INTRODUCTION
To start a mobile shop business in India, it is important to understand that mobile currently exists in almost all households in the country. Mobile phones are used for receiving calls and outgoing calls, it is also used to capture messages, social media platforms, internet surfing, GPS and photographs, etc. Due to its regular use in everyday activities, people have become quite dependent on mobile phones. Such a situation provides a huge earning opportunity for the mobile shop business in India.
MARKET POTENTIAL
Currently, there are 1.18 billion mobile connections and 600 million smartphones, which is increasing by 25 million per quarter. However, smartphone penetration is still 47 per cent, considering the total number of mobile handset users, indicating a huge market for mobile phones taking into account the population of 1.3 billion in the country and increasing income in rural areas. It is forecasted that eight out of 10 mobile phones sold in India in the coming years (2021-2025) will be smartphones. In 2019, with a modest 7.0% year-over-year growth, India also became the second-largest smartphone market after China and it is expected that India will have 920 million unique mobile subscribers by 2025.
FUNDING SOURCE
Under the “Work 4 Progress” program of the Development Alternatives Group, such enterprises have been financed by Sankalp Swashakti Mahila Mandal (a Cluster Level Federation), SKS (Micro Finance Institution), and have also availed government support through the National Rural Livelihood Mission (NRLM), with an average loan size of INR 35,000.
BUSINESS ECONOMICS
FIXED CAPITAL (One Time Expenditure)
| EQUIPMENT & | AMOUNT (in INR) |
| Counter (2 units @ INR 400/unit) | 800 |
| Chair (@ INR 250/unit) | 250 |
| Rack (@ INR 1,500/unit) | 1,500 |
| Electric Fitting (@ INR 1,500/unit) | 1,500 |
| Glass Table (2 units @ INR 800/unit) | 1,600 |
| TOTAL | 5650 |
WORKING CAPITAL (recurring expenditure per month)
| STOCK & CONSUMABLES | AMOUNT (in INR) |
| Mobile Phones (15 units @ INR 5,000/unit) | 75,000 |
| Charger (50 units @ INR 100/unit) | 5000 |
| Headphone (50 units @ INR 100/unit) | 5000 |
| Mobile Cover (50 units @ INR 70/unit) | 3500 |
| Charging Cable (50 units @ INR 50/unit) | 2,500 |
| Tempered Glass (50 units @ INR 50/unit) | 2,500 |
| STAFF AND LABOUR | AMOUNT (in INR) |
| Entrepreneur’s Salary (@ INR 10,000/month) | 20,000 |
| UTILITIES & OTHER EXPENSES | AMOUNT (in INR) |
| Rent (@ INR 4,000/month) | 8,000 |
| Electricity (150 units @ INR 7) | 1,050 |
| Phone/Internet Bill | 250 |
| Stationery | 100 |
| Repair and Maintenance | 100 |
| TOTAL | 1,23,000 |
FINANCIAL SUMMARY (Annual)
| FINANCIALS | AMOUNT (in INR) |
| Fixed Cost | *** |
| Working Capital (for each cycle of 2 months duration) | 1,23,000 |
| Total Enterprise Set-Up Cost | 1,28,650 |
| Revenue (per annum) | 7,53,000 |
| Total Expenditure (annual working capital) | 7,38,000 |
| Enterprise Profit (per annum) | 15,000 |
| Payback Period (in months) | 5 |
BASIC ASSUMPTIONS
- Working days: 25 days per month (8 hours shift)
- Average daily revenue: INR 20,000
- Assistant required: 1
- 100% of the goods procured are sold
- Loan not taken into account
| Particulars | Quantity | Selling Price/Item (in INR) | Amount (in INR) |
| Mobile Charger | 50 | 150 | 7,500 |
| Headphone | 50 | 150 | 7,500 |
| Charging Cable | 50 | 100 | 5,000 |
| Mobile handset | 15 | 6,300 | 94,500 |
| Mobile Cover | 50 | 120 | 6,000 |
| Tempered Glass | 50 | 100 | 5,000 |
Note: All figures mentioned are indicative and for reference purpose only. Development Alternatives Group bears no liability for accuracy. For any further information, please contact Development Alternatives on +91-11-2654-4100 or +91-11-2654-4200.
Star Entrepreneur
Prabhu started selling mobile phones from his home after he completed his high school. Once he was confident enough of starting his own mobile shop enterprise, he rented a shop in the main market of Masari village (Mirzapur) in 2019. Through his enterprise, he could:
- Earn an annual profit of INR 98,000
- Hire 2 full time assistants from his village