EDP REPORT

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AN ENTREPRENEURSHIP

Project report on

“FABRICATION SHOP” A step ahead towards the nation

Submitted by

ROHIT KUMAR

Department of mechanical Engineering

GANDHI INSTITUTE FOR TECHNOLOGY, BBSR

FABRICATION SHOP 2016

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CERTIFICATE

This is to certify that the project report on “FABRICATION SHOP” is a confide

record of the project delivered by GAURAV KUMAR SINGH, JAGANNATH SAHU,

GOBIND GOPAL DAS, JYOTI RANJAN BAG under my supervision and guidance,

in partial fulfillment of the requirements for the award of Degree of Bachelor of

Technology in Mechanical Engineering from GANDHI INSTITUTE FOR

TECHNOLOGY, Bhubaneswar for the year 2012-2016.

HOD Project Coordinator Project Guide

Department Of Mechanical


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ACKNOWLEDGEMENTS

The work presented in this dissertation would not have been possible without the help and support of a large number of people. The author first expresses his heartiest gratitude to his guide and supervisor Prof. ARVIND TRIPATHY, Designation , HOD of Mechanical Engineering, Gandhi institute for technology, Bhubaneswar, Orissa, India for his valuable guidance, help and encouragement in the course of the present work. The successful and timely completion of the work is due to his constant inspiration and constructive criticism. I take this opportunity to express my deepest gratitude to KEDAR NATH HOTA, Co-Ordinator Head, and faculty members of the Department of Mechanical Engineering, GIFT, Bhubaneswar for constant advice, useful discussions, encouragement and support in pursuing the B. Tech work.

The help and cooperation received from the Principal and Dean Academic,

GIFT, Bhubaneswar are gratefully acknowledged.

GAURAV KUMAR SINGH

(1201298388)

JAGANNATH SAHU

(1201298482)

GOBIND GOPAL DAS

(1201298456)

JYOTI RANJAN BAG (1201298333)


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CONTENTS

1. ABSTRACT 1

2. INTRODUCTION TO ENTERPENEURSHIP 2

3. ENTREPRENEURIAL PHILOSOPHY 3

4. CHARACTERISTICS OF ENTREPRENEUR 4

5. CHALLENGES FOR ENTR. PROJECT 4-5

6. ROLE OF FIS BANKS IN SSI FINANCING 7

7. STEEL FABRICATION SHOP INTRODUCTION 8

8. ABOUT THE PRODUCT AND MARKET POTENTIAL 9

9. SCHEME FOR MANUFACTURE OF STEEL

FABRICATION AND RECONDITIONING JOB 9-16

10. REFERENCES 17


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ABSTRACT ON FABRICATION SHOP

Beginning with the Industrial Revolution era, a fabrication shop may be

a room or building which provides both the area and tools (or machinery) that may

be required for the manufacture or repair of manufactured goods. Fabrication

shops were the only places of production until the advent of industrialization and

the development of larger factories. In the 20th and 21st century, many Western

homes contain a fabrication shop in the garage, basement, or an external shed.

Home fabrication shops typically contain a workbench, hand tools, power tools

and other hardware.


https://en.wikipedia.org/wiki/Shed

https://en.wikipedia.org/wiki/Factory

https://en.wikipedia.org/wiki/Industrialization

https://en.wikipedia.org/wiki/Mass_production

https://en.wikipedia.org/wiki/Good_(economics)

https://en.wikipedia.org/wiki/Manufacturing

https://en.wikipedia.org/wiki/Tool

https://en.wikipedia.org/wiki/Building

https://en.wikipedia.org/wiki/Room_(architecture)

https://en.wikipedia.org/wiki/Industrial_Revolution

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2. INTRODUCTION OF ENTREPRENURSHIP

The word ‘entrepreneur’ has its origin in the French language. It refers to the

ORGANISER OF MUSICAL or OTHER ENTERTAINMENTS. ENTREPRENURSHIP

can be described as a creative &innovative response to the environment. Such responses

can takes place in any field of social Endeavour-business, agriculture, education, social

work the like. An entrepreneur is one who organizes, manages & assumes the risks of an

enterprise. An entrepreneur visualizes a business, takes bold steps to establish under

taking, co-ordinates the various factors of production gives it a start. ENTREPRENEURS

are the owners of the business who contribute the capital & bear the risk of uncertainties

in business life. ENTREPRENEUR is action-orient & highly motivated person who has

the ability to evaluate business opportunities, to gather the necessary resources to take

advantage of them &to intimate appropriate action to ensure success. ENTREPRENEUR

takes decision regarding what to produce, where to produce & whom to produce.


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3. ENTREPRENEURIAL PHILOSOPHY

1. To take calculated risk.

2. Willingness to accept responsibility for one’s own work

3. Failure must be accepted as a learning experience

4. Goal oriented ness.

5. Acceptable results are more important than perfect results.

6. Personal growth. EXPECTATIONS OF ENTREPRENEURSHIP

It is expected from the entrepreneurs that they will help:-

1. Increase number of industries.

2. Increase production.

3. Increase employment opportunities.

4. Earn foreign exchange through exports.

5. Develop the underdeveloped parts of the country.

6. Economical development.


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4. CHARACTERSTICS OF ENTREPRRENUR:

SELF CONFIDENCE

TASK-RESULT ORIENTED

RISK-TAKER

LEADERSHIP

ORIGINALITY

FUTURE ORIENTED

5. CHALLENGES FOR ENTREPRENEURSHIP PROJECT:-

1. Technology Up gradation :-

It is found that our small scale sector is not able to compete because of outdated

technology. We must appreciate that small scale industry has to keep itself updated and

then only it can sell goods. In the post WTO era, the best thing would be available

anywhere in the world as there is no restriction for goods to move. People will purchase

only if the goods are of good quality.

We must remember that we may or may not need imported technology for up gradation.

Our small industries have the advantage of developing in import substitution period.

Many SSI can therefore become world class with only small modifications or

improvement.

2. Testing facilities: -

Because our small scale industries are situated in far flung areas there for it is not

possible to service by one or two central laboratory. We suggest that educational


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institution even in small towns should be equipped to provide testing facilities to small

scale industries.

3. Exports: -

We find that small scale industries engaged in exports do not have any benefits, although

they count for bulk export. We strongly advocate special concessions for small scale

industries, which are engaged in exports.

4. Involvement of Industrial Associations:-

We feel that many problems of small sector can be taken care of if industrial associations

are involved in a big way.

5.InfrastructureDevelopment:

Small scale industries suffer maximum from lack of infrastructure development. The

quality of power is bad and the power available is at very high cost. This must be

corrected. Roads are bad. Communication facilities are not up to mark etc.

6. Credit: -

The credit is still not available to small scale industries. The credit Guarantee Fund

created by SIDBI is not being exploited as there are still short coming in the scheme.

7. Skill Up gradation: -

Small scale Industries are known for providing on job training. But in the post WTO era

when cost cutting is order of the day, the people are running small scale industries must

be skilled and these skills must be up graded continuously so that they are in the job & no

unemployment results.


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8. Marketing:-

The present market assistance scheme is most welcome. More such schemes are

required .Small Scale Industries are being bundled out of the market by aggressive

advertisement done by large scale& multinationals. The small sector must be protected

from this, if the small sector has to survive.

9. Changing the Labour Laws:-

The present labour laws must be changed to have more flexibility & suitability for

running of small scale sector.

10. Removal of inspector Raj: -

A small scale industry is generally a single man show. He can not find time to attend to

all the inspectors visiting small scale factory. The Inspector Raj must be finished.

Conclusion can be taken considering above challenges SSI unit in the following

areas will have a bright future & compete with world industries very well as these are the

areas of our strength:-

1. tourism & hotel industry

2. dairy Industries

3. food processing industries

4. Floriculture

5. Shoe& leather Industries

6. Forging unit

7. steel alloy casting

8. Plastic processing Industry


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6. ROLE OF FIs & BANKS IN SSI FINANCING :

The credit needs of entrepreneurs could be divided in three parts: short term, medium

term and long term finance. Accordingly, the conventional mechanism for financing of

SSIs in India stressed provision of terms loans and working capital. The public and

private sector banks, Small Industries Development Bank of India (SIDBI), Regional

Rural Banks (RRBs), Urban Cooperative Banks (UCBs) and foreign loans for setting up

of new industries or modernization of the existing ones, Khadi and Village Industries

Commission (KVIC) and Khadi and Village Industries Boards (KVIBs) assist in

financing khadi and village industry sector. National Small Industries Corporation

(NSIC) and State Small Industries Corporations (SSICs) in their own way, also attempt to

develop the cottage and small scale sector by supplying machinery on a hire-purchase

basis to small-scale and ancillary industries, inclusion of the value of machinery and

equipment already installed.


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SFCs are one of the oldest credit institutions in the country which mainly cater to he long

term credit needs of small & medium enterprises. At present, there are 18 SFCs covering

the entire country & they have been in existence for 5decades now. The cumulative

sanctions & disbursements of SFCs aggregated Rs33000 crore & Rs 27000 crore

respectively. It needs to be highlighted that almost 75% of SFCs assistance flows to the

SSI sector. Over the years the financial health of SFCs has become a cause of concerns.

Some of the reasons for the poor financial health of SFCs is poor recovery performance

increase in non per forming assets Govt. of India had amended the SFCs act1951 in the

year2000 so as to give them more operational flexibility& freedom so that they can

improve their performance& play their role more effectively.

7. STEEL FABRICATION/STEEL SHUTTER/STEEL ALMIRAH

INTRODUCTION:

Fabricated steel products cover a host of items such as steel furniture, storage tanks, grill

gates, rolling shutter etc. Of these items, steel furniture which are strongly consumer-

oriented are a separate class of products. The other items such as gates, grills, tanks and

rolling shutter may be categorized together while there are a number of steel furniture

units in the north-eastern region. Units manufacturing items like tanks, gates, grills,

rolling shutter are few in number and hence there are good prospects in the line for

entrepreneurs, especially those who are technically qualified.


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ABOUT THE PRODUCT:

The unit propose to manufacture steel fabricated items like gates, grills, rolling shutters

and steel tanks which are required both for domestic and commercial establishments.

These steel products are the only replacement of wood in terms of cost and durability.

These products will be varied in shapes and sizes as per the demand.


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MARKET POTENTIAL:

It is assumed that the housing shortage is about 7 lakh in urban areas and 70 lakh in rural

areas. To mitigate the housing shortage in about five years time about 1.25 lakhs urban

dwelling per year and 14 lakhs rural dwellings per year would have to be constructed. It

may be conservatively assumed that an average at least about 90,000 urban dwellings and

10 lakh rural dwellings are constructed per year. Assuming that out of the new dwellings

to be constructed the requirement of gates, grills, rolling shutters, tanks would be about

5% in case of rural dwelling and 20% in case of urban dwelling the demand for these

products estimated as under.

A) Block capital Requirement

i) Land & Building : Rs. own

ii)Land –Leasehold R39,600.00

ii) Covered area sq ft 1000sqft Rs.50,000.0

iii)Water & Sanitation

Arrangement

: Available from

D.M.C

MACHINERY & EQUIPMENT

_ARTICULARS Cost(Rs) Nos Total Cost (Rs.)

i.) Lathe Machine 60,000 1 60,000.00

ii) Welding Machine 18,000 1 18,000.00

iii) Sheet Bending M/C 25000 1 25,000.00

iv) Grinding Machine 4000 1 4,000.00

v ) Bench grinding M/C 3000 1 3,000.00

vi) Stand drillM/c 16000 1 16000.00

vii) Cutozen Set 4000 1 4000.00


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viii) Spray painting M/C 12000 1 12,000.00

1,46,000.00

FOR RESEARCH & DEVELOPMENT

i)Cost of fright & sales Tex 5,000.00

ii)Installation & Electrification charges

15,000.0

0

iii)Mise. Expenses 2,000.00

iv)Escalation 2,000.0v)Office Furniture &

equipment 15,000.0

1,85,000

III. TOTAL BLOCK CAPITAL

i) Land & Building 89,600.00ii) Machinery &

Equipments 1,85,000.00

2,74,600

C. RECURRING EXPENDITURERaw Materials components Requirement

( Monthly)Sl.

No. Particulars

Unit Cost

(Rs.) Quantity Required (MT) Total Cost (RS.)

i) CRC Sheet 35000 2 70,000.0

ii)Angel flat channel etc 35000 1 35,000.0iii)Paint red oxide Welding rod DA

&Oxygen 20,000.0


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iv) Fittings 10.000.01,30,000.00

Staff & Labours (Monthly)

Sl.No Category Rate(Rs.) Nos. Amount(Rs.)i.) Skilled Workers 4,000.00 2 : 8000.00

ii) Unskilled Workers 3000.00 3 : 9000.00

Iii Perquisites / Benefits --------------

17,,000

III OVERHEAD EXPENSES (MONTHLY)

Sl. No. Particulars Amount (Rs.)

i) Rent 0.00

ii) Power- Electric 4000.00

iii.) Tax License & Insurance 300.00

iv.) Repair & Maintenance 500.00

v.) Traveling Expanses 500.00

iv) Carriage (inward/ Outward) 2000.00

vi.) Advertisement/ Publicity 500.00

viii.)

Office Expenses/

Contingency 500.00

ix.) Misc. Expenses 500.00

x.) Consumable Item 2800.00

11,600.00

:


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TOTAL RECURRING EXPENDITURE (MONTHLY)

Sl.No. Particulars Total Cost (Rs.)

a) Raw Materials : 1,35,000.00

b) Staff & Labours : 17,000.00

c) Overhead Expenses : 11,600.00

1,63,600.00

D. WOKING CAPITAL REQIREMENT

Monthly Recurring Expenditure x 3 monthly (maximum) 3,27,200.00

Capital Investment . Project Cost

Block capital Rs. 2,76,600.00 Block capital Rs. 3,13,600.00

Working Capital Rs. 3,27,200.00 25 % of W.C. Rs .81,800.00

TOTAL Rs 6,01,800.00 TOTAL Rs. 3,56,400.00

Rate(Rs.) Qty(MT) Amount(Rs)

a.) recurring Expenses Rs. 163600.00 Steel Almirah 5000.00 20 1,00,000.00

b.) Dep.of Bldg.@ 5 % Rs. 208.00 Reconditioning job 90,000.00

c.) Dep.0f Machinery@10 % Rs 1217.00

d.)Instt on Term Lone @13 % Rs. 6520.00

e.) Wastage 1 to 2 % Rs.0.00 .

f.) Gross Profit Rs. 18455.00

TOTAL Rs 1,90,000.00 TOTAL Rs.1,90,,000.00


F.Tentative Profit & loss Account (Monthly)

a.)Profit Sale Recio Monthly Profit x 100 = 19.70 %

Monthly Sale

b.) Return of Investment Annual Profit x 100 = 36.80 %

Capital Investment

c.) B.E.P. Fixed Cost x 100 = 52.22%

Fixed Cost + Profit

FABRICATION SHOP

Fixed Cost / month composes of :-

40 % of Salary & Wages = 29,040.00

40 % of Consumption of Power &

Overhead expenses = 60,800.00

100 % of rent =

100 % of tax, License & Insurance = 100.00

100 %of Depriciation = 36,645.00

100 % of Instt. ( Payable to Bank & other) = 1,28,330.00

2,54,915.00

REFERENCES

1.DAS FABRICATION SHOP, BHADRAK

2.www.fabricationwiki.com

3.www.google.com

FABRICATION SHOP

http://www.google.com/

http://www.fabricationwiki.com/

Documents

EDP REPORT