school business model

EXCEL

INTERNATIONAL

Introduction The proposed business plan is that of an education and research institute to be named The Learning Tree education and research institute. It is a private company ownership by Excel International with principal shareholders mentioned. The capital requirement will be roughly INR 100 crores. It is very much evident that in India there is no primary academic institution and no

research institutes at the level of schooling itself. There are various impediments of Indian education system that are talked about but never acted upon. This business plan seeks to be a

revolution in the field of education as its purpose is not to impart just a theoretical knowledge but a practical one. This school is affiliated and adopted by Harvard University and aims at education

that recognizes individual’s talents and promotes children in the field of interest.

This is highlighted in the motto of school “Be the best, strive to learn and make your field an art. ”

Name of the Business: Excel International Address: Near Rajhans Circle

Airport Road Pune-422002

Nature of Business: Education and Research Institute Statement of Confidentiality: The contents of this business plan and any attachments are confidential and are intended solely for addressee. The information may also be legally privileged. This transmission is sent in trust, for the sole purpose of delivery to the intended recipient. If you have received this transmiss ion in error, any use, reproduction or dissemination of this transmission is strictly prohibited. If you are not the intended recipient, please immediately notify the sender by reply e-mail or phone and delete this message and its attachments, if any.

EExxeeccuuttiivvee SSuummmmaarryy Organizational Plan: The following organizational plan has been proposed

Form of ownership: A Private Limited Company

Authority of principal owners: The principal owners will have the absolute ownership and decision

right when it comes to election of any sub body to be incorporated. The owners reserve the right to expand or shrink the existing board with a consensus of 2/3 majority. However the founder

directors are not covered under this criterion. The founder directors are also given veto powers for decisions they deem unfit on reasonable basis. However in case of a veto power conflict the

decision rights will be reserved by the first signatory being the primary Founder.

Roles and Responsibilities of members of organization:- Responsibility of board: It will be one of the primary responsibilities of the board to provide the organization with the required infrastructure and competent staff. Besides this the board is required to meet once each

month to review the progress of the institution. Furthermore it is hereby mandatory for every board member to devote the time as may be required for the betterment of the institute. The

board shall appoint the director, principal and the various department heads with the consult of whom further members of the institute shall be appointed.

Responsibility of the Director and faculties:

Director and the faculties will have the primary role in running of the enterprise. They are hereby brought to a notice that children of the institute shall be given the utmost priority and the grievances of every child should be catered to. For the purpose of both psychological and mental development each department head will be provided with an assistant and a counselor who shall act as a single window mentor for every child in the institute. Responsibility of children: Children in this institute are given primary importance. They however must obey the rules of discipline. They will respect and obey the code of conduct that will be given to them on admission. All children are notified that any attempt of bullying or any other misconduct with respect to ethics of this institute will be dealt strictly. Any child proved violating the standards of this institute will be liable to get expelled immediately. Responsibility of parents/Guardians: We at this institute try to imbibe in children various aspects of life. We believe that our children

will be the pioneers in their respective field and will hold the standards for others to follow. This begins however with their learning at home. We aim to teach children to be empathetic and

sensitive to the needs of not only their immediate family but the entire world. Parents are therefore requested to cooperate in their development. It will be the responsibility and right of

every parent to review the performance of their ward and consult the respective faculty for there development. Parents are however advised and requested to not force any field on their children.

This is tailor made institute for every child on their interests and aptitude.

OOrrggaanniizzaattiioonnaa ll hhiieerraarrcchhyy

BOD headed by CEO

Board of School Principals

Head of Departments

Faculties

Student Representatives Board

IInndduussttrryy AAnnaallyyssiiss

The Indian education industry is poised for growth. This sector is changing rapidly with more

private players entering the field. The government is also taking many measures to improve the

quality of education in India.

Fifty percent of India's population is the youth. This means that the Indian education sector is huge

with a population of 1.13 billion. India has around 367 universities, 18,000 colleges, about half a

million teachers, and 11 million pupils. The private education industry is estimated to be between

20,000–25,000 crores. There are about 1,500 management institutes, 3,500 engineering institutes,

and 1,200 medical colleges in the country.

The Indian education sector can broadly be classified as such:

1. K-12 and HEI: The term K-12 stands for kindergarten plus 12 years of schooling. Children enter kindergarten at age 3 and after spending two years in kindergarten, continue on to 12 years of schooling before he/she is ready for higher education. The higher education institutes (HEIs) then take over providing undergraduate, graduate and vocational level university education.

2. Public education and private education: The Government of India allocates a percentage of its annual budget to the education sector and operates educational institutes. More than

90% of the government’s spend on public education flows into K-12 level education. In addition to government-run public schools, private investment in the education sector is

seen traditionally in the form of not-for-profit trusts that operate private educational institutes.

3. Formal and non-formal education: The formal education system in India broadly comprises the K-12 and HEI level education, which falls under the purview of the Ministry of Human

Resource Development (HRD). The non-formal education segment includes pre-schools (1.5-3 years), coaching classes, multimedia/IT to schools and colleges, vocational training

and the books market.

Status of education in India

The typical Indian classroom was once characterized by students sitting through hour-long

teacher monologues. Now, technology is making life easier for both students and

educators. Schools are increasingly adopting digital teaching solutions to engage with a

generation of pupils well-versed with the likes of PlayStations and iPads, and trying to make

the classroom environment more inclusive and participatory

Smartclass from Educomp Solutions, one of the first Indian companies in this space.

Smartclass is essentially a digital content library of curriculum-mapped, multimedia-rich, 3D

content. It also enables teachers to quickly assess how much of a particular lesson students

have been able to assimilate during the class. Once a topic is covered, the teacher gives the

class a set of questions on a large screen. Each student then answers via a personal

answering device or the smart assessment system. The teacher gets the scores right away

and based on that, she repeats parts of the lesson that the students don’t appear to have

grasped.

Last week, the Annual Status of Education Report (ASER) published by the non-profit

Pratham Education Foundation reported some disturbing findings about the state of education in rural India, which still accounts for a little under 70% of India’s population of 1.2 billion. The findings essentially told us two things. The good news is that enrolment in elementary education is almost 100%. The bad news is that the education outcomes, as

measured by abilities in reading, writing and doing maths, have deteriorated among children between the ages of six and 14. The bottom line is that India has a crisis of

learning. This obviously has grave implications for the future of an economy that was looking to harvest its demographic dividend, leave alone the circumstances of a social crisis

being created by generating an army of semi-literate people unable to take advantage of the new economy.

Year-wise growth of students enrolment in India

20.3 million students were enrolled in India during FY12.

University mix in India

There has been a significant increase in the share of the private universities as part of total

universities from 5 per cent in 2008-09 to 19 per cent in 2011-12.

MMaarrkkeettiinngg PPllaann::

Marketing Newspaper cm page rate/sq cm Circulation cost Education Times 20x20 any page 1850 740000 (Mumbai + Pune + Nagpur + Ahmedabad +

Baroda)

Hindu 20x20 front page 805 315350 322000 (Andhra Pradesh) The Indian Express 20x20 back page 909252 506000

(Delhi & Kolkata) 1568000

Marketing Radio Pune per 10 sec reach frequency no. of hrs days length cost

My FM 500 420000 4/hr 6/day 5/week 30sec 90000

Radio City 400 434000 4/hr 6/day 5/week 30sec 72000

Radio Mirchi 700 719000 4/hr 6/day 5/week 30sec 126000

Radio One 350 396000 4/hr 6/day 5/week 30sec 63000

Red FM 350 395000 4/hr 6/day 5/week 30sec 63000

Total 414000

AAsssseessssmmeenntt ooff rriisskk In the process of identifying the major roadblock the foremost is that of capital. Ours being an entirely new enterprise, chances of getting capital is not that bright at face. Therefore in a scenario where we are unable to get the required capital we have a contingency plan where we will be shifting the construction and reducing the amenities to be given. We however plan to retain our

concept and faculties which is the unique selling point. The detail contingency plan has also been hereafter given in financials. SWOT analysis for further details has been provided on the next page.

One of a kind

Foreign affiliations

Offers research Opportunities

No international Requirements

Training and internship

Teaching and brainstorming

By bests in respective fields

Huge capital requirement

Heavy working capital

Managing faculties

Cross cultural challenges

Increasing demand

More practical approach

Mirror behavior

Parents want best for their

Children

Fascination with foreign

Universities

Concept does not click

Takeover by a established Institution

Children not ready to adopt

FFiinnaanncciiaall PPllaann

Excel International

FINANCIAL STATEMENT

1 COST OF PROJECT

2 PROJECTED PROFIT AND LOSS ACCOUNTS

3 PROJECTED BALANCE SHEETS

4 PROJECTED CASH FLOW STATEMENT

5 PROJECTED D.S.C.R AND PROFITABILITY STATEMENT

6 SCHEDULES TO P & L & BALANCE SHEETS

7 BREAK EVEN ANALYSIS

8 CMA DATA

9 ANNEXURE

10 DETAILED COST RELATED TO PROJECT

11 MARKETING COSTS

12 CONTINGENCY PLAN

Excel International

Cost of the Project:

(Rs. in Crores)

Proposed

Description

Capital

Expenditure

1 Land & site development 16.96 Total (A) 16.96

2 Buildings & Site Development : 3 School Buildings 44.15 Common Hall 1.29 Canteen 1.30 Parking Lot 0.64 Electrification 1.50 Water System 1.20 Basket ball Court 0.18 Athletics track 3.50 Football Field 1.80 Cricket Ground 2.00 Computer Lab 0.19 Doors Windows and Painting 0.48 Equipments 0.50 Labour 11.24 Total (B) 69.97

3 Furnitures 5.00

4 Working capital 3.07 Total C) 8.07 Total Capital Expenditure (A+B+C) 95.00 Prel. & Pre-op. Exps. 5.00 Grand Total 100.00

Means of Finance: Rs. Equity Share Capital 60.00 Prefrence Share Capital 0.00 Term Loan 40.00 Deposit from Directors / Shareholders 0.00 Total 100.00

Excel International

PROJECTED PROFIT AND LOSS ACCOUNT FOR THE YEARS…

(Rs. in Crores)

Years 2016-17 2017-18 2018-19

A INCOME (Refer Page 14) I School Fees 23.59 29.52 34.13 II Other Income 0.50 0.70 1.00

Total Income 24.09 30.22 35.13 B OPERATIVE EXPENSES I Salaries (Refer Page 14) 0.96 1.05 1.16 II Administrative Expenses (Refer Page 15) 2.31 2.42 2.54 III Depreciation (Refer Page 16) 6.67 5.97 5.32 TOTAL 9.93 9.44 9.02 C Operating Profit Before Int (A-C) 14.15 20.78 26.11 D Interest on Term Loan 0.74 0.44 0.36 E Operating Profit Before Tax 13.41 20.34 25.75 F Provision for Tax 4.14 6.29 7.96 G Profit After Tax 9.27 14.06 17.79 H Retained Profit 9.27 14.06 17.79 I Balance Transferred From P & L A/C 0.00 9.27 23.32 J Profit Carried to Balance-Sheet 9.27 23.32 41.11 K Depreciation added back 6.67 5.97 5.32 L Net Cash Accruals 15.94 20.02 23.11

Excel International

PROJECTED BALANCE SHEET AS ON 31st March....

Years 2014-15 2016-17 2017-18 2018-19

LIABILITIES :

Equity Share Capital 60.00 60.00 60.00 60.00

Profit & Loss A/c 0.00 9.27 23.32 41.11

Shareholders' Fund 60.00 69.27 83.32 101.11

Secured Loans

Term Loan 40.00 39.65 39.05 38.45

Unsecured Loans

Deposits from Directors/Shareholders 0.00 0.00 0.00 0.00

Other Non Current Liabilities(Student Deposit) 0.00 8.67 11.11 12.70

Current Liabilities

Deposit from Students Refundable 0.00 0.17 0.17 0.17

Other current Liabilities 0.00 0.00 0.01 0.01

Provision for Taxation 0.00 4.14 6.29 7.96

TOTAL LIABILITIES 100.00 121.90 139.94 160.40

A S S E T S

Gross Fixed Assets 40.15 80.69 80.69 80.69

Less : Depreciation 0.00 6.67 12.64 17.96

Net Fixed Assets 40.15 74.02 68.05 62.73

Capital Work in Progress 40.81 0.00 0.00 0.00

Non Current Investments 0.00 43.00 64.50 88.50

Current Assets

Cash & Bank Balance 18.54 0.24 0.60 0.72

Electricity Deposit 0.50 0.50 0.50 0.50

Advance Tax 0.00 4.14 6.29 7.96

Other Current Assets 0.00 0.00 0.00 0.00

Total Current Assets 19.04 4.89 7.39 9.17

TOTAL ASSETS 100.00 121.90 139.94 160.40

Diff. 0.00 0.00 0.00 0.00

C.R. N.A. N.A. N.A. N.A.

TOL / TNW 0.67 0.76 0.68 0.59

D:E 0.67 0.57 0.47 0.38

Excel International

A. PROJECTED REVENUE :

PARTICULARS

2016-

17

2017-

18 2017-18

No. Of Students per Year

1,638

2,050

2,370

School Fees Per Month per Student

12,000

12,000

12,000

Months

12

12 12

I

Total Receipts from School

Fees

23.59

29.52

34.13

II Interest from Investments 0.50

0.70 1.00

TOTAL ANNUAL RECEIPTS (A)

24.09

30.22

35.13

B. OPERATING EXPENSES

I SALARIES AND PAYMENTS TO STAFF

Designation Nos. Salary p.m

Total / Month

Rs. (In Crores)

Teaching Staff (Annexure 1)

63

0.2844000

Caretaker

15

20,000

0.0300000

Acccountant

3

40,000

0.0120000

Peon

24

7,000

0.0168000

Security Guards

10

6,000

0.0060000

Sweepers

12

3,000

0.0036000

Kitchen Staff

15

7,500

0.0112500

Total Monthly Salary 0.0796500

Total Salary for the 1st year 0.9558000

Rise in Salaries in next years 0.1000000

II ADMINISTRATIVE EXPENSES

Per Annum

Basis (Amount in Rs.)

Annual (In Crores)

Electricity Power Cost for Rooms (Bimonthly)

0.5000

(Total rooms-102)

Other Electricity Power Cost (Lumpsum)

0.0072

(Lift, Tubewell & Common Lights etc.)

Bus Service Outsourced Contract Cost

1.1500

Stationary & Ptg. Expenses

0.0500

Telephone & Postage

Expenses

0.0500

Misc. Office & Administrative Exps.

0.1500

Advertisement Expenses

0.1982

Repairs & Maintanance

0.0500

(Buildings,Garden,Lift Sports complexs)

Muncipality Tax

0.1500

TOTAL ADMINISTRAIVE EXPENSES

2.3054

Rise in Admin. expenses in next years

0.0500

III Particulars Amount

% rise in exps.

Total Salary for the 1st year

0.9558

0.1000

Total Administraive Expenses

2.3054

0.0500

CCoonnttiinnggeennccyy PPllaann Excel International

Cost of the Project:

(Rs. in Crores)

Proposed

Description Capital Expenditure

1 Land & site development 16.96

Total (A) 16.96

2 Buildings & Site Development :

3 School Buildings 30.15

Common Hall 1.29

Canteen 1.30

Parking Lot 0.64

Electrification 1.50

Water System 1.20

Basket ball Court 0.18

Athletics track -

Football Feild 1.00

Cricket Ground 1.00

Computer Lab 0.19

Doors Windows and Painting 0.48

Equipments 0.50

Labour 9.36

Total (B) 48.79

3 Furnitures 3.00

4 Working capital -

Total C) 3.00

Total Capital Expenditure (A+B+C) 68.75

5 Prel. & Pre-op. Exps. 1.25

Grand Total 70.00

Means of Finance: Rs.

Equity Share Capital 60.00

Term Loan 10.00

Deposit from Directors / Shareholders 0.00

Total 70.00

Excel International

PROJECTED PROFIT AND LOSS ACCOUNT FOR THE YEARS…

(Rs. in Crores) Years 2015-16 2016-17 2017-18

A INCOME (Refer Page 14) I School Fees 11.79 14.76 17.06 II Other Income 0.25 0.35 0.50

Total Income 12.04 15.11 17.56 B OPERATIVE EXPENSES I Salaries (Refer Page 14) 0.48 0.53 0.58 II Administrative Expenses (Refer Page 15) 0.58 0.61 0.64 III Depreciation (Refer Page 16) 3.34 2.98 2.66 TOTAL 4.39 4.12 3.88 C Operating Profit Before Int (A-C) 7.65 10.99 13.69 D Interest on Term Loan 0.12 0.11 0.09

E Operating Profit Before Tax 7.53 10.88 13.60 F Provision for Tax 2.33 3.36 4.20 G Profit After Tax 5.21 7.52 9.40 H Retained Profit 5.12 7.45 9.33 I Balance Transferred From P & L A/C 0.00 5.12 12.57 J Profit Carried to Balance-Sheet 5.12 12.57 21.90 K Depreciation added back 3.34 2.98 2.66 L Net Cash Accruals 8.46 10.43 11.99

Excel International

PROJECTED BALANCE SHEET AS ON 31st March....

Years 2013-14 2015-16 2016-17 2017-18

LIABILITIES :

Equity Share Capital 60.00 60.00 60.00 60.00

Profit & Loss A/c 0.00 5.12 12.57 21.90

Shareholders' Fund 60.00 65.12 72.57 81.90

Secured Loans

Term Loan 10.00 9.83 9.65 9.48

Unsecured Loans

Deposits from Directors/Shareholders 0.00 0.00 0.00 0.00

Current Liabilities

Deposit from Students 0.00 4.51 5.64 6.52

Other current Liabilities

Provision for Taxation 0.00 2.33 3.36 4.20

TOTAL LIABILITIES 70.00 81.78 91.22 102.10

A S S E T S

Gross Fixed Assets 38.75 68.75 68.75 68.75

Less : Depreciation 0.00 3.34 2.98 2.66

Net Fixed Assets 38.75 65.41 65.77 66.09

Capital Work in Progress 30.00 0.00 0.00 0.00

Non Current Investments 0.00 10.37 19.59 29.28

Current Assets

Cash & Bank Balance 0.75 3.17 2.00 2.02

Electricity Deposit 0.50 0.50 0.50 0.50

Advance Tax 0.00 2.33 3.36 4.20

Other Current Assets 0.00 0.00 0.00 0.00

Total Current Assets 1.25 5.99 5.86 6.73

TOTAL ASSETS 70.00 81.78 91.22 102.09

Diff. 0.00 0.00 0.00 0.00

C.R. N.A. N.A. N.A. N.A.

TOL / TNW 0.17 0.26 0.26 0.25

D:E 0.17 0.15 0.13 0.12