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SMART UMBRELLA BLUEPRINT

Faculty : College of Computing, Communication

and Multimedia

Program : Intelligent System

Program Code : CS259

Course : Technology Entrepreneurship

Course Code : ENT600

Semester : 6

Group Name : Chip Artificial

Group Members : Siti Norfarhana Binti Mohd Puat

Azizah Binti Rosli
Nurul Hasyimah Binti Hasmuni Chew
Nur Lyana Najla Binti Hukmee
Siti Rubaya Binti Norshamsul
Syaza Hazwani Binti Suhaini
Submitted to

DR MOHAMMED HARDY LOH BIN RAHIM

Submission Date

14 JULY 2023

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TABLES OF CONTENT

1. EXECUTIVE SUMMARY................................................................................... 3
2. PRODUCT OR SERVICE DESCRIPTION.........................................................6
3. TECHNOLOGY DESCRIPTION...................................................................... 10
4. MARKET RESEARCH AND ANALYSIS.........................................................12
5. MANAGEMENT TEAM....................................................................................25
6. FINANCIAL PLAN........................................................................................... 36
7. PROJECT MILESTONES................................................................................46
8. CONCLUSIONS.............................................................................................. 48
9. APPENDICES..............................................................................................................49

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BLUEPRINT OUTLINE

Note:
Before you begin writing within this section make sure that you have done some
research. Blueprint research helps you make informed decisions and create a
successful direction for your blueprint.
● Gather information sources
● Record relevant information
● Analyze the information you have gathered and note the associated
opportunities and risks
● If you are going to submit the blueprint to investors, research what types of
investment opportunities are available to you, why you need investment (banks,
government, private equity investors, etc.)

1. EXECUTIVE SUMMARY

The executive summary is usually short and concise. The summary articulates
what the opportunity conditions are and why they exist, who will execute the
opportunity and why they are capable of doing so, how the company will gain entry
and market penetration; it answers the questions: “for what reason does this
venture exist and for whom?”

Essentially, the executive summary needs to reflect the criteria presented in the
Business Opportunity Analysis Exercises. This is your chance to clearly articulate
how your business is durable and timely, and how it will create or add value to the
end user. This summary is usually prepared after the other sections of the blueprint
are completed.

1.1. Brief description of the business and product concepts

Chip Artificial Sdn. Bhd is a small company that just started their own business,
which is a smart umbrella with multiple functions. The motivation of this business is
due to the hope of some people that wish they can buy an umbrella that can be
used to the fullest and not only just as protection from the rain and sunlight. Due to
that, we innovate the umbrellas to give them more functionality such as put a
fan-blade on the umbrellas to cool down people during the sunny day, equip the
umbrellas with LED light as a lamp to lighten the path when going through the dark,
and weather temperature that being displayed on a small LCD as an information to
the people to prepare themselves in case, in specific times, it will be raining, for
example. This feature is like a wireless mouse that connects to smartphones, but
this time it is between umbrellas and smartphones. This helps enhance user
experience while using the smart umbrella. Due to unknown weather in Malaysia,

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an umbrella is necessary as the citizens always equipped themselves with an

umbrella when they are going outside especially for the urban dwellers. With the
use of a smart umbrella, we can assist users in temperature detection, so that they
can assist users in planning and preparing for their journeys in advance.

1.2. The target market and projections

The target market for the smart umbrellas product is urban dwellers, which is
based on statistics, Malaysia urban population for 2021 was 26,085,557 and
probably now, the year of 2023 the population will be increasing from the previous
years. Our company targets this category of people because rainfall is frequent in
many urban places, thus having an umbrella is vital for protection. Urban dwellers
who are negotiating congested streets, walking to public transportation, or going
about their regular routines can stay dry by carrying these smart umbrellas. Apart
from that, the use of smart umbrellas as fashion accessories is also possible.
Umbrellas present a chance for individual expression in urban settings where
people frequently place a high value on appearance and personal flair. Urban
people frequently choose umbrellas with distinctive patterns, colors, or designs that
go well with their attire, making them both practical and stylish. People like them
may be interested in purchasing our product due to the beautiful LED light and the
fan blade, which is a unique feature of smart umbrellas. Many people who live in
urban areas use walking or public transportation as their main ways of
transportation. They are unable to travel fast between locations without being
exposed to the elements, unlike automobile owners. A practical and portable option
for staying dry while traveling is an umbrella. Therefore, urban dwellers are the
suitable category of people to be our target market for these products.

1.3. The competitive advantages

Most umbrella providers continue to use the conventional umbrella. Due to that, the
technological innovation that incorporates the umbrella is our company's
competitive advantage. Through the use of cutting-edge technology like real-time
weather updates and bluetooth connectivity to the smartphones, the company can
offer their customers a unique and better umbrella experience. This technological

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advancement sets the company apart from other umbrella manufacturers and is
one step ahead from other umbrella manufacturers in Malaysia. The additional
capabilities or features of the smart umbrellas were designed to improve the user
experience. Customers' expectations for ease of use and simplicity are met by
features such as automated open or close mechanisms, compact designs, LED
lights, and built-in charging connections. By focusing on making umbrellas that are
more useful and convenient, the company has a significant competitive advantage
in growing its market share. Smart umbrellas with attractive aesthetics and sleek,
modern designs may appeal to people who value fashion, especially those who live
in cities. The business can distinguish itself from rivals and entice
fashion-conscious customers by showcasing eye-catching designs, distinctive
patterns, or customisable possibilities. The various functionalities and appealing
designs provide the company a competitive edge.Moreover, the amenities that
people really like and sometimes need in umbrellas include functions like fan
blades to keep people cool down on hot days and LED lights to illuminate the road
at night. Because of this, the competitive advantages of our product are in terms of
technology and distinctive functionality.

1.4. The profitability

Pricing has the potential to produce a profit. Each umbrella is expected to cost
between RM60 and RM70. The business is able to maintain premium pricing by
providing smart umbrellas with cutting-edge features and cutting-edge
technologies. Customers that value the smart umbrellas' comfort, usefulness, and
durability are often prepared to spend more for a higher-quality product. The
increased profit margin on each unit sold helps profitability as a whole. The brand
then differentiates itself from rivals during the market capture phase by putting an
emphasis on technological innovation, usability, and design. This differentiation
assists with focusing on a certain market niche that is prepared to pay more for
pricey, high-end umbrellas. The company can increase profitability by successfully
chasing and grabbing this market because there won't be as much price
competition. By encouraging brand loyalty, the company can maintain its profit for a
considerable amount of time. Building a powerful brand and providing premium
smart umbrellas can encourage repeat business and client loyalty. Customers who

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are happy with their purchases are more inclined to tell others about the company's
goods.Sales volume and profitability have improved as a result of repeat business
and word-of-mouth advertising. Last but not least, the businesses can profit from
strategic alliances in which they collaborate with other brands, such as Information
Technology, to develop fresh and cutting-edge umbrellas. Strategic partnerships
have the potential to increase market size, brand recognition, and sales, all of
which would increase profitability.

1.5. The management team

The management team consist of CEO, technology officer, marketing officer,
operation officer, financial officer and customer officer. The CEO responsible in set
the company vision and providing overall strategy of the company. the technology
officer incharge on doing research on technological aspect of the products.
Technology officer oversees the technology strategy, ensures product quality, and
keeps up with new technological developments. Marketing officer leads the
marketing and branding of the company. The marketing officer design appealing
campaigns, maintain brand positioning, and plan and implement marketing
strategies. To increase client acquisition and brand exposure, the officer usually
performs market research, defines target categories, and implements successful
marketing efforts. As for operating officer, they are responsible to oversees the
operational aspects of the company where they manage the supply chain,
production, and logistics to ensure smooth operations. Financial officer handle the
company's financial management and planning. They are in charge of budgeting,
accounting, and investment plans. and customer officer while the customer officer
will be handling customer satisfaction and building strong relationships. They lead
the customer support team, develop strategies to enhance the customer
experience, and gather feedback to improve products and services.

2. PRODUCT OR SERVICE DESCRIPTION

2.1. Describe in some detail the product or service to be produced/sold.

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The product released is the Smart Umbrella, which is a portable umbrella that is
designed to be compact and easy to carry, occupying minimal space in a bag.
Smart Umbrella offered the highest quality at an affordable price to every type of
income level group. Equipped with a series of high-quality LED lights strategically
placed along the outer rib of the canopy, this umbrella illuminates your path,
keeping you visible and safe in low-light conditions. This feature not only guides
you safely but also alerts others to your presence, providing an additional layer of
security during night time adventures.To combat the sweltering heat of modern
times, the Smart Umbrella incorporates a fan-like function integrated within the
middle of the canopy. Along the pole, a compact LCD screen displays real-time
weather temperatures, keeping you informed about the current climate. Wirelessly
connected to your smartphone, this feature ensures swift and convenient access to
up-to-date weather information. For added convenience, the Smart Umbrella
features a USB charging port located at the end of the handle. Protected by a
safety cap, this port allows you to charge your devices on the go, ensuring you
never run out of power during your outdoor excursions. This product can be used
by any user, including the seller, a student, and office workers.

2.2. Discuss the application of the product or service and describe the primary end use
as well any significant secondary applications.

The smart umbrellas have LED lights inside that illuminate when the user is in a
dark environment to help them walk in such an environment. Additionally, the
umbrella has built-in fan blades that work as fans to keep the user cool on hot
days. Furthermore,a bluetooth connectivity between umbrellas and smartphone to
display the weather temperature information at the small LCD on the umbrellas. A
button that automatically opens and closes the umbrella has been designed so that
it can be opened or closed by the user with only a single click, as opposed to the
more labor-intensive old-fashioned methods. So that the user can charge the
umbrella, a charging port is offered. Occasionally, carrying an umbrella might be
difficult since it weighs a lot and is too large to fit in a bag. However, a smart
umbrella is simple to fold up when not in use and small enough to carry anywhere.
The umbrella is connected to smartphone apps, which send notifications to users

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when rain is expected in their location, ensuring they are always prepared. The
material of umbrella cloth is made from nylon material that can withstand drenching
rain, dry quickly, and be folded easily.

2.3. Emphasize any unique features of the product or service and how these will create
or add significant value; also, highlight any differences between what is currently
on the market and what you will offer that will account for your market penetration

The smart umbrella stands out from traditional umbrellas on the market through its
array of distinctive features, offering substantial benefits to users. It boasts
portability and space efficiency, enabling effortless transportation and minimal
storage space. Its inverted design prevents water droplets from spilling onto the
floor when closing, reducing the need for cleanup. The inclusion of LED lights
along the canopy's outer rib illuminates the pathway, ensuring user safety and
visibility in the dark while also declaring their presence. The LED lights are durable,
adjustable, and offer superior quality and lifespan. The smart umbrella further
incorporates a weather temperature display, providing real-time updates to assist
users in planning their activities. Its fan functionality offers heat relief during hot
weather, combining rain protection and comfort. The umbrella's high-quality
materials, such as the nylon canopy with heat retention and UV protection
properties, ensure durability and protection from the elements. The presence of a
USB charging port allows for convenient device charging on the go. With its
generous canopy size and foldability, the smart umbrella accommodates multiple
users while remaining compact for easy storage. These unique features
differentiate it from existing umbrellas on the market, making it an appealing choice
for individuals seeking an innovative and versatile solution that prioritizes
convenience, safety, and comfort.

2.4. Define the present state of development of the product or service and how much
time and money will be required to fully develop, test, and introduce the product or
service. Provide a summary of the functional specifications and photographs, if
available, of the product.

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The current stage of development for the smart umbrella is in the conceptual
phase, where the product's functional specifications have been outlined. The
design of the smart umbrella emphasizes portability, lightweight construction, and
compactness, enabling easy carriage within bags without occupying excessive
space. Its inverted canopy design prevents water droplets from falling onto the
ground when closing the umbrella. To enhance visibility and ensure user safety in
dark conditions, LED lights are integrated along the outer rib of the canopy,
providing illumination along the road or path. The selection of LED light strips is
driven by their durability, cost-effectiveness, superior light quality, and longer
energy lifespan. These strips are also flexible and adjustable, allowing them to
conform to the curve of the umbrella canopy. In addition to these features, the
smart umbrella incorporates a fan-like function within the middle of the canopy,
offering relief from heat during hot weather. The canopy material, made of nylon,
possesses desirable attributes such as fair heat retention ability, stretchability,
moisture-wicking capacity, and waterproof properties. It withstands drenching rain,
dries quickly, and provides UV protection. The umbrella pole, constructed from
steel, provides strength and affordability. Furthermore, the smart umbrella includes
a small LCD display integrated along the pole, which wirelessly connects to a
smartphone to showcase real-time weather temperature information. A USB
charging port is conveniently positioned at the end of the handle, facilitating device
charging, and ensuring safety with the inclusion of a protective cap. With a canopy
diameter of 120cm and a pole length of 70cm, the smart umbrella accommodates

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up to 3 people under its canopy, while its foldable design allows for space-saving
and enhanced portability.

2.5. Discuss any opportunities for the expansion of the product line or the development
of related products or services.

The smart umbrella can be enhanced through various customization options to

appeal to customers seeking unique and personalized products. These options can
include the ability to choose preferred colors, patterns, or even add personalized
logos or designs. Additionally, incorporating additional safety features, such as an
emergency alarm or built-in SOS button, would enhance the umbrella's value
proposition as a safety device. To cater to environmentally conscious consumers,
developing an eco-friendly version of the smart umbrella using sustainable
materials like recycled nylon or biodegradable alternatives would be beneficial.
Emphasizing the umbrella's environmental benefits would help target customers
who prioritize sustainability. Collaborations with other brands can be explored to
create co-branded or limited-edition smart umbrellas, leveraging existing customer
bases and reaching new audiences. To maximize market penetration, targeted
marketing strategies should be developed to attract specific customer segments,
such as outdoor enthusiasts, frequent travelers, or urban commuters who regularly
face unpredictable weather conditions. Additionally, licensing the smart umbrella's
technology and design to other manufacturers or companies as a white-labeled
product can expand its reach and generate additional revenue streams.

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3. TECHNOLOGY DESCRIPTION

The smart umbrella is a device designed to be portable and light thus easy to bring
along without taking too much space in a bag. The tool is similar to an inverted
umbrella to prevent the water droplets from falling onto the floor. The umbrella also
illuminates the road or path for people from getting lost and protects them from
harm and danger. the lights attached along the outer rib of the canopy to declare
the user's presence. Flexible LED light strips have been chosen since the quality of
LED is more fitting for outside use due to its high durability, cheaper, great light
quality, and higher energy life span than common types of lighting. Whereas strips
are bendable and adjustable to follow the curve of umbrella canopy. The LED will
automatically light up the path brightly when the user is walking through a dark
path. The canopy is made of nylon considering that this polymer fabric has fair heat
retention ability, stretchable and moisture wicking ability is waterproof, which can
withstand drenching rain, dry quickly, foldable and great for UV protection.
Other than that, the umbrella also has a fan-like function attached in the middle of
the umbrella canopy. Fans can provide relief from heat to the person since
temperature nowadays has been extremely hot. The umbrella pole is made with
stainless steel since it is inexpensive and strong. Along the pole there will be a
small LCD to display real-time weather temperature. The real-time weather
temperature is connected to the smartphone wirelessly for faster information
transfer. The USB charging port of the umbrella will be situated at the end of the
handle and comes with a cap for safety purposes. Lastly, the smart umbrella can fit
up to 3 people under the canopy with 120cm of canopy diameter and 70 cm of pole
and is foldable for space saving and portability.With its current features and
promising future developments, the Smart Umbrella is set to revolutionize the way
we experience portable protection and convenience.

Future advancements and improvements in smart umbrella technology are on the

horizon, promising to revolutionize the market. These developments include
enhanced smart connectivity, allowing seamless integration with smartphones and
other smart devices to enable features such as GPS tracking, personalized
weather alerts, and voice command controls. Furthermore, the integration of
environmental sensors will provide real-time data on air quality, humidity levels,
and UV radiation, empowering users to make informed decisions and safeguard

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their health. Solar charging capabilities, achieved through the integration of solar
panels on the canopy's surface, will harness renewable energy to recharge the
umbrella's internal battery, ensuring sustainable power for its various functions.
Advancements in smart fabrics will introduce self-cleaning properties, improved
heat insulation, and enhanced weather resistance, further elevating the umbrella's
performance and durability. Additionally, the integration of artificial intelligence will
enable personalized assistance based on user preferences, weather conditions,
and real-time data, offering tailored recommendations for routes, activities, and
nearby points of interest. These future developments in smart umbrella technology
hold immense potential to redefine portable protection and convenience,
enhancing user comfort, safety, and connectivity in various weather conditions and
environments.

4. MARKET RESEARCH AND ANALYSIS

Information in this section needs to support the assertion that the venture can
capture a substantial market in growing industry and stand up to competition.
Because of the importance of market analysis and the critical dependence of other
parts of the blueprint on this information, you are advised to prepare this section
first.

4.1. Customers

a. Discuss who the customers for the product or service are or will be. Potential
customers need to be classified by relatively homogeneous groups having
common, identifiable characteristics (e.g., by major market segment).

Target market: Urban Dwellers

Demographic: Our target customer base consists of individuals between the ages of 18
and 50 years who possess stable employment and income. Our product is not limited to
a specific gender, as both men and women can benefit from using it. Furthermore, our
offerings are particularly well-suited for individuals with a middle income level. This
segmentation allows organizations to gain a precise understanding of consumer
behavior, enabling them to improve their performance by catering to the specific needs
and preferences of this target demographic. By focusing on these characteristics, we aim
to align our product with the requirements and desires of our target customers, ensuring
a more effective marketing strategy and customer satisfaction.

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Psychographic: People who need to go out a lot or live in secluded and dark areas will
need a safety measure and tools to facilitate them with their journey, since smart
umbrellas provide light and give out cooling air under the scorching sun, it provides more
safety measures and increases comfortability for the pedestrian.

Geographic: Malaysia

b. Show who and where the major purchasers for the product or service are in the
market segment. Include national regions and foreign countries, as appropriate.

The country we have chosen for our product is Malaysia where the population has
amounted to 33,619,805 of people stated by Worldmeters and our ultimate target market
is urban dwellers that use umbrellas for their everyday commute or outdoor activities
which accounted to about 26,085,557 of people. They place a great priority on comfort,
communication, and protection against erratic weather. Emphasizing features like
anti-loss monitoring, weather notifications, connection choices to get transportation
information, or engagement with their smart home gadgets is one way to draw in city
people.

c. Indicate whether customers are easily reached and receptive, how customers buy
(wholesale, through manufacturers’ representative, etc.).

Our store is a digital store, a web store that operates primarily on the internet, allowing
customers to browse and purchase products online. It will be easier for us to display the
product to our customers since having a physical store would be pricey for a start-up
company like us. The website will be packed with information about umbrellas and
demos of how it works. The website will be handled from the company office which is
located in Shah Alam, Selangor, following that manufacturing factory is in Shah Alam
area for easier packing and posting. To widen our business, we also decided to promote
our product on online shopping platforms such as Shopee, Goshop, and Lazada to our
customers 24- hours. Customers can simply purchase our product anytime anywhere
sans visiting a physical store to view the product.Our customers' satisfaction with our
services is assured, thanks to the wide range of choices and purchasing methods
available for our smart umbrella.

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4.2. Market Size and Trends

a. Show for three years the size of the current total market and the share you will
have, by market segment, and/or region, and/or country for the product or service
you will offer, in units, ringgit, and potential profitability.

Country Population Target Market Target Market

population

Malaysia 33,641,920 Urban dwellers 26,085,557

Market segment Target market Potential Potential

purchases (RM) purchases (RM)
yearly

Urban dwellers 26,085,557 70.00 1,825,988,990

Market Segment 1st year 2nd year 3rd year

Urban dwellers 1,825,988,990 2,008,587,889 2,209,446,678

b. Describe also the potential annual growth for at least three years of total market for
your product or service for each major customer group, region or country, as
appropriate.

The potential annual growth of the first year, 2023, is RM 1,825,988,990 and is expected
to increase across three years. We estimated in the second year our annual growth is
RM 2,008,587,889 about 10% increase in market sales in 2024. For our third year
approximately RM 2,209,446,678 which is 10%.

c. Discuss the major factors affecting the market growth (e.g. industry trends,
socio-economic trends, government policy, and population shifts).

The market might be affected by the socio-economic and industry trends. umbrella
demand in Malaysia is increasing as the climate crisis continues. The umbrella kept
revolving throughout the years with new features being added to fulfill peoples’ demands
and needs. Now the world is experiencing climate changes, unpredictable and irregular
weather of rain, heat and wind. Usually people exclusively use umbrellas mainly to

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protect themselves from rain and for no other reason. but now with unforeseeable
weather, the market for umbrellas has increased across the country.

Industry trend: the demand for products related to IT is increasing as emerging markets
grow. The umbrella industry in Malaysia has always risen as it deem essential when
living in Malaysia’s weather. As the year increases, more umbrella has revolved along
with IT development to adapt with rising production. The greatest action to begin with a
business in the umbrella industry is with a smart umbrella.

4.3. Competition and Competitive Edges

a. Make a realistic assessment of the strengths and weaknesses of competitors.

b. Compare competing and substitute products or services on the basis of market

share, quality, price, performance, delivery, timing, service warranties, and other
pertinent features.

c. Compare the fundamental value that is added or created by your product or

service, in terms of economic benefits to the customer and to your competitors.

For economic benefits to the customer are higher quality products and services. When
businesses are competing with each other, they are more likely to invest in research and
development in order to improve their products and services. This can lead to higher
quality products and services for customers. Next is more choice, when there is more
competition in a market, customers have more choice of products and services. This can
give customers the opportunity to find the best product for their needs.

In addition to these benefits, competition can also lead to increased innovation and
efficiency. Businesses that are competing with each other are more likely to innovate in
order to stay ahead of the competition. This can lead to new products and services that
benefit customers. Competition can also lead to increased efficiency as businesses look
for ways to reduce costs and improve their operations. This can also benefit customers
in the form of lower prices.

d. Discuss the current advantages and disadvantages of these products or services

and say why they are not meeting customers’ needs.

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Competitors Strength Weakness

UNIQLO ● One of the best ● Less color option

clothing retailer in ● Heavy
Japan ● Long in length
● Provide a great ● Need of fastener
brand material clip
● Excellent water
repellency
● Larger canopy
● Compact
● Tough structure to
withstand wind
● Spinning canopy to
avoid caught
against other
umbrella and resist
strong wind

Decathlon ● A largest French ● Less design and

sporting goods colors
retailer in the world ● Expensive
● Provide good ● Golf umbrella is
umbrella with fair quite bulky
amount of price ● Loop on the handle
● Wide canopy length is too small
● Has upf50-ultralight ● Button is too
● Strong to withstand sensitive
wet and windy
weather
● Easy return policies

Muji ● One of the best ● Expensive

brands from Japan. ● Small canopy size
● Provide all house ● Fabric may leak in
and self necessities heavy rain
● Wide variety of ● Frail against heavy
design and colors rain and strong
● Foldable wind
● Lightweight ● Made of a glass
● Sleek design fiber, may cause
injury if broken

Chip Artificial Sdn. Bhd. ● A local Malaysia ● A new and

company that unknown company
produce a smart as it is run by a
umbrella small trader

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● A brand-new ● Quite expensive

high-tech invention ● Once broke the
that is user-friendly battery charging
and simple to use port, other become
● Wide large canopy useless
● Sturdy and strong
● Foldable
● Has upf50
● Provide Flexible
LED lights
● Provide fan blade
for heat
● Display real-time
weather and
temperature

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4.4. Estimated Market Share and Sales

a. Based on your assessment of the advantages of your product or service, the

market size and trends, customers, competitors, and their products, estimate the
share of the market and the sales in units and ringgit that you will acquire in each
of the next three years. Remember to show assumptions used.

Product/service Market Share and Sales

Year
2023 2024 2025

Market share (%) 0.001% 0.001% 0.001%

Total sales in units 35,714 42,857 46,428

Total sales in RM 2,499,980 2,999,990 3,249,960

Market Size:
Year 1 = 1,825,988,990
Year 2 = 2,008,587,889
Year 3 = 2,209,446,678

2,499,980
𝑀𝑎𝑟𝑘𝑒𝑡 𝑆ℎ𝑎𝑟𝑒 2023 = 1,825,988,990
= 0. 001%
2,999,990
𝑀𝑎𝑟𝑘𝑒𝑡 𝑆ℎ𝑎𝑟𝑒 2024 = 2,008,587,889
= 0. 001%
3,249,960
𝑀𝑎𝑟𝑘𝑒𝑡 𝑆ℎ𝑎𝑟𝑒 2025 = 2,209,446,678
= 0. 001%

4.5. Marketing Strategy

a. Overall marketing strategy. Describe the specific marketing philosophy and

strategy of the company, given the value chain and channel of distribution in the
target market. Include, for example, a discussion of the types of customer groups
that you are targeting for initial intensive selling effort and those that you are
targeting for later selling efforts.

Our marketing strategy consists of two selling efforts. Namely, the initial intensive selling
effort and later selling effort. Our target market would be the general public, especially
commuters, outdoor enthusiasts, or in another name is urban dwellers. Target customers
would be the general public, especially those who walk a lot and cannot stand the heat
from the sun. In order to reach its target market, we will use a multi-channel distribution
strategy that combines online and offline channels.

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Initial Intensive Selling Effort

In this stage, we will focus our efforts on the commuters. This is because they travel
some distance to arrive at their destinations on a regular basis. During their commute,
the path they walk on may not be accommodated with covered walkways or thick trees
to give shade to the commuters. The next target would be outdoor enthusiasts. This
target group enjoys outdoor activities such as picnics, strolling, camping, and so on. It
just means anyone who enjoys being outside their home.

Later Selling Effort

In this stage, we will still focus on the urban dwellers just like during the initial intensive
selling effort. To boost the existence of Smart Umbrella.

b. Pricing. Discuss the pricing strategy, including the prices to be charged for your
product and service, and compare your pricing policy with those of your major
competitors.

RM70.00 per unit

Price = RM35.82 (Cost) + RM 34.18 ( Desired Margin) = RM70.00

Company Product’s Name Price (RM) Policy

- Return and acceptance period

is within 30 days of purchase.
- Product cannot be returned if
the product is:
- used
- washed
- altered
- exceed 30 days from
purchase date
UV Protection Compact - no invoice or purchase
UNIQLO 79.90
Umbrella receipt
- no price tag or label
- damaged
- Products can be returned for
exchange or refund but must
return in original packaging
with price tags and labels.
- UNIQLO (Malaysia) reserves
the right to reject requests for
returns and/or refunds.

Profilter Micro - black 45.00

Decathlon - 2 years warranty

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Golf Profilter Large Umbrella - Customers are allowed to

79.00
Black Eco Designed exchange the product within 1
year of buying.
Golf Profilter Medium - Free delivery nationwide
Umbrella Black Eco 59.00
Designed

Golf Umbrella Profilter Small

49.00
Dark Blue Eco Designed

Light-Weight Foldable
59.90 - Customers are allowed to
Umbrella
exchange the product within 1
Polyester Light-Weight week of buying.
69.00
Foldable Umbrella - Currently do not offer delivery
Muji services to areas outside of
Markable Umbrella With Malaysia.
79.00
Double Dot Button - Purchases RM 7000 and
above there will be a standard
2 Ways Foldable Umbrella corporate discount of 10%.
119.00
With Double Dot Button

- Warranty duration is 1 year.

During the duration, customers
are allowed to request for
refund or exchange if the
product was damaged.
- Warranty will not be applied to
products being defected due to
customers’ own misconduct
- Type of purchase depends on
the platform the customers buy
Chip Artificial Sdn. Bhd. Smart Umbrella 70.00
through.
- Original webstore:
Customers must have
bank account to do
Internet transfer FPX or
online banking
- Other online retailer:
Customers must refer
to the platform’s
policies

Our pricing strategies will consist of market based pricing, and value based pricing.

Market-based pricing

Market-based pricing is a technique of setting prices in line with the competitors’

products. Based on the table above, it can be seen that Smart Umbrella can be such a
good deal and it is being sold for RM 70 compared to other competitors’ umbrellas.

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Theoretically, Smart Umbrella is worth to be purchased as it offers more than just the
ordinary umbrella out there and complete with other features such as mini fan to cool the
user, LED lights to illuminate in dark, and has display of weather and temperature in
realtime. Unlike the competitors’ umbrellas, it is just like any other ordinary umbrella.

Value-based pricing

Value-based pricing is a pricing method that bases pricing decisions mostly on how
much a consumer thinks a something or service is worth. Customers are the emphasis
of value-based pricing, which bases prices on what consumers think a product is worth.
In order to do this we have to do a market survey and research on the general public
about our Smart Umbrella whether the product will be accepted or not by them. We
found that the price of Smart Umbrella being sold for RM 70 is reasonable.

Below is the breakdown of materials used in Smart Umbrella.

Material Price in bulks (RM)

Umbrella 9.32

Fan 3.00

Flexible LED strip 3.00

Weather and temperature display 3.00

Type-C Fast Charging Jack Port 1.50

Power Supply 6.00

Total 25.82

Below is the total cost of Smart Umbrella for the year 2023. We set our desired margin to
RM34.18. We choose to make 35,714 units per year.

Cost Price (RM)

Material 25.82* 35,714 = 922,135.48

Operation 6 * 35,714 = 214,284

Overhead 4 * 35,714 = 142,856

Total Cost 1,279,275.48

𝐶𝑜𝑠𝑡 𝑝𝑒𝑟 𝑢𝑛𝑖𝑡 = 1, 279, 275. 48/35, 714 𝑢𝑛𝑖𝑡 = 𝑅𝑀 35. 82

𝑆𝑒𝑙𝑙𝑖𝑛𝑔 𝑝𝑟𝑖𝑐𝑒 = 𝑅𝑀35. 82 + 𝑅𝑀34. 18 = 𝑅𝑀 70

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Below is the total cost of Smart Umbrella for the year 2024. We set our desired margin to
RM34.18. We choose to make 42,857 units per year.

Cost Price (RM)

Material 25.82 * 42,857 =1106567.74

Operation 6 * 42,857 =257,142

Overhead 4* 42,857 =171,428

Total Cost 1,535,137.74

𝐶𝑜𝑠𝑡 𝑝𝑒𝑟 𝑢𝑛𝑖𝑡 = 𝑅𝑀 1535137. 74/42, 857 𝑢𝑛𝑖𝑡 = 𝑅𝑀 35. 82

𝑆𝑒𝑙𝑙𝑖𝑛𝑔 𝑝𝑟𝑖𝑐𝑒 = 𝑅𝑀35. 82 + 𝑅𝑀34. 18 = 𝑅𝑀 70

Below is the total cost of Smart Umbrella for the year 2025. We set our desired margin to
RM34.18. We choose to make 46,428 units per year.

Cost Price (RM)

Material 25.82* 46,428 =1,198,770.96

Operation 6 * 46,428 =278,568

Overhead 4 *46,428 =185,712

Total Cost 1,663,050.96

𝐶𝑜𝑠𝑡 𝑝𝑒𝑟 𝑢𝑛𝑖𝑡 = 𝑅𝑀 1663050. 96/46, 428 𝑢𝑛𝑖𝑡 = 𝑅𝑀35. 82

𝑆𝑒𝑙𝑙𝑖𝑛𝑔 𝑝𝑟𝑖𝑐𝑒 = 𝑅𝑀35. 82 + 𝑅𝑀34. 18 = 𝑅𝑀 70

c. Sales tactics. Describe the method (e.g., own sales force, sales representatives,
direct mail, or distributors) that will be used to make sales and distribute the
product or service.

Sales tactics encompass a range of techniques and approaches utilized by sales

practitioners with the aim of influencing and persuading prospective clients to spend
money on a particular product or service. The aforementioned strategies are specifically
crafted to exert an impact on the thought processes involved in a customer's
decision-making, effectively addressing their concerns and ultimately guiding them
towards the act of purchasing. Below are the possible sales tactics that we could
implement for Smart Umbrella.

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Develop a strong social media presence

The first sales tactic that we can use is to develop a strong social media presence. This
is because maintaining a consistent social media presence holds significant importance
for businesses. It helps the business boost their SEO score, increase brand
engagement, and offer avenues for marketing and brand discovery. We can use social
media such as Facebook, YouTube, Twitter, etc. to build awareness about Smart
Umbrella.

Create sense of urgency

This tactic is one of the common strategies implemented by other businesses. The
business will create a sense of urgency in customers by making limited-time offers,
exclusive deals, or any promotions that have deadlines. This tactic takes advantage of
people's innate desire to avoid missing out (FOMO). Consumers who fear missing out on
something are more likely to take action.

Proofs, reviews, and testimonies

Another tactic that we can use is through proofs, reviews, or testimonies from customers
who bought the Smart Umbrella. This can be done by collecting all the responses of the
customers who bought the Smart Umbrella then utilizing them as marketing or
promotional materials. Proofs, reviews, and testimonies from previous customers can
help the business build credibility and confidence for the future customers.

d. Service and warranty policy. If your company will offer product that will require
service, warranties, or training, indicate the importance of these to customers’
purchasing decisions and discuss your method of handling service problems; also,
highlight the kind and term of any warranties to be offered, whether service will be
handled by company service people, agencies, dealers and distributors, or return
to the factory.

We are aware of the importance of service, warranties, and training in customers’

purchasing decisions. This is because it will influence the customers’ confidence and
satisfaction in buying the Smart Umbrella.

Warranty coverage Aspects of warranty that will be covered are manufacturing defects, and faulty

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components.
- Defected umbrella (umbrella cloth, crooked pole)
- Faulty fan (not able to switch on, crooked fan)
- Faulty LED lights (not able to switch on)
- Faulty weather and temperature display
- Faulty charging port (not able to charge)

Warranty duration Warranty duration of Smart Umbrella is 1 year.

Warranty will not be covered for damaged Smart Umbrella if:

- Damaged due to misuse
Conditions and limitations
- Damaged due to natural disasters
- Damaged due to unauthorized customization

To ensure that our customers can submit their reports easily, we will provide
platforms for their report submission and our customer service will take care of it.
Warranty claims - Chip Artificial Sdn. Bhd.’s social media (Twitter, Facebook, Instagram)
- Smart Umbrella Online Store
- Official email specialized for report complains

There are two ways on how we handle returned products based on what channel
the customers use Smart Umbrella. Customers can choose whether they want to
be issued with a refund or replacement.
1. Through official online store of Smart Umbrella: the customers have to
Handling service problem
send back the product to our company and then we will send it to the
factory for new products
2. Through online retailers: the customers have to send back the product to
our company and then we will send it to the factory for new products

e. Advertising and promotion. Describe the approaches the company will use to bring
its product or service to the attention of prospective buyers.

Since Chip Artificial Sdn. Bhd. is still a newbie in the business industry, our marketing
team has decided to use the strategies below as our approach to advertising and
promoting Smart Umbrella.

Create catchy and memorable tagline

In order to attract attention to our Smart Umbrella, we need to create a catchy and
memorable brand name, logo, and tagline that can impact customers or potential
customers.

Create a skit

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We would create and act in a skit about the product while simultaneously emphasizing
the product’s quality, features, and innovation. The skit will then be shared online and
offline as an advertisement.

Online and offline advertising

We can advertise our Smart Umbrella on social media sites such as YouTube, TikTok,
Facebook, or Instagram to garner more potential customers and make our products
known. We will promote Smart Umbrella by sharing the time it goes on sale, sharing the
skit that we have created, and interacting with other users on the platform so our
presence will be known. Another way of advertising our product is through TV ads, which
are the commercial breaks. A few channels on Astro have shopping shows where they
will advertise products on TV and then encourage the viewers to buy them. Lastly,
renting a billboard could be utilized as our approach to promotion.

Pay influencer

We should pick a suitable influencer to review our Smart Umbrella while simultaneously
promoting the product to a wide range of viewers who could be our potential customers.

f. Distribution. Describe the methods and channels of distribution you will employ.

Our method of distribution would be through the retailer channel. The retailer that will sell
our Smart Umbrella will be our own online store and online shopping platform, such as
Shopee, GoShop, and Lazada.

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5. MANAGEMENT TEAM

This section includes a description of the function that will need to be filled, a
description of the key management personnel and their primary duties, an outline
of the organizational structure for the venture, a description of the board of
directors, a description of the ownership position of any other investors, and so
forth. You need to present indications of commitment, such as the willingness of
team members to initially accept modest salaries, and of the existence of the
proper balance of technical, managerial, and business skills and experience in
doing what is proposed.

5.1. Organization

a. Present the key management roles in the company and the individuals who will fill
each position.

Key Management Roles Name

Founder Siti Rubaya Binti Norshamsul

Technology Officer Azizah Binti Rosli

Marketing Officer Syaza Hazwani Binti Suhaini

Operation Officer Nurul Hasyimah Binti Hasmuni Chew

Financial Officer Siti Norfarhana Binti Mohd Puat

Customer Officer Nur Lyana Najla Binti Hukmee

b. If it is not possible to fill each executive role with a full-time person without adding
excessive overhead, indicate how these functions will be performed (e.g., using
part-time specialists or consultants to perform some functions), who will perform
them, and when they will be replaced by full-time staff members.

Because it is not feasible to fill every executive position with a full-time employee
without incurring excessive overhead, one alternative that can be done is to pursue
cross-functional collaboration and task sharing as an alternative. Cross-functional
collaboration refers to activities when employees have several tasks in many areas
of work rather than a single, specialized task. This increases staff productivity and
aids in diversifying their project management skills. To help the company achieve
its vision, for instance, the CEO can be directly involved in the marketing and
technological processes. As a startup company, it may be difficult for a beginning
firm to hire a large number of employees. To lessen the financial burden, the
company might engage in cross-functional collaboration among its

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employees.Because it is not possible to fill each executive role with a full-time

person without adding excessive overhead, the company takes an alternative by
doing cross-functional collaboration and sharing of duties among employees.
Cross-functional collaboration is activities where an employee is not specific to a
specialized task, they have multiple tasks in different area works. This helps to
enhance employee productivity and help in devising their skills in project
management. For example, they are involved directly in technology and marketing
processes to help in achieving the company's vision. For a startup company, hiring
a lot of workers might be hard as we are under budget to pay huge sums of wages
to the workers, so to ease the burden economically, the company can do
cross-functional collaboration among its employees.

Other than that, it is important to hire administrative workers to support the overall
company management. These experts carry out significant duties that support the
smooth operation of day-to-day business operations. Receptionists, administrative
assistants, and office managers are examples of administrative professionals who
handle a variety of duties, such as managing letters, arranging appointments,
keeping track of office supplies, organizing meetings, and generally supporting
other departments. They act as the center of the business, ensuring efficient
communication, streamlining processes, and upholding an orderly workplace. Their
focus on detail, excellent organizational abilities, and capacity for multitasking lead
to higher production and contribute to the overall success of the business. A
company's ability to operate efficiently and achieve overall success is greatly
influenced by the hiring of administrative staff. These experts carry out significant
duties that support the smooth operation of day-to-day business operations.
Receptionists, administrative assistants, and office managers are examples of
administrative professionals who handle a variety of duties, such as managing
letters, arranging appointments, keeping track of office supplies, organizing
meetings, and generally supporting other departments. They act as the center of
the business, ensuring efficient communication, streamlining processes, and
upholding an orderly workplace. Their focus on detail, excellent organizational
abilities, and capacity for multitasking lead to higher production and contribute to
the overall success of the business.

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5.2. Key Management Personnel

a. For each key person, describe in detail career highlights, particularly relevant
know-how, skills, and track record of accomplishments that demonstrate his/her
ability to perform the assigned role.

Names & Positions Career Highlights

Has a solid entrepreneurial history and is able to
Siti Rubaya Binti Norshamsul- identify market opportunities, build a strategic company
CEO vision and successfully carry out business plans.

Relevant know-how and skills:

- CEO must be knowledgeable about consumer

preference, market dynamics, and the market
for smart umbrellas

- Competent in business development, fund

raising, and wise decision-making.

- Has a strong leadership that can inspire the

management team and advance the
organization

Record of accomplishment:
- has more than 5 years of expertise in the
business-to-consumer sector

- Works as project manager for 2 years in a tech

company

- has an experience of 2 years of being the chief

technology officer
Azizah Binti Rosli- Technology Has years of expertise in technology and product
Officer development. The ability to successfully design,
develop, and market cutting-edge products with
cutting-edge features while managing the product life
cycle and guaranteeing product quality.

Relevant know-how and skills:

- Possesses in-depth technical knowledge in a

variety of areas, including networking,
embedded systems, and the Internet of Things.

- skilled in integrating hardware and software,

creating firmware, and testing products.

- Always keep up with market trends and

emerging technology

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- Have excellent analytical and problem-solving

abilities.

Record of accomplishment:

- Experience in leadership skills. Increased

customer satisfaction by 45% and sales by
24% for Software company.

- Initiated and managed the introduction of a

cross-platform mobile version of the desktop
product, which reached 500k+ downloads in
the first quarter.

- Initiated and coordinated the implementation of

new data security measures across the
company’s IT infrastructure.

Capable of implementing successful marketing

strategies and increasing brand awareness thanks to
Syaza Hazwani Binti Suhaini- their solid marketing experience. They successfully
Marketing Officer created and managed marketing teams, ran effective
campaigns, and considerably increased sales.

Relevant know-how and skills:

- strategic planning
- digital marketing
- search engine marketing
- social media marketing
- Brand building
- critical thinking and problem solving

Record of accomplishment:

- Experience in directing creative teams of sales

and marketing experts as well as building and
executing online advertising campaigns.

- Develop comprehensive web marketing plans

for clients' products and services.

- Work together with the web development team

to create specialized and small-scale websites
for the products of clients.

- ensured that the company's brand identity was

consistent throughout all of its intellectual

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properties, including its website, social media

accounts, and specialist websites.

Has extensive knowledge of operations and supply

Nurul Hasyimah Binti Hasmuni chain management, which has allowed them to
Chew- Operation Officer successfully streamline processes, reduce costs, and
boost productivity. They have handled manufacturing,
logistics, and vendor relations to ensure effective
operations and fast delivery.

Relevant know-how and skills:

- Staff management
- Process improvement
- Operations management
- Personnel development
- Contract negotiations

Record of accomplishment:

- Create and implement fresh strategies to win

back former partners and clients.

- Made sure that 30 distinct goods received the

best possible use of corporate resources to
maximize earnings.

Possesses vast experience in both strategic planning

and financial management, allowing them to address
Siti Norfarhana Binti Mohd Puat- the needs of growing firms in terms of forecasting,
Financial Officer budgeting, and financial analysis. They have prior
experience in ensuring legal compliance, raising funds,
and financial reporting.

Relevant know-how and skills:

- Financial planning
- Corporate strategy
- Generating reports
- Investment management
- Accounting
- Business skills
- Taxes
- Cash management
- Management information systems
- Investor relations

Record of accomplishment:

- Worked together with cross-functional teams to

improve automated outreach and turn around a

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decreasing trend in past-due account

collections.

- By reviewing current programmes and

reworking marketing and advertising budget
plans, sales were increased by 160%.

- Profit margin was raised from 10% to 23% in 15

months by focusing on new product
development rather on commodities.

Nur Lyana Najla Binti Hukmee- Has a good background in handling customer
Customer Office experience management where they successfully led
customer service teams, implemented strategies to
increase client retention. They are skilled at gathering
and analyzing customer feedback, implementing
projects for improvement, and cultivating relationships
of trust with customers.

Relevant know-how and skills:

- micro and macroeconomics customer service

- Business operations
- Cloud computing
- Data analysis
- Project management
- Negotiation

Record of accomplishment:

- increase ROI by employing a two-pronged

commercial forecasting strategy to reinforce the
company's competitive advantage.
- start the first company customer satisfaction
survey, which resulted in improved customer
service

b. Describe the exact duties and responsibilities of each of the key members of the
management team.

Names & Positions Duties & Responsibilities

● Establishing the company's strategic
Siti Rubaya Binti Norshamsul- CEO direction and vision.

● Making important company decisions

and seeing that they are carried out.

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● Locating market possibilities and

prospective collaborations.

● Controlling the overall business

operations and financial results.
● assembling and managing the
management group.

● Developing and sustaining connections

with investors, partners in the industry,
and stakeholders.

● Representing the business at meetings,

conferences, and trade shows.

Azizah Binti Rosli- Technology Officer ● Developing and doing research for smart
umbrella goods.

● Locating and incorporating cutting-edge

features and technology.

● Overseeing the design, testing, and

prototype of products.

● Ensuring that smart umbrella items are

trustworthy and high-quality.

● Collaborating with the engineering team

to enhance the functionality of the
product.

● Keeping abreast on market

developments and new technologies.

● Managing vendor and technology

partnership interactions.

● Creating and putting into practise

marketing plans to advertise smart
Syaza Hazwani Binti Suhaini- Marketing umbrella products.
Officer
● Conducting competitive analysis and
market research.

● Increasing brand recognition and

maintaining the company's reputation.

● Preparing and carrying out efficient

marketing strategies across a variety of
platforms.

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● Working together with the design team to

maintain a unified brand message.

● Examining marketing KPIs and modifying

plans in response to results.

● Establishing and maintaining connections

with partners, media, and influencers.

● Managing the business's daily

Nurul Hasyimah Binti Hasmuni Chew- operations.
Operation Officer
● Optimizing production, logistics, and
supply chain procedures.

● Controlling forecasting and inventory

management.

● Ensuring regulation compliance and

product quality management.

● Managing interactions with

manufacturers, distributors, and
suppliers.

● Putting in place effective operating

systems and procedures.

● Locating opportunities for process

optimisation and cost reduction.

● Managing the planning, budgeting, and

forecasting of the company's finances.
Siti Norfarhana Binti Mohd Puat-
Financial Officer ● Analyzing financial data and keeping
track of financial performance.

● Overseeing capital allocation and cash

flow management.

● Assessing financial risk and putting

risk-reduction measures into practice.

● Ensuring compliance with reporting and

financial regulations.

● Managing fundraising and investor

relations initiatives.

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● Supplying financial information to aid in

making strategic decisions.

Nur Lyana Najla Binti Hukmee- Customer ● Creating and putting into action
Officer customer-focused plans and activities.

● Overseeing customer service teams and

guaranteeing superior performance.

● Taking client feedback into account and

using it to enhance products.
● Establishing and sustaining solid ties with
customers.

● Keeping track of measurements for

customer satisfaction and putting them to
use.

● Coordinating with other teams to improve

the overall client experience.

● Identifying possibilities for loyalty and

client retention programmes.

5.3. Management Compensation and Ownership

a. State the salary to be paid, the share ownership planned, and the amount of equity
investment (if any) of each key member of the management team.

Names & Positions Monthly salary Share of Amount of Equity

ownership Invested
RM 11,200.00 40% ownership RM 800,000.00
Siti Rubaya Binti Norshamsul-
CEO

RM 7,250.00 15% ownership RM 300,000.00

Siti Norfarhana Binti Mohd
Puat- Financial Officer

RM 6,750.00 15% ownership RM 300,000.00

Azizah Binti Rosli- Chief
Technology Officer

RM4,850.00 10% ownership RM 200,000

Syaza Hazwani Binti Suhaini-
Chief Marketing Officer

RM7,883.00 10% ownership RM 200,000.00

Nurul Hasyimah Binti Hasmuni

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Chew- Chief Operation Officer

Nur Lyana Najla Binti RM3,500.00 10% ownership RM 200,000.00

Hukmee- Chief Customer
Officer
RM 41,433 100% RM 2, 000, 000
Total

5.4. Supporting professional advisors and services

a. Indicate the supporting services that will be required.

In order for the company to sell their product in the online market, the company
needs to have its own website and work with other online shopping applications to
interact with more target consumers.Therefore, it is crucial for the business to have
specialized web development, hosting, and security services in order to integrate
its operations into online shopping through engaging and safe websites for the
user. Other than that, Additionally, the corporation needs legal services to prevent
any potential legal issues with its operations. Legal services are essential for many
elements of the business, such as company creation, contract formulation and
review, intellectual property protection, regulatory compliance, and resolving any
potential legal concerns. Next, it is good for the company to have IT and
technology services to maintain and optimize digital infrastructure, develop and
maintain websites, provide software solutions, handle data, integrate new
technologies, and deal with smart umbrella goods. As the company is a startup
company, it is important to have professional consulting services especially in the
financial field to help provide specialized guidance and expertise for the employee
so they can plan and generate good budget planning to enhance the company
resources. In addition to budget preparation, it is important to be aware that
accounting, advertising, and marketing strategy are the factors that affect a
project's success. Therefore, it is beneficial for the business to acquire additional
services related to the particular activity to aid in effectively strategizing their
company goal and target.

a. Indicate the names and affiliations of the legal, accounting, advertising, consulting,
and banking advisors selected for your venture and the services each will provide.

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Name of Professional Advisors Services Provided

Smith & Associates Law Firm Legal services for the establishment of
the business, the design and
examination of contracts, the defense of
intellectual property, regulatory
compliance, and any other legal issues
that might develop throughout the
enterprise.

Stellar Strategy Consultants Professional consulting services focused

on market research, strategic planning,
business development, operational
improvement, and giving direction and
experience to assist the venture's
expansion and success.

Elite Bank Financial consulting services, support the

venture's financial requirements, help
establish banking relationships, advice
on financial transactions, cash flow
management, and other banking-related
services are provided.

Greenfield & Co. Accounting Firm Bookkeeping, financial statement

creation, tax compliance, financial
analysis, and aid with managing financial
records and reporting are all professional
accounting services.

Digital Sparks Advertising Agency Strategic marketing and advertising

services, including producing advertising
campaigns, building brand recognition,
managing digital marketing channels,
gathering market data, and refining
market research methods for the
venture's products.

TechPro Web Solutions Website development and maintenance,

e-commerce functionality
implementation, CMS integration, reliable
and scalable web hosting, web
application security

6. FINANCIAL PLAN

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Sound financial management is one of the best ways for the business venture to
remain profitable and solvent. In this section think through some of the general
issues you will have to address in your formal business plan.

To effectively manage your venture finances, plan a sound, realistic budget by

determining the actual amount of money needed to start your venture (start-up
costs) and the amount needed to keep it open (working capital or operating costs).

6.1 Start-up Cost

Estimate the costs incurred in conjunction with one-time activities that the venture
undertakes when it opens a new facility, introduces a new product or service,
conducts business in a new territory or with a new class of customer or beneficiary,
initiates a new process in an existing facility or commences some new operation
after considerable research and discussion.

A. Startup Cost
RM

Capital Expenditure: Administrative

Patent 2,500

Office equipment 55,000

Office renovation 30,000

Vehicles 100,000

Office Building 250,000

Capital Expenditure: Operations

Machinery and Equipment 350,000

One-Time Start-up Expenditure

Advertising for opening:

Instagram Ads Promotion for 3 months 1,350

Grand opening cost 10,000

Tik Tok Advertising (1 campaign) 2,328.75

Other Pre-operations Expenditure

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Deposit (rent, utilities, etc) 5,000

Business Registration and Licenses 1,500

Insurance & Road Tax for Motor Vehicle 10,000

Permit 100

Other Expenditure

Start-Up Costs 817,778.75

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6.2 Working Capital

Working capital represents the amount of initial expenditure required to finance the
daily operation until the business gets its first sale. The amount of working capital
is therefore dependent upon the period until the firm can generate enough sales to
cover its short-term expenditure.

WORKING CAPITAL (MONTHLY) RM FIXED VARIABLE

Marketing
Delivery expenses 10,000 10,000
Advertising 2778.75 2778.75
Business card 180 180

Administrative
Salaries and wages 41,433 41,433
Rent 2,000 2,000
Utilities 750 750
Office supplies 200 200
Insurance 900 900
Office maintenance 500 500

Operations
Salaries & wages 37500 37,500
Operation overhead and utilities 3,666.67 3,666.67
Raw materials 9,467 9,467

Other Expenditure

Total Working Capital 127,375.42 89,020.50 23,133.67

Total Working Capital Required 1 months 127,375.42

Working Capital + Contingencies 5 % 133,744.19

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6.3 Start-up Capital and Financing

Total start-up capital incorporates both start-up cost and working capital needed to
start a project. The most common source of finance for new ventures is the
entrepreneur’s own equity contribution. The equity contribution can be in the form
of cash or assets. The next most common source of finance is term loan. This is a
form of long term financing offered by most commercial banks. The term loan can
be used to finance fixed assets as well as working capital requirements. The
interest rate and the loan period depend on the current interest rate and the
amount of loan required respectively.

ESTIMATED START-UP CAPITAL 2,000,000

FINANCING

Equity: Share & Venture Capital 2,000,000

Loan

Annual Interest Rate

Loan Duration (Years)

6.4 Cash Flow Statement

A cash flow pro-forma statement refers to the projected statement of cash inflow
and outflow throughout the planned period. Under normal circumstances, the pro
forma cash flow statement is prepared between three to five consecutive years.
However, longer periods are sometimes needed depending upon the projects
undertaken. The pro forma cash flow statement must be able to show the following
information:
● Cash inflows – the projected amount of cash flowing into the company.
● Cash outflows – the projected amount of cash flowing out of the company.
● Cash deficit or surplus – the difference between cash inflows and cash
outflows.
● Cash position – the beginning and ending cash balances for a particular period.

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CASH FLOW PRO FORMA STATEMENT

YEAR 1 YEAR 2 YEAR 3

CASH INFLOW

Capital (Cash) 2,000,000 0 0

Loan 0

Cash Sales 2,499,980 2,999,990 3,249,960

Collection of Accounts
Receivable

TOTAL CASH INFLOW 4,499,980 2,999,990 3,249,960

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CASH OUTFLOW

Administrative Expenditure

Salaries and wages 497,196 497,196 497,196

Utilities 9,000 9,000 9,000

Rental 24,000 24,000 24,000

Marketing Expenditure

Business card 2,160 2,160 2,160

Delivery Expenses 120,000 120,000 120,000

Advertising 43,345 33,345 33,345

Operations Expenditure

Salaries, EPF & SOCSO 37,500 37,500 37,500

Operation Overhead & Utilities 357,140 428,570 464,280

Raw Materials 922,135.48 1,106,567.74 1,198,770.96

Other Expenditure

Pre-operations

Deposit (rent, utilities, etc.) 5,000 5,000 5,000

Business Registration & 1,500 1,500 1,500

Licenses
10,000 10,000 10,000
Insurance & Road Tax for
Motor Vehicle

Permit 100 100 100

Other Pre-operations
Expenditure

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Fixed Assets

Purchased of Fixed Asset-

others

Patent 2,500 2,500 2,500

Vehicles 100,000

Office building 250,000

Machinery and equipment 350,000

Office equipment 55,000

Loan Repayment

Principle

Interest

Tax Payable

TOTAL CASH OUTFLOW 2,786,576.48 2,277,438.74 2,405,351.96

CASH SURPLUS (DEFICIT) 1,713,403.52 722,551.26 844,608.04

BEGINNING CASH BALANCE 0 1,713,403.52 2,435,954.80

ENDING CASH BALANCE 1,713,403.52 2,435,954.78 3,280,562.84

6.5 Income Statement

The next step in developing a financial plan is to prepare the pro forma income

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statement which shows the expected profit or loss for the planned period, usually
for three to five consecutive years. Generally, the pro forma income statement
consists of the following elements:
● Cost of good manufactured (production cost)
● Gross profit
● Net profit

Cost of goods manufactured (also known as production costs) refers to the total
production cost involved in producing the finished goods. It includes all costs such
as direct materials, direct labor, manufacturing overheads and the differential value
between the beginning and ending balances of the work-in-progress (if any). Gross
profit is the gross margin realized after deducting the cost of goods sold from sales.
It represents the amount of profit before deducting other operating expenditure. Net
profit (or net loss) is defined as the difference between gross profit and operating
expenses for the planned period.

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PRODUCTION COST PRO-FORMA STATEMENT

YEAR 1 YEAR 2 YEAR 3
Raw Materials
Opening Stock 0 143,996.4 90,370
Current Year Purchases 922,135.48 1,106,567.74 1,198,770.96
Ending Stock 143,996.4 90,370 65420
Raw Materials Used
778,139.08 1,160,194.14 1,264,190.96
Carriage Inward
80,000.00 80,000.00 80,000.00
858,139.08 1,240,194.14 1,344,190.96
Labour (Salaries & wages) 37,500 37,500 37,500
Factory Overhead
Depreciation of Fixed assets 137,750 137,750 137,750
(Operations)
Operation Overhead & Utilities 357,140 428,570 464,280

Total Factory Overhead 532,390 603,820 639530

Production Cost 1,390,529.08 1,844,014.14 1,83,720.96

PRO-FORMA INCOME STATEMENT

YEAR 1 YEAR 2 YEAR 3
Sales 2,499,980 2,999,990 3,249,960
Less: Cost of Sales
Opening Stock of Finished Goods 0 18,000 22,000
Production Cost 1,390,529.08 1,844,014.14 1,983,720.96
Less: Ending Stock of Finished Goods 18,000 22,000 27,960

1,372,529.08 1,840,014.14 1,977,760.96

Gross Profit 1,127,450.92 1,159,975.86 1,272,199.04
Less: Expenditure
Administrative Expenditure 273,000 273,000 273,000
Marketing Expenditure 165,505 155,505 155,505
Other Expenditure
Business Registration & Licenses 1,600
Insurances & Road Tax for Motor V 10,000 10,000 10,000
Vehicle
Other Pre-Operations Expenditure
Interest on Loan 19,400 19,400 19,400
Depreciation of Fixed Assets
Administrative)

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Total Expenditure 469,505 457,905 457,905

Net Profit Before Tax 657,945.92 702,070.86 814,294.04
Tax(25%) 164,486.48 175,517.72 203,573.51
Net Profit After Tax 493,459.44 526,553.14 610,720.53
Accumulated Net Profit 493,459.44 526,553.14 610,720.53

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7. PROJECT MILESTONES

Activities Commencement Deadlines

date
Incorporation of the venture
10 April 2023 11 April 2023
Completion of design and development
15 April 2023 20 April 2023
Completion of prototypes
21 April 2023 28 April 2023
Obtaining of sales representatives
1 May 2023 3 May 2023
Signing of distributors and dealers
5 May 2023 6 May 2023
Ordering of materials in production
10 May 2023 17 May 2023
quantities
Starting of production or operations
20 May 2023 20 June 2023
Receipt of first orders
23 June 2023 28 June 2023
Delivery of first sales
1 July 2023 5 June 2023

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8. CONCLUSIONS

In conclusion, the company's business plan lays a solid platform for success in the smart
umbrella market. The organization seeks to gain a sizable portion of the target market by
utilizing cutting-edge technology, emphasizing differentiation, and placing a high priority
on customer happiness. Through strategic pricing, market penetration, brand loyalty, and
strategic collaborations, the venture's profitability is projected. With their knowledge and
track records, the carefully chosen management team will lead the business ahead and
ensure efficient decision-making and execution of essential responsibilities. Legal,
accounting, advertising, consulting, and banking support services will help the business
expand and run more effectively. The company will become a dominant force in its
sector thanks to its dedication to excellence, innovation, and customer-centricity. With a
plan in place, the business is prepared to navigate the market, overcome obstacles, and
prosper in the changing environment of smart umbrellas.

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9. APPENDICES

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