TISSUE

PAPER
FACTORY
MARKETING PLAN AND
PREFEASIBILITY

GROUP MEMBERS:
UNZILA ZAMEER (23801)
YASIR KHAN (23030)
KHURRAM HAIDER (22994)
SUPERVISOR ARSALAN MUGHAL (22316)
SIR FAROOQ SHAIKH MUHAMMAD UMAIR
(23115)
 ACKNOWLEDGMENT

We would like to extend our sincere gratitude to:

• Sir Farooq Shaikh for his relentless support and guidance
• Mr. Muntazir Haider (and TBC Team) for trusting us with the project
• Mr. Abdullah Zaki (Ex Chairman KCCI and CEO ZAKPAK)
• Mr. Uzair Rabbani (Sales and Marketing Manager Packages Ltd.)
• Mr. Uzair (SMEDA)
• Mr. Mubashir Diwan (GM Operations TUX)
• Mr. Ahsan (CEO Progressive International)
• All other individuals who extended their most sincere efforts and specially
took out time to assist us in completion of this project
CONTENTS

• Introduction • Production Overview

• Industry Analysis • Production Process
• Competitive Landscape • Financial Viability
• Consumer Insights • Project Cost Summary
• Opportunities and Threats • Financial Projections
• Issues and Gaps • Objectives and Strategies
• Conclusion
INTRODUCTION

• Tissue industry in Pakistan is growing rapidly

• Top players account for 83% of the market and include Packages
Limited’s Rose Petal (62%), Hankies (15%) and Bikiya Industries’
Tux (7%)
• Packages Limited is the only manufacturer that produces its own
pulp to produce tissue products
• All other manufacturers produce tissue products through
converting machines which convert mother reels into smaller
consumable tissue products
CATEGORIZATION

Product wise tissue papers are divided into:

 Facial tissues

 Toilet papers

 Party packs

 Napkins

 Wipes

Segment wise divided into:

1. Household use

2. Commercial use: HORECA, hospitals, schools/universities, offices, labs etc.

 TARGET SEGMENT
AND USAGE

Target segment Customer need Usage

 
Household Facial tissue Facial tissue is used mostly by women for cleanness
  purpose like makeup removal, face etc.
Household and Rolls tissue Rolls tissue is used for cleanness purpose, like in
commercial kitchen, toilet etc.
 
Household and Party pack Party packs are used for parties or in restaurants as it
commercial contains a greater number of tissues
Household Travel pack Student and travelers mostly use travel or pocket pack
  as it is convenient
INDUSTRY ANALYSIS
CURRENT MARKET SITUATION

 Global tissue paper consumption was more than 1 Million tons and
grew at a CAGR of 4.9% over the period of 2012-2018. It is
expected to grow at 6% over 2018-2022
 In Pakistan, the size of organized tissue paper market is around 280
million USD, and the unorganized sector is almost the same size
 Currently the market is somewhat uncertain due to dollar
fluctuations
 New tax reforms and strict observation of FBR have changed
market dynamics
Source: Paper & Tissue
Asia and Interview with
Packages Ltd.’s
Executives
CURRENT MARKET SITUATION

 Tissue paper market is growing at a rate of 12 to 15% each

year, this shows a lot of potential for new entrants
 Packages Ltd., being the market leader, has 62% market
share
 Hankies has a market share of 15%
 Bikiya Industries (Tux) has 7% market share

Source: Interviews with executives of

Tux, Packages Ltd, Progressive
International
MARKET SIZE ESTIMATION AND
FORECAST (VOLUME)
• The table presents Sales Volume (in 1,000 pieces) for each category

Category 2017 2018 2019 2020 2021

Facial 21,826 24,008 26,649 29,980 33,877

Toilet Roll 43,969 48,366 53,686 60,397 68,249

Party Pack 3,352 3,687 4093 4,605 5,204

Travel Pack 1,518 1,670 1854 2,086 2,357

Total 70,665 77,732 86,282 97,068 109,687

Source: Interviews with executives of

Tux, Packages Ltd, Progressive
International
MARKET SIZE ESTIMATION AND
FORECAST (VALUE)
• The table presents Sales Value (in Thousand Rs.) for each category

Category 2017 2018 2019 2020 2021

Facial 2,250,088 2,475,097 2,747,358 3,090,778 3,492,579

Toilet Roll 1,447,860 1,592,646 1,767,837 1,988,817 2,247,363

Party Pack 351,351 386,486 428,999 482,624 545,365

Travel Pack 152,971 168,268 186,777 210,124 237,440

Total 4,202,269 4,622,496 5,130,971 5,772,342 6,522,747

Source: Interviews with executives of

Tux, Packages Ltd, Progressive
International
CURRENT MARKET SITUATION

Rapid growth in Tissue industry Growth driven by:

makes it attractive to new entrants Population
Higher Disposable Incomes
Hygiene Awareness

Source: Paper & Tissue

Asia
COMPETITIVE LANDSCAPE
MARKET SHARES

Estimated Market Shares

1%
7% 5%

Cool & Cool

Fay 15%
Hankies
Moveeta
Others 1%
Papia and Familia 5%
Prime
Packages 3% 1%
Tux

62%

Source: Interviews with executives of

Tux, Packages Ltd, Progressive
International
MARKET SHARE IN
HOUSEHOLD CATEGORY

19%

Facial
Rolls
Party Pack/Napkin 57%
24%

Source: Interviews with executives of

Tux, Packages Ltd, Progressive
International
MARKET SHARE IN
COMMERCIAL SEGMENT

20%

Facial
44%
Rolls
Party Packs &
Napkins

36%

Source: Interviews with executives of

Tux, Packages Ltd, Progressive
International
OVERVIEW OF COMPETITORS

Competitor Operating Since USP Product Offering

Packages (Rose 1956 High quality Facial tissues, Toilet

Petal) products that are Rolls, Paper towels,
safe and reliable Pocket packs, Table
napkins, Party packs,
Hand towels, Paper
cups and plates
Packages (Tulip) 1956 Affordable and Facial tissues and
reliable tissues Rolls
KB Traders 1971 First to introduce Facial tissues,
(Moveeta) printed tissues in Handkerchief, Rolls,
Pakistan Napkins and Sanitary

Source: Respective websites of each

brand and interviews with their
executives
OVERVIEW OF COMPETITORS

Competitor Operating Since USP Product Offering

Converters 1990 Innovative health Facial tissues, Toilet

International (Fay) and hygiene Rolls, Kitchen
products towels, Table
napkins, Pocket
tissues, Party packs,
Hygiene hand towels
and Wet wipes
ABC International 2004 High quality Compact Tissue,
(Cool & Cool) products at Kitchen towels,
competitive prices Toilet rolls, Maxi
rolls & Travel packs
Progressive 2014 High quality tissues Facial tissues, Toilet
International (Prime) rolls, Hand towels
and Party packs

Source: Respective websites of each

brand and interviews with their
executives
OVERVIEW OF COMPETITORS

Competitor Operating Since USP Product Offering

Bikiya Industries 2015 Hygienic, Facial tissues, Rolls

(Tux) unbleached and and Napkins
certified Halal
Hayat Kimya (Papia 2018 Premium luxury Facial tissues and
and Familia) tissues without any Rolls
artificial ingredients
(Health and Hygiene N/A Skin-friendly tissues Pocket tissues, Facial
Products) Hankies that are tissues, Rolls,
antibacterial, Kitchen towels,
antifungal, odor Multi-purpose tissue
resistant and super rolls and Napkins
absorbent

Source: Respective websites of each

brand and interviews with their
executives
COMPETITION'S PRODUCTS AND
PRICING
Rose Petal Product Number of Plies Retail Price (Rs.)

Rose Petal Perfumed 100x2 130

Rose Petal Deluxe 200x2 220

Rose Petal Pop up Smart 70x2 60

Rose Petal Pop up 150x2 115

Rose Petal Multi Color 150x2 180

Rose Petal Ultra Soft 100x2 90

Rose Petal Luxury 100x2 135

Rose Petal Zoop 74x2 135

Rose Petal Maxob 2 (roll) 45

Hi-jeen Paper Towels 2 75

COMPETITION'S PRODUCTS AND
PRICING
TULIP
Product Number of Plies Retail Price (Rs.)

Tulip Regular 80x2 80

Tulip Popup 135x2 90

COOL & COOL

Product Number of Plies Retail Price (Rs.)

Emotions Cool & 220x2 240

Cool
Breeze Cool & 150x2 215
Cool
Cool & Cool Ultra 200x2 180
Soft
 COMPETITION'S PRODUCTS AND
PRICING
PRIME Name Number of Plies Retail Price (Rs.)

Prime Junior 50x2 50

Prime Galaxy 100x2 110

Prime Luxury 100x2 130

Prime Executive 150x2 180

Name Number of Plies Retail Price (Rs.)

HANKIES
Virsa by Hankies 100x2 190

Hankies Jumbo 2 (roll) 280

Hankies Kitchen Towel 2 (roll) 120

Hankies Decora 2 (roll) 240

COMPETITION'S PRODUCTS AND
PRICING
Product Number of Plies Retail Price (Rs.)
FAY
Fay Luxury 100x2 125

Fay FreshUp 150x2 105

Fay Crown Luxury 150x2 150

Fay Gardenia Perfumed 100x2 130

Product Number of Plies Retail Price (Rs.)

TUX
Tux Pop Up Mini 50x2 60

Shades Pop Up 150x2 135

Tux Grande 100x2 100

Royale Gold 200x2 230

COMPETITION'S PRODUCTS AND
PRICING

Brand Lowest Price Highest Price

Cool & Cool 180 240
Fay 105 150
Hankies 120 280
Prime 50 180
Rose Petal 60 220
Tulip 80 90
Tux 60 230
PRIMARY RESEARCH
RESEARCH OBJECTIVES

To understand the competitive landscape of tissue paper

industry

To understand the pain points of consumers

To design a feasibility plan for setting up a tissue paper

manufacturing factory
CONSUMER DEMOGRAPHICS

Age Education

18% 18% 19%

43%

38%
64%

18 - 21 21 - 30 Graduates Undergraduates
30 and above Postgraduates
CONSUMER DEMOGRAPHICS

Income Levels

11%
24%

17%

15%

33%
Less than Rs. 25,000 Rs. 25,000 - Rs. 45,000 Rs. 45,001 - Rs. 75,000
Rs. 75,001 - Rs. 100,000 Above Rs. 100,000
Which brand comes to your mind
when we talk about tissue papers?
3% 7%
4%

7%

Cool & Cool 8%

Fay
Others
Rose Petal
Tulip
Tux

70%
Which of the following brands of
tissue papers do you mostly use?
2% 5%

11%

5%

Cool & Cool

Fay
Others
Rose Petal
Tux

77%
What type of tissue papers do you
mostly purchase?
9%
1%

11%

Facial tissues
Kitchen use
Others
Toilet papers

79%
Which of the following is the most important
factor that you have in mind when purchasing
tissue papers?

9%

Brand image
29%
Price
Product quality
62%
 What is price that you expect to pay
for each of the following?

Type  Price (Rs.) Respondents Price (Rs.) Respondents Price (Rs.) Respondents

Facial 50 - 80 46% 100 14% 120 - 150 40%

Rolls 15 - 35 68% 80 16% 95 16%

Party Pack 100 44% 120  26%  150 30%

Travel Pack 15 40% 25  33%  35 27%

Where do you mostly purchase tissue
papers from?
12%

3%

Convenience stores
Others
Supermarkets

84%
 OPPORTUNITIES AND THREATS

Opportunities Threats
Huge population with high growth rate (2%) Economic Instability
Rising middle class with increasing disposable income
Fluctuation in pulp prices in the global market
levels (23% from 2001-2011)1
Industry is growing at 12% to 15% Threat from new entrants
Increased hygiene awareness among youth Intense competition
Strategic partnerships with suppliers/distributors Frequent currency fluctuations
Export to other developing markets
Strict regulations from government will provide a level
playing field for all cottage industry producers

1
Source: The Emerging Middle Class in
Pakistan: How it Consumes, Earns, and
Saves
ISSUES AND GAPS

Lack of high-quality tissues at affordable prices. Cheaper tissue brands are of

poor-quality while high-quality tissues have premium price tags
Tissue paper products have poor absorbency (10% respondents)
Apart from select few, tissue paper products are not soft enough and cause
skin irritation (15% respondents)
Volume wise per capita consumption of tissue products in Pakistan is very low
compared to other regional countries (70-100 grams per annum)
 The household penetration of tissue paper products in rural population is
very low
Most customers purchase from supermarkets (84% respondents)

Source: Online Article by Tariq Sherwani (Ex Director Sales and

Marketing, Misk Paper Mills) and Primary research (customer
responses)
PRODUCT REVIEW

Based on the conclusions drawn and the gaps identified, our

first product (Facial Tissue Paper) will have following features

High absorbency
High Softness and Thickness
2 plies
Economical Price

Source: Primary
research (customer
responses)
FEASIBILITY (OPERATIONS)
WHY FACIAL TISSUE FACTORY?

• For different types of tissues (Rolls, facial, etc.) there are

different machines
• This feasibility is for setting up a facial tissue manufacturing
factory
• This is because facial tissues currently have the highest
demand in the category
PLANT REQUIREMENTS
(OVERVIEW)
• The tissue factory will require at least 500 sq. yds of land
for production and storage
• Tissue converting machine, compressor/vacuum pump
• Raw material: Jumbo rolls and tissue boxes (bleach card
boxes)
• Labor force, factory staff as well as office staff
PRODUCTION
OVERVIEW
(MACHINERY)

Converter machine to
convert jumbo rolls into
facial tissues

Tissue converter
machine is imported
from China

Machine is
manufactured and
supplied by Dalian
Mach Limited
 PRODUCTION OVERVIEW
(MACHINERY)
Machine setup features

DOUBLE-LINE MANUAL PACKAGING CAN BE ADDED TO FULLY

CONVERTING MACHINE (INDUSTRY STANDARD) AUTOMATE THE PROCESS
PRODUCTION OVERVIEW
(MACHINERY)
Machine Specifications
Installed converting capacity 60m per minute of tissue
Power requirement 12kW (3-phase)
Max. diameter (jumbo roll) 1.2m
Max. width (jumbo roll) 2.8m
Max. weight (jumbo roll) 250kg
Max. diameter (inner core) 76.2mm
Machine weight 4.5 metric tons
Machine dimensions (L x W x 7.9m x 2.5m x 1.9m
H)
PRODUCTION OVERVIEW
(MACHINERY)

Operational Capacity
Operational speed 30m per minute per line
Jumbo roll diameter 800mm
Jumbo roll width 1200mm
Jumbo roll weight 250kg
Inner core diameter 76.2mm
PRODUCTION OVERVIEW
(MACHINERY)
Jumbo Roll Specifications

• Width: 1200mm
• Diameter: 800mm
• Weight: 250kg
• Inner Core: 76.2mm
 PRODUCTION PROCESS

PURCHASING RAW STORAGE/WAREHOU FEEDING JUMBO EMBOSSING CUTTING

MATERIAL SING ROLL

PACKAGING STORAGE FOR

DISTRIBUTION
 PRODUCTION PROCESS

Purchasing Raw Material

Main raw material Can be imported Importing can be Source from large
includes Jumbo or purchased complex, tedious local
Rolls locally and expensive manufacturers
 PRODUCTION PROCESS

Storage/Warehousing

REQUIRES COOL AND FACTORY LAND SPACE AS MANY AS 10

DRY CONDITIONS WILL BE SUFFICIENT JUMBO ROLLS CAN BE
STORED
 PRODUCTION PROCESS

Feeding Jumbo Rolls

• 2 Jumbo Rolls will be
installed on to the machine
•  Machine holder can be
lowered to allow for easy
installation
• Once installed, the holders
are lifted seamlessly
 PRODUCTION PROCESS

Embossing
• Pre-installed Embossing
roller for designs
• Different rollers for
different designs
• Design is carved onto the
sheet as it passes through
the roller
 PRODUCTION PROCESS

Cutting

SHEETS PROCEED TO BLADES CUT THE SHEETS PROCEED TO

THE BLADES AFTER SHEETS SMOOTHLY THE COLLECTION TRAY
EMBOSSING
 PRODUCTION PROCESS

Packaging

Standalone No packaging unit Manual packaging

converting machine (Industry Standard)
 PRODUCTION PROCESS

Storage and Distribution

FINISHED PRODUCT IS TRANSFERRED TO PICKED UP FOR

PACKED STORAGE AREA DISTRIBUTION
FACTORS TO CONSIDER FOR OPERATIONAL
CAPACITY

Limit operating speed to 30m/min to prolong

machine life and produce required number of
boxes

Lower speed to account for manual

packaging

Wastage factor (5%)

 PLANT OUTPUT
(CAPACITY)

Production
1 Facial tissue box (100 x 1gram tissues) Produced in 10 seconds
10 Facial tissue boxes Produced in 100 seconds
5,000 Facial tissue boxes (double-line) Produced in ~ 8 hours
Wastage factor 5%
4,750 boxes of facial tissues (double- Produced in ~ 8 hours
line)
Initial Production 1,500 Boxes per day
CRITICAL SUCCESS FACTORS

Low Price Strategy Innovation

Quality
Lower prices to penetrate Continuously add innovative
market and gain market Consistently superior product
share quality  features to differentiate
 GEOGRAPHICAL
AREA FOR Industrial area
INVESTMENT

Minimum power outages

Factors to consider for

Considerably low building rent
factory location

Proper roads for loading carriers

Selected area for investment is

Mehran Town (Korangi), Karachi
FINANCIAL MODELS

Financial model 1 Financial Model 2

100 % Equity 50% Equity
No debt 50% debt
Debt to equity ratio: 0 Debt to equity ratio: 1
No interest expenses Interest expenses

Debt will be in the form of bank loan. The tenure for the loan will be
5 years and the interest rate will be 16% (KIBOR @ 13.25)
 FINANCIAL MODELS

Particulars Financial Model 1 Financial Model 2

Equity Rs. 11,148,860 Rs. 5,574,430
Debt - Rs. 5,574,430
Total Rs. 11,148,860 Rs. 11,148,860
Tenure - 5 years
Interest rate - 16%
FINANCIAL VIABILITY

Project Economics and Financial Viability

Factors Details

Internal Rate of Return 41.5%

(IRR)

Net Present Value Rs. 39,168,218

(NPV)

Payback Period 4.57 years

FINANCIAL
VIABILITY NPV is positive

Project Economics and

Financial Viability of IRR is substantially
the project: higher than currently
assumed interest rate of
16%
The project is
financially viable,
because: The project will recover
the initial outlay of Rs.
11,148,860 in 4.57 years
REQUIRED INVESTMENT

Description Amount (in Rs.)

Capital Investment (Capex)  
Plant and Machinery 3,117,500
Customs Duty 556,200
Total Capital Investment 3,673,700
   
Working Capital Investment  
Upfront Rent 900,000
Raw Material 3,368,160
Operating Cash 3,207,000
Total Working Capital 7,475,160
Total Investment 11,148,860
PLANT AND MACHINERY
REQUIREMENT

• Converting machine
Dalian Mach Co. Ltd. Manufacturer and supplier of machine

• Generator
Hyundai Generator, Karachi. Rated output of 15 KVA

• Compressor/Vacuum Pump
For pneumatic pressure to control via PLC
 PLANT AND MACHINERY
REQUIREMENT

Particulars Units Unit Cost Total Cost

(Rs.) (Rs.)
Double-line Tissue Converting 1 2,317,500 2,317,500
Machine (DM)
Compressor 1 150,000 150,000
Generator (15 KVA) 1 650,000 650,000
Total 3   3,117,500
PLANT AND MACHINERY
REQUIREMENT
Actual Quotation from Dalian Mach (mach@[Link]):
• 2-Lane Automatic V-Fold Facial Tissue Paper Making Machine with
Wall-Board Structure (USD 11,780)
• Semi Automatic Facial Tissue Packing Machine (USD 5,480)
• Full Embossing Unit (USD 1,100)
*Cost included in calculation:
The price (USD 15,000; 1USD=154.5 PKR) was taken from the online
website of the manufacturer ([Link]) as advised by officials of [Link]

various tissue manufacturers.

Source:
[Link]
al_60275227563.html?spm=[Link].55.66104194TdnJ3a
IMPORT DUTY STRUCTURE FOR
CONVERTING MACHINE

HS Code (Pakistan Customs Tariff) 8441.8000

Customs Duty @ 5% Rs. 115,875
Additional Customs Duty @ 2% Rs. 46,350
Sales Tax @ 17% Rs. 393,975
Total Duties and Taxes Rs. 556,200
RAW MATERIAL
REQUIREMENT
• Mother reel
also known as jumbo roll, is the main component of the raw material. At
a time, two reels will be installed on the machine simultaneously. These
can either be imported or sourced locally from other large
manufacturers.

• Bleach card boxes

Bleach card boxes for packaging will be required. These are readily
available locally at wholesale rates.
MONTHLY RAW MATERIAL
REQUIREMENT

Raw Material Cost (Rs.) Units Total (Rs.)

Jumbo roll 75,000 15.2 rolls 1,140,000
Bleach card box 14 36,000 boxes 504,000
Total     1,644,000
 SPACE REQUIREMENT

Three options were most feasible to set up the factory:

• Orangi
• New Karachi
• Mehran Town (Korangi)
The table below highlights approximate rent that will need to
be paid monthly. The suggested area is Mehran Town
(Korangi)
Particulars Area Rent (per month)
Factory space 4500 sq. ft. (500 sq. Rs. 150,000
yd.)
Total   Rs. 150,000
HUMAN RESOURCE
REQUIREMENT
Description No. of employees Monthly salary per Total Monthly Salary
employee
Factory Supervisor 1 Rs. 80,000 Rs. 80,000

Machine Operator 2 Rs. 22,500 Rs. 45,000

Packing Staff 1 Rs. 20,000 Rs. 20,000

Marketing and 1 Rs. 70,000 Rs. 70,000

Sales Executive
Salesperson 2 Rs. 50,000 Rs. 100,000

Guard 1 Rs. 20,000 Rs. 20,000

Accountant 1 Rs. 30,000 Rs. 30,000

Office Boy 1 Rs. 20,000 Rs. 20,000

Total 10   Rs. 385,000

OTHER COSTS

• The advertising and promotion costs are set at 7% of total

revenues for the first year. This translates to an annual
advertising and promotion costs of Rs. 2,400,000 or Rs.
200,000 monthly, as shown below:

Costs Amount (Rs.)

Advertising and promotion 200,000
Fuel 26,000
Electricity 23,500
Total 249,500
PROJECT COST SUMMARY

Particulars Cost

Plant and Machinery Rs. 3,117,500

Customs Duty and Taxes Rs. 556,200
Prepaid Land Rent (6 months) Rs. 900,000
Raw Material (2 months) Rs. 3,368,160
Operating Cash (6 months) Rs. 3,207,000
Total Rs. 11,148,860
REVENUE GENERATION

Revenue Generation
• Various marketing strategies will be employed to drive sales
• The first month’s sales target will be 40,000 boxes
• With aggressive marketing, significantly higher amount of
boxes (57,000+) can be sold
• Greater the number of boxes sold, higher the profit
margins
 REVENUE GENERATION

Description Scenario 1 Scenario 2

Boxes sold per month 36,000 boxes 57,000 boxes
Total cost per box Rs. 65.25 Rs. 60.7
Selling price per box Rs. 68.5 Rs. 68.5
Boxes sold in first year 496,640 boxes 786,347 boxes
Revenue for first year Rs. 33,870,842 Rs. 53,628,833
Net income in first year Rs.
Rs.2,774,267 Rs.4,795,660
464,574 Rs. 6,663,689
 BREAK EVEN
ANALYSIS

Description With 36,000 boxes With 57,000 boxes

Total Fixed Cost Rs. 9,150,633 Rs. 9,750,633
Fixed Cost per unit Rs. 21.18 Rs. 14.25
Variable Cost Rs. 23,230,324 Rs. 36,434,847
Variable Cost per unit Rs. 46.95 Rs. 46.45
Total Cost per unit Rs. 65.25 Rs. 60.7
Break even in units 424,624 boxes 442,206 boxes
Break even in Rs. Rs. 29,086,699 Rs. 30,291,083

Microsoft Excel
Worksheet
 INCOME STATEMENT
Income Statement (Rs.) 2021 2022 2023 2024 2025
Sales Revenue 33,870,842 46,689,660 64,365,299 88,729,680 102,039,132

Less: Cost of goods sold 23,230,324 31,828,123 43,679,925 60,031,776 66,034,954

Gross Profit 10,640,517 14,861,537 20,685,374 28,697,904 36,004,178

Expenses
Rent 1,800,000 1,980,000 2,178,000 2,395,800 2,635,380
Salaries 4,620,000 5,682,000 6,850,200 8,135,220 9,548,742
Advertising and Promotion 2,400,000 2,880,000 3,456,000 4,147,200 4,561,920
Depreciation 330,633 330,633 330,633 330,633 330,633
Subtotal 9,150,633 10,872,633 12,814,833 15,008,853 17,076,675

Operating Income/EBIT 1,489,884 3,988,904 7,870,541 13,689,051 18,927,503

Less: Interest Expense 835,555 699,262 539,489 352,192 132,630
654,330 3,289,642 7,331,052 13,336,858 18,794,873

Earnings before taxes 654,330 3,289,642 7,331,052 13,336,858 18,794,873

Less: Income Tax 189,756 953,996 2,126,005 3,867,689 5,450,513

Net Income (Loss) 464,574 2,335,646 5,205,047 9,469,169 13,344,360

BALANCE SHEET
Balance Sheet (Rs.) 2020 2021 2022 2023 2024 2025
Assets
Current Assets
Cash 3,207,000 (827,026) 1,634,273 2,314,592 4,873,744 14,571,719
Accounts Receivable 3,779,668 6,051,370 9,688,438 15,511,501 17,838,226
Raw Material Inventory 3,368,160 3,536,568 3,713,396 3,899,066 4,094,020 4,298,721
Prepaid Rent 900,000 990,000 1,089,000 1,197,900 1,317,690 1,449,459
Total Current Assets 7,475,160 7,479,210 12,488,039 17,099,996 25,796,955 38,158,125

Fixed Assets
Plant and machinery 3,673,700 3,343,067 3,012,434 2,681,801 2,351,168 2,020,535
Total Fixed Assets 3,673,700 3,343,067 3,012,434 2,681,801 2,351,168 2,020,535

Total Assets 11,148,860 10,822,277 15,500,473 19,781,797 28,148,123 40,178,660

Liabilities and Equity

Current Liabilities
Accounts Payable 3,270,000 3,433,500 3,605,175 3,785,434
Total Current Liabilities 3,270,000 3,433,500 3,605,175 3,785,434

Long Term Liabilities

Debt 5,574,430 4,783,273 3,855,823 2,768,601 1,494,081
Total Long Term Liabilities 5,574,430 4,783,273 3,855,823 2,768,601 1,494,081

Equity
Paid-up Capital 5,574,430 5,574,430 5,574,430 5,574,430 5,574,430 5,574,430
Retained Earnings 464,574 2,800,220 8,005,267 17,474,436 30,818,796
Total Equity 5,574,430 6,039,004 8,374,650 13,579,697 23,048,866 36,393,226
Total Liabilities and Equity 11,148,860 10,822,277 15,500,473 19,781,797 28,148,123 40,178,660
 CASH FLOW STATEMENT
Cash Flow Statement (Rs.) 2020 2021 2022 2023 2024 2025
Cash flow from Operating Activities

Net Profit 464,574 2,335,646 5,205,047 9,469,169 13,344,360

Add: Depreciation expense 330,633 330,633 330,633 330,633 330,633
Accounts Receivable (3,779,668) (2,271,702) (3,637,068) (5,823,063) (2,326,725)
Inventories (3,368,160) (168,408) (176,828) (185,670) (194,953) (204,701)
Prepaid Building Rent (900,000) (90,000) (99,000) (108,900) (119,790) (131,769)
Accounts Payable 0 3,270,000 163,500 171,675 180,259
Net cash provided (used) by operating activities (4,268,160) (3,242,869) 3,388,748 1,767,542 3,833,671 11,192,057

Cash flow from Investing Activities

Capital Expenditure (3,673,700)

Net cash provided (used) by investing activities (3,673,700)

Cash Flow from Financing Activities

Principal Payments (Debt) (791,157) (927,450) (1,087,223) (1,274,519) (1,494,081)

Additions to Loan 5,574,430
Issuance of shares 5,574,430
Net cash provided by financing activities 11,148,860 (791,157) (927,450) (1,087,223) (1,274,519) (1,494,081)

Net Cash 3,207,000 (4,034,026) 2,461,298 680,320 2,559,152 9,697,975

RETURN ON
EQUITY AND ASSETS

Metric Value

Return on Investment (ROI) 4.16%

Return on Equity (ROE) 8.3%

REVENUE VS COGS
PROJECTION
Revenue Vs COGS (in Million Rs.)
Revenue COGS
120

102
100
89

80
64
60 66
47 60

4034 44

32
2023

0
2021 2022 2023 2024 2025
NET INCOME
PROJECTION
Net Income (in Million Rs.)
Net Income
16.00

14.00 13.34

12.00

10.00 9.47
Net Income

8.00

6.00 5.21

4.00
2.34
2.00
0.46
0.00
2021 2022 2023 2024 2025

NI (Rs.) 464,574 2,335,646 5,205,047 9,469,169 13,344,360

OBJECTIVES AND
STRATEGIES
MARKETING OBJECTIVES

Capture up to 0.15% of household market with in 5 years

To get 0.1% market share in the commercial facial tissue

paper market in Karachi in first 5 years of operations

Increase number of retailers from 1,000 to 1,500 in first

year
POSITIONING

The product will be positioned around its USPs:

• High Quality

• Innovation

• Economical Price
PRODUCT STRATEGY

Widespread availability of countless similar tissue brands will

mean that introducing a product without any strong value
proposition will result in another “me-too product”. To
counter this and stand out of the me-too segment, having
innovative features, such as using soft-packs for packaging
tissues to significantly cut costs, will be crucial.
PRICING STRATEGY

Introduce new product with “Penetrative Pricing” strategy by

initially offering lower price as compared to competitors. In
addition to regularly packaged products, we will offer bundles
of tissues through “Promotional Pricing”, where bundles are
sold at lower prices as compared to individual products (for
e.g. 2 roll pack and 6 roll pack).
PRODUCT PRICING

• Production cost per unit: Rs. 65.25

• Manufacturer’s selling price (Cost to distributor): Rs. 68.5
(5% margin)
• Distributor’s Price: Rs. 75.35 (10% margin)
• Retailer’s Price: Rs. 84.75 (~12.5% margin)
Supply Chain Price Margin

Manufacturer Rs. 68.5 5%

Distributor Rs. 75.35 10%

Retailer Rs. 84.75 12.5%

DISTRIBUTION STRATEGY

The product will be distributed to retailers (GT) and

wholesalers initially to build presence in the market. The
division will be such that 85% of the produced boxes will be
pushed to GT (mom and pop, convenience stores, tuc-shops,
mohalla shops, low-end LMTs etc.) and remaining 15% will be
distributed to wholesalers.
DISTRIBUTION STRATEGY

• Two models for distribution will be adopted to initially push

products to 1,000 retail shops around different areas of
Karachi
• 25 new shops will be added to the network every month (1
shop per day)
• This way, 300 new shops will have been added to the
network at year-end
DISTRIBUTION STRATEGY

Categories Category A Category B Category C Total

Type of stores Departmental Convenience Mom & Pop/ -
Stores Stores/Minimart Kiryana Stores
s
No. of shops 100 500 400 1,000
No. of cases 300 350 200 850
Cases per shop 3 0.7 0.5 -

• One case can accommodate 36 tissue boxes

DISTRIBUTION STRATEGY
(TWO MODEL APPROACH)
Retailers/GT
Manufacturer
Distributors (Rs. 84.75;
(Rs. 68.5; 5%
(10% margin) 12.5%
margin)
margin)

Wholesalers
Manufacturer Distributors
(Rs. 75; 9.5%
(Rs. 66.5) (3% margin)
margin)
MARKET COMMUNICATION
STRATEGY

Integrated Marketing Communication like advertising, public

relations, sales promotions and personal selling can ensure that a
tailored message is conveyed to the target segment which in turn
can lead to an increase in consumer awareness, retailer support and
brand loyalty. We intend not to spend a huge amount on promoting
products. Instead, we focus on delivering maximum product quality
at a price that sells itself.
 MARKETING PLAN

JANUARY FEBUARARY MARCH APRIL MAY JUNE JULY AUGUST SPETEMBER OCTOBER NOVEMEBR DECEMBER

Trade
promotions (2
free boxes per
carton)
Social media +
Instagram +
Website
Redeemable
coupons +
Facebook paid
promotion
Free travel
pack with
every box
Trade
promotions
Travel pack +
Redeemable
coupons
 MARKETING PLAN
MARKETING INITIATIVES DESCRIPTION MONTHS COST (Rs)
Trade promotions (2 free boxes per Trade promotion of 2 free boxes per January and February 1000*2*85 = Rs. 170,000~January
carton) carton (36 boxes in one carton) will be 1000*2*85 = Rs. 170,000~February
provided to retailers and wholesalers Remaining amount will be adjusted
as an incentive in number of boxes per carton
  negotiating with retailer

Social media boost+ Website development and social March and April Rs. 200,000 March
Instagram + Website+ media presence will be done, Social Rs. 200,000 April
influencer collaboration media boost will be used
 

Redeemable coupons + Facebook paid Redeemable coupon scratch card May and June Rs. 85 cost of 1 tissue box
promotion campaign will be launched for the  
month of May and June, coupon will 1,500*85 = Rs. 127,500 redeemable
be of free tissue box. Redeemable coupon +
coupon quantity = 1,500. Remaining Rs. 72,500 per month Facebook and
will be spent on Facebook paid brand Instagram paid promotion
promotion

Free travel pack with every box Free travel pack will be given as a gift July and August 36,000*5.50= Rs. 198,000 (for July
for marketing campaign and August)
Trade promotions (2 free boxes per Trade promotion of 2 free boxes per September and October 1000*2*85 = Rs.
carton) carton (36 boxes in one carton) will be 170,000~September
provided to retailers and wholesalers 1000*2*85 = Rs. 170,000~October
  Remaining amount will be adjusted
in number of boxes per carton
negotiating with retailer
Travel pack + Redeemable coupons Free travel pack with every box for November and December 36,000*5.50 = Rs. 198,000
November   November
Redeemable coupon Quantity=2,350 2,350*85 = Rs. 199,750 December
 
CONCLUSION

• Owing to greatest demand in the household segment,

(57%) facial tissue should be the first product

• The product should have high quality (soft and absorbent)

and carry an economical price tag

• Sacrifice profit margins initially to maximize sales

• Use the existing retail network to push the product

BIBLIOGRAPHY

• [Link]
• [Link]
0/1965042/0/en/Global-Tissue-Paper-Market-Analysis-and-
[Link]
• [Link]
88d28105ce91812da8ab5692/spectrum35-market-trends-
[Link]
• [Link]
perations-pakistan/
• [Link]
king-news/2018-02-14/hayat-kimya-establishes-pakistani-s
ubsidiary/
BIBLIOGRAPHY

• [Link]
nvest-150-million-pakistan/
• [Link]
• [Link]
_Emerging_Middle_Class_in_Pakistan_How_it_Consumes_
Earns_and_Saves
• [Link]
ecent_value_desc=true
THANK YOU
Any questions?