Business Plan Tech Horizon India

TechHorizon BUSINESS PLAN

Business Plan Prepared By:

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Table of Contents TOPIC

PAGE NO.

EXECUTIVE SUMMARY Our mission Venture Description Venture Organization Venture market Venture operations Stage of development Financials Funds sought

5 5 5 5 5 6 6 6 6

COMPANY DESCRIPTION Company mission Products/ Services Corporate philosophy

7 7 7 7

PRODUCT/SERVICE Product description Purpose Technological background & overview Benefits offered Stage of development Future research & development Limitations/liabilities Production Facilities Suppliers Environmental factors

8 8 8 implication 8 9 10 10 11 11 11 11 12

INDUSTRY ANALYSIS Size of the industry Key trends Future of RFID RFID in INDIA Target industry snapshots Target market Customer profile Corporate strategy: the initial customers Airports Shipping companies

12 12 12 12 13 13 16 16 16 18 18 2

Offices Educational institution Banks Libraries Tracking companies File management Stock management Retail stores Courier postal services Museums Penitentiaries

19 20 21 21 22 22 22 23 23 23 23

COMPETITIVE ANALYSIS Strategic position & risk analysis MARKETING PLAN Marketing approach Pricing profile Making of RFID equipments Employee’s salaries Utility payments Lease expenses GROSS MARGIN ON PRODUCTS/SERVICES MARKET PENETRATION Sales representatives/direct sales force Direct mail/telemarketing Advertising & promotion Activity Service & warranties Future markets

25 26 26 26 26 26 26 26 27 28 28 28 28 28 29 29

OPERATING & CONTROL SYSTEMS Receiving orders Billing the customers Paying the suppliers Collecting the account receivables Reporting to management Staff development Inventory control Handling warranties & returns Monitoring the company budget Security system Document & paper flow

29 29 29 30 30 30 30 30 30 30 31 31

PLANNING CHART

31 3

Product/service description Manufacturing Financial requirement Marketing flow chart Management & infrastructure

31 31 32 32 32

TECHNOLOGY PLAN MANAGEMENT Management team Organizational chart Development & growth plan Offering to market Expansion to product base

33 33 34 34 35 35 35

FINANCIAL PLAN Sales projections Income projections Cash requirements Sources of financing

37 37 37 37 37

START-UP FUNDING & EXPENDITURES PROJECTED CASH FLOW STATEMENTS YEAR – I YEAR – II YEAR – III Bibliography

38 38-41 42 43 44 48

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Executive Summary The Concept: Industries are growing and changing at a rapid rate. New technologies offer Opportunities and challenges to traditional businesses. Keeping pace with this vibrant environment is vitally important to compete in the fast-moving marketplace. Business owners have always sought viable solutions to increase hassle free security regarding assets and personnel within their organization along with augmenting efficiency in manufacturing, customer satisfaction, accuracy in activity logs and valuable customer data which combine to help position themselves to attain their ultimate and timely advantage. Our Mission: We strive for a reputation that signifies our pioneership and excellence in providing low cost, state of the art solutions leading our clients to achieve the desired levels of operational efficiency, amplified productivity and automation by eradicating resource wastage and providing them a secure environment, inducing competitive advantage, value addition to business processes coupled with facilitating the achievement of their business objectives. Venture Description: Tech Horizon is Uttar Pradesh’s first RFID based tracking system provider company and is poised to offer a multitude of tracking solutions. We believe organizations must leverage technology in their respective paradigms of workplace and production to gain security, automation, efficiency and eventually competitive advantage in today’s competition driven world. Being both product and service oriented, we are the first company that offers RFID based implementations in the state. Venture Organization: Our management team consists of CEO Mr. X, CFO & Marketing Director Mr. Y, and CTO Mr. Z. As all three member are having good technical background this will be advantage to company Venture Market: Our target market consists of growing privately or publicly held businesses with annual sales/revenues of at least Rs. 5 million. We prefer to serve companies that have a well established IT infrastructure and will primarily target businesses in the retail, education, banking, shipping, tracking, utility and medical sectors. The broad spectrum of our target market consists of companies that have more than 50 employees and are seeking office automation primarily in terms of operations, file management, asset tracking, employee attendance and tracking, and other security, efficiency related measures. Being the first to introduce RFID services in Uttar Pradesh, Tech Horizon faces no competition within the country making available expanded opportunities to gain a large chunk of corporate customers and be an early market leader. 5

Venture Operations: Tech Horizon’s business objectives include: • Growing to a product base until the end of our fifth year of operations • Becoming recognized as one of the top RFID solutions providers of South Asia • Building a highly profitable agency that delivers excellence backed by sound business processes Stage of Development: We plan to start operations as soon as financial needs are met. In the meanwhile, we are developing proposals/reports for our potential clients (mainly large organizations) in order to brief them about the benefits and opportunities that could be reaped from implementing RFID.Our technology is fully developed into a working prototype and has been tested at a multitude of different conditions and factors to check its reliability. Right now RFID consists of only one module which is general in nature and is thus designed to trace anything. The team is working on the development of modules to specifically address the needs of the various categories of clients like medical facilities, banks, offices, libraries, educational institutes, manufacturers and retailers. Financials: The financial strategy of Tech Horizon emphasizes retaining most of the income for the first three years to support operations and liquidity. The company expects steadily increasing profits and sales in the first three years and then a higher degree of growth in the years to come, making it more financially sound and lucrative for the investors. Annual revenue projections for the first three years are Rs. 7,70,000, Rs. 13,40,000 and Rs. 19,55,000. Funds Sought: We have a partnership of three people who will invest Rs 100000 each amounting to Rs 300000 and rest Rs 500000 will be taken as loan from bank at the rate of 12% annually for the period of 36 month ,to pay amount of loan taken we will have to pay EMI of Rs.16600 per month for the period of 36 months

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Company Description Tech Horizon is a Lucknow based venture proposed by a group of three students Mr. X, Mr. Y and Mr. Z. The company is the sole owner of Uttar Pradesh’s first Radio Frequency based tracking system and is continuously involved in research in order to design its various modules for different implications. The Company’s Mission: We strive for a reputation that signifies our pioneership and excellence in providing low cost, state of the art solutions leading our clients to achieve the desired levels of operational efficiency, amplified productivity and automation by eliminating resource wastage and providing them a secure environment, inducing competitive advantage coupled with facilitating the achievement of their business objectives. Products/Services: We offer our customers practical and highly affordable business solutions through the cheap and revolutionary technology of Radio Frequency Identification that will help them achieve desired levels of security and automation enabling them to eliminate theft and wastage of valuable resources (mostly time, inventory and equipment) and keep an accurate record of assets, activities, operations, transactions and customers leading them to achieve a competitive advantage over rivals and realize a higher degree of efficiency organization wide. The company will cater to the surging requirements of the corporate, retail, education, banking, shipping, tracking, utility and medical spectrums for automation that leads to substantial reductions in costs, resource wastage and a potent increase in efficiency. The implementations are limitless and vary from an individual retailer who needs to keep track on inventory to corporate clients that require increased security and efficiency related to their unique products and services; movement of personnel, equipment, machinery and other valuable assets. Corporate Philosophy for Doing Business: Tech Horizon’s goal is to become a perceived standard by its customers for providing solutions pertaining to automation and security. This can be achieved by following a two pronged strategy of being both product and service based by being service based initially and then growing to a product based level as soon as sufficient knowledge and experience pertaining to the needs of particular categories of clients and real time implementation issues is acquired in order to build standardized products. A complete transition to a product based level is not lucrative as the emergence of new RFID based solutions is continuously on the rise leading to the loss of valuable business opportunities. It is imperative to start with a target market of medium and large size businesses and then gradually probe the relatively small enterprise segments as small businesses mean many clients and therefore a high probability of paucity in efficient problem solving when the demand from begins to rise. A great deal of experience and resources in terms 7

of employees, equipment and money have to be in easy access most of which can be generated by value and monetary streams from the smaller but relatively resourceful segments of the target market. Furthermore, small sized businesses have a tendency to be rigid when it comes to hidden costs related to implementations while such problems can be least expected from the corporate side. This leads to our objective of being more inclined towards a service orientated approach when it comes to medium and large size businesses while following a product based approach for small size businesses.

Product/Service Product Description: RFID is a system created by the combination of Radio Frequencies and databases used for tracking and keeping a check on the movement of objects and humans within a specified location. The system being free from all external dependencies is a combined prototype of hardware and software, both which have been completely designed and developed by the Tech Horizon team. It is both Active and Passive RFID based thus being able to work on long and short ranges. The hardware consists of “RFID Reader” which reads IDs and Tags (that have unique IDs for objects and persons) in the surroundings. The Software Agent maintains logs and conducts mapping of ids on the Map on a computer screen provided by a World/Country/City Map Manager. At present time, there is only one module of the software which is general in all reverence i.e. it is designed to trace anything. The product addresses the needs of businesses, related to automation and security involving personnel and assets while entailing opportunities to reap insurmountable profits and benefits obtained through the data collected by it. Purpose of Product/Service: In general terms, RFID solutions assist clients to achieve desired levels of security and automation enabling them to eliminate theft and wastage of valuable resources (mostly time, inventory and equipment) and keep an accurate record of assets, activities, operations, transactions and customers leading them to achieve a competitive advantage over rivals and realize a higher degree of efficiency organization wide. Technological Background and Implicational Overview: Radio Frequency Identification (RFID) is an automatic identification system combined with databases. The purpose of an RFID system is to enable data to be transmitted by a portable device, called a tag, which is read by an RFID reader, and processed according to the needs of a particular application. The data transmitted by the tag may provide identification or location information, or specifics about the object/product/individual tagged, such as name, price, color, date of purchase, etc. In a typical RFID system, individual objects are equipped with a small, inexpensive tag which contains a transponder with a digital memory chip that is given a unique electronic product code (EPC). The interrogator or an RFID reader, an antenna packaged with a transceiver and decoder, emits a signal activating the RFID tag so it can read and write data to it. When an RFID tag passes 8

through the electromagnetic zone, it detects the reader's activation. signal. The reader then decodes the data encoded in the tag's integrated circuit (silicon chip) and passes it to the host computer for processing. The Benefits Offered: RFID systems have a broad range of usage offering a myriad of benefits. Some of them are: i) Cost Reduction: The cost reduction value case is a target area of many consumer packaged goods (CPG) companies, retailers and military departments. These enterprises strive to reduce inventory and inventory management expenses by billions of dollars on a continual basis. The cost-reduction benefits resulting in the implementation of an RFID program include: • Lower inventory stock levels • Reduced waste • Reduced manual checks • Reduced inventory handling costs • Reduced logistics costs • Reduced claims and deductions • Improved asset utilization ii) Increased Revenue: Worldwide, both large and small retailers and manufacturers are developing RFID deployments to drive sales. The utilization of RFID empowers companies to design innovative solutions with tangible benefits, including: • Reduced out-of-stocks • Improved order fill rates • Reduced shrinkage • Improved inventory turns • Enhanced in-store customer support iii) Counterfeit Product Shielding: Quality manufacturers across the globe are losing sales, profits and their quality image from the expanding flow of counterfeit products. Equally important, counterfeits of many products (such as pharmaceuticals, currency, passports and aircraft parts) represent a safety and security hazard for humanity all across the planet. There are several pilots in place to identify counterfeits using RFID. These RFID tagged products, coupled with real-time databases, represent a viable information platform to prevent the distribution and sale of counterfeit products. iv) Shrinkage of theft and Diversion Prevention: High-value consumer and industrial products face the large risk of theft and diversion. RFID has shown considerable progress in: • Identifying theft and diversion at the shelf level • Identifying theft and diversion points in the supply chain This technology will provide a widely used tool to prevent theft along the supply chain–from the factory floor to the storefront.

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v) Competitive Advantage: Any business case or profit improvement program is intertwined with a company’s business goals and competitive advantage. Several leading companies believe that RFID is the key to increasing competitive advantage. The advantages include: • Increased distribution center productivity • Increased yield per end user, customer or site • A flexible, adaptive supply chain • Cost advantage in logistics • Reduced impact of homeland security measures (e.g., country of origin) vi) Superior Info: RFID enables business owners to have real-time access to inventory information, as well as a broader, clearer picture of consumers' buying habits. It also enables retailers and corporations to peek into the lives of consumers in ways that were initially off limits. Products embedded with RFID tags can continuously transmit information ranging from an EPC identifier, to information about the item itself, such as consumption status or product freshness. Data processing systems read and compile this information and can even link the product information with a specific consumer. Such composite information is vastly superior— and more invasive—than any data that could be obtained from scanning any other technology as RFID systems enable tagged objects to speak to electronic readers over the course of a product's lifetime—from production to disposal—providing retailers with an unblinking, voyeuristic view of consumer attitudes and purchase behavior. Stage of Development Until now, Tech Horizon is just an idea therefore there is no physical asset owned by it. This business is a brainchild of three students, that combine to make a sturdy educational, creative, professional and entrepreneurial combination necessary to build a resoundingly successful business. We plan to start operations as soon as financial needs are met. In the meanwhile, we are developing proposals/reports for our potential clients (mainly large organizations) in order to brief them about the benefits and opportunities that could be reaped from implementing RFID. Our technology is fully developed into a working prototype and has been tested at a multitude of different conditions and factors to check its reliability. Right now RFID consists of only one module which is general in nature and is thus designed to trace anything. The team is working on the development of modules to specifically address the various categories of clients like medical facilities, banks, offices, libraries, educational institutes, manufacturers and retailers. Future Research & Development: The organization will conduct a formal year-end customer satisfaction survey within the client’s organization to address its information requirements pertaining to the additional needs and suggestions by services being ranked on the basis of responsiveness, accuracy, quality, results delivered and the value added to the overall security, efficiency, and automation of the company served. The team will continuously stay in touch with clients in order to resolve conflicts and problems and to update systems with new developments. In addition, a continuous market study 10

for emerging deployments and possible applications is and will be in progress for the purpose of identifying new markets and thus widening the customer base.

Limitations/Liabilities • There is a probability of bugs in the software, which most of the times are only discovered in real time implementations and take a while to be fixed. At times, some bugs can lead to data corruption of which Tech horizon can be held liable for. • Active RFID tags (not used as much as passive tags) have a limited battery life. • While we strive for measurable results, we provide a service/product that in some instances cannot be fully guaranteed. We must be careful in what we promise and be certain to provide accurate and efficient service, clearly define the boundaries of the system during its development and continuously monitor the programming codes of our modules for potential errors. • Issues of privacy have emerged in the RFID industry. • Employees of the client organization will need training in order to get familiar with the use of our product. Production Internal staff will handle production work. At present time there is no need for any specialized production as all parts are easily available in Noida at the STPI Noida, LOGIX Techno Park Sec- 127, Expressway, Noida, from where they will be bought and assembled manually. On the acquisition of a large contract which could not be handled by internal staff, the job would be considered to be handed over to a subcontractor. Facilities Tech Horizon pursues to establishing a leased office located in the area of Aliganj, Lucknow. A 1500 square feet edifice is more than adequate for a staff of three and can easily accommodate up to 8 personnel with the right phone system room upgrade and investments in professional cubicles, four unbranded computer systems, along with a separate room for the assembling of tags and transponders. Suppliers: There are suppliers of electronic hardware required in Noida at the STPI Noida, LOGIX Techno Park - Sec- 127, Expressway, Noida .The supplier that provides raw materials with the lowest price and a reasonable quality in parts would be selected signifying the fact that there cannot be a permanent one. Preferences would be built after a significant amount of experience.

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Environmental Factors: The organization is in the startup stage and the product poses no threat to the environment. There have been innumerable debates on the effects of GSM chips (which emit radio frequencies) on the human body and health of which most have been proved by research. Majority of the RFID tags involved in the implementation will emit radio frequencies that will be fractional to the frequencies produced by GSM chips thereby minimizing any harm to the human body.

Industry Analysis & Trends Size of the Industry In 2009 IDTechEx, a research firm, estimates that the value of the entire RFID market will be $5.56 billion, up from $5.25 billion in 2008. This includes tags, readers and software/services for RFID cards, labels, fobs and all other form factors. The majority of this spend is on RFID cards and their associated services - totalling $2.99 billion. In total, 2.35 billion tags will be sold in 2009 versus 1.97 billion in 2008; 1.74 billion in 2006 and 1.02 billion in 2005. Key Trends: • The industry is fragmented but showing some signs of consolidation. • The barriers to entry are gradually increasing, but they are still low. • Competitor rivalry is high in some segments. • In general, customers have significant bargaining power over suppliers. • Price pressure is severe but decreasing gradually. • There is growing interest in RFID for homeland security, retail and logistics with multi million dollar enterprises taking steps for broad, in depth applications. • There are near to 700 medium and large size companies offering RFID solutions. The Future of RFID Currently, RFID tags are not widely used in consumer products because the price of the tags is still prohibitively expensive for retailers to use it in masses. However, as technologically ambitious companies push for enhanced means of tracking products and profiling consumers, the increased demand and production of RFID technologies will drive down prices. Already, developments are yielding systems with larger memory capacities, wider reading ranges, and faster processing. In response, the market for RFID tags is growing explosively, projected to reach $10 billion annually within the decade. In spite of the costs, some retailers are willing to pay the price for the insight RFID tags provide into the lives of consumers.A handful of corporations have already signed on, and are moving ahead with plans to embed products with RFID tags. Not too recently, Microsoft Corporation announced that it would develop software that will enable retailers, manufacturers, and distributors to use RFID tags to track goods within stores and factories, as well as programs specifically designed to use the new retail tagging technology.

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RFID in India Retailers, textiles, aviation, energy and auto sectors in India are switching to this new concept over the last 5 years after seeing the results of implementation in the developed world. This is also necessitated by pressures on them by suppliers from abroad to comply with global business practices, failing which they run the risk of being left behind. Infosys Technologies is a founding member of EPC and Wipro technologies have been associated with Auto-ID Lab at MIT for some years now. Both these companies play a big role in the EPC which provides standards for implementation of the technology. Similarly, Gemini Traze RFID Pvt Limited is building India's first RFID tag manufacturing unit at Sriperumbudur Electronic Park near Chennai. It plans to roll out 45 million units which would be increased to 100 million units per year later on . One of the main companies that is testing this technology is Kishore Biyani's Future group, especially at Pantaloon and Big Bazaar. Pantaloon has piloted an RFID project at one of its warehouses in Tarapur using more than thousand RFID tags . It selected a few lines of apparel for the RFID pilot project. The application was developed by Wipro Infotech and integrated Oracle database also. Nowadays, we can see the major retailers having a plastic flying saucer shaped knob like structure on dresses while on display at the store which are removed when they are billed. This helps in tracking of goods and security from pilferage as it lets out an alarm at the exit door if not billed properly. Madura Garments also experimented with RFID and has incorporated them in their Planet Fashion stores as well as factories and warehouses. The national carrier Air India is planning to use RFID for tracking capital assets. Leading oil companies have begun pilot tests to use RFID for LPG cylinder tracking, The Indian railways is also thinking on these lines for tracking wagons and containers. Maruti Udyog Limited has been using RFIDs for component and spare parts tracking for some time now at their Gurgaon plant. Ashok Leyland is also using this for the same purpose. It has tremendous advantages as there are more than 20,000 parts in most vehicles and tracking the movement of each one of them through the supply chain is a mind-blowing task. Mahindra & Mahindra are also using RFID in car some of the manufacturing processes like Pretreatment of Body Shell and Electro-deposition that are done in harsh conditions. In the pharma sector, Ranbaxy Labs and Pfizer use it for counterfeit protection. Airport Authority of India is considering RFID for the cargo and passenger goods management. Outside of retail and auto sectors, libraries like Jayakar Library of Pune University and Dhanvantri Library of Jammu University have adopted RFID. Hyderabad Central University has introduced RFID embedded degree certificates. The municipal corporation at Hyderabad in 2006 had introduced RFID usage for keeping track of garbage collection & disposal trucks and their 13

drivers to monitor them due to instances of reported malpractice in collection & disposal. Applications are there in healthcare where new born babies can be RFID tagged so that they are properly monitored in hospitals. It can be used to improve security and in military uses for proper tracking of supplies to the armed forces. There are applications possible in Electricity/Water meters which can help make the manual recording and reading automatic, remote and fault free. The applications are enormous and far-reaching, and India has just started. Target Industry Snapshots As RFID addresses a global array of business applications, there are dozens of RFID deployments and pilots around the world today. A short list of examples would include: • Retail supply chain • Military supply chain • Container tracking and management • Pharmaceutical management and tracking • Automated payment solutions • Baggage tracking and management • Vehicle, paper and aircraft assembly • Asset tracking • Document tracking The highlights of some of those pilots are shown below: a) Retail Supply Chain: The power behind a hassle-free shopping experience is radio frequency identification. RFID is helping retailers around the world improve customer satisfaction and increase sales. The technology is transforming the retail industry by store productivity and loss prevention. Many of the world's largest retailers have mandated RFID tagging by 2005. This move affects more than 200,000 manufacturers and suppliers, driving the worldwide market for hardware and software to support RFID. Retail interest in RFID technology is driven by the desire of companies to achieve greater speed and visibility into their supply chains, with the goal of increasing both operational efficiency and store effectiveness. An efficient supply chain operation ensures that goods can be delivered to the place and time when consumers are ready to purchase. Potential gains from the visibility RFID generates include lower inventory levels, reduced labor costs, increased sales and numerous other benefits in the long run. b) Benefits of Speed • Eliminate lost sales due to out of stocks • Speed up store receiving, processing, replenishment plus point of sale (POS) and returns processing • Notification of units needed on sales floor upon store receipt • Satisfy customer requests immediately by locating products on sales floor and in the backroom • Fast, accurate inventory audits 14

• Increased distribution center efficiency and accuracy Benefits of Visibility • Unit, carton and pallet-level visibility throughout supply chain • Immediate identification of exceptions at check points • Visibility to replenish the right product to the right place at the right time • Block defective and counterfeit merchandise In the near term, the emphasis for RFID is on applications, which involve “the supply chain to the store backroom” — tagging pallets, cartons and reusable containers to track the movement of goods throughout the distribution system. c) Manufacturing: Proprietary RFID-based solutions have been used for a decade in the manufacturing space. One of the established uses is in the automobile manufacturing process. Automobile companies attach read/write RFID tags to the car chassis. The RFID tags provide direction to and record the completion of each assembly process. Other manufacturers are working hard to exploit the potential of RFID in their operations. Example benefits that manufacturers have identified include: • Fast assembly • Identification and elimination counterfeiting • Improved accurate/reactive production planning • Reduced stock/work in process (WIP), increase make-to-order • Reduced efforts on stock counts • Reduced product recall costs • Correct parts identification, reduced maintenance • Accurate and real-time inventory • Accurate packing list and invoice information • Cheaper disposal • Tighter linkage to distributors • Safer products • Improve manufacturing processes and inventory control • Protect brand values Linking the Manufacturing Floor to the Retail Floor: Real-Time Inventory Several manufacturers today are experimenting with RFID-based tagging of higher-value merchandise. Examples include consumer electronics and pharmaceuticals. The concept is to audit the RFID tagged inventory on the retail floor and use that information to drive manufacturing and shipping of the completed product. In summary, RFID gives the producers total visibility into the movement throughout the supply chain. Relationships with retailers provide powerful incentives for offsetting some of the costs, with the agreement to share information with these valued trading partners.

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c) Transportation and Logistics: The logistics sector is positioned to be one of the primary beneficiaries because of the adoption of RFID into the supply chain. It is important to recognize that the RFID compliance mandates generated by Wal-Mart and others supply chain behemoths address the receipt of merchandise and assets into these large enterprises. For the logistics industry, with its position between suppliers and customers, RFID tagging and the underpinning mandates represent a great opportunity to expand the portfolio of offered services. Opportunities in logistics include: • Working with shipping customers to provide RFID compliance services that solve the compliance challenge • Expanding service and revenue base to suppliers and customers by using the RFID tags to define new information based services as a source of competitive differentiation • Looking at using EPC in cross-docking operations to increase efficiency • Faster delivery turnaround • Faster custom clearance • Theft prevention d) Distribution Center Operations: EPC-RFID based applications have drawn extensive interest in the operation of the distribution center. Innovators argue that RFID technology can make distribution centers more cost effective. Studies suggest the following the operational improvements through RFID: Shipping and Receiving • Automated processing of loading and unloading • Reduced labor requirements • Faster processing • Automatic cross docking • Automatic generation of 100 percent accurate electronic manifests • Storage and Fulfillment: • Correct product storage locations • Faster product retrieval • Fewer order errors • Reduced losses and shrinkage of assets • Improved order-fill rates and times • Less safety stock required Task and Resource Management • Automatic updating of tasks for each resource • Improved automation and accuracy of flow control • Improved real-time monitoring of operations • Automatic conveyance and sorting • Automated and accurate picking and packing

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A primary objective of RFID-based systems is to provide real-time visibility into all of the supply chain. To achieve that end, the distribution center needs to be part of the real-time, RFIDenabled supply chain. Target Market There are about 100,000 small-scale and medium units in UP and the state ranks fourth in the country in the number of SME units. Some of the running clusters in UP include, sports goods (Meerut), glass work (Shikohabad/Ferozabad), leather footwear (Agra), locks (Aligarh), carpets (Bhadohi/Varanasi), apart from this all educational institutions and hospitals are also our target market .Armed with a technology which has a large scope of applications the world over, Tech Horizon is targeting medium and large organizations that fall in the following markets: Applications Market  Automobile Immobilization  Attendance systems  Baggage Handling Health Care Services  Fixed-Asset Tracking Government  Library Systems Banking  Educational Institutions  Point of Sale (POS)/Plastic Money Retail In-Store  Real-Time Location Systems (RTLS) Commercial Services  Security/Access Control Industrial/Manufacturing  Personnel tracking Transportation/logistics  Supply Chain Management  Transportation/Ticketing Customer Profile Tech Horizon’s ideal customer is a privately or publicly held company with annual sales/revenues of Rs. 5 million at least. We prefer to serve companies that have a well established IT infrastructure. Though our venture serves a variety of customers, we specialize in serving companies that pursue personnel and asset tracking. Our largest clients are those organizations that have a large number of employees or those which belong to the industries of card banking, manufacturing, retailing, supply chain, logistics and health care. Our smaller clients include educational institutions, libraries, commercial services, museums, and organizations that are willing to pursue efficient file management and attendance systems. Corporate Strategy: The Initial Customers Tech Horizon aims to introduce revolutionary tracking solutions in Uttar Pradesh and dominate the market by being both product and service oriented thus enabling itself to continuously introduce innovatory uses of RFID technology for corporate and individual customers. Being a new technology in India, we have an opportunity to create the market. As the scope of RFID is almost limitless, overall market potential has still to be determined. Critical to the corporate strategy is the continuous development of modules of our software that would be purely designed 17

for specific implications in different industries/sectors/businesses/institutions. These include modules for: Medical Facilities: Medium and large sized medical facilities can also benefit from the widespread applications from RFID. Tags can be embedded into wristbands for patients and in ID cards for employees. Such solutions will not only meet immediate needs, but will also deliver the flexibility to explore further unnoticed opportunities. With the introduction of RFID, medical facilities will have the following benefits: • Solutions to track employees and patients with all medical history and personal/official statistics/information being recordable into a single chip which can be synchronized with databases whenever needed. • The reader when waved over patient’s wrist will bring up the problem list, medical history, patient information, medications, allergies and other critical information thus simplifying patient identification and save clinical - staff keystrokes. • Elimination of the bulk of paper forms while ensured up to date information for the medical staff. Having such a system in place, there will be a dramatic reduction of errors in drug prescription, increased hospital security and a prevention of patient identity mix-ups while giving patients the opportunity to replace tags (that with contain all their medical history) for health files that have to maintained and produced in an appointment. • Faster emergency treatment as a result of enabling hospital personnel to gain access to patient records more quickly making the handling of administrative tasks simpler than with the paperbound system. • The availability of accurate information without any lag time as staff will no longer have to return to a nurse’s workstation to obtain patient data. • Convenience of updating information across work shifts allowing caregivers to spend more time with patients and less on administration. • Access for doctors and nurses to a new platform for wireless database to order lab tests, enter notes on treatment, update medication administration right from the bedside, and so on. • More efficient billing and pharmacy information systems. • Solutions to track blood for transfusion and monitoring surgical instruments. Airports: The business case for airlines is simple: no one likes to lose their bags. Baggage handling has always been a potential predicament for airport personnel. Current processes are typically driven by barcodes, but still involve a lot of manual loading and sorting, which leaves plenty of margin for error. The advantages of RFID over barcodes in this application are that it is contact less and unidirectional. An RFID baggage module can assist in real-time tracking of baggage through the numerous legs of origin to destination. By tagging baggage with economical passive RFID chips, containing all information regarding the baggage such as weight, owner’s name, owner’s passport number, ticket number, flight number, airline etc., linked to a central database used by all domestic airports, the flow of baggage traffic can be managed in an amicable way. Capturing the bags that have been loaded on a manifest and matching them 18

against the expected manifest in real time (as bags are loaded) is enabled through the processing within an Event Engine pipeline checking for misplaced bags. Also, transponders mounted at various locations in the airport or used through handhelds by security personnel would assist in the tracking of baggage if it is lost or sought for and will play an active role in owner authentication at exit points combined with eliminating the possibility of evasion of any luggage from scans/checks. Due to its high volume of data, generated from the number of units moving at any one time and the number of events each bag generates, RFID has the scalability for airport deployment on a national scale.The types of events include:  Bags arriving at check-in  Passing through security  Being loaded into a tagged container  The container being loaded onto an aircraft  Being unloaded at its destination or intermediate stop  Bags for the current destination removed from container, new bags loaded into the container  Final arrival  Final unload of the containers  Final bag unloading  Bag routing and passing into arrival hall India comprises of 92 airports and out of which 12 are international airports . Shipping Companies: Registers have to be manually maintained in order to record the arrival and departure of containers/trailers at the entry and exit points of ports/depots/shipment companies. At most places, the data is then digitized by computer input. RFID tracking solutions can prevent this lethargic activity by fixed transponders at entry and exit points. Fitted in every vehicle/container and relevant data fed into them, the read/write tags will communicate information (such as vehicle number, type, time entered) as they pass through the transponder’s electromagnetic field which then would be automatically fed into the computer in an organized database. This way vehicle activity would no longer need to be recorded manually at gatehouses thereby saving time and massively improving efficiency and trailer management on site. Port personnel can use RFID to track containers through each stage of the shipping life cycle, from warehouse distribution and container stuffing to transport and arrival at the final port destination. In conjunction with a fully automated sorting system, shipping companies will be able to benefit from an integrated delivery, sorting and dispatch system, improving both delivery times and efficiency. India currently has 12 major ports and 184 minor /intermediate ports spread across the vast coastline of 7517 kms. They handle almost 90 per cent of India’s total foreign trade. .

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Offices: Companies having large premises face the problem of tracking employees at the time of need. These situations result in problems in the form of lost opportunities and time. A setback of employee incompetence also hovers in the shape of not being at the seat, misstatement of overtime, coming late etc. There is also a major concern for security with regard to the entrance of unauthorized personnel in the building and its sensitive domains. By implementing RFID, organizations can: • Setup employee domains: For example, a salesperson of the bank cannot enter (go through the automatic entry door operated by a transponder) the vault due to the authorization level set in the tag embedded in his employee card. • Establish an efficient attendance system: Employee diligence and pay can be measured easily if the date and time of the arrival of an employee in the organization/department is recorded automatically by a transponder and added into the payroll database. • Maintain an effective payroll system: Overtime would be paid fairly when the time of employee departure would automatically recorded by transponders. • Locate where an employee is in the premises: Since transponders would be mounted at several locations in the premises, the location of individual employees can easily be tracked down by using our user friendly software which would help finding people at the nick of time thereby reducing the probability of lost opportunities and time wastage. • Curb with employee incompetence: Incompetent and carelessness threatens an organizations productivity, value and existence every single day. Logs containing employee entrance time reflect one’s professionalism or ineptitude thus assisting the higher management in evaluation. • Secure the premises by keeping a track on all movements: By tagging all concerned individuals i.e. employees, guests and staff members (tags embedded in their cards) security can be tightened. Not only this, but vehicles can also be tagged (temporarily or permanently depending on the entity which owns the vehicle) to keep an eye on activity in the parking lot. • Maintain logs of activity: An archive of logs containing the details of movement of all individuals can be maintained for record and investigation purposes. • Keep a track on fixed assets: A number of lethargic activities have to be done on the behalf of the finance departments to keep a track on the fixed assets i.e. electronic equipment, furniture, cabinets. This includes assigning different combinative numbers, database entries and physical search and verifications. As RFID tags are awfully cheap, these assets can be tagged thereby automating many processes, improving productivity and saving time. Educational Institutions: There has been a continuous decline in the level of discipline being followed by students and teachers at almost all educational institutes in India. This includes coming late (both), bunking classes, being involved in undesirable activities such as violence, corruption, doping etc. By maintaining a daily log and surveillance system, these problems can be addressed. The only thing needed to be done is to mount transponders at various exit/entry points of the premises which would read all the information from the tags, embedded in 20

student/employee/teacher ID cards that enter their electromagnetic field. The data, if of a usual nature, would be added in the database or discarded while unusual data (for example, an unauthorized exit of a student from the premises) would be promptly notified to the designated personnel. By mounting transponders at classroom entry/exits, the benefit of an automated attendance system can also be reaped from RFID thereby saving the time wasted by taking a manual attendance by the teacher. Furthermore, in universities/schools with large campuses, it is often hard to find teachers, employees and students resulting in a tedious physical search. This problem can also be solved by tracking their location. There is always a concern for the security of infants/toddlers at primary educational institutes. Since, this age group has a tendency to wander off; at times children get lost and even manage to get out of campus. Keeping a track on their movements would be a viable solution. Applications of RFID also extend to restricting access to certain space. For example, no student is allowed to enter the office where all the printing of examination material is conducted. A RFID transponder mounted on the automated door will only grant excess to authorized personnel. In a nutshell RFID provides the following benefits to educational institutions: • An animated movement of tagged individuals on a computer screen • An automated attendance system • A daily log of movements of all tagged individuals which will be valuable for investigation purposes • Tracking solutions on premises • Restricted access to certain space Plastic Money Issuers - Banks: What is the main hassle of shopping or withdrawing money with a credit or debit card? The loss of contact with the card until the transaction is completed. The card swiping process not only induces a feeling of insecurity and unconscious intrigue to the card holder but it is also slow and comparatively less reliable. For example, when these cards are placed into a wallet, they sometimes loose their original shape and thus they malfunction at point of sales (POS) and automated teller machines (ATMs). At times, they have to be swiped twice if not ran through appropriately thereby wasting time. They even get captured in Automated Teller Machines (ATMs) very often. It is estimated that magnetic stripe cards must be replaced two to three times per year. All such troubles can be addressed by embedding cards with passive RFID (read-only) tags that can be read from any desired distance by existing Point of Sale or Automated Teller Machines which can be indigenously upgraded to accept both swipe and RFID cards. RFID cards do not get damaged or need to be replaced so frequently as they are not exposed to any rugged device. There are no insertion points to get damaged, as with card readers. The lifetime investment and ongoing maintenance costs for RFID is below that of all known alternative choices like magnetic stripe systems thus making it a lucrative investment. Such an application ensures faster transactions and less hassles thereby saving time of the customer and the opposite party involved. The best approach is to initially offer this technology, along with Tech Horizon’s services, to banks with the lowest market share in order to help them gain competitive advantage. 21

Libraries: RFID solutions can be put into practice into both digitized and non-digitized libraries. The application is particularly much easier in completely non-digitized or offline libraries as this gives the opportunity to design databases from scratch (at first) that would completely be compatible with RFID solutions. Nevertheless, apart from some complexities, already digitized or online libraries also provide a sufficient level of viability due to existing data infrastructure and information systems. Small and medium sized libraries, private or state owned, can also afford to adopt these applications. This involves tagging the cards of library members and books coupled with developing smart shelves in order to trace them within the vicinity and detect unauthorized removal. Of course such an application is only applicable to the expensive reference books that lie in the tendency of being stolen. Miniature passive RFID tags can be easily embedded between the pages or binding of books making them undetectable. Libraries would benefit from RFID by: • Faster issuance of books: Tags embedded in the members’ card and the books would contain all relevant information (title, writer, edition, last date of issue, name, membership due, age respectively) that can be read by the transponder provided at the reception granting the librarian the comfort of not typing any information and issuing books instantly. • An organized database: The information read from tags would instantly be updated in an organized database depicting the names of the book and member, the member’s registration number, the date of issue etc. This would eliminate manual tasks such as totaling the number of fine an individual has to pay at the end of the semester/degree. • Efficient book management: Transponders embedded in shelves would change them into “smart shelves” which would continuously reveal the location of the books eliminating the hassle of finding them if they are mistakenly placed at an incorrect site. • Increased Security: By mounting transponders (which would be connected to the central database showing the issuance status of the books) at the library exit, it would be impossible for non-issued books to be stolen. Tracking Companies: Despite increased efforts of law enforcement agencies; there has been a continuous increase or an unsatisfying decline in vehicle hijacking in various cities of the country. All vehicle tracking companies are currently using GPS (global positioning system) technology to signal a vehicle’s location via SMS messages over a mobile phone network. The vehicle activity is recorded by modules attached to each vehicle, and movement is tracked wirelessly nationwide. The data is transmitted to a central, Internet-connected computer where it is stored. More security at substantially cheaper rates can be introduced with RFID implications in this regard. With a vehicle tag costing only Rs. 600 – Rs. 800, an RFID automobile immobilization and tracking system can execute all the functions performed by its GPS technology based counterpart. Such low installation and operational expense would lead to an expanded market comprising of owners of relatively cheaper cars; motorcycles, taxis and all kinds of 22

transportation companies ranging from local and intercity bus services to nationwide freight transportation companies. Governmental and semi-governmental organizations can also benefit by keeping a track on vehicles that are prohibited for personal usage. Although such a system is cheap (more cheap for the end-user), it requires an extremely large amount of funds initially in order to build its underlying infrastructure. Therefore, the most favorable strategy is to sell this technology along with continual services to an existing tracking company. This would eradicate the need of laying down a new infrastructure and it would expand the customer base of the company adapting it. File Management: Almost every large and medium sized organization has to deal with managing an ever growing number of files. Problems arise when these files get misplaced. By mounting an inexpensive tag on files, their can be easily viewed/tracked on a computer screen thereby saving time, hassle and increasing efficiency. Stock Management: In spite of all the advances in the field of inventory management, it has always been difficult to keep an accurate update on the status of inventory. In addition to this, auditors and employees also face numerous hurdles when it comes to physical counting as at times items are wrongly placed on other shelves. With the implementation of RFID, organizations will become more efficient by keeping a track on inventory consumption, requirements, reduction in errors and opportunity wastage, and maintaining a steady flow of inventory. Retail Stores: RFID provides innumerable opportunities to retail outlets of different nature. It is an extremely feasible implementation which provides hassle-free and secure shopping. Such outlets include those which sell apparel, jewelry, paint, computer parts/equipment, multimedia equipment, petrol pumps and (mostly) any kind of expensive product. There is always a probability of theft at all retail stores especially when it comes to costly products that are small in size for example, rings, earrings, toys, gadgets, vehicle parts etc. RFID offers retailers real-time visibility into inventory and product movement to improving store productivity and loss prevention. Minuscule RFID tags (not visible to the naked eye) can be mounted on such 24 Major County Attorney’s Office Saves $200,000 Annually with RFID File Tracking System, objects to detect their unauthorized removal thereby decreasing shoplifting. The main advantage of such tags is that data can be read and written to them thus providing the comfort of reusing them for another product after the sale of the product they were previously mounted on. In addition all relevant information about the product can be written on the tag which would also assist in an accurate transaction/sale recording enabling businesses to synchronize inventory status and maintain an accurate amount of stock. Almost all medium and large retail stores use Point Of Sales for credit/debit card purchases. Using an RFID and Swipe card based POS machines will also push sales.

23

Courier & Postal Services: Being the cheapest of all tracking technologies, RFID can also be used by courier and postal services to track the status of specific deliveries enabling them to even share the automated information with customers through a website. Not only this, but diminutive tags attached to postal packages, would contain all relevant information such as sender, recipient, size, weight, dates etc. would be readable by RFID interrogators attached to handhelds used by the delivery personnel. These handhelds would contain databases which would be updated at the time of delivery through the interrogators. This way courier and postal service providers would be able to maintain an accurate record of all pending and distributed deliveries thus eliminating manual recording and human error. At present, there are hundreds of regional, national and international courier companies operating in the country and providing courier service at the level of inter city, inter provincial, national and international while the national postal service consists of a network of over 1,55,618 offices in India. .Museums: Artifacts can also be tagged which would be programmed to set off the alarm system if mobility occurs thus providing increased security on an item level basis. Penitentiaries: Keeping a track on prisoner movement could never have been easier. RFID solutions are the most efficient tool to maintain in-house security within normally large prisons providing an opportunity to eliminate discipline violations. RFID tags connected to the databases containing information such as prisoner threat/discipline level, term, name, prisoner number etc. combined with an animated map showing all prisoner vibrancy on a computer screen is only one of the possible applications to ensure an optimum level of scrutiny. In addition to keeping track on prisoner movement, RFID systems can also be used keep on prison personnel. For the fourth year in a row, a federal government report has found overcrowding at jails throughout Indian Country. Since 1998, the number of inmates housed in tribal and Bureau of Indian Affairs facilities has jumped 26 percent, the Department of Justice reported. According to data released recently, the jails were operating at 92 percent capacity, an increase from the year prior.

Competitive Analysis: Being the first company of its kind in the state of Uttar Pradesh, Tech Horizon is well-positioned to take advantage of the significant opportunities indicated by the rapid progression of RFID implementations all over the world and by the ever-growing need for security and automation to support a sustainable economic growth in India. Some of the known companies in the global industry are: Microchip Technology Motorola Philips Semiconductors SAMSys Technologies Savi Technology 24

Siemens Sokymat Symbol Technologies TAGSYS Texas Instruments TransCore WhereNet Alien Technology Assa Abloy Atmel Bewator Group Checkpoint Systems CHEP Combitech Systems Gemplus HID Intermec Technologies (UNOVA) Marconi Info Chain Matrics RFID Strategic Position and Risk Analysis Tech Horizon faces the same business risk as any enterprise, such as a loss of important clients or a downturn in the economy. We will be operating as a lean staff with very little overhead. Another risk we face is an RFID system fraught with errors and ineffective in its delivery. Our defense against this is vigilance. It will be liable for us to check and double-check all our work and facts. If we do make an error that thwarts the purpose of the system, we will have to incur costs to achieve the desired results. As technology continues to race forward and prices fluctuate in the marketplace, we will continue to scan our environment for the most innovative, costeffective ways to produce RFID systems. Since Tech Horizon provides services on the basis of a single technology, there is always a potential risk of the advent of a more efficient and reliable technology facilitating the same functions Competition is another expected risk. It is quite likely that Tech Horizon will have to indigenously prioritize between projects when business is established due to which certain proposals would be turned down or delayed. An environment with only one player and impending demand proposes lucrative opportunities for new players which could either be newly formed or evolve from related solution providers. Backed with proper or excessive funding and outsourced potential, such entities can prove to be significant impediments to Tech Horizon’s success. Critical to the success of Tech Horizon is proper funding. The majority of the funding will go towards establishing the business, supporting business operations, product development and marketing efforts to help educate the target market on the new concept. Proposals supported with presentations to potential clients are essential to 25

quick market penetration. Should Tech Horizon be unable to secure the necessary financing, expected levels of efficiency would not be met, severely limiting the ability of Tech Horizon to quickly expand and take advantage of the new product in a timely fashion.

Marketing Plan Marketing Approach Potential customers would be reached by personal selling; meetings that provide a brief overview of applications in their organization, business dinners, direct mail and advertisements in newspapers and technology magazines. Pricing Profile As implementations will vary, so will the prices. The main elements taken into consideration for charging clients would be:  Costs of establishing an RFID infrastructure  The range associated with tracing objects and people  Cost of technology and equipment involved  The hourly market rate of programmers  Costs related to subcontractors Other Costs The variable and fixed costs to be considered are of: • Parts involved in the making of RFID equipment Most of the parts are easily available in STPI Noida; some parts are taken from Radio Sets made in China. The rough cost of an Active Reader comes to be Rs. 3000 for the range of 400-500 sq. meters. Passive Tags cost around Rs..80 /tag, which may vary depending upon deployment. If the same is deployed on a car, the cost will rise to Rs. 600 - Rs. 800. If it is for a person in specified vicinity then the cost would be around Rs. 10 - Rs.100, totally depending upon the scenario.

26

• Utility Payments This includes electricity and water. • Lease Expenses This involves the initial down payment, monthly rental payments coupled with interest expenses for the office lease agreement. • Promotional Costs Our promotion chart elaborates the periodical incurrence of all promotional expenses.

Gross Margin on Products/Services PRICE PRODUCT Standard RFID Reader (Reading range is few sq meters, max 1500-2000 sq feet)

8000

DIRECT COSTS 3000

Standard Passive Tag for Humans/Objects within organization

20

.80

19.20

99.60%

Miniature Software Module 2,50,000 High End Software Module 3,50,000 1,80,000 High End RFID Reader (Reading range is 500 sq meter to 2 sq km)

90,000 1,50,000 65,000

1,60,000 2,00,000 1,15,000

64 % 57.14 % 63.89 %

15,000 Initial Feasibility Study (miniature and intermediate) Initial Feasibility Study 30,000 (high end) 2,25,000 Implementation (Miniature) Includes: Employee training, fixing tags and readers, creating infrastructure, organizational testing and map creation

10,000

5,000

33.33 %

20,000

10,000

33.33 %

1,05,000

1,20,000

53.33 %

27

GROSS MARGIN 5000

GROSS MARGIN PERCENTAGE 62.5 %

6,75,000 Implementation (Intermediate; same as miniature but involves a larger magnitude of deployment)

3,15,000

3,60,000

53.33 %

Implementation (High 20,25,000 Scale; same as intermediate but involves a larger magnitude of deployment)

9,45,000

10,80,000

53.33 %

350

350

50.00 %

Standard Active Tag for Humans/Objects within organization (recommended for valuable goods)

700

Market Penetration Sales Representatives/Direct Sales Force Mr.Y will continue to generate new business for Tech Horizon through personal selling, direct mail, advertising and other promotional efforts geared towards companies that fall in the target market, will report directly to Mr.X. Their main job would be to identify and collect information about potential clients/industries and make feasibility reports according to the deployment involved in their organization. Direct mail/Telemarketing: Tech Horizon plans to engage in direct mail operations in at least three months of its first financial year. If desirable results are achieved, a similar program with necessary variations would be carried out for the next two years. Advertising and Promotion: We have decided to initiate the following stream of promotional efforts once the company operations are commenced. It has been realized that once Tech Horizon engages itself in a project, promotional efforts during that time span, in general, would carry a highly probable detrimental effect on company reputation. This is because of the reason that the company wouldn’t be able to cater to any demands from the potential clients created by the promotional 28

efforts due to its commitment with existing projects. The best solution to this is to indulge in promotional activities when the end of a project is near. This would facilitate the acquisition of new projects as soon the old ones have been completed.

Activity 1. Send 65 selected executives complete brochures and proposals to discuss implementations in their particular division 2. Mail direct mail to targeted businesses in Lucknow. If a 5% response rate isn’t achieved, materials will be revised. 3 .Submit editorial and ads to the Business, Tech Magazines for inclusion 4. Complete Website and send postcard to clients and prospects to check it out. 5. Host a dinner and invite a group of potential clients 6. Submit editorial in @internet magazine 7. Place meetings with potential clients from the private educational institute sector 8. Send clients and prospects holiday cards Service and Warranties: Tech Horizon will charge an initial fee for module development and annual service fee for product updates and maintenance but will not entitle itself for any damages that occur if the system is used outside the boundaries of its capability. Error or bugs reported by the client will be removed as swiftly as possible. Future Markets: Implications of RFID have no end. This technology has the capability to revolutionize every industry. Tech Horizon will continuously be on the look out for organizations in need for automated processes. We will focus on national sales while keeping an eye on international potential. We will start developing systems for small businesses as soon as the primary segments of the target market are competently catered to.\

Operating and Control Systems 29

Administrative Policies, Procedures and Controls Receiving Orders: Our technological and financial experts will schedule meetings with the client upon a request for services and collect information pertaining to their business needs. A feasibility study would be conducted and a report would be handed over in two weeks at the least for which a calculated amount of fee would be charged. Upon approval, contracts will be prepared and submitted to the client. Operations (programming, designing of hardware) related to implementing the technology would start as soon as all legal matters are dealt with. The personnel/staff/employees supposed to use the equipment will be trained at the end of the implementation accordingly. Billing the Customers: Being a new venture, Tech Horizon has the ability to sustain expenses only a short term basis. Therefore, it will charge the client for the management fee, programming hours, expenses and costs of equipment each month during the implementation phase. An estimated amount of all expenses (total and monthly) would be communicated in the initial phase of negotiation.

Paying the Suppliers: Initially, suppliers would be paid on spot. Credit purchases would be made as reliable and consistent relationships buildup. Collecting the Accounts Receivable: What administrative policies, procedures, and controls will be used for collecting the accounts receivable? Will you have a separate collection department? Use a collection agency? Use factoring? Reporting to Management: Our team will maintain an informal communication process and will document weekly activities in a project diary for future reference. If and when the need for additional employees becomes apparent due to multiple projects, a more structured communication system will be instituted with report structure and procedures where the relevant project manager would be reported to. Staff Development: Training and development of staff will be beneficial to the overall efficiency of business operations. As cash flow improves, we plan to implement a budget for staff to attend select seminars and trade shows. Until then, we will make an effort to read business journals and copy interesting items for each other. Computer training, equipment training, and personal development will all be sought and encouraged by management. 30

Inventory Control: As we will be a service based company, therefore we will be purchasing items for the construction of RFID equipment only during project implementations. All costs pertaining to the construction and assembling of equipment will be paid by the client rendering no costs of goods sold. This gauges the fact that an inventory management system is unwanted and will not be needed until we initiate high scale projects. Handling Warranties and Returns: Our product is not something that can be returned. We do stand behind our work. If through our mistake or oversight, a client does not achieve the desirable results (foretold, detailed, documented results related to security, automation, efficiency); we will exert all effort to achieve them at our expense, which will exclude the client from paying any service charges (only). In this regard, our CTO will be directly handling complaints and will design solutions to the stated problems. An annual satisfaction and feedback survey program will also assist Tech Horizon to provide an improved level of services in the future.

Monitoring the Company Budgets: Budgets will be prepared quarterly to determine benchmarks for:  Revenue  Sales and Marketing Expenses  Administrative Expenses  General Expenses  Capital Expenditures The budgets will be used to establish benchmarks and then to review actual performance against the benchmarks. An accountant will be hired to do the bookkeeping and prepare a monthly analysis for Mr. Y and Mr. X who will then evaluate the need for modifications or adjustments in spending. Security Systems: We are not overly concerned with physical security as we have no inventory and our equipment is minimal. Our main security concern is client information. As such, establishing a password system for each client’s computer files is in the works.

Documents and Paper Flow: . The major documents identified are the ones related to: 31

 Recruitment, salary and compensation  Agreements with clients  Purchases, agreements with suppliers  Marketing expenses  Miscellaneous expenses As we grow and have more personnel and clients to deal with, a more formal Paper work system will be put into place.

Planning Chart Product/Service Development The RFID prototype has been developed by the Tech Horizon Team which would be moulded accordingly to meet the client’s requirements as soon as an agreement/contract is signed by both parties and all paperwork/formalities are dealt with. The duration of a project depends on the client’s requirements. Manufacturing We are not a manufacturer. Our output is a system consisting of both hardware and software of which the software is created by our programmers while the hardware is the result of assembling parts bought from Noida at the STPI Noida, LOGIX Techno Park - Sec- 127, Expressway, Noida, As implementations of RFID vary to a great extent, it is difficult if not impossible to systemize the process other than to require that it occur on time. Financial Requirements We have a partnership of three people who will invest Rs 100000 each amounting to Rs 300000 and rest Rs 500000 will be taken as loan from bank at the rate of 12% annually for the period of 36 month ,to pay amount of loan taken we will have to pay EMI of Rs.16600 per month for the period of 36 months

Marketing Flow Chart Our marketing materials are under development. Mr. Y is responsible for the marketing activities with the help of the Mr. X as needed. Refer to the Marketing section under Advertising and Promotions for a timeline of marketing efforts.

32

Technology Plan As we are an enterprise completely reliant on technology, it is an offbeat requirement to always stay in touch with the latest developments in tracking technology and its applications. This also includes developing systems that are free of bugs, more efficient than predecessors and compatible with almost all the variety of computer systems. This is one of the reasons why we will be using unbranded computer systems for testing purposes, ensuring maximum compatibility. The parts to construct RFID equipment are cheap and plausibly reliable. They would be replaced if found defective. If a rare compromise on quality regarding the parts is encountered and there is a large contract/project at hand, Tech Horizon would try to import them. We will be continuously browsing for the cheapest suppliers and ways to enhance the performance of tracking equipment. The initial technology for operations consists of four unbranded computer systems along with a laser printer and one used copying machine. These systems will be connected to form a LAN in order for better resource sharing among the team. We plan to access the internet through a reliable dialup connection. If business demands faster access, we would go for purchasing a line from the cable operator of the vicinity. Primary methods of communication would be through email and phone. Tech Horizon’s website is currently under construction and will be hosted on the internet through a local ISP, which would charge an annual fee. It would contain background information on the company and the services that we are willing to provide. This will enable extended access to potential clients and will allow a broader means of communication. We plan to update the website on a monthly basis and include all the recent developments of our projects. All the Co Founders are technology literate and there will be a preference for recruiting technology literate employees.

Management Management Team: All the three members are having Bachelor’s Degree in Technology. The CEO, Mr. X, who is also having Masters Degree in Business Administration and five years of experience in system integration field ,will be in charge of day-to-day operations in conjunction with formulating 33

project dependencies, and programming for the project modules required by the clientele. Rest two members are also expertise in the field of computer programming and embedded systems

Organizational Chart:

Development/Growth Plan New Offerings to Market Attractive growth opportunities in the law enforcement and military sectors await the implications of RFID. Tech Horizon can actively participate in constructing tracking systems useful for elimination in crime & terrorism, assisting the local police and enhancing military communication and coordination. Such an ambition of course requires resources, contacts and reputation in order for it to be sought. Other opportunities include the introduction of human tracking. Although this technology function has been mired with criticism and issues related to 34

privacy, it provides cheap opportunities pertaining to safety of the public. In a much broader sense, it would assist the eradication of crimes, especially those related to kidnapping, ensuring the safety of citizens. Such an implementation, of course needs a large infrastructure, therefore the only viable option is to provide such a service is through a consortium or a client/corporate entity that has a large infrastructure and is willing to share/finance the costs. Expansion to a Product Base Initially, Tech Horizon would be creating modules according to the needs of the customer. As the business expands and as we gain experience and awareness about the various needs of the different clients we serve in our targeted industries, expanding ourselves to a product base would be a logical step. To be more elaborate, we plan to develop specific standardized modules that would be an amalgamated solution to the needs that we would have encountered from past experiences and thus could be used by all the targeted players of a specific market. We plan to expand after at least five years of operations as a service based solutions provider. Merger with another Solutions Provider We are exploring the possibilities of adding a division that would be research oriented. The formation of this division might be accomplished through merging with another firm, particularly another software house or solutions provider. A merger would also support our efforts of increasing the quality and dynamism in our product/service offerings and will also help widen the customer base dramatically. International Customers The company will start offering services regionally when it has gained substantial experience and resources to cater to a wider array of business solutions pertaining to RFID and is able to meet global standards and expectations. This option will be pursued at least 6-7 years after startup, when the business has become highly profitable and proficient in providing services. Capital Requirements The company would start with the injection of funds equivalent to at least Rs. 800000. To support the above mentioned growth activities, the need for additional funds would have to be fulfilled. These funds will be preferred to be sought through sale of existing equity, going public and lastly, debt. Personnel Requirements The management team included in this plan is sufficient to incorporate additional growth but it would be different in a scenario where a large or multiple contracts are agreed upon. In such cases, subcontractors and outsourcing would be a large part of consideration. Additional personnel requirements would include professionals of IT and Finance with significant experience in project management and cost analysis respectively..

35

Financial Plan Sales Projections Sales are projected as follows: 2009 - Rs. 770,000 2010 - Rs. 1340000 2011 - Rs. 1955000 We project to perform at least three projects in the first year out of which two would be of a miniature scale and one would be of an intermediate implementation. The sources of sales would be the fees for the feasibility studies and the implementations. The second year consists of one miniature and two intermediate projects while the third year would comprise of two intermediate and two miniature scale projects. Income Projections Net income projections are as follows: 2009 - Rs. (163,900) 2010 - Rs. 452168 2011 - Rs. 1029912 Cash Requirements The business needs at least Rs. 800000 for business establishment and commencement of operations and liquidity support . Sources of Financing We have a partnership of three people who will invest Rs 100000 each amounting to Rs 300000 and rest Rs 500000 will be taken as loan from bank at the rate of 12% annually for the period of 36 month ,to pay amount of loan taken we will have to pay EMI of Rs.16600 per month for the period of 36 months

36

START UP FUNDING & EXPENDITURES START-UP CASH Equity investments Loan proceeds Real estate loans TOTAL START-up CASH

AMOUNT(Rs.) 3,00,000 5,00,000 8,00,000

START-UP EXPENDITURE Security deposits Rent Telephone deposits Total security deposits

5,000 2,000 7,000

START-UP EXPENSES Legal & consultancy fees Meals & entertainment Office supplies Printing (cards, brochures etc.) TOTAL START-UP EXPENSES

3000 3,000 15,000 15,000 43,000

CAPITAL EXPENDITURES Computer equipment Testing Equipment machinery Furnitures & fixtures Vehicles TOTAL START-UP CAPITAL EXPENDITURES TOTAL START-UP EXPENDITURES

37

89,200 15,000 35,000 1,35,000 2,74,200 3,17,200

PROJECTED CASH FLOW STATEMENTS FOR NEXT THREE YEARS YEAR I PARTI CULA RS Cash In Cash receive d from clients( excludi ng hardwa re cost) Equity Receiv ed Loans Receiv ed TOTAL CASH IN CASH OUT Advertis ing Licens e& Fees Marketin g& Promoti on Meals & Enterta inment Office Expens es Office Supplie s Outsid e Service s Salarie s& Wages Profess ional fees Shippi ng & deliver y Repair s& Mainte nance

Pre startup

JAN

FEB

MAR

APR

MAY

JUN

JUL

AUG

SEP

OCT

NOV

DEC

TOTAL

-

-

-

-

-

15,000

40,000

50,000

1,35,00 0

35,00 0

1,65,0 00

1700 00

1,60, 000

7,70,00 0

3,00,00 0

-

-

-

-

-

-

-

-

--

-

-

-

3,00,00 0

5,00,00 0

-

-

-

-

-

-

-

-

-

-

-

-

5,00,00 0

8,00,00 0

-

-

-

-

15,000

40000

50000

135000

35,00 0

16500 0

1700 00

1600 00

14,26,0 00

-

-

-

-

-

-

-

-

60000

--

-

-

6000

66,000

3000

-

-

-

-

-

-

-

-

-

-

-

-

2,500

15,000

-

-

50,000

20,0 00

-

-

-

-

-

-

-

-

85,000

3,000

-

-

-

-

-

-

-

-

-

-

-

-

3,000

-

-

-

500

500

500

500

500

500

500

500

500

500

5,000

15,000

-

-

-

-

-

-

-

-

-

-

-

-

15,000

-

-

-

-

-

2,000

-

-

-

2,000

-

-

-

4,000

-

-

-

-

33,0 00

33,000

33,000

33,000

33,000

33,00 0

33,000

33,00 0

33,00 0

2,97,00 0

-

-

-

1,700

1,70 0

1,700

1,700

1,700

1,700

1,700

1,700

1,700

1,700

17,000

-

-

-

-

-

-

250

-

-

-

250

-

-

500

-

-

-

600

600

600

600

600

600

600

600

600

600

6,000

38

Telepho ne Trainin g& Develo pment Rent

2000

2 000 -

2000

2,000

-

4,000

5 ,00 0 8 ,00 0

5,000

Utilitie s/ Travelli ng Vehicle

8,000

-

Capital Purcha ses Monthl y EMI

2,74,20 0

TOTAL CASH OUT MONT HLY CASH FLOW (CASH IN – CASH OUT)

3,25,20 0

-

5,000

-

474800

2,00 0 4,00 0

1,200

1,200

1,200

1,200

-

-

-

-

5,000

5,00 0

5,000

5,000

5,000

8,000

8,000

8,00 0

8,000

8,000

-

-

1,000

1,000

-

-

-

2,00 0 -

16,60 0

16,600

31,60 0 (3160 0)

1 6,6 00 3 1,6 00 (316 00)

1,200

1,200

1,200

14,600

-

-

-

-

8,000

5,000

5,000

5,000

5,000

5,000

60,000

8,000

8,000

8,000

8,000

8,000

8,000

94,000

2,000

1,000

2,000

1,000

2,000

1,000

2,000

15,000

-

-

-

-

-

-

-

-

16,6 00

16,600

16,600

16,600

16,600

16,60 0

16,600

16,60 0

16,60 1,99,200 0

89400

9340 0

69,400 68,850

128600

6960 0

68850

6785 0

74850 1166000

(89400)

(934 00)

(54400 (28850) )

6400

(3460 0)

96150

1021 50

9515 0

39

67,550 (17550 )

1,200

2,74,200

260000

YEAR II PARTICULAR S Cash In Initial cash balance

Cash sales

TOTAL CASH IN CASH OUT Operating Expenses Advertising License & Fees Marketing & Promotion Meals & Entertainment Office Expenses Office Supplies Outside Services Salaries & Wages Professional fees Shipping & delivery Repairs & Maintenance Telephone Training & Development Rent Utilities/travell ing

JAN

FEB

MAR

APR

MAY

JUN

JUL

AUG

SEP

OCT

NOV

DEC

TOTAL

1,05 ,000

1,35,0 00

1,70,0 00

2,35,0 00

20,00 0

60,00 0

70,00 0

90,00 0

1,00,0 00

1,25,0 00

75,00 0

1,55,0 00

13,40,000

3,65 ,000

1,35,0 00

1,70,0 00

2,35,0 00

20,00 0

60,00 0

70,00 0

90,00 0

1,00,0 00

1,25,0 00

75,00 0

1,55,0 00

16,00,000

-

-

-

20,000

-

-

-

-

-

-

-

30,000

-

-

-

-

-

-

-

-

-

-

-

10,00 0 -

500

500

500

500

500

500

500

500

500

500

500

500

6,000

600 2,00 0 33,0 00 1,70 0 -

600 -

600 -

600 -

600 2,000

600 -

600 -

600 -

600 -

600 -

600 -

600 -

7,200 4,000

33,00 0 1,700

33,00 0 1,700

33,000

33,00 0 1,700

33,00 0 1,700

33,00 0 1,700

33,000

33,000

1,700

1,700

33,00 0 1,700

33,00 0 1,700

3,96,000

1,700

33,00 0 1,700

250

-

-

-

250

-

-

-

-

-

-

500

600

600

600

600

600

600

600

600

600

600

600

600

7,200

1,20 0 -

1,200

1,200

1,200

1,200

1,200

1,200

1,200

1,200

1,200

1,200

1,200

14,400

-

-

-

-

-

-

-

-

-

-

-

-

5 000 8,00 0

50000

5000

5000

5000

5000

5000

5000

5000

5000

5000

5000

60,000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

96,000

2 600 00

40

-

20,400

Vehicle Monthly EMI TOTAL CASH OUT CASH FLOW (CASH IN – CASH OUT)

1,00 0 16,6 00 70,2 00 2,94 ,800

2,000

1,000

2,000

1,000

2,000

1,000

2,000

1,000

2,000

16,60 0 69,45 0 65,55 0

16,60 0 70,20 0 99,80 0

16,600

16,60 0 72,20 0 (52,20 0)

16,60 0 71,35 0 (11,35 0)

16,60 0 72,20 0 (2,20 0)

16,60 0 73,20 0 16,80 0

16,600

16,600

91,200 1,43,8 00

1,000

16,60 0 72,200 71,20 0 52,800 3,800

73,200 26,800

2,000

18,000

16,60 1,99,200 0 82,20 8,88,800 0 72,800 7,11,200

YEAR III PARTI CULA RS Cash In Initial Cash balanc e Cash sales TOTAL CASH IN CASH OUT Opera ting Expen ses Adverti sing Licens e& Fees Market ing & Promot ion Meals & Enterta inment Office

JA N

FEB

MAR

APR

MAY

JUN

JUL

AUG

SEP

OCT

NOV

DEC

TOTAL

1,00,0 00

1,60,0 00

2,40,0 00

2,15,00 0

2,40,00 0

1,05,0 00

2,10,00 0

1,90,00 0

2,25,00 0

1,35,0 00

1,20,00 0

19,55, 000

1,00,0 00

1,60,0 00

2,40,0 00

2,15,00 0

2,40,00 0

1,05,0 00

2,10,00 0

1,90,00 0

2,25,00 0

1,35,0 00

1,20,00 0

26,81, 200

-

50,000

-

-

-

-

-

-

-

-

-

-

50,000

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

20,000

-

-

-

-

-

-

20,000

-

-

-

-

-

-

-

-

-

-

-

-

-

50

500

500

500

500

500

500

500

500

500

500

500

6,000

7 ,11 ,20 0 1 5,0 00 7 ,26 ,20 0

41

Expens es Office Supplie s Outsid e Service s Salarie s& Wages Profess ional fees Shippi ng & deliver y Repair s& Mainte nance Teleph one Rent Utilitie s/trave lling Vehicle Other Monthl y EMI TOTAL CASH OUT CASH FLOW (CASH IN – CASH OUT)

0 60 0

600

600

600

600

600

600

600

600

600

600

600

7,200

-

-

4,000

-

-

-

2,000

-

-

-

-

-

6,000

3 3,0 00 1 ,70 0 -

33,000

33,000

33,000

33,000

33,000

33,000

33,000

33,000

33,000

33,000

33,000

3,96,0 00

1,700

1,700

1,700

1,700

1,700

1,700

1,700

1,700

1,700

1,700

1,700

20,400

250

-

500

-

-

-

250

-

-

-

-

1,000

60 0

600

600

600

600

600

600

600

600

600

600

600

7,200

1 ,20 0 50 00 8 ,00 0 1 ,00 0

1,200

1,200

1,200

1,200

1,200

1,200

1,200

1,200

1,200

1,200

1,200

14,400

5000

5000

5000

5000

5000

5000

5000

5000

5000

5000

5000

60000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

96,000

2,000

1,000

2,000

1,000

2,000

1,000

2,000

1,000

2,000

1,000

2,000

18,000

16,600

16,600

16,600

16,600

16,600

16,600

16,600

16,600

16,600

16600

72200

67700

67650

87650

69650

68450

68200

69450

68200

69200

1 16,600 6,6 00 68,2 11820 00 0

199200 894750 178645 0

42

PROJECTED MONTHLY INCOME STATEMENT YEAR I Pre startup -

JAN

FEB

MAR

APR

MAY

JUN

JUL

AUG

SEP

OCT

NOV

DEC

TOTAL

-

-

-

-

15,000

40,000

50,000

1,35,000

-

-

-

-

-

-

-

1,70,0 00 -

7,70,0 00

-

1,65,0 00 -

16,000

-

35,00 0 -

GROSS INCOME

-

-

-

-

-

15,000

40,000

50,000

1,35,000

Advertising

-

-

-

-

-

-

-

-

3,425

3,425

PARTICU LARS NET SALES Cost of goods sold

Depreciatio n& amortization License & 2,500 Fees

3,42 5

3,425

3,425

3,425

3,425

35,00 0

1,65,0 00

1,70,0 00

-

-

-

60,000 3,425

3,425

3,425

3,425

-

-

-

-

-

-

-

-

-

-

-

-

-

160,00 0

7,70,0 00

6,000

66,000

3,425

41,100

-

Marketing & Promotion Meals & Entertainme nt Miscellaneo us

15,00 0

-

-

50,00 0

20,00 0

-

-

-

-

-

-

-

3,000

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

Office Expenses

-

-

-

500

500

500

500

500

500

500

500

500

500

5,000

Office Supplies

15,00 0

-

-

-

-

-

-

-

-

-

-

-

-

15,000

Outside Services

-

-

-

-

-

2,000

-

-

-

2,000

-

-

-

4,000

Salaries & Wages

-

-

-

-

33,00 0

33,000

33,000

33,000

33,000

33,00 0

33,000

33,000

33,000

2,97,0 00

43

-

2,500 85,000 3,000 -

Professional fees

-

-

1,700

1,700

1,700

1,700

1,700

1,700

1,700

1,700

1,700

1,700

17,000

Repairs & maintenance

-

-

600

600

600

600

600

600

600

600

600

600

6,000

Shipping & delivery

-

-

-

-

-

-

250

-

-

-

250

-

-

500

Telephone

-

-

-

2,500

2,500

1,200

1,200

1,200

1,200

1,200

1,200

1,200

1,200

14,600

Training & developmen t rent -

-

-

4,000

4,000

-

-

-

-

-

-

-

-

8,000

-

-

4,500

4,500

4,500

4,500

4,500

4,500

4,500

4,500

4,500

4,500

45,000

Utilities/trav el

-

-

8,000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

80,000

Vehicle

-

-

-

1,000

2,000

1,000

2,000

1,000

2,000

1,000

2,000

1,000

2,000

15,000

Other

30,0 00

-

-

-

-

-

-

-

-

-

-

-

-

30,000

TOTAL OPERATI NG EXPENSE S Operating Income

65,5 00

3,42 5

3,425

76,22 5

80,22 5

55,925

55,175

53,925

1,14,925

55,925

55,175

53,925

60,925

7,34,7 00

(65, 500)

(3,4 25)

(3,425)

(76,2 25)

(80,2 25)

(40,925 )

(15,175)

(3,925)

20,075

(20,9 25)

1,09,8 25

1,16,0 75

99,075

35,300

(16,60 0) (20,02 5)

(16,60 0) (20,02 5)

(16,6 00) (92,8 25)

(16,6 00) (96,8 25)

(16,600 ) (57,525 )

(16,600)

(16,60 0) (20,52 5)

(16,600)

(16,6 00) (37,5 25)

(16,60 0) 93,225

(16,60 0) 99,475

(16,60 0) 82,475

(1,99,200 ) (1,63,9 00)

-

-

-

-

-

-

-

-

-

-

-

-

-

(92,8 25)

(96,8 25)

(57,525 )

(31,775)

(20,52 5)

3,475

(37,5 25)

93,225

99,475

82,475

(1,63,9 00)

TOTAL

To loan NET INCOME

(65, 500)

Income taxes(if any) INCOME BEFORE TAXES

(65, 500)

3,475

YEAR II

JAN PARTICULAR S NET SALES 1,05,00 0 1,05,00 GROSS INCOME 0

Advertising

(20,02 (20,02 5) 5)

(31,775)

-

FEB

MAR

APR

MAY

JUN

JUL

AUG

SEP

OCT

NOV

DEC

1,35,00 0 1,35,00 0

1,70,00 0 1,70,00 0

2,35,00 0 2,35,00 0

20,000

60,000

70,000

90,000

60,000

70,000

90,000

1,25,00 0 1,25,00 0

75,000

20,000

1,00,00 0 1,00,00 0

1,55,00 0 1,55,00 0

13,40,00 0 13,40,00 0

-

-

-

-

-

-

-

-

-

-

-

44

-

75,000

Depreciation & amortization License & Fees

2,911

2,911

2,911

2,911

2,911

2,911

2,911

2,911

2,911

-

500

500

500

500

500

500

500

500

500

500

500

6,000

Office Supplies

600

600

600

600

600

600

600

600

600

600

600

600

7,200

Outside Services Salaries & Wages Professional fees Repairs & maintenance Shipping & delivery Telephone Training & development Travel Utilities

2,000

-

-

-

2,000

-

-

-

-

-

-

-

4,000

33,000

33,000

33,000

33,000

33,000

33,000

33,000

33,000

33,000

33,000

33,000

33,000

1,700

1,700

1,700

1,700

1,700

1,700

1,700

1,700

1,700

1,700

1,700

1,700

3,96,00 0 20,400

600

600

600

600

600

600

600

600

600

600

600

600

7,200

-

250

-

-

-

250

-

-

-

-

-

-

500

1,200 -

1,200 -

1,200 -

1,200 -

1,200 -

1,200 -

1,200 -

1,200 -

1,200 -

1,200 -

1,200 -

1,200 -

14,400 -

4,500 8,000

4,500 8,000

4,500 8,000

4,500 8,000

4,500 8,000

4,500 8,000

4,500 8,000

4,500 8,000

4,500 8,000

4,500 8,000

4,500 8,000

4,500 8,000

54,000 96,000

Vehicle Other TOTAL OPERATING EXPENSES Operating income

1,000

2,000

1,000

2,000

1,000

2,000

1,000

2,000

1,000

2,000

1,000

2,000

18,000

56,011

55,261

54,011

75,011

56,011

55,261

54,011

55,011

55,011

54,011

65,011

6,88,63 2

48,989

79,739

1,15,98 9

1,59,98 9

(36,011 4,739 )

15,989

34,989

45,989

69,989

20,989

89,989

6,51,36 8

(16,600 ) NET INCOME 32,389

(16,600 ) 63,139

(16,600 ) 99,389

(16,600 ) 29,389

(16,600 ) 53,389

(16,600 ) 4,389

(16,600 ) 73,389

(1,99,200

-

(16,600 ) (11,861 ) -

(16,600 ) 18,389

-

(16,600 ) (52,611 ) -

(16,600 ) (611)

Income taxes(if any) 32,389 INCOME BEFORE TAXES

(16,600 ) 1,43,38 9 -

-

-

-

-

-

-

-

63,139

99,389

1,43,38 9

(52,611 )

(11,861 )

(611)

18,389

29,389

53,389

4,389

73,389

4,52,168

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

10,000

-

-

-

-

-

-

-

34,932

Marketing & Promotion Meals & Entertainment Miscellaneous Office Expenses 500

20,000

-

2,911

-

-

2,911

-

To loan

-

2,911

54,011

30,000 -

4,52,168

YEAR III PARTICULA RS NET SALES GROSS INCOME

JAN

FEB

MAR

APR

MAY

JUN

JUL

AUG

SEP

OCT

NOV

DEC

15,0 00 15,0 00

1,00,00 0 1,00,00 0

1,60,00 0 1,60,00 0

2,40,00 0 2,40,00 0

2,15,00 0 2,15,00 0

2,40,00 0 2,40,00 0

1,05,00 0 1,05,00 0

2,10,00 0 2,10,00 0

1,90,00 0 1,90,00 0

2,25,00 0 2,25,00 0

1,35,00 0 1,35,00 0

1,20,00 0 1,20,00 0

45

TOTAL 19,55,00 0 19,55,00 0

Advertising 2,47 Depreciation & amortization 4 License & Fees Marketing & Promotion Meals & Entertainment Miscellaneous Office Expenses Office Supplies Outside Services Salaries & Wages Professional fees Repairs & maintenance Shipping & delivery Telephone Training & development Travel Utilities

50,000 2,474

2,474

2,474

2,474

2,474

2,474

2,474

2,474

-2,474

2,474

2,474

50,000 29,688

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

20,000

-

-

-

-

-

-

-

-

-

-

-

-

-

500

500

500

500

500

500

500

500

500

500

500

500

6,000

600

600

600

600

600

600

600

600

600

600

600

600

7,200

-

-

4,000

-

-

-

2,000

-

-

-

-

-

6,000

33,0 00 1,70 0 600

33,000

33,000

33,000

33,000

33,000

33,000

33,000

33,000

33,000

33,000

33,000

1,700

1,700

1,700

1,700

1,700

1,700

1,700

1,700

1,700

1,700

1,700

3,96,00 0 20,400

600

600

600

600

600

600

600

600

600

600

600

7,200

-

250

-

500

-

-

-

250

-

-

-

-

1,000

1,20 0 -

1,200

1,200

1,200

1,200

1,200

1,200

1,200

1,200

1,200

1,200

1,200

14,400

-

-

-

-

-

-

-

-

-

-

-

-

4,50 0 8,00 0

4,500

4,500

4,500

4,500

4,500

4,500

4,500

4,500

4,500

4,500

4,500

54,000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

8,000

96,000

2,000

1,000

2,000

1,000

2,000

1,000

2,000

1,000

2,000

1,000

2,000

18,000

1,04,82 4

57,574

55,074

53,574

74,574

55,574

54,824

54,574

53,574

54,574

7,25,88 8

(4,824)

1,02,42 6

1,84,92 6

1,61,42 1,65,426 6

49,426

1,55,17 6

1,36,42 6

1,70,42 6

81,426

65,426

12,29,112

1,00 0 Other 53,5 TOTAL OPERATING 74 EXPENSES (38,5 Operating income 74) Vehicle

20,000

53,574

To loan

(16,6 00)

(16,600 )

(16,600 )

(16,600 )

(16,600 )

(16,600 )

(16,600 )

(16,600 )

(16,600 )

(16,600 )

(16,600 )

(16,600 )

(1,99,200

NET INCOME Income taxes (if any?) INCOME BEFORE TAXES

(55,1 74) -

(21,424 ) -

85,826

1,68,32 6 -

1,44,82 6 -

1,48,82 6 -

32,826

1,38,57 6 -

1,19,82 6 -

1,53,82 6 -

64,826

48,826

-

-

10,29,91 2 -

(55,1 74)

(21,424 )

85,826

1,68,32 6

1,44,82 6

1,48,82 6

32,826

1,38,57 6

1,19,82 6

1,53,82 6

64,826

48,826

-

-

PROJECTED INCOME STATEMENT (YEAR END)

PARTICULARS

I YEAR

II YEAR 46

III YEAR

10,29,91 2

(RS.) Net sales(less returns & allowances) Cost of goods sold GROSS INCOME Operating expenses Advertising Depreciation & amortization License & fees Marketing & promotion Meals & entertainment Office expenses Office supplies Outside services Salaries & wages Professional fees Repairs & maintenance Shipping & delivery Telephone Training & development Rent Utilities/Travel Vehicle Other Repayment of loan TOTAL OPERATING EXPENSES INCOME BEFORE TAXES Income taxes (if any) NET INCOME

7,70,000

13,40,000

19,55,000

-

-

-

7,70,000

13,40,000

19,55,000

66,000 41,100

34,932

50,000 29,688

2,500 85,000

30,000

20,000

3,000

-

-

5,000 15,000 4,000 2,97,000 17,000 6,000

6,000 7,200 4,000 3,96,000 20,400 7,200

6,000 7,200 6,000 3,96,000 20,400 7,200

500

500

1,000

14,600 8,000

14,400 -

14,400 -

45,000 80,000 15,000 30,000 1,99,200

54,000 96,000 18,000 1,99,200

54,000 96,000 18,000 1,99,200

9339000

887832

925088

(1,63,900)

4,52,168

10,29,912

-

-

-

(1,63,900)

4,52,168

10,29,912

47

INTEREST ON BANK LOAN STATE BANK OF INDIA @ 12% : Calculated Monthly EMI

16600

Annual EMI

199200

Total Amount with Interest

597857

Total Interest Amount

97857

Yearly Interest Amount

32619

Bibliography •

Data Protection Working Party. Working document on data protection issues related to RFID technology. EU 10107/05/EN WP 105, January 2005. www.europa.eu.int/comm/internal_market/privacy/docs/ 48

• • • • • • • •

wpdocs/2005/wp105_en.pdf Gildas Avoine. Adversarial model for radio frequency identification. Cryptology ePrint Archive, Report 2005/049, 2005. eprint.iacr.org Book Industry Study Group. BISG Policy Statement. www.bisg.org/docs/BISG_Policy_002.pdf, September 2004. Jerry Brito. Relax, don’t do it: Why RFID privacy concerns are exaggerated and legislation is premature. UCLA Journal of Law and Technology, 8(2), Fall 2004. www.lawtechjournal.com/articles/2004/05_041220_brito.pdf. Ann Cavoukian. Tag, you’re it: Privacy implications of radio frequency identification (RFID) technology. www.ipc.on.ca/scripts/index_.asp?action=31&P_ID=15007, February 2004. Vinod Chachra and Daniel McPherson. Personal privacy and use of RFID technology in libraries. White Paper, VTLS Inc., www.vtls.com/documents/privacy.pdf, October 2003. The Icfai University Journal of Supply Chain Management, Vol. 6, No. 1, pp. 60-77, March 2009 http://ssrn.com/abstract=1266019

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