Table of Contents
1 EXECUTIVE SUMMARY 3
2 BUSINESS IDEA 4
3 GOALS AND OBJECTIVES 5
4 MARKET POTENTIAL 6
5 COMPETITIVE ANALYSIS 6
6 MARKETING PLAN 7
7 OPERATIONS 9
8 MANAGEMENT AND OWNERSHIP 10
9 RESOURCE REQUIRMENTS 10
10 IMPLEMENTATION 11
11 RISK ASSESSMENT 12
12 CONTINGENCY PLAN 12
13 FINANCIAL PLAN 12

EXECUTIVE SUMMARY

The world's most dangerous animal weighs about two milligrams and pursues its human prey at speeds of barely a mile per hour. It is likely that this crown prince of terror is currently buzzing around you. The dubious honor belongs to none other than the lowly mosMos--a fragile creature, whose bite infects millions with lethal diseases, such as malaria, dengue fever, filariasis, encephalitis etc. Bangladesh, a land of 113 types of mosMoses1, has long been a major victim of the mosMos vectored diseases mentioned above. A wide variety of mosMos deterring devices are in practice, ranging from the most popular d-allethrin based coils, DEET (N, N'-diethyl- n-toluamide) based sprays to electric mats and vaporizers. However, the fact that these devices are far from optimal triggers the need for an efficacious and potent solution to this ever-persisting torment. ActiGreen Bangladesh (AGB), a private limited company, enters the scene by introducing a pioneering spray – Mos-Quit, prepared from NEEM, a divine tree. Traditionally found chemical based killers and repellents are poisons that only kill, or ward off mosMoses for a meager period. In addition, they have been evidenced to have adverse effects on human health. Mos-Quit contains natural compounds that block the internal functioning of hormones in the body of mosMoses. MosMoses, by inhaling Mos-Quit forget to bite, to eat, to mate, or they stop laying eggs. Even if eggs are produced, they do not hatch, or the larvae do not molt. This in turn breaks their life cycle. The population eventually plummets, and mosMoses gradually disappear by having fewer and fewer descendants. The current market for repellents and killers (includes products like coil, spray, mat, vaporizer etc.) is around BDT 3580 million, which is growing at an estimated rate of 4-6% per year. In this very market context, AGB targets to capture 2% of the market initially. Why will the consumers be convinced to buy Mos-Quit? The answer lies in the overall consumer experience cycle associated with the product. In addition to the unique feature of ceasing the breeding of mosMoses, Mos-Quit has several other consumer friendly attributes. Mos-Quit is free from any toxic chemicals, provides superior safety up to 12 hours, and most importantly, it is priced in such a way that even the existing coil consumers can afford one of its three available cans. ActiGreen Bangladesh operates in a highly competitive industry. While other risk factors are low for the company, intra-industry rivalry poses a major threat. AGB therefore has planned to undertake certain special types of marketing strategies such as MAM (Moms against MosMoses) Campaign, obtaining certification by Public Health Organizations, forming strategic alliance with environmentalist organizations since for its supply of raw materials, AGB will plant 25,000 NEEM trees. This will certainly benefit the environment to a great extent. With a view to providing a feasible and effective solution to the problem of this buzzing menace, AGB starts its operations with an initial investment of BDT 38.355 million. Four directors of the company will provide 82% of this required amount while the rest 18% will be financed through bank loan and lease option. The proposed business is associated with various types of risks, which have been incorporated in its discounting rate of 25.07%. With a positive NPV of BDT 50,288,697, the firm’s cash outflows equate the present value of its cash inflows if discounted at a rate of 58.9%. This IRR of 58.9% seems to be a realistic outcome when the industry, competition, and risk factors are considered. The initial investment is paid back within 2.9 years of operation while the discounted payback period stands at 3.12 years. The profitability indicators are as follows:
RATIO 2011-12
|Ratio |2011-12 |2012-13 |2013-14 |2014-15 |2015-16 |
|Return On Equity (ROE) |(0.06) |0.19 |0.69 |1.61 |3.40 |

The stress testing shows positive NPV in all the three cases- Likely (BDT 50.28 million), Best (BDT 78.26 million), and Worst (BDT 26.44 million). The project is expected to positively affect the lives of 287,020 people, which maximizes our Social Return on Investment (SROI).

BUSINESS IDEA

BUSINESS SYNOPSIS

# The Buzzing Nuisance: For centuries, humans have slathered on insect repellents to deter mosMoses - the buzzing menace. But these products have always been far from optimal. Even DEET (N, N'-diethyl- n-toluamide) based popular killers and repellents have numerous shortcomings like inability to provide protection for more than 4 hours, hazardous effects on health, ineffectiveness against specific species of mosMoses etc.2 Certain ingredients used in coils such as wood are directly detrimental to the environment since burning of them emits CO2 and severely pollutes the air.

# The Need for an Effective Solution: In this very context, the need for more effective repellents is increasingly urgent, experts say. According to the World Health Organization, global climate change is expanding mosMoses' range, heightening the risk of disease for millions of additional people.3

# Mos-Quit-The Divine Solution: To solve this momentous problem, ActiGreen Bangladesh (AGB) launches a pioneering spray named Mos-Quit, prepared from NEEM (Azadirachta indica), a celestial tree. Mos-Quit is prepared using 1.52% azadirachtin and 0.04% nimbin, which are two main compounds, isolated from NEEM. They have similar biological properties like that of the mosMos hormones. When mosMoses breathe in these compounds, the real hormones get blocked from working properly. MosMoses "forget" to bite, to eat, to mate, or they stop laying eggs. If eggs are produced they do not hatch, or the larvae do not molt. This in turn breaks their life cycle. The population eventually plummets, and MOSMOSES gradually DISAPPEAR4. [Detailed Effectiveness Test available at Appendix2]

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Figure 1: Process of Ceasing the Reproduction System of MosMoses

CORE BENEFITS OF THE BUSINESS

Benefits to Stakeholders
# Termination of the reproduction process of mosMoses ensures substantial reduction in the mosMos-vectored diseases like malaria, dengue fever, filariasis, encephalitis etc.
# Provision of better personal health safety by using natural, non-poisonous solution from NEEM
# Commencing a profitable business for the investors
# Lucrative financial benefit will be available for our farmers
# Free of cost NEEM Cake for the farmers which is a high-grade organic-fertilizer cum bio-pesticide

Benefits to Environment
# Plantation of 25,000 NEEM trees for raw-materials supply will ensure healthier environment by absorbing substantial amount of CO2 from air. Moreover, unlike coils, Mos-Quit emits zero CO2
# Increased use of organic fertilizer and bio-pesticide will safeguard ecological stability

PRODUCT ATTRIBUTES

# Compelling utility of “ceasing the breeding of mosMoses” while killing them as well
# 12 hours of protection from mosMoses5 (4 hours by conventional killers and repellents)
# 37.36% less cost in terms of sprays, same cost but prolonged safety in terms of coils, 4.37% less cost in terms of mats and vaporizers
# Non-toxic, therefore no health hazard for people. Children remain safe and secured from chemicals

BUSINESS MODEL [Details available at Appendix 1]

# Plantation of NEEM Trees: Plant 25,000 NEEM trees for the raw materials through contract farming with experience-sharing support from Social Forestry Program (the plantation model will be strip plantation along field-aisles; along the Dhaka-Comilla Highway). Usually NEEM trees become eligible for trimming within 10 months from plantation.
# Collection of Raw materials: Collect NEEM leaves, bark, and branches by trimming in every two-day, employing around 160 farmers from the plantation area.
# Processing: Process the collected raw materials in the ActiGreen Production Plant to obtain the liquid Mos-Quit solution using Solvent Extraction Method.
# Canning: Undertake the packaging of the liquid solution in standard pressurized cans supplied by local dealers.
# By-product: NEEM-cake is the main by-product of this process that has vast utility as both organic fertilizer and natural pesticide. This high-grade organic fertilizer from NEEM cake will be given to our farmers free of cost to save their huge burden of purchasing fertilizers. In the subsequent years, with increased production, we will sell the excess amount to local organic fertilizer manufacturers.

GOALS AND OBJECTIVES

STRATEGIC OBJECTIVES:
(1) Secure 21% of the total mosMos-repellent market within 8 years of operation
(2) Supply Mos-Quit to six metropolitan cities by 2015 and hit 12 districts by 2019
(3) Substitute imports for larvicide and adulticide for City Corporations with 56.7% lower cost solution

FINANCIAL OBJECTIVES:
(1) Attain 42% sales growth within 2014
(2) Attain net profit margin of 15.76% in 2013-14, 24.37% in 2014-15, and 30.54% in 2015-16

MARKET POTENTIAL

PROBLEMS THAT TRIGGER OUR BUSINESS
# Futility of Conventional Killers: Conventional chemical-based options are mainly poisons which only kill or deter mosMoses. This feature has proved to be ineffective in battling mosMoses since newer species of mosMoses and therefore endemic mosMos-vectored diseases are evolving (e.g., Culex Mimaticus, recently found in Bangladesh that causes madness6) and developing resistance against these chemicals. Therefore, it is high time we started de-breeding mosMoses rather than only killing them. # Poor Safety Attributes of Chemical -based Repellents: The protection timespan against mosMoses by existing ones is 3-4 hours at best. It indicates the ineffectiveness of the chemical-based mosMos repellents available in the market. Their uselessness has been confirmed by several studies.7-11

# Health Hazards from Chemical Ingredients: The existing alternatives produced from chemical ingredients have severe hazardous effects on human health (e.g., Lung cancer, bronchitis, asthma, eye irritation, headache, cough, cold and sneezing, itching, giddiness, vomiting, nausea etc.)12

ESTIMATING THE MARKET POTENTIAL
The current estimated Bangladeshi market for various mosMos killers and repellents (includes coil, spray, mat, and vaporizer) is BDT 3580 million [Nielsen BD Retail Audit Report, August 2009] with a projected annual growth of 4-6%. Initially, we are going to capture 2% market share. Dhaka City Corporation’s this year’s budget for purchasing larvicide and adulticide is BDT 1.6 crore (DCC Budget 2009-10). We will supply them with liquid Mos-Quit solution at around 57.6% lower costs.

COMPETITIVE ANALYSIS

ONGOING COMPETITION
# Market Outlook: AGB’s major competitors are the brands of ACI Limited, Reckitt Benckiser (RB), and Godrej Sara Lee. Marketing prowess of the former two is well known. RB has more than fifty percent (around 56%) share of the overall mosMos repellent and killer market. ACI caters 36% of the said market. There are product-form based segments in this killer and repellent market. Coils constitute
85% of the overall market whereas Sprays serve only 10-11% of the total consumer base. Products such as vaporizer, mosMos mat, mosMos net, mosMos cream, mosMos racket constitute the rest.

# Consumer Buying Behavior: Low price and fragmented purchase are among the key factors behind the highest sales frequency of coils in Bangladesh. Comparatively higher price of the sprays is particularly responsible for the phenomenon that is supported by our Retail Survey.

FUTURE COMPETITION
It is likely that within a few years there will be new companies as well as the established brands to introduce NEEM based mosMos killers since the processing of NEEM requires low technological orientation. The increased competition can dent profits and shrink the supply of raw materials and other necessary resources.

Fighting Strategies: AGB plans to utilize its “first-mover advantage” to fight the increased future competition. Additionally, it will form Strategic Alliance with Public Health Organizations like and Public Health Association of Bangladesh, which would recommend Mos-Quit as the safest and most effective mosMos fighter. Free from health hazards, Mos-Quit will enjoy the privilege of being suggested by doctors for better personal healthy safety. This will help Mos-Quit achieve a strong brand image among the customers. The company will also try to secure “win-win” situation for all of its stakeholders so that it gets benefitted during the rainy days of immense competition.

BARRIERS TO ENTRY
The barriers of entry to this business are projected to be of medium level. They include –
# Patent protection
# Inadequate supply of raw materials (for moderate level of manufacturers)
# Forming a dedicated, skilled and efficient marketing team for consumer markets

SWOT ANALYSIS
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MARKETING PLAN

Being in a highly competitive industry, ActiGreen Bangladesh is going to unveil a marketing plan that focuses on its competitors as well as on its customers. AGB marketing plan has a major focus on the following-

# Market Size Expansion: AGB plans to expand its potential market size by serving both the coil and spray consumers. As mentioned earlier, coils constitute almost 85% of the total repellent and killer market because of its low cost. Keeping this “price factor” in mind, the company aims at grabbing a significant market share of the coil market by substituting the smoke-emitting coils with its low-cost but longer protection period (7 days for only BDT 36.00) Mos-Quit ECONOMY pack.

MARKETING STRATEGIES
ActiGreen Bangladesh will undertake the following types of strategies to capture the target market:
# Innovative Product Strategies: Focusing on the innovative product feature of ceasing the breeding of mosMoses, superior safety (12 hours), lower price but better utility in terms of any product form and absence of ingredients that cause significant amount of health hazards, especially of children.
# Promotion Strategies: Educating the consumers, more specifically, the Moms regarding the potential health hazards from the use of chemical based repellents. [Additional promotional tools for building brand awareness are available at Appendix 4].

MARKET SEGMENTATION
AGB opts for Demographic segmentation based on Family Size. In the initial years, it will serve the capital city Dhaka (including the City Corporation) and industrially enriched Narayanganj since these two are the most easy-to-reach areas being heavily infested with mosMoses. Our consumer market segments are –
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TARGET MARKET, PRODUCTS OFFERED, AND PRICING APPROACH
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PRODUCT POSITIONING
Mos-Quit is going to position itself in the market based on the following factors –
# Unique feature of growth regulation of mosMoses
# Better efficacy against mosMoses
# Affordable even for the coil consumers because of reasonably low price
# Free from health hazards caused by traditional agents

Combining all of these features, AGB plans to position Mos-Quit in the consumer minds using these taglines – “Q is the Ultimate Safety” and “Think Safety, Think Q”
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DISTRIBUTION SETUP: FROM CORE TO DIVERSE
AGB’s Distribution Setup Management aims at obtaining the highest possible visibility. AGB looks forward to a very simple distribution setup to serve that aim –
# The channel is run by dividing the Dhaka Metropolitan City and Narayanganj urban area into 21 blocks (20 blocks in Dhaka and 1 in Narayanganj) (Details on Appendix 10)
# Each block in Dhaka consists of 2 wards and 1 block in Narayanganj covers the Shadar area
# AGB will have 5 distribution warehouses for 40 Wards (1 warehouse per 4 blocks) in Dhaka, and 1 distribution warehouse for 2 blocks in Narayanganj
# This arrangement covers 8800 retail shops (8000 in Dhaka and 800 in Narayanganj)

INTEGRATED MARKETING COMMUNICATION (IMC) TOOLS
# MAM (Moms Against MosMoses) Campaign: During the schooling hours Moms are seen to be waiting in clusters for their children’s classes to be finished. AGB will set a giant replica of Mos-Quit with permission from the school authority and trained personnel will go and exchange words with the Moms regarding the health hazards of poisonous chemical based repellents. Instantly Moms will be informed the attributes and lower price of Mos-Quit.

Included in the tools will be –

SALES STRATEGY
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MARKETING BUDGET AND TIMELINE
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OPERATIONS

# Raw-materials Collection: “Trimming” will be performed to collect the leaves, bark, and branches from the NEEM trees every two days from the plantation area(s) using vans. According to the process requirement, 3.2 kgs of raw materials produce 1 liter of liquid NEEM extract.

# Production Process: Collected materials will be flushed with distilled water. After going through heating and pressurizing process, static extraction will be done and the active substance for Mos-Quit will be obtained. This active is then mixed with other ingredients (e.g., emulsifiers) in the Mixer and in the final stage; the complete liquid solution is poured into the standard pressurized cans. Around 2 kgs of NEEM cake will be produced automatically from the production of each liter of liquid.

# Delivery: Mos-Quit cans will be packed in cartons [12 cans per carton]. 2 covered vans will be in use to carry Mos-Quit from the production plant to the 6 warehouses mentioned earlier. A total of 4 covered vans (leased from IDLC) will be in operation for delivering Mos-Quit cartons to the retailers.
# Billing: Sales Agents will collect payments from retailers directly. In the initial phase, AGB will allow some credit purchase options for selected retail outlets to penetrate the market. They will be required to make payments within 4 days.

# Inventory Management: AGB’s inventory consists of only finished goods. Two storage rooms will be built for this purpose. Standard computerized inventory management procedures will be followed in keeping track of the inventories. # Quality Control: Quality control is the surviving instrument in this quality driven market of mosMos killers. In this perspective, strict measures will be taken in terms of quality of distilled water, non-toxicity test of the collected raw-materials, inside air pressure of the supplied aerosol cans etc. AGB plans to obtain an ISO 9001: 2009 certificate for its products within the shortest possible time.

MANAGEMENT AND OWNERSHIP

ActiGreen Bangladesh will be a private limited company having four directors – S. M. Ali Mowla, Dr. M Khairul Hossain, Dr. Bidyut Mazumder, and Md. Ashraf Hossain. AGB will consist of three functional deparents – Marketing and Sales, Operations, and Finance and Risk Management. Three BBA graduates from the Institute of Business Administration, University of Dhaka will head each of these three segments. Md. Sakib Khaled and S. M. Ishtiaque will act as the Chief Marketing and Brand Communications Officer and the Chief Finance & Risk Management Officer, respectively. Tanvir Ahmed Tanu will be overseeing the Operations department holding the position of the Chief Executive Officer.

With immense weight on every segment, Marketing and Brand Communications will be the leading department for ActiGreen Bangladesh.

RESOURCE REQUIRMENTS

Primarily AGB will need Investment of BDT 38,355,000.00.
Each of the four directors will be holding 786,278 shares with par value of BDT 10.00. The total contribution of equity capital will be BDT 31,451,100.00 (82% of the total requirement).

Rest of the initial Investment, BDT 6,903,900.00 will be financed through bank loan and lease option.
BDT 2,416,365.00 will be borrowed from BRAC Bank Ltd. as a SME loan against the factory land. Vehicles and machinery worth BDT 4,487,535.00 will be obtained from IDLC as leased assets.

IMPLEMENTATION

IMPLEMENTATION SCHEDULE
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PRODUCT ROLLOUT PLAN
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RISK ASSESSMENT

GENERAL RISK FACTORS
# Demand Risk: The alternative chemical-free product unveiled by this business is the first of its kind in the country. Therefore, the consumer’s acceptability is not reasonably obvious. Risk –MODERATE
# Industry Risk: High competition within the industry poses substantial threat. Risk - HIGH
# Market & Technology related Risk: The business idea in itself requires minimum level of high-tech equipments. Risk – LOW
# Interest-rate Risk: The Company’s primarily dependency on equity financing and lease rentals reduces the degree of intensity of this type of risk. Risk – LOW
# Regulatory Risk: Import substitutions for the country and vast amount of tree plantation activities confront this business with low level of regulatory risk. Risk – LOW
# Environmental Risk: The business may get affected during a period of comparatively lower level of mosMos and mosMos vectored diseases. Risk – LOW to MODERATE
# Operat ional Risk: Unavailability or price increase of raw materials, natural calamities may disrupt the production and can adversely affect the profitability of the company. Risk – MODERATE

PORTER’S FIVE FORCES MODEL ANALYSIS
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CONTINGENCY PLAN

Preliminarily it might not be possible to get the stipulated plantation aisles for planting all of the 25,000 NEEM trees because of certain factors (e.g., poor level of perception of the farmers, unavailability of aisles in a suitable manner etc.). To mitigate this risk, AGB maintains a reserve plantation of 5,000 NEEM trees on its own land besides the factory building.

FINANCIAL PLAN

REVENUE PROJECTION [All Figures are in BDT]
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PRO FORMA INCOME STATEMENT
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PRO FORMA BALANCE SHEET
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PRO FORMA CASH FLOW STATEMENT
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RATIO ANALYSIS
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PROJECT ANALYSIS
WACC method has been used to calculate the discounting rate of this project. The cost of debt is 15% for bank loan and 17% for lease. The speculative return on equity is 27%. Therefore, according to AGB capital structure, WACC stands at: [{(0.17*0.65)+(0.15*0.35)} *0.18+(0.27*0.82)]= 25.07%.
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STRESS TESTING
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DUPONT ANALYSIS
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APPENDIX 1: BUSINESS MODEL
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APPENDIX 2: SEVERITY OF EFFECTIVENESS TEST (SET)
Certification of effectiveness of mosMos has been being given on the quantitative measurement named SET (Severity of Effectiveness Test). The test identifies the effectiveness of a repellent cum de-breeder certain period. It is proved that insects have a natural resistance building power against any repellent used against them. If any repellent can work efficiently and consistently against the insects then SET graph shows a negatively sloped curve for that particular repellent.

APPENDIX 4: DISTRIBUTION WAREHOUSE SETUP
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APPENDIX 5: PROMOTIONAL TOOLS DEMONSTRATION
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APPENDIX 6: FINANCIAL PLAN DETAILS
ASSUMPTIONS RELATED TO THE FINANCIAL STATEMENTS
1. The financial plan is intended to serve the potential as well as the existing investors a clear and decent sensitivity about the performance of the business in the coming years.
2. The business will run its operation for infinite time period i.e. “Going concern principle” will be followed by the company. This principle will be the basis of all financial decisions taken by the management body of the company.
3. Financial projections are made under the historical cost convention based on generally accepted accounting principle.
4. For projecting financial transactions, relevant international accounting standards together with the relevant laws and rules of the country are followed.
5. Growth in sales is calculated on the basis of reasonable forecast.
6. Number of days in a year is assumed 360 days while number of days in a month is considered 30 days for better compliance with the banker of the company and concerned parties.
7. Exchange rate: $1= BDT 69.04 has been used for the calculation.
8. Effective rates of interest have been considered in the overall planning.
9. ActiGreen Bangladesh Pvt. Ltd. will maintain as little accounts receivable as possible. According to decision of the management panel of the company, AGB will allow nearly 10% of its transactions on credit. Moreover, account receivables turnover is assumed to be 24 times in a year.
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Mos-Quit

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1. Country’s first NATURAL mosMos NEEM - Mos-Quit
2. Increased use of Organic fertilizer through the employed NEEM leaves, bark, branches

Farmers

Retailers

Sales Agent

By-Product

Mos-Quit