“Esho Driving Shikhi” offers a wide range of driver services. It is ultimately the goal of the company to be a one-stop facility for all driver needs, including registration, licensing, etc. But at this time Esho Driving Shikhi mainly offers private and commercial driver education. The newly formed business is currently located in Mirpur. The mission of this driving school is to provide high quality, convenient and comprehensive driver education courses at the lowest cost. The key to low-cost leadership in this field is through special relationships with suppliers and buyers. It is the goal of Esho Driving Shikhi to have graduates of its programs with the safest driving records of any other competitor. When the company was founded, the owners realized that there was a great untapped opportunity in this industry. No company was providing what the customers truly demanded, high quality driver education, which ultimately leads to poorly trained drivers who drives recklessly causing accidents. The trainees are given practical classes as well as theory classes. Theory classes are provided through projectors in digital multimedia classrooms. In Theory Class they teach about Traffic Signs, Road Signs, Traffic Laws, and Vehicle Engine Mechanical and Maintenance. They will hire trained and certified instructors who provide all the teaching services. In addition, the company has a fleet of ten cars (both manual and automatic transmission) and five computer simulators that are used to train clients. Each of these pieces of equipment are maintained regularly. Course Price (BDT) Private car full course Auto + Manual 7000-9000 Private car Short course Auto 4500-6000

“Esho Driving Shikhi” has following targets in upcoming months General targets:  Keeping the marketing cost below 10% of sales.  Introduce facilities such as helping drivers to obtain license provided by BRTA from the 4th month after starting the business.  Winning the competition with the local community based local competitors.  Geographical expansion. Target (Membership) 1 st Quarter 2 nd Quarter Full course 200 300 Short Course 350 500

1.

Make a list of fixed costs and variable costs for the start up in the case. Make a pro forma Income statement for next two quarters (Quarter 1 & 2) by forecasting sales, costs to achieve the target profit. You must do the following-
- Make assumption sheet [your assumption sheet must be consistent with the business model in Q.2]
- Use BEPP to forecast sales