Marketing Management on Bio Diesel for New Product Development

13th Nov 2011

Sir. Sumair YounasFederal Urdu UniversityArts Science & TechnologyKarachi.

Letter of Thanks

Sir,

We are pleased to complete this report and feel pleasure that we have successfully launched a new product.

We have chosen a bio diesel product as this named also a project name. As per your guideline this report covers all the authentic area of concern and contains all the relevant information.

We would like to say thanks for the faith you showed in our capabilities and the encouragement you gave us on assigning the report. If there is anything else you wish to know, we will be glad to assist you.

Regards,

Shoaib HassanAisha NaeemAdeel BaigAsad-ul-HaqFarhan Shaikh

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TABLE OF CONTENTS

Page #

1-Introduction 4

2-Objectives Of Report 5

3-Mission Statement 5

4-Scope of Proposed Business 6

5-Limitation of Proposed Business 6

6-Company Profile 7

7-Target Client Size 7

8- Marketing Strategy 8

9-Staff Training And Developement 8

10-Proposed Location 9

11- Land Area 9

12- Marketing 9

13- Proposed Equipment/Machinery 10

14-Proposed Facilities 11

15- Present Population to be served 11

16- Direct Benefits 11

17- Direct Benefits 11

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TABLE OF CONTENTS

18- Administrative and Managerial Hierarchy 12

19-Site Map 13

20- Total Time Required 13

21- Total Estimated Cost 14

22- Office Furniture 14

23- Annual Requiring Expenses 15

24- Graphical Presentation 15

25- Expected Profit Projection 16

26- Loan 16

27- Contingency Plan 16

28-Conclusion 17

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1. INTRODUCTION

This Product is related with the New Oil Product Named “BIO DIESEL”. Basically it is a Alternative Product of Diesel fuel. Due to huge consumption of Diesel in Pakistan. We decided to introduce the product, which is produced by a chiness plant Jatropha. Which can be easily cultivated.

Bio diesel is easy to use with the ratio of 3:2. We use with the mixture of 40% diesel oil& 60% diesel without any refinery system or process. It is helpful to control global warming.. The physical and chemical properties of bio diesel are similar to those of petroleum diesel, the application of Bio diesel Range from transport Vehicle to farming equipment to industrial machinery.

Bio-diesel can be used in any type of diesel engine in a blend with petroleum diesel. No engine modifications are required for blends up to 40%.

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2. Objectives of Report

It is the project of marketing management so we have decided to complete it. It will be new technology for the market in Pakistan. Through this report it will be very helpful in future to develop such kind of business in Pakistan. It is the best and cheep alternate energy when the prices of fuel is going high and Pakistan is facing very much energy crises.

3. Mission Statement

Our purpose of this business is consist on some different tasks which are as follows,

Utilization of Domestic Natural resources.

Promotion of green resources.

Cheaper infrastructure required.

Availability possible in far rural areas.

Independently use and produce bio-diesel

Controlling possible to reduce 40% diesel consumption in Pakistan.

It is very important tool to control global warming.

To save foreign exchange

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4. Scope of Proposed Business

Our Business scope is broader in the sense that we just not only want to target specific city or town, our business is for all those vehicles who uses diesel, initially we start our business from the 3 areas of Karachi named as Pipri, Sohrab goth and maripur, because here is very big trucking station of country, asia’s biggest rice godown, PSO refinery, Port and from sohrab goth all public transport goes towards other cities of country. Near this area different villages also situated so they can also use our fuel in agriculture machinery. After success of our product it will be cultivated in all over the country.

5. Limitations of Proposed Business.

As far as limitations of bio diesel are concerned, like other products it also have some limitations, like its just only be used in diesel transport, not for petrol vehicles, for making bio fuel we have to wait for Jatropha plant cultivation about for 3 months. In the situation of natural disaster like flood, our plant can be damage which will be harmful for business.

We have to compete with well known diesel, most people will think that there vehicle engine may be damage due to bio fuel and they make other people fed up from our product so we have to look towards this behavior.

Mostly people who belong to agriculture profession cultivate food and cotton product so we may face lack of land to cultivate it.

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6. Profile.

Product : Bio diesel

Address: Pipri

City: Karachi

Owner : Shoaib Hassan, Aisha Naeem, Adeel Baig, Asad-ul-Haq,

Farhan Sheikh

Production area: Gharo Sindh

Petrol pumps: Pipri ,Sohrab goth & Mari pur

Web site: www.greenbiofuel.com.pk

7. Target Client Size.

Bio diesel is currently produce in Germany, Italy, Australia, Malaysia and united states, and its most advance in U.S and Europe , which currently produce 2 billion and 1 billion liter of bio diesel per year respectively.

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In Pakistan it’s not yet started and we all know that transport sector is also very huge and have so much potential to consume bio diesel. Our target client will be,

All diesel vehicles.

Maripur, Pipri and Sohrab goth is main areas of vehicles.

Industrial Areas of karachi.

More than 2000 vehicles/day.

8. Marketing Strategy.

To penetrate in market we use two main marketing strategies, Cost Leadership and Focus. We make cheaper diesel and we focus on specific areas where its demand is so high then other areas of city which is Pipri, Maripur and Sohrab goth.

9. Staff Training and Development.

We are going to compete well known diesel fuel so we have train our staff and workers for better running of business, for this we must remember some main things which are What are the values, What clients expect when they enter in our premises, how can we create a long lasting profitable relationship with our clients. So we organize two phases of training, in first phase we train local farmers, store keepers and sales person on pumps, they will be trained by Biodiesel experts about how to store and how to use bio plant, and they also train and educate how to sale it and what prevention we should tell to customers. In second phase we give training by marketing experts to admin staffs, managers and sales persons on pumps, they will train that how to promote your product, how to communicate with peoples and how to satisfy new comers that they come again and use this new fuel.

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10. Proposed Location.

Cultivation land, stores & processing area will be Gharo city near sohra mori canal because where we have excellent quality and quantity of water but our plant does not need much water, it is near from road so we can easily deliver it without any problems.

Our offices will be near Pipri rice gowdown, and we open our fuel pumps one near office at Pipri , second one will be at sohrab goth and third one will be near maripur trucking station.

11. Land Area.

Gharo, Cultivation Area 20 Hector.

Stores and Processing 1 Hector.

Fuel pumps 3* 1000 Sq. yards.

Office 200 Sq.yards.

12. Marketing.

For the marketing of our product we initially use three ways, let the information go to people about alternate energy.

Print Media

Print media is the oldest and very authentic medium for marketing, if an add print on it whenever it be seen the advertisement do its work, news paper are still read out in whole country, literate and illiterate both read as per their respective language which they feel comfort to read, pamphlets are also distributed to target places.

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Camping

Camping is also very meaningful way for advertisement, we stall camps on target places on our pumps, because there are most target customers. We educate them and try to give them knowledge in their own language.

Social Contacts

Social contacts also helps in giving awareness to peoples, we also use our social contacts to increase sale of our product.

13. Proposed Equipment/ Machinery.

For our cultivation process, making bio diesel till selling it to final consumer we need some machinery or equipment which are as follows,

Harvester. Tractors.

Oil Extraction Machine

6 Fuel Dispensers.

3 Generators for pumps.

10 Computers

Furniture

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14. Proposed Facilities.

For enhancing sale and to promote our product we will give some facilities to our valuable customers that we will give them free oil for their vehicles and free oil change service on every 1000 liter refill of our biodiesel. We will also open Complain and information center on our every pumps.

15. Present Population to be served.

As per toll plaza and trucking station survey approx 3 million vehicles travel from their so these are our target to serve them.

16. Direct benefits.

As we Initialize this product so we are initial Promoters and if we success we will have big market share, it will gives growth to our business and the main direct benefit will be the profitability which is the core purpose of business.

17. Indirect benefits.

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Indirect benefit of our product is to reduce Global warming, by making in our own country upto 40% it helps to save foreign exchange and when it grows it increase employment.

18.Administrative and Managerial Hierarchy.

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19. Site Map.

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Our main office and pump is near pipri, a rural area in the ended of Karachi city, our agriculture farm is also near this area, so its site map is as follows,

20. Total Time Required.

Our bio diesel plant Jatropha curcus needs 3 months for its cultivation, and in this time we can establish our pumps, offices and stores and after three months we can launch our product

21. Total Estimated cost.

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Land Rs. 5000/ Hector * 20 Hec = Rs.100, 000 for 6 months

Rent of tractors , harvestor and generators= Rs. 100,000 as above

Oil Extraction Machine= Rs. 400,000

Oil Tanker (rent)=Rs. 150,000.

Oil dispenser= Rs.1200,000.

10 Computers= Rs. 300,000.

Furniture & Renovation= Rs.10,00,000.

Rent of Pumps= Rs. 150,000.

Marketing=Rs. 500,000

Total Cost= Rs. 3900,000/

22. Office furniture.

For our business we need some furniture which are usually traditional type.

Chairs

Tables.

Cupboards.

Lockers

Sofa sets

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23. Annual Recurring Expenses.

Salaries Expenses = 170, 000

Utility Bills = 200,000

Other Expenses= 130,000

Total Expenses= Rs. 500,000 * 12 = 6,000,000

24. Graphical Representation.

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25. Expected Profit Projection.

Our Bio diesel plant Jatropha curcuse can produce 4,536 liter/ hector oil, so if we calculate it on 20 hectors it will shows following figures.

4,536 liter/ hector * 20 = 90,720 liters.

Our Cost of Bio oil = 15/ liter

Market Price of Bio Oil = 45/ liter

Biodiesel Price = 56.5 + 18 = 74.5/ liter

G.Profit will be 30 *90,720 = Rs. 2,721,600

G.Profit for Year *4 = Rs. 10,886,400

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26. Loans.

Our 5 Partners initial own Investment = 2.5 million

We will take Commercial Loan from Bank = 1.8 million

Total Investment = Rs. 4.3 million

27. Contingency Plan.

Our contingency plan is that if we fail in our project, we will supply our oil to farmers on their door to door step for their agricultural machinery to minimize their cost of production.

CONCLUSION

Bio diesel is a clean burning alternative fuel produced from domestic resources. bio diesel will not only provide energy security but also make the dream of green Pakistan.

Currently the use of bio diesel is nothing, and this is a very new thing happening in Pakistan. Every new happening thing has to face some barriers which have to be managed and reduced efficiently.

We produce bio diesel from a plant seeds which are easily cultivated in Pakistan.we produce oil from that seeds and oil can be used with 60% normal diesel . its introducing price is just Rs. 74.5/liter and after success it will be available on every petrol pumps of Pakistan.

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ThanksPage | 19