REVENUES AND COSTS
REVENUES
Amara’s total projected revenues are calculated by assuming the market shares that the team could attain upon the launch of the project. Out of 1.7 million women that fit the customer segment in Scandinavia, assuming 5% of these women would be willing to use Amara as their preferred brand, it can be translated to 88,750 boxes per month. Based on another assumption, 40% of customers will purchase 10 pads pack, 20% will purchase 15 pads pack, and finally, 40% will purchase 20 pads pack, which will generate a total annual revenue of €7,018,350.
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By year 2, we expect to expand to new markets where Amara could have a good fit and by year 3, it is our goal to diversify our offerings to other products such as tampons and liners.
COSTS
Initial costs will include website development, brand design, and physical product design. The need to establish a legal contract with a production facility to be able to outsource the cost of producing biodegradable sanitary pads, which will represent a large part of Amara’s cost structure. Additional costs such as box printing, direct labor, and shipping fees will be incurred per box.
As for the fixed costs related to the business model, it includes administrative wages, warehouse and office rent, and marketing and advertisement fees, which include social media marketing campaigns along with partnerships with influencers. Another major cost is directly linked to the bigger mission, which is providing the rural Indian market with free sanitary pads. This will vary by month, depending on the quantity sold to a Scandinavian customer.
PROFIT
The expected gross profit for the year 2021 is €2,807,340 and the expected net profit for this same year would be €141,585.75.
PROJECTED INCOME STATEMENT
YEAR 2021
KPI'S
The customer Life-Time Value (LTV) will help determine the total revenue that one customer generates on average during the full period of subscription. Also, on the other hand, the Customer Acquisition Cost (CAC) can be estimated by dividing the costs spent on acquiring new customers by the number of customers acquired in the phase in which the money was spent. In the case of Amara, applying such Key Performance Indexes (KPI) will provide the start-up with extremely important insights on how much time it takes to recover the investment required every time the business acquires a new customer.