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  • Writer's pictureHarsh

LITTEROMATIC - BUSINESS PLAN

Background and Summary


Litter management has become a major challenge in today's society. It is something for which numerous solutions have been applied but none have worked effectively, mainly because they failed to secure consumer's engagement or interest.

Indiscriminate littering has led to deterioration of environment thus contributing to increased predisposition to diseases, contamination of natural resources, environmental pollution, etc. Litteromatic takes into consideration all of these challenges and thus manages to be fully aligned with government’s social and environmental welfare mission. Litteromatic is a smart bin which will benefit the users when they will throw litter in dustbins. To make it more efficient and convenient, some devices would be integrated with the model.

Those devices are as follows:-

1) RFID card Reader

2) Photoelectric counter

3) Litteromatic Card

The methodology is that whenever user will throw an item in Litteromatic, it would pass through beam of light rays which would make the photoelectric counter count the number of items entering the bin and credit the points accordingly.

These points would be credited to the user’s Litteromatic card that can be further claimed by using the RFID card reader. In addition, the points can be redeemed at all those brands who would have collaborated with Litteromatic. All the devices mentioned above are already in use so it would not be difficult to make this model to function. Moreover, this model is using photoelectric counter so it would reduce the amount of electricity used for the model. An app would also be created which will store the users' basic credentials and information about their Litteromatic card. It would also show the brands which are in collaboration with Litteromatic where users would be able to keep a track of their points.

Litteromatic can be installed wherever there is a need for litter management like cafeterias of schools, universities and offices, Bus stops, street food vendors market, beaches and basically all public places. This machine is basically giving people free money while giving them an opportunity to do something better for their surroundings and environment.

Functionality of app






I have shown a detailed description of my computing device or Litteromatic app through the flow chart below.

SOURCE OF FINANCING


1) Venture capitalists

2) Various entrepreneur/ startup schemes launched under the government of India.

3) Bank financing


GEOGRAPHY/ TARGET MARKET

1) INITIALLY - HIGH DENSITY NATIONAL CAPITAL REGION


These regions face a severe problem of littering. Despite coming under the national capital region, the roads , parks, etc are always littered, including the contamination of our holy river Yamuna. Besides, a hub of recycling and higher middle class population would be a very attractive business preposition for Litteromatic.


2) MID TERM PLAN( 1 TO 3 YEARS) - MAJOR CITIES OF INDIA



3) LONGTERM PLAN( 3 TO 6 YEARS)


Litteromatic can later be introduced to other growing economies in southeast Asia, Africa and Latin America as they face similar problem.


BUSINESS STAKEHOLDERS

1) Garbage collection agencies


2) Garbage Recycling Plants


3) Eateries, Restaurants, etc.


4) Consumers


5) Centre/state government


Business Process



1) Tie up with garbage collection agencies for picking up garbage from litteromatic bins placed across various locations in the identified markets in the National capital region.


2) We will also engage with willing recycling plants to engage their own garbage collection agencies to pick garbage from various litteromatic bins.


3) Tie up with public outlets like stores, shopping complexes and online e- commerce businesses.


Agree on the commercial aspect of the business transaction on case to case basis so that customers redeem their points against the purchases they make at their business outlets.

With the increase of customer influx , the revenue sharing formula can be revisited downwards with the introduction of option of royalty payments.


PROJECTED REVENUE

Total number of litteromatic bins = 1,000

Maximum waste collecting capacity per bin - 50 kgs

Number of garbage collection per day = 2 times

Total weight of waste collection per day = 100,000kgs ( 50,000 kgs x 2 times)

Rate per kg = US$ 0.014

Total anticipated revenue per day = US$ 1,400

Total anticipated revenue per month= US$ 42,000

BASIC PROJECT COST

1) Capital Expenditure (CAPEX)


Litteromatic bin - US$ 70 to US$ 75 each

Total initial cost for 1,000 units - US$ 75,000

Litteromatic app setup(one time) - US$ 1,500

10,000 Litteromatic card at the rate of US$ .50 per card - US$ 5,000


TOTAL - US $ 81,500


2) Operational Expenditure (OPEX) ( per month)


Business expense ( sharing of revenue) - US$ 10,500 (25% of total monthly revenue)

Transportation, travel , accommodation - US$ 800

Office Rental - US$150

Manpower cost

A. Office/ field assistants ( 10 people) - US$ 1,200

B. Marketing officers (4 people) - US$ 1,000

Electricity , water , sundry expenses, etc - US$ 250


TOTAL - US$ 13,900



BUSINESS POTENTIAL

Based on the market survey, the per capita waste generation in India is 0.57kg per day i.e an astounding 753 million kgs. Similarly, in Delhi National Capital Region ( initial identified market) generates waste disposal to the tune of 11 million kgs per day. As per initial market plan 1 percent of the total waste disposal per day has been considered for business model.

In other words, we are only targeting 1 percent of the market as per the initial plan.


On prima facie, the business offers immense potential for revenue growth with high profits before tax.


BUSINESS ASSUMPTIONS

1) It is assumed that the government of India policies regarding the waste disposal and litter management would remain unchanged including tax exemption for startups and other entrepreneurial startup schemes.

2) The business model is based on only 1 percent of the total waste generation in Delhi national capital region and it is expected that the revenues will grow with the increase of market size.

3) Exchange rate considered US $ 1 equal to INR 74.

4) The CAPEX and OPEX are estimate and the detailed cost working would be done post detailed feasibility report.

5) The financing and leasing charges have not been considered for CAPEX.

6) The revenue profile has been estimated based on preliminary market data.

7) It is assumed that the garbage collection agencies will take corrective action to ensure minimum uptake of 50kgs waste disposal per bin.

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