BCM2010 CONTEMPORARY MANAGEMENT & ENTREPRENEURSHIP

A BUSINESS PROPOSAL FOR

BICYCLE RENTING SERVICE

Trimester 1, 2012/2013

The Project:

Prepared by: Name Fiona Yap Tsui Lee Yew Ee Linn Tang Chia Leh Ngan Wei Yee ID 1081107787 1081108452 1081107769 1081108156

Business Proposal

Table of Content
Executive Summary Concept History and Background Concept History How did the business idea came about? Company Background - The people of Rent & Ride Mission Rent & Rides pledge to the MMU community The Rent & Ride Logo Goals and Objectives Project Background Description of Product and Service Renting Procedure Rules and Regulations Procedural Flowchart Organization, Management and Staffing Plan Project Team Organization Chart Supplier of Bicycle and Maintenance Labour Marketing Plan Market Analysis Business Life Cycle Proposed Location SWOT Analysis Future market Consumers and Demand Customer Profile Competitor Geographic Market 19 20-21 22 12 13 13-14 15-16 17-18 9-10 11 11 6 6 7 8 3 3 4 4 5 1-2

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Pricing Policy Renting procedures Marketing Strategy Facebook Page Redemption Card Financial Plan Balance Sheet Initial Start Up Estimated Statement of Cash Flows in Year 1 Monthly 12 Months of Accounting Ratio for Year 1 Break-Even Data Analysis Appendix

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23-25 26

27 28-29 30 31-32

Mr Norwahil Abu Business Unit, Ground Level, STC Building, Multimedia University, Persiaran Multimedia, 63100 Cyberjaya, Selangor Darul Ehsan. ________________________________________________________________________________ Rent & Ride, MMU Cyberjaya. Approval for Business Location Dear Mr Norwahil, We, owners of Rent & Ride, would like to seek your approval to rent us premise no.CFC K11 at the Central Food Court (CFC) Building for the purpose of running our business. Rent & Ride is a partnership company owned by four students of MMU. Rent & Ride is on a quest to promote a healthy lifestyle and to revive the interest and activity of cycling among students of MMU Cyberjaya. We plan to start a convenient bicycle renting service to provide another form of healthy recreational activity for MMU community, especially students. Rent & Ride is to accomplish the following goals:

1st August 2012

To bring back cycling as a trend among MMU students; To encourage MMU students, local and internationals alike, to explore the surroundings of Cyberjaya; To get MMU students to exercise more while having fun at the same time.

At Cyberjaya, other than studies, students in MMU Cyberjaya need to have some time for entertainment and recreational activities to let them get refreshed. We would like to encourage them to exercise as it is said that healthy body, healthy mind. The MMU community will gain benefits such as living a healthier lifestyle, gaining another form of socializing when using our service in group and also getting the chance to have fun while exercising without having to own a bicycle. The attached proposal will detail our strategic plan on how to accomplish these initiatives. Please review the attached proposal for more information about Rent & Ride.

We are eager to hear your comments and answer any questions you may have. You can reach us at (03) 168-1688. Thank you for your time and attention.

Sincerely, Fiona Yap, Ngan Wei Yee, Tang Chia Leh and Yew Ee Linn Owners of Rent & Ride, MMU Cyberjaya.

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Executive Summary
Cycling is normally seen as a mode of transportation and exercise. There are some cycling enthusiasts who bring cycling to a higher level where they commute solely with bicycle or they cycle in different environments. Cycling provides many benefits to cyclist and also the environment, such as it does not contribute to air or noise pollution and does not run on fuel. Cycling also reduces traffic congestion. Almost everyone cycles in their childhood but as we grow up, we tend to cycle less and hence, cycling gradually loses its popularity.

Rent & Ride is a partnership company owned by of Fiona Yap, Ngan Wei Yee, Tang Chia Leh and Yew Ee Linn that serves to promote a healthy lifestyle and to revive the interest and activity of cycling among students of MMU Cyberjaya. Fiona is primarily responsible for the management of the whole organization and aiding Wei Yee with the Financial projection. Wei Yee is handling Finance and Accounting. Chia Leh is also responsible for staffing plan, delegating the work among the owners and staffs. Ee Linn is in charge of liaison with the supplier which includes reviewing existing relationships on a regular basis and renegotiating terms when necessary. We provide convenient bicycle renting services for recreational purposes.

In Cyberjaya, we see a potential for the service because there are not many cars on the road and MMU itself has a very big compound, additionally, Cyberpark is nearby for students to rent our bicycles and ride to get themselves off studies a while. We believe that a healthy body leads to a healthy mind.

Rent & Ride is set up to accomplish the following goals:

To bring back cycling as a trend among MMU students;

To encourage MMU students, local and internationals alike, to explore the surroundings of Cyberjaya;

To get MMU students to exercise more while having fun at the same time.

Many students wish to ride bicycles here but they have to bear a burden and responsibility if they owned one; like parking, keeping and servicing their own bicycle. Renting from us would solve all these inconveniences. All that students need to do is to come to us and rent a
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bicycle for few hours for exercising or relaxing then return it back to us. The bicycles will undergo a monthly service from our bicycle and maintenance labour supplier. This business is mainly targeted to students in MMU who have the characteristic of outgoing, responsible, active in sports, health conscious, and etc. One of them method to promote our business is via Facabook page as most of the students in MMU spent ample time on Facebook. Therefore, promotional posters and updates are posted in the page in order to inform and attract more students or other MMU community to use our service. Other than that, the strategy that we use to boost customer loyalty is by giving out redemption card which allows customers to collect stamps and redeem their reward.

In order to provide the service to students, the company is to be set up with a total capital of RM20,000.00 which is contributed by each members equally. The capital will be used on acquiring necessary assets, equipment, furniture, utilities, and advertisement. By sixth month of the business, the company projected return of capital.

In the future, we will consider participating in special events such as convocation, orientation day, club activities, or society events to attract the event committee or the organizer to use our service at a special pricing. Furthermore, we will increase the number of bicycles and add in other varieties of bicycles such as BMX bicycles and Fixie Bike for customers to choose. In addition, we plan to organize events such as cycling treasure hunts or racing competitions to promote brand awareness, engage our loyal customers and attract more people to cycle as well as promoting ourselves in bicycle renting service.

Company Contact Information

Address : Rent & Ride CFC Central Food Court (CFC) Building MMU Cyberjaya Persiaran Multimedia 63000 Cyberjaya, Selangor. : (03) 8168-1688. : rentnride@gmail.com
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Telephone No. Email

Business Proposal

Concept History and Background

Concept History How did the business idea came about?
Rent & Ride is a business group of students from Faculty of Creative Multimedia, Multimedia University (MMU). The idea to start our bicycle renting business started around June 2012. To get out of the stress of classes and assignments, we often visit nearby parks to take a breather and let loose. One day, we discovered that Taman Botani, Putrajaya has bicycle renting services. We rented the bicycles and had a good time because we were reminded of the times we used to cycle as kids and how the past time of cycling is becoming less popular nowadays. At that moment of nostalgia, we were inspired to bring back the joy of cycling by renting bicycles in MMU, Cyberjaya. Since Cyberjaya has yet to have bicycle renting services, we decided to seize this opportunity to carry out this business.

Company Background - The people of Rent & Ride

Rent & Ride is a partnership company owned by of Fiona Yap, Ngan Wei Yee, Tang Chia Leh and Yew Ee Linn. The four of us met during our Foundation year back in 2008. We often spend time together be it for class assignments or just to hang out. We are a group of nostalgic and fun lovers who also share the same passion for reviving the love for cycling. After having the idea of renting bicycles, we formed Rent & Ride in 2012.

Figure 1: The founders of Rent & Ride

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Mission Rent & Rides pledge to the MMU community

As kids, everyone has fond memories of cycling. It may be a symbol of growing up when the training wheels are off; an activity to meet friends after school or a getaway to discover places unknown from the familiar walls of home. Therefore, we decided to commit ourselves to bring back this past time to MMU students so they can relive the good times they had when cycling as kids.

The Rent & Ride Logo

The Meaning of the logo:

The four circles behind the wheel represent the 4 founders of the business. The dark green on the bicycle represents the nature of being bold and adventurous. The light green represents freshness.

Both green colours show that cycling is environmental friendly. The orange colour represents youths, our target audience who are young and energetic. The bicycle is seen rising at an angle. This represents our goal to make this business soar in terms of the popularity of cycling and the profit of our business as well.

The font for the company is written in Sans Serif. Sans Serif fonts and lower cases gives a less formal appeal compared to Serif fonts. We chose this choice of font to show the fun and recreational nature of our business.

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Goals and Objectives

Objectives

To promote healthy lifestyle among students To provide a convenient bicycle renting service for students of MMU Cyberjaya To provide another form of healthy recreation for MMU students

Goals

To revive the interest and activity of cycling among MMU students To encourage MMU students, local and internationals alike, to explore the surroundings of Cyberjaya

To get MMU students to exercise more while having fun at the same time

Business Proposal

Project Background
Description of Product and Service
Rent & Ride rents out bicycles to students of MMU on an hourly basis for recreational purposes. A basic charge will be applied and the consequent renting hours will be added to become the total charge for renting. Students are required to read and fill in the consent form to rent a bicycle. They must also present their student ID for approval of the consent form. The charges for Weekdays and Weekends are as follows:

Basic charge + 1st hour charge + Rented hours = Total charge Charges Basic charge Consequent hours Weekdays RM4.00 RM2.00 Weekends RM6.00 RM2.00

Business hours Weekdays (Mon - Fri) Weekends (Sat - Sun) 4pm - 8pm 8am - 8pm

Renting Procedure

Figure 2: Renting procedure

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Rules and Regulations

1. Customers must read and fill in the Declaration and Indemnity Form to rent a bicycle. They must read through the rules and regulations in detail. Once it is signed and agreed, customers have the responsibility to follow the rules and regulations or face penalties/consequences if otherwise. 2. Penalty causes: a) Late return of bicycle - RM20 charge If the customer returns the bicycle after operating hours (Weekdays 8pm; Weekends 9pm) the customer will face a RM20 penalty charge. b) Damage to bicycle - RM10 to RM400 If any damage is done to the rented bicycle, the renting customer will face a penalty charge ranging from RM10 to RM400 depending on the level of damage. c) Lost of property - RM500 If the customer fails to return the rented bike, he/she must pay a charge of RM500 regardless of any reason/excuse explained or face legal action. 3. Customers are encouraged to check the conditions of their bicycles BEFORE riding it. If any defects or problems are found, please inform the staff for immediate attention. 4. Students are encouraged to switch ON the bicycle light when riding after sunset. This is to ensure their own safety when cycling on the road. 5. Renters agree to abide by all national rules of the road while using the bicycle(s). Renters are responsible for paying for any summons/penalty charges from the local road safety authorities or police authorities, including any costs resulting from impoundment and subsequent retrieval of the bicycle(s). 6. Customers are reminded that they will use the bicycles at their own risk. Rent & Ride shall not be responsible for personal injuries or property damage, loss or delay; nor shall Rent & Ride be responsible for any injuries, death, damage, loss or delay in any means of transportation or by reasons of any event beyond the actual control of Rent & Ride.

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Procedural Flowchart

Figure 3: Procedural flowchart

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Organization, Management and Staffing Plan

Project Team
Owner/Operation Qualification Experiences / Job Scope

- Diploma in Civil Engineering, 2006 Fiona Yap Tsui Lee

Hi, my name is Fiona. I have a great passion for animals. I love to travel, meet new people and learn different cultures. I love outdoor. I am a responsible person who puts in all the effort needed into any task assigned to me.

- Bachelor of Multimedia (Hons) Media Innovation

Prior to starting Rent & Ride, Fiona spent two years as Supervisor with Taska Penyayang Ceria. Fiona is primarily responsible for for the management of the whole organization and aiding Wei Yee with financial projection.

- London Chamber of Commerce and Industry (LCCI) course, 2003 Ngan Wei Yee
Im Wei Yee. Loves animals, crafts and art. Has a special fond of food experiment A believer on sustainable environment.

- Bachelor of Multimedia (Hons) Film and Animation

Wei Yee has a two-year experience in a management firm which provides services like accounting, company secretarial services, business advisory and taxation. She is handling the financial and accounting projection of Rent & Ride.

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Tang Chia Leh

Im Charlotte Tang. I like all things artistic and to have fun. Ive always liked cycling since I was young. I think that its the easiest and best way to release stress and Im glad that we can provide that way for MMU students

- Bachelor of Multimedia (Hons) Media Innovation

Chia Leh shares responsibilities of the management of Rent & Ride with Fiona. Chia Leh is also responsible for staffing plan, delegating the work among the owners and staffs.

- Bachelor of Multimedia (Hons) Media Innovation Yew Ee Linn

Hello there! My name is Erika Yew. I love to try new thing especially nice food and most of all I love to cycle!

Ee Linn is in charge of liaison with the supplier which includes reviewing existing relationships on a regular basis and renegotiating terms when necessary.

Fiona, Wei Yee, Chia Leh and Ee Linn will never take vacation at the same time. In the first few months, they will be managing Rent & Ride without any salary. After the third month of running the business, then they will be receiving a salary of RM5.50 per hour. They will hire staffs if there is a need in the future.

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Organization Chart

Company

Rent & Ride

Fiona Yap Tsui Lee Ngan Wei Yee Tang Chia Leh Yew Ee Linn

Owner/Operation

Tasks/Responsibilities

-management

-finance and account

-staffing plan

-liaison with supplier

Supplier of Bicycle and Maintenance Labour

Joo Wah and Co. is an agent supplying all kinds of bicycle; MTB, BMX, racing, and etc. based in Setapak, Kuala Lumpur. Joo Wah and Co. will be supplying the bicycles for Rent & Ride at a reasonable price. Joo Wah and Co. will also be providing labour for doing a monthly maintenance service on the bicycles that Rent & Ride owns.

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Marketing Plan
Market Analysis

Service Price Place Promotion

: Bicycle renting service : Refer to page 6 : Central Food Court (CFC) Building : Communication

Market Segmentation : Psychographic Segmentation Rend & Ride is targeted to students based on their lifestyle. These people are active in sports. They are health conscious, extrovert, nature loving, disciplined, and good in time management. Target Market : Differentiated Marketing Rent & Ride applied differentiated marketing to define the target market. In this case, we provide different sizes of bicycle which are 24 inches and 26 inches bike with different colour for students to choose. Students can make their choice based on their body size and which colour they prefer. Product Decision : Specialty Products Bicycle renting service is considered rare in Malaysia. Normally, people who do not know how to cycle will not be the main target for this business. Only people who knows how to cycle or people who wish to learn cycling are those who look for bicycle renting services. Due to this reason, advertising or promotions are needed to create awareness among people as well as attract more people to use our service.

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Business Life Cycle

Currently, there is no bicycle renting service in Cyberjaya. In this case, bicycle renting service is in the introduction stage. As we proposed, Rent & Ride will be the first bicycle renting service available for students in MMU. In fact, there is not bicycle or other services that related to bicycle renting available in Cyberjaya. This means that we can take this advantage to become pioneer in this service in Cyberjaya to gain more profit.

Proposed Location
CFC building is located in the centre of MMUs Fitness and sports hub where most of the sports facilities such as the gym, swimming pool, badminton and squash court are located. Therefore our business fits right into the location where we can gather all sports lovers, who are also our target audience, in one place. Furthermore, there is high concentration of people in that area which makes it a strategic place to gain foot traffic. Besides that, the architecture of the shop premise is suitable for our business. It has a wide corridor outside the building which allows us to park and display our bicycles. In addition, the shop is wide enough to place our management office and garage for storing our bicycles. Other than that, the CFC building is located in a convenient location where it is near the hostel and is geographically located in the middle of the two MMU entrances.

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Figure 4: Proposed location of Rent & Ride (Shop front)

Figure 5: Rent & Ride bicycle lot (Side of shop)

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SWOT Analysis
Strength

People wish to improve their quality of life by being have active and healthy. Cycling is a form of releasing stress. Cycling is a form of recreational entertainment where it can be enjoyed solo or in a group.

Cycling allows people to explore and enjoy the scenery of Cyberjaya. Cycling brings people closer to the environment. Students who cannot afford to own a bicycle may benefit from our services

Weakness

We have limited types of bicycles for rent Expensive price charge compared to competitors High risk when it comes to the safety of our bicycles because students may use them outside of our operating location

Absence of a backing sponsor like Taman Botani which is a subsidiary of Perbadanan Putrajaya. This gives us heavy burden to cover costs.

Limited number of staff and personnel Lack of experience

Opportunity

Health campaigns will indirectly encourage students to cycle as an effort to exercise.

Packages such as Putrajaya Bike Ride Cuti-cuti 1 Malaysia launched by the Ministry of Tourism will encourage people to cycle and explore their cities more. MMU concern about students health. Fewer cars in Cyberjaya compare to other cities.

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Threats

Unpredictable weather in Cyberjaya Lack of customers during off-seasons such as semester breaks where most students travel back to their hometowns and religious occasions such as the month of Ramadan where most people exercise the least.

Students are attracted to the virtual world where they prefer to spend more time on online games, their social media accounts and etc.

Students have their own vehicle such as motorcycle and car. Students are too busy for their work and studies during submission periods and examination weeks.

MMU does provide a fitness gym for students to exercise.

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Future market

For our future market, we will consider participating in special events such as convocation, orientation day, club activities, or society events to attract the event committee or the organizer to use our services. They may use our bicycles to perform transporting or props moving tasks. We will provide special pricing to the related bodies to encourage them to use our service.

Figure 6: Convocation

Figure 7: Club event

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Furthermore, we will increase the number of bicycles and add in other varieties of bicycles such as BMX bicycles and Fixie Bike for customers to choose. By adding more variety of bicycles in our shop, we will be able to attract and cater to a wider audience range such as MMU staffs and their families. In addition, we plan to organize events such as cycling treasure hunts or racing competitions to promote brand awareness, engage our loyal customers and attract more people to cycle as well as promoting ourselves in bicycle renting service.

Figure 8: Variation of bicycles 18

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Consumers and Demand

Customer Profile
Primary : MMU Students

Secondary : Staffs

Demographics Age Gender Education Occupation Allowance per month Race and Ethnicity Geographical Location : 18-28 : Male and Female : Degree, Master and Phd holders : Students in MMU : RM400- RM1000 : All races : Suburban

Psychographics Perceptions : Cycling is for leading a healthy life. Cycling is a kind of relaxation. Cycling is a way to enjoy the environment. Learning : Facebook page, website, online advertisements, friends, flyers, print advertisements. Attitude and Personality : Friendly, fun, loving, nature loving, outgoing, extrovert, responsible, good in time management, disciplined. Motivation and need Lifestyle : Having good time with friends. : Active in sports. Likes outdoor activities such as trekking and hiking. Health conscious. Likes exciting entertainment.

Based on the survey (Appendix 1), there are 68% of the participants in MMU answer they will use bicycle renting service. This shows that there is demand for bicycle renting service in Cyberjaya.
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Competitor

I) Taman Botani Putrajaya Capacity One Category Seater Rates Mon-Fri RM 2.00 / Hr Mon-Fri RM 4.00 / Hr Mon-Fri RM 1.00 /Hr Sat/Sun/Public Holidays RM 4.00 / Hr Sat/Sun/Public Holidays RM 8.00 / Hr Sat/Sun/Public Holidays RM 2.00 / Hr

Two

Seaters

Baby Carrier

Seat

One

Seater

Two

Seaters

Baby Carrier

Seat

Table 1: Bicycle renting charge in Taman Botani Putrajaya

Figure 9: Photos taken in Taman Botani Putrayaja

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II) Taman Wetland Putrajaya Category One Seater Rates Monday-Friday RM 2.00 / hr Monday-Friday RM 4.00 / hr Monday-Friday RM 1.00 / hr Sat./Sunday/Public Holidays RM 4.00 / hr Sat./Sunday/Public Holidays RM 8.00 / hr Sat./Sunday/Public Holidays RM 2.00 / hr

Two Seaters

Baby Sitter

One Seater

Two Seaters

Baby Sitter

Table 2: Bicycle renting charge in Taman Wetland Putrajaya

Both of these competitors are under Perbandaran Putrajaya. The bicycle renting service in the parks serve as one of the non-profit facilities for visitors and are managed by the government. It takes about 12 kilometres from MMU to Taman Botani Putrajaya and 14 kilometres to Taman Wetland Putrajaya.

Based on the price list above, both of the parks are offering at a lower rate compared to our business plan. Besides that, they provide different kind of bicycles including two seaters and baby sitter to their customers.

However, not every student in MMU owns a vehicle for them to travel to these destinations. It will be troublesome for MMU students if they want use the services provided by our competitors because they have to consider the time and money spent on traveling via public transport to these parks. Other than that, the marketing strategies of our competitors are not strong enough due to lack of promotion in the bicycle service.

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Geographic Market
The business is targeted to students in MMU Cyberjaya. Based on a study, majority of students in MMU live in Cyberjaya especially in MMU Hostel, Cyberia, Cresent, Domain, and Neo Cyber. However, our bicycle renting business which located in the campus will allow students approach to us easily.

Pricing Policy
Renting prices are set based on weekdays and weekends rates. We used our competitors pricing as reference to set our pricing. Customers have to pay a basic charge which include the first hour rate and then followed by consequent hour rate. The basic charges for weekends will be higher than weekdays because during the weekends, there will be more customers using our service. Besides that, the salary for staff will also be higher for weekends compared to weekdays. Penalty will be charged if the customer fails to return the bicycle on time.

Renting procedures
1. Students are required to fill in the Declaration and Indemnity Form at the counter. 2. Students will have to pay the basic charge first and surrender their MMU Student Identification Card. 3. Once the form is approved, the student is given a ticket stub to keep. The staff will record the bicycle rented and the time of renting. 4. Students return the bicycle when they are done. They must show their ticket stub at the counter. Total charges will be calculated and their MMU Student Identification Card will be returned.

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Marketing Strategy
Facebook Page
URL: https://www.facebook.com/rentride

Nowadays, university students are highly addicted to social networking especially Facebook. In this case, a Facebook page for Rend & Ride was created to reach the target audience. Students can communicate with us by sending message in Facebook which is free of charge. On the other hand, the admin can see how many people had liked our page. If the number of likes is lower than the expectation, we will come out with a strategy to gain peoples attention.

Figure 10: Facebook page for Rent & Ride

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Besides that, posts related to bicycle will be posted in the fan page in order to catch the attention from students as well as educate them regarding on the benefits of cycling.

Figure 11: Screenshot of Rent & Rides Facebook page

By having a Facebook Page, we are able to create photo albums to share some photos including promotional posters to the audience.

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Before the grand opening day, a promotion poster had uploaded on Facebook page to attract people to visit our shop on the first day of our business.

Figure 12: Grand opening promotion

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Redemption Card

Figure 13: Front and back view of the redemption card

There will be 200 redemption cards prepared for our customer to enjoy our promotion. The main purpose by having this strategy is to boost customer loyalty for our business. Each stamp will be stamp on the card once they use our service. Customers are allowed to share the redemption card. The cardholder can redeem one free ride if he successfully collected 10 stamps. In addition, customers have to follow our terms and conditions in order to have this promotion.

Terms & Conditions

ONE stamp will be issued for ONE bicycle rented. After 10 stamps, the cardholder is entitled to ONE FREE bicycle rent regardless of renting hours.

Only Rent & Ride issued stamps are valid for redemption. Markings or writings are NOT valid replacements for stamps.

Rent & Ride reserves all right to change or terminate any of these conditions at any time at the discretion of the managements without prior notice.

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Financial Plan
RENT & RIDE Balance Sheet Initial Start-up

ASSETS Current Assets Cash Fixed Assets Bicycles Furniture Machinery & Equipment

LIABILITIES 2,549 Capital 20,000

10,000 333 2,300

EXPENSES Wages Maintenance Rental Electricity Telephone Licenses Stationary Insurance Advertising Utilities Miscellaneous 0 0 0 0 20 60 60 3,000 68 1,500 110

TOTAL

20,000

20,000

*Note: a) Utilities comprises of deposits of telephone and two months rental of RM 600 per month. b) Miscellaneous consist of stamping duty and installation of telephone line.

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Estimated Statement of Cash Flows in Year 1 - Monthly

Pre-startup CAPITAL CASH ON HAND (Beginning of the month) CASH SALES Total Cash Assets Acquired EXPENSES Wages Maintenance Rental Electricity Telephone Licenses Stationary Insurance Advertising Utilities Miscellanuous Total Expenses NET INCREASE (DECREASE) IN CASH 20,000 0 0 20,000 12,633 0 0 0 0 20 60 60 3,000 68 1,500 110 4,818 Jan (RM) 0 2,549 4,540 7,089 0 0 0 600 90 25 0 0 0 0 0 0 715 Feb (RM) 0 6,374 4,540 10,914 0 0 0 600 90 25 0 0 0 0 0 0 715 Mar (RM) 0 10,199 4,540 14,739 0 0 0 600 90 25 0 60 0 0 0 0 775 Apr (RM) 0 13,964 4,540 18,504 0 990 300 600 90 25 0 0 0 0 0 0 2,005 May (RM) 0 16,499 4,540 21,039 0 990 300 600 90 25 0 0 0 0 0 0 2,005 Jun (RM) 0 19,034 4,540 23,574 0 990 300 600 90 25 0 60 0 0 0 0 2,065 Jul (RM) 0 21,509 4,540 26,049 0 990 300 600 90 25 0 0 0 0 0 0 2,005 Aug (RM) 0 24,044 4,540 28,584 0 990 300 600 90 25 0 0 0 0 0 0 2,005 Sept (RM) 0 26,579 4,540 31,119 0 990 300 600 90 25 0 60 0 0 0 0 2,065 Oct (RM) 0 29,054 4,540 33,594 0 990 300 600 90 25 0 0 0 0 0 0 2,005 Nov (RM) 0 31,589 4,540 36,129 0 990 300 600 90 25 0 0 0 0 0 0 2,005 Dec (RM) 0 34,124 4,540 38,664 0 990 300 600 90 25 0 60 0 0 0 0 2,065

2,549

6,374

10,199

13,964

16,499

19,034

21,509

24,044

26,579

29,054

31,589

34,124

36,599

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*Note: a) Cash sales is budgeted based on average sales in an optimum condition of a month of 30 days. Per bicycle Basic charge (1st hour) Consequent every hour Average of 2 hours per person Maximum of 4 hours per person Weekdays RM 6 x 22 days = RM 132 RM 132 x 15 bicycles = RM1,980 Weekdays (RM) 4 2 6 10 Weekend (RM) 6 2 8 12

Weekends RM 8 x 8 days = RM 65 RM 64 x 15 bicycles = RM960 (Morning session) RM 64 x 25 bicycles = RM1,600 (Evening session) TOTAL = RM 4,540

b) Maintenance: Fixed cost RM 50 per trip RM 50 per trip Non-fixed cost Cost is depending on parts of the bicycle.

Labour charge Traveling fee

Spare parts

Budgeted of two days allowance for maintenance and cost of spare parts increases as there will be more parts need to repair or change due to worn and tear circumstances.

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12 Months of Accounting Ratio for Year 1

Jan Net Asset Sales Gross Profit Total Expenses Net Profit Gross Profit Margin (%) Net Profit Margin (%) Return on Capital Employed (%) Return on Investment (%) 12,633 4,540 4,540 715 3,825 Feb 12,633 4,540 4,540 715 3,825 Mar 12,633 4,540 4,540 775 3,765 Apr 12,633 4,540 4,540 2,005 2,535 May 12,633 4,540 4,540 2,005 2,535 Jun 12,633 4,540 4,540 2,065 2,475 Jul 12,633 4,540 4,540 2,005 2,535 Aug 12,633 4,540 4,540 2,005 2,535 Sep 12,633 4,540 4,540 2,065 2,475 Oct 12,633 4,540 4,540 2,005 2,535 Nov 12,633 4,540 4,540 2,005 2,535 Dec 12,633 4,540 4,540 2,065 2,475

100 84.25

100 84.25

100 82.93

100 55.84

100 55.84

100 54.52

100 55.84

100 55.84

100 54.52

100 55.84

100 55.84

100 54.52

30.28

30.28

29.80

20.07

20.07

19.59

20.07

20.07

19.59

20.07

20.07

19.59

38.25

38.25

37.65

25.35

25.35

24.75

25.35

25.35

24.75

25.35

25.35

24.75

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Break-even Data Analysis Fixed Costs Asset Wages Maintenance Rental Electricity Telephone Licenses Stationary Insurance Advertising Utilities Miscellaneous Total Fixed Cost Variable Costs Maintenance Electricity Telephone Total Variable cost Variable Cost per unit at total of 25 units Average Sales per unit (Maximum of 4 hours per person per unit on weekdays and weekend) Contribution Margin per Bicycle Contribution Margin Ratio (Contribution Margin / Sales) Break Even Point in Sales (Total Fixed Expenses / Contribution Margin Ratio) MYR7,537.36 MYR 4.49 40.82%

MYR 1,052.75 MYR 742.50 MYR 150.00 MYR 600.00 MYR 90.00 MYR 21.67 MYR 5.00 MYR 25.00 MYR 250.00 MYR 5.67 MYR 125.00 MYR 9.17 MYR3,076.75

MYR 75.00 MYR 82.80 MYR 5.00 MYR 162.80 MYR 6.51 MYR 11.00

Break Even Point in Unit (Fixed Costs/ (selling price - variable costs)

686

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Business Proposal

**Note: Weekday Sales Less Variable expenses Contribution margin

MYR 10.00 MYR 6.51 100.00% 65.10% 34.90%

Weekend
MYR 12.00 MYR 6.51 100.00% 54.25% 45.75%

Total
MYR 22.00 MYR 13.02 MYR 8.98 100.00% 59.18% 40.82%

MYR 3.49

MYR 5.49

32

Appendix 1: Survey Result

1. Gender

Male Female

2. How much allowance do you get on a monthly basis?

14 12 10

8
6 4 2 0 Below RM400 RM401 RM600 RM601 RM800 RM801 RM1000 Above RM1000

3. How often do you exercise?

20 15 10 5 0 Almost 3-5 times a Sometimes everyday week Seldom Never

4. When do you usually exercise?

Morning Evening Night

5. Do you own a bicycle here in Cyberjaya?

Yes No

6. What is cycling to you?

I hate cycling I cycle to explore places I cycle for the thrill of speed I cycle for fun/ to exercise I dont know how to cycle 0 10 20 30 40

7. Do you think Cyberjaya is an enjoyable place for cycling?

Yes No

Yes: Cyberjaya has big road and fewer cars. It is safe for people to cycle There are separate paths to cycle in some areas I don't have my own transport & it would be nice to rent bicycles with friends just to eat and enjoy scenery around cyberjaya Need some cheap vapor fan to plug onto your bike to keep you cool when riding There are lots of places for us to cycling around. Fresher air (compare to KL) and there is a huge park for exercise. It is not so crowded and It is a small town so you can go almost everywhere with bicycle. There are a lot of things to see and discover, like the big path beside the lake for instance. Cyberjaya has ample space and turnings to cycle about. They have nice places to cycle like Neo Cyber and cycling in campus doesn't seem bad either.

No: The weather is hot. Putrajaya is a better place for it. Cyberjaya people drive like crazy. This place seems to be polluted. There nothing interesting. A lot of car accident happened in Cyberjaya. The places occupied with lot of office. Afraid that the bike will be stolen by others. The road broken everywhere caused by big vehicle.

8. If MMU had a bicycle renting service, would you use it?

Yes No

9. Are you interested in riding Razor Scooters?

Yes No

10. Would you usually wear protective gear when cycling?

Yes No

11. Do you think it is necessary to wear protective gear when cycling in Cyberjaya?

Yes No

12. What protective gear/ safety accessories would you rent if they were available?
I would not rent any
Reflective jacket Bicycle light Cycling gloves Elbow and knee pads Helmet 0 5 10 15 20 25

13. If MMU had a bicycle renting service, how much are you willing to spend on renting a bicycle? RM2 RM4 per hour RM3 RM5 per hour RM5 RM8 RM10 per day RM20 - RM30 per day RM50 per day RM15 per month RM15 per day RM2 per hour discounts after a certain amount of hours.

14. If you have any suggestions/opinions regarding bicycle riding/renting in Cyberjaya, do share them with us! Make it affordable. Can rent at Cyberpark. Make them affordable to students and it should be open 7 days a week. This is a awesome Idea, because most of the students don't have own transport, they can rent and use the cycle, which is environment friendly transport and cost-less. However if you fix more price for rental that can't affordable by the students, that would not be a great Idea. Bicycle I have rent before around RM2.00-Rm4.00 per hour. Mostly Rm2.00 per hour which is in Putrajaya, Taman Botani, Taman Wetland also in Masjid Putrajaya area mostly little bit expensive. Make it happen. Don't do this. If it is cheap enough, a lot of people will be willing to rent. Putrajaya Central has a bicycle renting service and they are doing well. Consider parking spaces for bicycles and maybe you might want to rent out bicycle locks too.

Appendix 2: Interview
Interviewee: Mr. Zakaria Bin Mat Location: Taman Botani Putrajaya Date: 30th July 2012

Photographer: Yew Ee Linn

Photos of interview session with Mr Zakaria and a tour to the bicycle bay

1. Tell us about the beginnings of your bicycle renting service in Taman Botani. Taman Botani is located in Precint 1 and it is one of the 12 themed gardens of Putrajaya. Taman Botani started out around 2002 and the bicycle renting service started around 2005.

2. How many bicycles do you own when renting service first started? The 1st batch started out with 50 bicycles and now the 2nd batch of bicycles have increased to 100 bicycles where 90 are in working condition.

3. How do you start your day and what are the procedures you take before closing the shop? We have staffs at the counter to collect the rental fees and issue receipts. Next we have bicycle maintenance staff who bring visitors to the bicycles, inspect the bicycles before they are used, checks the consent form and finally updates his checklist. When the bicycles are returned, the checklist is referred again to inspect the condition of the bicycle after being used. When its time to close shop, we have to move the bicycles to the garage for storing and carry out an inventory check. Finally, we do locking and checking. This entire process of ending our day takes about 2 hours.

4. When is the peak hour for renting bicycles? 5. About how many bicycles do you rent per day? (maximum and minimum) Depends on days. Sometimes on weekends, all bikes can be rented out. On weekdays, it could just be 10 bicycles being rented out. However it largely depends on seasons. Peak periods can be school holidays while non peak times can be rainy days and now, Bulan puasa.

6. With that many bicycles rented out, how do you manage the safety of the bicycles? 7. Have you ever had any theft cases? There are insurances for the cyclers but none for bicycles. If you are earning money by offering services, then you have responsibility to provide them with safety. As for bicycles, I think there are only insurance for motorized vehicles, but none for bicycles.

We have had cases where the cyclers ride our bicycles out of Taman Botani and simply left the bicycle in the middle of nowhere. We had to deploy our maintenance staff on motorcycles just to search for that bicycle. People take public property for granted which can be troublesome for us.

8. How do you manage damages done to the bicycles? (Penalty charges?) On average, 2 to 3 out of 20 bicycles rented out will be damaged every single day. We cant charge penalties onto customers because they will argue that it wasnt their fault and will never visit again.

9. How do you carry out your maintenance? We outsource repair services once every 3 months. This only includes labour fees. Bicycle spare parts are paid separately and they are usually costly. This makes things an expensive affair because we buy spare parts to be kept as stock because there is a need for repair almost everyday.

10. What are the biggest challenges your business has faced over the years? (Profit? Managing? Finding the right staffs with skills?) Renting bicycles can only be regarded as a social service. Its very difficult to make profit out of this business, unless you are sponsored by another company. Our daily profit cant even cover our spare parts costs. On average, we have 30,000 visitors per month where of them rent out the bicycles. However, we can only get around RM10,000 for our profit.

We can only regard bicycle renting as a social service to let the public be more healthy and enjoy the environment of Taman Botani when they cycle. However, we generate revenue from our side businesses like the seafood restaurant (Putrajaya Seafood Restaurant) and renting places inside the park for events like corporate functions and weddings.