Business Plan: Launching a New Venture for Pharmacy Farm

This project outlines the launch of 'Pharmacy Farm,' an online pharmacy venture, providing a detailed business plan. The assignment begins with a background analysis, emphasizing the impact of the COVID-19 pandemic and the growing online retail sector. It includes an STP analysis (Segmentation, Targeting, Positioning) to define the target customer base and a Porter's Five Forces analysis to assess the competitive environment. The project identifies required resources, conducts a SWOT analysis, and explores essential entrepreneurial skills. Furthermore, it details the use of various promotional tools, including a comprehensive marketing mix and promotional plan, encompassing pre-launch and post-launch activities. The assignment also provides an itemized cash flow projection for pre-launch and the first twelve months of operation, along with an overview of the legal structure of the business. The plan aims to establish a competitive online pharmacy, leveraging digital platforms and promotional strategies to attract and retain customers. The project provides a comprehensive guide for launching and managing a new venture in the pharmaceutical sector.

LAUNCHING A NEW VENTURE

Table of Contents
LO 1.................................................................................................................................................3
Background.................................................................................................................................3
STP..............................................................................................................................................3
Porter five forces.........................................................................................................................4
Resources....................................................................................................................................4
SWOT.........................................................................................................................................5
LO 2 ................................................................................................................................................6
Entrepreneurial skill....................................................................................................................6
Entrepreneurial skill Developing Time.......................................................................................6
LO 3.................................................................................................................................................6
Use of various promotional tools................................................................................................6
LO 4...............................................................................................................................................10
Itemised cash flow for pre- launch and 12 months after launch...............................................10
Legal structure of business........................................................................................................12
REFERENCES..............................................................................................................................13

LO 1
Background
Covid 19 pandemic had drastically changed the lifestyle of many. Usage of internet has eventually increased in the recent time,
all the customer is very much driven to operate different activity with the help of the internet and online platform. Online retail
industry is one of the few industries along with pharma industry has seen good sort of the growth in the recent time. For the same
reason we are looking to launch a new venture which will be offering the medicine and medical equipment on online platform . Name
of venture will be “Pharmacy farm”, Venture will be providing the services all over the UK, in initial stage company will be just
operating on online platform. On the basis of performance of company, organization will be taking decision in regard to opening
physical stores in the market.
STP
Selecting Target customer base is really a tough task, As medicine are one commodity which is required by all individual
irrespective of age, colour and preference of individual. Target customer base will be selected by applying STP analysis. STP analysis
for the new venture is as follows:
Segmentation: This is the stage on which different segment will be made on the basis of the age of the customer and medical
health of the customer. Segmentation work will be done by outsourcing the work to the third party outsourcing firm in the market.
Targeting: It is next stage in STP process, It is the stage on which organization will be targetting the best segment out of the
all segment left in front of organization. In regard to the current venture company will be targetting the age group of 18-40 years as
they are the one who are decision maker in the family. Also, they are the one who are attracted toward the online shopping the most.
Positioning: Company will be positioning the product of the company with the help of different promotional platform. So that
large number of consumer are generally attracted toward the product of the company in the market.

Porter five forces
Threat from existing organization: Looking at the threat from existing organization in the industry, it had been analysed that
this threat is not that big threat for the company at all. It had been seen that there are many few numbers of organization who used to
operate online and attracted the eye of customer product.
Threat from new entrant: This threat is medium for the company. Reason behind the same is that there are much legal
compliance linked with entering into online market this is positive sign for the company. At the same time if any new entrant comes
into the market, it will create the variety of the issue for the organization in term of increasing competition.
Bargaining power of customer: This threat is very much Low, as all the prices are generally derived by the regulatory body
in the market this generally used to Lower down the amount of the bargaining power in hand of customer.
Bargaining power of supplier: This threat is somewhat high, as there are many few suppliers who used to supply the raw
material (Tsolakidis, Mylonas and Petridou, 2020). This generally used to give them good hand of power in their hand.
Threat from substitute product: This threat is very much low, as there is no such commodity which can be called as a
substitute of medicine in the market.
Competitive environment
With help of Porter five forces it is seen that the competition within the industry is very high. Thus, for the effective entry in the
market it is of much importance for the company Pharmacy farm to make effective use of the promotional activities so that they can
secure a competitive position within the highly competitive market. This assist the company in planning effectively to address the
competition which is high in the present industry.
Resources
There are variety of the different type of the resources which will be required by the organization to operate or start the venture.
Some of the resources which will be required by the entrepreneur is as follows:

 Human Resources: Entrepreneur will require a good sort of Human resources in the organization to carry out variety of
different operation of the company. Human resources will eventually drive the different operation of company. They will
require, 300 employees for operational work and 600-800 delivery boy as well.
 IT Resources: As company will be operating with the help of the online platform they will require a good amount of the IT
resources in the new venture of the company. IT resources are internet, computers etc.
 premises- this is the most important resource as if the company will not be having any of the place to operate then this will be
tough for the company to operate in effective manner.
SWOT
Strength
Biggest strength of this type of the venture is that this is one of the most trending and growing industry. This will eventually
help the venture at the time of attracting the eye of different individual toward the product of the venture. Another strength is that there
is good demand of the same, it will help the company in seeing competitive advantage (Kirkley, 2016).
Weakness
This venture will require good amount of the capital to be invested by the owner. This will increase the risk factor for the
company in the long operation of the same.
Opportunity
There is good opportunity in front of the organization to attract the eye of young consumer, as they are very much attracted
toward the new technology which are present in front of them in the market (Kuratko and Hornsby, 2017).
Threat
There is high level of compliance involved in the Pharma industry. Hence, there is high level of legal threat for the company in
the market.

LO 2
Entrepreneurial skill
There are variety of the different type of the skill which need to be possessed by the entrepreneur to start the new venture for
the organization. Some of the skill set are as follows:
 Decision making: It is the first skill which they are required to have reason behind the same is that there are variety of
different situation which will occur, to overcome the same they have to make sure that variety of different sort of decision are
taken by entrepreneur.
 Organizing Skill: Another skill which will be required will be organizing skill, entrepreneur has to manage variety of different
operation of business for the same reason organizing skill will be required (Nuscheler, Engelen and Zahra, 2019).
 Patience skill: It had been understood that success really takes times to come, for the same reason it is required to have good
patience skill so that good amount of working environment is maintained in the organization.
Entrepreneurial skill Developing Time
For the development of the skill of becoming an effective entrepreneur it will take a time of around 3 – 4 months. This is
particularly because of the reason that when the entrepreneur will run the business then only they will try to learn the new skills and
this will assist them in their personal as well as professional development. Hence, for running a business it is very essential for the
entrepreneur to have effective learning skill so that they can continuously work on their personal and professional development.
Further, for developing some of the skills the cost involved will be around $300-400.
LO 3
Use of various promotional tools
At time of launching a new venture the most important thing for the launch is to promote the product and services in effective
and efficient manner. For this there are different types of promotional activities which xyz can use for promoting its new venture.

Thus, for this the most important thing for company is to decide for marketing mix. The marketing mix is defined as the strategy
which decides all the aspect relating to the launch of business and its promotion (Géraudel, Gast and Gundolf, 2017).
Marketing mix of Pharmacy Farm
Element Description
Product The product is a thing or service which the company sells in the
market. In the present case of Pharmacy Farm the product is the
medicines and the medical equipment which company sells with
help of an online platform (The marketing mix 4P's and 7P's,
2020). With respect to the current pandemic situation many
people are not going out much and doing online shopping for
many products. So the Pharmacy Farm will provide all its
medical facilities online.
Price The price is referred to as the amount of money which the
consumer pays for using the product and services of company.
As this is a new business so the company will first set its price
very low and then if consumer will like it then it will increase
their prices. For this Pharmacy Farm will make use of the
penetration pricing method. This method states that prices at first
must be charged very low and as the product and services of
company will penetrate in the market then prices can be
increased.
Place The place is referred to as the place through which the company

will provide its product and services to the consumers. It is very
important for company to have effective distribution system
because if consumer will not get the products on time and in
proper condition then this will affect the company to a great
extent. For this Pharmacy Farm uses only online platform to
provide its product and services to the company (Acs, Szerb and
Lloyd, 2017). Under this the consumer directly select the product
and services which they want and then places and order and after
this company delivers the product or service to the consumer.
Promotion This is the most important decision to be taken in order to
promote the product or service within the highly competitive
market. The promotion is defined as a type of marketing through
which company tries to tell the consumer the benefits of using
the product and services and influence then to purchase the
products. For this Pharmacy Farm majorly lay its emphasizes
over the social media marketing (Kuratko and Hornsby, 2017).
The major reason underlying this fact is that this is an online
business and in this current modern world the consumer are very
much attracted towards using the social media. Hence, for this
Pharmacy Farm majorly uses the social media marketing in order
to promote the product and services of the company.

Promotional plan- this is a plan which includes all the activities which are necessary for the promotion of the product and
services in the highly competitive market. This includes details of each and every promotional activity which is necessary in the
promotion of the product and services among the consumers. The major promotional plan activities are as follows-
Pre- launch activities- this is also very important for the company to provide some pre- launch benefits to the consumer as this
will attract more of the consumers towards the product and services of company. This also includes different offers which Pharmacy
Farm can provide to its consumers (Auschra and et.al., 2019). This includes to give 20 % off on the first 50 orders, 10 % off on next
50 consumers. This will attract more of the consumer to order medicine from Pharmacy Farm.
Post launch activities
Social media marketing- under this Pharmacy Farm will create a page over the different social media platforms like Facebook,
Twitter, Instagram and many others. For this company will post all the details and benefits of the product and services over the social
media pages for consumer to review (Kuratko and Hornsby, 2017). The content need to be selected in such a way that it is very brief
and to the point so that consumer can understand the utility of the product. This will attract the consumer, and they will buy the
product and services to a great extent.
Word of mouth- this is another major type of promotional activity that will be used by the company in their promotional plan.
Under this the company will provide all its product and services in such a manner that it satisfies the consumer, and they promote
these products and services by recommending to other people as well.
All these activities will take a time frame of around 2 – 3 months for arranging for the marketing activities of company. This is
necessary as if before launching the venture the consumers are not aware of the company and its details then they will not purchase the
product or services. Thus, this will decrease the goodwill of the company before the company is being launched.

LO 4
Itemised cash flow for pre- launch and 12 months after launch
Pre- launch of product- the pre- launch includes the activities and expenses which are undertaken before the launching of the
new venture. This includes expenses like development of the business plan that what will be done, how will it take place and related
things. Further another major expense will be like of researching, cost of borrowing finance and deciding for the distribution channel.
The budget for pre- launch of product is as follows- (Baručić and Umihanić, 2016)
Expenses Amount
Developing business plan 2750
Research expenses 1000
Cost of borrowing finance 1500
Material and equipment 1250
Distribution channel 2500
Social media marketing expenses 1650
Inventory cost 1950
Total 12600

Post launch
Particular January
Februar
y March April May June July
Augus
t
Septembe
r October
Novembe
r
Decembe
r
Cash inflows
OP cash flow 3000 34000 64500 67750 70250
6175
0
5250
0 44500 37350 38250 37750 33150
revenue 50000 55000 35750 30000 22500
2000
0
1900
0 22000 25000 24500 23455 24560
other cash
inflow
sources 20000 20000 10000 20000 10000 9000 9500 8000 10000 8500 7500 2740
Total cash
inflow 73000 109000
11025
0 117750
10275
0
9075
0
8100
0 74500 72350 71250 68705 60450
Cash outflow
Material 20000 25000 22000 25750 20000
1850
0
1800
0 17500 16550 17850 18555 20000
Labor 8000 9000 8500 9250 10000 9500 9000 10000 8550 7150 6500 5500
Administrativ
e and selling 5000 5000 5000 5000 5000 5000 5000 5000 5000 5000 5000 5000
Others 6000 5500 7000 7500 6000 5250 4500 4650 4000 3500 5500 7500
Total cash
outflow 39000 44500 42500 47500 41000
3825
0
3650
0 37150 34100 33500 35555 38000
Surplus or
deficit 34000 64500 67750 70250 61750
5250
0
4450
0 37350 38250 37750 33150 22450

From the above it can be seen that the anticipated profit for Pharmacy Farm is very fluctuating. This is particularly because of the
reason that the expenses of company are very much fluctuating. This is particularly because this is a new venture and there are also
may changes in the business environment. Thus, for this it is advisable to Pharmacy Farm that they must constantly research for the
different alternative so that they can find some suitable options in less cost.
Calculation of BEP
Particulars Formula Amount
Selling price per unit 35
Less: VC per unit 15
Contribution Selling price- VC 20
FC 6000
BEP (units) Fixed cost/ contribution 300
BEP (rupees) 10500
From the above table it can be seen that if Pharmacy Farm will produce 300 units then they will be in a position of no profit
and no loss situation. Hence, if it will try to product above 300 units then this will be the profit for the company.
Legal structure of business
The structure of the business will be of sole trader as this will be more beneficial for the success of the business. The business
set up is of medium scale and for this it will be beneficial for the company as there will be single owner and this will assist in
managing the business all alone. In sole trader there is a single owner who is responsible for the whole running of the business and all
the profit and loss are being bear by them only (Kriemadis, 2018). Hence, in Pharmacy Farm as well the business type will be of sole