PLASTIC BOTTLES AND CAPS MANUFACTURING UNIT

Transcription

PLASTIC
BOTTLES AND
CAPS
MANUFACTURING
UNIT
Industrial Estate, Phuntsholing Dzongkhag
2016
1 EXECUTIVE SUMMARY
Plastic Bottles and Caps Manufacturing Unit(PBCMU) is a commercial production unit, in
which, the most convenience-size bottles are made from Polyethylene Terephthalate (PET)
and caps from Polypropylene (PP). PET has become the material of choice for bottled
beverages because it is lightweight and shatter resistant, and PET has been extensively
tested for safety. PET resin has superior properties i.e. attractive, pure, safe, good barrier, no
leakage, design flexibility, recyclable, etc. Bottles made with PET are widely used for
everything from water and fruit juice to soft drinks etc.
PBCMU will be suitable to be located at Industrial Estate under Phuntsholing Dzongkhag due
to certain factors such as proximity to market and less transportation cost. The location also
has competitive advantages due to its availability of industrial land. The proposed business
will procure high quality machines for producing various types of bottles and caps. All the
machines (from injection molding machines to blowing machine and slitting machine) and
raw materials required will be imported from China.
In Bhutan, every day, thousands of consumers rely on the safety and ease of plastic bottles
to help to preserve the quality and freshness of what we drink and serve our families. Plastic
make possible an array of opportunities for transporting, storing and serving our favorite
beverages, and today’s convenience-size bottles are an increasingly popular choice for busy
people everywhere.
FINANCIAL SUMMARY AS OF YEAR 1
8,625,000
7,368,508
4,893,100
4,564,884
1,996,877
1,141,221
80% Debt
20% Equity Fixed Capital Operational Total Sales
cost
Net Profit
The project plant needs
to avail BTN 4,564,8841
as an 80% loan and inject
20% equity of BTN
1,141,221 to realize its
establishment of the
project.
The
initial
investment
of
the
proposed business is BTN
5,706,105
which
comprises of the startup
cost of BTN 5,163,380
and working capital of
BTN 542,725.
The total land requirement, including provision for open space is 50 decimals, of which 35
decimals will be covered by production unit (semi-permanent building) keeping 15 decimals
free space. The products will be distributed to carbonated beverage and mineral water
industries in Bhutan. These units manufacture variety of products, ranging from bottles for
mineral water to packaging for juices and soft drinks.
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2016
Some domestic manufacturing industries in Bhutan are converting from the bottle
containers of traditional material to plastic substitutes for packaging of their products. The
domestic manufacturers using plastic products is increasing. Businesses from different fields
are shifting from conventional packaging to PET bottles. Carbonated beverage and mineral
water industries are good examples for the increasing demand of PET bottles, as majority of
the players in these industries have shifted to PET bottles.
The project plant will employ 12 people and this would provide employment opportunities
and contribute towards the livelihood improvement of the people in the community and also
train them in their specific fields.
In the initial year, all the calculations have been based on PET bottles of two different sizes
500ml & 1000ml bottles and PP caps of 28mm. The business aims on producing 1.31million,
.86million and 4.95million pieces of 500ml, 1000ml bottles and 28mm caps per annum
respectively which will be worth BTN 7,125,000. The production capacity and cost has been
kept to the minimum (average) to avoid over estimation of the production and sales.
The
plant
has
projected to achieve
total sales of BTN
12,627,863 against
the operational cost
of BTN 9,183,321 by
the end of the fifth
financial year. The
business
would
increase its yearly
sales (on an average)
by 9.09% projected
for five years.
8,625,000
6,526,954
9,487,500
7,090,275
10,436,250
7,708,788
11,479,875
8,387,942
12,627,863
9,183,321
3,751,847
2,626,293
4,272,519
4,776,247
2,852,681
1,996,877
3,280,080
2,296,056
2,990,764
3,343,373
Year 1
Year 2
Year 3
Year 4
Year 5
Net Profit
Net Income
Expenditure Cost
Total Sales
Besides its healthy financial standing due to its strategic investment and management plan,
PBCMU achieve its break-even point at unit 27,746,559 by 3 years and 8 months and enjoys
healthy liquidity with the payback period of 3 years and 6 months, net present value (NPV)
of BTN 1,047,479 and an internal rate of return (IRR) of 16%.
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2016
CONTENTS
EXECUTIVE SUMMARY .............................................................................................................................. 1
VISION............................................................................................................................................................... 5
MISSION ........................................................................................................................................................... 5
THE BUSINESS PROFILE............................................................................................................................ 5
BUSINESS BACKGROUND.......................................................................................................................... 6
KEYS TO SUCCESS ........................................................................................................................................ 7
6.1 AVAILABILITY OF THE REQUIRED PEOPLE ............................................................................. 7
6.2 LOCATION OF THE BUSINESS AND ITS ACCESSIBILITY ...................................................... 7
6.3 MONOPOLY MARKET ......................................................................................................................... 7
6.4 AVAILABILITY OF LAND ................................................................................................................... 7
6.5 STRENGTH .............................................................................................................................................. 7
6.6 WEAKNESS ............................................................................................................................................. 7
6.7 OPPORTUNITY ...................................................................................................................................... 7
6.8 THREAT ................................................................................................................................................... 7
7 SWOT ANALYSIS ........................................................................................................................................... 7
8 MEANS OF FINANCING .............................................................................................................................. 8
TABLE: TOTAL INVESTMENT REQUIREMENT SUMMARY .............................................................. 8
9 MARKETING PLAN ....................................................................................................................................... 8
9.1 PRODUCT DESCRIPTION .................................................................................................................. 8
9.2 MARKET SEGMENTATION ............................................................................................................... 9
10 DEMAND AND SUPPLY ANALYSIS ...................................................................................................... 9
11 ENTERPRISE MARKETING STRATEGY .......................................................................................... 10
11.1 MARKETING MIX STRATEGY .................................................................................................... 10
11.1.1 Products........................................................................................................................................ 10
11.1.2 Price ............................................................................................................................................... 11
11.1.3 Place ............................................................................................................................................... 11
11.1.4 Promotion .................................................................................................................................... 11
11.1.5 People ............................................................................................................................................ 11
11.1.6 Process .......................................................................................................................................... 11
11.1.7 Physical Evidence ..................................................................................................................... 11
10 MANAGEMENT PLAN............................................................................................................................ 12
ROLES AND RESPONSIBILITIES .............................................................................................................. 12
11 MACHINERIES AND RAW MATERIALS .......................................................................................... 13
11.1 MACHINES ........................................................................................................................................ 13
11.2 RAW MATERIALS ........................................................................................................................... 13
12 PRODUCTION PROCESS ....................................................................................................................... 14
12.1 The process of making PET bottles ......................................................................................... 14
12.2 The process of making PP bottle caps.................................................................................... 14
1
2
3
4
5
6
3
2016
13 SAFETY MEASURES IN THE WORKPLACE ................................................................................... 15
13.1 SAFETY MEASURES FOR LABOR ............................................................................................. 15
13.2 PERSONAL SAFETY ....................................................................................................................... 15
13.3 NOISE .................................................................................................................................................. 15
13.4 PERSONAL PROTECTIVE EQUIPMENT ................................................................................. 15
13.5 FIRST AID .......................................................................................................................................... 15
14 FORECAST ................................................................................................................................................. 16
14.1 PRODUCTION CAPACITY ............................................................................................................ 16
14.2 SALES FORECAST ........................................................................................................................... 16
15 FINANCIAL PLAN .................................................................................................................................... 17
15.1 TOTAL PROJECT COST ................................................................................................................. 17
15.2 FIXED ASSETS COST...................................................................................................................... 18
15.3 NET VALUE OF ASSETS ............................................................................................................... 19
15.4 INVENTORY COST PROJECTION .............................................................................................. 20
15.5 MANPOWER COST ......................................................................................................................... 20
15.6 LOAN PAYMENT FOR FIVE YEARS .......................................................................................... 21
16 TOTAL OPERATIONAL EXPENDITURE PROJECTION............................................................... 21
17 FINANCIAL ANALYSIS .......................................................................................................................... 22
17.1 PROJECTED INCOME STATEMENT ......................................................................................... 22
17.2 PROJECTED CASH FLOW STATEMENT ................................................................................. 23
17.3 PROJECTED BALANCE SHEET STATEMENT ....................................................................... 24
17.4 VALUE ADDITION & UNIT COST OF PRODUCTION .......................................................... 24
17.5 RETURN ON INVESTMENT AND EQUITY ............................................................................. 25
17.6 COST DATA ANALYSIS ................................................................................................................. 25
17.7 COST BENEFIT ANALYSIS ........................................................................................................... 25
17.8 NET PRESENT VALUE (NPV) and INTERNAL RATE OF RETURN (IRR) ................... 25
17.9 PAY BACK PERIOD ......................................................................................................................... 25
17.10 BREAK EVEN ANALYSIS .............................................................................................................. 26
18 CONCLUSION ............................................................................................................................................ 27
19 ANNEXURES ............................................................................................................................................. 28
19.1 Breakdown Cost for Construction of Plant House and Labour Cost .......................... 28
19.2 Installation Cost break down .................................................................................................... 28
20 PROJECT TIMELINE ............................................................................................................................... 29
21 FINANCIAL INSTITUTION (FINANCIAL PLANS AND ANALYSIS) ........................................ 30
22 LODEN (FINANCIAL PLANS AND ANALYSIS) .............................................................................. 41
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2016
2 VISION
“To be the leading producer of plastic bottles and caps in the country”
3 MISSION





To provide consumers with high quality plastic products at a reasonable price
To create employment opportunities especially to the Bhutanese
To decrease imports of plastic bottles and caps by contributing to national economy
To create self-sufficiency and sustainable business enterprise
To contribute towards the livelihood of the people of the community through
employment
4 THE BUSINESS PROFILE
PROPOSED NAME OF THE BUSINESS
PROPOSED BUSINESS TYPE
PROPOSED ACTIVITY
PROPOSED STARTUP COST
PROPOSED WORKING CAPITAL
TOTAL INVESTMENT REQUIRED
MEANS OF FINANCING
80% DEBT
20% EQUITY
PROPOSED LOCATION OF THE
BUSINESS
PROPOSED PRODUCTS
LAND REQUIRMENT
POWER REQUIREMENT
SUPPLIER DETAILS
PROPOSED STAFF REQUIREMENT
5
Plastic Bottles and Caps Manufacturing Unit
Production and Manufacturing
Production of PET Bottles and PP Caps
BTN 5,163,380
BTN 542,725
BTN 5,706,105
80 % Debt and 20% Equity
BTN 4,564,8841
BTN 1,141,221
Industrial Estate based in Phuntsholing Dzongkhag
PET Bottles: 500ml and 1000ml and PP Bottle
Caps: 28mm
Total 50 decimals - Lease (35 decimals for the
semi-permanent building and 15 decimals for free
space)
BTN 20,000 Monthly
Taizhou Hanyu Machinery & Mould Co., Ltd and
Hebei Yuyin Trade Co. Ltd in China, M/s. Karma
Tshokhang in P/ling and others.
1 Manager
1 Production Manager
1 Purchase Officer
1 Supervisor
1 Accountant
4 Machine Operators
2 Marketing and Sales person
1 Guard Cum Store Keeper
Others on Requirement Basis
2016
5 BUSINESS BACKGROUND
Plastic Bottles and Caps Manufacturing Unit will be strategically located with its
production unit based in Industrial Estate under Phuntsholing Dzongkhag. The proposed
business plant will produce 1.31million, .86million and 4.95million pieces of 500ml, 1000ml
bottles and 28mm caps respectively in the first year alone to market and distribute to
carbonated beverage and mineral water industries in the country.
With every passing day, people are shifting to PET bottling because of lower cost and better
preservation of their product. Because of the high demand of PET bottles, there is a
manufacturing units in Phuntsholing, Yarkay Pvt. Limited which produces and supply PET
bottle perform. But there is no bottle caps manufacturing unit in Bhutan which is has more
competitive advantage for BPCMU.
The project plant will procure machineries and auxiliary equipment’s from Taizhou Hanyu
Machinery & Mould Co., Ltd and Hebei Yuyin Trade Co. Ltd in China.
The machines have a production capacity of 8700pcs per hour but only 8400pcs per hour
has been considered for the production. Capacity production has kept on an average and only
25 workings day for each month with 8 hours each day has also been considered in the
production process. The proposed business has projected its selling price to the minimum
(average) in order to avoid over estimation of sales.
In the first year, the proposed business plans to construct a semi-permanent building on 35
decimal of land (total 50 decimals – lease). The lease land will cost Nu. 5 per sq ft per year
which means 50 decimals (21,780 sq ft) will cost Nu. 108,900 per year.
The products will be sold to carbonated beverage and mineral water industries in the
country. In the long run, the business plans on reducing the imports of PET bottles and PP
bottle caps. The production unit will produce on a regular basis. This will help the business
carry forward its subsequent financial periods without any problem.
The project plant will also discourage Bhutanese importing plastic bottles and caps from
other countries. We also see marketing our products in other countries as we gradually gain
market shares and win the hearts of Bhutanese markets.
In each of the target market (beverage and mineral water industries), PBCMU will market
its products through both order and direct sales along with the delivery services.
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2016
6 KEYS TO SUCCESS
6.1 AVAILABILITY OF THE REQUIRED PEOPLE
PBCMU will employ qualified 12 people and train them. Doing so would provide
employment opportunities and contribute towards the livelihood improvement of the
people in the community and also train them in their specific fields.
6.2 LOCATION OF THE BUSINESS AND ITS ACCESSIBILITY
The location of the proposed business with its production unit established in Phuntsholing
Industrial Estate has numerous competitive advantages. The first one is that, the production
unit will be located at the Industrial Estate which means it will be far from human
settlements and secondly the transportation cost will be less due to nearest to market.
Therefore, the project is accessible to market since majority of the beverage industries are
located in Phuntsholing.
6.3 MONOPOLY MARKET
The project plant will enjoy monopoly market since there is no ideal plastic bottles and caps
manufacturing company in the country. Moreover, all the bottle caps are imported especially
from India. Some carbonated beverage and mineral water industries acquires bottle
preforms from Yarab Pvt. Ltd., for the production of bottles.
6.4 AVAILABILITY OF LAND
The project needs to be leased 50 decimal of land in the industrial estate under Phuntsholing
Dzongkhag. The semi-permanent building will have a plinth area of 35 decimals. The cost for
the lease land is Nu. 5 per sq ft, which means 50 decimals (21,780 sq ft) will cost Nu. 108,900
per year.
7
SWOT ANALYSIS
6.5 STRENGTH
6.6 WEAKNESS
 Location of the proposed business
 Inadequate fund to set up the business
 Proximity and accessibility to market
 Inadequate knowledge and skills
 Market not yet explored, and the  Untrained or semi-skilled labor
market is guaranteed
 Monopoly market
6.7 OPPORTUNITY
6.8 THREAT
 To reduce imports by contributing to  Enter of homogeneous manufacturing
national economy
unit
 Increasing the production capacity to  Import of same products from India at
meet the production target
cheaper rates
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2016
8 MEANS OF FINANCING
The total projected cost of the business consists of startup cost and working capital.
TABLE: TOTAL INVESTMENT REQUIREMENT SUMMARY
PARTICULAR
TOTAL PROJECT COST
WORKING CAPITAL
TOTAL INVESTMENT
20% EQUITY
80% LOAN
PARTICULARS
Advertising
Delivery expenses
Insurance
Inventory purchases
Miscellaneous
Payroll
Professional fees
Rent or lease
Taxes and licenses
Utilities & telephone
Others
TOTAL
AMOUNT
5,163,380
542,725
5,706,105
1,141,221
4,564,8841
WORKING CAPITAL
3,000
5,000
3,500
276,081
2,000
97,000
5,000
9,075
4,500
7,500
46,000
542,725
Note: The production unit will produce on a regular basis. So for the total investment calculation, only one
month’s working capital is taken into consideration.
9 MARKETING PLAN
9.1 PRODUCT DESCRIPTION
PET bottles are a packaging medium, made up of Polyethylene Terephthalate (PET). These
are widely used in food grade packaging and are the preferred packaging medium due to
their several advantages over other resins like PE, HDPE and PVE.
PET bottles are used as packaging in a variety of products. The demand of PET bottles is on
a rise as most of the manufactures from different businesses are converting to PET bottles
for the packaging of their products. The PET bottles are commonly used for the packaging of
mineral Water, Carbonated Beverages, Edible Oil, Detergents, Lubricating Oils etc. As PET
bottles provide better packaging, and have a lower cost than the bottles made from glass and
8
2016
other materials, different businesses in beverage, food and non-food industry are shifting
towards PET bottles.
The proposed project will be capable of making PET bottles and PP bottle caps of different
sizes. The size of bottles will depend on customer specifications. Commonly manufactured
sizes shall be:
Sl. No
Plastic Products
1
2
3
PET Bottle (500ml)
PET Bottle (1000ml)
PP Bottle Caps (28mm)
9.2 MARKET SEGMENTATION
The products will be distributed to all carbonated beverage and mineral water industries at
affordable costs. There is producer which produces bottle preforms in Phuntsholing, Yarab
Pvt. Ltd., but there is no PET bottles and caps producer in Bhutan and all are imported. This
add competitive advantage to the project plant. Considering average production capacity,
the products will be sold to beverage and mineral water industries at affordable cost in order
to avoid over estimation of the cost.
10 DEMAND AND SUPPLY ANALYSIS
Beverage and mineral water industries in Bhutan are enjoying awesome profits over several
years. Some of the major beverage and mineral water industries are Bhutan Agro Industries
Ltd. (BAIL), Bhutan Milk and Agro Pvt. Ltd., Zimdra Food Pvt. Ltd., Bhutan Fruit Factory
(BFF), Tashi Beverages Limited, Eusuna Mineral Water, Deutse Spring Water, Kurje
Drubchhu.
In Bhutan, every day, thousands of consumers rely on the safety and ease of plastic bottles
to help to preserve the quality and freshness of what we drink and serve our families. Plastic
make possible an array of opportunities for transporting, storing and serving our favorite
beverages, and today’s convenience-size bottles are an increasingly popular choice for busy
people everywhere.
Domestic manufacturing industries in Bhutan are converting from the bottle containers of
traditional material to plastic substitutes for packaging of their products. The domestic
manufacturers using plastic products is increasing. Businesses from different fields are
shifting from conventional packaging to PET bottles. Carbonated beverage and mineral
9
2016
water industries are good examples for the increasing demand of PET bottles, as majority of
the players in these industries have shifted to PET bottles.
Four major players (Bhutan Agro Industries Ltd. (BAIL), Bhutan Milk and Agro Pvt. Ltd.,
Zimdra Food Pvt. Ltd., Bhutan Fruit Factory (BFF)) have a collective installed capacity of 23
million litres juice and production totaled around 13 million litres in 2012 of which just 15
to 20 per cent is exported, primarily to India.
The number one products that makes the huge sales is the supply of mineral water followed
by fruit squash and juices. Other products like canned vegetables and fruits, jams and pickles
make up the rest.
Bhutan Agro Industries Limited sells more than 300,000 bottled water excluding other
beverage bottle, kurje Drubchhu sell more than 250,000 bottled water, Deutse spring water
sells more than 250,000 bottle water and Eusuna natural mineral water sells more than
350,000 bottled water per month. On an average the mineral water industries sell around
250,000 (on an average) per month.
From the above figures, its shows that the demand for the mineral water and juices is very
high and consumption pattern is increasing every year. If the proposed business sell at least
20,000 bottles per month to each producer, the business operation will be successful. Bottle
caps will be also sold as there is not producers of cap in Bhutan.
11 ENTERPRISE MARKETING STRATEGY
In the case of the proposed business, there are no big competitors within the country but the
project consider competition with the producer of PET bottle preforms in the market and
with one which are mainly imported from other countries.
Therefore, the proposed business plans to do innovative, aggressive and strategic marketing
through use of broadcast and print media. The enterprise will also create its online presence
through the social networks and website.
11.1 MARKETING MIX STRATEGY
The strategy will help Plastic Bottles and Caps Manufacturing Unit in getting the right
products and services to the customer at right price, at right place and at right time. In line
with this, the 7ps’ of the proposed business are as follows:
11.1.1 Products
The products dealt for the sales are PET bottles (500ml and 1000ml) and PP bottle caps
(28mm) in the initial year.
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2016
11.1.2 Price
The price of the products is dependent much on cost of production particularly the cost of
raw materials and other overhead costs. However, the utmost care will be considered to
make the price competitive or at least affordable by strategizing “penetrative price method”.
The price offered will be inclusive of nominal profit.
11.1.3 Place
The products will be distributed to beverage and mineral water industries in Bhutan.
11.1.4 Promotion
The promotion ability of business will be major concern especially during business
inception. Therefore, a decent marketing plan of frequently advertising in Kuensel and other
media will be done. Huge promotion will be also done through social media.
11.1.5 People
The employees of this business will be trained professionally to handle customers’
complaints and suggestions. Indeed, any customer complaint will be taken as positive
criticism.
11.1.6 Process
The process of delivering goods and services will always be with right attitude. In this
connection issues like waiting time, product information, product display and attitude will
be considered to achieve sales target.
11.1.7 Physical Evidence
An efficient service can’t be felt unless it is delivered and acknowledged by the end customer.
Therefore, it’s imperative that the proposed business will distribute the samples to target
markets.
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2016
10 MANAGEMENT PLAN
PARTICULARS
General Manager
Production Manager
Purchase Officer
Accountant
Supervisor
Machine Operator (skilled worker)
Sales and marketing person
Guard cum storekeeper
Part-time labor and others
TOTAL
NO OF REQUIRED PEOPLE
1
1
1
1
1
4
2
1
Requirement Basis
12
The business enterprise needs to recruit 12 people in the various capacities for specific roles.
The enterprise will (which is inevitable and the most important) further train and orient the
recruits in their areas of work for the smooth operations.
ROLES AND RESPONSIBILITIES
Manager: Responsibilities to manage the business, enter into agreement, sign contract,
strike deal, supervise and manage overall business operations.
Production Manager: He/she will be involved in the planning, coordination and control of
manufacturing processes and should ensure that goods are produced efficiently and that the
correct amount is produced at the right cost and level of quality.
Purchase Officer: He/she will be responsible for buying the best quality equipment, raw
materials for a company or organization at the most competitive prices.
Accountant: He/she will keep the daily records of the business.
Supervisor: He/she will coach, mentor and advocate employees and company.
Machine Operator: They will operate the machines.
Marketing and Sales person: He/she will be responsible for the marketing plan, campaigns
and developing new innovative ways to market the products and selling of products within
agreed timescales.
Guard Cum Storekeeper: He/she will be responsible for looking after the production unit
and keeping the inventories and raw materials properly and safely.
Part-time Labor and Others: Loading, unloading, transporting, maintenance, etc.
12
2016
11 MACHINERIES AND RAW MATERIALS
11.1 MACHINES
The machines will be purchased from Taizhou Hanyu Machinery & Mould Co., Ltd based in
China. The machineries required are as follows:
Plant and Machinery
Injection Machine (HY-1500)
Auxiliary Equipment:
Plastic Dryer (XHD-100KG)
Plastic Auto loader (XTL-600 GN)
Water Chiller (5P)
Cooling Tower (40TON)
Crusher (XFS-300)
Preform Mold (12cavity)
Cap Mold (24cavity)
Full automatic slitting machine (cap)
Semi-automatic mould blowing machine (HY-B-I) 2 cavity:
Stretch Blow Equipment and Rotary infrared pre-heater
High pressure air compressor
High pressure pipe
Air filter (2 nos)
Air cold dryer
Blowing mold (500ml)
TOTAL
USD
18,000
600
600
1,800
830
3,360
5,040
7,560
2,190
4,000
2,290
200
220
910
360
440
48,400
BTN
1,206,000
40,200
40,200
120,600
55,610
225,120
337,680
506,520
146,730
268,000
153,430
13,400
14,740
60,970
24,120
29,480
3,242,800
Note:
 Selling rate of a dollar has been considered at Nu. 67(Latest exchange rate).
 The details and price quotation of the machineries has been attached.
11.2 RAW MATERIALS
All the raw materials will be purchased from Hebei Yuyin Trade Co. Ltd based in china.
PARTICULARS
PET Granules for bottle (per ton)
PP Granules for Caps (per ton)
UNIT COST (USD)
1,000
1,040
UNIT COST (NU)
67,000
70,216
Note: PET granules and PP granules are the main raw material for the production of the bottles and
caps. We will purchase the raw material as per the requirement depending on the production
capacity of the machine.
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2016
12 PRODUCTION PROCESS
12.1 The process of making PET bottles
1. Drying the PET: PET absorbs moisture from the atmosphere. This must be removed
before processing using a dehumidifying drier.
2. Plasticizing the PET: Dried PET Pellets are compressed and melted by a rotating
injection Screw.
3. Injection molding the Preform: Molten PET is injected into an injection cavity and
cooled rapidly to form a "Preform". (The Original test-tube-like form, from which
bottles are blown is known as a Preform).
4. Optimizing the Preform Temperature: The temperature of the preform is adjusted
to the correct profile for blowing.
5. Stretch blow molding the container: The hot Preform is simultaneously stretched
and blown (thereby, orienting the crystals of and strengthening the PET) into a
shaped blow mold to form a tough, lightweight container.
6. Container ejection: The finished container is ejected.
12.2 The process of making PP bottle caps
1. Drying the PP: PP absorbs moisture from the atmosphere. This must be removed
before processing using a dehumidifying drier.
2. Plasticizing the PP: Dried PP Pellets are compressed and melted by a rotating
injection Screw.
3. Injection molding the Cap: Molten PP is injected into an injection cavity and cooled
rapidly to form a "cap".
4. Slitting the Caps: Slitting of molded caps by slitting machine.
5. Cap ejection: The finished caps is ejected.
The process needs to be done semi-automatically. The supplier will send engineer for
installation, from setting machine, testing, and to check the machine is on the good working
condition and provide whole drawing for the preform mold and cap mold.
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2016
13 SAFETY MEASURES IN THE WORKPLACE
13.1 SAFETY MEASURES FOR LABOR
 Before operating a machine, ensure that the dangerous part of the machine has been
installed with a guard.
 Keep vigilant all the time and watch out for working machines and equipment.
 Before using any electrical installation or tool, check the condition of its electric
cables.
 Avoid dragging electric cables on the ground or allowing the cables to come into
contact with water.
 Use electrical tools installed with an earth leakage circuit breaker.
13.2





PERSONAL SAFETY
Wear protective equipment.
Do not drink or take drugs while working.
Pay attention to personal hygiene.
Do not play in the workplace.
Report to supervisor immediately if anybody notice any unsafe condition
13.3




NOISE
Wear ear protectors in areas with high noise levels.
Properly wear ear protectors according to the manufacturer's instructions.
Do not reuse disposable ear plugs.
Clean ear protectors regularly.
13.4 PERSONAL PROTECTIVE EQUIPMENT
 For own safety and interest, personal protective equipment will be provided
 Will be provided gloves while handling or contacting with machines though the
machine is safe
 Wear eye and ear protectors whenever necessary.
13.5 FIRST AID
 If you sustain an injury or feel not well while at work, even if it is minor, go to the first
aid room right away for medical treatment and notify your supervisor.
 Put the case on record
15
2016
14 FORECAST
14.1 PRODUCTION CAPACITY
PRODUCTION CAPACITY PROJECTION
Particular
Daily
Month
Year 1
Year 2
Year 3
Year 4
Year 5
500ml PET Bottle (Pcs)
4,375
109,375
1,312,500
1,443,750
1,588,125
1,746,938
1,921,631
2,875
71,875
862,500
948,750
1,043,625
1,147,988
1,262,786
28 mm PP Caps (Pcs)
16,500
TOTAL PRODUCTION
412,500
4,950,000
5,445,000
5,989,500
6,588,450
7,247,295
593,750
7,125,000
7,837,500
8,621,250
9,483,375
10,431,713
Note and Assumptions:
 Production capacity has been increased by 10% from second year onwards.
 8 hours’ production in a day has been taken into consideration and 25 days working days in a month
though the working is normally 10 hours.
 Production capacity has been kept at minimum (average) from the actual production capacity of
the machine in order to avoid over estimation of the production.
 18grams and 25grams of granules can give 500ml and 1000ml bottles respectively
14.2 SALES FORECAST
SALES FORECAST
Products
Unit price (Min)
Month 1
Year 1
Year 2
Year 3
Year 4
Year 5
3.00
328,125
3,937,500
4,331,250
4,764,375
5,240,813
5,764,894
4.00
287,500
3,450,000
3,795,000
4,174,500
4,591,950
5,051,145
28 mm PP Caps (Pcs)
0.25
103,125
1,237,500
1,361,250
1,497,375
1,647,113
1,811,824
718,750
8,625,000
9,487,500
10,436,250
11,479,875
12,627,863
TOTAL SALES
Rec 10%
sales 90%
71,875
646,875
862,500
7,762,500
948,750
8,538,750
1,043,625
9,392,625
1,147,988
10,331,888
1,262,786
11,365,076
Note:
 Selling Price has been kept at minimal to avoid over estimation of sales.
 The price of the product is exclusive of the cardboard carton. The price of the bottle packed in
cardboard carton will be more than the aforementioned price.
16
2016
15 FINANCIAL PLAN
15.1 TOTAL PROJECT COST
COMPONENTS OF PROJECT COST
Amt in Nu.
PARTICULARS
Forex.
Component
Land
Site Development
Civil Works
Construction of Plant House
Total Cost
Plant and Machinery
Miscellaneous Fixed Assets
Domestic
Component
-
1,219,800
1,219,800
3,352,800
320,500
80,000
190,280
3,943,580
Transportation
Installation Cost
Total
Preliminary Expenses
Total Preliminary Expenses
Interest During Construction
Total Cost
-
Remarks
LEASE
1,219,800
3,943,580
-
TOTAL
5,163,380
Note: The cost breakdown for the construction of semi-permanent building, the labor cost and installation
cost are attached in the annexure.
17
2016
15.2 FIXED ASSETS COST
CAPITAL FIXED ASSETS WITH DEPRECIATION
PARTICULARS
Total
Plant and Machinery
Water Chiller (5P)
Crusher (XFS-300)
Cap Mold (24cavity)
Semi-automatic mould blowing machine (HY-B-I) 2
cavity:
Stretch Blow Equipment and Rotary infrared preheater
High pressure pipe
Air filter (2 nos)
Air cold dryer
Electrical Fittings
Accessories tools
Total
Sintex Water Tank (2000l)
Desktops Computer
Executive Table
Writing Table
Revolving Chair
Wooden Chair
File Rack
Printer
Telephone
Office Stationeries
Miscellaneous
Total
TOTAL NET FIXED ASSETS
18
Unit
s
1
Unit
Cost
Total
Amount
Yearly
Dep
Monthly
Dep
1,219,800
1,219,800
36,594
3,050
1,219,800
1,219,800
36,594
3,050
1,206,000
1,206,000
180,900
15,075
-
-
-
-
1
40,200
40,200
6,030
503
1
40,200
40,200
6,030
503
1
120,600
120,600
18,090
1,508
1
55,610
55,610
8,342
695
1
225,120
225,120
33,768
2,814
1
337,680
337,680
50,652
4,221
1
506,520
506,520
75,978
6,332
1
146,730
146,730
22,010
1,834
-
-
-
-
268,000
40,200
3,350
1
1
1
268,000
153,430
153,430
23,015
1,918
1
13,400
13,400
2,010
168
1
14,740
14,740
2,211
184
1
60,970
60,970
9,146
762
1
24,120
24,120
3,618
302
29,480
29,480
4,422
369
80,000
12,000
1,000
30,000
4,500
375
3,352,800
16,500
1,375
1
1
20,000
20,000
3,000
250
5
35,000
175,000
26,250
2,188
1
7,500
7,500
1,125
94
5
4,500
22,500
3,375
281
1
8,500
8,500
1,275
106
10
3,000
30,000
4,500
375
2
5,000
10,000
1,500
125
1
25,000
25,000
3,750
313
1
2,000
2,000
300
25
1
15,000
15,000
2,250
188
1
5,000
5,000
750
63
320,500
48,075
4,006
4,893,100
101,169
8,431
2016
15.3 NET VALUE OF ASSETS
NET FIXED ASSET VALUES
PARTICULARS
Total
Plant and Machinery
Water Chiller (5P)
Crusher (XFS-300)
Cap Mold (24cavity)
High pressure pipe
Air filter (2 nos)
Air cold dryer
Electrical Fittings
Accessories tools
Total
Desktops Computer
Executive Table
Writing Table
Revolving Chair
Wooden Chair
File Rack
Printer
Telephone
Office Stationeries
Miscellaneous
Total
Year 1
Year 2
Year 3
Year 4
Year 5
1,183,206
1,183,206
1,025,100
34,170
34,170
102,510
47,269
191,352
287,028
430,542
124,721
227,800
130,416
11,390
12,529
51,825
20,502
25,058
68,000
25,500
2,849,880
1,146,612
1,146,612
844,200
28,140
28,140
84,420
38,927
157,584
236,376
354,564
102,711
187,600
107,401
9,380
10,318
42,679
16,884
20,636
56,000
21,000
2,346,960
1,110,018
1,110,018
663,300
22,110
22,110
66,330
30,586
123,816
185,724
278,586
80,702
147,400
84,387
7,370
8,107
33,534
13,266
16,214
44,000
16,500
1,844,040
1,073,424
1,073,424
482,400
16,080
16,080
48,240
22,244
90,048
135,072
202,608
58,692
107,200
61,372
5,360
5,896
24,388
9,648
11,792
32,000
12,000
1,341,120
1,036,830
1,036,830
301,500
10,050
10,050
30,150
13,903
56,280
84,420
126,630
36,683
67,000
38,358
3,350
3,685
15,243
6,030
7,370
20,000
7,500
838,200
17,000
148,750
6,375
19,125
7,225
25,500
8,500
21,250
1,700
12,750
4,250
272,425
14,000
122,500
5,250
15,750
5,950
21,000
7,000
17,500
1,400
10,500
3,500
224,350
11,000
96,250
4,125
12,375
4,675
16,500
5,500
13,750
1,100
8,250
2,750
176,275
8,000
70,000
3,000
9,000
3,400
12,000
4,000
10,000
800
6,000
2,000
128,200
5,000
43,750
1,875
5,625
2,125
7,500
2,500
6,250
500
3,750
1,250
80,125
4,305,511
3,717,922
3,130,333
2,542,744
1,955,155
Note: The depreciation has been done according to the Income Tax Act of The Kingdom of Bhutan. The
permanent structure is depreciated at 3% per annum and other assets at 15% per annum.
19
2016
15.4 INVENTORY COST PROJECTION
Daily
(kg)
Approx.
120
15
250nos
UNIT
COST
PARTICULARS
Cardboard Carton (pcs)
Miscellaneous
67,000
70,216
7
MONTHLY
REQUIRED (kg)
MONTHLY COST
3,000
375
6,250nos
TOTAL
201,000
26,331
43,750
5,000
276,081
YEAR 1
YEAR 2
YEAR 3
YEAR 4
YEAR 5
Miscellaneous
2,412,000
315,972
525,000
60,000
2,653,200
347,569
577,500
66,000
2,918,520
382,326
635,250
72,600
3,210,372
420,559
698,775
79,860
3,531,409
462,615
768,653
87,846
TOTAL
3,312,972
3,644,269
4,008,696
4,409,566
4,850,522
PARTICULARS
Note:



Inventory has been increased by 10% from second year onwards.
Only 25 working days has been considered for the production in each month.
Raw materials will be purchased from suppliers based in China, Hebei Yuyin Trade Co.
Ltd in China as per the requirements.
15.5 MANPOWER COST
PARTICULARS
General Manager
Production Manager
Purchase Officer
Accountant
Supervisor
TOTAL
20
1
1
1
1
1
4
2
1
MONTHLY
20,000
11,000
9,000
9,000
7,000
24,000
12,000
5,000
5,000
YEAR 1
240,000
132,000
108,000
108,000
84,000
288,000
144,000
60,000
60,000
12
102,000
1,224,000
Particulars
Direct Labor
Salary & Allowances
Wages
Payroll (direct &
salary)
2016
Monthly
24,000
73,000
5,000
Year 1
288,000
876,000
60,000
Year 2
302,400
919,800
63,000
Year 3
317,520
965,790
66,150
Year 4
333,396
1,014,080
69,458
Year 5
366,736
1,115,487
76,403
97,000
1,164,000
1,222,200
1,283,310
1,347,476
1,482,223
Note:
 Inflation rate of 5% in the second, third and fourth year and 10% in the fifth year has been
considered in the manpower cost annually.
 Part-time labour and others will be given wages as per the work assigned.
15.6 LOAN PAYMENT FOR FIVE YEARS
PARTICULAR
INTEREST
PRINCIPLE
END VALUE
MONTHLY
13940
70129
310278
YEAR1
167,278
841,553
3,723,331
YEAR2
132,992
875,840
2,847,491
YEAR3
97,309
911,523
1,935,969
YEAR4
60,172
948,659
987,309
YEAR5
21,522
987,309
-
16 TOTAL OPERATIONAL EXPENDITURE PROJECTION
PARTICULARS
MONTHLY COST
YEAR 1
YEAR 2
YEAR 3
YEAR 4
YEAR 5
Advertising
3,000
36,000
36,000
36,000
36,000
36,000
Bank Charges
Credit card fees
Delivery expenses
5,000
60,000
66,000
72,600
79,860
87,846
Health insurance
Insurance
3,500
42,000
42,000
42,000
42,000
42,000
Interest
13,940
167,278
132,992
97,309
60,172
21,522
Inventory purchases
276,081
3,312,972 3,644,269 4,008,696 4,409,566 4,850,522
Miscellaneous
2,000
24,000
26,400
29,040
31,944
35,138
Office expenses
Payroll
97,000
1,164,000 1,222,200 1,283,310 1,347,476 1,482,223
Payroll taxes
Professional fees
5,000
60,000
66,000
72,600
79,860
87,846
Rent or lease
9,075
108,900
119,790
131,769
144,946
159,440
Subscriptions & dues
Supplies
Taxes and licenses
4,500
909,804 1,043,424 1,190,894 1,353,630 1,511,935
7,500
90,000
99,000
108,900
119,790
131,769
Others
46,000
552,000
592,200
635,670
682,700
737,078
Loan Principle
70,129
841,553
875,840
911,523
948,659
987,309
TOTAL
542,725
7,368,508 7,966,115 8,620,311 9,336,602 10,170,630
21
MONTHLY COST
Others:
Amortization
Bad debts
Commissions
5,000
Maintenance
3,000
Postage
Property taxes
Repairs
3,000
Travel
Vehicle expense
Freight-in
10,000
Indirect Expenses (electricity)
20,000
Wages
5,000
Total
46,000
2016
YEAR 1
YEAR 2
YEAR 3
YEAR 4
YEAR 5
60,000
36,000
66,000
39,600
72,600
43,560
79,860
47,916
87,846
52,708
36,000
120,000
240,000
60,000
552,000
39,600
132,000
252,000
63,000
592,200
43,560
145,200
264,600
66,150
635,670
47,916
159,720
277,830
69,458
682,700
52,708
175,692
291,722
76,403
737,078
Note:
 Electricity has been assumed to be increasing by 5% every year, advertisement at constant and
remaining expenses at 10% every year.
17 FINANCIAL ANALYSIS
17.1 PROJECTED INCOME STATEMENT
INCOME STATETMENT PROJECTION FOR 5 YEARS
Revenue
Cost of Goods Sold
Gross Profit
Expenses
Net Operating Income
Net Income (Loss)
Less:
30% BIT
Net Profit (Loss)
Additional Information
Depreciation expenses
% of Net Income (Loss)
% of Average Net Income (Loss)
% of Net Profit (Loss)
% of Average Net Profit
Monthly Taxes Payable (30% BIT)
22
YEAR 1
8,625,000
3,960,972
4,664,028
YEAR 2
9,487,500
4,330,669
5,156,831
YEAR 3
10,436,250
4,736,016
5,700,234
YEAR 4
11,479,875
5,180,512
6,299,363
YEAR 5
12,627,863
5,684,671
6,943,191
1,811,347
2,852,681
1,876,751
3,280,080
1,948,387
3,751,847
2,026,844
4,272,519
2,166,944
4,776,247
2,852,681
3,280,080
3,751,847
4,272,519
4,776,247
855,804
1,996,877
984,024
2,296,056
1,125,554
2,626,293
1,281,756
2,990,764
1,432,874
3,343,373
101,169
11.01
11.01
101,169
14.98
101,169
14.38
101,169
13.88
101,169
11.79
14.98
14.38
13.88
11.79
71,317
82,002
93,796
106,813
119,406
2016
17.2 PROJECTED CASH FLOW STATEMENT
Projected Cash Flow Statement
Beginning Cash Balance
Accts. Rec. Collections
Year 1
Year 2
Year 3
Year 4
Year 5
1,141,221
1,799,217
3,320,603
5,136,542
7,279,815
862,500
948,750
1,043,625
1,147,988
1,262,786
8,538,750
9,392,625
10,331,888
11,365,076
13,189,884
9,487,500
10,436,250
11,479,875
12,627,863
14,331,105
11,286,717
13,756,853
16,616,417
19,907,678
36,000
36,000
36,000
36,000
36,000
-
-
-
-
-
60,000
66,000
72,600
79,860
87,846
Loan Proceeds
4,564,884
Sales & Receipts
7,762,500
Other:
Total Cash Inflows
Available Cash Balance
Advertising
Bank Service Charges
Credit Card Fees
Delivery
Health Insurance
Insurance
42,000
42,000
42,000
42,000
42,000
Interest
167,278
132,992
97,309
60,172
21,522
3,312,972
3,644,269
4,008,696
4,409,566
4,850,522
Inventory Purchases
Miscellaneous
24,000
26,400
29,040
31,944
35,138
Office
-
-
-
-
-
Payroll
1,164,000
1,222,200
1,283,310
1,347,476
1,482,223
Professional Fees
60,000
66,000
72,600
79,860
87,846
Rent or Lease
108,900
119,790
131,769
144,946
159,440
Taxes & Licenses
909,804
1,043,424
1,190,894
1,353,630
1,511,935
Utilities & Telephone
90,000
99,000
108,900
119,790
131,769
Payroll Taxes
Subscriptions & Dues
Supplies
Other:
Other Cash Out Flows:
552,000
592,200
635,670
682,700
737,078
Subtotal
6,526,954
7,090,275
7,708,788
8,387,942
9,183,321
Capital Purchases
5,163,380
875,840
911,523
948,659
987,309
Loan Principal
841,553
Owner's Draw
Other:
Ending Cash Balance
23
Subtotal
6,004,933
875,840
911,523
948,659
987,309
Total Cash Outflows
12,531,888
7,966,115
8,620,311
9,336,602
10,170,630
1,799,217
3,320,603
5,136,542
7,279,815
9,737,048
2016
17.3 PROJECTED BALANCE SHEET STATEMENT
Projected Balance Sheet For 5 Years
Year 1
Year 2
Year 3
Year 4
Year 5
Assets
Cash
Accounts Receivable
Inventory
Prepaid expenses
Other Current Assets
Total Current Assets
Net Fixed Assets
Other Assets
Total Assets
Liabilities & Capital
Accounts Payable
Taxes Payable
Payroll Taxes Payable
Accrued Wages Payable
Unearned Revenue
Short-Term Notes Payable
Short-Term Bank Loan Payable
Total Current Liabilities
Long-Term Notes Payable
Total Long-Term Liabilities
Total Liabilities
Owner's Equity
Net Profit
Total Capital
Total Liabilities & Capital
1,799,217
862,500
270,280
3,320,603
948,750
-
5,136,542
1,043,625
-
7,279,815
1,147,988
-
9,737,048
1,262,786
-
2,931,997
4,305,511
4,269,353
3,717,922
6,180,167
3,130,333
8,427,803
2,542,744
10,999,834
1,955,155
7,237,508
7,987,275
9,310,500
10,970,547
12,954,989
(479,724)
855,804
718,483
984,024
2,481,463
1,125,554
4,569,497
1,281,756
7,037,521
1,432,874
376,080
3,723,331
3,723,331
4,099,411
1,141,221
1,996,877
3,138,098
7,237,509
1,702,507
2,847,491
2,847,491
4,549,998
1,141,221
2,296,056
3,437,277
7,987,275
3,607,017
1,935,969
1,935,969
5,542,986
1,141,221
2,626,293
3,767,514
9,310,500
5,851,253
987,309
987,309
6,838,562
1,141,221
2,990,764
4,131,985
10,970,547
8,470,395
0
0
8,470,395
1,141,221
3,343,373
4,484,594
12,954,989
Year 3
8,620,311
4,008,696
53
Year 4
9,336,602
4,409,566
53
Year 5
10,170,630
4,850,522
52
UNIT COST OF PRODUCTION
Year 1
Year 2
Year 3
7,125,000 7,837,500 8,621,250
7,368,508 7,966,115 8,620,311
1.03
1.02
1.00
Year 4
9,483,375
9,336,602
0.98
Year 5
10,431,713
10,170,630
0.97
17.4 VALUE ADDITION & UNIT COST OF PRODUCTION
Cost of production
Raw materials cost
Value addition
Monthly
542,725
276,081
49
Total units
Cost of production
Unit cost of production
Monthly
593,750
542,725
0.91
24
VALUE ADDITION
Year 1
Year 2
7,368,508 7,966,115
3,312,972 3,644,269
55
54
2016
17.5 RETURN ON INVESTMENT AND EQUITY
YEAR
TOTAL SALES
INVESTMENT
ROI %
EQUITY
ROE %
RETURN ON INVESTMENT AND EQUITY
2
3
4
8,625,000
9,487,500
10,436,250
5,706,105
5,706,105
5,706,105
51%
66%
83%
718,400
718,400
718,400
1101%
1221%
1353%
1
5,706,105
-100%
718,400
-100%
5
11,479,875
5,706,105
101%
718,400
1498%
6
12,627,863
5,706,105
121%
718,400
1658%
17.6 COST DATA ANALYSIS
Cost Data Entry Table
Cost Element
Sl.no
1 Machinery and plant cost
2 Startup cost (civil works and others)
3 Total expenditures
Total cost by year
2016
2017
2018
2019
2020
2021
7,368,508
7,966,115
8,620,311
9,336,602
10,170,630
7,368,508
7,966,115
8,620,311
9,336,602
10,170,630
5,163,380
542,725
5,706,105
Grand total cost
49,168,270
17.7 COST BENEFIT ANALYSIS
Sl.no
1
2
3
Cost Benefit Analysis
2017
2018
3,937,500
4,331,250
3,450,000
3,795,000
1,237,500
1,361,250
8,625,000
9,487,500
Benefit Sources
2016
0
28 mm PP Caps (Pcs)
Total Benefit per year
0
Grand total benefit
2019
4,764,375
4,174,500
1,497,375
10,436,250
2020
5,240,813
4,591,950
1,647,113
11,479,875
2021
5,764,894
5,051,145
1,811,824
12,627,863
52,656,488
2019
2020
2021
(8620311)
10436250
1815939
(9336602)
11479875
2143273
(10170630)
12627863
2457232
Result calculation table
2017
2018
2016
Sl no
1
2
3
Undiscounted flows
Cost
Benefit
Net Cash Flows
(5706105)
0
(5706105)
(7368508)
8625000
1256492
(7966115)
9487500
1521385
17.8 NET PRESENT VALUE (NPV) and INTERNAL RATE OF RETURN (IRR)
Net Present Value (NPV)
Internal Rate of Return (IRR)
1,047,479
16%
17.9 PAY BACK PERIOD
Net Cash flow
Accumulated cash flow
Payback period
25
0
(5,706,105)
(5,706,105)
1
1,256,492
(4,449,613)
2
3
4
1,521,385
1,815,939
2,143,273
(2,928,227) (1,112,288)
1,030,985
3 Years and 6 months
5
2,457,232
3,488,218
2016
17.10 BREAK EVEN ANALYSIS
Unit increment
Unit start
-
Unit price
5,000,000
Sales
Variable cost
6,052,632
12,105,263
18,157,895
24,210,526
30,263,158
36,315,789
42,368,421
48,421,053
54,473,684
60,526,316
66,578,947
5,170,883
10,341,765
15,512,648
20,683,530
25,854,413
31,025,296
36,196,178
41,367,061
46,537,943
51,708,826
56,879,709
BREAK EVEN X
27,746,559
Unit cost variable
1
Contribution
margin
881,749
1,763,498
2,645,247
3,526,996
4,408,745
5,290,494
6,172,243
7,053,992
7,935,741
8,817,490
9,699,239
Total fixed costs
1
4,893,100
Fixed cost
Total cost
Net income
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
10,063,983
15,234,865
20,405,748
25,576,630
30,747,513
35,918,396
41,089,278
46,260,161
51,431,043
56,601,926
61,772,809
(4,893,100)
277,783
5,448,665
10,619,548
15,790,430
20,961,313
26,132,196
31,303,078
36,473,961
41,644,843
46,815,726
51,986,609
BREAK EVEN Y
33,587,940
LABEL
break even unit =27746559
BREAK EVEN ANALYSIS
Sales
Fixed cost
Total cost
70,000,000
60,000,000
50,000,000
40,000,000
30,000,000
20,000,000
10,000,000
-
26
10,000,000
20,000,000
30,000,000
Units
40,000,000
50,000,000
60,000,000
2016
18 CONCLUSION
Plastic Bottles and Caps Manufacturing Unit is a commercial production unit to be
established at Industrial Estate under Phuntsholing Dzongkhag which requires a financial
investment worth of BTN 5,706,105 with debt equity ratio of 4:1.
With this business, it’s expected to curb an outflow of INR and cashing in on the foreign
currency in the initial years in its own small ways. But the effect will be more in the future
with its expansion and diversification of the products which will also create more
employment opportunities.
Though the proposed business has projected the production for five years, it plans on
producing more than the actual production. The production shown in the projection is kept
at very minimal level. The machines have high production capacity.
As a forward-looking company and as a socially responsible firm, we would bring about
benefits to the local community and our customers. We will create employment to around
12 qualified Bhutanese people and contribute to the nation’s economy in the form of taxes.
The enterprise will give satisfaction salary and allowances with commission to the
employees as they are bedrock of our business and our success depends on the level of
satisfaction they derive working in the business house.
The business house will accord top priority to our customers and deliver high quality and
timely services, and products. Through an expansive marketing strategy PBCMU will create
a unique brand for itself.
The enterprise would earn profit of 11.01% on an average. It is assured and guaranteed that
the enterprise would make more profit once it starts production and marketing than as it is
aforementioned.
The proposed business is feasible due to its strategic investment and operational planswhereby 86% of the total investment is invested in fixed asset and its working capital
constitutes only 6.29% of the total sales in the first financial year.
27
2016
19 ANNEXURES
19.1 Breakdown Cost for Construction of Plant House and Labour Cost
Construction Cost for Plant House (Semi-Permanent)
Particulars
Units Requirement Unit Cost Amount
CGI Sheet 10ft(in no)
120
915
109,800
Timber (in cft)
500
500
250,000
Sand (in truck)
10
15,000
150,000
Stone (in truck)
12
15,000
180,000
Cement (in bags)
250
300
75,000
Gravel (in truck)
5
15000
75,000
Miscellaneous cost (Paints, electrical, etc.)
80,000
Labor cost
300,000
TOTAL AMOUNT
1,219,800
Labour Cost for the Construction for Plant house
Required No. of labour
No. of Working Days Wage Per Day
10
60
500
19.2 Installation Cost break down
INSTALLATION COST
Particular
DAY
Round Ticket
6
Accommodation and Fooding
14
Allowance
14
TOTAL
USD
60
Total Wage
300,000
BTN
120,000
14,000
56,280
190,280
Note: Supplier will send engineer for installation and test the machines and have training lessons abroad, but the
rood tickets, accommodation, eating, and the allowance of 60 USD per day will be on customer’s side.
28
2016
20 PROJECT TIMELINE
PROJECT TIME LINE
Activities
2016-2017
Mar
Apr
Feasibility study and
development of the
project proposal
Approval from financial
institution
If the project is going to
be funded:
Start construction
plant house
of
Purchase of plant and
machinery and other
required materials and
installations
Recruitment of the
required
staff
and
training
Start of the production
and its sale
Note: Production will be on a regular basis.
29
May
Jun
Aug
Sept
Oct
Nov
Dec
Jan
Feb
Mar
2016
21 FINANCIAL INSTITUTION (FINANCIAL PLANS AND ANALYSIS)
PRODUCTION CAPACITY
PRODUCTION CAPACITY PROJECTION
Particular
Daily
Month
Year 1
Year 2
Year 3
Year 4
Year 5
4,375
109,375
1,312,500
1,443,750
1,588,125
1,746,938
1,921,631
2,875
71,875
862,500
948,750
1,043,625
1,147,988
1,262,786
28 mm PP Caps (Pcs)
16,500
412,500
4,950,000
5,445,000
5,989,500
6,588,450
7,247,295
593,750
7,125,000
7,837,500
8,621,250
9,483,375
10,431,713
TOTAL PRODUCTION
SALES FORECAST
SALES FORECAST
Products
Unit price (Min)
Month 1
Year 1
Year 2
Year 3
Year 4
Year 5
3.00
328,125
3,937,500
4,331,250
4,764,375
5,240,813
5,764,894
4.00
287,500
3,450,000
3,795,000
4,174,500
4,591,950
5,051,145
28 mm PP Caps (Pcs)
0.25
103,125
1,237,500
1,361,250
1,497,375
1,647,113
1,811,824
718,750
8,625,000
9,487,500
10,436,250
11,479,875
12,627,863
TOTAL SALES
Rec 10%
sales 90%
30
71,875
646,875
862,500
7,762,500
948,750
8,538,750
1,043,625
9,392,625
1,147,988
10,331,888
1,262,786
11,365,076
2016
TOTAL PROJECT COST
Amt in Nu.
PARTICULARS
Forex.
Component
Land
Site Development
Civil Works
Domestic
Component
-
Total Cost
-
1,219,800
Total Cost
Plant and Machinery
1,219,800
Installation Cost
1,219,800
3,352,800
320,500
80,000
190,280
Total
3,943,580
3,943,580
Transportation
-
TOTAL
31
5,163,380
Remarks
LEASE
2016
FIXED ASSETS COST
PARTICULARS
Total
Plant and Machinery
Water Chiller (5P)
Crusher (XFS-300)
Cap Mold (24cavity)
cavity:
High pressure pipe
Air filter (2 nos)
Air cold dryer
Electrical Fittings
Accessories tools
Total
Desktops Computer
Executive Table
Writing Table
Revolving Chair
Wooden Chair
File Rack
Printer
Telephone
Office Stationeries
Miscellaneous
Total
32
Unit
s
1
Unit
Cost
Total
Amount
Yearly
Dep
Monthly
Dep
1,219,800
1,219,800
36,594
3,050
1,219,800
1,219,800
36,594
3,050
1
1,206,000
1,206,000
180,900
15,075
-
-
-
-
1
40,200
40,200
6,030
503
1
40,200
40,200
6,030
503
1
120,600
120,600
18,090
1,508
1
55,610
55,610
8,342
695
1
225,120
225,120
33,768
2,814
1
337,680
337,680
50,652
4,221
1
506,520
506,520
75,978
6,332
1
146,730
146,730
22,010
1,834
-
-
-
-
268,000
40,200
3,350
1
268,000
1
153,430
153,430
23,015
1,918
1
13,400
13,400
2,010
168
1
14,740
14,740
2,211
184
1
60,970
60,970
9,146
762
1
24,120
24,120
3,618
302
1
29,480
29,480
4,422
369
80,000
12,000
1,000
30,000
4,500
375
3,352,800
16,500
1,375
1
20,000
20,000
3,000
250
5
35,000
175,000
26,250
2,188
1
7,500
7,500
1,125
94
5
4,500
22,500
3,375
281
1
8,500
8,500
1,275
106
10
3,000
30,000
4,500
375
2
5,000
10,000
1,500
125
1
25,000
25,000
3,750
313
1
2,000
2,000
300
25
1
15,000
15,000
2,250
188
1
5,000
5,000
750
63
320,500
48,075
4,006
4,893,100
101,169
8,431
2016
NET VALUE OF ASSETS
NET FIXED ASSET VALUES
PARTICULARS
Total
Plant and Machinery
Water Chiller (5P)
Crusher (XFS-300)
Cap Mold (24cavity)
High pressure pipe
Air filter (2 nos)
Air cold dryer
Electrical Fittings
Accessories tools
Total
Desktops Computer
Executive Table
Writing Table
Revolving Chair
Wooden Chair
File Rack
Printer
Telephone
Office Stationeries
Miscellaneous
Total
33
Year 1
Year 2
Year 3
Year 4
Year 5
1,183,206
1,183,206
1,025,100
34,170
34,170
102,510
47,269
191,352
287,028
430,542
124,721
227,800
130,416
11,390
12,529
51,825
20,502
25,058
68,000
25,500
2,849,880
1,146,612
1,146,612
844,200
28,140
28,140
84,420
38,927
157,584
236,376
354,564
102,711
187,600
107,401
9,380
10,318
42,679
16,884
20,636
56,000
21,000
2,346,960
1,110,018
1,110,018
663,300
22,110
22,110
66,330
30,586
123,816
185,724
278,586
80,702
147,400
84,387
7,370
8,107
33,534
13,266
16,214
44,000
16,500
1,844,040
1,073,424
1,073,424
482,400
16,080
16,080
48,240
22,244
90,048
135,072
202,608
58,692
107,200
61,372
5,360
5,896
24,388
9,648
11,792
32,000
12,000
1,341,120
1,036,830
1,036,830
301,500
10,050
10,050
30,150
13,903
56,280
84,420
126,630
36,683
67,000
38,358
3,350
3,685
15,243
6,030
7,370
20,000
7,500
838,200
17,000
148,750
6,375
19,125
7,225
25,500
8,500
21,250
1,700
12,750
4,250
272,425
4,305,511
14,000
122,500
5,250
15,750
5,950
21,000
7,000
17,500
1,400
10,500
3,500
224,350
3,717,922
11,000
96,250
4,125
12,375
4,675
16,500
5,500
13,750
1,100
8,250
2,750
176,275
3,130,333
8,000
70,000
3,000
9,000
3,400
12,000
4,000
10,000
800
6,000
2,000
128,200
2,542,744
5,000
43,750
1,875
5,625
2,125
7,500
2,500
6,250
500
3,750
1,250
80,125
1,955,155
2016
INVENTORY COST PROJECTION
Daily
(kg)
Approx.
120
15
250nos
UNIT
COST
PARTICULARS
Miscellaneous
67,000
70,216
7
MONTHLY
REQUIRED (kg)
MONTHLY COST
3,000
375
6,250nos
TOTAL
201,000
26,331
43,750
5,000
276,081
YEAR 1
YEAR 2
YEAR 3
YEAR 4
YEAR 5
Miscellaneous
2,412,000
315,972
525,000
60,000
2,653,200
347,569
577,500
66,000
2,918,520
382,326
635,250
72,600
3,210,372
420,559
698,775
79,860
3,531,409
462,615
768,653
87,846
TOTAL
3,312,972
3,644,269
4,008,696
4,409,566
4,850,522
PARTICULARS
MANPOWER COST
PARTICULARS
General Manager
Production Manager
Purchase Officer
Accountant
Supervisor
1
1
1
1
1
4
2
1
MONTHLY
20,000
11,000
9,000
9,000
7,000
24,000
12,000
5,000
5,000
YEAR 1
240,000
132,000
108,000
108,000
84,000
288,000
144,000
60,000
60,000
12
102,000
1,224,000
TOTAL
Particulars
Direct Labor
Salary & Allowances
Wages
Payroll (direct &
salary)
34
Monthly
24,000
73,000
5,000
Year 1
288,000
876,000
60,000
Year 2
302,400
919,800
63,000
Year 3
317,520
965,790
66,150
Year 4
333,396
1,014,080
69,458
Year 5
366,736
1,115,487
76,403
97,000
1,164,000
1,222,200
1,283,310
1,347,476
1,482,223
2016
LOAN PAYMENT
INTEREST
PRINCIPLE
END VALUE
MONTHLY
40378
50614
282646
YEAR1
484,541
607,366
3,391,754
YEAR2
400,705
691,202
2,700,552
YEAR3
305,297
786,610
1,913,941
YEAR4
196,719
895,188
1,018,753
YEAR5
73,154
1,018,753
(0)
TOTAL OPERATIONAL EXPENDITURE PROJECTION
PARTICULARS
MONTLY COST
YEAR 1
YEAR 2
Advertising
3,000
36,000
36,000
Bank Charges
Credit card fees
Delivery expenses
5,000
60,000
66,000
Health insurance
Insurance
3,500
42,000
42,000
Interest
40,378
484,541
400,705
Inventory purchases
276,081
3,312,972 3,644,269
Miscellaneous
2,000
24,000
26,400
Office expenses
Payroll
97,000
1,164,000 1,222,200
Payroll taxes
Professional fees
5,000
60,000
66,000
Rent or lease
9,075
108,900
119,790
Supplies
Taxes and licenses
4,500
814,625
963,110
7,500
90,000
99,000
Others
46,000
552,000
592,200
Loan Principle
50,614
607,366
691,202
Total Expenses
549,648
7,356,404 7,968,876
Others:
Amortization
Bad debts
Commissions
Maintenance
Postage
Property taxes
Repairs
Travel
Vehicle expense
Freight-in
Wages
Total
35
YEAR 3
36,000
72,600
YEAR 4
36,000
79,860
YEAR 5
36,000
87,846
42,000
305,297
4,008,696
29,040
1,283,310
42,000
196,719
4,409,566
31,944
1,347,476
42,000
73,154
4,850,522
35,138
1,482,223
72,600
131,769
79,860
144,946
87,846
159,440
1,128,498
108,900
635,670
786,610
8,640,990
1,312,666 1,496,446
119,790
131,769
682,700
737,078
895,188
1,018,753
9,378,713 10,238,216
MONTHLY COST
YEAR 1
YEAR 2
YEAR 3
YEAR 4
YEAR 5
5,000
3,000
60,000
36,000
66,000
39,600
72,600
43,560
79,860
47,916
87,846
52,708
3,000
10,000
20,000
5,000
46,000
36,000
120,000
240,000
60,000
552,000
39,600
132,000
252,000
63,000
592,200
43,560
145,200
264,600
66,150
635,670
47,916
159,720
277,830
69,458
682,700
52,708
175,692
291,722
76,403
737,078
2016
INCOME STATEMENT
INCOME STATETMENT PROJECTION FOR 5 YEARS
YEAR 1
YEAR 2
YEAR 3
YEAR 4
YEAR 5
Revenue
8,625,000
9,487,500
10,436,250
11,479,875
12,627,863
Cost of Goods Sold
3,960,972
4,330,669
4,736,016
5,180,512
5,684,671
Gross Profit
4,664,028
5,156,831
5,700,234
6,299,363
6,943,191
Expenses
2,128,610
2,144,464
2,156,375
2,163,391
2,218,576
2,535,418
3,012,367
3,543,859
4,135,972
4,724,615
Net Income (Loss)
2,535,418
3,012,367
3,543,859
4,135,972
4,724,615
30% BIT
760,625
903,710
1,063,158
1,240,792
1,417,384
Net Profit (Loss)
1,774,792
2,108,657
2,480,701
2,895,181
3,307,230
101,169
101,169
101,169
101,169
101,169
-
18.81
17.64
16.71
14.23
13.48
-
18.81
17.64
16.71
14.23
13.48
63,385
75,309
88,596
103,399
118,115
Less:
36
2016
PROJECTED CASH FLOW STATEMENT
Projected Cash Flow Statement
Year 1
Year 2
Year 3
Year 4
Year 5
1,713,908
1,818,244
3,336,867
5,132,127
7,233,289
Accts. Rec. Collections
862,500
948,750
1,043,625
1,147,988
1,262,786
Loan Proceeds
3,999,120
Sales & Receipts
7,762,500
8,538,750
9,392,625
10,331,888
11,365,076
12,624,120
9,487,500
10,436,250
11,479,875
12,627,863
14,338,028
11,305,744
13,773,117
16,612,002
19,861,151
Advertising
36,000
36,000
36,000
36,000
36,000
Bank Service Charges
-
-
-
-
-
60,000
66,000
72,600
79,860
87,846
Insurance
42,000
42,000
42,000
42,000
42,000
Interest
484,541
400,705
305,297
196,719
73,154
Inventory Purchases
3,312,972
3,644,269
4,008,696
4,409,566
4,850,522
Miscellaneous
24,000
26,400
29,040
31,944
35,138
Beginning Cash Balance
Other:
Total Cash Inflows
Available Cash Balance
Credit Card Fees
Delivery
Health Insurance
Office
-
-
-
-
-
Payroll
1,164,000
1,222,200
1,283,310
1,347,476
1,482,223
Professional Fees
60,000
66,000
72,600
79,860
87,846
Rent or Lease
108,900
119,790
131,769
144,946
159,440
Payroll Taxes
Subscriptions & Dues
Supplies
Other Cash Out Flows:
Taxes & Licenses
814,625
963,110
1,128,498
1,312,666
1,496,446
Utilities & Telephone
90,000
99,000
108,900
119,790
131,769
Other:
552,000
592,200
635,670
682,700
737,078
Subtotal
6,749,039
7,277,674
7,854,380
8,483,525
9,219,463
Capital Purchases
5,163,380
Loan Principal
607,366
691,202
786,610
895,188
1,018,753
Subtotal
5,770,746
691,202
786,610
895,188
1,018,753
Total Cash Outflows
12,519,784
7,968,876
8,640,990
9,378,713
10,238,216
1,818,244
3,336,867
5,132,127
7,233,289
9,622,935
Owner's Draw
Other:
Ending Cash Balance
37
2016
BALANCE SHEET PROJECTION
Projected Balance Sheet For 5 Years
Year 1
Year 2
Year 3
Assets
Cash
Accounts Receivable
Inventory
Prepaid expenses
Net Fixed Assets
Other Assets
Total Assets
Year 4
Year 5
1,818,244
862,500
270,280
3,336,867
948,750
-
5,132,127
1,043,625
-
7,233,289
1,147,988
-
9,622,935
1,262,786
-
2,951,024
4,305,511
4,285,617
3,717,922
6,175,752
3,130,333
8,381,276
2,542,744
10,885,721
1,955,155
7,256,535
8,003,539
9,306,085
10,924,020
12,840,876
576,712
903,710
2,134,376
1,063,158
4,055,386
1,240,792
6,402,353
1,417,384
1,480,422
2,700,552
2,700,552
4,180,974
1,713,908
2,108,657
3,822,565
8,003,539
3,197,534
1,913,941
1,913,941
5,111,475
1,713,908
2,480,701
4,194,610
9,306,085
5,296,178
1,018,753
1,018,753
6,314,931
1,713,908
2,895,181
4,609,089
10,924,020
7,819,737
(0)
(0)
7,819,737
1,713,908
3,307,230
5,021,139
12,840,876
Year 3
8,640,990
4,008,696
54
Year 4
9,378,713
4,409,566
53
Year 5
10,238,216
4,850,522
53
Monthly
Year 1
Year 2
Year 3
593,750
7,125,000 7,837,500 8,621,250
549,648
7,356,404 7,968,876 8,640,990
0.93
1.03
1.02
1.00
Year 4
9,483,375
9,378,713
0.99
Year 5
10,431,713
10,238,216
0.98
Accounts Payable
(384,545)
Taxes Payable
760,625
Unearned Revenue
376,080
3,391,754
3,391,754
Total Liabilities
3,767,834
Owner's Equity
1,713,908
Net Profit
1,774,792
Total Capital
3,488,701
7,256,535
VALUE ADDITION AND UNIT COST OF PRODUCTION
Cost of production
Raw materials cost
Value addition
Total units
Cost of production
38
Monthly
549,648
276,081
50
VALUE ADDITION
Year 1
Year 2
7,356,404 7,968,876
3,312,972 3,644,269
55
54
2016
YEAR
TOTAL SALES
INVESTMENT
ROI %
EQUITY
ROE %
1
5,713,028
-100%
718,400
-100%
2
8,625,000
5,713,028
51%
718,400
1101%
3
9,487,500
5,713,028
66%
718,400
1221%
4
10,436,250
5,713,028
83%
718,400
1353%
5
11,479,875
5,713,028
101%
718,400
1498%
6
12,627,863
5,713,028
121%
718,400
1658%
COST DATA AND BENEFIT ANALYSIS
Sl no
Cost Element
2016
1
Machinery and plant cost
5,163,380
2
Startup cost (civil works and others)
549,648
3
Total expenditures
Total cost by year
5,713,028
2017
2018
2019
2020
2021
7,356,404
7,968,876
8,640,990
9,378,713
10,238,216
7,356,404
7,968,876
8,640,990
9,378,713
10,238,216
Grand total cost
49,296,228
Sl no
Benefit Sources
2016
2017
2018
2019
2020
2021
1
0
3,937,500
4,331,250
4,764,375
5,240,813
5,764,894
2
3,450,000
3,795,000
4,174,500
4,591,950
5,051,145
1,237,500
1,361,250
1,497,375
1,647,113
1,811,824
8,625,000
9,487,500
10,436,250
11,479,875
12,627,863
3
28 mm PP Caps (Pcs)
0
Grand total benefit
52,656,488
Sl no
2016
2017
2018
2019
2020
2021
Undiscounted flows
1
Cost
(5713028)
(7356404)
(7968876)
(8640990)
(9378713)
(10238216)
2
Benefit
0
8625000
9487500
10436250
11479875
12627863
3
Net Cash Flows
(5713028)
1268596
1518624
1795260
2101162
2389646
NET PRESENT VALUE AND INTERNAL RATE OF RETURN
963,011
16%
PAY BACK PERIOD
Net Cash flow
Payback period
39
0
(5,713,028)
(5,713,028)
Number of years
1
2
1,268,596
1,518,624
(4,444,432)
(2,925,809)
3
4
1,795,260
2,101,162
(1,130,549)
970,613
5
2,389,646
3,360,259
2016
BREAK EVEN ANALYSIS
Unit increment
Unit start
-
Unit price
5,000,000
Sales
Variable cost
6,052,632
12,105,263
18,157,895
24,210,526
30,263,158
36,315,789
42,368,421
48,421,053
54,473,684
60,526,316
66,578,947
5,162,389
10,324,778
15,487,167
20,649,556
25,811,945
30,974,334
36,136,724
41,299,113
46,461,502
51,623,891
56,786,280
BREAK EVEN X
27,481,838
Unit cost variable
1
Contribution
margin
890,243
1,780,485
2,670,728
3,560,970
4,451,213
5,341,455
6,231,698
7,121,940
8,012,183
8,902,425
9,792,668
Total fixed costs
1
4,893,100
Fixed cost
Total cost
Net income
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
10,055,489
15,217,878
20,380,267
25,542,656
30,705,045
35,867,434
41,029,824
46,192,213
51,354,602
56,516,991
61,679,380
(4,893,100)
269,289
5,431,678
10,594,067
15,756,456
20,918,845
26,081,234
31,243,624
36,406,013
41,568,402
46,730,791
51,893,180
BREAK EVEN Y
33,267,488
LABEL
BREAK EVEN ANALYSIS
Sales
Fixed cost
Total cost
70,000,000
60,000,000
50,000,000
40,000,000
30,000,000
20,000,000
10,000,000
-
10,000,000
20,000,000
30,000,000
Units
40,000,000
50,000,000
60,000,000
of BTN 963,011 and an internal rate of return (IRR) of 16%.
40
2016
22 LODEN (FINANCIAL PLANS AND ANALYSIS)
PRODUCTION CAPACITY
Particular
28 mm PP Caps (Pcs)
TOTAL PRODUCTION
Daily
4,375
2,875
16,500
Month
109,375
71,875
412,500
593,750
Year 1
1,312,500
862,500
4,950,000
7,125,000
Year 2
1,443,750
948,750
5,445,000
7,837,500
Year 3
1,588,125
1,043,625
5,989,500
8,621,250
SALES FORECAST
Products
28 mm PP Caps (Pcs)
Unit price (Min)
3.00
4.00
0.25
TOTAL SALES
Rec 10%
sales 90%
71,875
646,875
Month 1
328,125
287,500
103,125
Year 1
3,937,500
3,450,000
1,237,500
Year 2
4,331,250
3,795,000
1,361,250
Year 3
4,764,375
4,174,500
1,497,375
718,750
8,625,000
9,487,500
10,436,250
862,500
7,762,500
948,750
8,538,750
1,043,625
9,392,625
TOTAL PROJECT COST
Amt in Nu.
PARTICULARS
Forex.
Component
Land
Site Development
Civil Works
Total Cost
Plant and Machinery
-
1,219,800
1,219,800
3,352,800
320,500
80,000
190,280
3,943,580
Transportation
Installation Cost
Total
Total Cost
-
1,219,800
3,943,580
-
TOTAL
41
Domestic
Component
5,163,380
Remarks
LEASE
2016
FIXED ASSETS COST
PARTICULARS
Total
Plant and Machinery
Water Chiller (5P)
Crusher (XFS-300)
Cap Mold (24cavity)
cavity:
High pressure pipe
Air filter (2 nos)
Air cold dryer
Electrical Fittings
Accessories tools
Total
Desktops Computer
Executive Table
Writing Table
Revolving Chair
Wooden Chair
File Rack
Printer
Telephone
Office Stationeries
Miscellaneous
Total
42
Unit
s
1
Unit
Cost
Total
Amount
Yearly
Dep
Monthly
Dep
1,219,800
1,219,800
36,594
3,050
1,219,800
1,219,800
36,594
3,050
1
1,206,000
1,206,000
180,900
15,075
-
-
-
-
1
40,200
40,200
6,030
503
1
40,200
40,200
6,030
503
1
120,600
120,600
18,090
1,508
1
55,610
55,610
8,342
695
1
225,120
225,120
33,768
2,814
1
337,680
337,680
50,652
4,221
1
506,520
506,520
75,978
6,332
1
146,730
146,730
22,010
1,834
-
-
-
-
268,000
40,200
3,350
1
268,000
1
153,430
153,430
23,015
1,918
1
13,400
13,400
2,010
168
1
14,740
14,740
2,211
184
1
60,970
60,970
9,146
762
1
24,120
24,120
3,618
302
1
29,480
29,480
4,422
369
80,000
12,000
1,000
30,000
4,500
375
3,352,800
16,500
1,375
1
20,000
20,000
3,000
250
5
35,000
175,000
26,250
2,188
1
7,500
7,500
1,125
94
5
4,500
22,500
3,375
281
1
8,500
8,500
1,275
106
10
3,000
30,000
4,500
375
2
5,000
10,000
1,500
125
1
25,000
25,000
3,750
313
1
2,000
2,000
300
25
1
15,000
15,000
2,250
188
1
5,000
5,000
750
63
320,500
48,075
4,006
4,893,100
101,169
8,431
2016
NET VALUE OF ASSETS
PARTICULARS
Total
Plant and Machinery
Water Chiller (5P)
Crusher (XFS-300)
Cap Mold (24cavity)
High pressure pipe
Air filter (2 nos)
Air cold dryer
Electrical Fittings
Accessories tools
Total
Desktops Computer
Executive Table
Writing Table
Revolving Chair
Wooden Chair
File Rack
Printer
Telephone
Office Stationeries
Miscellaneous
Total
43
Year 1
Year 2
Year 3
1,183,206
1,183,206
1,025,100
34,170
34,170
102,510
47,269
191,352
287,028
430,542
124,721
227,800
130,416
11,390
12,529
51,825
20,502
25,058
68,000
25,500
2,849,880
1,146,612
1,146,612
844,200
28,140
28,140
84,420
38,927
157,584
236,376
354,564
102,711
187,600
107,401
9,380
10,318
42,679
16,884
20,636
56,000
21,000
2,346,960
1,110,018
1,110,018
663,300
22,110
22,110
66,330
30,586
123,816
185,724
278,586
80,702
147,400
84,387
7,370
8,107
33,534
13,266
16,214
44,000
16,500
1,844,040
17,000
148,750
6,375
19,125
7,225
25,500
8,500
21,250
1,700
12,750
4,250
272,425
4,305,511
14,000
122,500
5,250
15,750
5,950
21,000
7,000
17,500
1,400
10,500
3,500
224,350
3,717,922
11,000
96,250
4,125
12,375
4,675
16,500
5,500
13,750
1,100
8,250
2,750
176,275
3,130,333
2016
INVENTORY COST PROJECTION
UNIT
COST
PARTICULARS
Miscellaneous
67,000
70,216
7
Daily
(kg)
Approx.
120
15
250nos
MONTHLY
REQUIRED (kg)
3,000
375
6,250nos
TOTAL
MONTHLY COST
201,000
26,331
43,750
5,000
276,081
PARTICULARS
Miscellaneous
TOTAL
YEAR 1
2,412,000
315,972
525,000
60,000
YEAR 2
2,653,200
347,569
577,500
66,000
YEAR 3
2,918,520
382,326
635,250
72,600
3,312,972
3,644,269
4,008,696
MANPOWER COST
PARTICULARS
General Manager
Production Manager
Purchase Officer
Accountant
Supervisor
1
1
1
1
1
4
2
1
MONTHLY
20,000
11,000
9,000
9,000
7,000
24,000
12,000
5,000
5,000
YEAR 1
240,000
132,000
108,000
108,000
84,000
288,000
144,000
60,000
60,000
12
102,000
1,224,000
TOTAL
Particulars
Direct Labor
Salary & Allowances
Wages
Payroll (direct & salary)
44
Monthly
24,000
73,000
5,000
97,000
Year 1
288,000
876,000
60,000
1,164,000
Year 2
302,400
919,800
63,000
1,222,200
Year 3
317,520
965,790
66,150
1,283,310
2016
TOTAL OPERATIONAL EXPENDITURE PROJECTION
PARTICULARS
Advertising
Bank Charges
Credit card fees
Delivery expenses
Health insurance
Insurance
Interest
Inventory purchases
Miscellaneous
Office expenses
Payroll
Payroll taxes
Professional fees
Rent or lease
Supplies
Taxes and licenses
Others
Loan Principle
TOTAL
MONTLY COST
3,000
5,000
YEAR 1
36,000
60,000
YEAR 2
36,000
66,000
YEAR 3
36,000
72,600
3,500
276,081
2,000
97,000
42,000
3,312,972
24,000
1,164,000
42,000
3,644,269
26,400
1,222,200
42,000
4,008,696
29,040
1,283,310
5,000
9,075
60,000
108,900
66,000
119,790
72,600
131,769
4,500
7,500
46,000
458,656
959,988
90,000
552,000
6,409,860
1,083,322
99,000
592,200
6,997,181
1,220,087
108,900
635,670
7,640,672
Others:
Amortization
Bad debts
Commissions
Maintenance
Postage
Property taxes
Repairs
Travel
Vehicle expense
Freight-in
Wages
Total
45
MONTHLY COST
YEAR 1
YEAR 2
YEAR 3
5,000
3,000
60,000
36,000
66,000
39,600
72,600
43,560
3,000
10,000
20,000
5,000
46,000
36,000
120,000
240,000
60,000
552,000
39,600
132,000
252,000
63,000
592,200
43,560
145,200
264,600
66,150
635,670
2016
INCOME STATEMENT
Revenue
Cost of Goods Sold
Gross Profit
YEAR 1
8,625,000
3,960,972
4,664,028
YEAR 2
9,487,500
4,330,669
5,156,831
YEAR 3
10,436,250
4,736,016
5,700,234
Expenses
1,644,069
3,019,959
1,743,759
3,413,072
1,851,078
3,849,156
Net Income (Loss)
Less:
30% BIT
Net Profit (Loss)
3,019,959
3,413,072
3,849,156
905,988
2,113,971
1,023,922
2,389,150
1,154,747
2,694,409
101,169
9.82
101,169
13.02
101,169
12.78
9.82
13.02
12.78
75,499
85,327
96,229
YEAR 1
8,625,000
3,960,972
4,664,028
1,644,069
3,019,959
YEAR 2
9,487,500
4,330,669
5,156,831
1,743,759
3,413,072
YEAR 3
10,436,250
4,736,016
5,700,234
1,851,078
3,849,156
Net Income (Loss)
Less:
30% BIT
Net Profit (Loss)
3,019,959
3,413,072
3,849,156
905,988
2,113,971
1,023,922
2,389,150
1,154,747
2,694,409
101,169
9.82
101,169
13.02
101,169
12.78
9.82
13.02
12.78
75,499
85,327
96,229
PROJECTED CASH FLOW STATEMENT
Revenue
Cost of Goods Sold
Gross Profit
Expenses
46
2016
BALANCE SHEET PROJECTION
Year 1
Year 2
Year 3
Cash
(2,948,240)
(457,920)
2,337,658
Accounts Receivable
862,500
948,750
1,043,625
Inventory
-
-
-
Prepaid expenses
270,280
(1,815,460)
490,830
3,381,283
Net Fixed Assets
4,305,511
3,717,922
3,130,333
2,490,051
4,208,752
6,511,616
Accounts Payable
(529,908)
795,680
2,662,460
Taxes Payable
905,988
1,023,922
1,154,747
376,080
1,819,602
3,817,207
-
-
-
Total Liabilities
376,080
1,819,602
3,817,207
Owner's Equity
-
-
-
Net Profit
Total Capital
2,113,971
2,113,971
2,389,150
2,389,150
2,694,409
2,694,409
2,490,051
4,208,752
6,511,616
Assets
Other Assets
Total Assets
Unearned Revenue
VALUE ADDITION AND UNIT COST OF PRODUCTION
Cost of production
Raw materials cost
Value addition
VALUE ADDITION
Monthly
Year 1
Year 2
Year 3
458,656 6,409,860 6,997,181 7,640,672
276,081 3,312,972 3,644,269 4,008,696
40
48
48
48
Monthly
Year 1
Year 2
Year 3
Total units
593,750 7,125,000 7,837,500 8,621,250
Cost of production
458,656 6,409,860 6,997,181 7,640,672
0.77
0.90
0.89
0.89
47
2016
YEAR
TOTAL SALES
INVESTMENT
ROI %
EQUITY
ROE %
1
5,622,036
-100%
718,400
-100%
2
8,625,000
5,622,036
53%
718,400
1101%
3
9,487,500
5,622,036
69%
718,400
1221%
COST DATA AND BENEFIT ANALYSIS
Cost Element
2016
Machinery and plant cost
5,163,380
Startup cost (civil works and others)
458,656
Total expenditures
Total cost by year
5,622,036
Grand total cost
Sl no
1
2
3
2017
2018
2019
6,409,860 6,997,181
6,409,860 6,997,181
26,669,748
7,640,672
7,640,672
2017
3,937,500
3,450,000
1,237,500
8,625,000
2018
4,331,250
3,795,000
1,361,250
9,487,500
28,548,750
2019
4,764,375
4,174,500
1,497,375
10,436,250
2017
2018
2019
(6409860)
8625000
2215140
(6997181)
9487500
2490319
(7640672)
10436250
2795578
Sl no
1
2
3
Sl no
1
2
3
Benefit Sources
2016
0
28 mm PP Caps (Pcs)
0
Grand total benefit
2016
Undiscounted flows
Cost
(5622036)
Benefit
0
Net Cash Flows
(5622036)
NET PRESENT VALUE AND INTERNAL RATE OF RETURN
550,202
15%
PAY BACK PERIOD
Net Cash flow
Payback period
48
Number of years
0
1
(5,622,036)
2,215,140
(5,622,036)
(3,406,896)
2
2,490,319
(916,576)
3
2,795,578
1,879,002
2016
BREAK EVEN ANALYSIS
Unit increment
Unit start
-
Unit price
5,000,000
Sales
Variable cost
6,052,632
12,105,263
18,157,895
24,210,526
30,263,158
36,315,789
42,368,421
48,421,053
54,473,684
60,526,316
66,578,947
4,498,147
8,996,294
13,494,441
17,992,589
22,490,736
26,988,883
31,487,030
35,985,177
40,483,324
44,981,472
49,479,619
BREAK EVEN X
15,738,659
Unit cost variable
1
Contribution
margin
1,554,484
3,108,969
4,663,453
6,217,938
7,772,422
9,326,907
10,881,391
12,435,875
13,990,360
15,544,844
17,099,329
Total fixed costs
1
4,893,100
Fixed cost
Total cost
Net income
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
4,893,100
9,391,247
13,889,394
18,387,541
22,885,689
27,383,836
31,881,983
36,380,130
40,878,277
45,376,424
49,874,572
54,372,719
(4,893,100)
(394,953)
4,103,194
8,601,341
13,099,489
17,597,636
22,095,783
26,593,930
31,092,077
35,590,224
40,088,372
44,586,519
BREAK EVEN Y
19,052,061
LABEL
BREAK EVEN ANALYSIS
Sales
Fixed cost
Total cost
70,000,000
60,000,000
50,000,000
40,000,000
30,000,000
20,000,000
10,000,000
-
10,000,000
20,000,000
30,000,000
Units
40,000,000
50,000,000
60,000,000
of BTN 550,202 and an internal rate of return (IRR) of 16%.
49
50
2016

PLASTIC BOTTLES AND CAPS MANUFACTURING UNIT

Transcription

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