Preface

For socio economic growth and balanced structural

development, small-scale industries are a very important tool. It is

considered highly for the creation of employment opportunities as

well as development of entrepreneur skills. The better use of scarce

financial resources and appropriate technology is also ensuring by

the small-scale industries.

In the growth rate of the country, the small scale industries

give vital contribution. Therefore it is essential to understand

management and working of small-scale industries as a student of

business administration.

The subject of “Entrepreneurship and management of Small

Business” has been included by Saurashtra University in Third Year

B.B.A. So I have prepared this project report on one of the small-

scale industries product. That is paper dish and napkin.

Acknowledgement

This is my great pleasure to submit this Product Project

Report. I am thankful to all the persons who have helped me for the

preparation of this project report.

First of all I would like to thank Dr. Mita B. Vora who had

guide me for the preparation of Product Project Report.

I am also thankful to all those who had helped me in one or

another way during preparation and computerization of this Project

Report.

Place : Rajkot (I/C Director)

Academic year : 2005 – 06 __________________

Mr. John Mathew

DeclarationI undersigned, Jagdish V. Khimsuriya a student of Third Year

B.B.A. at T.N. Rao College of I.T. & Management, hereby declare

that the project work presented in this report is my own work and

the report has been prepared under the guidance and supervision

of our co-operative Dr. Mita B. Vora.

This work had not been submitted before this to any other

university with an examination purpose.

Place : Rajkot _________________

Academic year: 2005 – 06 Sign of the Student

Project Profile

Name of the Unit : Blue Sea Paper Industry

Brand Name : Dolphin Paper Dish & Napkin

Address of Unit : Metoda G.I.D.C.

Form of the Unit : Partnership Firm

Size of Organization : Small Scale Industry

SSI Registration No. : Application has been made

Accounting year : 2005 – 06

Business carried out by Unit : Manufacturing and selling of Paper

Dish & Napkin

Utilization Capacity of Plant : 24000000 pcs (60% capacity)

Installed Capacity of Plant : 40000000 pcs

Cost of Project : 1759300

Implementation Schedule : The average time of

Implementation of the Project is

Estimated 71/2 months.

Bio-data of partners

PARTNER – 1: -

Name & Address : Jagdish V. Khimsuriya

“Aai Shree Khodiyar Bhuvan”,

New Thorala, Ramnagar – 3,

Rajkot – 360003.

Age : 20 Years

Education : B.B.A.

Qualification : Management (Final Year continue)

Role of Unit : Managerial and Administrative Fun-

ction

Experience : Nil

Contribution : 60%

PARTNER – 2: -

Name & Address : Amit Goswami

‘Kuber’

9 Lati Plot,

Rajkot - 360003

Age : 28 years

Education : Diploma in Mechanical Engineering

Role of Unit : Undertakes the Supervision of pro-

duction and quality control of the

product.

Experience : Has got the experience of 5 years

in technical aspects of production

of the paper dish & Napkin in the

Hiravati Paper Industry Ltd.

Contribution : 40%

Introduction to the product

India is a very large country and the Indian economy is a

developing economy at present. So each and every industry has

great opportunities to achieve higher and higher growth. Moreover,

our country is very much populated so there is good market

available for producers for their product. That is why the many

overseas companies come to India to get the benefit of large

number of customers available.

Present the lifestyle of the most of the people is so fast that

they are always interested in use and throw things because such

products save their time and energy. Paper dishes & Napkin is one

of such use and throw products. At presents people don’t want to

waste their time of various events and functions.

Paper dishes and napkins are use in large quantity at

marriage functions, other dinner parties, food courts, and

restaurants etc. this product can definitely take over the market

because it saves the time and energy of its consumers and money

of the organizer of the functions where paper Dishes and Napkins

are used the paper Dish and Napkins are easily available in the

market also.

Hence, this is very popular product in the life of the modern

time people.

Uses of the Product

Paper Dishes and Napkins are generally available in various

types of design, color and size. At marriage functions, parties,

receptions etc. lots of paper dishes and Napkins are use by people.

Especially in parties and receptions different types of varieties of

paper napkins are use by guest at parties to clean their hands.

Paper dishes are generally used for dry items at the functions.

Proposed location

This unit will be situated at Metoda G.I.D.C. It is hardly 13 km

away from Rajkot city. Therefore all the benefits, which are

attached with the Rajkot city, will be available to unit. The second

benefit is that Metoda G.D.I.C. is concerned with Industrial Zonal

Area and Government of Gujarat is continuously trying to mobilize

industrialization in this area. Here, all types of facilities like water

supply, electricity, infrastructure, communication etc are easily

available at reasonable rate.

The various factors considers for selection of proposed

location are as follows.

1. Supply of raw material: - Raw material is the basic input, which must be given

equal importance. The most of raw material is made available

from Ashok Paper Industries, which is also located in the

Metoda G.I.D.C. hence; our unit is situated much nearer from

the raw material supplier

2. Availability of labors: - Availability of labor influences the selection of location.

Unit requires both semiskilled and skilled labors. Both types of

labors can be made available from the local are so availability

of labors never creates problem.

3. Transportation facilities: - Transportation is required for assembling of raw

material and distribution of finished product. As most of the

raw materials are available from Ashok Paper Industry

situated in the same area, it is easy to carry out it by

rickshaw.

For the distribution of the finished product; rickshaw,

matador and trucks will be used. As the product is of

lightweight and not of costly nature, it will not require any

special type of transportation facilities. All transportation

facilities are available from Rajkot.

4. Land: - The basic necessity for each and every industry is land.

Without land no industry can be come into existence. In the

Metoda G.I.D.C. land is available at subsidized rate by

government of Gujarat.

5. Power, water supply and other facilities: - As Metoda G.I.D.C. is declared as industrial zone by

the government of Gujarat, the state government provides,

water, power and other facilities like road, shed etc at

cheaper rates.

In this manner the all above mentioned factors

justify the selection of the proposed location that it would

definitely contribute to the profitability and success and

growth of plant.

Production Detail

INSTALLED CAPACITY

NO. PRODUCT DAILY PCS.

MONTHLY (25 DAYS) PCS.

YEARLY (300 DAYS) PCS.

1. Paper dish & napkin

1,33,333 33,33,333 4,00,00,000

CAPACITY UTILIZED (60% At first year & second year)

NO. PRODUCT DAILY PCS.

MONTHLY (25 DAYS) PCS.

YEARLY (300 DAYS) PCS.

1. Paper dish 40,000 10,00,000 1,20,00,0002. Paper napkin 40,000 10,00,000 1,20,00,000

65% AT THIRD YEAR

NO. PRODUCT DAILY PCS.

MONTHLY (25 DAYS) PCS.

YEARLY (300 DAYS) PCS.

1. Paper dish 43,333 10,83,333 1,30,00,0002. Paper napkin 43,333 10,83,333 1,30,00,000

Production Process

Con-v-nient Paper Industry produces Paper Dish & Napkin.

The process of producing paper dish and napkin is very much easy.

Nothing would be complex and the whole process is being

managed by efficient administration and supervision performed by

the most experienced person.

The main raw material required to prepare paper dish and

paper napkin is paper roll. We get raw materials from Ashok Paper

Industry and also from other paper industries. The nearer suppliers

supply most of the raw materials so it is available in less cost.

To produce paper dish, the paper is cut into the required size

by the punching machines as we can say in other words that paper

has been shaped with dish making machines.

For making paper napkins, paper roll is automatically colored

cut into required size with the help of a napkin machine. We

produces paper dish and napkins in various colored and in different

designs as well as sizes.

Thus in this way the production of paper dish and paper

napkin is been made. It starts with acquiring raw material that is

paper rills that are been processed at the unit by paper dish

machine and paper napkin machine and then it makes out the

finished products. Lastly paper dishes and napkins are dispatched

to wholesaler and retailer.

In this manner the process of producing paper dish and

napkin is quite easy.

Financial detail

1. LAND: -

NO. PARTICULARS SQURE METER

RATE/ SQ. M.

AMOUNT

1. Open land 350 500 1,75,0002. Registration - - 55,000

Total 2,30,000

2. BUILDINGS: -

NO. PARTICULARS AREA RATE/ SQ. M.

AMOUNT

1. Factory Shed 300 1,000 30,0002. Office 50 1,200 60,0003. Other (R&D,

bathroom, Water tank, Designing etc.

50 1,350 67,500

Total - - 4,27,500

3. PLANT & MACHINERY: -

NO. PARTICULARS AREA RATE/ SQ. M.

AMOUNT

1. 30’ size paper napkin making machine

01 2,25,000 2,25,000

2. Paper dish making machine

50 1,200 60,000

3. Other (R&D, bathroom, Water tank, Designing etc.

50 1,350 67,500

Total - - 4,27,500

4. FURNITURE & VEHICLE: -

NO. PARTICULARS AMOUNT1. Office furniture 27,0002. Vehicles 3,65,000

Total 3,92,000

5. COAST OF PROJECT

COST OF FIXED ASSETS

NO. PARTICULARS AMOUNT1. Land 2,30,0002. Building 4,27,5003. Plant & machinery 5,66,0004. Furniture & Vehicle 3,92,000

Total 16,15,500

WORKING CAPITAL COST OF PROJECT

NO. PARTICULARS AMOUNT1. Value of raw materials 7,39,2002. Wage & salary 1,03,5003. Electricity bills 14,4004. Overhead expenses 5,700

Total workingcapital(1 year) 8,62,800Total working capital (1 month) 71,900

TOTAL COST OF PROJECT

NO. PARTICULARS AMOUNT1. Fixed assets 16,15,5002. Working capital( 2 months) 1,43,800

Total cost of project 17,59,300

6. FINANCIAL PROVISIONS: -

LOAN

NO. PARTICULARS

G.S.F.C. OWN BANK TOTAL AMOUNT RS.

1. Land 1,30,000 1,00,000 - 2,30,0002. Building 2,00,000 77,500 1,50,000 4,27,5003. Plant &

machinery3,00,000 2,66,000 - 5,66,000

4. Furniture & vehicle

- 92,000 3,00,000 3,92,000

5. Working capital

- 43,800 1,00,000 1,43,800

Total 6,30,000 5,79,300 5,50,000 17,59,300

MEANS OF FINANCE

NO. PARTICULARS AMOUNT1. G.S.F.C. 6,30,0002. Own contribution 5,79,3003. Bank 5,50,000

Total 17,59,300

7. COST OF PRODUCTION: -

RAW MATERIAL

No.

PARTICULARS REQUIREMENT

RATE MONTHLY

YEARLYRS.

1. Paper roll 28,000 1.10 30,800 3,69,6002. Paper dish &

napkin28,000 1.1 30,800 3,69,600

Total 56,000 - 61,600 7,39,200

LABOUR CHARGES

NO. PARTICULARS NUMBERS MONTHLY RS.

YEARLY RS.

1. Skilled labour 01 2,500 30,0002. Semi-skilled

labours01 2,000 24,000

3. Unskilled labour 02 1,500 36,000Total 04 - 90,000Add : 15% other benefit

- - 13,500

Total labourcharges

- - 1,03,500

ELECTRICITY BILL

NO. PARTICULARS MONTHLY RS. YEARLY RS.1. Electricity bills 1,200 14,400

REPAIRS & MAINTENANCE

NO. PARTICULARS YEARLY RS.1. Repairs & maintenance 13,000

INSURANCE & TAXES

NO. PARTICULARS YEARLY RS.1. Insurance & taxes 12,000

DEPRICIATION

NO. PARTICULARS RATE OF DEPRICIATION

YEARLY RS.

1. Building 5% 21,3752. Machinery 15% 84,9003. Furniture 10% 39,200

Total Depreciation

- 1,45,475

INTEREST

NO. PARTICULARS PRINCIPLE AMOUNT RS.

YEARLY INTREST

1. G.S.F.C. 6,30,000 1,00,8002. Own contribution

(15%)5,79,300 86,895

3. Bank (18%) 5,50,000 99,000Total Interest - 2,86,695

ADMINISTRATIVE EXPENSES

NO. PARTICULARS MONTHLY RS. YEARLY RS.1. Stationery 500 6,0002. Postage &

telephone1,200 14,400

Total Amount 1,700 20,400

TOTAL COST OF PRODUCTION: -

NO. PARTICULARS YEARLY RS.1. Raw materials 7,39,2002. Labour charges 1,03,5003. Electricity bills 14,4004. Repairs & maintenance 13,0005. Insurance & taxes 12,0006. Depreciation 1,45,4757. Interest 2,86,6958. Administrative expenses 5,700

Total Cost Of Productions 13,40,370

8. PROFITABILITY OF THE PROJECT: -

PARTICULARS AMOUNT Paper dish, 118 lacs pcs. ( Rs. 11500 per lac pcs.) Paper napkin, 118 lacs pcs. ( Rs 4460 per lac pcs. )

13,57,000 5,26,280

Total salesLess: Total cost of production

18,83,28013,40,370

Profit before taxLess: Income tax @ 35%

5,42,910 1,90,019

Profit After Tax 3,52,891

9. STATEMENT OF CLOSING STOCK: -

PARTICULARS PIECESTotal production @ 60% capacity Less: Total sales

2,40,00,0002,36,00,000

Closing Stock 4,00,000

Break even analysis

Break-even analysis is a scientific analysis, which leads

producers towards more systematic and scientific production

planning or sales planning. It is because of break-even analysis that

the firm can accordingly work out the required size of the plant. By

break even analysis the small-scale entrepreneur can get proper

guidelines about volume of sales to be achieved to avoid the

danger of loss.

Break-even analysis indicates a point where total revenues

are equal total cost. It means a volume of sales where firm earns

neither profit nor suffer loss in called Break-even point.

Calculation of Break Even PointPARTICULARS AMOUNT AMOUNT Sales

Less: Variable cost Raw materials Labour charges Administrative expenses Electricity bills Overhead expenses CONTRIBUTION

Less: Fixed costs Interest Depreciation Insurance & taxes Repairs & maintenance

PROFIT BEFORE TAXLess: Income tax @ 35%

NET PROFIT

7,39,2001,03,500 20,400 14,400 5,700

2,86,6951,45,475 12,000 13,000

18,83,280

8,83,200

10,00,080

4,57,170

5,42,910 1,90,019

3,52,891

Break even point (%): -

Fixed costs= X 100

Contribution

457170= X 100

1000080

= B.E.P. (%) = 45.71%

Break even point (Rs.): -

Fixed costs= X Sales

Contribution

457170= X 1883280

1000080

= B.E.P. (Rs.) = 860910

Profit volume ratio: -

Contribution= X 100

Sales

1000080= X 100

1883280

= P.V.R.= 53.10%

Net profit ratio: -

Net Profit= X 100

Sales

352891= X 100

1883280

= N.P.R.= 18.74%

Market analysis

We know very well that paper dish and napkin are consumer’s

products. Paper dish are use for putting items in it and paper

napkins are used for cleaning the hands by it. These two products

are generally used more in town and city areas. Now it also

becomes popular in many rural areas. At present few units are

manufacturing these products. Looking forward to the demand of

these products, the market of paper dish and paper napkin is very

good.

Ashapura Paper Industry supplies paper dish and paper

napkins to the wholesaler and retailers. It also supplies the same to

the many hotels and restaurants of the cities like Rajkot, Jamnagar,

Bhavnagar, Junagadh etc. Unit also has the benefit of good

relationship with customers because one of the partners Mr. Rohit

Nihalani has maintain very good personal relations with the

customers because of his five years experience in the same

industry.

At present, these products are use in many occasions as well

as at many places like food courts, restaurants, and sweet marts,

etc. It is also used at home while birthday parties; other small

functions etc, so we can say that the market for these products is

very good and the products are well accepted by the people.

Future prospects of the project

In modern age, popularity of these products paper dish and

paper napkin is increasing. Therefore the demand of it is increasing

day by day. Not only of this product but now a day’s future of whole

paper industry is looking very bright. The uses of paper dish and

paper napkin are more in urban areas than rural areas.

This indicates about expansion and development of the

project. Accordingly the present project is also expected have a

better prospects.

Risk factors

It is essential to consider the risk factors before starting the

process of production. The extent of influence of risk factors must

be assessed first.

As far as our unit is concerned, the main risk factors are

competition and various types of designing skills. Every unit

requires the different types of skilled person. Our unit also needs

that type of persons whose designing skill is better than the other

unit’s person.

If the craze of small parties, receptions, etc decreases, the

demand of paper dish and paper napkin may also drop down.

Moreover, some major financial institutes do not recognize our

industry so there is a limitation of source of finance. Government is

right now playing a role of guardian of small-scale industries but in

future if government change its policies regarding such industries, it

will result into increase in coasts of the project.

These are the major risk factors involve with our industry.

Suppliers

MACHINERY AND EQUIPMENTS: -

1. Paper napkin machine M/s. Sheth Engineering Pvt.Ltd.

13, Mody House, 1st floor,

Tribhuvan Road,

Mumbai – 400 004

2. Paper dish making machine and dish punching machine M/s. G.J. Engineering Pvt. Ltd.

Naroda GIDC, Shed No. 48.

Rajkot – Ahemdabad high way road.

RAW MATERIALS: - 1. Ashok Paper Industry – Metoda GIDC

2. Hirawati Paper Industry Limited - Paddahari

3. M/s. Himaliya Paper Board Industry – Gandhidham

A

PROD U CT PROJECT REPORTT

OOn

PAPERR DISH & N A PKIN

COLLEGE

T. N. Rao College of I.T. & Management

GUIDED BY

Dr. Mita B. Vora

SUBMITTED TO

SAURASHTRA UNIVERSITY – RAJKOT

Prepared By : Jagdish V. Khimsuriya

Class : Third Year B.B.A.

Roll Number : 6

Seat Number :

Academic Year : 2005 – 06

INDEXSR.NO

. PARTICULARS

1. Declaration

2. Certificate

3. Introduction To Project Partners & Product

4. Proposed Location

5. Production Details

6. Financial Details Of The Project

7. Break Even Analysis

8. Market Analysis

9. Suppliers

IINTRODUCTIONNTRODUCTION TTOO

PPROJECTROJECT PPARTNERSARTNERS

& P& PRODUCTRODUCT

PPROPOSEDROPOSED

LLOCATIONOCATION

PPRDUCTIONRDUCTION

DDETAILSETAILS

FFINANCIALINANCIAL

DDETAILSETAILS

OOFF

TTHEHE

PPROJECTROJECT

BBREAKREAK E EVENVEN

AANALYSISNALYSIS

MMARKETARKET

AANALYSISNALYSIS

SSUPPLIERSUPPLIERS