The concept of social business plays a prominent role in the world. Social business is an active and sustainable business form of choice which is able to provide economic, communal, and environmental benefits to the country (Kiron, Palmer and Kruschwitz, 2012). The social business created direct impact on the social values. The world is rapidly changing and also faces major challenges of being social ones (Yunus, 2017). Social business set out to use of entrepreneurial skills to make efforts to bring about the positive changes in the society (Irene, Marika and Mario, 2016). Most of the firms are now concentrating on the social business to protect the society by adopting the concept of corporate social responsibility (Byerly, 2014).
The economy of Cambodia has faced terrible problem due to the unemployment. The situation of employment in Cambodia is grave (Guo, 2017). The ratio of employment in Cambodia is quite low because of low literacy level. Only 20 % of the population has education beyond primary level (Tyner and Rice, 2016). The illiteracy affected thirty five per cent of the adult population with the rate approaching fifty per cent among women. The society of Cambodia is still facing the challenges of rebuilding and developing not only its physical and economic infrastructure but also affect the potential of human (Clayton, 2017). The development of the human potential requires the creation of an environment which is being affected due to the excess use of plastic (Hill and Menon, 2014).
The use of plastic creates great negative impact on the environment. Plastic generate the emission of carbon which take participation in the global warming (Gall and Thompson, 2015). Most of the big companies guarantee to use recyclable bottles for their product but it is hardly ever true. The company Coca-Cola sources only seven per cent of its plastic from recycled materials and Nestle Waters in North America also have a review that six per cent of their bottles are made from recycled plastic. These have created great impact on the environment at global level (Sajdak, 2017).
In the following context, there will be detailed discussion on water bottle launch in the market of Cambodia with the name of Khmer Water. It is being launch as a non-profit-organization with the motive of protecting the environment from the plastic use and caters pure water to the society.
Overview of Company
The Khmer Water supply operate a portfolio of small scale piped water networks which distribute the clean water for drinking directly to in-need households in rural areas of Cambodia. The network of each individual consists of a filtration system, ground well and water tower for storage, and underground piping which connects to the end users of households. The service provided by the company is at lower cost to the consumers than the alternatives, with significant convenience and improved status (Fletcher, 2018).
The company has a planning to introduce water bottle in the Cambodia to cater pure water to the society and protect the environment from the excess use of plastic. The recyclable plastic will be use by the company for their product.
Targeted Audience
The main targeted audience for the company will be tourist. Cambodia is one of the mysterious countries for many tourists. Therefore, there is large number of tourist visit Cambodia. According to the annual report, the Ministry of Tourism found that in 2015, most of the visitors stayed an average 6.8 days in Cambodia. The tourist of the Cambodia is other turned off by providing polluted water to them which is the main issue which are need to be addressed by the company (Guiney and Mostafanezhad, 2015). Therefore, it is the main reason to target the tourist for the product. The affluent Cambodian and socially conscious individuals is also aim of the company to cover for their product.
Mission of the company
The business canvas of Khmer is explained in below table (Osterwalder and Pigneur, 2010):
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Key Activities Sell Drinking water bottles Water purifier plants Twenty litre bottle refill Herbal Medicines for water purification Water filter |
Key Partnerships Suppliers of Material – Thermoplast Distributors – Logistic Company NGO’S Brand Celebrities Volunteers Retailers – Preserve and Physical Stores Five stars hotel Four stars hotels |
Customer Relationship The system of complaint will be efficient and effective The suggestion and recommendation of customers will be welcomed Surveys will be conducted such as feedback about the performance of company Strategies of Social Marketing Relationship with community partners in Recycling |
Value Propositions Look customers as a member or part of the customers Preference to the quality Ecological – bottle customers |
Tourists House hold Customers Business Firms School Colleges Factories Shops Other Institution
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Channels Franchise Outlets Physical Retainers Direct Website Media |
Key Resources Refilling centres The Main Factory Capital Employees Rain Water Harvesting device |
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Cost Structure Perpetual inventory system will be adopt Costs of Bottle – Material, Production, Distribution and Customer Intimacy Costs OF Foundation – Community building and Funding Projects Control Flaws and fill gaps and mistakes |
Revenue Streams 95% of revenue from sale of bottle Supporting Projects Raising Awareness Donations Cost plus pricing strategy will be used The company has to survive the Breakeven Point of maximum period of almost six month |
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Key Activities
Sell Drinking water bottles
The main activity of the company is selling the water bottle for drinking. As in Cambodia, the water is quit polluted. Therefore, the step has been taken by the company to deliver pure water to their customers (Csuros, 2018).
Water purifier plants
The purification of water is the process of removing or reducing the undesirable chemicals, biological contaminants, suspended solids, and gases from water. Thus, the plant for water purifier will be set up by the company to deliver sprinkling water to the customers of Cambodia (Krishnaraj, Yun and VK, 2017).
Twenty litre bottle refill
The company will have a target to deliver the water bottle. Therefore, the company will focus on twenty litre mineral water refills and also deliver 300, 500, 1, 2 litre of packaged drinking water
Herbal Medicines for water purification
Herbs are renowned for their anti-bacterial properties. Ayurveda mostly uses herbs such as Basil leaves, Neem, wheatgrass, and Phyllanthus emblica for purifying the water. To purify the water, company will use herbal medicines which contain such ingredients. It helps in purifying the water in decent manner (Zhang, Yu and Chen, 2015).
Water filter
It is the important ingredient for purifying the water. the company will sue water filter to cater pure water to their customers with the reason the country Cambodia has polluted water therefore, it is require for the company to set up water filter machine to cater pure water in the country.
Key Partnerships
Suppliers of Material
The company will use thermoplastic for their water bottles. Thermoplastic is a material which becomes soft when heated and get hard when cooled. Therefore, the key partner of the company will be DENSO, who deliver thermoplastic to the company
Distributors
Distributors are the important part of supply chain. Through the distributors the company can deliver their product at a greater level. The company tie up with logistic company to reach out to the customers at greater level
NGO’S
The main aim of the company is to deliver pure water with recyclable plastic to protect the environment. Therefore, the company need to connect with NGO’S to promote and support their product at greater level. The key NGO’S partner of the company will be The Cambodian Sanitation and Recycling Organization (Seng and Fujiwara, 2018)
Brand Celebrities
Some of the celebrities take participation in social activities. The customers will get more attract toward the product, if celebrity promote the product. Therefore, the brand celebrity of the company will be Preap Sovath who is a singer (Lost.fm, 2018), to promote their water bottle for social cause.
Volunteers
The company will be set up as non-profit organization therefore, the company need support of the volunteers to promote and target their product at a high level. The company partnered with volunteers to deliver and promote their product at every level and reach out with maximum customers.
Retailers
Retailers are the main participants of the product. In the market the retailers play a prominent role, they directly connect with the customers. Therefore, the company will contact with preservers and physical stores who are near the tourist destination and hotspots to sell their product at maximum level. The vendors will take the bottles on consignment at the agreed purchase price of US$1.50. The vendors are required to sell the bottle with the maximum retail price of US$2.50 (Wei, 2015).
Five stars hotel
Five starts hotels are the best way to connect with the customers at maximum level. Cambodia has a huge market of tourist. The company partnered and coordinate with few five tarts hotel such as Place Gate Hotel and Resort, Rosewood Phnom Penh, The Bale Phnom Penh Resort to target the tourist at maximum level.
Four stars hotels
To target maximum tourist, the company also coordinate with four stars hotels such as Sunway Hotel Phnom Penh, The Frangipani Living Arts Hotel and Spa, River Palace Hotel and Spa. These are such places where tourist visits the most. Therefore, the company partnered with such hotels to deliver their product at maximum level.
Customer Relationship
System of complaint will be efficient and effective
The company will provide the perfect platform to their customers, if they will not get satisfied with the product. It would be the opportunity for the company to gain the trust of customers.
Suggestion and recommendation of customers will be welcomed
The suggestions and recommendations of the customers will be warmly welcomed. It will help the company to increase their efficiency, where they lack and satisfy customers at a greater level.
Surveys
Surveys will be conducted such as feedback about the performance of company to gather the information about the performance and the deviation of the company to concentrate work on the flaws and deliver better service to the customers
Strategies of Social Marketing
The motive of the company is to deliver pure water in recyclable bottles. The company adopt various social marketing strategies such as aware about the product through face book, Instagram and other social media channel to cover the customers at maximum level.
Relationship with community partners in Recycling
The company connect with the community and take participation in recycling the product which helps the company to fulfil their objective of launching the product in the market. The local collector will be recruited and provided the branded bins which will be lockable. The collectors will collect the waste products. The material will be used in preparing the bottles. It will encourage the collection of all types for PET bottles, not just Khmer Water Bottles.
Value Propositions
Look customers as a member or part of the company
The company look their customer as a part of company and will deliver the value of being healthy with pure natural water. The value proposition of Khmer Water Bottles is that they give more for more.
Preference to the quality
The company promises to provide good quality water that the customer can drink it with the peace of mind by knowing that the water is free from any toxins which may harm their body. Therefore, company give more preference to the quality of product to cater clean water access to the customers.
Ecological – bottle customers
The main focus of the company is to provide bottles of recycling nature which may not impact on the environment negatively. The company has a main focus to deliver ecological products to reduce plastic pollution in the country.
Customers Segment
The customers are divided into different segments. The customer segment company serve are the tourists, house hold customers, business firms, school, colleges, factories, shops, and those who are aware of the health and safety concerning the water in Cambodia. The company has mainly target on the tourist. Therefore, the end users of the product will be predominantly western tourists as well as the affluent Cambodian and environmental conscious peoples. The higher price of the water bottles can be present as a justified due to the spending habits of the tourist and participation in the social goods by the customers (Gebauer, Saul and Haldimann, 2017).
Channels
Franchise
Franchise is the marketing concept which is adopted by the company for the expansion of business. Franchisee is the best platform for the company to reach out to the maximum customers. Khmer adopt such strategy and target maximum customers (Hoy, Stanworth, and Purdy, 2017).
Outlets
The company open their own outlet for water bottles at the place where number of tourist are high and near hotels to aware about their product to the maximum customers. It will help to gain the faith of customers and contribute towards social activity.
Home delivery Service
The company also provide home delivery service to their customers to target affluent Cambodian customers at maximum level. The home service will prevent from using more plastic bottles by the customers.
Physical Retailers
The existing retailers play a vital role in the business world. The main aim of the retailers is to earn maximum profit which seeks them to sell more products in the market. Therefore, retailers are the best platform for the company to connect with the maximum customers. The retailers near the hotels and hotspots are the main target of the company (Brei and Tadajewski, 2015).
Direct Website
Khmer water bottles will also create their own website in the social media to cover maximum consumers at the limited time. It gives the opportunity to the company to aware maximum customers about the environment explosion and deliver recycle bottles to the maximum customers in limited time period.
Media
There are other social media, through which the company promote their product such as Facebook, Instagram, and online advertisement and so on (Tuten and Solomon, 2017). The NGO’s and volunteers are the effective platform to promote their product at greater level by targeting number of customers.
Refilling centres
The water of Cambodia is quit polluted therefore; the company has set up refilling centres at the hotspots. It helps to deliver pure water to the Cambodian individuals. The refilling centres not only provide pure water but also help in reducing the maximum use of plastic bottles by giving an option to the customers to refill their bottle.
The Main Factory
The main factory is the key resource to produce water bottles which will cater to the customers. The local PET manufactures will be engaged and also request to provide 100% recycled PET bottles, as well as on-going buy back of the recycled PET bottles
Employees
The employees are the part of key ingredient in the success of the company. Therefore, employees are the key resources of the company which will recruit to prepare the product for the customers efficiently and effectively.
Rain Water Harvesting device
The device of rain water harvesting will help the company to store the water from rain and cater that water to the customers after the process of water filtering. The rain water consider as the pure water which only need to filter (Musayev, Burgess and Mellor, 2018).
Better-performing Material
The material of high quality will use to produce water bottle by the company to cater best quality product to the customers.
Cost Structure
Perpetual inventory system
Perpetual inventory is the system of inventory where the information on quantity of stock and availability is updated on the continuous basis which will be adopted by the company to make the system easy (Jones and Eaton, 2018).
Costs of Bottle
The cost of the bottle will be determined on the basis of material purchase, the production of goods and cost on distribution of product. The company also provide the facility of bailing point where the collector will resell their prepared empty bottles back to Khmer Water for US$0.10 per bottle for branded bottles and US$0.01 per bottle for other PET type bottles
Costs of Foundation
The huge amount is required for the foundation of the company. The company need to take in lease the community building which required the amount of $1 million and also require funds for start-up projects.
Cost of Marketing
The marketing is an effective tool to launch new product in the market. The marketing can be done through various ways such as direct selling, advertisement – online and offline which require funds. The budget of marketing cost is explained in below table:
Marketing Budget of Khmer (In million Dollars)
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Particulars |
1st |
2nd |
|
Traditional advertisement |
7000 |
7000 |
|
Direct marketing |
19000 |
18000 |
|
Social Media marketing |
5200 |
6500 |
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Total |
31,200 |
31,500 |
Sale of bottle
The main source of revenue for the company will be from the sale of bottle. It is estimated that 95% of the revenue will be earn from the sale of bottles which is the main stream for the company.
Supporting Projects
Other than selling the product, the company will also participate in supporting projects which can be the other source of revenue for the company.
Raising Awareness
Spreading of awareness is one of the main objectives of the company. Through sponsorships the company can earn income which may help the company to raise their assets.
Donations
Donation is the secondary source of revenue for the company. By partnering with the NGO’s the company can receive amount in the form of donation because the motive of the company is to serve healthy life to other and preventing environment from plastic pollution
Company has to survive the Breakeven Point of maximum period of almost six month
It is the objective of the company to capture at least 1% market share of bottled water in the Cambodia for that the company need to survive at the point of breakeven point between the periods of six month.
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Profit and Loss Statement |
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Month |
Apr 18 |
Apr 19 |
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Income |
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|
Sales |
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Sale of bottles |
$ 51,000.00 |
$ 63,750.00 |
|
|
Income Received (e.g. Commission earned, frachise fees etc.) |
$ 550.00 |
$ 15,500.00 |
|
|
Etc. |
$ 520.00 |
$ 400.00 |
|
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Total Sales |
$ 52,070.00 |
$ 79,650.00 |
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Less Discounts/Commissions |
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Sales Discount |
$ 2,550.00 |
$ 3,187.50 |
|
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Sales Commissions paid |
$ 1,275.00 |
$ 1,593.75 |
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Total Discounts/ Commissions |
$ 3,825.00 |
$ 4,781.25 |
|
|
Total Net Income |
$ 48,245.00 |
$ 74,868.75 |
|
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Cost of Sales |
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|
Opening Stock |
$ – |
$ 2,100.00 |
|
|
Inventory Purchased |
$ 21,000.00 |
$ 26,250.00 |
|
|
$ 21,000.00 |
$ 28,350.00 |
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|
Less Closing Stock |
$ 2,100.00 |
$ 1,850.00 |
|
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Total Cost of Sales |
$ 18,900.00 |
$ 26,500.00 |
|
|
Gross Profit |
$ 29,345.00 |
$ 48,368.75 |
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Expenses |
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General & Administrative |
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|
Charges of Bank |
$ 550.00 |
$ 530.00 |
|
|
Commission of credit card |
$ 1,100.00 |
$ 1,200.00 |
|
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Consultant fees |
$ 1,400.00 |
$ 1,550.00 |
|
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Office equipments |
$ 750.00 |
$ 850.00 |
|
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Business insurance |
$ 1,000.00 |
$ 850.00 |
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Etc. |
$ 820.00 |
$ 830.00 |
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Total General & Administrative |
$ 5,620.00 |
$ 5,810.00 |
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Marketing & Promotional |
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Advertisment |
$ 1,100.00 |
$ 1,210.00 |
|
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General Promotion |
$ 1,400.00 |
$ 1,540.00 |
|
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Other Promotion |
$ 700.00 |
$ 770.00 |
|
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Etc. |
$ 650.00 |
$ 715.00 |
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Total Marketing & Promotional |
$ 3,850.00 |
$ 4,235.00 |
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|
Operating Expenses |
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Newspapers & magazines |
$ 2,550.00 |
$ 2,550.00 |
|
|
Parking/Taxis/Tolls |
$ 1,100.00 |
$ 1,100.00 |
|
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Cleaning Machines |
$ 700.00 |
$ 700.00 |
|
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Cleaning & cleaning products |
$ 775.00 |
$ 775.00 |
|
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Sundry supplies |
$ 400.00 |
$ 400.00 |
|
|
Equipment hire |
$ 280.00 |
$ 280.00 |
|
|
Etc. |
$ – |
$ – |
|
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Total Operating Expenses |
$ 5,805.00 |
$ 5,805.00 |
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Motor Vehicle Expenses |
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Fuel |
$ 400.00 |
$ 401.00 |
|
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Vehicle service costs |
$ 608.00 |
$ 609.52 |
|
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Tyres & other replacement costs |
$ 250.00 |
$ 250.00 |
|
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Insurance |
$ 200.00 |
$ 200.00 |
|
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Registrations |
$ 1,000.00 |
$ 1,000.00 |
|
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Total Motor Vehicle Expenses |
$ 2,458.00 |
$ 2,460.52 |
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Website Expenses |
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Registration of domain name |
$ 2,200.00 |
$ 2,200.00 |
|
|
Hosting expenses |
$ 200.00 |
$ 200.00 |
|
|
etc |
$ – |
$ – |
|
|
Total Website Expenses |
$ 2,400.00 |
$ 2,400.00 |
|
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Employment Expenses |
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|
Permanent |
$ – |
$ – |
|
|
Wages and Salaries |
$ 1,100.00 |
$ 1,375.00 |
|
|
PAYE |
$ 1,200.00 |
$ 1,500.00 |
|
|
Superannuation |
$ 300.00 |
$ 375.00 |
|
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Other – Employee Benefits |
$ 300.00 |
$ 375.00 |
|
|
Recruitment costs |
$ 250.00 |
$ 255.00 |
|
|
Total Perm. Employment Expenses |
$ 3,150.00 |
$ 3,880.00 |
|
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Casual |
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Salaries/Wages |
$ 5,500.00 |
$ 5,500.00 |
|
|
Recruitment costs |
$ 4,000.00 |
$ 4,000.00 |
|
|
Total Casual Employment Expenses |
$ 9,500.00 |
$ 9,500.00 |
|
|
Insurance of Workcover |
$ – |
$ – |
|
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Total Employment Expenses |
$ 12,650.00 |
$ 13,380.00 |
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Occupancy Costs |
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Electricity |
$ 200.00 |
$ 250.00 |
|
|
Telephones |
$ 100.00 |
$ 100.00 |
|
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Property Insurance |
$ 20.00 |
$ 20.00 |
|
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Rates |
$ 15.00 |
$ 15.00 |
|
|
Rent |
$ 180.00 |
$ 180.00 |
|
|
Maintenance and Repair |
$ 62.00 |
$ 62.00 |
|
|
Removal of Waste |
$ 30.00 |
$ 30.00 |
|
|
Water |
$ 22.00 |
$ 22.00 |
|
|
Etc. |
$ – |
$ – |
|
|
Total Occupancy Costs |
$ 629.00 |
$ 679.00 |
|
|
Other Expenses |
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|
Machineries |
$ 6,000.00 |
$ 6,000.00 |
|
|
Vehicles |
$ 250.00 |
$ 250.00 |
|
|
Equipment |
$ 6,000.00 |
$ 6,000.00 |
|
|
Total Other Expenses |
$ 12,250.00 |
$ 12,250.00 |
|
|
Total Expenses |
$ 28,554.00 |
$ 29,909.00 |
|
|
Net Profit / (Loss) |
$ 791.00 |
$ 18,459.75 |
|
|
Total Year to Date Net Profit / (Loss) |
$ 791.00 |
$ 19,250.75 |
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Summary Profit and Loss A/C
|
Profit & Loss Statement |
|
|
|
|
Month |
Apr 18 |
Apr 19 |
|
|
Income |
|||
|
Total Sales |
52,070 |
79,650 |
|
|
Less Total Disc/Comm |
3,825 |
4,781 |
|
|
Total Net Income |
48,245 |
74,869 |
|
|
Less Total Cost of Gooods Sold |
18,900 |
26,500 |
|
|
Gross Profit |
29,345 |
48,369 |
|
|
Expenses |
|||
|
Administrative & General |
5,620 |
5,810 |
|
|
Promotional & Marketing |
3,850 |
4,235 |
|
|
Operating Expenses |
5,805 |
5,805 |
|
|
Expenses Of Motor Vehicle |
2,458 |
2,461 |
|
|
Website Expenses |
2,400 |
2,400 |
|
|
Total Employment Expenses |
12,650 |
13,380 |
|
|
Occupancy Costs |
629 |
679 |
|
|
Other Expenses |
12,250 |
12,250 |
|
|
Total Expenses |
28,554 |
29,909 |
|
|
Monthly Net Profit / (Loss) |
|
791 |
18,460 |
|
Total Year to Date Net Profit / (Loss) |
791 |
19,251 |
|
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Profit and Loss Ratios |
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|
Gross Margin |
0.60825 |
0.646047 |
|
|
Net Margin |
0.016395 |
0.246561 |
|
|
Mark Up |
1.552646 |
1.825236 |
|
|
Break Even |
46944.55 |
46295.38 |
Note: The whole profit will be reinvested in the enterprise for the welfare of the society
|
Rent Deposit |
$ 3,000.00 |
|
Furniture & Fixtures |
$ 1,700.00 |
|
Equipment |
$ 1,200.00 |
|
Build out/ Renovations |
$ 900.00 |
|
Decorating, Painting and Remodelling |
$ 850.00 |
|
Installation of Fixtures & Equipment |
$ 500.00 |
|
Starting Inventory |
$ 2,000.00 |
|
Legal and Other Professional Fees |
$ 1,100.00 |
|
License and Permits |
$ 500.00 |
|
Advertising and Promotion |
$ 1,100.00 |
|
Consulting |
$ 500.00 |
|
Payment of Deliver Truck |
$ 6,000.00 |
|
Supplies of Office and warehouse |
$ 1,400.00 |
|
Bank Loan |
$ 20,000.00 |
|
Land Purchased |
$ 30,000.00 |
|
Machines Purchased |
$ 4,000.00 |
|
$ 74,750 |
|
|
Conclusion From the above, it can be concluded that social business plays a prominent role in the business world. The environment has been greatly affected due to the excess use of plastic at the global level. It causes global warming in the environment. Cambodia is suffering from such issues. The economy of the country is quit terrible as the ratio of educated individuals in Cambodia is quite low. It increases the issue of unemployment in the country. Even though drinking water for the individuals is also polluted which not only affected the environment but also the heath of the individuals are affected at a greater level. Therefore, some associates have decided to supply pure water with recyclable bottles. The company has situated with the name of Khmer Water Bottles. The main aim of the company is to reduce environmental explosion by using recyclable product and deliver pure water to the individual. The main targeted audience of the company will be tourist, Cambodian individuals, and other members. The company has connected with various other agencies to promote their product in the market. It is recommended that like Khmer, other companies should also take initiative towards the protection of environment. It is the responsibility of every company and individual to deliver quality product to the customers without affecting the environment. |
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