Snopscys - Sachin

7/28/2019 Snopscys - Sachin

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A

PROJECT REPORT ON

TO CHECK OUT THE FEASIBLITY OF SUMUL TEA

STALL

UNDER TAKEN AT

SURAT DISTRICT CO-OPERATIVE MILK UNIONLTD. SURAT

SUBMITTED BY:

PATEL SACHIN B.

(06 MBA 41)

GUIDED BY:

ANIL SARAOGI

MBA PROGRAM

(YEAR 2006-2008)

SHRIMAD RAJCHANDRA INSTITUTE OF

MANAGEMENT AND COMPUTER APPLICATIONS


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SYNOPSIS:

I have Marketing specialization with the subject of study of to

check out the feasibility of SUMUL tea stall in Surat City. My project

period is from 21st

May 2007 to 18th

July 2007.For this survey, exploratory research design is used. Primary

data is collected from the tea hawkers and survey of customer who

drink tea at tea stalls in Surat city. Secondary data is collected from

previous reports. Sample size is 180 Customer who drink tea at tea

stalls and 100 tea hawkers. Research instrument is Questionnaire

based. Contact method is personal interview.

Surat District Co-operative Milk Producers Union Ltd, popularly

known as SUMUL, has the highest sale of milk in Surat city. It holds the

all India distinction of giving the highest price for the milk procured

from the farmer.

Beside milk supply, SUMUL also has a range of milk products,

which includes Ghee, Paneer, Flavored Milk, Sweets, Shrikhand, White

Butter, Condensed Dahi, Matho Sweet Cream, & other products like

Tea powder, Sugar.

My project is all about checking the feasibility of SUMUL tea

stall. Initially we did survey about milk consumption pattern of tea

hawkers. In it I found the type of milk that is being used and also

demand of tea in different areas of Surat in different season. We did

the survey about consumers taste and preference for tea.


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I found one interesting result from cross tabulation of

headache and effect that people who drink tea for

relaxation if they do not drink it they feel sleepy.

92.2% habitual persons get headache if they do not drink

tea. And also 88.1% of habitual respondents drink more tea

under stress.

79% of respondents dont prefer to drink any other thing

accept tea at tea stall.

Recommendations:

1. SUMUL should take an amount (say Rs. 300) per year as a token.

So that it can recover its capital expenditure quickly.

2. To get exact location and to be very nearer to road. Sumul

should give its tea stalls to the other people and even present

tea stall owners to open the stalls at an exact location.

3. SUMUL also can call present Tea stall owners selling tea near by

roads and use their expertise in tea business.

4. The very practical problem as shown in likely barriers is that

SUMUL Tea stall in the premises of milk agents may disturb the

milk agents regular business. (I.e. selling of other milk products).

From, analysis of customer characteristics say that most of the

customers of Tea are male and generally the milk products

selling into the shop like Milk, Buttermilk, Curd, Ghee etc. are tobe bought by Female. SO, A CROWD OF MEN ON A TEA STALL IN

FRONT OF THE SHOP MAY HASITATE THE WOMEN TO VISIT THAT

SHOP.

5. In the canteen of SUMUL Dairy, Tea was prepared from the other

and of tea powder and not of SUMULs. Such things may harm


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SUMUL Dairy reputation. So, we recommend Mkt. manager for

that and immediately notice given to the canteen owner to use

SUMUL Tea.

RESEARCH METHODOLOGY

1 Problem Definition:

The problem definition is to Check out the feasibility of Sumul tea stall

in Surat city. For that I have done survey on consumer taste &

preference for tea. & consumption pattern of tea hookers

2 Research Objectives:

To know demographic profile of people and frequency of tea

consumption.

To search out attributes and taste that consumers prefer.

To learn extent to which people are habitual to tea consumption

and its implication.

To know the probable selling and essentiability of other products.

To know the level of satisfaction.


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Research Design:

Here the descriptive research design has been used because here we

want to know taste & preference of people for taking tea. Here for

that project of feasibility I have also done exploratory research

for knowing seasonal demand of tea in different area.

Sampling Design:

Here non-probability random sampling has been used.

Sample Size: The sample size is 180 respondents for taste

&preference for tacking tea & 100 sample size for knowingconsumption pattern of milk for tae hawkers,& seas ional demand of

tea in different area.

Sampling Unit: The sampling unit comprises the customers of the tea

stalls across all age groups & tea hawkers.

Choice of Survey Method: Here for our research, we have selected

the personal interview method. Research instrument: Questionnaire

was used for the purpose of the data collection as the research

instrument. Questionnaire consisted of closed & open ended questions

including rating scalls.

Pre-testing:

It is necessary to check the questionnaire before actual research is

done. Therefore pre-testing is done. In this case, pre-testing was done

for 20 respondents, and on the basis of feed back, questionnaire was

fine-tuned.

A. Sampling Plan:


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Sampling Design and Sampling Method:

In this study, non-probability sampling design has been used and the

sampling method employed is random Sampling.

I. Define the Target population

-Element: Potential Customer of Tea Hawkers comes

-Sampling Unit: tea drinkers.

-Extent: Surat city

-Time: From 21st may.2007 to 18th July. 2007

ii. Select sampling techniques:

Non-probability convinces sampling.

iii. Execution of sampling process:

We have collected data from visiting tea stalls by conducting interview

of Customer who comes for taking tea tae hawkers.

3(A) MARKRTING FEASIBILITY:

Pricing:

- The study of customer characteristics says that high priceof tea do not affect their consumption or we can say they do

not bother the prices.

Because of co-operative nature SUMUL is going to charge

the reasonable prices from them.

Secondly, in order to be more competitive SUMUL has kept

its prices according to the market rates i.e. Rs.3 per cutting.

- SUMUL is going to sell its tea powder at the rate of

Rs.145per kg. And its cost will be Rs.135.


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- The selling price of Sugar is Rs.20 and its cost price is

s.19.50.

- Presently SUMUL is selling its milk Amul-Shakti at Rs.10

and Amul-Gold at Rs.11 respectively. From both the

type of milk SUMUL gets the profit of Rs.0.35 from milk

agents per pouch.

Promotional Tool:

Out of numbers of promotional tools SUMUL is going for the

Publicity tool. It means SUMUL wants to gain publicity

through word of mouth. SUMUL wants People to talk about

the Tea Stalls as news.

However publicity is not within the control of the company

and therefore company should give the advertisement.

Advertisement once will be resulted in more publicity. Thus,

IN ORDER TO GAIN PUBLICITY SUMUL SHOULD GIVE THEADVERTISEMENT.

Place:

Municipal Law:

Application has to be given to the Town-planning

commission Department on the Letter-pad of Sumul Dairy.

After analyzing the business and objective if it is found to

be acceptable then Town-planning Department send a

letter to the Zone-office of a particular zone.


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Land-Asst. Dept. of Zone office will analyses the

Application and Business SUMUL Dairy (has need) to give

a List of location to the Zone-office.

If it is feasible and does not the warm the public interest

then the permission is to be given 67 lands-Assets

Department.

After that permission has to be taken from Health

Department and co-operative has to convince then that

there will be no wastage or pollution.

The next step is that the officers from zone officer will

come to examine the place and the premise i.e. Laurie

and make sure that whether it is made in compliances of

municipal law or not.

If everything seems to be positive then permission will be

given.

Criteria:

4 4 feet Laurie not exceed than the Sumul has to open

all the tea stalls under its own responsibility.

It can not directly appoint any person to run the business

independently.

In future if any problem arises then only and only Sumul

will be responsible for that.

3. (B) How to Design the product and service

most effectively given the needs of the


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target Market & the competitive

Environment?

As SUMUL is a popular and repeated brand it will launch with a unique

style.

The tea makes will be in a dress and hand glows.

The Laurie will have an attractive painting of popular

shepherd photo & SUMUL tag.

Cleanliness / Hygiene will attract the customers.

The Cups are having a tag of SUMUL therefore, other people

may attract towards SUMUL tea following the other

consumers.

3. (C) Why People should drink SUMUL tea?

Variety of flavors

Brand name

Quality assurance because each product used is branded and

of good quality

4. FINANCIAL FEASIBILITY

Cost Structure

SUMUL is launching SUMUL TEA STALLS. SUMUL itself will be

incurring all the fixed expenses to start a new tea stall. It will also

provide all the necessary equipments to SUMULs Tea Stall Agents.

SUMUL is also not going to collect any commission from Tea stall

agents for using its brand name.

Fixed Cost:

(For starting one Tea Stall)


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Fixed Cost Rupee

s

Tea stall Laurie (4x 4) 20,000

Municipal tax(Advance) 3,650Burner (with two burner) 1,200

Dustbin 150

Hand Glows, Apron & Caps 150

Glasses & Dishes (24) 300

Other Vessels(kettle ,pan

etc)

1,800

Exps. of paints 500

Total fixed cost 27,750

Variable Cost:

Cost of 1kg of Sugar S.P Rs.20

C.P Rs.19.50

Net Profit 0.50 paisa

Cost of 1kg of Tea S.P Rs.145C.P Rs.135

Net Profit Rs. 10

Cost of Milk Packet S.P Rs.11


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(500ml each) C.P Rs.10.65 Net Profit

0.35 paisa (milk agent) for SUMUL pft is Rs.1

(Expenses incurred for making 600 cuttings)

Variable Cost Rupee

s

Milk (64 packets) 682

Tea (1.5 kg) 217

Sugar (6.75 kg) 135

Ginger 40Cardamom 54

Municipals tax(Daily) 10

Wages of worker 20

Wage of tea maker 40

Total variable cost 1198

Estimated Yearly Demand (per tea stall)

YearlyDemand

No. of cuttingsconsumed

(In Rs.)

Baroda bridge 2,14,440

Athwalines 1,36,800

Rander 1,14,600

Pandesara 1,60,320

Station road 99,360


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Yearly expected profit (For SUMUL)

Break even point (SUMUL)

Area No. of

Pouches

Milk

consume

d

(pft Rs.1)

Total

consumptio

n of tea (pft

Rs.10)

Total

Consumptio

n of sugar

(pft Rs.0.50)

Profit

(In Rs.)

Baroda Bridge23,760 5,360 1,207 30.327

Athwalines14,760 3,420 770 18,950

Rander 14,040 2,870 645 17,555

Pandesara15,840 4,010 902 20,752

Sumul road15,840 2,480 559 18,879

Total1, 06,463


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Break even point = 27,750 * 5

= Rs. 1, 38,750

Monthly Profit = 1,06,463/12

= Rs. 8,872

Daily Profit = 8,872/30

= Rs. 296

3 Months Profit = 88728* 3 =Rs.26616

Difference(32000-26616 )=Rs.5384

Days = 5384/296

= 18Day aprox.

B.E.P =1 Yr+3months+18

days

=473days


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FINANCIAL FEASIBILITY

Proposed Trading and P&L a/c of SUMUL Tea Stalls forthe year ended on 30-9-2008

Credit

Rs. Rs.

Net Sales

Tea Powder(1814kg.*Rs.145) 2,63,030

Sugar(8163kg*Rs.20) 1,63,260

Profit on Milk (84240No.

pouch*Rs.1)

84,240 5,10,530

Total 5,10,530

Debit

Net Purchase

Tea Powder(Rs.135/-) 2,44,890

Sugar (Rs.19.50/-) 1,59,179

Gross Profit 1,06,461

Total 5,10,530

Credit

Gross Profit 1,06,461

Total 1,06,461

Debit

Dep. Of Laurie 5,000

Dep. Of Burner 480

Hand glows, Apron & Cap 1,200

Exps. Of tea glasses and other vessels 2,400Exps. Of Paint 4,000

Municipal Tax (3650*5) 18,250

Net Profit 75,131

Total 1,06,461


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Balance Sheet of Sumul Tea Stalls as on 30-9-2008

LABILITY Rs ASSETA

Capital 2,00,000 Laurie 1,00,000

Net profit 75,131 5% dep. 5,000 95,000

Burner 9,600

5% dep. 480 8,120

Dustbin 1,200

Vessels 14,400

Cash 156,411

Total 2,75,131 Total 2,75,131

5. Data analysis & interpretation.1. Drinking frequency of tea & Income.

Purpose: - To know which income group people usually come to

Drink tea at a tea stall.

Case Processing Summary

CasesValid Missing Total

N

Percen

t N

Percen

t N Percent

income *

frequency180

100.0

%0 .0% 180 100.0%


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Income * frequency Cross tabulation

Inference:

In the above cross-tabulation, we have tried to find inter-relationship

between the frequency of tea and Income. It can be clearly seen from

the chart that respondents who are not earning drink tea

comparatively less in quantity i.e. 69.7% are fall in to category of 1to 3

Frequency Total

1-3 4-6 7-9

more

than 9 5 1-3

inco

me

not earning Count23 8 1 1 0

% within

income69.7% 24.2% 3.0% 3.0% .0% 100.0

below2000 Count 1 1 0 0 1% within

income33.3% 33.3% .0% .0% 33.3% 100.0

2000-5000 Count 29 14 3 3 0% within

income59.2% 28.6% 6.1% 6.1% .0% 100.0

5001-10000 Count 17 38 4 3 0% within

income27.4% 61.3% 6.5% 4.8% .0% 100.0

10001-

15000

Count8 10 5 0 1

% within

income33.3% 41.7% 20.8% .0% 4.2% 100.0

above

15000

Count6 3 0 0 0

% within

income66.7% 33.3% .0% .0% .0% 100.0

Total Count 84 74 13 7 2 1% within

income46.7% 41.1% 7.2% 3.9% 1.1% 100.0


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cup drinkers. While income group below 2000 they hardly visit tea

stall. 59.2% of people who lies in the income group between 2000-

5000 used to drink tea around 1 to 3 cups per day. Respondence that

lies between the incomes groups of 5001-10000 are more frequent

visitors of tea stall. Respondents who have income more than 10000

used to drink tea lesser in quantity at tea stall.

Chi-Square Tests:

Null Hypothesis (H0): There is no association between the drinking

frequency of tea at tea stall and Income.

Alternative Hypothesis (H1): There is some association between

the drinking frequency of tea at tea stall and Income.

Significant Level: 0.05

Chi-Square Tests

Value df

Asymp.

Sig. (2-sided)

Pearson Chi-

Square

64.539

(a)20 .000

N of Valid

Cases180

Inference:

Here the value of Pearson chi-Square is 0.000, since the significant

value is less than 0.05. So the null hypothesis is rejected and we can

say that there is some association between drinking frequency of tea

at tea stall and Income.

Explanation of Pearsons Chi-square:


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The Chi-square test is carried out at 95% confidence level (0.05

significance level). The Pearson Chi-square value comes out as 0.00,

which is less than significance level of 0.05; it means there is

significant association between drinking frequency of tea & income.

Rate the factors or attributes do you consider as

important for selecting tea stall for drinking tea.

Purpose:-which are the factors or attributes SUMUL has to consider

to be very important at the time of opening new tea stall.

2. Respondents opinion about Taste at the time ofselecting tea stall.

Taste

Scale Frequency Percent

Very Unimportant 11

Unimportant 4 2

Nutral 4 2

Important 107 59

Very Important 64 36

Total 180 100.0

Taste

1%2%2%

59%

36%

VeryUnimportanatUnimportanat

Nutral

Importanat

Vary Importanat


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From the above chart it is been observe that 59% & 36% of the

respondents have given more importance to taste at the time of

selecting tea stall. So it can be helpful for SUMUL to attract customers.

One Sample T-Test:

Null Hypothesis (HO): There is no significant difference between

calculated mean and hypothesized mean (4.00), in other words, we

hypothesize that the customer are agree with the statement that they

are not given more importance to taste.

H0: ST < 4

Alternative Hypothesis (H1): There is significant difference between

calculated mean and hypothesized mean (4.00),in other words, we

hypothesize that the customer are agree with the statement that they

are given more importance to taste.

H0: ST > 4

Statistical Test: one sample t-test is chosen because the

measurement of data is interval in nature.

Significance level: 0.05

T-Test

One-Sample Statistics

N Mean

Std.

Deviation

Std.

Error

Mean

Taste 180 4.28 .645 .048

One-Sample Test


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Test Value = 4.0

t Df

Sig.

(2-tailed)

Mean

Differen

ce

95%

Confidence

Interval of the

Difference

Lower Upper

Taste 5.890 179 .000 .283 .19 .38

Inference:

Here the test is performed at 95% significance level and the p-valuecomes out as 0.000 which is less than 0.05, it means that the null

hypothesis H0 is rejected and alternative hypothesis is accepted and it

can be said that there is significant difference between calculated

mean and hypothesized. Here we can say that when selecting tea stall

that time taste consider as important attributes.

6. CONCLUSION: - As I have done a project on To check out the

feasibility of SUMULs tea stall in Surat. For that I have undertaken two

surveys:

(1)To know the milk consumption pattern of tea hawkers.

(2)Consumers taste and preferences for tea.

From that I conclude that the demographic profile of customers highly

influence their taste and preference for tea. Like,

(1) Different areas of people have different kind of taste and

preferences and SUMUL should provide blends according to it, i.e.


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Varachha people prefer thick, strong and sweet tea whereas

Athwalines people prefer light and medium tea.

(2) Different age groups have different impact on the taste and

preferences, i.e. 18-25 years of people drink tea only for time pass,

whereas 26-41 years of people are habitual people and they drink

more frequently, so SUMUL should concentrate on this age group.

(3)The below 2000 income group usually do like to have tea at tea

stall. From the findings I conclude that following points are very

important on which SUMUL should concentrate more, i.e.

(1) 72% of respondents give more importance to good relationships,

68% give emphasis cleanly and hygiene, 82% do not give

importance to price, 95% give more importance to taste.

(2) Habitual class people suffer from headache if they do not drink

tea and who drink for relaxation if they do not drink tea then

they feel sleepy, under stress 92.2% habitual people drink more

tea. So there is an opportunity for SUMUL to take the advantage

and reach to their needs.

(3) Another conclusion is that SUMUL has no need to sell other

products on stalls.

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