Smart plastics pvt. ltd. By Mayank Patel

Smart Plastics Pvt. Ltd.

1

I undersigned Mr. Mayank R. Gol the student of T.Y. B.B.A..

Here, I declare that presented project repot work on Smart Plastics Pvt. Ltd. (Rajkot) is my own work under the guidance of prof. Dinaben Kanani.

This has not been submitted to any other university for an examination.

Date :~ Mayank R.Gol

Signature of In charge

Declaration

Preface


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In the B.B.A. Field, only the theoretical knowledge of business is not enough for achieving all over knowledge of business Management.Practical training is also important in all aspects of human life. Keeping this in mind, Saurashtra University has included the subject of practical studies or Industrial Training in B.B.A. of some favourable days in every year of B.B.A.

I had attended on Industrial training at Smart plastics Pvt. Ltd. (Rajkot). It is well known Gear manufacturing unit using advanced technology & equipment. The report submitted here, provides all information that I have obtained in my practical training at Smart Plastics Pvt. Ltd..



Acknowledgement


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It quite delighting for me to get admission in course of business administration which is most valuable in commerce field. This is great opportunity for me to present my third project report of the industrial unit that I have visited.

I am very grateful to our prof.Dinaben Kanani for their sincere attention valuable guidance and providing suggestion & guiding me to prepare this report.

I am also thankful to Mr. Mayank gol for providing me the permission to visit this unit. I am also thankful to Mr. Hardik Boghara for sparing their valuable time inspire of their busy schedule and helping me to collect all such information.




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Sr. no. Contents

Page no.

01. General Aspects 08

Introduction 09

Portfolio of the Firm 10

Mission, Vision & Values 12

Profile of the Partners 13

Basis and Presumptions 15

Organisational Structure 16

Implementation Schedules 17

Location Justification 18

2. Technical Apects 20

Product Detail 21

Types of the Product 21

Usage & Features of the Product 24

Production Capacity Schedule 25

Main Index


5

Details of Raw Material and Suppliers 26

Details of the Machineries 27

Production Process 28

Quality Justification 29

Pollution Control 30

Energy Conservation 30

Staff & Labour Details 31

3. Marketing Aspects 32

Marketing 33

Marketing Research 33

Market Potentiality 34

Promotional Activities 34

Distribution Channel 35

Demand Analysis 36

Pricing Decision 36


6

4. Financial Aspects 37

Fixed Capital Detail 38

Working Capital 40

Total Capital Investment 42

Sources of Finance 42

Depreciation 43

Sales Forecast 43

Fixed & Variable Cost Schedule 44

Projected Cost Sheet 46

Projected Financial Accounts (80%) 49



Schedules For Overheads 58


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5. Financial Analysis 62

Cost of Production 63

Turnover 64

Profitability Analysis 65

BEP Analysis 67

Risk Factors 69

Raw Material Suppliers 70

Machinery Suppliers 71

6. Future Prospectus 72

7. Conclusion 74

8. Bibliography 76

GeneralAspects


8

Introduction


9

Small scale industry is the pillar of Indian economy. Most of

the business carried out in India are small scale units. Small scale

units provides raw materials to large scale units and be partners of

their success. The number of small scale units, the volume and

range of products manufactured the employment provide and value

of exports by these industries have grown substantially during the

last decade.

This report is on “Plastic Bottles” and the product is very

much known to the people. Plastic industries are one of the up

coming industries now a days. So, demand for plastic products for

various uses is increasing day by day. Plastic is mostly used as

packing material for industries and storing material for stores and

house plastic bottles are one of the most common storing and

packing containers.

Portfolio Of The Firm


10

Name of the Unit “Smart Plastics Pvt. Ltd.”

Form of the Unit Partnership Firm

Size of the Unit Small Scale Industry

SSI Registration No. Applied For Registration

Products Name Plastic Bottles

Brand Name$m@rT®

Name of the Promoters Mayank R. GolKaushal G. DhadukMohit N. BhagdevHardik J. Boghara

Factory Location Plot no. 901, Phase – I I ,G.I.D.C. Metoda, Lodhika,Dist. Rajkot

Registered Office 105, Ground Floor,King’s Plaza,Astron Chowk,Rajkot-360002.

Bankers Jeevan Commercial BankICICI bankIDBI BankGSFC

Establishment Year 2011

Phone Number/ Fax No. (0281) 2901553/2901554


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Web Site www.smartproducts.com

E-mail Id [email protected]

Number of Employees 80

Cost of the Project 10’264’500

Production Capacity As per Product

Contribution in Finance 80 % Owned Capital20 % Borrowed Capital

Our Vision

Mission, Vision & Values


12

‘The most successful and admired Plastic Product company, which means that we are the most trusted & qualitative company, the easiest to deal with, offer the best value for money, and set the standards in the industry’.

‘The most obvious choice for all’.

Our Values

‘The values that we observed while we work’.

Integrity Innovation Customer Centric People care “One for all and all for one” Team work Joy & Simplicity

Our Mission

We, at plastic industries want to provide customers both in rural areas as well as urban areas high quality branded products. We, by producing Smart Plastic Products, want to help in a small way to rural community in solving their liquid keeping problems.

We are in the business of plastic industries world. We have a mission to accomplish the following objectives:

Accelerate the growth of rural & urban market for our plastic products.

Strengthen our positioning Gujarat market

Rapidly popularizing our products across India.

Partner 1

Profile Of The


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Name of the Partner Mayank Gol

Address “Lekh”,7,Krishna Plot,Near the Shishu Mandir,Derdi (Kumbhaji)-364465,Dist. Rajkot.

Educational Qualification I.C.W.A., I.C.F.A., MBA.

Designation in Unit Founder & OwnerFinance & Cost Department

Financial Contribution 40 %

Share in Profit 40 %

Partner 2

Name of the Partner Kaushal Dhaduk

Address “Satyam”8, Vishweshwar,Movdi Chowkdi,Rajkot-360006.

Educational Qualification Diploma in HRM, B.E.(Chemical).

Designation in Unit HR & Technical Department



Partner 3


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Name of the Partner Mohit Bhagdev

Address “Jalaram Krupa”,16, Laxmi Vadi,Rajkot-360004.

Educational Qualification Ph.D.(Whole Marketing Elements).

Designation in Unit Marketing & Mfg. Department



Partner 4

Name of the Partner Hardik Boghara

Address “Waqt”2,Gulab Nagar,Master Society Main Road,Rajkot-360002.

Educational Qualification C.A., UPSC, PGDEM.

Designation in Unit Accounting & Export Department



Basis & Presumptions


15

The unit will work for 300 working days in a year on single shift

basis.

The salaries & wages, cost of land and building and Raw-Material

cost have been taken according to prevailing market rates.

Time period for achieving full envisaged capacity utilization is 2

years.

The salaries & wages will be given on monthly.

The cost in respect of machinery and equipment, raw-materials and

the selling price of the finished product etc are those generally

prevailing at the time of preparation of the project report.


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ORGANIZATION STRUCTURE

Organisational Structure

Managing

Director

HR Manager Production Manager

Sales Manager

Finance Manager

Assistant Designer Assistant Accountant

Workers Typist

Skilled Unskilled


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The major activities in the implementation of the project

has been listed here,

1. Preparation of project report selection of site & S.S.I registration etc

04 Months

2. Procurement of finance loan construction of factory shed machinery procurements, erection and commissioning trials runs & recruitment of staff & labours permanent registration etc.

10 Months

3. Machinery procurement 04 Months

Total Time Period 1 year & 6 months

Schedules


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JUSTIFICATION OF LOCATION

To select the location is one of the very important & crucial decisions for any organization. A good location may reduce the cost of production & distribution to considerable extend. While selecting a site, it is necessary to consider technical, commercial and financial aspects and then select a site that may provide maximum advantages.

We have selected GIDC Metoda while keeping in mind the following facilities:

Facility of transportation Smart availability of raw materials Cheap labour Market Availability of power supply Finance facilities Water facility Govt. Facility

TRANSPORTATION

The purposed factory will be at Metoda, Rajkot well connected by three modes

of transportation, Railway, Roadway & Airway. The factory site is in proximity with the

Rajkot Railway Junction , Domestic Airport and the national highway – 8B and the state

highway Rajkot-Kandla.

The nearest international city is Mumbai 45 minutes flying time and the nearest

major port is Kandala 200 km. by road. So all kind of transporting vehicle, truck, train,

ship, plane etc are available not too far from the site and hence our location in respect

of to transport availability for the product concerned is the most suitable one.

Location Justification


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AVAILABILITY OF RAW MATERIAL

Mainly for our product bottles is needed other raw materials which are in

detail given later in this report. All those raw materials are available at Ahmedabad,

Viramgam, Raipur, Bhila etc.

MAN POWER

All manufacturing concern small or big always depends on available man power

skilled, unskilled, and semiskilled. We have also given a thought to this matter and

found that ours is an area cheep labour is easily available in our project.

MARKET

All products manufacturers always think about market of this product. Our

nearest and main markets are, Ahmedabad, Rajkot, Jamnagar, Mahesana etc.

WATER FACILITIES

Water is not required for product purpose. It is required only for domestic

purpose. Arrangement will be made at the site by installing tube well.

SOURCES OF FINANCE

Finance is oxygen or blood for the industry and thus the procurement of

finance is very vital. The various financial industries like the nationalized banks,

commercial banks, GSFC branch are located in Rajkot city near to the site of the factory.

Technical

Aspects


20

Product Details


21

The unit will produce only 1 litre plastic bottles for the time being.

There bottles will be available with sealing caps without printing of any

kind words & figures. Plastic granules are the main raw material for this

product and we can get this raw material very easily from the market .

Types Of The Products


22


23

Usage & Features Of The Product

This product will be used as a packing material for many industries

like every food products which are in liquid form for packaged drinking

water industry for oil industry, chemical industry, pharmaceutical industry

& other ailed product industries.

Now a days people prefer more plastic items than glass items. So

plastic bottles are regularly used for house hold purpose and many other

producers who are selling their product in liquid form for them plastic

bottles are pre- requirement. Example is that every people purchase

sharbat bottles for their routine use.

There are certain features of this product which are as under.

It is not a costly product and afford by every people

It is in less weight so it is very Smart to movement.

This product doesn’t need a much care because this product is

not easily broken or damaged.

We can store a plastic bottle in any place.

These plastic bottles are very useful to other industries for

Packing materials.


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Installed capacity 1012500

Utilized capacity 813000

Daily production 2710

Weekly production 16260

Monthly production 67750

Monthly sales 677500

Yearly sales 8130000

No of working days 25 in a month

No of working days 300 days in a year

Production Capacity Schedule


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RAW MATERIALS & SUPPLIERS

Raw material is the basic and main requirement for producing any

product for our industry we need plastic granules as a raw materials.

Two companies are selling plastic granules of different grades.

According to their grades their prices are changed and for a different

plastic items different grade of plastic granules are used.

Main Two companies are selling plastic granules

(i) Reliance

(ii) IPCL

Smart plastic will purchase plastic granules from Reliance Industries.

Grade of Plastic Granules – GPBN 52GB003

Details Of Raw Materials


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MACHINERY & EQUIPMENTS

Machinery is such a thing through which Raw material are

converted into finished product.

“Smart Plastic” or this unit will use following machineries in

their production.

(1) Cooling tower

This machine is used for cooling plastic after jinning plastic

stones which are in liquid mode.

(2) Air compressor

This machine is used for giving specific shape by creating

bottles.

(3) Scrap Grinder

This machine is used for removing scrap to give perfect size

to the product.

(4) Thermoplastic Injector Molding Machine

This machine is used for checking all bottles whether

anyone is lickage or defective pieces.

Details Of Machineries


27

Production Process Chart

Production Process

Heating Stones in cylinder Cooling of Plastic Liquid

Mixing Of ColoursProviding Shape

Removing Scrap Final Product

Quality Test


28

QUALITY SPECIFICATION

According to C.D. Lewis, Quality is,” An asset which may be offered to the potential customers of a product or services.”

It is the totality of features and characteristics of a product that bear an ability to satisfy a given need. It makes a product fit for the use of customers. This fitness is related to benefits derived by the customers and customer satisfaction.

For Plastic Products, the quality of a product depends upon strict supervision and use of correct material according to the specification. In the construction care should be taken while roughening the upper. If they over roughed, the fibers will be weakened. The adhesive should be properly applied to obtain permanent bond.

Quality


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Pollution Control

At the time of conversion of inputs into outputs, some waste is inevitable. This wastage and spoilage create some pollution which harms the environment. This pollution can be controlled if various steps are taken into consideration.

As far as Smart Plastics pvt. Ltd. is concern, this industry will not generate any type of pollution.

Energy Conservation

Energy is the basic requirement for any manufacturing process. Energy can be in the form of fuel as well as power. It is necessary to utilize optimum energy to reduce the cost and achieve maximum production.

Energy conservation in this type in unit is much on the lower side since low powered motors are used in the production activity. The staff of the unit should be made aware of the need to conserve energy by switching off energy sources when not required.

Pollution Control

Energy


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General Manager 01

Production Manager 01

Marketing and Sales Manager 01

Finance Manager 01

Skilled Workers 35

Semi-Skilled Workers 15

Unskilled Workers 10

Fitter For Maintenance 01

Supervisor 03

Receptionist 01

Store Keeper 01

Watchman 03

Foreman 02

Peon 05

Total 80

Staff & Labour Details

Marketing

Aspects


31


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MARKETING

What is marketing?

“Marketing is the process that facilitates an exchange of goods for money to the mutual satisfaction of both the producer and the consumer.”

What is a sale?

“A sale is an exchange of goods for money. It is the end point of the marketing effort.”

In the global world of present times when competition can come from any part of the world, it becomes essential to take a marketing approach where the customer is treated as a KING.

The marketing philosophy places the customers at the centre of all business considerations.

MARKET RESEARCH

“Marketing research has to do with the gathering, processing, analysis, storage and dissemination of information to facilitate and improve decision making.”

Market research is a very important tool for an organization. It fills the gap between the development of a product and its ultimate sales to the consumer.

Market research enables the entrepreneur to plan, to organize, to stimulate, to co-ordinate and to control production, finance, sales, advertising and profits. It has become a key resource to accomplish two objectives of customer satisfaction and profitability.

Smart Plastics has also done market research and in future also it needs to conduct it to keeps the firm in touch with the market and to survive in cut-throat competition.

Marketing Exercises


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MARKET POTENTIALITY

Market potential is the scope of the product occupying space existing market. It represents an anticipated level of demand and it also reflects on the pattern of the demand. The aspects which are covered under market potential are customers, market share, contribution in the market already existing and many more.

As the population of the country is ever going up, resulting in higher and higher demands of the consumer item. Thus, in view of both national requirement and vast export potential, there is immense scope for further promotion of this industry in the country.

Thus, potentiality of children Bottles in the market is very strong.

PROMOTIONAL ACTIVITIES

Promotional activities are those activities which make efforts to promote the product and help to increase the market share. Advertisement is done through various medium as a promotional tool in this firm.

Promotion can be defined as,” the co-ordinated efforts to establish channels of information and persuasion to facilitate or foster the sale of goods or services, or the acceptance of ideas or points of view”.

Smart Plastics gives advertisement in:-

news papers

television

magazines

on radio and

even through personal selling


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DISTRIBUTION CHANNEL

“The channels of distribution are the set of marketing institutions participating in the marketing activities involved in the movement or the flow of goods or service from the primary producer to the ultimate consumers.”

Channels of distribution are best understood as alliances of various marketing institution performing specific marketing functions. The channel of distribution includes the original producer the final buyer and any middleman either wholesaler or retailer is

component are linked in the channel system by one or more marketing flows. In order to bring the goods from the place of manufacturer to the place of the consumer, the goods have to follow a path or route, which is known as ‘Channel of distribution’ or ‘Trade channel’ which are as follows:

Manufacturer

Retailer

Consumer

Smart Plastics follow the above channel of distribution.


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Demand Analysis

Success of any organization depends upon the demand of the

product of that organization. Without knowing about the demand of any

product if you are produce that product than it may happen that you will

have to suffer a loss. This unit is going to produce 1 litter plastic bottles.

The demand for any plastic items is increasing rapidly. Demand for the

packaged drinking water chemicals, drugs, pharmacy product, every food

product which are in liquid form, kitchen wear, etc are also increasing due

to increase in production and so for packing all these products plastic

bottles are required.

The unit will get a direct purchaser for their product i.e.

manufacturer of all food products, oil millers, pharmacy company, chemical

companies etc gave assurance to purchase plastic bottles and we all know

that future of plastic containers is very bright so we can say that this unit

will definitely achieve the projected target.

Pricing Decision

This firm is going to product 1 liter plastic bottles, so to decide a

proper pricing policy for this product is very necessary. Pricing is an

important decision that every company has to high price or low price may

create a bad reputation of the firm the price of a product is crucial

decision.

“Smart plastic” i.e. our firm will adopt cost plus pricing policy for

their product .

Financial

Aspects


36

Total Fixed Assets


37

A) Plant and Machinery

SI.No. Description Imp / Ind

Qty Value (Rs.)

01. Hydraulic Sewing Arm Upper Clicking Machine

Ind 1 112’500

02. Upper Skiving M/c Ind 1 82’50003. Punching & Eyeleting M/c (Treadle

Operated)Ind 1 15’000

04. Upper Folding M/c Imp 1 127’50005. Stamping M/c for Upper & Lining Ind 1 22’50006. Flat bed sewing machine (Power

operated)Ind 4 72’000

07. Post bed single needle machine (Power)

Imp 2 225’000

08. Cylinder bed sewing machine Imp 2 240’00009. Zig Zag Sewing Machine (Power) Imp 1 120’00010. Toe lasting machine Imp 1 1’200’00011. Seat lasting machine Imp 1 1’200’00012. Double ended buffing and brushing

machineInd 1 37’500

13. Injection Moulding Machine (fully automatic)

Imp 1 1’500’000

14. Cost of moulds --- - 225’00015. Spare parts for imported machinery

@ 10%Imp - 461’250

16. Wooden lasts @ 250 per pair for 400 pairs

Ind - 180’000

17. Tools and equipment, dies for upper Ind - 90’00018. Office equipment and furniture Ind - 75’00019 Electrification and installation

charges @ 10% of the cost of machinery

--- - 495’450

Total --- - 6’481’200 Say 6’481’000


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B) Land & Building

PARTICULARS YARD RATE AMOUNT

Land 400 sq 5’00 2’000’000

Building 2’500sq 400 1’000’000

Total 3’000’000

C) Other fixed assets:-

Pre-operative expenses 73’500

WORKING CAPITAL


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A). Salary and Wages

SI.No. Personnel No. Salary (Rs.) Amount (Rs.)

01. Manager (Production) 01 22’500 22’500

02. Manager (Sales) 01 22’500 22’500

03. Designer 01 127’500 127’500

04. Supervisor 02 15’000 30’000

05. Skilled Worker/Machine Operator

20 7’500 1,00,000

06. Unskilled Worker 10 4’500 45’00007. Accountant 01 6’750 6’75008. Clerk cum Typist 01 6’000 6’000

09. Storekeeper 01 6’000 6’000

10. Peon cum Chawkidar 01 4’500 4’500

11. Sweeper 01 3’000 3’000

Total 3,09,000

B) Utilities (Per Month):-

SI.No. Description Qty. Value (Rs.)

01. Power – 20 HP 6’000 units 30’000

02. Domestic light 600 units 12’000

03. Water Charges 3’000

Total 45’000

C).Raw Material


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SI.No. Description Qty. Rate (Rs.) Value (Rs.)

01. FC Upper 168’750 dcm 20/dcm 3’375’000

02. Softy lining 93’750 dcm 50/dcm 4’687’500

03. Leather Board 9’375 pairs 60/pair 562’500

04. Canvass 1’200 mtrs 50/mtr 60’000

05. PVC Materials (Black/Colour)

9’375 Pairs 85/pair 796’875

06. Adhesive & grinderies 9’375 pairs 35/pair 328’125

07. Packing materials 10’000 Pairs 10/pair 100’000

Total 9’910’000

D) Other contingent expenses (PER MONTH)

SI.No.

Item Amount (Rs.)

01. Rent 15’00002. Postage and Stationery 15’00003. Repairs and Maintenance 15’00004. Storage Expenses 3’00005. Transport Charges 7’50006. Advertisement and Publicity 12’00007. Taxes 6’00008. Insurance 15’00009. Sale Expenses 15’00010. Misc.Expenses 9’000

Total 112’500

TOTAL CAPITAL INVESTMENT


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1). Fixed capital Rs. 6’555’000

2). Working capital Rs. 5’509’500

TOTAL CAPITAL INVESTMENT Rs. 12’064’500

In this firm, finance will be generated 80% from owned capital and 20% from borrowed capital.

Owned capital Rs. 8’211’600

Borrowed capital Rs. 2’052’900

TOTAL Rs. 10’264’500

Contribution of owned capital between different partners can be divided into the ratio of 40%, 20%,20% and 20% as……

1). MAYANK GOL (40%) Rs 3’284’640

2). KAUSHAL DHADUK (20%) Rs. 1’642’320

3). MOHIT BHAGDEV (20%) Rs. 1’642’320

4). HARDIK BOGHARA (20%) Rs. 1’642’320

SOURCES OF FINANCE

DEPRECIATION


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NO PARTICULARS RATE 1STYEAR 2ND YEAR 3RD YEAR

01. Machinary 10% 240’000 270’000 300’000

02. Furniture 10% 9’600 10’800 12’000

03. Wooden last 12.5% 13’500 15’130 16’875Total 263’100 295’930 328’875

Year Utilized capacity Production Sales SellingPrice

Amount

1st 70.00% 90’000 90’000 113 10’170’000

2nd 78.75% 101’250 101’250 113 11’441’250

3rd 87.50% 112’500 112’500 113 12’712’500

Fixed cost

SALES FORECAST

FIXED AND VARIABLE COST SCHEDULE


43

No Particular Amount

1 Depreciation 564’450

3 Interest on total investment 1’810’800

4 Salaries 126’000

5 Other expenses 216’000

6 Rent for one year 180’000

7 Insurance 54’000

TOTAL 2’951’250

FCPU = Total Fixed cost

Units. Sold

= 2’951’250/90’000

= 32.79

Variable cost


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No Particular Amount

1 Raw-material 5’085’000

2 Other Contingent Expenses 1’350’000

3 Utilities 540’000

4 Other material 495’000

5 Staff & Labour 369’000

TOTAL 7’839’000

VCPU = Total Variable Cost

Units. Sold

= 7’839’000/90’000

= Rs.87.1


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Particulars 2011-12 2012-13 2013-14

*PRIME COST

Opening Stock Of Raw-material

- - -

Add: Purchase 4’068’000 4’576’500 5’085’000

Less: Closing Stock Of Raw-Material

- - -

RAW-MATERIAL COST 4’068’000 4’576’500 5’085’000

Direct Wages 162’600 181’925 203’250

Power – 20 HP 288’000 324’000 360’000

Domestic light 115’200 129’600 144’000

Water Charges 28’800 32’400 36’000

PRIME COST 4’662’600 5’244’425 5’828’250

PROJECTED COST SHEET


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*FACTORY OVERHEADS

Storage Expenses 28’800 32’400 36’000

Repairs and Maintenance 144’000 162’000 180’000

DEPRICIATION ON:

Machinery 240’000 270’000 300’000

Furniture, Tools & Equipment

9’600 10’800 12’000

Wooden lasts 13’500 15’185 16’875

TOTAL FACTORY OVERHEADS

435’900 490’385 544’875

*OFFICE EXPENSES

Rent 144’000 162’000 180’000

Salary 51’000 57’375 63’750

Postage and Stationery 144’000 162’000 180’000

Taxes 57’600 64’800 72’000


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Insurance 144’000 162’000 180’000

Misc.Expenses 86’400 97’200 108'000

TOTAL OFFICE EXEPENSES 627’000 705’375 783’750

*SELLING & DISTRIBUTION OVERHEADS

Transport Charges 72’000 81’000 90’000

Advertisement and Publicity 115’200 129’600 144’000

Sale Expenses 144’000 162’000 180’000

TOTAL SELLING & DISTRIBUTION OVERHEADS

331’200 372’600 414’000

TOTAL COST 6’056’700 6’812’785 7’570’875


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Trading A/c of SMART INDUSTRY for the year 2011-12

Particulars Amt. Particulars Amt.

Opening balance ------- Sales 10’131’600

Purchase of R.M. 4’068’000 Closing balance 240’000

Wages 213’600

Power- 20HP 288’000

Domestic Light 115’200

Water Charges 28’800

Gross Profit 5’658’000

10’371’600 10’371’600

PROJECTED FINANCIAL ACCOUNT (70%)


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Projected Profit & Loss A/c of SMART PLASTICS for the year 2011-12


Salary 213’600 Gross Profit 5’658’000

Rent 144’000 Interest on investment 1’448’640

Postage & Stationery 144’000

Repair & Maintenance 144’000

Storage Expense 28’800

Advertisement 115’200

Sales Expense 144’000

Misc. Expense 86’400

Depreciation 120’480

Bank Interest 347’457

Interest on partner’s capital 675’612

Insurance 144’000

Transport Charges 72’000

Taxes 57’600

Net Profit 4’669’491

7’106’640 7’106’640


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Balance Sheet of SMART PLASTICS for the year 2011-12

Liabilities Amt. Assets Amt.

Capital: Fixed Assets:

Mayank Gol 3’284’640 Land and building 3’000’000

Kaushal Dhaduk 1’642’320 Machinery 2’400’000

Mohit Bhagdev 1’642’320 Furniture 96’000

Hardik Boghara 1’642’320 Wooden Last 108’000

Storage Facility 720’000

Net profit 4’669’491 Other 348’000

Investment 1’200’000

Current Liabilities: Current Assets:

12% Loan 240’000 Debtors 3’229’491

Cash 720’000

Bank 3’306’231

Bills Receivable 453’369

Closing stock 240’000

13’121’091 13’121’091


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Trading A/c of SMART PLASTICS for the year 2012-13


Opening balance 240’000 Sales 11’398’050


Wages 240’300

Power- 20HP 324’000




11’681’550 11’681’550

PROJECTED FINANCIAL ACCOUNT (78.75%)


52

Profit & Loss A/c of SMART PLASTICS for the year 2012-13


Salary 240’300 Gross Profit 612’5250










Interest on partner’s capital

760’063

Insurance 162’000


Taxes 64’800


7’754’970 7’754’970


53




Mayank Gol 2’305’940 Machinery 2’700’000

Kaushal Dhaduk 1’152’970 Furniture 108’000

Mohit Bhagdev 1’152’970 Wooden Last 121’500

Hardik Boghara 1’152’970 Storage Facility 810’000

Net profit 5’013’177 Other 54’007



12% Loan 350’030 Debtors 675’000

Cash 810’000

Bank 3’719’510


Closing stock 270’000

11’128’057 11’128’057


54

Trading A/c of SMART PLASTICS for the year 2013-14


Opening balance 270’000 Sales 12’664’500


Wages 267’000

Power- 20HP 360’000




12’964’500 12’964’500

PROJECTED FINANCIAL ACCOUNT (87.50%)


55

Profit & Loss A/c of SMART PLASTICS for the year 2013-14


Salary 267’000 Gross Profit 6’802’500










Interest on partner’s capital

844’515

Insurance 180’000


Taxes 72’000


8’613’300 8’613’300


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Mayank Gol 4’105’800 Land and building 3’750’000

Kaushal Dhaduk 2’052’900 Machinery 3’000’000

Mohit Bhagdev 2’052’900 Furniture 120’000

Hardik Boghara 2’052’900 Wooden Last 135’000

Net profit 5’566’863 Storage Facility 900’000



12% Loan 300’000 Debtors 1’171’863

Cash 975’000

Bank 4’132’788


Closing balance 300’000

16’131’363 16’131’363


57

SCHEDULE FOR WRITTEN DOWN VALUE OF FIXED ASSETS

Particular Rate Net Block

Year 1 Year 2 Year 3

Land Building Machinery Furniture & FixtureElectrification Installation ChargesTelephone Computer Trolley & other equipments

-10%15%10%

10%10%60%

10%

50,00,00067,50,00011,39,000

1,80,000

4,50,0009,000

24,000 13,500

50,00,00060,75,000

9,68,1501,62,000

4,05,0008,1009,600

12,150

50,00,00054,67,500

8,22,9271,45,800

3,64,5007,2903,840

10,935

Schedules For Overheads


58

S C H E D U L E F O R F A C T O R Y O V E R H E A D S

Particular Year 1 Year 2 Year 3

Repairs WagesDepreciation on MachineryDepreciation on BuildingInsuranceFuel

Total

80,0007,95,6002,01,000

7,50,000

15,00036,000

80,0007,95,6001,70,850

6,75,000

15,00036,000

80,0007,95,6001,45,223

6,07,500

15,00036,000

18,77,000 17,72,450 16,79,323

S C H E D U L E F O R A D M I N I S T R A T I V E O V E R H E A D S


59


SalaryPostage & TelegramTelephoneMiscellaneous Exp.Insurance ExpensesMedical ExpensesProfessional TaxLegal ExpensesAudit FeesDepreciation Interest on Owned CapitalElectricity

Total

2,96,300

22,00032,00044,00075,00046,500

1,80024,00035,500

1,08,500

9,55,50036,000

2,96,300

22,00032,00044,00075,00046,500

1,80024,00035,50079,650

9,55,50036,000

2,96,300

22,00032,00044,00075,00046,500

1,80024,00035,50064,485

9,55,50036,000

17,40,400 17,11,550 16,96,385


60

S C H E D U L E F O R S E L L I N G O V E R H E A D S


Advertising Exp.Traveling Exp.

Total

62,00063,000

62,00063,000

62,00063,000

1,25,000 1,25,000 1,25,000

Financial

Analysis


61

Cost of Production


62

No. Particular Amount

1 Total recurring cost per year 7’068’000

2 Depreciation on machinery @ 10% 300’000

3 Depreciation on furniture, tools & equipment @10% 12’000

4 Depreciation on wooden last @ 12.5% 16’875

5 Interest on total investment @ 15% 1’810’800

TOTAL 9’207’675

Turnover


63

Sales Selling price Amount

112’500 113 12’712’500

At 70% utilization

Quantity: 90’000 Pairs In Value: Rs. 10’170’000/-

At 78.75% utilization

Quantity: 101’250Pairs In Value: Rs.11’441’250 /-

At 87.50% utilization

Quantity: 112’500 Pairs In Value: Rs. 12’712’500 /-

Profitability Analysis


64

1).PROFIT:-

Annual turnover Rs. 12’664’500

Less: Cost of production Rs. 9’247’800

PROFIT Rs. 3’416’700

2).PROFIT AFTER TAX:-

Profit Rs. 3’416’700

Less: Tax (50%) Rs. 1’708’350

NET PROFIT Rs. 1’708’350


65

3). RATE OF RETURN:-

Rate of Return = Net profit X 100

Total capital investment

= 1’708’350 X 100

3’072’000

= 55.61%

4). NET PROFIT RATIO:-

Net Profit Ratio = Net profit X 100

Sales

= 1’708’350 X 100

12’664’500

= 13.49%

BEP Analysis


66

Particulars Amount Sales (113 * 112’500) 12’712’500Less : Variable Cost 7’839’000

Contribution 4’873’500

Less : Fixed Cost 2’951’250

Profit 1’922’250

B.E.P. ( IN UNITS ) :

= Total Fixed cost

Contribution per unit

= 2’951’250

43.32

= 68’126 units


67

P.V. Ratio = Contribution X 100

Sales

= 4’873’500

12’712’500

= 38.34%

B.E.P. (in Rs.) = Total Fixed cost

P.V. Ratio

= 2’951’250

38.34%

= 7’697’574 /- Rs.

Risk Factors


68

1. Change in government policies for this type of

industries may affect the organization positively or

negatively accordingly, as profit may increase or decrease

due to government’s intervention.

2. There is always risk of competition from existing

& potential units. But to avoid this risk, cost reduction

through ideal utilization of resources, use of good quality

of raw materials etc will be helpful.

1) M/s. Akshar Trade Ink.

Raw Material Suppliers


69

Address: Giriraj Complex,

25, Karanpara Corner

Karansinhji Main Road,

Rajkot.

Phone: 2232433

E-mail: [email protected]

2) Murlidhar Polymers

Address: Giriraj Complex,

25, Karanpara Corner

Karansinhji Main Road,

Rajkot.

Phone: 2232433 / 2232666.

Machinery Suppliers

mailto:[email protected]


70

Our unit wil l purchase machinery from fol lowing supplier.

1) Polymechaplast Machine Ltd.

Address: “Gold Coin” House,

775, GIDC, Makarpura

Vadodara 390 010.

Web site: www.polymechplast.com

http://www.polymechplast.com/

Future Prospec

tus


71


72

Each and every unit has its own dreams and plans. The company are always engaged in the activities that how they can achieve bright future and for that planning is a must.

We are going to establish a “Smart Plastics” industry. We will produce 1 litre plastic bottles. We are sure that this unit will definitely get estimated profit. After some years we will introduce/produce one another product i.e. “Plastic Container” with its existing product so we can say that this is our future plan for our organization.

In Smart Plastics, all the members come together and decide some challenging activities and set them as a goal to be achieved in near future. Following are some of the future plans:

1).To captures maximum market.

2). Optimum utilization of resources.

3). to create goodwill.

4). Development of various branches all over the world.

5). to get more profit.

Future Prospectus

Conclusion


73

Conclusion


74

This firm is an emerging firm having bright future. Today most of the people are getting conscious (alert) about fashionable products. This firm tries to satisfy such class of people by providing fashionable water or any other bottles.

As an Entrepreneur, I see high market potentiality and bright career of the firm. At last I hope that all the live factor work with great efficiency and co-ordination, all the other resources are utilized at maximum capacity and united efforts are made to achieve all the predetermined set of goals.

Bibliography


75

Bibliography


76

Serial No.

Book/Site Name Author/Provider

1. [email protected] Polyplast(india)Ltd.

2. Marketing Management Philip Kotler

3. Finance Management I. M. Pandey

4. Manufacturing & Material Management

M. R. Patel

Date post:	15-Jan-2015
Category:	Education
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