Business plan for selling mobile accessories

Project Summary

The goal of the project is to create a micro-enterprise in Krasnodar. Field of activity - sale of accessories for mobile phones on the "island" in a large shopping center. The project initiator is assumed to be self-employed.

The demand for the project's goods is due to the general situation in the mobile retail market: a decrease in the solvency of the population, which led to a decrease in demand for new mobile phones and smartphones. This, in turn, is fueling demand for mobile device repair services, as well as accessories that can be used to personalize a device or protect it from wear and tear.

Investment costs are aimed at paying a rental deposit for three months, manufacturing a trading stand, purchasing goods, as well as forming a working capital fund until the project reaches payback.

Table 1. Key performance indicators of the project

Description of the company and industry

One of the most striking indicators of consumer sentiment in Russia today is the market for mobile devices - smartphones and tablets. In a stable economic situation, many Russians preferred to change their smartphone on average once every one and a half to two years. In the last two years, the situation has changed dramatically.

Focusing on the indicators of the Opora RSBI Index compiled by Opora Rossii jointly with Promsvyazbank, business sentiment in Russia stopped falling and showed a slight upward trend.

Figure 1. RSBI indicators, 2014-2016

However, mobile retail (b2c-market of mobile devices) indicates a more serious drop in consumer sentiment. For example, in 2015 the main market trends were:

• a decrease in the share of the premium segment in total sales against the backdrop of growing popularity of new (largely Chinese) brands; at the same time, consumers preferred to maintain the performance of devices, but not overpay for the brand; the share of traditional smartphone manufacturers fell to less than 50% of total sales
• growth in the average retail price of devices - according to experts, it increased by 9% compared to 2014; at the same time, growth was significantly lower than in other segments of the home appliances and electronics market
• growth in smartphone functionality - the share of devices supporting LTE, NFC, two SIM cards, etc. has increased.
• replacement by smartphones of conventional mobile phones, which as of 2005 accounted for 33% of total sales

It was in 2015 that the mobile device market in Russia showed negative dynamics for the first time since 2009: compared to 2014, sales decreased by 3% in real terms. Sales of smartphones increased due to a decrease in sales of conventional mobile phones - smartphones, according to the TrendForce analytical agency, sold 22% more than in 2014 (in monetary terms).

At the beginning of 2016, several major players in the mobile retail market at once reported a serious drop in sales in physical terms - by 8.4% in 2015 compared to 2014. Revenue, however, continued to grow due to the growth in the cost of devices. The average cost rose from 8.9 thousand rubles per device in 2014 to 10.1 thousand rubles. in 2015. The share of smartphones with LTE support accounted for about 57% of sales in real terms.

At the beginning of September, 2016 the analytical company IDC published preliminary results of the Russian market of mobile devices for the first half of the year 2016. Experts note the stabilization of indicators and a return to pre-crisis levels. However, according to IDC forecasts, in dollar terms, the market will not regain its former positions. In the medium term, the market will remain highly competitive and price sensitive.

The main market trends in 2016 include:

• continued growth of interest in the functionality of devices (performance, LTE support, photo and video quality, etc.)
• consumers have become less likely to change mobile phones (the share of devices purchased more than 12 months ago has increased significantly)
• growth in sales of mono-brand chains, decline in sales of multi-brand chains; the retail of mobile network operators is also growing (in the first half of 2015, mobile devices were purchased from operators by 21% of buyers, in 2016 - 24%)
• growth in sales of devices under the own brands of mobile operators; as a rule, these are budget devices made in China

Figure 2. How long ago did you buy the mobile phone/smartphone you use today (according to AC&M)

Figure 3. Structure of sales of mobile devices (according to AC&M)

Summing up, we can say that in the next few years the market is most likely to be in a state of stagnation. The share of multi-brand retail will continue to decline, but it will not completely disappear. The importance of own distribution channels of mobile operators will grow.

These data show a decrease in demand for new mobile electronics, which leads to an increase in demand for spare parts and accessories. Thanks to accessories, you can “revive” the look of even a significantly shabby smartphone, as well as extend its life.

The enterprise is organized "from scratch", registered in the relevant state structures. Placement of a retail outlet - an "island" in the largest shopping center in Krasnodar. The island refers to a retail outlet with an area of ​​2.5 m 2 in the gallery of the shopping center. The project initiator is assumed to be self-employed.

Krasnodar is a city in the South of Russia, the administrative center of the Krasnodar Territory, one of the largest cities in the Southern Federal District. A major economic, commercial, industrial and cultural center. The population of the city is 853 thousand people.

The largest shopping center of the city was chosen for placement, the total area of ​​the center is 180,400 m 2 , the trading area is 142,000 m 2 ; parking for 3,500 cars. On the territory of the shopping center there are: the largest grocery hypermarket in the Southern Federal District, a building materials hypermarket, a furniture store, goods for sports and recreation, household appliances and electronics, clothes and shoes for children and adults, a bowling alley.

The outlet is located in a place with the highest traffic, in one of the central galleries of the shopping center, in close proximity to the food court.

Description of goods and services

The project sells accessories for mobile phones and smartphones of the budget and medium price segments, mainly of Chinese and Russian production. These include both decorative elements (back covers), and functional ones (chargers, portable speakers) and protective ones (protective films, covers). The full list of products (by category) is given in Table. 2. In order to simplify the calculations, the average cost of goods in each category is used.

Table 2. Assortment, variable costs and selling price

Project workers also provide services for sticking a protective film, installing back covers, setting up speakers, and so on. All services are provided free of charge.

Goods are purchased at the wholesale warehouse of a large network wholesale supplier of mobile accessories. The warehouse is located in Krasnodar, which greatly facilitates logistics and reduces the cost of delivery of goods.

Sales and marketing

The target audience of the project is men and women aged 14 to 45 who have a mobile phone or smartphone, with an income of up to 50,000 rubles. All sales are carried out directly through the point of sale in the shopping center. To attract customers, a specially organized display of goods is used, demonstrating the most striking and original accessories. In addition, demonstrations of goods are periodically held - for example, the operation of portable speakers.

Additional promotion is carried out through social networks and Internet services aimed at the youth audience, which is the most active segment of the target audience. The social networks ok.ru, vk.com and the Instagram service are used. Public pages are created, filled with various content:

• useful - tips and tricks for the use of mobile phones and accessories, for their care (40% of the volume)
• advertising - information about new products, discounts and promotions (20% of the volume)
• entertaining - funny stories and pictures related to the theme of the pages (25% of the volume)
• involving - contests, surveys (15% of the volume)

Publication frequency - 3-4 posts per day.

The competitiveness of the project is based on its favorable location. There are digital equipment stores on the territory of the shopping center, which also offer accessories for mobile phones and smartphones, however, since this area is not their specialization, their assortment, as a rule, is not so deep. Typically, mobile retail store inventory consists of accessories for the latest device models that are directly on sale. Given the fact that the stock of mobile devices in the country is rapidly aging, accessories for older models are becoming in demand. The project takes this fact into account and pays attention to the purchase of such accessories, which has a positive effect on the profitability of the project, since obsolete models are purchased from stock balances of wholesale suppliers at a discount.

Reaching the planned sales volumes - presumably from the fourth month of the project implementation. Break-even point reached by the third month of project implementation. Demand for the project's products does not have a pronounced seasonality, with the exception of bursts of consumer activity in the pre-holiday periods - before February 23, March 8 and the New Year.

Table 3. Planned sales volumes

Production plan

The sale of goods is carried out through a trade stand located in the gallery of the shopping center. Stand area - 2.5 m2. The operational stock of goods is stored inside the stand, in lockable boxes. The premises of the shopping center are guarded centrally, so overnight storage of goods at the stand is safe. The main commodity stock is at the initiator of the project, for which a special room is equipped in his house.

The trade stand is made by the furniture enterprise in Krasnodar to order according to individually developed drawings. The design provides the most convenient open display that can attract the attention of visitors to the shopping center. The term of manufacture and installation of the stand (by the manufacturer) is 7 calendar days.

The purchase of goods is carried out at the warehouse of a large wholesale supplier of mobile accessories. Depending on the volume of a one-time purchase, the size of the wholesale discount usually varies, however, the project initiator managed to reach an agreement with the regional management on fixing the maximum discount, subject to a gross monthly purchase volume of at least 150,000 rubles. The planned volume of purchases (according to Table 3 - 171,200 rubles).

The warehouse turnover is planned at the level of 2-2.5 times a month, thus, 2-3 purchases of goods for a different amount are made monthly. This allows you to more accurately form a warehouse stock, avoid the appearance of illiquid goods, and also increase the turnover of working capital.

The product is delivered in its original packaging. The warranty period depends on the product category.

organizational plan

All management and management functions are performed by the project initiator. He has experience in organizing retail trade and promotion on the Internet. Accounting outsourced. Opening hours of the outlet - 10.00 - 22.00. A shift work schedule is provided - 2/2, respectively, a second seller is required. The selection of the seller is carried out during the preparatory phase of the project. The duration of the preparatory stage is 1 week. During this period, the production and installation of a trading stand is also carried out, the purchase of the first batch of goods is carried out. After that, the operating period of the enterprise begins.

The project has a limited implementation period - five years, after which it is planned to be liquidated with the sale of assets and profit fixation. The basis for such a decision is the unpredictability of the development of mobile technologies and the economic situation in the country.

IP was chosen as the organizational and legal form. Form of taxation - Unified tax on imputed income, section 8 "Retail trade carried out through the objects of a stationary trading network that does not have trading floors, as well as through objects of a non-stationary trading network, the area of ​​\u200b\u200bthe trading place in which does not exceed 5 sq.m."

Table 4. Staffing and payroll

Financial plan

The financial plan is drawn up for the entire duration of the project and takes into account all the income and expenses of the project. Income refers to revenue from operating activities; other types of income are not provided for by the project. Annual revenue after the project reaches the planned sales volumes - 3.3 million rubles; net profit (after taxes) - 299 thousand rubles.

Investment costs - 309,000 rubles, of which the project initiator's own funds - 100,000 rubles (Table 5). The lack of funds is expected to be covered by attracting a bank loan for a period of 24 months at 18% per annum. Loan repayment is carried out by annuity payments, credit holidays - three months.

Table 5. Investment costs

Variable costs include the cost of purchasing goods (including the cost of transportation to the project warehouse) and are shown in Table. 2. Fixed costs include the cost of renting space, advertising and depreciation. The amount of depreciation is calculated using the straight-line method based on the useful life of property, plant and equipment of five years. At the end of the project, fixed assets are to be written off.

Table 6. Fixed costs

A detailed financial plan is given in App. 1.

Efficiency mark

Evaluation of the effectiveness and investment attractiveness of the project is based on the analysis of the financial plan, cash flows, as well as simple and integral performance indicators (Table 1). To account for the change in the value of money over time, the discounted cash flow method is used. Discount rate - 3%.

Simple (PP) and discounted (DPP) payback period - 16 months. Net present value (NPV) - RUB 450,964 Internal rate of return (IRR) - 7.1%. Profitability index (PI) - 1.46. These figures are quite high at a low discount rate. If we take the discount rate as the desired rate of return of the project initiator, the project can be considered effective and attractive to the investor.

Guarantees and risks

To assess the risks associated with the implementation of the project, internal and external factors of influence are evaluated. Incorrectly selected assortment can be attributed to internal factors. To neutralize this risk, the following measures should be taken:

• monitoring of warehouse balances for turnover and liquidity
• monitoring feedback and survey results on pages in social networks
• competitor assortment monitoring
• obtaining data on the most demanded goods from the project supplier

External factors include the following:

• rent increase
• decrease in effective demand

In the event of any of the listed negative scenarios, it is necessary to fix the profit and liquidate the project due to the inability to compensate for the increase in costs due to the profitability of the project.

Applications

Financial plan