in the world: the
Khewra mines
Cheap raw material
Cheap and readily available labour
Product Differentiation compared to regular lamps, some of these factors

are:
o Natural ionizes actually help to clean the atmosphere in any room.
o The color frequency has been proven to have profound impact on
many ailments. These unique lights emit a calming soft `amber
glow while their low heat frees the crystals' natural negative ions to
gently purify the air of dust and allergens.
o The crystal salt lamp can enhance goodwill, lighten ones aura,
eliminate mood swings, and diminish negativity. It can stimulate
the acupuncture and acupressure meridians.
o Crystal salt also acts as a catalyst to meditation.
o The crystal salt lamp brings relaxation to mind
o The gentle heat of the lamp in the salt crystal creates a higher
surface temperature than the surrounding air.
o It purifies the air.
23
o Rock Salt crystal is known to be one of the most efficient emitters of

negative ions that improve the air quality.
o Salt lamps can be used for light therapy and they can be used to
adjust our emotional conditions.
o Salt comes in a very useful spectrum of colors that create different
moods. So you can choose one or more to fit your current condition.
o The beautiful and rich color of the crystal salt lamps has been
known to be useful in color therapy.
Renowned Strategic Partners such as Fed Ex
Distributed all over the world
WEAKNESSES
Less knowledge about the benefits of these lamps among the people
High prices
Narrow segment targeting
No mass marketing
OPPORTUNITIES
Export opportunities
Making other salt products
Using mass media as a means for marketing
THREATS
Cheap local and foreign competitors
Changing policies of the government
24
SALES STRATEGY
The sales strategy at SaltRockLamp.com focuses first on maintaining the identity
with the high-end buyer who appreciates the best available quality. The company
been able to find customers using a combination of direct mail catalogues and
direct sales to distributors.
For the next year SaltRockLamp.com continues to focus on growing presence in
the high-end direct mail catalogue that finds its specialty customer. It will work
with Sharper Image and Broadview more than ever, and expects to gain position
in the major airline catalogue as well. Specialty retail is a new channel that could
become important.
The companys work with distributors has been promising and it hopes to
continue the relationship with distributors selling directly to larger corporations,
even though this takes working capital to support receivables.
Sales Forecast
SaltRockLamp.com sales forecast assumes no change in costs or prices,
which is a reasonable assumption for the last few years.
The company is expecting to increase sales grow from $225 thousand last
year to $450 thousand in the next year, which is about doubling in size.
The growth forecast is in line with last year, and is relatively high for our
industry because the company is developing new channels. In 2004 and
2005 SaltRockLamp.com expects growth closer to 50% per year, to a
projected total of more than $1 million in 2005.
25
SaltRockLamp.com is projecting significant change in the product line, or

in the proportion between different lines.
SALES MONTHLY
SALES PROGRAMS
Specific sales programs:
Distributor sales: SaltRockLamp.com needs to develop at least new
distributor, spending for co-promotion as required, and making direct
sales calls. The specific responsibility is Jan's, and due date is May 15, with
a budget of $15,000.
Direct sales: SaltRockLamp.com will do a mailing of a new in-house
catalogue, developed by the marketing department, to add to our direct
telephone sales. Jan will be responsible, without a budget or a deadline
because the catalogue is a marketing program.
26
MANAGEMENT PLAN
Saharuns is a small company owned and operated by Saharuns Enterprises. It
expanded its business to manufacturing and marketing of natural products
including Salt Rock Lamps in 2003.
Management style reflects the participation of the owners. The company respects
its community of co-workers and treats all workers well it attempts to develop
and nurture the company as community the company claims that it is not very
hierarchical.
ORGANIZATIONAL STRUCTURE
The President, is responsible for overall business management. Managers of
finance, export, marketing, and sales report directly to the specific department
managers.
The designer is responsible for product design and development, assembly, and
manufacturing. The workshop manager reports directly to the manager of the
concerned department.
Co-owners, jointly develop business strategy and long-term plans. The managers
are strong on product know-how and technology and are also strong on
management and business know-how.
MANAGEMENT TEAM
27
President had a successful career in retail before becoming half owner of

Saharuns Enterprises.
PROFILE:
Factory Location: Islamabad/Gujranwala
Established in: 1996
No. of Employee: 10
MARKETS:
North America
South America / Caribbean
West Europe
East Europe / Russia
East Asia
Southeast Asia
Mid-East / Africa
Australia / New Zealand
China / Hong Kong
MANAGEMENT TEAM GAPS

The company admits that it does not have a strong background in finance or
business management. It has a few employees working to run the enterprise and
the business of salt lamps efficiently.
PERSONNEL PLAN
28
The personnel table assumes slow growth in employees, and 10% per annum pay
raises. Saharuns already have a strong benefits policy (with fully-paid medical,
dental, and life insurance, plus a profit sharing and 401K plan) and very low
turnover.
Salaries are generally in line with market pay for the Eugene area, although
Saharuns benefits are above standard market level, so it ultimately pay a bit
more for our people than what might be considered standard in our market.
Eugene, however, is on average a lower wage location than most of the more
developed industry areas.
29
FINANCIAL PLAN
The financial picture of the company is quite encouraging. It been slow to take on
debt, but with increase in sales it does expect to apply for a credit line with the
bank, to a limit of $150,000. The credit line is easily supported by assets.
It also expects to be able to take some money out as dividends. The owners don't
take overly generous salaries, so some draw is appropriate.
IMPORTANT ASSUMPTIONS
The accompanying table lists the companys main assumptions for developing
our financial projections. The most sensitive assumption is the collection days. It
would like to improve collection days to take pressure off of its working capital,
but the increasing sales through channels makes the collection time a cost of
doing business.
The company also expects to see a decline in its inventory turnover ratio, another
unfortunate side effect of increasing sales through channel. The company finds
itself having to buy earlier and hold more finished goods in order to deal with
sales through the channel.
GENERAL ASSUMPTIONS
2002
2003
2004
Current Interest
Rate
10.00%
10.00%
10.00%
Long-term Interest
Rate
9.00%
9.00%
9.00%
Tax Rate
25.42%
25.00%
25.42%
Sales on Credit %
75.00%
75.00%
75.00%
Plan Month
30
Other
KEY FINANCIAL INDICATORS

The following chart shows changes in key financial indicators: sales, gross
margin, operating expenses, collection days, and inventory turnover. The growth
in sales will be very hard to manage. Saharuns expects its gross margin to be a bit
lower than before, because its projections show a slight decline as we goes into
new product areas and face new competition.
The projections for collection days and inventory turnover show that Saharuns is
already expecting a decline in these indicators, because of increasing sales
through channels.
BREAK-EVEN ANALYSIS
Saharuns break-even analysis is based on running costs, the "burn-rate" costs
that are incurred to keep the business running, not on theoretical fixed costs that
would be relevant only if the company was closing. Between payroll, rent,
utilities, and basic marketing costs, the company thinks $40,000 is a good
estimate of fixed costs.
Its assumptions on average unit sales and average per-unit costs depend on
averaging. The company don't really need to calculate an exact average, this is
close enough to help us understand what a real break-even point might be.
The essential insight here is that our sales level seems to be running comfortably
above break-even.
BREAK-EVEN ANALYSIS
31
Break-even Analysis
Monthly Units Break-even
67
Monthly Revenue Break-even
$80,000
Assumptions
Average Per-Unit Revenue
$1,200.00
Average Per-Unit Variable Cost
$600.00
Estimated Monthly Fixed Cost
$40,000
PROJECTED PROFIT AND LOSS

Saharuns expects a significant increase in profitability the year 2005, and in the
future, because it has learned how to deal with the increasing sales levels of
32
selling through channels. Despite the lower profitability levels of recent years, the
company expects to pass 5% in 1998, and remain at that level through 2000.
The companys higher sales volume has lowered our cost of goods and increased
our gross margin. This increase in gross margin is important to profitability.
PROJECTED BALANCE SHEET

Saharuns projected balance sheet shows an increase in net worth to more than
$400 thousand in 2005, at which point it expects to be making 17% profit on
sales of $1.1 million. With the present financial projections it will be careful in
supporting the working capital credit line, the company is growing assets both
because it wants to -- new equipment -- and because it has to grow receivables
and inventory to support growth in sales through channels.
PRO FORMA BALANCE SHEET

Assets
Current Assets
1998
1999
2000
Cash
$88,134
$158,162
$313,044
Accounts
Receivable
$74,179
$113,862
$179,630
Inventory
$48,280
$73,804
$116,220
Other Current
Assets
$2,375
$2,375
$2,375
Total Current
Assets
$212,968
$348,203
$611,269
Long-term Assets
Long-term Assets
$53,210
$73,210
$103,210
Accumulated
Depreciation
$2,720
$3,820
$5,020
Total Long-term
Assets
$50,490
$69,390
$98,190
Total Assets
$263,458
$417,593
$709,459
Liabilities and Capital
33
Current Liabilities
1998
1999
2000
Accounts Payable
$8,791
$9,988
$14,725
$115,000
$165,000
$265,000
$1,803
$1,803
$1,803
$125,594
$176,791
$281,528
Current Borrowing
Other Current
Liabilities
Subtotal Current
Liabilities
Long-term Liabilities
Total Liabilities
$125,594
$176,791
$281,528
Paid-in Capital
$54,500
$54,500
$54,500
Retained Earnings
$25,555
$83,364
$186,302
Earnings
$57,809
$102,938
$187,130
Total Capital
$137,864
$240,802
$427,931
Total Liabilities and

Capital
$263,458
$417,593
$709,459
Net Worth
$137,864
$240,802
$427,931
34

Marketing Plan

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___________________________________________________________________www.saltrocklamp.

BUSINESS MODEL OVERVIEW

Providing quality products to our customers.

To strive for excellence and sustain position as a positive image in

Providing quality salt rock products as per customer demands.

Keeping pace with the rapidly changing technology by continuously

Enhancing the profitability by improved efficiency and cost

Recruiting, developing, motivating and retaining the personnel

working environment, performance based compensation, attractive

Maximum emphasis is to be laid on TEAM WORK for maximum

Contribute toward the economic growth of the country and function

Successful niche marketing: We need to find the quality-conscious customer in

Collection Period (days)

Other Current Assets

Total Current Assets

Total Long-term Assets

Capital and Liabilities

Other Current Liabilities

Subtotal Current Liabilities

Total Capital and Liabilities

As a general rule, add 3 - 4 Kg of salt rock for an increase of 10 sq m in a room

Bricks & Tiles

Misc Lamp Items

DISTRIBUTION & PRICING

MARKET ANALYSIS SUMMARY

appreciation of quality, and the lack of price constraints.

11,000,000 11,440,000 11,897,600 12,373,504 12,868,444 4.00%

36,000,000 39,600,000 43,560,000 47,916,000 52,707,600 10.00%

50,500,000 54,595,000 59,068,750 63,957,984 69,303,064 8.23%

TARGET MARKET SEGMENT STRATEGY

STRATEGY AND IMPLEMENTATION

SaltRockLamp.com marketing strategy assumes that it needs to go into specialty

New design programs,

New equipment to keep up with design,

Channel marketing programs,

direct sales, and

New presence in the web.

Cheap raw material

Cheap and readily available labour

Product Differentiation compared to regular lamps, some of these factors

o Rock Salt crystal is known to be one of the most efficient emitters of

Renowned Strategic Partners such as Fed Ex

Distributed all over the world

Narrow segment targeting

Making other salt products

Using mass media as a means for marketing

Cheap local and foreign competitors

Changing policies of the government

SaltRockLamp.com is projecting significant change in the product line, or

President had a successful career in retail before becoming half owner of

Factory Location: Islamabad/Gujranwala

Established in: 1996

South America / Caribbean

East Europe / Russia

Australia / New Zealand

China / Hong Kong

MANAGEMENT TEAM GAPS

KEY FINANCIAL INDICATORS

Monthly Revenue Break-even

Average Per-Unit Revenue

Average Per-Unit Variable Cost

Estimated Monthly Fixed Cost

PROJECTED PROFIT AND LOSS

PROJECTED BALANCE SHEET