de hat business plan

DE - HAT

Two-thirds of countries consumers live in rural areas and almost half of the national income is generated here.

Our nation is classified in around 450 districts, and approximately 630000 villages.

Middle and high-income households in rural India is expected to grow from 80 million to 111 million by 2008.

In urban India, the same is expected to grow from 46 million to 59 million.

The idea is to open a retail outlet in rural areas which are basically not surrounded by farms, and are in the centre of many villages.

The Indian rural market with its vast size and demand base offers a huge opportunity that MNCs cannot afford to ignore.

With 128 million households, the rural population is nearly three times the urban.

Large and Scattered market Major income from agriculture Low standard of living Traditional Outlook Diverse socio-economic backwardness:

The rural market accounts for half the total market for TV sets, fans, pressure

cookers, bicycles, washing soap, blades, tea, salt and toothpowder

The first challenge is to ensure availability of the product or service.

India's 627,000 villages are spread over 3.2 million sq km

Any serious marketer must strive to reach at least 13,113 villages with a

population of more than 5,000.

Study on buying behaviour of rural consumer indicates that the rural retailers

influences 35% of purchase occasions.

Place : Rajapur {Uttar Pradesh} Land : 1000 sq. ft. {owned} Capital Required: 20 lacs{inc. WC} Working Capital : 10 lacs People required: 7

FMCG products White goods Apparels Bikes Tractors Insurance seeds

Floor manager : 1 Product demonstrator : 6 SALARY

Floor manager :8,000 Product demonstrator :4,000

So the total salaries given is 8,000 + 24,000. = 32,000

Mall will be open from 5 am to 10 pm. It will sells everything that a rural consumer may ask for. Banking and automated teller machines will be standard at the

malls. Insurance products for farmers. Entertainment facilities, restaurants, public facilities and parking

space will also be available. Parking lot for 160 tractors.

Primary healthcare facility Information centres They can log on internet and check the pricing and sell

their commodities. Godowns facilities

Radio advertising News papers. Pamphlet distribution Word of mouth publicity Special offers

Advertising cost : 1 lakhs

The future plan of the DE – HAT is to open more number of stores in the same type of areas as the first one.

Gradually increase the value of the brand, enter the semi urban areas.

Giving the customers the great service and good quality products and different brands

To make DE – HAT a national brand.

Chaupal Sagar is one of the first organised retail forays into the hinterland.

It is actually a warehouse for storing the farm produce that ITC buys through its e-chaupals.

The mall has come up in one part of this warehouse.It has been set up by the international business division of tobacco major ITC.

It has been initiated as rural shopping-cum-information centres in Madhya Pradesh.

ITC Spent 3 years and Rs.80 crores on research and development of this concept including investments in E-choupal

Special offers Appropriate pricing Good atmosphere All services under the roof Product demonstrators Good quality product Proper service

Since it is a retail outlet so there will be muti brands available in the outlet so the products will be purchased in bulk and the per product price will come down and hence the customer will be able to purchase it at a relativly cheaper price

Fixed cost Building : 5,00,000 Land: owned Other equipments: 5,00,000

Variable cost Salaries : 3,84,000 Advertising : 1,00,000 Products: 5,00,000 Misc.: 16,000

If some how the business does not do well which is a remote possibility, because a lot of research will be done before starting up the store.

Even then if the store does not does well. We’ll have a big hall which can be divided into many small shops and then it can be sold to different purcahsers