Business Plan - E-knowledge

Business Plan E-Knowledge Lanka (Pvt) Ltd “New Wave to Sri Lankan learning Community”

Date – 21st April 2008

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Table of Contents 1.0 Executive Summary 1.1 Overview of the Market 1.2 Technical and key personnel 1.3 Financial Overview 2.0 Detailed Business plan 2.1 Industry Analysis 2.2 The future success 2.3 Back Ground of the Business 2.4 The functional areas of the business 2.5 Sources of competitive advantage of the business 3.0 Marketing Plan 3.1 Market Analysis 4.0 Pricing Strategy 5.0 Advertising and promotional strategy 5.1 Advertising 5.1.1 Offline 5.1.2 Online 5.2 Personal selling 5.3 Predicted Media Cost 6.0 Service Strategy 6.1 Advisory services 6.2 Orientation Program 6.3 E-Learning materials 6.4 Online seminars 6.5 Advertising from institutions 7.0 External Market Influences 7.1 Technology and the Business 8.0 Competitors 9.0 Strategic analysis 9.1 SWOT for the Business 9.2 Segmentation Targeting and Positioning 10.0 Operational Plan 10.1 Daily Operations 10.2 Location 10.3 Management and Organization 10.4 Personnel 10.5 Structure of the Organization 11.0 Financial Plan 11.1 Income and Expense forecast for 3 years 11.2 Balance Sheet Forecast for 3 years 11.3 Cash Flow Forecast for 3 years Our Team

2 2 2 3 4 5 6 6 9 11 11 13 15 15 15 15 16 16 17 17 18 18 19 19 19 19 20 20 21 21 22 22 23 23 24 25 26 27 28 29 Appendix-1

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1.0 Executive Summary The business “e-Knowledge Lanka” will help those who are interested in obtaining knowledge in Sri Lanka. The business could be based on online and offline but most of the functional

areas

contain online business. The web domain would be

www.eknowledge.lk.

The business is totally focused on Sri Lankan Education industry. This is both free and paid service for the students. The E-Knowledge will help Sri Lankan institutions to promote them. This business can be divided into two major areas such as education and other related services through online and offline. The business consists of approximately 80% online and 20% offline activities.

1.1 Overview of the Market The Sri Lankan education industry is a fast growing field. At present all are aware about the value of solid education. There are institutes and individual persons who offer education service for the people. But they fail to maintain the quality at a certain level. They only focus on making profit or money. But if the market can be studied well and provide valuable services to the students this will bring a better prestige and help the organization to make money as well. Also the market consists of separate players egtuitions, higher education institutes but the market doesn’t carry any of the players who concentrate at a wide range of services through virtual world. The market has a better potential because in future we are going to live in a virtual world. All the activities will be undertaken through virtual life.

The business strategic actions which will take the business to success are totally the effort made on branding. Also the strategic decisions made on the following areas such as marketing mix, segmentation targeting and positioning should be the key factors to achieve a successful business. There are web sites in Sri Lanka with good contents and

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information, but they are not successful due to lack of concentration on branding and promotions. 1.2 Technical and key personnel In this business there are more managerial key players. The marketing manager should focus on capturing the market. The technical manager is responsible to look at the technical stuffs such as data bases, site functionality. There should be a manager for accounts and finance. The key personnel chart could be as follows;

Post

Areas to looked at

Directors

Monitoring all the business area

Manager – Marketing

Getting clients, students, career guidance offers, advertisement etc

Manager – Web site

Designing, developing, checking the site

Manager- Accounts and Finance

Responsible for the cash flow

Manager – Technical

Date base, proper development and site functional

Panel of Professionals

Handle all kind of educational activities- contract basic

1.3 Financial Overview This is a medium scale business that requires 6 million initial starts up cost. Since this is highly depend on the technological aspect we have to invest much on computer equipment and accessories We assumed/hoped this 6 million amount of capital can be raised through the issue of shares among individual or through the investment of a highly established organization. This capital requirement could be attained by the way of Bank loan too, but we have not considered that option in our evaluation. If we have successfully broadened the business in the first year we could expect a 15 % and 20% growth in the first and second year respectively. This could lead the organization to manage the cash –flow in an efficient manner and offer a better return on the capital invested.

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Detailed Business plan 2.1 Industry Analysis Sri Lankan education sector can be divided into the following categories.


Primary Education




Secondary education




High School




Professional Education




Degree Programs (Local and foreign)




MBA




PHD

The sector consists of following activities. Primary education will be from year 1-5. Secondary education starts from year 6 to Ordinary level and the high school represent Advance level in Sri Lanka. The above mentioned are based on local education system, if we consider the international system the same can be applied but the way of teaching could be different. The scopes on the primary and secondary education are low for the local education system. But for International schools the size of segments are low but can be targeted well.

Both International and local higher school studies can be considered as a good target because those are the stages people look for better potential advices to grow. The student will be happy if they can get good guidance from a recognized professor or lecturer.

Then the next could be the professional education sector such as CIM.CIMA, ACCA. Etc. The graduate schools contain of local and foreign universities and also the MBA programs. At present the 0rganisations focus on the training and development at the working point. Also apart from education the sector has a demand for better student consultant and advisers the education related career guidance also comes to play a major role.

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The trend is always growing. These days’ people know the value of education. Education and other related fields are growing. The education level of women had increased. People live in rural areas are more concerned on education these days. Number of tutorials are increasing, the level of personal classes growing, the professional education field increases. Students are seeking for knowledge and guidance. So the industry always shows a good growth rate.

There are firms who carry orientation, training and development program for their employees. Most of the Sri Lankan organizations realize the value of knowledge management and learning culture.

2.2 The future success. Currently Sri Lankan online market doesn’t show a better growth rate but in future it will .People are going to live in a virtual life. This is already adopted in foreign countries but in Sri Lanka it is still growing. In future the knowledge seeking will happen online in Sri Lanka. These days people more aware about online studies. The organizations are started to practice e-learning. In future the trend for the following will definitely take place. Internet penetration in Sri Lanka is increasing and most of the Internet service providers target with more broadband facilities. So home connection will grow in future, which will make a good path to the virtual businesses.

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2.3 Back Ground of the Business Mission Statement of the business “To be the prominent virtual organization to add value to all learning citizen”

Goals and objectives of the business Goals •

To position ourselves as a number one e learning provider in Sri Lanka

•

Connecting all the people who seek for knowledge and guidance

•

Building a strong e-learning community in Sri Lanka

Objectives •

Getting at least 200,000 people to use our service

•

Capture minimum number of 100 organizations in Sri Lanka as our clients in T&D, orientation programs

•

Set up our unit in Sri Lankan schools - 50 local and 10 international schools

2.4 The functional areas of the business The functional areas of the business can be the followings

1- Student advisory services Through online students can request for advices from the professionals employed by us. The advisory services can be divided in to the following areas such as school level, Graduate schools and others. Students those who are facing difficulties in their education can request for guidance through our web. They can book a time when they need the service. Using online teleconferencing method they can talk to our expertise. If the students need to get common guidance can go through and frequently asked questions. Also every week there will be online

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seminars for students which they can watch and listen live or can watch the recorded version. Eg- If a student who completes A/Ls and looks for a better guidance for his/her future then through our web he need to select the adviser he preferred and select the area of advice and then book a time. If more students prefer to book a particular adviser, the interested parties could be placed on one category for the advice teleconferencing.

At this service level we need to assure the quality and the education of the advisor.

As part of an offline strategy we can make our guidance unit separately in every school. For schools the service could be free of charge based on the sponsorship we collect. Using this offline strategy we can target rural areas as well.

Also people who look for professional’s advices can be given like how to face and interview, brain storming session, selecting your future career, the better education you can follow etc. we can Offer the viewers a maximum number of articles to go through. If it’s a better article which has more value the member could create online membership system to read it. Eg- Those who get a premium membership can have unlimited access to e-education resources.

2- Online seminars. At present Sri Lankans are less aware about online seminars. But in future the need for online seminars is going to be increased. Using expertise we can undertake online seminars and charge the people who view it. The membership might be premium, normal. Those who get premium membership can access online seminars unlimited.

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This can be targeted for International school students as well. They are well aware about internet study. Using contracts with International schools the teachers can recommend us as a learning tool for their study. Example if a London O/L comes we can arrange online seminars for the students who take exam at that time. Or else there is another way to conduct this seminar Eg- Arranging an online seminar in a school hall which will enable the students to hear and see our expertise who is conducting the seminar. Also the students can use our technology and raise questions and obtained the answers for same from the expertise.

3- Orientation program Organization can create their profile with us. If they need us to make orientation program for them we can make the arrangements. Using the personalized areas pages they can request for orientation and training programs for their employees. The orientation can be done by our expertise in whichever field requested by them.. For this we should have the base of all professionals in Sri Lanka. Even if any universities wish to arrange orientation program for the new intakes, this could be organized by us.

4- Foreign Contacts We can make agreement with foreign universities in order to give more opportunities for the Sri Lankan students. By using organization sponsorship we can send the top Sri Lankan students to the foreign universities. Eg- Top university student. Also for students who wish to follow foreign education can contact us regarding the courses. A separate consultancy can be done for them. We should include all the foreign university bases in our date base. So we can provide people valuable information.

5- Study articles and e-resources for students. We can publish Sri Lankan books, articles, research papers, news and other educational stuffs for viewers. Eg- Like emeraldinsights.com, marketingprof.com

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etc. We can publish articles on current market trends and the education trends in the web site.

6- Advertising Sri Lankan institutions who want to advertise with us can do so. They can advertise the courses they provide and a completed profile about them. Students who seek for education can go through the details from our web and apply or contact through online. An online customer care executive can answer questions from the viewers through chat system or by requested call number. Even if we are on offline the viewer can leave messages to take a call back for them.

2.5 Sources of competitive advantage of the business In Sri Lanka there is no business exist which targets Education sector. The sources of competitive advantage of the business are 1- Professionals we contact (University Professors & lecturers, Industry experts, consultants etc) we should try to capture all the well known professionals in Sri Lanka. 2- The high technical website connected with data base 3- Service excellence 4- Search Engine Optimization 5- First business in Sri Lanka.

The service is totally giving high value to the users. The service should be in high quality and should keep up the time. The ways in which the business create values are •

More feature in the web site. Eg- Online customer care, good site functionality, quick loading and downloading

•

High Security online payment system.

•

As a virtual business there will be continuous innovation which increases the customer value.

•

Promised service on promised time.

•

Increase the possibility of e learning in Sri Lankan students.

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•

Create an edge in organizational level training and development.

•

User preferred methods of services

The business is depending on more factors to get it in the success point. The major factors which will make the business success are •

Attractive professionals web site

•

Recognized individuals ( Professors, lecturers etc)

•

Technology (Database, tracking, etc)

•

The price we charge

•

The service quality

•

The marketing communication

When taking the key success factors generally the product web site play a major role. The web should load quickly; the viewer’s should be able to access the web very easy, trusted purchase, quick downloading and the physical appearance of the web. The service is again depending on the professionals we have. The people like professionals, university lecturers, experienced industrialists etc. Also the proper internet development is important for the business success for tracking the details of visitors, sales, visitors’ segmentation etc.

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3.0 Marketing Plan 3.1 Market Analysis The business marketing can be divided into two. One is individual marketing and the other organization marketing. The target market is shown in the following diagram.

e-knowledge.lk

Individual

1- Students ( O/L, A/L both local and international) 2- School leavers 3- Undergraduates 4- Graduates 5- MBA followers 6- PHD Education Seekers 7- Foreigners

Organization

1 – Organizations (Those who concentrate high on employee training and development) 2- Firms seek for orientation program 3- Schools (International) 4- Universities

The market contains all categories of students in Sri Lanka.

If we take the students market, special target would be the people who complete O/L and A/L. The scope of targeting less than the above grade is low because the need for 3rd party guidance is low. The parents provide the fullest support for their children. Student consultancy is very important in the age mentioned above. Because sometimes student do not express their problem and questions to their parents freely and this is the age most of the students struggle themselves. The principle is the same for both local and international students. At these level students who seek for online material is less except in an International school. 12

Also when ever people complete their A/L definitely they look for better guidance. The value of guidance is very high if it has been given by a talented and recognized advisor. The increased concern on education creates demand for better education consultancy and advisory service. The scope exists for online because the professionals will not be able to visit the particular school during their busy schedule. But if the student books the service on online he/she can view it through online in the night as well. The professional we recruit may give the guidance by staying at home.

Also if we take the school leaver market the chances of targets are high. There are people who struggle to take a decision on their professional studies, some look for work advices, some people seek for foreign chances, and some are undecided what to do. What ever the education even it’s local or foreign definitely people look for their future guidance. This level market contains the activities like looking for foreign universities, works, professional courses etc.

Undergraduate market contains greater opportunity for us.

They are the highest

information seekers. The number of Sri Lankan webs who provide information related to Sri Lanka is very low. Also undergraduate greatly look for career guidance in most of the instances. The online seminars will be very useful for them. The seminars can be conducted in all the education area. They also can be targeted with job opportunities based on our client base.

Graduates are people who seek for MBA programs and future career guidance. Most of the graduates those who just passed the universities generally look for better advice and consultancy. Because they are not sure which filed of work they have to actually target.

MBA and PHD followers are small target but they can also be attracted with research papers. They can upload their researches and other stuffs to their member page. If they want to levy a charge for their papers, this can be done. A charge could be levied from the viewers and this amount could be remitted to the owner of the article.

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If you take the business sector the opportunity lies in the training program level. At present most of the organizations highly concern on giving training for their employees. These training programmes could be arranged by us at the request of the employers and a charge could be levied for this service.. This is a kind of Offline activity. But all the contacts will be done through online. At the final confirmation the representatives will visit the organization and make further arrangements. (Foreign Contact)

There are universities who seek for student orientation but lack in arranging suitable person. Like an intermediary we can connect them with our top professionals.

4.0 Pricing Strategy

Advisory Service

Charges

Primary Education Local Schools

1500Rs

International Schools

3000Rs

Secondary Education Local Education

1500Rs

International Schools

3000Rs

Higher Education Local Education

2000Rs

International Schools

4000Rs 5000Rs

School Leavers Undergraduate Local University

8000 Rs

Foreign University(

12000 Rs

Situated in Sri Lanka) Graduates and MBA seekers

15000Rs

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Advertising

Charges

Banner in Our web site

5000 Per Month

Business Profile – If it has a profit focus

100,000 Rs Per Semi

Sponsorship

Vary

Sub Domain

10000 Per Month

Links

3000 Per Month

Online Seminars

Charges ( annually)

Premium Membership

20,000 Rs

Platinum Membership

10,000 Rs

Silver Membership

8,000 Rs

Orientation Program

Charges ( Per Program)

Full Service

200,000Rs

Half Service

100,000 Rs

University services – Local

20,000 Rs

Foreign

50,000 Rs

Articles Access

Charges

Premium Membership

20,000 Rs Per year- Unlimited access

Month Membership

2000 Per Month – Limited access

Foreign Education Guidance

Charges

Full Service- With Registration

Based on the total cost

Consultancy Services

25,000 Rs

Note- the price mentioned here might depend on the individual or professional as well. The quality, the education level also play a role when determining the price.

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5.0 Advertising and promotional strategy This can include both above and below the line strategy. The promotional mix could contain both online and offline activities.

5.1 Advertising – 5.1.1 Offline News Paper advertisements can be published. The print media should be targeted with all the with education section, business sections etc. The print media advertising could be targeted with the followings publications such as The business weeks, LMD, university publications, newspapers education weekly attachments, Organizational publications etc. Also when targeting the firms with advertising program we can publish our leaflets in their notice board. Street bill boards and banners near our targets can be hanged.

5.1.2 Online In Sri Lanka search for education materials and related stuffs are high. So we can run PPC campaigns in Google, Yahoo and MSN. When ever a search comes based on Sri Lankan education or topics we can be display our web in the top result. Also in the online PPC advertising bidding is generally low. With reasonable bidding we can come up in the position. Eg- 0.8 $ per click. If it costs more for us can adopt to pay per click action and we have to pay for the Google or Yahoo if there is any action happen in our web site. The targeted key words could be Sri Lankan education, education Sri Lanka, education in Sri Lanka and all the words related to education. Our results can be displayed when some one makes search regarding Sri Lankan education and learning.

Sri Lanka is in a boom in the social networking sites. People regularly go for Facebook and other social Medias. We can send Facebook flyers to capture Sri Lankans, which we have to pay when an action happen in our web. When targeting we have to make sure that we set the flyers to people who belongs to Sri Lanka network.

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There are Sri Lankan direct marketing companies with email addresses of Sri Lankan professionals, lecturers and students.. We can send direct mails informing them about our service. Eg- Inotrend International contains 70,000 emails in their base. Once we develop our customer base we can send the promotional mail through our technical stream.

5.2 Personal selling We can send our representative to Sri Lankan schools (both local and international), Universities (Private and government), firms (multinationals and larger firms specially) and canvas about our service and the web site.

As a public relations activity in the initial stage we need to publish our web and service launch in the news papers and online press Medias, which will create awareness about our brand at the initial stage. Also as a promotional strategy we can concentrate on Search Engine Optimization as well, which will get us in the first result (Organic Position). So in future we can be able to save our cost. The web site can be optimized to search engine friendly. So who ever search any education key words, our web results will appear in the first ten lists.

5.3 Predicted media cost Advertising

Cost for first year

Ad words (google, yahoo,

1,000 $ yearly budget – Spend based

MSN)

on clicks

News papers

1,000,000

Print Media

500,000

Search Engine Optimization

200,000

Public Relations

50,000

Direct Mails

50,000

Face Book Flyers

500$ per Year – Spend based on clicks

Magazines

200,000

Banners

30,000

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6.0 Service Strategy 6.1 Advisory services To get an expert advice the student should get register with www. eknowledge.lk. Once they get registered then there will be a personalized page created for them. After that they can be able to select their services they need. If a student wants to get advices regarding careers he can select the desired advisor and first make the payment. Then can select the desired date for the advice. Those who don’t have video cam at home and to get the online advice, can access it through the web site video cam which is connected to our own server.

If the student wants to access the online seminars then can access it by logging in. But except advisory services if the student wants to download papers, view online seminars the membership services can be applicable. The member should pay a premium membership and access all the material of eknowledge.lk also there will be free articles, download and seminars which can be accessed too. This is depending on the importance and the copy rights.

Also we have to get links from foreign universities and colleges. Students those who are seeking foreign education can access all the relevant information about foreign universities and colleges. They can apply through us. For this we have to get connected with foreign universities and colleges.

Eg- If an International school student need to get an advice from a well known professional then he need to login to our web site. Using the profile section can select the desired person from who he would like to get the advice. Then select the time and date and make the payment, which will automatically notify to the professional. Then the student can contact him at the selected date and communicate with video conference system. For this if the student has a web cam can communicate by looking face to face. If not he/she can only see the professional in the set up video stream. For this we have to set up technology at every professionals house we make contract. Also most of the Sri

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Lankan top professionals are available during the night. So he can make available at their desired time. If the students do not have internet facility at home then he can make the appointment at our office and meet him personally or directly. This might be the option for the time being.

The service can be applicable for all individuals who seek for advice related to education.

6.2 Orientation Program Generally this is an offline activity. If any organization needs to arrange an orientation program for their employees they can send the request to us through the web. They can create a business page in the web and send a request to us. All the arrangements will be done by us including arranging the experts, program arrangements etc. Apart from orientation if the organization needs to get training and development services all the services will be arranged with greater service excellence. We can take the responsibility from the start to end of the Training and development program.

There are universities in Sri Lanka arranging various kinds of orientation program for their new comers and students. This can be arranged by us. The orientation will be provided by our professionals. They may be industrial experts or the education expert.

6.3 E-Learning Materials We can upload enough e resources to student to improve their learning. But if it’s a premium article like research papers and publication by top professionals then the viewer need to pay for it. It depends on the article they select. They can be able to view the unlimited article in our web site by paying a premium membership. We can take the responsibility through the online credit card system, But for the time being they can make the payment to our branch as well. Also if a person need to view a research paper uploaded by the professional then he has to pay for him through us. The learning materials will contain all the resources. The articles could be based on areas such as Commerce, Science, technology, arts, economics, marketing, accounting etc. If a Sri Lankan professional need to publish his/her finding to all then he/she need to create a

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personal profile and can upload all the materials through our web site. If she/ he think that it has to be paid for viewing, then the viewer need to pay.

6.4 Online seminars We can publish online seminars for the people. We will be notifying the seminar time in the web. If the organization or individual need to access it can go online and listen to it live. Or else they can view the recorded version. For this they will be charged. Eg- Marketingprofs.com, seochat.com

6.5 Advertising from institutions Sri Lankan education institution can make advertisement with us. If they have courses and degrees to promote they can create their profiles in our webs site and promote their services. For this they have to pay us as advertisement charge.

7.0 External Market Influences There are external market influences for this business which can be classified in to the followings. They are Economic, social and technological The impact of economic factors may not influence much on us. When it comes to education these days people are willing to spend if it has a good value. They spending rate will be higher in future. Social market might influence us in more ways such as attitude towards online purchase, their income, and willingness to spend time on internet related education. But here also if the business can provide a better value for them then influence might not impact much on us. Technology is our heart of business. So when ever the technology changes we need to adapt our selves. Example – hosting servers, change in video stream communication, data bases (Data mining) integration of new operating system, updating technical personal etc.

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7.1 Technology and the Business Since our business is highly depend on the virtual operation we have to give more attention to the technical advancement. The technology we use should be updated and capable enough to attract our customer base. To make our promises true, we should have to use the effective Unix system technology. We propose to use a mix of Html, Java Script, MySQL and PHP language to design the website and the related functions to cater the all kind of customer expectations. In order to facilitate our learning citizens in the way of audio/ video communication format, we have to use Flash Streaming technology. Apart from that we have to maintain large databases and CGI’s in prominent manner to fulfill the database marketing needs and advantages. Our attention towards technology is high in rapidly changing technological environment.

8.0 Competitors As a first business still no direct competitors exist for the business and there is no strong brand names related to e learning in Sri Lanka. Also private institutions, personal consultant for students can be the other part of competitors. But these cannot be a threat when we attract high professionals for our business.

9.0 Strategic analysis The strategy could be focused strategy because we target the particular industry which comes under learning industry. In Sri Lanka the industry has sufficient market size and growth rate and no existence of competitors. Once we build up the business we can go for market development by using our current portfolio and target other geographic countries which have high demand for Sri Lankan professionals. Eg- India We can focus the market with differentiation in services we provide and get the first mover advantage. But anyway this business can be copied by others but the branding we do will make success for us in future.

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9.1 SWOT for the Business Strength of the business 1- Expert Professionals 2- Technology enabled 3- Learning resource databases. Opportunities 1- Increasing internet penetration will tend to grow 2- Awareness of education increases 3- Increase number of Foreign education seekers 4- Organization needs on T&D increases 5- The search on Internet

9.2 Segmentation Targeting and Positioning Segment is based on the variable mentioned above on the customers. The segments could be 1 – Schools segment 2 – Professional education segment 3- University segments both foreign and local 4- Organization segments 5- MBA Segments 6- Foreign education

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The desired positioning map for the business High Quality service

Low price

High Price

Low quality service

10.0 Operational Plan 10.1 Daily Operations The operation and process of the business happens daily online and offline activities. The web process is totally depending on the servers and databases. Daily web operation will be done in the office which could be rented out in Bambalapitiya. The web process daily includes 1- 24 hour customer service – online toll free calls and chat ( one customer service will be appointed per day in the first year of operation) 2- Site maintenance and checking – Checking for errors and technical problems 3- Server restarts every day to make effect new uploads 4- Database maintenance 5- Monitoring networking with the house connection of professionals and units 6- Editing ad words in Google yahoo and msn and monitoring the cost. 7- Quality Assurance Department every morning needs to ensure the assurance of the web site.

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Marketing operations daily include the activities of visiting organizations and universities to capture new projects. Meeting up professionals and educational experts to make contract with us, monitoring day to day operations and checking the related weaker activities and overcoming the barriers and make sure marketing operations not contain any error and look for new web marketing opportunities to promote the business.

10.2 Location The location of the business should contain a one floor building in an industrial area in Colombo. There should be a separate server and database room and Customer service call center. Also the location of the building should be easily accessible by every one in the beginning stage, because there may offline activities as well. The needed technical equipments for the operation are computers, server monitoring system, web video conferencing platform, web teleconferencing platform.

10.3 Management and Organization The company should be registered as a private limited liability company under the new company act No 7 of 2007. In order to incorporate the company we shall make an application in a prescribed form to the registrar of companies signed by the initial share holders of our company together with following documents.

1. Name of the company and a declaration that the name is identical 2. The articles of association of the company which contain the main objectives and other information. 3. The consent of the each person who has agreed to be director of the company 4. Consent in a prescribed form who are to be appointed as initial secretaries of the company.

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After receiving the certificate of incorporation which is treated as a conclusive evidence of the business, we can start the operation officially. We proposed to issue Rs 10/= worth of 1,000,000 shares to raise capital of 10 Million in order to fulfill the start up cost requirement. 10.4 Personnel The number of employees for the first year of operation includes approximately 20 employees. Post

Areas to looked at

Directors

Monitoring all the business area

Manager – Marketing

Getting clients, students, career guidance offers, advertisement etc

Manager – Web site

Designing, developing, checking the site

Manager- Accounts and Finance

Responsible for the cash flow

Manager – Technical

Date base, proper development and site functional

Panel of Professionals

Handle all kind of educational activities- contract basic

Marketing Executives

Capturing new clients, monitor marketing environment

The employees we recruit should be talented, and skilled. Our main asset would be the professionals we are going to make contract. All are well known Sri Lankan professionals like industry experts with high experience, professors, lecturers and consultants. We can find and attract them by a personal visit to their place. The top management will be responsible to get them first into the business.

For the technology department we should recruit qualified personnel’s with high benefits. The marketing executives can be recruited from universities and through recruitment agencies. All the marketing executives should contain knowledge on web sites and online activities. There would be an added advantage if they have experience

on virtual

organizations.

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Pay Structure Directors

–

70,000Rs each

Marketing Manager

–

50,000Rs

Manager Product development / Web Master –

50,000 Rs

Database Handler

–

40,000 Rs

Technology leader

–

30,000

Technical staff 5

–

25,000 each

Marketing executives – Field 2 – Basic 10,000 + Commission based on their clients Office 1 15,000

The salary structure will be for t 6 months operations during their probation period. Then it will be increased. All the recruited employees will be on a 6 moth probationary period. If they perform well the remuneration will be increased. Also detailed policy manual will be given for them to follow. The common policy will be agreed in the first to management meeting which will be held in the first year of operations.

10.5 Structure of the Organization

Directors

Web Master

Marketing Manager

Data Base Manager

Marketing Executives

Finance manager

Manager-technical

Technical staffs

After the first year of operations the number of employees will be increased in every department. Eg - Additional 10 technology staff, 5 marketing executives & an account executive.

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11.0 Financial Plan

This is an Internet venture that, of course, depends on the developing financial prospects of the growing Internet world. To make it work financially, we need to increase valuation on schedule to bring in substantial additional assets. For that reason we have increased the PPE time to time in order to fulfill the requirement of changing technology and striving need. We are proposing to spend Rs.5 Million as a start up cost at the beginning of the operation. In designing the financial plan of the e-knowledge lanka ltd, we have considered the following aspects. •

Assess the business environment (Virtual Business –Asset Based company)

•

Confirm the business vision and objectives ( Attain good return )

•

Identify the types of resources needed to achieve these objectives

•

Quantify the amount of resource (Work force, equipment)

•

Calculate the total cost of each type of resource

•

Identify any risks and issues with the budget set(Sector Under rapid changes)

Performing Financial Planning is critical to the success of any organization. In focusing the financial plan here we have taken some assumption. 1. Finance have been obtain by the way of issued of share capital of 600,000* Rs 10 shares. 2. Inflationary factors not taken in to account 3. Taxation is at the rate of 15% 4. No any dividend is paid to the shareholders 5. All the surplus cash is deposited at the bank (No investment were made) 6. Since this is service organization and our operations are diversified, we could not predict unit basis sales forecast or break even analysis

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3.1 Income and Expense forecast for 3 years E-Knowledge (PVT) LTD

INCOME STATEMENT FOR THE YEAR ENDED (All amounts in Sri Lankan Rupees)

31.12.2010

31.12.2011

13,000,000

18,000,000

22,000,000

7,000,000

9,000,000

10,500,000

6,000,000

9,000,000

11,500,000

Other Operating Income

500,000

800,000

800,000

Administrative Expenses

(5,800,000)

(6,500,000)

(7,800,000)

Distribution Cost

(2,100,000)

(1,850,000)

(2,000,000)

Other Operating Expenses

(300,000)

(300,000)

(350,000)

Finance Cost

(100,000)

(150,000)

(150,000)

(1,800,000)

1,000,000

2,000,000

-

(150,000)

(300,000)

(1,800,000)

850,000

1,700,000

Revenue

Cost of Sales

Profit / (Loss) before Taxation Income Tax

Profit / (Loss) after Tax

31.12.2009

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11.2 Balance Sheet Forecast for 3 years E-Knowledge (PVT) LTD BALANCE SHEET AS AT (All amounts in Sri Lankan Rupees) ASSETS

31.12.2009

31.12.2010

31.12.2006

Non Current Assets Property, Plant & Equipment

2,640,000

2,760,000

3,390,000

Current Assets Trade & Other Receivables Cash in hand and at Bank

500,000 1,760,000

700,000 2,790,000

850,000 4,710,000

2,260,000

3,490,000

5,560,000

4,900,000

6,250,000

8,950,000

6,000,000 (1,800,000)

6,000,000 (950,000)

6,000,000 1,050,000

4,200,000

5,050,000

7,050,000

300,000

550,000

800,000

400,000

500,000 150,000

800,000 300,000

400,000

650,000

1,100,000

4,900,000

6,250,000

8,950,000

Total Assets

EQUITY & LIABILITIES Capital & Reserves Issued Share Capital Accumulated Profit / (Loss)

Non Current Liabilities Provision for Retiring Gratuity

Current Liabilities Creditors & Other Payables Provision for Taxation

Total Equity & Liabilities

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11.3 Cash Flow Forecast for 3 years E-Knowledge (PVT) LTD FOR THE YEAR ENDED

31.12.2009

31.12.2010

31.12.2011

CASH FLOW - OPERATING ACTIVITIES (1,800,000)

1,000,000

2,000,000

Depreciation

360,000

380,000

370,000

Provision for Retiring Gratuity

300,000

250,000

250,000

(1,140,000)

1,630,000

2,620,000

Trade & Other Receivables Increase / (Decrease) in:

(500,000)

(200,000)

(150,000)

Creditors & Other Payables

400,000

250,000

450,000

(1,240,000)

1,680,000

2,920,000

-

(150,000)

(1,240,000)

1,530,000

2,920,000

Purchase of Property, Plant & Equipment Proceeds from sale of Computer Equipment

(3,000,000)

(500,000)

(1,000,000)

Net Cash out flow from Investing Activities

(3,000,000)

(500,000)

(1,000,000)

Issue of Shares

6,000,000

-

-

Net Cash Flow from Financing Activities

6,000,000

-

-

NET INCREASE / (DECREASE)

1,760,000

1,030,000

1,920,000

CASH - BEGINNING OF THE YEAR

-

1,760,000

2,790,000

CASH AT THE END OF THE YEAR

1,760,000

2,790,000

4,710,000

Profit /(Loss) for the year Adjustments :

Operating Profit before Changes in Working Capital (Increase) / Decrease in :

Cash Generated from Operations Income Tax Paid

Net Cash from Operating activities CASH FLOW -INVESTING ACTIVITIES

CASH FLOW - FINANCING ACTIVITIES

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