Project Management: Child tracking watch in eKAVACH

This paper depicts the role of business planning in terms of operation, finance and strategies before developing, implementing and launching any new product in a competitive market place.

Running head: PROJECT MANAGEMENT
Project Management: Child tracking watch in eKAVACH
Name of the student:
Name of the university:

1PROJECT MANAGEMENT
Cover letter
To,
The sponsor,
ABC digitals
I would like to inform you that due to the current concern regarding criminal activities in
terms of child abduction our company are focusing on design and development of a children
tracking watch. If we successfully complete the product and launch it in the market then I can
make sure that these issues will be easily resolved. We need commercial and economical support
from your end.
Our company will be grateful if you expand your partnership or sponsorship and help us
to design and promote this safety product.
Thanks and regards,
Project manager
eKAVACH

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Executive summary
This paper depicts the role of business planning in terms of operation, finance and strategies
before developing, implementing and launching any new product in a competitive market place.
Timeline, resources and respective budget have been estimated and elaborated in this business
plan report. The product and company nominated for the business plan is a children tracking
watch of eKAVACH. If is assumed that if all the mentioned specifications and properly followed
by the manpower including project manager then it will give commercial revenue to the
company and enhance the security of the children all over.

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Table of Contents
Background of the business/company: eKAVACH........................................................................4
1. Opportunity analysis....................................................................................................................4
1.1 Identification of the market need/Problems...........................................................................4
2. Market and sales strategies..........................................................................................................5
2.1 Products and services.............................................................................................................5
2.2 Industry analysis....................................................................................................................5
2.2.1 Porters Five forces..........................................................................................................6
2.3 Market analysis......................................................................................................................7
2.3.1 Competitor’s analysis.....................................................................................................7
2.4 Marketing strategies...............................................................................................................8
2.4.1 4P’S marketing mix........................................................................................................9
2.4.2 SWOT analysis...............................................................................................................9
2.5 Marketing budget.................................................................................................................10
3. Operational requirements...........................................................................................................11
3.1 Operation process or process flow.......................................................................................11
3.2 Production schedule.............................................................................................................12
3.3 Layout..................................................................................................................................12
4. Management and personal requirements...................................................................................13
4.1 Vision, goals and objectives................................................................................................13
4.1.1 Vision............................................................................................................................13
4.1.2 Goals.................................................................................................................................13
4.1.3 Objectives.....................................................................................................................14
4.2 Management plan.................................................................................................................14
4.3 Organization chart...............................................................................................................15
4.4 Human Resource Management plan....................................................................................15
4.4.1 Manpower plan.............................................................................................................15
4.4.2 Schedule of task and responsibilities............................................................................16
4.4.3 Schedule of remuneration.............................................................................................17
4.4.4 List of office equipments..............................................................................................17
4.5 Implementation plan............................................................................................................18
4.7 Summary..............................................................................................................................19
5. Financial prediction...................................................................................................................19

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5.1 Project implementation cost schedule.................................................................................19
5.2 Sources of Finance Schedule...............................................................................................20
5.3 Profoma cash flow statement for 3 years.............................................................................21
5.4 Profoma income statement for 3 years................................................................................23
5.5 Profoma balance sheet for 3 years.......................................................................................23
5.6 Financial analysis.................................................................................................................25
5.7 Summary..............................................................................................................................26
References..................................................................................................................................27

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Background of the business/company: eKAVACH
Strapping a latest smart piece of technology in the child’s wrist helps to make much sense
that may think these days. There are many technology based innovation companies available in
Malaysia that is focused on innovating new devices to track children every time. This report
depicts the importance and crucial necessity of implementing a watch with GPS tracking that can
track current location of the children easily. In these days of frauds, scams surfing and cyber
bullying it is much natural for the parents to feel worries about their children. Innovation of such
device will help to rescue the child even from any difficult situations also.
Many companies are there which give all in one digital platform to track children but
eKAVACH holds certain features in terms of getting real time alerts, web filtering and
application management. eKAVACH gives the parents authorization to block some web
categories, websites and content as well. The time limit can be limited on the web surfing by the
parents. In fact, online activities of children can also be tracked with application of this tracking
watch. The parents can also receive alerts regarding the working. The device is a GPS and GSM
card enabled device those are wearable by the children.
1. Opportunity analysis
1.1 Identification of the market need/Problems
The wearable child tracking watches and the manufacturing companies are about to
explode the competitive digital market place. These days one of the biggest challenges for
wearable market, that is expanding industry of the kids are lack of security. Lack of security of
these devices fails to obey the child’s privacy laws and regulations. Thus, they innovators should

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make sure that these devices are completely secured from the external attacks before launching
them in the competitive market. None of the adult watches compliant to the Children Online
Privacy Protection Act (COPPA). The safety networks are also required to be highly secured
from frauds and towards technical improvement. It helps to spread cyber awareness among the
society and among the parents also during their school and tuition period.
2. Market and sales strategies
2.1 Products and services
eKAVACH develops and distributes location detector devices mainly for the children.
Apart from this, the company also delivers different innovative IOT based technical devices to
their regular consumers. Initially this manufacturing was done under subcontract and further they
started developing supporting software and internal system. The company plans to manufacture
the products in house even in the future years. The proprietary technologies used by eKAVACH
allow most of the systems to work without and with presence of cellular towers that enables its
use regardless of the location. The devices developed by eKAVACH are customized by end
users.
2.2 Industry analysis
The founders of eKAVACH are associated to the digital innovation market for a longer
time period. The digital industry is not limited rather there are many similar types of companies
available in the market who also delivers the similar products and services o the consumers.
Therefore, in order to obtain long-term success and commercial revenue in the competitive
market, eKAVACH should incorporate new experiences and digital innovative ideas to it.

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2.2.1 Porters Five forces
Power of the consumers: In these days due to heavy increase of frauds and criminal
activities the parents are much eager to avail child tracking watches to track timely location of
their children. The enhancing rate of demand will increase the sales growth and commercial
revenue of the company.
Power of the suppliers: The supply company is also designing, developing and delivering
the children tracking watches with changing additional technical security features.
Figure 1: Porter’s 5 forces
(Source: Adi 2015, pp- 34)
Threat of new entries: Many similar companies are there that are offering similar
products to the consumers. In order to avoid these threats and challenges the company is required
to build its own customer base and then competitive strategies for the new entries.

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Threats of the substitutes: The substitute companies are also reasons of threat to the
company.
Intensity of rivalry: The degree of rivalry for the children tracking watch developing
company is high. Therefore, the intensity of rivalry is also growing for the nominated company.
2.3 Market analysis
The primary targets of the manufacturing company are the children but, the market is not
limited to consumers, families. It has been analyzed that these days safety and security of the
children is one of the major concerns and in order to avoid the issues of frauds the parents should
use the children tracking watches.
2.3.1 Competitor’s analysis
Factors eKAVACH Competitor 1: Louis
Vuitton
Competitor 2:
Huawei
Lower price 3 5 5
Superior quality 4 4 4
Onboard control
approach
Yes No Yes
Installation Yes No Yes
Operators training Yes No No
Customized products 5 5 4
Unique features 5 4 5
Rapid delivery 4 5 5

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The target audiences of the company are mainly the children. Plenty numbers of benefits
are associated to the GPS tracking devices. There are many manufacturing companies which
have independent factories that give certain strength to both manufacturers and users. The GPS
children location tracking device is also rely upon the regional resources like capital, talent,
market, technologies that can collectively improve the competitive advantages.
eKAVACH Company predicts that the system developed by R&D department of the
company can be strongly appealed to the families due to high concern of children safety.
According to the National Crime Information Centre (NCIC) each day it is reported that more
than 2000 children are missing. It is expected that, worldwide more than 2000 children will
become safe with the use of such tracking device. As a whole it can be said that, this device can
reduce the figure of crime worldwide.
 The focus of the company is to increase the market domination and presentation
 It helps to expand the target markets by controlling the growth
 It establishes brand awareness among the users
2.4 Marketing strategies
Generally marketing strategies are applied by the marketing managers to promote their
services and products in the competitive market. Proper application of these marketing strategies
can collaborate the consumers with the developed products. The marketing strategies that should
be followed by eKAVACH Company while developing and launching the child tracking watch
are as follows:
 Defining target population and target audience for the company
 Testing the demand and interest of the audiences

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 Considering different kinds of marketing strategies
 Evaluation of the marketing strategies
 Paid advertisements for promoting the product and attract new consumers
2.4.1 4P’S marketing mix
In order to promote the product in the competitive market place the company is required
to use 4P’s marketing mix strategies. The four key elements considered for the product are
product, price, place and promotion.
Product: The product developed by the company is tangibly good for the parents and it is
designed considering health concern of the children also.
Price: Affordability of product is one of the main character which defines whether the
product is commercially beneficial for all or not.
Promotion: In order to promote the children tracking watches the company should make
partnership along with advertising agents. Social media is the best advertisement platform these
days. They should create proper differentiation between marketing and promotion by considering
communication aspects.
Place: Distribution is one key element for the placement thus placement strategy is
required to be applied by the company to gain compliment and competitive advantages.
2.4.2 SWOT analysis
SWOT analysis
Strength
 It matches the consumers demand
Weaknesses
 As the product is new in the market

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 It gives alarm and alert functionalities
 The company follows sales growth and
innovative operational strategies
thus it fails to build reputation over the
competitors
 The company is also new thus fail to
build reputation over the known
competitors
Opportunities
 Though it is designed for tracking
children but can be used for other
security purposes in future also
Threats
 Children ‘s health can be impacted
though the digital effects
 Frequent entry of similar competitors
are the other threat
2.5 Marketing budget
The mission of eKAVACH Company is to retain all existing consumers and to grab new
customers for becoming one of the leading worldwide child locator vendors. In order to promote
and launch these already designed and developed products the marketing budget which is
estimated for the coming three years are as follows:
Start up expanse for funding and start up asset
for funding
$5000
No case asset from the start up $3000
Cash requirements from the advertising start
up
$50,000
Balancing cash on starting dates $2500
Cost for advertisement $8,000

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Cost assigned for taking legal actions $3,000
Consulting cost $1,000
Utility cost $6,000
Research and development cost $2500
The online website of eKAVACH is a virtual business card as well as a portfolio and at
the same time it acts as an online corporate home for B2B investors and marketing relations. The
website showcases all the services and products details offered by the company to their
consumers. It also hosts the portfolio of the current new products and the new children tracking
watches along with its real life testimonials. The aim of the company behind developing such
app is to track the current location of the children who are either in school or tuition classes.
Online marketing using a website is one of the best or suitable way to direct the business towards
success path way.
3. Operational requirements
3.1 Operation process or process flow
The project manager and the system developers of the company should put their focus
while developing such device for the children. the tracking process of the operation process
details is shown in the below section:

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Web enabled view: The wearable device is mainly designed for the children. the web
enabled views are available in the mobile devices operated by the parents. They can see the
current timing, pulse rate etc on the device along with the current location.
Flexible API: The device is integrated to a flexible application programming interface
and a GPS tracker.
Figure 1: Process flow activities of the smart watch device
(Source: Brito and Ferreira 2015, pp-380)
Generic device gateway: The generic device gateway is carried out by the carriers. In this
case the carrier is the wearable watches. The children can check the timings in the watch.

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3.2 Production schedule
In order to design and promote the product in the market the milestones that are to be
followed is mentioned below:
Task Name Duration Start Finish
Product scheduling 53 days Tue 2/5/19 Thu 4/18/19
Prototype completion 10 days Tue 2/5/19 Mon 2/18/19
Addition of al patent applications 5 days Tue 2/19/19 Mon 2/25/19
Unit lab testing 6 days Tue 2/26/19 Tue 3/5/19
Funding 8 days Wed 3/6/19 Fri 3/15/19
Staged child abduction 9 days Mon 3/18/19 Thu 3/28/19
Begin the product sales 4 days Fri 3/29/19 Wed 4/3/19
Identification of marketing materials 6 days Thu 4/4/19 Thu 4/11/19
Broadcasting media publicity 5 days Fri 4/12/19 Thu 4/18/19
3.3 Layout
The processes and strategies keep on changing with the guidelines and demand of the
consumers. The guidelines those are to be followed by the company owners while developing the
product business operation are as follows:
 The organization must build proper foundation from the very initial. A closer knit
project team should design the shared goals of dedication to achieve the goals.
 Information should be shared among all the company departments to diminish the
risks
 Selection of proper person and assign them to proper job roles are very important
as different individual are having separate skills and talents
 The developers and project managers of the company should make proper use of
all needful information for decision making

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 Change management program are required to be implemented after considering
feedback from the internal consumers
4. Management and personal requirements
4.1 Vision, goals and objectives
4.1.1 Vision
The vision of eKAVACH is to offer secured, affordable and high quality attractive
looking watches to the target group of customer (children) to reduce the rate of criminal
activities and to give security assurance to the children regardless of their location.
4.1.2 Goals
The goal of the company is to obtain commercial revenue by 15% of the current rates in
the coming three years. The other goal of eKAVACH is to design similar products for the
military field also with some more additional features.
4.1.3 Objectives
 To become a premier vendor in the competitive market by evolving innovative
children tracking watches
 To develop additional benefit centre in terms of programming, training, seminars
etc
 To enhance the product sales rates for bringing gross margin up and to improve
the inventory turnover rates

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4.2 Management plan
The management plan for the product is developed by the management head, project
manager and the head of sales and marketing team. The Chief Information Officer (CIO)
undertook the security measurements while developing the plan. It is the responsibility of the
management team to accomplish the assigned job roles during the product start up period in such
a way so that it can represent national presence as well. Partnering with a well established
company is another way taken by the CEO to recognize and improve the brand awareness, scope
and project strength as well.
4.3 Organization chart

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Figure 2: Organizational chart of eKAVACH
(Source: Aithal 2016, pp-100)
4.4 Human Resource Management plan
4.4.1 Manpower plan
In order to develop the children smart watch product and launch it in the competitive
market the manpower list that has been planned is comprises of 10 people including project
manager, finance manager, system developer, designer, system tester, Security officer,
consultant, quality checker, resource manager and HR manager.
4.4.2 Schedule of task and responsibilities
Task Name Duration Start Finish Resource
Names
Responsibility
Product scheduling 53 days Tue 2/5/19 Thu 4/18/19
Prototype completion 10 days Tue 2/5/19 Mon
2/18/19 project manager
To complete the
project within
assigned time
and budget
Addition of all patent
applications 5 days Tue 2/19/19 Mon
2/25/19
designer, system
developer
To design the
develop the
tracking watch
considering each
security features
Unit lab testing 6 days Tue 2/26/19 Tue 3/5/19 Security officer,
system tester
Test all the parts
of the system
before
integrating those
Funding 8 days Wed 3/6/19 Fri 3/15/19 consultant,
finance manager
To invest proper
capital support
Staged child
abduction 9 days Mon
3/18/19 Thu 3/28/19 HR manager
Issues must be
analyzed by the
HR manager
Begin the product
sales
4 days Fri 3/29/19 Wed 4/3/19 resource
manager
The resource
manager and
marketing

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manager should
analyze the
current market
and take possible
actions and
strategies to sale
the products
Identification of
marketing materials 6 days Thu 4/4/19 Thu 4/11/19 project manager
All needful
marketing
materials should
be identified
Broadcasting media
publicity 5 days Fri 4/12/19 Thu 4/18/19 quality checker
The quality
checker is
responsible to
use social media
and other
advertising
platforms to
broadcast media
publicity
4.4.3 Schedule of remuneration
Manpower Year 1 Year 2 Year 3
project manager $50000 $60000 $65000
designer $50000 $55000 $57000
Security officer $50000 $50000 $50000
finance manager $50000 $50000 $50000
HR manager $0 $10000 $20000
resource manager $0 $30000 $45000
quality checker $20000 $55000 $56000
system developer $10000 $30000 $50000
system tester $25000 $45000 $50000
Consultant $20000 $22000 $25000

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4.4.4 List of office equipments
 Desktop
 Laptops
 Router
 LAN, WAN
 Cloud support
4.5 Implementation plan
Task Name Duration Start Finish Resource Names Cost
Product scheduling 53 days Tue
2/5/19
Thu
4/18/19 $14,464.00
Prototype completion 10 days Tue 2/5/19 Mon
2/18/19 project manager $2,400.00
Addition of al patent
applications 5 days Tue
2/19/19
Mon
2/25/19
designer, system
developer $2,000.00
Unit lab testing 6 days Tue
2/26/19 Tue 3/5/19 Security officer,
system tester $2,592.00
Funding 8 days Wed
3/6/19
Fri
3/15/19
consultant, finance
manager $3,072.00
Staged child abduction 9 days Mon
3/18/19
Thu
3/28/19 HR manager $1,296.00
Begin the product sales 4 days Fri
3/29/19
Wed
4/3/19 resource manager $704.00
Identification of marketing
materials 6 days Thu 4/4/19 Thu
4/11/19 project manager $1,440.00
Broadcasting media
publicity 5 days Fri
4/12/19
Thu
4/18/19 quality checker $960.00

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Figure 3: Gantt chart for the products
(Source: created by author)
4.7 Summary
The HR management plan is one of the most important factors that have to be considered
by the project manager and company CEO before initiating any project. The manpower and their
distribution should be done based on their skills and knowledge.
5. Financial prediction
5.1 Project implementation cost schedule
Project Cost Schedule YEAR 1 TOTAL
NON-RECURRING COSTS
Hardware $ 22,000.00 $ 22,000.00
Servers $ 15,000.00 $ 15,000.00
Desktop $ 10,000.00 $ 10,000.00
Telecommunication Equipment $ 4,000.00 $ 4,000.00
Software (Packaged) $ 8,500.00 $ 8,500.00
Furniture and Fixtures $ 18,000.00 $ 18,000.00
Project Organizational/Support Costs $ 4,250.00 $ 4,250.00

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Procurement $ 12,250.00 $ 12,250.00
Contract Negotiations $ 10,000.00 $ 10,000.00
Labor $ 22,000.00 $ 22,000.00
Infrastructure $ 45,000.00 $ 45,000.00
Development $ 10,750.00 $ 10,750.00
Business Process Owners (Users) $ 5,500.00 $ 5,500.00
Management $ 6,000.00 $ 6,000.00
Training of Employees (Pre-Implementation) $ 3,750.00 $ 3,750.00
Transition Costs (Parallel Systems) $ 3,000.00 $ 3,000.00
TOTAL NON-RECURRING COSTS $ 200,000.00 $ 200,000.00
RECURRING COSTS
Hardware and Software $ 22,000.00 $ 22,000.00
Software Maintenance and Upgrades $ 4,500.00 $ 4,500.00
Computer Supplies $ 12,500.00 $ 12,500.00
Desktops (Incremental to the Project) $ 3,250.00 $ 3,250.00
Help Desk Support $ 3,500.00 $ 3,500.00
Ongoing Additional Labor $ 2,500.00 $ 2,500.00
IT Staff Costs (including Benefits) $ 25,000.00 $ 25,000.00
User Training $ 1,500.00 $ 1,500.00
Telecommunications $ 1,250.00 $ 1,250.00
Office Leases $ 3,500.00 $ 3,500.00
Marketing Expenditure $ 5,500.00 $ 5,500.00
TOTAL RECURRING COSTS $ 85,000.00 $ 85,000.00
TOTAL COSTS $ 285,000.00 $ 285,000.00
5.2 Sources of Finance Schedule
Sources of Finance Schedule
Fixed Costs Particulars Amount ($)
Website Development Cost $6,000
Leased Premises Rent $3,500
License cost $5,000
Office rent $6,500
Software Maintenance and Upgrades $4,500
Wages and salary for three month $5,500
Staff training cost $3,750
Marketing and sales cost $5,500
Office equipment $7,250
IT Staff Costs $25,000

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Insurance $5,250
Computer Supplies $12,500
Desktop Incremental Costs $3,250
Project Support Costs $4,250
Procurement $12,250
Contract Negotiations $10,000
Working capital $80,000
Total Fixed Costs $200,000
Average Monthly Costs
Rent $500
Interest on loan 8% $417
Postage & Telephone $604
Gasoline and Oil $458
Salaries / Wages $292
Total Average Monthly Costs $2,271
x Number of Months: 12
Total Monthly Costs $27,250
Total Startup Expenses $227,250
Sources of funds
Owners Fund $200,000
Total Owner Funding $200,000
Loans
Bank Loan $100,000
Total Loans $100,000
Total Start up Funds $300,000
Assets
Computers and Software 18500
Furniture $18,000
Hardware and Servers $37,000
Telecommunication Equipments $4,000
Total Fixed Assets $77,500
Total Start-up Assets $377,500
5.3 Profoma cash flow statement for 3 years
(2) CASHFLOW FORECAST

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Year 1 2 3
CASH INFLOWS
Cash from Sales 3,00,000 3,45,000 4,14,000
Directors loans 1,00,000 1,00,000 1,00,000
Capital Employed 2,00,000 2,20,000 2,42,000
Other cash inflows
TOTAL CASH INFLOW 6,00,000 6,65,000 7,56,000
CASH OUTFLOWS
Payments for materials 2,10,250 2,20,763 2,38,424
operating expenses
Premises (rent, rates) 3,500 3,850 4,428
Wages and salaries 22,000 24,200 27,830
General expenses 750 825 949
Interest and bank charges payable 0 0 0
Lease payments 0 0 0
Corporation Tax 5,250 13,669 25,530
Market survey costs 4,250 4,675 5,376
Other preliminary expenses 750 825 949
capital expenditure
Plant and other capital expenditure 77,500 77,500 77,500
financing repayments
Loan repayments 8,000 8,000
TOTAL CASH OUTFLOWS 3,24,250 3,54,306 3,88,985
Cash flow summary
NET CASHFLOW FOR PERIOD 2,75,750 3,10,694 3,67,015
OPENING CASH BALANCE 2,00,000 4,75,750 7,86,444
CLOSING CASH BALANCE 4,75,750 7,86,444 11,53,459

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5.4 Profoma income statement for 3 years
(4) PROFIT AND LOSS FORECAST
Year 1 2 3
Revenue 3,00,000 3,45,000 4,14,000
Cost of sales 2,10,250 2,20,763 2,38,424
Gross profit 89,750 1,24,238 1,75,577
Gross Margin 2,87,750 3,13,106 3,54,430
Expenses/overheads
Leased Premises Rent 3,500 3,850 4,428
Wages 22,000 24,200 27,830
Administrative Expenses 750 825 949
Communication Expenses 16,500 18,150 20,873
Marketing Expenses 1,250 1,375 1,581
Rates 5,500 6,050 6,958
Insurance 4,250 4,675 5,376
Other general expenses 5,250 5,775 6,641
Interest 1,000 1,100 1,265
Project Organizational and Support Cost 8,000 8,000 9,200
Prelim expenses 4,250 4,675 5,376
Total expenses/overheads 72,250 78,675 90,476
Profit before tax 17,500 45,563 85,100
Tax @ 30% 5,250 13,669 25,530
Profit after tax 12,250 31,894 59,570
Transfer to reserves 17,500 45,563 85,100
ROC 12% 16% 27%
5.5
Profoma balance sheet for 3 years
Assets FY-1 FY-2 FY-3
Current Assets

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Cash $275,750 $310,694 $367,015
Accounts receivable $300,000 $345,000 $414,000
Total current assets $575,750 $655,694 $781,015
Fixed (Long-Term) Assets
Furniture 18,000 18,000 18,000
Hardware and Servers $37,000 $37,000 $37,000
Telecommunication Equipments $18,000 $18,000 $18,000
Computers and Software $4,000 $4,000 $4,000
(Less accumulated depreciation) $11,800 $10,900 $10,180
Total fixed assets $65,200 $48,100 $48,820
Total Assets $640,950 $703,794 $829,835
Current Liabilities
Accounts Payable 171,700 163,794 199,228
Accrued Rent $3,500 $3,8
50
$4,4
28
Bank Charges Payable $8,000 $8,0
00
$9,2
00
Income taxes payable $5,250 $13,
669
$25,
530
Accrued salaries and wages $22,000 $24,
200
$27,
830
General Expenses $750 $82
5
$949
Current portion of long-term debt $100,000 $92,
000
$84,
000
Total current liabilities $311,200 $30
6,338
$351
,164
Long-Term Liabilities
Long-term debt (Current Outstanding
Portion)
$100,000 $92,
000
$84,
000
Less: Loan Repayment $8,0
00
$8,0
00
Total long-term liabilities $100,000 $10
0,000
$92,
000
Owner's Equity
Owner's investment $200,000 $22
0,000
$242
,000
Net Profits $12,250 $31,
894
$59,
570
Reserve and Surplus $17,500 $45, $85,

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563 100
Total owner's equity $229,750 $29
7,456
$386
,670
Total Liabilities and Owner's Equity $640,950 $70
3,794
$829
,835
Common Financial Ratios Year 1 Year 2 Year 3
Debt Ratio (Total Liabilities / Total Assets) 0.64 0.58 0.53
Current Ratio (Current Assets / Current Liabilities) 1.85 2.14 2.22
Working Capital (Current Assets - Current Liabilities) 264,55
0
349,35
6
429,85
1
Assets-to-Equity Ratio (Total Assets / Owner's Equity) 2.79 2.37 2.15
Debt-to-Equity Ratio (Total Liabilities / Owner's
Equity)
1.79 1.37 1.15
5.6 Financial analysis
The owners anticipate making the initial investment of around $200,000 and obtaining a
sum of $100,000 as the loan from Bank. The business aims to attain the goal of breakeven point
before the 1st calendar year mark. In the event of making sale a 1% sales revenue will be
dispersed to the owner. A profit of $50,000 is aimed to earn by the end of three financial years
and then each year thereon.
The business would aim to earn a return on investment of 10 per cent by the end of 1st
financial year bearing in mind the rising administrative costs. The business anticipates to raise a
sum of $300,000 as the start-up costs while the remaining amount will have recognized as
working capital for the first calendar year of business operations. To ensure that the operating

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expenses are met a loan of $100,000 would be ensured to fund the operations during the first
year of operation.
5.7 Summary
Overall, the business would maintain the healthy gross margin of approximately 50% in
combination with the reasonable operational expenditure would offer sufficient cash to finance
the added business growth. The organization would maintain the healthy cash flow position that
would allow timely servicing of debt and funds that are available for future expansion. The net
worth of the company is anticipated to increase in the future years. Overall, the annual projected
sales are anticipated to grow by 10 per cent based on the industry average.
6. Others
6.1 Risk assumptions and regulations
6.1.1 Critical success factors
Analysis of critical risks
There are different risks which may collectively and negatively impact the regular
success of the project. The potential risks are as follows:
 Improper allocation of project resources
 Inaccurate estimation of project cost
 Wrong financial analysis
 Lack of communication approaches

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 Lack of skills, business practices and operational strategies among the developer
team
Assumptions
In order to resolve these potential risks the project manager and project team members
are required to estimate and assign proper budget that will be needed to complete the project.
Risk mitigation assumptions
There are different ways through which these risks can be completely mitigated. For
instance, feasibility study is the best possible approach to identify actual budget of the project.
The project manager and the project team members should use open communication approach
while interacting and sharing the creativity and innovative ideas to others. Apart from this, based
on the complexity of activities the time and cost should be assigned. Regarding business
requirements and user experiences the project manager, device designer and developers should
assign proper business operations and strategies.
Appendices
Suppliers’ quotation
“To deliver and offer affordable, quality and secured watches for the children so that their
parents can track the location of the children regardless of time and cost”.
Agreement letter
To
The sponsor

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I am writing this letter to impose the agreement dates (20/12/2017-24/11/2018). We are
requesting you to provide proper operational and financial support during these time period so
that we can offer a secured watch for our interested group of consumers. Before launching the
project we need support from your end.
Kindly sign the agreement letter so that we can get started with our design base as soon
as possible. You are requested to join with us during the mentioned dates. Please, response to
this letter as soon as possible.
-Thanks and regards
Project manager

30PROJECT MANAGEMENT
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