Description
It describes about the usability of such an online portal and how it is used by both the faculty and the students.It has a broad agenda covering the business and revenue model. It then goes on explaining the market opportunity and the competitive landscape. Further it analyzes the scalability and the sustainability of such a product. Then it winds up with the marketing and promotional activities and also the break even analysis for the online portal.
ePareeksha.com
The E- Business Plan Report
Table of Contents
Motivation for Business Idea .......................................................................................................... 3 Business Idea .................................................................................................................................. 3 Business Model ............................................................................................................................... 4 Revenue Model ............................................................................................................................... 5 Market Opportunity ........................................................................................................................ 6 Competitive Landscape ................................................................................................................... 6 Product Offering ............................................................................................................................. 7 Scalability & Sustainability ............................................................................................................ 8 Operations ..................................................................................................................................... 10 Marketing and Promotion ............................................................................................................. 12 Break Even Analysis ..................................................................................................................... 14
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Motivation for Business Idea
Common entrance test for professional courses like engineering and medical is a stepping stone for success in India. Students are under stress to perform their best in these common entrance tests. This is because of the increasing emphasis on higher education by the middle class in India. We also went through the same grind during the entrance exams. As we look back we realized that entrance tests was not only about hard work and practice which is in turn dependent on ? ? ? The student’s relative standing with respect to his competitors Continuous feedback on the student’s performance Access to wide range of test series
The students are generally stuck to course material and test series from one or two coaching classes. They are apprehensive about the range and quality of material available to them. All the above factors lead us to think about an online test series. The Common entrance tests are multiple choice questions and hence amenable to online testing. With the wide spread use of internet among students in India, an online test series would provide the students access to innumerable test series and experts across India. Currently every state board, IITs, NITs, deemed universities have their own entrance exams. The HRD ministry is also intending to have a single entrance test for all engineering and medical colleges. This is another motivation for the business idea as the competition for students will be across India and is not restricted to their states.
Business Idea
ePareeksha.com is an online portal for test series targeted at students intending to write engineering and medical entrance tests across India. It will provide both topic wise and full range tests. It provides platform for testing and in-depth analyses of test results. It also provides an opportunity for experts and teachers across India to have an additional source of income.
3|Page
Business Model
The faculty and experts will upload both topic wise tests and full range tests. Along with it they will also provide solutions to these tests. Along with tests they will also provide topic wise tutorials which will be taught with the help of software. The software will play video as well as audio; hence it will give a feel like it is being taught in the classroom. The software will have to be downloaded by the medical and engineering aspirants. Once they have downloaded they will be provided free tutorials to some topics. After the free trial they will have to pay for answering topic wise or full range tests. Once, the applicant pays she/he will be allowed to download the test with the help of software. They will be able to take the test on this software, after marking the answers the aspirants will have to upload the file to the server along with the rating for a particular test. After uploading the file the aspirants will be able to check their results. ePareeksha.com will also provide a platform in which both aspirants and experts interact. The interaction can be either among aspirants or between experts and aspirants. The experts will provide valuable feedback while solving aspirants’ doubts. Along with the tests and tutorials, ePareeksha.com will also provide analysis to each aspirant. The analysis will be performance of aspirant across India. It will also include performance of the aspirant topic wise with the feedback as to which topics the individual is weak in and at the same time in which others are strong in. Other analysis will be on the similar lines. Once ePareeksha.com is able to attract a certain number of aspirants it will be able to approach colleges, coaching institutes, book publishers, etc for promotion. This will provide another stream of revenue for ePareeksha.com.
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Revenue Model
The faculty and experts will be paid a initial fixed amount for providing tutorials, topic wise tests and full range tests. This will be raised either through loan or through funding by venture capitalists. The variable pay to the faculty and experts will be decided after a certain number of aspirants update the rating to the topic wise test or full range tests. Once the website is up and running it will allow the aspirants to register for free and download the free material. If the aspirants are willing to upgrade to the full version they will have to pay a certain amount either through their parent’s credit card or through demand draft. Once the payment is confirmed they will be allowed to access all the material. The advertisement revenue will be earned after a certain number of aspirants register on ePareeksha.com. Once, the registration reached a particular number the coaching institutes, colleges, book publisher can be approached so that they can promote their offering to the registered aspirants.
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Market Opportunity
The number of aspirants who appeared for IIT last year was 3.84 lakhs. This number is growing by approximately 24% every year. Similarly the number of students who appeared for AIEEE last year was 9.6 lakhs with a growth rate of approximately 20%. The other exams the aspirants answered were VITEEE ? 1 lakh and AIPMT ? 1 lakh.. The number of students appearing for AIIMS in 2009 was 45,000 and those who appeared for AIPMT in 2009 was 145,200. From the above it can be noted that the future prospects of number of students answering entrance exams is bound to increase. Thereby, providing scope for targeting large number of aspirants both in medical as well as engineering aspirants.
Competitive Landscape
The existing players in the online space are as follows: ? ? ? Goiit.com EntranceCorner.com Topchalks.com
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The Brick and Mortar players in this industry are as follows: ? ? ? FIITJEE Brilliant Tutorials Akash Institute
and some of the smaller players in the Brick and Mortar Education Industry. The USP of our venture ePareeksha.com is as follows: ? ? Access to diverse set of resources for the students from faculty and experts from across the country. Extensive use of Analytics to provide the students with all India ranks on chapter-wise quizzes which would be conducted. Also providing insights on how competing students perform relatively on a particular aspect of the paper. Further providing personalized feedback to the students on areas of strength and room for improvement. At this stage none of the competitors are actually using Analytics so extensively to cater to student needs. Further a system for Questions papers to be uploaded from across the country is also not in place. Thus, we believe our venture would perform better vis-à-vis competition.
Product Offering
The various stake holders have been targeted such that the value proposition for each of these is lucrative enough to make use of the venture on offer. For Faculty and Experts: It provides a platform to sell their teaching /learning resources. With growing popularity of these teaching or learning resources, we realize that the brand equity of the concerned faculty or expert would grow.
7|Page
For Students/Aspirants: There would be a set of paid services and there would be a set of free services namely: Paid Services ? ? ? Test Series Performance evaluation & feedback Simulated lectures
Free Services ? ? ? Discussion forums Campus tours News & notifications
The above would be the product offerings to start with but these would increase with time as the business model stabilizes and becomes sustainable.
Scalability & Sustainability
Scalability The basic Value Proposition in ePareeksha.com is the question papers and answers which will be uploaded by faculty members and other experts in the domain. An important factor here is that scalability is not linearly proportionate to the critical resource. Moreover, ePareeksha.com forms a platform which provides ample opportunities to diversify in the future. For instance, the same platform could expand to provide services for GRE, GMAT and CAT aspirants as well. In the scenario of a likely expansion to other exams, the competitive advantage for ePareeksha.com would be its ability to cash in on the future benefits of good customer service. Unlike many other online, as well as, brick and mortar players, who specialize in one area of expertise, ePareeksha.com can capitalize on its brand and reputation for repeat subscriptions from ex-students. For instance, an engineering entrance aspirant, after a successful association
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with ePareeksha.com for his engineering entrance preparation, is more likely to opt for ePareeksha.com again for his future preparations for exams like GMAT, CAT, etc. Sustainability The faculty members and experts are the critical resources in this business model. The quality and commitment of this community forms the building block for ePareeksha.com. Considering this factor, there shall be no entry barrier for this group in terms of registration or subscription fee. And for the services rendered by this community, ePareeksha.com will provide commensurate monetary benefits to them. In addition to the monetary benefits, ePareeksha.com also provides a platform for these experts to build their own brand and reap the benefits of the same in their mainstream profession. The next stakeholders are the student community. Students can subscribe to the product offerings of ePareeksha.com and avail a diverse set of study resources. For the tests they attempt on ePareeksha.com, they will be given a nationwide-ranking which will help them to evaluate their performance on a wider scale. Using analytics, the performance of the students will be evaluated on a module wise level and they would also be given a personalized feedback & recommendation for future tests that suits their level of preparation. From the perspective of ePareeksha.com, the model is sustainable as it earns both subscription fees from students as well as revenue from advertisements. Potential advertisers for ePareeksha.com would be Engineering/medical colleges, other coaching institutes, publishers of entrance preparation books and other related course materials.
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Operations
FIGURE-1
Phase 1: Step-1: Whenever student will go to side s/he will Sign up free, where he will put all information like email id, Name Surname, Contact No, Education level, Address, College Name, Interest in career etc. Step-2: After student will get confirmation mail with user id and password. Step-3: Then student will direct to home page, ? Where he can update/ edit his profile, ? He can surf News & notification section, (Colleges Advertisement will be display on that) ? Go for knowledge center where student can read & rate peers and experts comment. ? Can put his comments, ask question to general or specific person ? Benefits of membership, options of membership, Procedure of membership,
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Figure-2 Phase-2 Step-1: If student wishes for membership, for payment student can opt for online (by credit card, Debit card, online banking, advance card) or offline (by Money order, Demand Draft, Bank account receipt etc) Step-2: Download Client Software, a sample of which is shown below in figure-3. Where student can download software work on that ? Reading Material ? Give test in time pressure, Give result, Analyses ? Upload data on Server ? Ask specific questions to peer and experts ? Update notification ? Before updating, subscription confirmation, Update software ? If expired, then provide options for renew membership
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Figure-3
Marketing and Promotion
? Inbound Marketing would be carried out by extensive use of blogs, youtube, twitter, facebook, orkut, linked in and other mediums suitable for it. ?
Search Engine Optimization: Search engine optimization (SEO) is the process of improving the volume or quality of traffic to a web site from search engines via "natural" or un-paid ("organic" or "algorithmic") search results as opposed to search engine
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marketing (SEM) which deals with paid inclusion. Typically, the earlier (or higher) a site appears in the search results list, the more visitors it will receive from the search engine. SEO may target different kinds of search, including image search, local search, video search and industry-specific vertical search engines. This gives a web site web presence. As an Internet marketing strategy, SEO considers how search engines work and what people search for. Optimizing a website primarily involves editing its content and HTML and associated coding to both increase its relevance to specific keywords and to remove barriers to the indexing activities of search engines The above would be the method used to promote our venture ePareeksha.com. ?
Outbound Marketing: Outbound Marketing would be carried out by way of the following: ? Initial Promotions Direct Selling to faculty and Experts so that a thorough background check is in place and also we get good quality faculty to register and upload on our site. Further we plan to conduct career counseling & Personality development sessions & interactive sessions with various entrance exam toppers in schools and pre university colleges. ? Strategic Alliances We intend to form strategic alliances with Engineering Colleges and Medical Colleges wherein we intend to gain credibility by way of our alliance with them and they would gain access to aspirants by way of our alliance with them. This would help market each other’s product successfully.
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? Advertisements Advertisements on social networking web sites and other websites which aspirants or for that matter our target segments would visit will be put in place.
Break Even Analysis
Data for the revenue and expenses of similar business models like Goiit.com, EntranceCorner.com, Topchalks.com, etc were not available in the public domain. So we took into consideration another business model for which the infrastructure requirements would be similar to ePareeksha.com. Naukri.com which maintains database of job applicants & potential recruiters and processes the same to find suitable match would require similar infrastructure as proposed for ePareeksha.com. We found out that, the Network and Infrastructure Charges incurred by Naukri.com is Rs. 3 crores for 30 lakh users. This transformed to a cost of Rs. 30 per user. Going forward by the assumption that ePareeksha.com would have, at the maximum, a user base of 10,000, the network & infrastructure expenses would be Rs. 3 lakhs (Rs. 30 *10,000.) However, drawing a linear relationship between the cost and number of users would not be a prudent approach. The ‘per user’ cost for the network & infrastructure expenses comes down as the user base grows as in the case of Naukri.com. This is because setting up the infrastructure would incur some fixed cost and other expenses. So, going by a conservative approach, we assume the minimum cost for setting up the network and infrastructure for ePareeksha.com to be Rs. 10 lakhs. The total number of staff employed by ePareeksha.com during the first year of its operation would be 25. The salaries of the employees would vary based upon their role and designation. An attendant or security personnel would be paid between Rs. 3,500 – Rs. 5,000 per month, while a manager would be paid between Rs. 18,000 – Rs. 25,000 per month. Taking into consideration all these factors, we assume the salary for the employees to be near Rs. 10, 0000. Thus the total employee cost incurred by ePareeksha.com would be Rs. 2.5 lakhs per month or Rs. 30 lakhs per year.
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The sum earmarked for marketing & other promotional activities like, conducting seminars in schools, is Rs. 7 lakhs. EPareeksha.com would pay an amount of Rs. 1,000 for each question paper. Assuming that 100 question papers would be uploaded by the experts during the first year, the total cost of sales would be Rs. 2 lakhs. Thus, the total cost incurred by ePareeksha.com for its first year of operation would be Rs. 49 lakhs. Taking into consideration all these costs, ePareeksha.com proposes to charge a subscription fee of Rs. 1,000 to each student. This would result in a total subscription of 4,900 students for breakeven. The summary of the same is shown in the table below.
Table: Break-even analysis Expenses Network and Infrastructure Charges Employee Costs Marketing Cost of sales Total Costs No. of users for Break even (@ Rs. 1,000 subscription fee) Rs. 10,00,000 30,00,000 5,00,000 4,00,000 49,00,000 4,900
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doc_336211058.docx
It describes about the usability of such an online portal and how it is used by both the faculty and the students.It has a broad agenda covering the business and revenue model. It then goes on explaining the market opportunity and the competitive landscape. Further it analyzes the scalability and the sustainability of such a product. Then it winds up with the marketing and promotional activities and also the break even analysis for the online portal.
ePareeksha.com
The E- Business Plan Report
Table of Contents
Motivation for Business Idea .......................................................................................................... 3 Business Idea .................................................................................................................................. 3 Business Model ............................................................................................................................... 4 Revenue Model ............................................................................................................................... 5 Market Opportunity ........................................................................................................................ 6 Competitive Landscape ................................................................................................................... 6 Product Offering ............................................................................................................................. 7 Scalability & Sustainability ............................................................................................................ 8 Operations ..................................................................................................................................... 10 Marketing and Promotion ............................................................................................................. 12 Break Even Analysis ..................................................................................................................... 14
2|Page
Motivation for Business Idea
Common entrance test for professional courses like engineering and medical is a stepping stone for success in India. Students are under stress to perform their best in these common entrance tests. This is because of the increasing emphasis on higher education by the middle class in India. We also went through the same grind during the entrance exams. As we look back we realized that entrance tests was not only about hard work and practice which is in turn dependent on ? ? ? The student’s relative standing with respect to his competitors Continuous feedback on the student’s performance Access to wide range of test series
The students are generally stuck to course material and test series from one or two coaching classes. They are apprehensive about the range and quality of material available to them. All the above factors lead us to think about an online test series. The Common entrance tests are multiple choice questions and hence amenable to online testing. With the wide spread use of internet among students in India, an online test series would provide the students access to innumerable test series and experts across India. Currently every state board, IITs, NITs, deemed universities have their own entrance exams. The HRD ministry is also intending to have a single entrance test for all engineering and medical colleges. This is another motivation for the business idea as the competition for students will be across India and is not restricted to their states.
Business Idea
ePareeksha.com is an online portal for test series targeted at students intending to write engineering and medical entrance tests across India. It will provide both topic wise and full range tests. It provides platform for testing and in-depth analyses of test results. It also provides an opportunity for experts and teachers across India to have an additional source of income.
3|Page
Business Model
The faculty and experts will upload both topic wise tests and full range tests. Along with it they will also provide solutions to these tests. Along with tests they will also provide topic wise tutorials which will be taught with the help of software. The software will play video as well as audio; hence it will give a feel like it is being taught in the classroom. The software will have to be downloaded by the medical and engineering aspirants. Once they have downloaded they will be provided free tutorials to some topics. After the free trial they will have to pay for answering topic wise or full range tests. Once, the applicant pays she/he will be allowed to download the test with the help of software. They will be able to take the test on this software, after marking the answers the aspirants will have to upload the file to the server along with the rating for a particular test. After uploading the file the aspirants will be able to check their results. ePareeksha.com will also provide a platform in which both aspirants and experts interact. The interaction can be either among aspirants or between experts and aspirants. The experts will provide valuable feedback while solving aspirants’ doubts. Along with the tests and tutorials, ePareeksha.com will also provide analysis to each aspirant. The analysis will be performance of aspirant across India. It will also include performance of the aspirant topic wise with the feedback as to which topics the individual is weak in and at the same time in which others are strong in. Other analysis will be on the similar lines. Once ePareeksha.com is able to attract a certain number of aspirants it will be able to approach colleges, coaching institutes, book publishers, etc for promotion. This will provide another stream of revenue for ePareeksha.com.
4|Page
Revenue Model
The faculty and experts will be paid a initial fixed amount for providing tutorials, topic wise tests and full range tests. This will be raised either through loan or through funding by venture capitalists. The variable pay to the faculty and experts will be decided after a certain number of aspirants update the rating to the topic wise test or full range tests. Once the website is up and running it will allow the aspirants to register for free and download the free material. If the aspirants are willing to upgrade to the full version they will have to pay a certain amount either through their parent’s credit card or through demand draft. Once the payment is confirmed they will be allowed to access all the material. The advertisement revenue will be earned after a certain number of aspirants register on ePareeksha.com. Once, the registration reached a particular number the coaching institutes, colleges, book publisher can be approached so that they can promote their offering to the registered aspirants.
5|Page
Market Opportunity
The number of aspirants who appeared for IIT last year was 3.84 lakhs. This number is growing by approximately 24% every year. Similarly the number of students who appeared for AIEEE last year was 9.6 lakhs with a growth rate of approximately 20%. The other exams the aspirants answered were VITEEE ? 1 lakh and AIPMT ? 1 lakh.. The number of students appearing for AIIMS in 2009 was 45,000 and those who appeared for AIPMT in 2009 was 145,200. From the above it can be noted that the future prospects of number of students answering entrance exams is bound to increase. Thereby, providing scope for targeting large number of aspirants both in medical as well as engineering aspirants.
Competitive Landscape
The existing players in the online space are as follows: ? ? ? Goiit.com EntranceCorner.com Topchalks.com
6|Page
The Brick and Mortar players in this industry are as follows: ? ? ? FIITJEE Brilliant Tutorials Akash Institute
and some of the smaller players in the Brick and Mortar Education Industry. The USP of our venture ePareeksha.com is as follows: ? ? Access to diverse set of resources for the students from faculty and experts from across the country. Extensive use of Analytics to provide the students with all India ranks on chapter-wise quizzes which would be conducted. Also providing insights on how competing students perform relatively on a particular aspect of the paper. Further providing personalized feedback to the students on areas of strength and room for improvement. At this stage none of the competitors are actually using Analytics so extensively to cater to student needs. Further a system for Questions papers to be uploaded from across the country is also not in place. Thus, we believe our venture would perform better vis-à-vis competition.
Product Offering
The various stake holders have been targeted such that the value proposition for each of these is lucrative enough to make use of the venture on offer. For Faculty and Experts: It provides a platform to sell their teaching /learning resources. With growing popularity of these teaching or learning resources, we realize that the brand equity of the concerned faculty or expert would grow.
7|Page
For Students/Aspirants: There would be a set of paid services and there would be a set of free services namely: Paid Services ? ? ? Test Series Performance evaluation & feedback Simulated lectures
Free Services ? ? ? Discussion forums Campus tours News & notifications
The above would be the product offerings to start with but these would increase with time as the business model stabilizes and becomes sustainable.
Scalability & Sustainability
Scalability The basic Value Proposition in ePareeksha.com is the question papers and answers which will be uploaded by faculty members and other experts in the domain. An important factor here is that scalability is not linearly proportionate to the critical resource. Moreover, ePareeksha.com forms a platform which provides ample opportunities to diversify in the future. For instance, the same platform could expand to provide services for GRE, GMAT and CAT aspirants as well. In the scenario of a likely expansion to other exams, the competitive advantage for ePareeksha.com would be its ability to cash in on the future benefits of good customer service. Unlike many other online, as well as, brick and mortar players, who specialize in one area of expertise, ePareeksha.com can capitalize on its brand and reputation for repeat subscriptions from ex-students. For instance, an engineering entrance aspirant, after a successful association
8|Page
with ePareeksha.com for his engineering entrance preparation, is more likely to opt for ePareeksha.com again for his future preparations for exams like GMAT, CAT, etc. Sustainability The faculty members and experts are the critical resources in this business model. The quality and commitment of this community forms the building block for ePareeksha.com. Considering this factor, there shall be no entry barrier for this group in terms of registration or subscription fee. And for the services rendered by this community, ePareeksha.com will provide commensurate monetary benefits to them. In addition to the monetary benefits, ePareeksha.com also provides a platform for these experts to build their own brand and reap the benefits of the same in their mainstream profession. The next stakeholders are the student community. Students can subscribe to the product offerings of ePareeksha.com and avail a diverse set of study resources. For the tests they attempt on ePareeksha.com, they will be given a nationwide-ranking which will help them to evaluate their performance on a wider scale. Using analytics, the performance of the students will be evaluated on a module wise level and they would also be given a personalized feedback & recommendation for future tests that suits their level of preparation. From the perspective of ePareeksha.com, the model is sustainable as it earns both subscription fees from students as well as revenue from advertisements. Potential advertisers for ePareeksha.com would be Engineering/medical colleges, other coaching institutes, publishers of entrance preparation books and other related course materials.
9|Page
Operations
FIGURE-1
Phase 1: Step-1: Whenever student will go to side s/he will Sign up free, where he will put all information like email id, Name Surname, Contact No, Education level, Address, College Name, Interest in career etc. Step-2: After student will get confirmation mail with user id and password. Step-3: Then student will direct to home page, ? Where he can update/ edit his profile, ? He can surf News & notification section, (Colleges Advertisement will be display on that) ? Go for knowledge center where student can read & rate peers and experts comment. ? Can put his comments, ask question to general or specific person ? Benefits of membership, options of membership, Procedure of membership,
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Figure-2 Phase-2 Step-1: If student wishes for membership, for payment student can opt for online (by credit card, Debit card, online banking, advance card) or offline (by Money order, Demand Draft, Bank account receipt etc) Step-2: Download Client Software, a sample of which is shown below in figure-3. Where student can download software work on that ? Reading Material ? Give test in time pressure, Give result, Analyses ? Upload data on Server ? Ask specific questions to peer and experts ? Update notification ? Before updating, subscription confirmation, Update software ? If expired, then provide options for renew membership
11 | P a g e
Figure-3
Marketing and Promotion
? Inbound Marketing would be carried out by extensive use of blogs, youtube, twitter, facebook, orkut, linked in and other mediums suitable for it. ?
Search Engine Optimization: Search engine optimization (SEO) is the process of improving the volume or quality of traffic to a web site from search engines via "natural" or un-paid ("organic" or "algorithmic") search results as opposed to search engine
12 | P a g e
marketing (SEM) which deals with paid inclusion. Typically, the earlier (or higher) a site appears in the search results list, the more visitors it will receive from the search engine. SEO may target different kinds of search, including image search, local search, video search and industry-specific vertical search engines. This gives a web site web presence. As an Internet marketing strategy, SEO considers how search engines work and what people search for. Optimizing a website primarily involves editing its content and HTML and associated coding to both increase its relevance to specific keywords and to remove barriers to the indexing activities of search engines The above would be the method used to promote our venture ePareeksha.com. ?
Outbound Marketing: Outbound Marketing would be carried out by way of the following: ? Initial Promotions Direct Selling to faculty and Experts so that a thorough background check is in place and also we get good quality faculty to register and upload on our site. Further we plan to conduct career counseling & Personality development sessions & interactive sessions with various entrance exam toppers in schools and pre university colleges. ? Strategic Alliances We intend to form strategic alliances with Engineering Colleges and Medical Colleges wherein we intend to gain credibility by way of our alliance with them and they would gain access to aspirants by way of our alliance with them. This would help market each other’s product successfully.
13 | P a g e
? Advertisements Advertisements on social networking web sites and other websites which aspirants or for that matter our target segments would visit will be put in place.
Break Even Analysis
Data for the revenue and expenses of similar business models like Goiit.com, EntranceCorner.com, Topchalks.com, etc were not available in the public domain. So we took into consideration another business model for which the infrastructure requirements would be similar to ePareeksha.com. Naukri.com which maintains database of job applicants & potential recruiters and processes the same to find suitable match would require similar infrastructure as proposed for ePareeksha.com. We found out that, the Network and Infrastructure Charges incurred by Naukri.com is Rs. 3 crores for 30 lakh users. This transformed to a cost of Rs. 30 per user. Going forward by the assumption that ePareeksha.com would have, at the maximum, a user base of 10,000, the network & infrastructure expenses would be Rs. 3 lakhs (Rs. 30 *10,000.) However, drawing a linear relationship between the cost and number of users would not be a prudent approach. The ‘per user’ cost for the network & infrastructure expenses comes down as the user base grows as in the case of Naukri.com. This is because setting up the infrastructure would incur some fixed cost and other expenses. So, going by a conservative approach, we assume the minimum cost for setting up the network and infrastructure for ePareeksha.com to be Rs. 10 lakhs. The total number of staff employed by ePareeksha.com during the first year of its operation would be 25. The salaries of the employees would vary based upon their role and designation. An attendant or security personnel would be paid between Rs. 3,500 – Rs. 5,000 per month, while a manager would be paid between Rs. 18,000 – Rs. 25,000 per month. Taking into consideration all these factors, we assume the salary for the employees to be near Rs. 10, 0000. Thus the total employee cost incurred by ePareeksha.com would be Rs. 2.5 lakhs per month or Rs. 30 lakhs per year.
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The sum earmarked for marketing & other promotional activities like, conducting seminars in schools, is Rs. 7 lakhs. EPareeksha.com would pay an amount of Rs. 1,000 for each question paper. Assuming that 100 question papers would be uploaded by the experts during the first year, the total cost of sales would be Rs. 2 lakhs. Thus, the total cost incurred by ePareeksha.com for its first year of operation would be Rs. 49 lakhs. Taking into consideration all these costs, ePareeksha.com proposes to charge a subscription fee of Rs. 1,000 to each student. This would result in a total subscription of 4,900 students for breakeven. The summary of the same is shown in the table below.
Table: Break-even analysis Expenses Network and Infrastructure Charges Employee Costs Marketing Cost of sales Total Costs No. of users for Break even (@ Rs. 1,000 subscription fee) Rs. 10,00,000 30,00,000 5,00,000 4,00,000 49,00,000 4,900
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doc_336211058.docx