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Project of Rexin Bag
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INTRODUCTION Gens & Ladise bags made of Rexin are used generally by School,colege, office goers as well as by business people & house wife to carry papers, pen, pencils, tiffin box and personal belongings etc. These types of bags are also widely used by Student and servise because they need to keep a large number esential product .Gens & Ladise bags are made of rexi and pu lether. All the machines and raw materials used for its manufacture are easily available from indigenous sources and not much technology is involved in manufacturing. MARKET POTENTIAL The scope of manufacturing this item is increasing due to the growing demand of Gens & Ladise bags in cities from the increasing number of consumers. Hence, the market of Gens & Ladise bags required by the office- goers and travellers is very bright. Gens &Ladise bags industry is located mainly in Kolkata, Mumbai, Delhi, Chennai, Kanpur and Bangalore. The item has demand not only in India but also abroad. India is exporting Gens & Ladise bags and similar types of items to Bangladesh, Nepal, Middle East, Germany, Canada etc. BASIS AND PRESUMPTIONS (1) The production is based on single shift basis of 8 hours per day and 25 working days in a month i.e. 300 working days in a year.
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Transcript of Project of Rexin Bag
INTRODUCTIONGens & Ladise bags made of Rexin are used generally by School,colege, office goers as well as by business people & house wife to carry papers, pen, pencils, tiffin box and personal belongings etc. These types of bags are also widely used by Student and servise because they need to keep a large number esential product .Gens & Ladise bags are made of rexi and pu lether. All the machines and raw materials used for its manufacture are easily available from indigenous sources and not muchtechnology is involved in manufacturing.
MARKET POTENTIALThe scope of manufacturing this item is increasing due to the growing demand of Gens & Ladise bags in cities from the increasing number of consumers. Hence, the market of Gens & Ladise bags required by the office-goers and travellers is very bright. Gens &Ladise bags industry is located mainly in Kolkata, Mumbai, Delhi, Chennai, Kanpur and Bangalore. The item has demand not only in India but also abroad. India isexporting Gens & Ladise bags and similar types of items to Bangladesh, Nepal,Middle East, Germany, Canada etc.
BASIS AND PRESUMPTIONS(1) The production is based on single shift basis of 8 hours per day and 25 working days in a month i.e. 300 working days in a year.(2) The unit is expected at 60% efficiency in the first year and 90% efficiency will be achieved within 3-4 years.(3) Time period for achieving envisaged capacity utilization is 3 months after trial run.(4) Interest rate is calculated @ 15% per annum on average.(5) Payback period is 4-5 years.(6) Labour will be engaged on monthly basis, which is more than the minimum wage declared by the State Govts.(7) Considering the product and usage, the project can work for
more than 20 years.
IMPLEMENTATION SCHEDULESl. Activity PeriodNo. (in months)1. Registration and 1 other formalities2. Acquisition of 3 land and shed3. Arrangement of electricity 2 and water supply4. Machinery purchasing 4 and installation5. Trial Production 1 Total 11
TECHNICAL ASPECTSProcess of ManufactureThese articles are manufactured by different methods. However, the main operations are:1) Pattern cutting2) Economical layout of pattern3) Clicking of components4) Assembling5) Stitching6) Fitting7) Cleaning and finishing.
The components are cut as per the patterns of various sizes and designs, from the rexin or pu leather by hand after duly checking of the rexin or pu leather keeping in view holes and flaying cuts. The components are then stitched , wherever necessary. After completion of stitching, handle is fixed and stitched on the central
portion of the bag. Zips, buckles, rivets and other fittings are attached. The bags are cleaned, polished, finished and packed.
Quality Control and Standards Specific standards are to be followed as mutually agreed upon between the manufacturers and the buyers. In case of export, rigid quality control is to be maintained. The quality of product depends upon the purchase of right raw material, grinderies and strict supervision. Final inspection is a must before packing.
Production Capacity (per annum)
Quantity Rate Value (Rs.)Gens Bag 40000 @ 103 41,20,000
Portfolio Bag 50000@ 113 56,50,000
Total 97,70,000
Motive Power 5 HP. Pollution Control These types of leather goods industries do not pollute. Hence, no arrangement is necessary to check the pollution. Energy Conservation Energy conservation in
this type of unit is on the lower side since low power motors are used in the production line. The staff of the unit should be madeaware of the need to conserve energy by switching off the energy sources whennot required.
FINANCIAL ASPECTSA. Fixed Capital(i) Land and Building Amount (Rs.)Covered shed (300 sq.ft.) rented Rs 5,000rate on rent per month(ii) Machinery and EquipmentsSl. Description Total Ind. Qty. AmountNo. . (Rs.)1. Flat-bed Stitching 8 Nose @ 12,000 Rs 96,000machine2. Cylinder-bed 1 nose @ 1,00,000 Rs 1,00,000stitching machine3. Skiving machine 1 Nose @ 1 50,000 Rs 1,50,0004. Splitting machine 1 Nose @ 2,00,000 Rs 2,00,0005. Punching machine 1 Nose @ 1 20,000 Rs 1,20,0006. Roughing, Buffing 1 Nose @ 1 20,000 Rs 1,20,000 and Polishingmachine7. Cutting table for components Rs 10,000components8. Tools and Equipment L.S. Rs 50,0009. Office equipment and furniture L.S. Rs 50,000and furniture,Electrification and Installationand Installation charges @ 10%upto Sl. No. 6 - - - Rs78600
Total Rs 9,74,600
(iii) Pre-operative Expenses Rs. 49,000
Total Fixed Capital (ii+iii) Rs 10,23,600
B. Working Capital (per month)(i) Personnel (per month)Sl. Designation No. Salary TotalNo. (Rs.) (Rs.)
1. Manager 1 10,000 10,000
2. Supervisor 1 7,000 7,000
3. Cashier-cum-Accountant 1 5,000 5,000
4. Store keeper-cum-typist 1 4,000 4,000
5. Master Cutter 1 5,000 5,000
6. Machine Operators 8 4,000 32,000
7. Skilled Worker 2 4,000 8,000
8. Semi-skilled worker 2 3,000 6,0009. Helper 2 2,000 4,00010. Peon 1 2,000 2,000
11.Watchman 1 2,000 2,000
12. Sweeper 1 2,000 2,000
Total 83,000
Add. 20% perquisites 16,600
Total 99,600
(ii) Raw Material (per month)
7500 Nos. Rexin Bag.(Ledise&Gens)
Sl. Description Qty. Rate ValueNo. (Rs.)
1. Rexin / pu lether foam 3000 110 3,30,000 different colours, design mtr mtr and shade
2. Grinderies , L.S. 50 1,50,000 Lock, D-ring, per piece Zip, rivets, adhesive, thread etc.) 3. Packing L.S. 4 per piece 12,000 Total 4,92,000
(iii) Utilities (per month)Sl. Description AmountNo. (Rs.)
1. Power requirement including 4,500 lighting, fan etc.
2. Water and Fuel 500
Total 5,000
(iv) Other Contingent Expenses (per month)
Sl. Description AmountNo. (Rs.)1. Rent 5,0002. Postage and Stationery 2,0003. Telephone 2,0004. Consumable stores 2,0005. Repair and Maintenance 3,0006. Transport charges 5,0007. Advertisement and publicity 3,0008. Insurance 1,0009. Taxes 1,00010. Sales Expenses 3,00011. Misc. Expenses 3,000Total 30,000
(v) Total Recurring Expenditure (per month)
Sl. Description AmountNo. (Rs.)1. Salary and Wages 99,6002. Raw Materials 4,92,000
3. Utilities 5,0004. Other contingent expenses 30,000
Total 6,26,600
(vi) Working Capital (for 3 months)
Rs. 6,26,600 x 3 = Rs. 18,79,800
C. Total Capital InvestmentSl. Description AmountNo. (Rs.)1. Total Fixed Capital 10,23,6002. Working capital for 3 months 18,79,800
Total 29,03,400Means of financeT.C.I 29,03,400
Promotar contribition 25% 7,25,850Finance recive from bank 21,77,550
MACHINERY UTILISATIONInitially there will be 50% utilization of major machines which will increasethereafter @ 10% per year and consequently 90% utilization will beachieved in course of time, say, between 4-5 years.
FINANCIAL ANALYSIS(1) Cost of Production (per annum)Sl. Description AmountNo. (Rs.)i) Total recurring cost 75,19,200ii) Depreciation on machinery 86,460 @ 10% includinginstallation charges
iii) Depreciation on tools 15,000 and equipment @ 25% on Rs. 60,000iv) Depreciation on office equipment 10,000and furniture @ 20%vi) Interest on TCI @ 15% 4,35,510Total 80,66,170 Say 80,66,200
(2) Turnover (per annum)Sl. Items Qty. Rate PriceNo. (Rs.)1. Gense Bag 40,000 103 41,20,000
2. Ledise Bag 50,000 113 56,50,000
Total 97,70,000
(3) Net Profit (Before taxation) Amount (Rs.)
Turnover 97,70,000
Cost of Production (-) 80,66,200 Total 17,03,800
(4) Net Profit Ratio
= Net Profit per year x 100------------------------------------Turnover per year
= 17,03,800 x 100----------------------------------97,70,000
=17.43 %
(5) Rate of Return on Total Investment
= Net Profit per year x 100----------------------------------------- Total Investment
= 17,03,800 x 100----------------------------- 29,03,400
= 58.68%
(6) Break-even PointFixed CostSl Description Amount
No. (Rs.)a) Rent 60,000b) Depreciation on plant and machinery 86,400c) Depreciation on tools and equipments 15,000d) Depreciation on office equipments 10,000and furniture e) Interest on Investment 4,35,510f) Insurance 12,000g) 40% of salary and wages 4,78,080h) 40% of utilities 24,000i) 40% of other Contingent expenses 1,15,200on Rs. 24,000 (excluding rentand insurance)
Total 12,24,190
B.E.P.
= Fixed cost x 100----------------------------Fixed cost + Profit
= 12,24,190 x 100-----------------------------12,24,190 +17,03,800
= 41.80%
Additional Information
With the same plant and machinery, it is possible to manufacture different types of leather goods namely industrial hand gloves, suitcases, briefcases, bags etc.
Addresses of Machinery andEquipment Suppliers----------------------------------------
