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TEAM NEMESIS
BUSINESS PLAN

COLLEGE OF ENGINEERING PUNE






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Executive Summary:

Mission:
Through Nemesis we intend to provide a highly user-friendly and flexible, economic All
Terrain Vehicle for the weekend enthusiast as a substitute for the present utility vehicles.
NEMESIS will provide to be the adventurer’s vehicle, in a safe, economic and excitement
filled way.

Overview-Team Nemesis
Team Nemesis, located in Pune, Maharashtra consists of a team of 25 highly dedicated and
professional personnel, headed by Mr. Ganesh Bachhav. The team is extremely passionate
about the work it does and is in a constant endeavor to improve itself and to adapt to
emerging customer needs. Through the company, the team aims at tapping a relatively
developing market with a promising potential.

The concept - ATV:
High torque, nimble, and easy steering for a weekend enthusiast, NEMESIS, an all-terrain
vehicle (ATVs) is single-seater off-road motorized vehicle featuring sturdy suspension,
steering wheel and a large comfortable solo seat. There are many compelling reasons for
the high level of interest in ATV riding among a wide range of consumers and businesses
The vehicle is for the hardworking executive who unwinds on weekends through escapades
in nature, the nature lover who wants to explore and discover and break loose from the
monotonous and polluted life of the city and for the adventure loving person who wants to
prove his metal in the rugged terrain.
There are very few dedicated ATV manufacturer in India. People have to compromise with
SUV or MUV in place of ATV, which is one of the reasons the ATV market has not expanded.
Nemesis will provide a solution to customers by launching ATVs that are not only great in
performance but also highly economical. ATV riders have plenty of use for their machines –
transporting gear to hiking spots, hunting grounds and campsites, exploring the beauty of
the back country. Packed with value and bristling with user-friendly technology, NEMESIS
will be a winning proposition.
ATVs make hard work worth doing, not to mention more enjoyable.
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NEMESIS-Maiden Product Of The Company

The design of each subsystem used in NEMESIS is done by separate teams dedicated for the
same purpose. It consists of mainly five subsystems and all are designed with ergonomics
and cost considerations.
The five subsystems:
1. Roll cage: The roll cage design was created with a view of ensuring maximum driver
safety and achieving ease in final assembly.
2. Suspension: An off road vehicle demands a robust suspension so Double wishbone
suspension is used and Custom springs are also designed to aid the shock absorbing
capacity.
3. Engine & transmission: High torques at low vehicle speeds and a fairly high top speed
with enough torque in higher gears.
4. Steering system: Rack and Pinion to make steering easy.
5. Brakes: Discs brakes have been used at all four wheels. Also, a vacuum assist is used on
all the brakes using the vacuum created in the engine.


Market Analysis:

Before we go into further details of our plan we need to know how much out of the total
production of ATV is in Asia and what market is there in India for NEMESIS. The market
survey is presented in the marketing plan that is separately attached.

Company Description
The company at the start will be a vertically integrated company. This will help the
company avoid hold-up problems, or to bargain profits . The goal will be getting established
in the market and subsequently expanding business, increasing liability in manufacturing
subsystems. Investment at the start will be less with the objective of maximizing company
profit. With strategies such as high quality, low cost and active customer involvement we
hope to make the products a success.
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Low competition in a high potential and developing market, a dedicated team of personnel,
high quality production with customer-friendly costs will be the primary success factors for
the company.

Execution Plan
The entire setup will be done in two phases:
 Phase I: During the initial 2 years after setup, we will have only one plant with roll cage
fabrication shop and assembly line. The plant will operate for one shift per day and six days
a week.
We will capture reasonable market of existing vehicle, which will help us create a Brand
name in the field of ATV and eventually increase our sales. There will be some service
centers to help customer, service their vehicle on regular basis
 Phase II: During the next 5 years, we will widen our scope by manufacturing few more
subsystems like critical steering and suspension parts in the manufacturing plant. The plant
will be operated in 2 shifts to fulfill the demand.

Plant Set-Up

The company will enter into the market with just one product i.e. NEMESIS. The plant will
be just an assembly plant with one fabrication shop mainly to fabricate roll cage
The company will have a plant as per the layout given below:

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The roll cage is completely ready when it comes out of paint shop. The painting is done with
active customer involvement allowing custom designs to be made on the body. It is then
transferred by transportation modes to assembly line where all systems are mounted on
roll cage. The assembly line has special rail track arrangement for assembly where roll cage
is mounted on moving pallet. This pallet stops at every station for mounting for various sub-
systems on roll cage to complete assembly operation. At the end the vehicle is unloaded
from pallet and sent to testing. The completely ready ATV is then sent to storage area.
The detail assembly process of vehicle is given in the fallowing way:


Prospective Financial Data:

IMPORTANT ASSUMPTIONS:
1. We assume an economic growth without major recession. Hence we assume a steady
annual increase of 6% in income.
2. Also, not assuming major inflation, expenses are predicted to increase at 5% per annum.
3. We assume that there are no unforeseen changes in technology to make products
immediately obsolete
4. We assume access to equity capital and financing sufficient to maintain our financial plan
as shown in the tables.
5. Credit limit allowed to debtors and creditors is 30 and 45 days resp.

Steeri
ng
colum
n with
rack-
n-
pinion
Brake,
accele
rator,
clutch
paddl
e
Engine
,
trans
missio
n
Suspe
nsion
Disk,
Knuckl
e and
wheel
assem
bly
Fuel
tank
Electri
cal
syste
m
parts
Seat
and
access
ories
Testin
g rig
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NET INVESTMENT:
PARTICULARS AMOUNTS(in lacs)
Cost of Land and Construction 70.00
Plants & Machinery 73.70
Installation 2.50
Working Capital 45.00
Preliminary & Pre-operative Expenses 3.00
Total Investment 194.20

PARTICULARS YEARS
I II III IV V
Revenue
Sales Revenue (Net) 3,074.11 3,967.46 4,508.56 5,100.32 6,642.48
Closing Stock (Finished
Goods)
422.27 477.49 537.17 601.63 789.64
Closing Stock (Raw Material) 247.26 279.59 314.54 352.28 462.37

Total (A) 3,743.64 4,724.53 5,360.27 6,054.24 7,894.49

Opening Stock (Finished
Goods)
- 422.27 477.49 537.17 601.63
Opening Stock (Raw
Material)
247.26 279.59 314.54 352.28
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Purchases 3,794.07 3,960.70 4,425.11 4,923.59 6,495.71
Direct Cost 42.18 47.70 53.66 60.10 78.88

Total (B) 3,836.25 4,677.92 5,235.85 5,835.40 7,528.51

Administrative Expenses
Salaries & Wages 39.06 58.59 87.89 131.83 197.74
Telephone Charges 0.40 0.60 0.90 1.35 2.03
Office Expenses 0.40 0.60 0.90 1.35 2.03
Power & Fuel 0.40 0.60 0.90 1.35 2.03
Stamp duty & Misc
Processing Charges Written
off
2.00 2.00 2.00 2.00 2.00
Repairs To Machinery 0.90 0.99 1.09 1.20 1.32
Insurance Expenses 0.75 0.64 0.54 0.46 0.39
Traveling Expenses 0.60 0.90 1.35 2.03 3.04
Printing & Stationery
Charges
0.50 0.75 1.13 1.69 2.53
Contingency & Misc Charges 1.00 1.59 2.37 3.53 5.28
Total (D) 46.01 67.26 99.06 146.78 218.37


Legal & Professional Fees

Audit Fees 0.50 0.55 0.61 0.67 0.73
Consultancy Charges 0.20 0.22 0.24 0.27 0.29
Total (E) 0.70 0.77 0.85 0.93 1.02


Sales Expenses

Selling & Distribution 0.50 0.59 0.70 0.82 1.13
Packing Charges 0.50 0.59 0.70 0.82 1.13
Total (F) 1.00 1.18 1.40 1.64 2.25

Bank Interest & Other 11.33 9.96 8.16 6.12 3.80
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Charges
Depreciation 11.21 9.53 8.11 6.90 5.87
Total (H) 22.53 19.49 16.27 13.02 9.67

Provision For income tax (55.36) (14.31) 2.33 19.19 45.77
Total (J) (55.36) (14.31) 2.33 19.19 45.77

Profit after tax(K) (107.50) (27.79) 4.52 37.27 88.89

Dividend - 8.29 8.29 8.29 8.29
DDT - 1.24 1.24 1.24 1.24

Amount Tr. To Retained
Earnings
(107.50) (37.32) (5.01) 27.74 79.36

Earning Per Share
Profit after Tax (107.50) (27.79) 4.52 37.27 88.89
Number of shares 8.29 8.29 8.29 8.29 8.29
Earning Per Share (12.97) (3.35) 0.55 4.50 10.73

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PROCESSING COST PER UNIT:
System COST
Engine & Transmission 72,677.47
Suspension 18,048.00
Brakes 11,408.00
Steering 6,372.00
Ergonomics 5,600.00
Roll Cage 10,848.00
Electronics 3,360.38
Other 800.00
Freight 800.00
Total Cost Of Production 129,913.85

BREAK-EVEN ANALYSIS:

Looking at the above graph we can say that the break-even of a company is after second
year and before third year.


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Organizational And Management Structure:

Ownership Information:
 The Company will be a General Partnership company.
 It will have 10 investors as partners and will have an equal 10% share in the company.
 The 10 partners/investors will have authorized common stocks of the company.
 They will form the main decision making and governing body.

Organizational Structure:
 A Managing director will be elected among the 10 partners unanimously.
 The M.D. will head the line of command. A total unity of command will be observed
throughout the company.
 The Company will follow a Balanced Matrix Management, where several employees can
work under different departments, according to their skills. This is to overcome the initial
lack of employees and to avoid over-employment and reduce salary costs.
 The company will be divided into various operational departments viz.
 Finance
 Marketing
 Sales And Distribution
 Research And Development
 Manufacturing
 Human Resources
The diagram given below shows the organizational structure that will be established.









Managing Director
Finance Marketing
Sales and
Distribution
Research and
Development
Manufacturing
Human
Resource
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MARKETING AND SALES MANAGEMENT
A detailed marketing strategy for the company with description of a planned market
penetration strategy, strategy for diversification has been separately provided in the
Marketing plan attached.


Sales Strategy:
 The Sales Team would comprise of employees specifically for sales and from other
departments as well (matrix management), which would help cut salary costs and avoid
over-employment in a new business. Subsequently, after the company is established,
recruitments in the sales team could be made separately.
 The company aims to use direct mail/internet catalogues and promotional efforts for
advertise and sales of the product.
 Sales force comprising of internal representatives will be responsible for sales to various
customers.
 The company will establish contacts with adventure groups, auto/rider/ biking clubs
throughout the country enabling business to business sales. This will not only help the
company establish direct relations with the target customers but will also help in
advertising our products in the specific market.
 The company will completely avoid retail markets where its initial lack of Brand value will
make it difficult to compete against well established products in the retail market.
 The company will have a regular competitor analysis to create dynamic sales plans.
 To prompt consumers to order direct, TEAM NEMESIS will accept orders on the Internet,
through web conferencing appointments with potential customers and via a toll-free 800
line.










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Product Line

 At first the company will launch only one product NEMESIS, a light-weight, simple,
economical and high performance ATV.
 Engineered for high torque high performance and easy riding, the product will give the
excitement the customer wants, yet not overlooking safety.
 People in India have to compromise with SUV or MUV in place of ATV. The vehicle will be a
solution for the people who need a flexible, high performance yet economic ATV for their
jaunt in the rugged and adventurous outdoors.
 The customers will benefit from the economic prices, good quality, high safety, high
performance products and an experienced line of engineers to service and provide
assistance in maintaining the vehicle.
 Launch of subsequent versions, once NEMESIS is established in the market, will give an
array of vehicles for the customer to choose from, based on performance as well as cost.
 The Company also plans to increase customer involvement in the manufacturing of the
vehicle, with the customer being able to choose between an array of engines, transmission
systems, safety equipments etc. resulting in a custom built car, as per the client’s
requirement.

Research And Development
 With extensive research and development, the company will endeavor to produce better
line of products with active involvement and feedback from customers.
 Innovative designs through R&D will help the company adapt to the changing demands of
the customers and will ensure that the company maintains its ground in the market.
 As the company understands its liability towards the environment, through R&D we also
plan to incorporate more environment friendly products and manufacturing techniques.







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Having looked at the entire analysis of the business plan we can draw the various points in
terms of a SWOT analysis. The SWOT analysis is very important with respect to the entire
business analysis as it summarizes entire analysis in the form of its gist and can give the
total details of it. Looking at the SWOT analysis the investor can easily see what the relative
returns in the business are.

The SWOT Analysis:



STRENGTHS WEAKNESS
1. Dedicated to ATV only.
2. Long list of customers.
3. Good returns over the period of time.
4. ROI (Return On Investment) &
ROTCE(Return on total capital
Employed) quite encouraging

1. The business operates on large sales
less margin principle.
2. Susceptible to variations in
commodity prices.
OPPORTUNITIES THREATS
1. The list of customer base increasing
in leaps and bounds.
2. Opportunity of increasing the
production facility.
3. Good chances of making brand value
as a vertical company in ATVs.
1. Lack of customer interest in
Product.








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Future Expansion Plans:
 Diversify into production of new varieties of ATVs.
 Introduce more environment friendly ATVs through R&D.
 Increase production to become a brand name in field of ATV.
 Make value addition in the manufacturing process itself to eliminate intermediaries.
 Set up similar plants all over India and become a global ATV manufacturer.


The Exit Strategy:
This strategy will be implemented in the worst case if we are facing immensely high losses
only.
 The existing machinery can be sold out at 30% lesser than its depreciated purchase
cost according to the company policy. This is one of the methods to recover some of
our investments.
 Another alternative is to sell out the entire plant to some ATV manufacturer.











References
1. www.adventurewheels.co.in
2. www.atvontario.com
3. www.india-atv.webs.com