Hero Agro Project Report-Prince Dudhatra

8/2/2019 Hero Agro Project Report-Prince Dudhatra

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Introduction

The purpose of this business plan is to provide the reader with a comprehensive

synopsis of Hero Agro Pvt. Ltd. and its plans of expansion. Hero PVC was

established in 1997 in response to the consumer demand for discounted PVC

products. The company manufactures and distributes a PVC pipes which is

marketed as a high quality, but discount, alternative to the existing range of PVC

products in the market.

Hero Agro Pvt. Ltd. is a company that has glittering present and sparkling future.

Within a comparatively shorter span of time, the company has scaled the high-

scoring reputation in Quality Product of ISI marked U-PVC Pipes, ISI marked

Plumbing Pipes, SWR Pipes, ISI marked Conduit Pipes, Blue Threaded Pipes as

per ASTM-D-1785, which has touched deep dusty frontiers of rural and also

macadamized horizons of Urban.

Having been well-equipped with the ultra-modern plant and laboratory, coupled

with professional management, well-harmonized experienced labors, enterprising

experts, the Company has been manufacturing striking variety of pipes, duly

tested, quite in tune with quality control standards.

The uncompromising thrust and the inherent quality emphasis throughout the

manufacturing and testing process, it has gained ISO 9002 the coveted

international mark of quality.

Nicely located besides Plot No. 2309 & 10, G.I.D.C. METODA it has deep

potential to have flourishing marketing possibilities. As the company is striving to

cater to the varied needs of its all valued customers, here the customer has to

invest his confidence only, so as to acquire the unfailing quality-bound products of

his choice.

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Since its founding, the business has proven to have met the market needs and

has generated an impressive supplementary income for the owner, Nileshbhai

patel , a reputed and a popular businessman. Given the company's record of

success the owner now intends to devote all of his attention to Hero Agro by

managing the business full-time and expanding its reach by enhancing existing

production capacity, adding an additional product line for PVC pipes and

expanding the company's sales efforts.

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Mission Statement

The mission of Hero Agro is to provide consumers with, and to be the preferred

brand for, medium as well as high quality PVC products at a reasonable price.

Because of its small scale of operation and narrow focus, Hero Agro has been,

and will continue to be, able to provide PVC products of equal or better quality

than the major brands. Hero Agro will continue to market PVC pipes and plans to

add a new range of PVC products to its product mix. These products will contain

the same ingredients as the major PVC products and will have the same effects,

yet will retail for about 10% lesser the price of existing brands.

Hero Agro intends to increase its production capacity and expand its sales effort

to include local discount retail chains, wholesale markets, agents and stockiest in

the Massive City area. Eventually, the company will broaden its scope to include

regional, then national distribution.

Its typical customers are those quality conscious, yet frugal, consumers, many of

whom are from lower-income families that seek to stretch their budgets wherever

possible. Hero Agro intends to meet the needs of this broad segment of

consumers through the provision of low cost, quality Products. The products will

be marketed as such, with an emphasis on their quality to distinguish Hero Agro

products from the more generic brands which emphasize price. In carrying out the

above measures, Hero Agro expects to establish itself as a preferred brand in the

market for PVC pipes for which a wide-range of consumers will come to recognize

and trust.

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Marketing Objectives

Hero Agro has set as its marketing objectives expanding its local market share

for U-PVC pipes to 7% and capturing a 5% local market share for Plumbing pipes

in the first twelve months following expansion. The company will achieve its short-

term objectives through an aggressive pull strategy, involving heavy advertising

and promotions based on its themes of product salability, quality, reliability,

effectiveness, affordability. The company's long-term goal is to capture a 1%

share of the national market for each of its products within the next five years.

This longer-term objective will be met by gradually relying more on brand identity

and name recognition in the local market and shifting its advertising focus and

marketing efforts to other regions of the country.

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Required Capital

In order for Hero Agro to successfully complete its plans for expansion, an

investment of 20 lakhs will be required. The owner Nileshbhai patel will contribute

10 lakhs of his own funds and is seeking a lender to provide the remaining 10

lakhs. The business anticipates the terms of the loan to be 6 years with a 15%

rate of interest that will be repaid in monthly installments.

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Description of the Business

Hero Agro currently manufactures lesser quantities of PVC pipes for a few local

discount stores. The company intends to expand its manufacturing capacity for U-

PVC pipes and will begin producing a line of PVC products.

The company acquired its existing base of retail customers through industry

contacts. The founder of Hero Agro Nileshbhai patel met the vice president of

SPMA (Saurahtra Plastic Manufacturing Association) at a social gathering, and he

urged Nileshbhai to go into business. This individual also provided Nileshbhai with

the names of several purchasing agents for independent area local markets and

discount stores. Many of these individuals expressed a desire to do business with

a regional discount manufacturer which gave Nileshbhai the impetus to start a

PVC pipe manufacturing operation.

The results from the introduction of the company's lone product has been

overwhelming, with Hero Agro unable to meet the local consumer demand for

discount U-PVC pipes. Orders for U-PVC pipes exceeded capacity within the first

three months of operation.

The company's sales have increased fairly consistently over the last two calendar

years, with some seasonal fluctuation. Peak sales for the PVC product are

realized during the summer months. However, Hero Agro anticipates greater

fluctuation in its U-PVC pipes sales. Summer months typically produce the largest

sales volume for this product, and winter the lowest. Nonetheless, the product mix

has been chosen, in part, to maintain revenues throughout each respective

seasonal variation.

Based on the demand for the current PVC products and strong interest in a

similar HDPE products (which Hero Agro does not currently produce), the time is

ripe for expansion. Given the company's ability to expand its production capacity

and add a second product, Nileshbhai expects gross sales to exceed 2.5 crores in

the first year of expansion.

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History of the Business

Nileshbhai patel founded Hero Agro in response a suggestion from a vice

president of SPMA (Saurahtra Plastic Manufacturing Association). This person

had mentioned Nileshbhai the potential for independent plastic companies to

substantially undercut the prices of major plastic companies in manufacturing and

selling products such as U-PVC pipes and PVC fittings. Nileshbhai realized the

potential market for such products and decided to put his trading and

manufacturing business backgrounds together to produce products catering to the

discount end of the price spectrum.

It was at this point that Hero Agro was set up as an independent PVC pipes

manufacturing company owned and operated on a full-time basis, solely by

Nileshbhai patel at Plot No.2309 & 10, G.I.D.C. METODA (Tal.:LODHIKA,

Dist.:RAJKOT)

Nileshbhai recognized that U-PVC pipes sales were vulnerable

to heavy fluctuations in sales volume due to variations in seasonal demand. He

thus chooses to begin his manufacturing operation with the production of PVC

threaded pipes on a limited basis for trial purposes. Within two months, demand

for the product from retail stores, local independent markets and wholesale

stores, and other neighborhood retail stores doubled to the point where his small

operation was running at near capacity. Within six months, demand had exceeded

the limited production capability of both the company and Nileshbhai, himself,based on the time and resources available to him. Based on this success, the

time is now ripe for Nileshbhai to concentrate all of his time and effort on the

expansion full-time operation of Hero Agro .

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Founder of the Business

Nileshbhai patel has a retail shop Deepak and company for machinery parts and

a showroom of sanitary wares. He held this position for 25 years, and used to

earn for his family living with his father. His father was a farmer and left his

farming ever since they came to the city for doing business.

Nileshbhai received his B.SC. Degree in chemistry from Virani Science College at

Saurashtra University. He worked with his father and had an experience of 25

years for retail business. He is a partner in Sukhdev chemicals a chemical

manufacturing company at Ankleshwar since 7 years. He also is a partner in RT

flour mills at Junagadh since 15 years. After the success of Hero Agro Products

Pvt. Ltd. manufacturing U-PVC pipes. Nileshbhai has recently started a new firm

Deepak Blow Molding Pvt. Ltd. manufacturing LLDPE water tanks.

Nileshbhais sweet statement ONE JUST NEEDS GUTS AND HE MAKES IT.

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Regulations and Licensing

The following permits and licenses were obtained in order for Hero Agro to

commence business:

Certificate of Incorporation (year 1996).

Certificate of Sales Tax (year 1996).

Certificate of Central Sales Tax (year 1996).

Certificate of ISI (year 1998).

Certificate of ISO (2000).

All necessary licenses and permits to commence business, take production, make

sales, etc. has already been granted to Hero Agro and its owner, Nileshbhai patel

.

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Market Definition

The plastic markets are vast opportunities for existing and new companies. Hero

Agro has been successful providing U-PVC piles at low prices for the end-users.

This geographic area is represented by roughly a 100 kms radius from the

company's location.

According to the survey, the Saurashtra region contains approximately 10

thousand buildings, 250 thousand tenements and 15 thousand farms at present.

In addition, of the current statistics the building and tenements are about to get

doubled with in five years. There are about 200 dealers dealing in different brands

of U-PVC pipes in the Saurashtra region. Due to large population the

development of the Saurashtra region is rapid. The dealers of the U-PVC pipes

are about to increase. Although a large percentage of population residing in the

Saurashtra region is between average and low income people U-PVC pipe users

are only 30% of the total population. Over the next five years there will be over

50% of the population using U-PVC pipes in the market. At present there are just

a few cities and infinite villages in the Saurashtra region. In addition, the dealers

and manufacturers for U-PVC pipe are about to increase up to 50% annually for

the next five years. This is reflective of the region's concentration on the U-PVC

pipe manufacturers. Manufacturing a low-priced U-PVC pipe could facilitate this

growth, because more families could afford it.

Current access to the U-PVC pipe for the users is due to the retail stores,

wholesalers and dealers. After the survey Hero Agro has decided to increase its

production capacity to achieve the targeted customers. Expansion of the business

is a must for all the manufacturers of U-PVC pipes to achieve their market goals.

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Market Segmentation

Hero Agro s geographic market has been established. Given the small size of the

company and fierce competition from large companies, Hero Agro s best strategy

is to analyze the demographics of its potential end-users.

Consumers

The Hero Agro s customers have very specific demographics, found in the Hero

Agro s Journal.

Over 40% are farmers.

Over 45% are builders.

Average income is 20 thousand per month.

50% of users belong to low families who have lower income.

However, the Indian industry report indicates that by 2010, plastic users will

reflect a normal distribution of the Indian population. Based on this projection,

significant growth will be in the farmers, builders and lower income segments.

Much of this growth will be supplied by the low-cost U-PVC pipes.

With the growth of the plastic products, Hero Agro plans to target lower than

average income areas with U-PVC pipes, threaded pipes and plumbing pipes.

The market researcher will establish the top five cities in the area to segment. In

addition, Hero Agro will be able to segment prior average income customers from

its database and target those that live in these areas. These segments are less

likely to own plastic products, but are very aware of their uses, especially given

where they live. In addition, Saurashtra Plastic Market magazine reported that

38% of galvanized pipe and HDPE pipe users who had heard of U-PVC pipes

were considering buying one. According to the report, this was the largest

segment interested in U-PVC pipes.

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Market Research

Nileshbhai identified the need for discount U-PVC pipes when a local discount

store owner asked him to produce such products based on the demand from the

consumers at his store. Contacting several additional independent store owners in

the local area (local dealers, open market agents, and other retail shops);

Nileshbhai found others interested in offering these items as well.

The national market for discount plastic products is well documented. The

National Journal of Business has reported that booming consumer interest in

reliable value consumer products (such as those that open markets produce) has

broadened to include plastic products as well. Finally, a recent edition of the

Saurashtra Plastic Marketnamed the city area as a specific example of an areawhere demand for discount plastic products was currently far exceeding supply.

The research Nileshbhai has performed has led to the conclusion that these

trends will continue in a positive direction.

Further research has identified distinct groups of consumers in the broad market

for plastic products by which the market can be segmented. The market can be

broken into three distinct segments. First, those price sensitive, lower income

consumers who primarily purchase products based on the lowest available prices

make up a growing percentage of the market for plastic products. Next, an also

growing segment of middle income consumers tend to make purchasing decision

based on value (the best quality at the best price). Finally, higher incomeconsumers, which make up a declining majority of the market, tend to be brand

conscious in their buying behavior, meaning that they purchase products based

on the perceived higher quality of major brands.

Based on this market research and company forecasts, Nileshbhai has developed

a winning strategy for capitalizing on the consumer demand for discount plastic

products by effectively targeting certain segments of this market.

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Target Market

Consumers of U-PVC pipes and threaded pipes are similar enough to be

considered as one target market. Thus, a dual product mix makes sense from a

marketing perspective, apart from economic reasons. According to Industry

Week magazine, the two largest customer segments for each product are

dealers (who make purchases both for themselves and for their customers) and

single individuals. For U-PVC pipes, there are also substantial sales to people

with high quality occupations and those who are accustomed to low quality. Busy

executives, farmers, and builders were cited as examples of individuals who make

up this part of the market.

More importantly, the company's market research has determined that the fastest

growing market segment is the nice market composed of those individuals who

prefer, and who give priority in their purchasing decisions to, discount products.

This segment of the market for plastic products has been identified as those

consumers whose primary consideration in purchasing decisions is the lowest

available price. Further, the market segment consisting of those individuals whose

primary purchasing decision revolves around value (i.e. the best quality for the

best price) is also showing an upward growth trend as a percentage of the total

market.

These two growing market segments have been reflected in the trend in

consumers preferences with regard to point-of-purchase decisions. While open

markets and retail store chains continue to be the major sellers of plastic

products, their market share has shown a declining trend. This decline is

accelerating and is predicted to more substantially undercut their position in the

market over the coming years. Discount stores, in the meantime, have shown a

rapid increase in gross sales and a corresponding upward trend in their market

share in contrast with the larger markets and store retailers.

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Hero Agro expects to capitalize on this regional and nationwide trend toward the

discount end of the product spectrum by expanding its capability to provide low

cost products which meet the needs of low income and value conscious

consumers, the two market segments the company intends to target.

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Competition

Plastic manufacturers for U-PVC pipes and threaded pipes are neatly divided into

two distinct categories within the industry: Huge plastic manufacturers research

and development companies who outsource their production requirements or who

have in-house manufacturing facilities, and the small, independent pipe

producers.

The huge plastic manufacturers R&D companies capitalize on their substantial

research and development capabilities. Their capital backing, brand recognition,

advertising capabilities, sales budgets, and effective distribution channels keep

their products on the shelves and in consumers' minds.

The much smaller, independent pipe manufacturers typically have a minimal

research and development function consisting primarily of labs used to analyze

products other companies introduce. They are usually very small (less than 50

employees), and have limited manufacturing facilities. They usually distribute

locally or regionally, occasionally maintaining a regional account in another part of

the country. These companies often compete on price due to the limited scope of

their operations. Hero Agro fits into this industry cluster of independent

manufacturers.

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Product, Branding, Packaging

Strategy

The plastic product line is based on high quality and durability at a low price. The

specific product will not contain any heavy objects nor will it require any cement to

join the two parts. The plastic fittings required to join them are easily available at a

local retail shop. The components used to assemble them are:

Plastic pipes.

Plastic fittings.

Plastic solvent.

Hero Agro s products are offered as a generic alternative to the higher priced

more established and recognized brands. However, Hero Agro has a loyal

customer following and maintaining this is imperative. The Hero Agro brand

stands for quality and durability at low prices and represents the price sensitive

customer who isn't willing to pay more for the same level of quality. Maintaining

service and price / performance measures will facilitate the general brand

strategy.

The Hero Agro s U-PVC pipes will contain the Hero Agro s logo tag, as all their

products do. In addition, the plastic bags used for packaging will contain the Hero

Agro s logo in the center. This is an emerging trend and is expected to add brand

recognition to the Hero Agro s label.

The product strategy should address questions such as the following:

What will be the main ("keystone") product attributes?

What are the benefits (both functional and emotional) that we expect

customers to derive from using our product?

How do these attributes and benefits appeal to the target market and support

the marketing position

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What shall be the strategy for branding?

How will the product attributes and benefits be represented in the branding of

the product?

What will be the specific strategies for packaging?

Product container (shape, size, etc.)

Colors

Copy (the words, slogans, etc. we use to describe our product)

Typefaces

Designs

Illustrations

Physical environment

How will the product attributes and benefits be represented in the packaging of

the product?

Are there any unique packaging requirements or issues to be resolved?

Will there be any product variations? What? Why?

If applicable, how will different product lines be distinct from each other?

Are there any product characteristics that will be de-emphasized? Why?

How?

Will any products be eliminated from the current offering(s)? Which ones?

Why?

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Pricing Strategy

Hero Agro s competitive advantage is offering quality and durability at low prices.

The plastic industry has several price points, depending on the product and

market. For U-PVC pipes of 4 kgs, the price point is low. When U-PVC pipes of 6

kgs reach this point, consumer sales increase significantly. For ISI marked U-PVC

pipes, the price point is high to medium. Low-priced U-PVC pipes, like those that

Hero Agro currently provides, have price points from medium to low. A 5%

volume discount and FOR is given to the retailers and dealers that buy direct on

purchases of a truck load or more.

The Plastic, a typical plastic magazine, and Plastic Today, a more technical

trade publication, have consistently reported that high-price plastic products will

not sell well until the price drops below the current prices. Currently, there are

several options in the market, but they appear to be too expensive in relationship

to the functionality they provide. Advances in plastic production and lower pricing

for the plastics that make up the U-PVC pipes will allow Hero Agro to sell a

complete quality U-PVC pipes starting from the low price. At this price point, the

U-PVC pipes offered by Hero Agro are of medium category, not of high category.

This makes it affordable to more households and farmers.

Hero Agro will be able to continually reduce the price as the petroleum, and

chemicals are reduced in price. Since the farmers do not require high quality U-

PVC pipes, Hero Agro can sell low-cost U-PVC pipes to them with a discount. It

is not necessary to offer the high-cost U-PVC pipes to the builders and

households as medium quality U-PVC pipes would do with them. Hero Agro can

continue to purchase low graded raw materials and chemicals so as to reduce

their prices and to give discount to its customers.

The U-PVC pipes can be fixed by plastic as well as galvanized fittings so as to

make it easier and cheaper for the end user to buy them.

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In accordance with Hero Agro s practice, the new U-PVC pipes will not be

discounted for seasonality or type of buyer. However, some sort of volume

discount price structure will be established prior to the product's introduction.

The pricing strategy should address questions such as the following:

Where we set our price in the price / value range?

How we price our product / service (e.g. by the hour/day/week, by the unit of

servicesingle, multi-pack, case, truckload, a set commission, a pre-

determined fee, etc.)?

What is our price structure? Shall we have a discount structure? If so, what is it?

Will prices vary according to geographic regions?

Will prices vary according to seasons?

When and how shall we decide to raise / lower prices?

When and how shall we decide to change discount structures?

What is our level of pricing flexibility (short-term profit vs. long term goals)?

What are our pricing terms and policies?

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Distribution Strategy

Hero Agro does all its manufacturing and administrative functions from its head

office. The company will distribute its products through its current 3 channels:

Direct Sales:

Approximately 75% of Hero Agro s products are purchased directly and either

packaged for customer pickup or direct transporting. This demand is created

through local advertising, repeat business, and word of mouth. This channel is

expected to also represent 75% of its product sales volume.

Plumbers:

Approximately 15% of Hero Agro s products are distributed through plumbers to

small and medium builders and households. Local consultants are aware of the

inexpensive quality products that Hero Agro offers and use their equipments

while installing the U-PVC pipes to price-conscious customers. It is expected that

less than 15% of its product will be sold through this channel.

Distribution Channels:

What are the available types of distribution channels?

What are the desired types of distribution channels? Why?

What kind of geographic coverage is required?

How shall we penetrate the desired distribution channels?

How shall we negotiate agreements between our company and the selected

distribution channels?

How shall we monitor distribution channels?

How shall we ensure consistent product / service positioning and image

throughout our channels?

What information needs to be exchanged back and forth with our distribution

channels?

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How will information be exchanged?

What will be the terms with each distribution channel (e.g. payment, financing,

warranties)?

Placement:

Where will our locations be?

Shall we add locations?

Shall we purchase or lease?

Should we use independent outlets?

Manufacturer / Wholesale Firms:

What shall we do to reach market coverage and / or shelf space goals?

What stores shall we target and when?

Shall we include our entire product / service line or one at a time?

General:

How shall we penetrate the market (i.e. market by market, greatest

opportunity, simultaneous)?

What shall we do to penetrate the market?

Shall we use minimum order requirements?

Shall we offer exceptions to the minimum order requirement?

Shall we offer return privileges?

How will orders be processed?

How much inventory should be accumulated?

Where that inventory should be warehoused?

How and when should goods be transported?

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Advertising Strategy

Hero Agro operates on a minimal advertising budget using strictly print media.

The company advertises daily in the Saurashtra regional newspapers, weekly in

community newspapers, and periodically in local business publications. The

advertising budget is 2% of gross sales and is planned to expand to 3% during

the first 6 months of the plastic product.

The advertising strategy should address questions such as the following:

How will we use print, radio, and / or television ads?

Shall we use other electronic media (e.g. videodisc, videotape, audiotape,

etc)?

How shall we exploit our logo or other characterizing motifs?

How shall we use the packaging itself for advertising (e.g. bound or insert

ads)?

What kind of point of purchase actions shall we take?

Shall we use signage (billboards, placards, or display signs)?

Shall we utilize brochures, booklets, or related collateral?

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Sales Promotion Strategy

Hero Agro generally keeps its sales promotions to a minimum, since its strategy

is to maintain everyday low cost pricing. To supplement advertising, Hero Agro

provides its local retail channel brochures and product comparisons on reliability,

service and price. In addition, Hero Agro provides the retailer with display logos

and signs to differentiate its product line. With the introduction of the new plastic

product, Hero Agro will run in-store demonstrations every other weekend for a

period of 6 months in order to stimulate interest and demand for the product.

During the demos, an Hero Agro T-shirts, hand-bags, key-chains, purses etc. will

be given to the plumbers and retailers.

The sales promotion strategy should address questions such as the following:

Shall we run coupon or rebate programs this year?

Shall we offer premiums, contests, or sweepstakes?

How many give-away or samples shall we plan and for whom?

Shall we use cross-offers or tie-ins?

What kind of actions shall we take with trading partners?

Shall we use allowances (trade-in, attractive financing, bonus quantities,

volume discounts)?

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Publicity and Public Relations

Strategy

Hero Agro s public relations budget is very small. Hero Agro encourages its

employees to become involved in their community and to voluntery for local

causes. The company provides employees with free T-shirts to wear and hand-

bags to carry, displaying the company logo at events. In addition, Hero Agro

sponsors retailers, wholesalers and plumbers little league team. Since the plastics

are currently used the most in the market today, Hero Agro plans to agree the

introduction of the U-PVC pipes with a new PR program involving public places.

Hero Agro will participate in technology seminars and workshops to demonstrate

how easily U-PVC pipes can be used.

The publicity and public relations strategy should address questions such as the

following:

What public events we have planned (seminars, workshops, open houses,

presentations)?

Do we need formal and / or informal lobbying efforts?

What press releases do we have planned and when will they be released?

Shall we need outside assistance with your efforts?

Shall we conduct facility tours?

Should there be any speeches given to community or professional groups?

Shall we produce a company news letter? Who else receives copies?

What is the time table for our annual report?

Shall we engage in sponsorship relationships?

How shall we interact with our immediate and extended community?

Do we have a volunteer or charity affiliation?

What are our plans for charitable donations and in kind contributions?

Shall we fund the arts?

Shall we retain a public relations firm?

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Strengths

The main strengths of Hero Agro are as follows:

Consistently deliver quality products that exceed service records of

competitors' products.

Strong word of mouth advertising among existing customers.

Strong repeat business among consumers and business market segments.

Niche distribution channel relationships. Hero Agro maintains loyal distribution

with small retail outlets and local wholesalers through consistent product and

service.

On order sales. Hero Agro maintains a knowledgeable and courteous inside

sales staff. The small size of the company requires job rotations from

manufacturing to sales to transporting and receiving to supplier and inventory

management. All employees know many aspects of the business which helps

provide a better customer experience when ordering.

Location. Hero Agro is located in the heart of the Metoda industrial estate and

most of its employees live 10 kms of work. Living in the heart of the

Saurashtras biggest industrial estate provides an added advantage to

purchasing trends.

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Weaknesses

The main weaknesses of Hero Agro are as follows:

Economies of scale. Hero Agro s low volume doesn't allow for large volume

purchasing like its bigger competitors. This creates lower margins.

Marketing budget. Hero Agro cannot afford expensive marketing and

advertising campaigns.

Small staff. Absenteeism and employee turnover severely affect the day to day

operations and service levels for Hero Agro .

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Opportunities

The main opportunities facing Hero Agro include:

High growth rate of U-PVC pipe users.

Potential customers over the next five years are about to increase up to 50%.

Continually increasing percentage of current and targeted customers will help

in having multiple dealers, agents, wholesalers and retail shop customers.

Saurashtra region has the highest concentration of startup firms in the Gujarat,

many needing low-priced reliable U-PVC pipes and fittings.

Current galvanized and HDPE pipe households will consider purchasing the

U-PVC pipes because of its low price.

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Threats

The main threats facing Hero Agro include:

Shifting technology risks. The high tech industry is dynamic and ever-

changing. Although market studies predict incredible plastic user growth,

growth rates may prove to be slower or new technologies may arise. Although

Hero Agro maintains low inventory levels, the initial investment could be at

risk or impede cash flow if the trends do not grow as expected.

Current supplier might not offer the components necessary to produce U-PVC

pipes. Switching suppliers can be costly and time-consuming, affecting service

and price.

New and up coming technologies could erode Hero Agro s market share

through its specialization and engineering expertise.

Consumers are becoming increasingly knowledgeable regarding plastic

products and feel more comfortable servicing the U-PVC pipes

themselves. Hero Agro s superior customer service may be less desirable in

the future and Hero Agro will not be able to differentiate its products as

effectively.

Increasing commoditization of the plastic products. Plastic product prices have

continually dropped. Hero Agro will need to stay competitive through efficient

manufacturing and inventory control.

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Resulting Issues

The main issues that must be addressed by this plan include:

Hero Agro has a stable market share and customer following. These

customers are indicative of the current market of U-PVC and fittings.

Hero Agro product differentiation strategy is low price and service. Employee

retention is the key to maintaining production and service levels.

The target segment does not currently own U-PVC pipes and is very price-

sensitive.

Hero Agro will need to frequently update its market analysis to ensure that U-

PVC pipes growth projections are being realized and that it is properly serving

this market with its product expansion.

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Financial

Nileshbhai has set two financial goals for Hero Agro :

Increase Sales Revenue by 20% over last year by expanding product line.

Increase Total Net Profit for the projected year by 17%.

Description Last Year

Mar-03

This Year

Mar-04

Projection

Mar-05

Projection

Mar-06

Sales Revenue 3,75,00,000 3,50,00,000 4,00,00,000 6,00,00,000

Sales Unit Volume 1,87,50,000 1,75,00,000 2,00,00,000 2,50,00,000

Average Contribution

Margin / Kg 47 50 46 44

Total Fixed Cost 80,00,000 96,00,000 86,00,000 78,00,000

Total Net Profit 6,00,000 12,00,000 20,00,000 30,00,000

Average Profit Margin /

Kg 1 1 1.5 2

Return on Investment

(ROI) 40% 25% 20% 10%

Return on Assets (ROA) 12% 8% 6% 18%

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Marketing

Nileshbhai has set the following marketing goals for Hero Agro :

Maintain current market share percentage in PVC product line as industry

grows at 10%.

Establish market share penetration in plastic category at same level as PVC

product line.

The following table (Marketing Goals) shows monthly marketing goals specifically

related to the PVC product line.

Description April

2004

May

2004

June

2004

July

2004

August

2004

September

2004

October

2004

November

2004

December

2004

January

2005

Overall

Market

Share 7% 5% 5% 3% 2% 2% 4% 6% 6% 5%

Number of

Products

Available 7 7 7 7 7 7 7 7 7 7

SalesClosure

Rate 6% 5% 8% 10% 10% 7% 6% 6% 5% 6%

Repeat

Purchase

Rate 1% 1% 1% 0% 0% 0% 0% 1% 1% 2%

Number of

Distribution

Channels 4 4 4 4 4 4 4 4 4 4

Number of

Target

Segments 1 1 1 1 1 1 1 1 1 1

Number of

Customers 15 18 13 8 9 7 10 12 14 14

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Product

Plastic pipes are the key to the future because they are built to last. They are

corrosion and maintenance free in other words, totally reliable. And there are

other advantages; they have a smooth inner surface and are very easy to joint.

Moreover theyre light therefore easily handled, transported and installed.

Per meter, plastic pipe system usually cost less than any other pipe system,

especially when including installation costs in the comparison. This is because the

low weight of plastic pipes, even in large diameters, means they can be handled

manually rather than using expensive machinery. Add to this the case of jointing

and lower installation costs result.

Rigid PVC pipes have sufficient strength to withstand internal and external

pressures, bend and impact. Thanks to its remarkable flexibility, the pipe is safe

against both traffic loads and slight ground movements. Rigid pipes hate excellent

non-aging property. The material does not age at all for long periods of time.

Hero Agro pipes are a result of continuous research and development of higher

quality and better performance PVC pipes. In the agricultural and industrial field,

Hero Agro pipes have acquired an excellent reputation for its outstanding

workability and functional versatility. Hero Agro is not a simple pipe and fitting

manufacturer, but also undertakes the planning, design and installation of all

kinds of pipelines. Come and consult Hero Agro on any problem you may have

concerning pipes.

The name Hero Agro is synonymous with good design, aesthetic appall, case of

installation and efficiency in service when applied to rigid PVC pipes for

agricultural and industrial pipe work systems.

While the perception exists among consumers that discount products are not as

effective, Hero Agro believes that a company such as it can further dispel this

notion through clever advertising and promotion which will substantially broaden

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its appeal among brand-conscious consumers. This strategy will effectively allow

Hero Agro to become the brand of choice for the value-conscious consumer and

potentially an even broader market segment.

Hero Agro has and will continue to stress its proximity to local markets and its

just-in-time inventory system as a method for enhancing delivery of orders and

providing quality customer service. By continuing to focus on the local market,

Hero Agro can fine tune its operations for both products and establish limited

brand awareness before expanding its scope regionally and nationally.

General Properties of PVC pipes manufactured by Hero Agro are as under:

Light Weight: The weight of Hero Agro rigid PVC pipes are at least 1/5

that of steel and 1/8 that of lead pipes. Such lightness facilitates handling,

storage, transport and installation.

Fire Retardant: Hero Agro Rigid PVC pipes do not support combustion

therefore they are non-inflammable and are self-extinguishing.

Rust & Corrosion Resistance: Metallic piping materials give way to soil

corrosion but Hero Agro Rigid PVC pipes are not affected by liquid minerals in

soil, bacteria, algae or fungi.

Chemical Resistance: Hero Agro Rigid PVC pipes are highly resilient to

Acids, Alkalis, Alcohols, Aliphatic solvents, various other r chemical and

gases.

Weather ability: Hero Agro Rigid PVC pipes are unaffected by humid or

salty atmospheric conditions.

Smooth Internal Bore: The smooth internal finish of the pipe ensures

better flow properties compared to metallic or cement pipes.

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Easy to Install: Hero Agro Rigid PVC pipes are installed by solvent jointing with

solvent cement. It is the fastest and easiest method to produce good strong joints.

Comparison of PVC with Galvanized, Cast, Asbestos and Cement Pipes

Economic

factors

Galvanized

iron Pipes

(GL)

Cast Iron Pipes

(CL)

Asbestos

Cement

Pressure

pipes

Rigid PVC

pipes

Economic

advantages of PVC

pipes

Wight Heavy Heavy Lighter than

CL but

heavier than

PVC

Light, pipes

weight 1/6th of

CL & 1/6th of

GL & 1/5th of

AC

Savings in handing

and transportation

costs, installation is

easier

Length

In meters

5-6 3-4 3-4 5-6 Less number of

joints, Savings in

installation tie and

costs

Inside Bore Rough Rough Smooth Mirror Like

Smooth finish

Less frictional loss,

Saving in pumping

costs

Co-Efficient offlow (c) value

100 Decreaseover a period

of use

100 for new pipe40-50 after 5 to

10 years

140 150-Remainsconstant

throughout its

life

Better flow, Moredischarge of water

25% more flow than

GL pipes

Resistance to

corrosion

Pipes are

susceptible to

(1) quality of

water (2)

aggressive

soil conditions

Pipes are

susceptible to (1)

quality of water

(2) aggressive

soil conditions

Good Good

Resistance to

even strong

acids, alkalis

or salt

solutions

Longer life of the

pipe. Low

maintenance and

replacement costs

Installation

technique

Involves

threading

Cumbersome

and time

Easy when

compared to

CL

consuming

Very easy,

simple and

fast

Reduces

installation cost.

Ensures speedy

implementation of

the scheme

Material cost High Lower than GL Lower than

CL, GL, 7 AC

Greater savings in

material cost. Total

cost considerablyreduced due to

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savings in both

materials and

installation cost.

PVC Compound Mixing Ratio:

Sr. No. Raw Material / Grade Weight in KG

1 PVC Resin (K-6701 / K-6711) 50.000 Kg

2 One-Pack (RP-602 / 603 / 604 / 605 / 617) 1.800 Kg

3 Filler: CaCo3 (TC-301/DL-1030) 5.000 Kg

4 U.V.Stabiliser (TiO2+0.4%Carban Black) 0.200 Kg

5 Lubricant: (External: - Paraffin wax

Internal: - Calcium stearate)

0.500 Kg

0.400 Kg

PVC is available in the following grades:

Unmodified grade

Molding grade

Extrusion grade

Impact modified grade

Plasticized grade

Flam retardant grade

Manufactures & Suppliers of PVC Resin:

Reliance (K-6701)

Finolax (FS-6701)

IPCL (Indian Petrochemicals Corporation Limited)

Additives: The additives needed to manufacture PVC pipes are:

FILLER: Though fillers are primarily known for use for cost reduction, there are

other important advantages that can be derived from fillers. Viz. increased

rigidity and flexural modulus, increased hardness and density and increased

fire retardancy. Thus fillers can be classified as non-functional/extender and

functional depending upon role they play in PVC compounding. Of course non

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functional fillers used primarily with a view to cost reduction also inadvertently

act as functional filler

Calcium Carbonate (CaCo3): The most widely used filler, both as an

extender and functional filler, for PVC is calcium carbonate. It is available in

three different forms, as pulverized limestone, as precipitated CaCo3 and even

as marble dust. The first two are extensively used in PVC. Their surface

treated forms are also substantially used to improve their homogeneity with

PVC and overall processing at higher filler loading.

Naturally occurring CaCo3 as chalk or limestone is good extender for cost

reduction. It contains small concentration of MgCo3 and Fe2O3 and up to 1%

Aluminum silicate. It imparts good whiteness to PVC compound.

CaCo3 obtained form lime by chemical reaction is also widely used in PVC

industry; through it is somewhat more costly than the limestone based CaCo3.

Use of precipitated CaCo3 leads to increase in impact strength, rigidity,

weathering resistance as well as good gloss and finish. They further help

reduce the plate-out of lubricants and add to specific gravity of the compound.

They have moreover higher absorption of plasticizers, stabilizers and fillers

compared to natured CaCo3, having greater surface areas, due smaller

volume of fillers.

UV Absorbers: Light in the damaging wavelength range excites the PVC

polymer molecules, in the sense of imparting excess energy sufficient to break

bonds in the molecular chains: the free radicals formed as a result initiate, and

participate in, the degradation process, which is accelerated by the presence

of oxygen

Whilst many heat-stabilizers and antioxidants provide a measure of protection

against photolytic and photo oxidative degradation of PVC materials for

outdoor use afford additional and complementary protection, in that they

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absorb and dissipate the incident UV radiation essentially before it can initiate

degradation, without themselves undergoing de-activating chemical changes.

Titanium dioxide (TiO2): Titanium dioxide is a UV absorber; it is

evident that increase in the amount of this pigment in the PVC compound willreduce the amount of degradation, which takes place when the PVC is

attacked by damaging UV radiation.

Carbon Black: As a constituent of plastics compositions carbon

black can have three main functions. It may be incorporated to impart black

color, or to improve to photochemical and thermal degradation, or to reduce

electrical Resistivity. In the first two of these three applications the amounts

added are relatively low (commonly a few phr), and the additive may be

considered to function as, respectively, a pigment and a kind of stabilizer. The

stabilizing effect is particularly utilized in some PVC compositions for outdoor

use.

Lubricant: Lubricants fall in to five categories:

Metallic stearates,

Fatty acid amides and ester,

Fatty acids,

Hydrocarbon waxes and

Low molecular weight polyethylenes.

PVC needs large concentrations of calcium stearate and hydrocarbon waxes,one serving as an internal lubricant and the other as external lubricant low

molecular weight poly ethylenes are reported to be among the most efficient

external lubricants available.

Heat Stabilizer: PVC resins as such are very heat sensitive and have to be

processed at low temperature and as such, heat stabilization is extremely

important. Whatever Stabilization may be used, all of them have common

function-to arrest or retard PVC degradation by:

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Neutralizing hydrogen chloride atoms with other groups which are

more stable.

Exchange or displace labile chlorine atoms on the polymer chain

with other groups of greater stability. Inactivate Stabilizer degradation products.

Impact Modifiers: Most PVC products are at risk of possible damage by

impact at some point during their lifetime, either through accidental hits or

drops (e.g. PVC pipes during transport and installation; PVC containers in

transport in transport and storage). Effective Modifiers have the following

requirements:

Must be insoluble in the PVC matrix and must have good adhesion between

the continuous glassy phase and dispersed rubber phase.

It should not adversely affect other properties like low permeability and low

order of taste and odor.

It must retain the elasticity at low temperatures particularly for the Outdoor

applications in colder climates. It must have good thermal and light stability.

Processing Aids: The polymers used as processing aids in PVC are of the

following kinds:

Acrylates and methacrylates (acrylic processing aids).

Styrene / methacrylate copolymers. Acrylonitrile / butadiene / styrene (ABS) polymer.

Styrene / acrylonitrile (SAN) copolymers.

Poly--methylstyrene (PAMS).

Processing aids are employed in rigid PVC compositions, in relatively low

proportions to facilitate melt processing. The typical effects of their presence

on the stock are:

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Increased rate of homogenization and fusion, except in the case of

lubricating processing aids which extend fusion time.

Improved strength, cohesion and extensibility of the melt.

Reduction of melt modulus and nerve, die-swell, and tendency to

melt fracture.

Increased melt viscosity.

Tendency to increase torque and back-pressure in extrusion,

attributed to the faster, higher-shear character of the fusion process.

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Production

Hero Agro purchases its raw materials and chemicals from reputed brokers in the

Massive City area. These raw materials and chemicals are delivered to Hero Agro

directly, and are kept in special sealed plastic bags and drums in a temperature

controlled environment with specially secured locks. Only the engineers will has

access to these raw materials and chemicals, as some of them are highly

hazardous and expensive.

First of all the quality controller checks the grade of the raw materials and

chemicals, then the raw materials and chemicals are put into the compounded

mixture. Here the raw materials and chemicals are compounded accordingly.

After mixing a batch of either one of its products, the engineers will supervise the

mixing efforts. Next, the raw materials and chemicals will be automatically loaded

onto an attached mixer in a highly compressed state, where they will be mixed

into a base.

Second after the mixing process is over the raw materials and chemicals are put

into the cooling tank. After the cooling process is over the final material is loaded

into the whopper through a suction pipe with a spring. Here the raw materials and

chemicals are mixed thoroughly and filtered so that no dirt or other materials are

mixed with them.

Third the extruder is heated for about 4 hours before it starts operating. The die is

fixed on the extruder according to the size of the pipe needed to extrude. As the

pipe flows out of the extruder through the die the vacuum process is started to

keep the pipe in shape. Cold water is sprayed on the pipe to get the temperature

down so that the pipe gets hard and solid. A chilling plant is associated with the

sprays which chills the water after it is sprayed on the pipe.

Finally the extrusion process is done and the pipe is ready to flow out of the

extruder. As the pipe flows out of the extruder the tracking machine tracks the

pipe and the pipe flow is continuous till it reaches to the cutter. An ink-jet printer is

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kept in between the tracker and the cutter which prints the labels, name and the

logo of the company on the pipe. The cutter while cutting the pipe moves to and

fro. The cutter is ready to cut the pipe as the pipe gets up to 6 meters. The pipe

after it is cut goes to the tilting machine where the pipe is set to rest.

The pipes are now sent to the belling machine where the belling process is done

according to their sizes. Where as some pipes are sent to the lathe machines

where threading is done according to their sizes.

There will be very few hazardous activities associated with the manufacturing

process. The machinery is having double-locking mechanism which will not permit

operation while they are open, and is having few moving parts on the outside.

The only hazardous elements of machinery operated in Hero Agro design

scheme will be the cutter which cuts the pipe as it gets to 6 meters. Rest all the

activities are safe and secured.

Nileshbhai after consulting with an insurance team and the ISO team has

determined solutions for most of these problems. Special cover will be applied to

the exterior of the machinery which will prevent burning, cutting and other injuries.

Finally, employees will be instructed on the proper distances and safety

precautions necessary when working around the cutter and will be educated on

the lanes and speeds used by the cutter during those few times it will be in

operation.

Finally, given the company's willingness to take these precautionary measures,

his insurance company has agreed to extremely reasonable workers'

compensation rates which will cover all work-related injuries in Hero Agro s

facilities.

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Product Decisions

Hero Agro considered several options for adding another discount plastic product

to its product mix. However, the company chose to introduce a product that will

have the greatest similarities to its existing U-PVC pipes in terms of production

requirements, marketability, and consumer demand. Hero Agro has decided to

add plumbing pipes, thus, limiting its product mix to two: U-PVC pipes and

plumbing pipes.

These two products are believed to be the ones with the highest profit margin

within the plastic industry, based on the market research Nileshbhai has

performed. As well, the solid forms of these two products make them suited to the

same production equipment and similar processes. Both products can also be

produced economically on a small scale. Finally, the consumer demand appears

to be increasing for both of these products even faster than the market average

for over-the-counter plastic products in general.

While each of these two products fills an important market need, they do not

compete against each other since they are designed to install at different places

as required. These areas also have different seasonal patterns of sales. Market

research shows that U-PVC pipes sales are skewed toward the winter months

when water lever increases. By contrast, sales of plumbing pipes, while more

consistent, are skewed slightly toward the summer months when water lever

decreases. Since most plastic products can be easily reproduced, Hero Agro has

the potential to expand its business by moving into other related product lines.

Similarly, Hero Agro has the capability to use its manufacturing equipment and

laboratories in a flexible manner, adapting its production processes and

manufacturing focus accordingly.

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Plant and Machinery

Introduction: DGP WINDSOR KTS-140 twin-screw extruder (contra rotating) is

used in a processing department of Hero Agro Products Pvt. Ltd. for making U-

PVC pipes for potable water supply and plumbing purpose. With size range from

20mm to 110mm outer diameter. It contains several parts like:

Extruder.

Sizing / Cooling Unit.

Haul-Off Unit.

Cutting Unit.

Tilting Unit.

Extruder:

Screw:

No. of screws: 2

Screw Diameter: 65 mm

L/D Ratio: 18: 1

Torque max / screw: 130 Kg.m.

RPM range: 4.5 to 45 rpm

Speed Reduction: Through Windsor design primary, secondary gear box and

V belts

Heating:

Barrel:

No. of heating zones: 4

Total capacity: 14.5 kW

No. of cooling zones: In last two zones

Temperature control: By anticipatory proportionating temperature controller

Adaptor:

Heating capacity: 3.5 kW

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Die:

No. of heating zones: 5 Capacity of each zone: 5 kW (max)


Main Drive:

A.C. Motor: 11.25kW (15HP)

Speed: 150-1500 RPM

Hopper Feed Unit:

Hopper capacity: Volume 110Ltr or 70 Kg polystyrene

Capacity to deliver: 150 Kg/Hr. PVC resin

Thrust Capacity:

Set of bearings on to give a safe working for barrel pressure of 3000 psi

life of bearing at 3000 psi and 40rpm.

Venting:

Vent provided on barrel at 9.2 D from end of feed pocket.

Vacuum Pump for Venting:

Max. Vacuum: 24 Hg

Suction capacity: 10cfm

Total Wattage of Heater (Without Die):

Heaters on barrel: 19.5 kW

Drive Motors:

Extruder: 11.25 kW

Blower (main motor): 0.20 kW

Hopper feed: 0.37 kW

Lubrication pump: 0.75 kW

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Barrel cooling blower: 0.75 kW

TOTAL WATTAGE: 32.8 kW

A.C. Supply:

Voltage: 450 V 5%

Frequency: 50 Hz 4%

Main Drive: The main 15 HP A.C. motor with inverter control is accommodated

within the base. The power from the motor is transmitted V belts & pulley.

Gear Box Unit: The Drive from motor shaft is transmitted to the primary gearbox

through V belts. Additional safety is ensured by shear pin arrangement that is

mounted on input shaft of primary gearbox. This gearbox is connected tosecondary gearbox shaft by coupling. Secondary gearbox transmits power equally

to two output shafts with desired direction of rotation i.e. contra rotating. All the

gears are case hardened and ground to obtain high wear resisting properties.

Screw: The screws are contra rotating which provides a positive displacement of

the material and better mixing and greater output for a given screw diameter. The

twin screws are made up of nitralloy steel nitride hardened and polished to ensure

very smooth surface. The screw profile is designed taking care of the various

parameters of plastic materials behavior during processing. It represents the

most up-to-data concept in twin-screw extruders. The screw is made up of six

sections all of which form an integral screw. The core depth of screw is kept same

but the pitch and number and starts are different for each section to tale care of

the processing requirements during the material movement, in them. Very close

tolerances are kept between screws and barrel and in between two screws to

minimize the back flow of material during processing. The screw speed can be

read form speed indicator and current form Ammeter on remote control panel.

The screws have a through hole drilled in the center, which is partly filled with

thermic fluid and plugged. The thermic fluid takes away the excessive heat

generated in the metering zone and gives it away to the cold material in the feed

zone. Thus it helps to maintain the temp. of the screw uniform throughout its

length. The screws have a hole provided in the center, which is partly filled with

THERMIC FLUID and plugged. The fluid takes away the excessive heat

generated n the metering section and gives it away to the material in the feed

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zone and thus helps to maintain the temp. of the screw uniform throughout its

length.

Venter Barrel: The barrel is manufactured in sections and section and section

are bolted in line at6 their mating flanges by a split C clamp. The barrel section

are made of Nitralloy steel duly nitride hardened. A Vent-hole is provided for

removal of volatiles by means of a vacuum pump. For easy of cleaning the barrel

bores, the whole barrel assembly is provided with an arrangement to pull the

entire assembly in the forward direction and then swing on the vertical axis so that

the bores can be approached easily from both the front and rear ends. For the

purpose of temperature control, the barrel is divided into four zones. Individual

heating of each zone is by single-phase resistance heater and the associated

thermocouples are housed in a separate control cabinet. The front section of the

barrel is equipped with heaters and blower to provide for air-cooling in case of

temperature overshoot. This system controls the frictional heat developed in the

metering section of the screws. This is especially useful when processing RPVC.

The rear barrel section is divided in to two zones-barrel zone 1 and zone 2 and is

heated by ceramic heaters. The chute connecting the hopper feed unit to the

barrel is Water Cooled. Rear barrel section has a flanged end, which is bolted on

cradle. This section of barrel has an opening for venting out unwanted volatile

from the plastic melt through the openings provided in the barrel. The heating in

this section is done by ceramic heaters of zone 3. A blower is mounted on cover

of the heater, air is circulated on that particular zone, when temperature there in

overshoots above the set temperature.

Feed Unit: Feed of material from the hopper to the Extruder Barrel feed pocket is

controlled by the single-flight screw, driven by a sleeplessly variable speed DC

motor. The screw picks up material from the hopper and conveys it to the hopper

pocket. The screw speed is selected as per the processing requirements. The

screw speed can be increased or decreased in synchronization with main motor if

the extruder is running in AUTO mode.

Vacuum System: The barrel is provided with devoiatising system. Two holes are

provided on barrel one on each side to remove volatile gases. These two holes on

barrel are joined by common junction block having a hole at the side, which is

connected to vacuum pump via a filter. On top of this junction block two glass

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windows are provided to view the quality of plasticizing during processing. A

vacuum gauge is provided to check vacuum at the vent and a valve is provided to

adjust the vacuum as required. To enable cleaning of filter during processing

three gate valves are arranged in such a way that by operating them filter can be

opened, cleaned and fitted. It is advised that this filter to be cleaned to avoid the

filter getting chocked up.

Die:A typical die for pipe extrusion consists of an outer member comprising the

die ring/die body assembly, concentrically enclosing a mandrel (with a torpedo-

shaped end on the inlet side) supported in position buy three or more legs of a

spider. The internal annular gap between these two main components of the die

is the flow channel for the melt. Appropriately shaped and dimensioned, it tapers

conically towards the exit end, terminating in a parallel-sided annulus defined by

the mandrel body and the die ring: it is this annulus which determines the cross-

sectional dimensions of the tubular extrudate issuing from the die and hence to a

large extent also those of the finished pipe, although the annulus is normally

slightly oversized in relation to the pipe dimensions required, to allow for the

effects of draw-sown and of the sizing/cooling operation. At the spider, the die

channel is spanned radially, at intervals, by the spider legs. The reduction factor

in the cross-sectional area of the channel between the spider and the die orifice

(outlet), resulting from the conical taper, May-as a rough guide-is about 8: a high

degree of reduction is necessary to ensure that the melt is considerably

compressed, and thus enabled to knit thoroughly, after being divided by the

spider legs. To the same end, the legs should be kept to a minimum size

consistent with securing the necessary strength and rigidity of the mandrel

mounting, and hence of the whole die assembly, and should be suitably

streamlined. Failure of the melt to re-unite properly after passing round the spider

legs can result in the presence of weld lines in the pipe, which may become

failure sites under impact or pressure. Other considerations important in die

design include the following. The die geometry is responsible for a substantial

part of the backpressure generated in the extruder, and hence affects such

important process feature influenced by the backpressure as energy

consumption, extrusion rate, and the completeness of gelation of the PVC stock.

The constructional factors principally instrumental in the generation of pressure in

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the die are (a) the configuration and dimensions of the conically tapering section

of the channel and (b) the length and cross-sectional area of the annulus: this

length is usually referred to as the land length, and its ratio to the width of the

aperture as the land length ratio, values of 8-12 are fairly typical for land length

ratios of pipe extrusion dies. Obviously, the smaller the cross-section and the

greater the land length, the higher the pressure developed. The die design must

promote generation of backpressure at the appropriate level: sufficient to secure

the required throughput and good gelation of the stock, but not so high as to result

in excessive generation of frictional heat in the material or cause abnormal wear

of screw thrust bearings. In relation to the throughput aimed at, the die channel

volume and configuration must be such that the dwell time of the material in the

die is optimized to ensure that the homogenized melt is uniformly distributed in

the parallel-side annular gap which imparts its shape to the emergent pipe.

Sizing / Cooling Unit:

Technical Data:

Vacuum Sizing Unit:

Application: Vacuum sizing of PVC pipes

Range: Min. O.D. 16 mm, Max. O.D. 160 mm

Working center height: 1150 50 mm

Axial movement on rails: 1800 mm

Vacuum pump: 5 HP water ring vacuum pump

Pressure boosting: 7.5 HP Monoblock pump

Max Vacuum: 24(600 mm) of Hg.

Electricity Supply: 415V, 3 Phase, 50Hz

Water Supply: Flow rate = 17.8 LPS

Head pressure = 20 meter

Sizing (Calibration) Process: Sizing is an operation of cardinal importance in

pipe manufacture, in that it finalizes the bore, or the outside diameter, and

circularity of the pipe. It is performed n the hot tubular extrudate emerging from

the die orifice. The four main methods of calibrating uPVC pipe are as follows:

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Mandrel Sizing: An extended mandrel protrudes from the die and is cooled with

circulating water. This system yields pipes with very smooth, calibrated bore, but

can be troublesome to run and is less versatile than the other systems.

Pressure Sizing: In this system the tubular extrudate passes directly into a metal

tube (the sizing die or sleeve) having a bore equal to the OD required for the

finished pipe. Air pressure is applied through the mandrel via one of the spider

legs. The tube being extruded is sealed by means of a plug attached by a wire to

the mandrel, and an internal pressure is built up sufficient to keep the pipe

pressed against the metal tube (about 2lbf in-2). The tube is usually double-walled

and cooling water is passed through the cavity. Such sizing dies are usually quite

short (6-18 in) and the pipe being extruded passes directly from the die into a

cooling bath.

Vacuum tube Sizing: A similar arrangement to the pressure sizing die is used,

but in this method a vacuum is applied to the outside of the extruded hot pipe via

a number of small holes in the sizing tube. This obviates the need for a sealing

plug.

Vacuum ring and cooling tank: In this system the tubular extrudate is passed

through a vacuum ring (a short vacuum tube) which affects the initial sizing of the

pipe whilst cooling proceeds in a water bath kept under reduced pressure. The

atmospheric pressure inside the pipe maintains its circularity during its passage

through the bath. Modern vacuum sizing tanks can handle a range of pipe sixes,

up to about 900mm diameter.

Cooling Bath: High-velocity, finely atomized water sprays are used as the

cooling medium in modern practice. Flooded immersion water baths are suitable

only at very low take-off speeds otherwise inordinate bath lengths would be

necessary to achieve the requisite heat transfer. In some modern take-off trains

for the production of U-PVC guttering the extruded pipe can be slit longitudinally

and post-formed in the cooling tank, the two halves forming guttering profiles of

the desired shape.

Construction and Functional Details: DGP WINDSOR Vacuum Sizing Tank

Model VST-160/6V is a vacuum cum cooling spray bath suitable for pipes of

thermoplastic materials ranging from 16 mm dial to 160 mm dia. The machine is

simple and robust in construction and is placed on rails for mobility in the axial

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direction. Adjusting screws are provided for center height adjustment. The

machine is fitted with a 3.7 KW water ring vacuum pump for creation of vacuum,

and a 5.6KW monoblock water pump to supply water to the spray pipes for pipe

cooling. The tank is made with a 6 meters long vacuum chamber cum spray bath

in order to cool the pipe sufficiently to avoid variation in the pipe outside diameter

and ovality during traction, storage and subsequent handling. On the pipe entry

side, the tank has provision of mounting former boxes suitable for various pipe

diameters. The former box having slits at proper distance on its perimeter from

which vacuum is applied to the outside surface of pipe. The hot pipe coming from

the pipe die enters the former box and adheres to the internal surface of the

former box due to the presence of vacuum inside the tank. A water trough is

made in the vacuum chamber near former box. As the pipe passes through the

rough maintaining contact with the internal surface of former box, its outer skin

solidifies and takes the shape and size of former box. The cooling water sprays

directed on the pipe cools the complete cross section of the pipe subsequently. At

the exit end, pipe passes through a rubber ring held firmly between clamping ring

and supporting thus ensuring vacuum seal.

Haul-Off Unit: Technical Data:

Pipe range dia: 16 mm to 110 mm

Haul off speed: Refer speed chart.

Effective length of track: 650 mm

Center distance between: 1010 mm pulleys (drive & driven)

Height of pipes center: 1200 mm Max line (adjustable by hand) 1060 mm Min

Tracks: Rubber pads fixed on outside of endless Poly V belts

Drive to individual track: From common main drive shaft and bewel gears.

Drive: By A.C. Motor

Drive motor: A.C. Motor of 1.5 KW capacity Speed range 1500-3000 rpm

Connected load: Motor load: 1.5 KW, Supply: Single-phase 240V, AC 50 c/s

with earth.

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Speed Chart:

Range Motor Speed Sprocket Teeth Gear Box

Ratio

Haul off Speed

Mtrs. /minMotor Gear Box

1 1500

150

21 76 70 2.80

0.28

2 1500

150

21 33 70 6.43

0.64

3 1500

150

23 17 70 14.0

1.4

Tube Traction Process: The main function of this equipment are to pull the pipe

away from the die and through the sizing and cooling units at the required rate

and in such a way that it is kept straight during calibration and cooling; it also

feeds the cooled pipe forward to the marking and cutting sections of the line. The

haul-off is usually of the caterpillar or pneumatic-tyre type, employing these

elements to grip the pipe securely and impart the necessary traction. The haul-off

speed is normally set slightly in excess of extrusion speed, to achieve the

requisite degree of drawdown. As is largely self-evident, the wall thickness of the

pipe will decrease with increasing drawdown, whilst the uniformity of the take-off

rate is an important factor in wall thickness uniformity. For these reasons close

controllability and fine adjustment of haul-off speed are of cardinal importance in

the process.

Construction and Functional Details: DGP WINDSOR Tube Traction Unit

Model TTU-110 has been designed to meet the requirements of pipe haul off at

the required surface speed, matching with the extruder outputs obtained. The

machine is simple and robust in construction and is fitted with castor wheels andleveling bolts. The drive consists of a variable speed A.C motor, controlled by a

full wave Thyristor controller. A chain drive connects the motor to a robust worm

reduction gearbox, the output of which is given to the haul off tracks through a

rigid coupling and bevel gear drive. The Thyristor controller for A.C. motor is

housed in the base of the machine. As an optional feature the Potentiometer, for

the change of haul off speed of the traction unit, can be mounted separately on

the extruder base for the convenience of operation.

Cutting Unit:

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Technical Data:

Specifications:

Range of diameter: 16 mm to 110 mm

Max Extrusion speed: 10Mtr. / Min.

Cut length tolerance: about 4 to 5 mm

Max No. of cuts: 6 / Min.

Trolley stroke: 1100 mm

Saw blade dia: 350 mm

Saw motor: 1.5kW, AC, 3000RPM, 3 phases

Optional:

Swarf Collection Unit:

Blower Type: Centrifugal

Made: 28-160

Capacity: 600 CFM

Pressure: 6 WG

Speed: 2800RPM

Blower motor: 1.5kW, AC, 2880 rpm

Cutting Process: Pipes are usually cut by so-called flying saws. A flying saw is a

circular saw, which travels along with the pipe as it makes the cut. The saw is

generally activated by a limit switch touched off by the end of the pipe when a

desired length has passed under the saw position. On large pipes peripheral saws

are used, which do not cut right across the pipe but move around the

circumference, cutting through the well; such saws may be associated with a

chamfering device.

Construction and Functional Details: The tcu-110 (Tube Cutting Unit) is an

automatic machine for cutting the plastic pipes to required length, which can be

used for diameters from 16 to 110 mm. This machine has been so designed that it

can be installed as part of an extrusion line so that continuously extruded pipes

can be cut off to commercial lengths. The machine is available with a center

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height of 1150 50 mm. The pneumatic and electrical panel is located on the

base frame.

Trolley Assembly: The trolley assembly contains trolley plate, which is made out

of aluminum, on which clamp assembly and cutter assembly are mounted. Thetrolley plate is moving forward and backward on highly polished and hardened

guide rods with the help of 4 Nos. linear bush bearings. For forward and backward

movement of trolley, a pneumatic cylinder is provided and its speed can be

regulating with help of pressure regulator, which are mounted on panel. In

addition to control feed of trolley movement, 2 Nos. of F.C.V. are provided on

pneumatic cylinder. A pipe guide tray with guide rollers are provided to guide the

pipe up to fitting unit 2 Nos. guide blocks are mounted on trolley plate which guide

the pipe before entering into the clamping assembly. The gaps between the guide

blocks are to be adjusted according to pipe sixes.

Clamp Assembly: Clamp assembly contains very few parts like aluminum

casting cover with lifting handle and two Nos. cylinder mounting adjustable

brackets. 2 Nos. cylinders are pressed the pipe on the trolley top plate with the

help of rubber pad. According to pipe wall thickness clamping pressure can be

regulate. Many types of clamps are used in clamping unit. Traditional clamps,

Universal clamps, 3-arm universal clamps.

Cutter Assembly: Cutter Assembly is mounted under top trolley plate. It contain

cutter motor, saw blade, cutter cylinder etc, motor and cutter are mounted on

motor plate which can be move up and down with the help of pneumatic cylinder.

Two Nos. of adjustable limit switch are mounted on slotted plate and they are

adjusted as per pipe size requirement. Outward stroke is restricted by limit switch

and stopper bolt. Many types of cutter are used as saw in following fig.

Swarf Collection: This assembly is an optional feature of this unit. This assembly

contains blower, hose, and swarf collection unit and air filter. A swarf collection

unit is joined to cutter protecting hood with the help of flexible duct. A blower

sucks the valuable swarf from clamp assembly through cutter protecting hood,

which is collected in swarf can be removed at regular interval from swarf

collection unit through manhole.

Pipe Tilting Unit:

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Construction and Functional Details: The pipe-tilting unit receives cut pipe

pieces from the Auto Saw and stacks them in a collection rack. The tilting

operation can be matched to the extrusion speed and the cut length of a pipe so

that in conjunction with the Auto Saw, cutting and stacking operations follow each

other automatically in a cycle.

Technical Data:

Range of pipe diameter: 16 mm to 110 mm

Tray Length: 6000 mm

Tilting stroke/Min: 10

Center height of extrusion: 1150 50 mmOperation sequence: The pipe coming from the Auto Saw moves in the tray.

The front tip of the forward moving pipe presses the limit switch LS-1, which gives

signal to Auto Saw motor for start of the cutting cycle. As the cutting of the pipe

takes place, the Timer on the Auto Saw / Tilting unit receives Start signal. The

timer period is to be set in such a way that the cut pipe piece can drop in the

collection rack, when it is titled off from the tray. The timer period has to be

adjusted to suit speed and cut length of pipe. The second timer (RTPN) provided

on the Auto Saw / Tilting Unit acts as a delay timer. After tilting of the tray, the

same should not return to its normal position unless pipe has dropped down. This

holding time is to be set on the delay timer.

Precautions: The pipe leaving the Auto Saw should enter the tray of Tilting Unit

without getting deflected in any way. This means that the tray alignment and the

tray height with respect to Auto Saw are to be maintained. The limit switch LS-1

with flap type lever is to be adjusted according to the pipe diameter in such a way

that on-moving pipe grazes along the lever and operates the switch. While

adjusting the tray height according to pipe diameter, care should be taken to

retain the tray. Horizontal and Symmetrical with respect to the plumb line.

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Objectives and Strategies

In introducing its new plumbing pipes to the local market, Hero Agro has set its

objective at capturing a 5% local market share in 12 months following the

product's roll-out. Further, it seeks to expand its local market share for U-PVC

pipes from 5% to 7% as a result of the increased production capacity and

aggressive marketing strategy associated with its expansion. In the longer term,

the company will seek to capture 1% of the national market for each of its

products by within the next 5 years.

These objectives will be pursued through an aggressive pull strategy of

advertising and promotions aimed at end-users of the Hero Agro s products. This

approach is designed to stimulate demand at the retail level by promoting the

products to consumers who will then seek to find the pipes on the shelves of the

local retail stores. This strategy will be supplemented with direct sales push aimed

specifically at purchasing agents of chain discount stores, with a secondary target

of purchasing agents for local and regional markets and retail stores. This push

strategy is intended to communicate a specific message about the Hero Agro

products -- which the products will appeal to consumers more readily than

products perceived as generic. A secondary message aimed at retailers will

emphasize that their product will be delivered more quickly and more reliably than

those of major corporations

The products will be marketed as low-cost alternatives to the expensive off-the-

shelf products sold by the big three major plastic companies. Since many of the

potential retailers being targeted are already familiar with these products, Hero

Agro will emphasize the unique selling features of its products.

Finally, Hero Agro plans to use its growing customer base in the first two years to

slowly expand its market concentration into other regions of the country. As the

company grows and the marketing budget increases, Hero Agro will slowly

capitalize on its brand recognition in it regional base in order to increase

marketing and promotions activities in other regions.

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Unique Selling Advantage

The unique selling advantage of Hero Agro is its ability to induce both price-

sensitive and value-oriented consumers to purchase its products through clever

promotions and packaging. Hero Agro hopes to use its expansion as a

mechanism to amplify these advantages substantially.

While other companies are involved in the value plastic business, Hero Agro

believes those companies have taken an improper approach to pac

Date post:	06-Apr-2018
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Hero Agro Project Report-Prince Dudhatra

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