Kriti Makkar/ Madhu Agarwal/ Piyush Agarwal/ Satyam Kinno/ Shalabh Chauhan/

July 11

BUSINESS PLAN OF ENTERPRENEURSHIP

2011

CONTENTS

1. Project At A Glance.............................................................................................. 2 2. Introduction........................................................................................................... 4 3. Raw Material......................................................................................................... 5 4. Market Analysis.................................................................................................... 6 5. Process Of Flow Chart.......................................................................................... 9 6. Technical Aspects & Manufacturing Process....................................................... 10 7. Detail Of Utilities.................................................................................................. 12 8. Marketing.............................................................................................................. 13 9. Estimates Of Production & Sales.......................................................................... 15 10. Financial Plan & Projection.................................................................................. 16 11. Projected Profitability Statement.......................................................................... 22 12. Implementation & Schedule..................................................................................23 13. Oraganization & Management.............................................................................. 24 14. Details Of ManPower Requirement......................................................................25 15. H.R Policy & Strategy........................................................................................... 26 16. Proposed Layout.................................................................................................... 28

PROJECT AT A GLANCE

Proposed Industrial site Area of Plot Applied for Type of Industry

: : :

At Masuri Gulawat Road 1800 SQ.MTRS FOOD PROCESSING INDUSTRY MANUFACTURING OF JAM, JELLIES ETC.

OBJECTIVES

Long Term (VISION):

To be a billion dollar global manufacturer.

Short Term (MISSION):

To provide the distributors and contractors with unsurpassed quality, customer service and satisfaction with effective transparent communication and nurturing and promulgation of values and creativity.

INTRODUCTION

Jams and jellies are spread typically made from fruit, sugar and pectin. Jelly is made with the juice of the fruit: jam uses the meat of the fruit as well .Some Vegetable jellies are also produced.

Preserving foods was a home based operation unit in the nineteenth century. Even today millions of people make fruit preserves in their own kitchens. Whether in the home kitchen or in a modern food Processing plants, the procedure is essentially the same. Fruits are chopped and cooked with sugar and pectin until a gel is formed. The jam or jelly is then packed into sterilized jars.

RAW MATERIALS

Jams and jellies are made from a variety of fruits, either singly or in combination. Most of the fruits are harvested in the fall. Most jam and jelly producers develop close relationship with their growers in order to ensure quality. The production plants are elapsed between harvest and preparation in between 12-24 hours.

Sugar or high fructose corn syrup, or combinations of the two are added to the fruit to sweeten it. Cane sugar chips are the ideal type of sugar used for preserving food. Sugar is purchased from an outside supplier.

The element that allows fruit to gel is Pectin. It is present in varying degrees in all fruit. Apples, blackberries, cherries, citrus fruits, grapes, quinces and cranberries have the best natural gelling properties.

Critic acid is added to obtain the correct balance needed to produce the jam or jelly. Lime and lemon juice rate high in citric acid, therefore they are the most prevalent source used. Citric acid can also be obtained by the fermentation of sugars. It is purchased from outside suppliers.

Others flavorings, such as Vanilla, cinnamon, mint, alcoholic, beverages such as rum or Kirsch, can be added to the jam or jelly. These flavorings are purchased from outside suppliers.

MARKET ANALYSIS

OVERALL MARKET
Domestic demand for fresh fruits in india has been on the increase in the line with rising incomes, population growth and increased health consciousness among consumers. Fruit consumption in india is anticipated to increase by about 4 percent per year according to projected growth rates for incomes,population,and trends in food preferences. In addition, growth in demand for indian fresh and processed tropical fruits has been strong in recent years and this trend is likely to continue in the medium term. It holds considerable potential for domestic producers and suppliers of tropical fruits in India, and in the case of Indian market, for the overseas suppliers that are able to compete effectively with domestic suppliers . Growth in the fruit production and processing subsectors provides employment opportunities and income generation, and contributes positively to the food security. However, to fully realize this potential requires changes in the value chain, particularly to complete in the quality sensitive international markets. Development of efficient post-harvest handling infrastructure, transportation facilities and the quality of the produce must be priorities, especially for the fruits that are grown for the lucrative export market. Favourable growing conditions permit the production and supply of a large variety of tropical fruits throughtout years.These are consumed not only in the regions where they are grown but throughtout india.Terminal markets in major indian cities receive large quantities of tropical fruits,which are then sold through retail dealers in the other cities an towns.Statistics on consumption of tropical fruits are not available,so estimates need to be derived based on other infrmation available on production and trade. Total apparent consumption of fruits in india was estimated at 39 million tonnes in 2010(the latest year for which consumption data is available),about 8 million tonnes larger than in 2004,with consumption of fresh tropical fruits estimated at 16.3 million tonnes.Annual per capita consumption of fruit was evaluated at 37 kg in 2002,a 12 percent increase over 2005,with major tropical fruits at 13.3kg(bananas at 7.7kg),temperate fruits at 4.2 kg and other fruits at 5.9kg.According to the national sample survey organisation,64 percent of rural house holds reported fresh fruit consumption in 2009 compared to 84 percent of households in urban areas.

Production of selected fruits in India :

Average (2005/2007) Bananas Mangoes Oranges Apples Lemons and Limes Pineapples 956 Grapes 684 Papayas 470 Pears 127 Peaches and Nectarines Grapefruit and Pomelos Plums 55 Figs 6 Apricots 7 Cherries 4 9718 10108 1743 1205 863

2008 16820 10640 3120 1160 1440

2009

2010

83 83

1180 1210 700 200 150 140 80 11 10 8

16820 16820 10680 10800 3070 3070 1470 1470 1420 1420 1310 1300 1150 1200 700 700 200 200 150 150 142 142 80 80 11 11 10 10 8 8

Although India is one of the world's largest fruit producers, current export volumes remain small. Most of the fruit produced in consumed domestically. Export volumes represent less that 1 percent of total domestic ouput,as well as less than 1 percent of world exports.More than 0 percent of fruit export exports from india are tropical fruits,includin mangoes,guava,pineapples and papayas.India was the second largest exporter of mangoes in the world in 2004,after mexico,shipping 180000 tonnes or 21 percent of the world total.Exports of papaya and pineapple amounted to 3550 tones and 1624 tonnes,respectively .India also imports a sizable quantity of fresh fruits,but these are mainly temperate fruits such as apples and pears,and a large volume of dried fruits such as dates and raisin.Total imports of both fresh and dried fruits reached 216400 tonnes in 2003(the latest year for which a complete set of data on the value of trade exists),and were valued at US$47.1

Foreign exchange earning from fresh and processed fruits (including dried and canned fruit as well as pulps and juices)amounted to US$140 million in 2003,an almost twofold increase(185 percent)over the 1996-1998 average.Mango is the main fruit exported from india.Export earnings from fresh mangoes totalled US$80 million in 2003,which was 61 percent of indias's total fruit exports.About 50 percent of pocessed fruit exports were mango-based products,such as mango plp for juice mixes,and condiments including pickles and chutneys.However,on a comparative basis globally,only 2 percent of the fruit production in india is processed compared to 70 percent in BRAZIL,and 83 percent in MALAYSIA.It is

estimated that about 25to 30 percent of fruit production is wasted due to a lack of postharvest infrastructure.

SPECIFIC MARKET
The quint-essential parameter, that the market are highly price sensitive and competition oriented compels us to concentrate on domestic market for few years before moving on to international market. The product is a mass product, henceforth doesnt have any target audience as such.

COMPETITIVE FACTOR
Because it is a relatively simple process, the production of jams and jellies is not expected to change dramatically. What is apparent is that new flavors will be introduced. Certain vegetable jellies such as pepper and tomato have been marketed successfully. Other, more exotic types including garlic jelly are also appearing on grocery

MICRO-ENVIRONMENTAL INFLUENCE

FACTORS AFFECTING RISE IN DEMAND OF JAM and JELLY IN INDIA

Increase in population Income and prices Consumption habits and preferences:Now with the rapid changes in lifestyle in India, canned juices and beverages are preferred by working people.

PROCESS FLOW CHART

QUALITY INSPECTION OF FRUITS

CLEANING, CRUSHING AND CHOPPING

PASTEURIZING THE FRUIT

COOKING THE JAM AND JELLY

FILLING THE JARS

LABELING AND PACKING

TECHNICAL ASPECTS & MANUFACTURING PROCESS

The ingredients must be added in carefully measured amount. According to us, they should be combined in a proper ratio. The ingredients are Pectin, Sugar and an Acid concentration. The ingredients as mentioned earlier shall be added in a good proportionate as too much of pectin will make the spread too hard and too much sugar will make it too sticky.

INSPECTION When the fruit arrives at the plant, it is inspected for quality, using color, ripeness and taste as guides. Fruit that passes inspection is loaded into a funnel-shaped hopper that carries the fruit into pipes for cleaning and crushing.

CLEANING, CRUSHING AND CHOPPING As the fruit travels through the pipes, a gentle water spray clears away surface dirt. Some fruits like citrus and apples may be manually peeled, cored, sliced and diced. Cherries may be soaked and then pitted before being crushed.

PASTEURIZING THE FRUIT The fruit and/or juice continue through another set of pipes to cooking vats. Here, it is heated to just below the boiling point and then immediately chilled to just below freezing. This process pasteurization, prevents spoilage. In case of jelly, the pulp is forced through another set of small openings that holds back seeds and skin and needs to be passed through a filter. The fruit or juice is transferred to refrigerated tanks and then pumped to cooking kettles as needed.

COOKING THE JAM AND JELLY Pre-measured amounts of fruit and/or juice, sugar and pectin are blended in industrial cooking kettles. If additional flavorings are to be included, they are added at the same time. When the mixture reaches the pre-determined thickness and sweetness, it is pumped to filling machines.

10

FILLING THE JARS Presterlized jars move among a conveyer belt as spouts positioned above pour pressured amounts of jam or jelly into them. Metal caps are then vacuumed sealed on top. The process of filling the jars and vacuum packing them forces all of the air out of the jars further insuring the sterility of the product.

LABELING AND PACKAGING The sealed jars are conveyed to a machine that affixes preprinted labels. According to law, these labels must list truthful and specific information about the contents. The jars are than packed into cartons for shipment. Depending on the size of the producers operation, labeling and packaging is either achieved mechanically or manually.

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DETAIL OF UTILITIES Detail of utilities such like electricity and water plays a vital role in setting up a plant and therefore needs a proper estimation of cost. Likewise the estimated cost of electricity and water as per the prevailing rates per unit multiplied with no. of hours the electricity used will be somewhere about 5 lacs.

DETAIL OF RAW MATERIAL REQUIREMENTS

S.NO. 1 2 3 4 5 6 7 8

PARTICULARS FRUIT SUGAR PECTIN ACIDC COLOUR,ESSENCES PRESERVATIVES JAM SIZE CANS JAR CANS JAR CAPS LABELS AND STICKERS PACKING MATERIALS

AMOUNT PER MONTH

577,500,00

10

TOTAL

577,500,00

ANNUAL REQUIREMENT

6,930,000

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MARKETING

GRAPH SHOWING SALES AND PROFITS (In Lacs)

FOR 1ST YEAR:
SALES AND PROFITS
140 120 100

AMT

80 60 40 20 0 YEARS

SALES PROFIT BEFORE TAX NET PROFIT

FOR 2ND YEAR:

SALES AND PROFITS
160 140 120 100

AMT

SALES PROFIT BEFORE TAX NET PROFIT

80 60 40 20 0 YEARS

13

FOR 3RD YEAR:

SALES AND PROFITS
180 160 140 120 SALES PROFIT BEFORE TAX NET PROFIT

AMT

100 80 60 40 20 0 YEARS

FOR 4TH YEAR:

SALES AND PROFITS
200 180 160 140 120 100 80 60 40 20 0 YEARS SALES PROFIT BEFORE TAX NET PROFIT

AMT

14

ESTIMATES OF PRODUCTION & SALES

TH

S.NO.

PARTICULARS

1ST YEAR

2ND YEAR

3RD YEAR

4 YEAR

INSTALLED CAPACITY( In dozen) CANNED JAMS consisting of 500 grams JARS OF JAM, JELLIES AND MARMALADE 24000 30000 24000 30000 24000 30000 24000 30000

NO. OF WORKING DAYS

300

300

300

300

NO. OF SHIFTS

ESTIMATED CAPACITY UTILISATION

60%

70%

80%

90%

ESTIMATED ANNUAL PRODUCTION CANNED JAMS consisting of 500 grams JARS OF JAM, JELLIES & MARMALADE 14400 18000 16800 21000 19200 24000 21600 27000

SALES(In lacs) CANNED JAMS consisting of 500 grams

Rs. 54 72 63 84 72 96 81 108

JARS OF JAM, JELLIES & MARMALADE

TOTAL IN Rs.

126

147

168

189

AVERAGE SELLING PRICE CANNED JARS consisting of 500 grams JARS OF JAM, JELLIES & MARMALADE

375 PER DOZEN 400 PER DOZEN

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FINANCIAL PLAN AND PROJECTION

RESOURCES: CAPITAL COST OF THE PROJECT: (In lacs) Land: Building Machinery Other Fixed Assets Security Deposits Preliminary & Preoperative 58.50 31.70 20.40 9.40 12.50 7.50 -----------Total 150 ------------

MEANS OF FINANCING:

Promoters capital Term Loan required

140 lacs 60 lacs

Total

200 lacs

Employment Potential (nos.) : 80

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DETALIS OF PROPOSED MACHINERY

Particulars
Refrigrators fruit washing tank mini boilers 200 to 500 kg bottle washing machine all utensils of different sizes &mugs Wooden barrels for storage of pulps laboratory equipment kettle

qty
15 9 9 9

amount per pcs

30000 15000 125000 40000

Amoun t
450000 135000 1125000 320000

15000

135000

9 4 9

20000 50000 42000

180000 200000 378000

TOTAL

20,40,000

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COST OF LAND

PARTICULARS

APPLICANT

PLOT AREA APPLIED FOR

RATE

AMOUNT

Masuri Gulawati Road Distt. Ghaziabad (U.P.)

Kriti Makkar Madhu Agarwal PiyushAgarwal Satyam Kinno Shalabh Chauhan

1800

2900

5220000

TOTAL

5220000

Add: Conveyance Charges @ 8%

417600

Add: Registration Charges

212400

TOTAL

5850000

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COST OF BUILDING

PARTICULARS ground floor

AMOUNT

WORKING HALL

945000

INSPECTION &PACKING DIVISION

450000

GUARD ROOM,PARKING,GENERATOR ROOM ETC

200000

FIRST FLOOR

OFFICE

700000

STORES

350000

BOUNDARY WALLS

325000

TOTAL

3170000

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DETAIL OF MISC ASSETS

PARTICULARS

AMOUNT

AIR CONDITIONERS,FURNITURE,&FIXTURES

500000

GENERATOR

375000

FIRE EXTINGUISHERS

65000

TOTAL (RS)

9400000

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COST OF PROJECT AND MEANS OF FINANCING

S.No.

ESTIMATED COST OF PROJECT

In Lacs

Expenses

1 2 3 4 5 6

Cost of Land Building Machinery Misc other Assets Security deposits Preliminary & preoperative TOTAL

5850000 3170000 2040000 940000 1220000 149000 14000000

A. B.

Capital cost of Project Working Capital TOTAL PROJECT COST

1400000 6000000 2000000

MEANS OF FINANCING 1 Promoters contribution For Capital Cost For Working Capital Through Internal Accriuals 10000000 3500000 500000

2 3

Term Loan From Bank Working Capital Loan TOTAL

3800000 2200000 20000000

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PROJECTED PROFITABILITY STATEMENT

S.No. A. PARTICULARS SALES TOTAL 1ST YEAR 378 378 2ND YEAR 441 441 3RD YEAR 505 504

B.

COST OF OPERATION Raw Material Wages Electricity, Fuel & Power Repairs & Maintenance Other Manufacturing Expenses TOTAL 207 60 9 4 240 70 11 3.7 276 75.5 13.4 5.3

9 289

11.8 336.5

13.4 383.6

C.

GROSS PROFIT(A-B)

89

105

120.4

D.

SELLING AND ADMINISTRATIVE EXPENSES Insurance Interest on Term Loans Interest on Working Capital Depreciation TOTAL

30.23 1.2 11.7 4.56 15.1 62.79

34.46 1.45 8.95 6.82 17.59 69.41

37.83 2.38 9.21 7.08 13.13 69.63

E. F. G.

PROFIT BEFORE TAX PROVISION FOR TAX NET PROFIT

26.21 7.86 18.41

35.6 10.68 24.92

50.77 15.23 35.54

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IMPLEMENTATION SCHEDULE

The proposed project shall be implemented in the following time period.

STAGES
Payment of 25% of Cost of Land Provisional SSI registration & Pollution Board NOC Physical possession of Land & Execution of Legal Documents Approval & Sanctioning of Building Plans Term loans Sanctioning & Disbursement from Financial Institutions for Project Commencement of Factory Building After taking Physical Possession

TIME PERIOD
Need to deposit with Application form. Within 2 months from Allotment letter. Within 2 months from date of Allotment.

Within 1 to 2 months from Allotment of Plot. Within 1 to 1-1/2 month.

Immediately after approval of building plans. Maximum time Within 4 to 5 months from taking over Physical Possession. Within 9 to 10 months from taking over Physical possession. 2 months before Completion of Factory Building. 10th to 11th month from taking over Physical Possession. Within 1 month from completion of Factory Building and before Erection of Machinery. Within 11th month from taking over Physical Possession.

Completion of Factory Building

Placement of orders of Plant & Machinery Erecting & Installation of Machinery

Placement of Technical Manpower & Executives

Commencement Commercial Production

NOTE: Implementation of this project will be within 1 year from the date of allotment.

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ORGANIZATION AND MANAGEMENT

FORM OF BUSINESS:
The form of our business is partnership. We are six partners : Kriti Makkar Madhu Agarwal Piyush Agarwal Satyam kinno Shalabh Chauhan with equal share in profits and losses.

EQUITY POSITION
The total investment in our business is Rs.200lacs out of which Rs.40lacs is invested by each member in equal share or in profit sharing ratio like 1:1:1:1:1 or we can say that by investing equal amount of rupees like Rs28.lacs by all partners. The other part of amount of Rs 60lacs will be taken by bank as a loan amount. The total amount of our business is including all cost like cost of land, building, machinery, fixed asset, security deposits etc.

KEY PERSONNEL
The key personnel or man power requirement of our business is divided in 2 parts like for factory and administration. The overall summary of manpower requirement is 80 and the cost is Rs.2497200. in factory the total requirement on person is 60 which include: Factory managers Food chemists Supervisors Mechanic cum boilers operators Skilled workers Semiskilled workers Unskilled workers
Watchman

In administration the total requirement of person is 20. Accounts and stores staff Purchase executive Sales executives Subordinates staff
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DETAILS OF MANPOWER REQUIREMENT

PARTICULARS NO. SALARY (P.M.) AMOUNT (P.M.) ANNUAL

FACTORY Factory managers Food chemists Supervisors Mechanic cum boilers operators Skilled workers Semi skilled Unskilled Watchman 2 4 4 12500 10000 7500 25000 40000 30000 300000 480000 360000

4 24 8 12 2 60

7500 4500 4200 3800 3500

30000 108000 33600 45600 7000 319200

360000 1296000 403200 547200 84000 3830400

ADMINISTRATION

Accounts and Stores staff Purchase executive Sales executives Subordinate staff

2 2 6 10 20

4000 6000 7000 3500

8000 12000 42000 35000 97000

96000 144000 504000 420000 1164000

SUMMARY Factory(Wages) Administrative(Salaries) Total 319200 97000 416200 3830400 1164000 494400

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H.R POLICY AND STRATEGY

The H.R policy of our business is based on selection and recruitment. The process of selection and recruitment includes different rounds which make the process easier. Before recruitment every member of organization will be well trained by giving proper training with most modern equipment which make them nimble in their work. Like other organization our business also starts from top level management to lower level. Leaders and top managers create the culture of their business. It is therefore critically important to recruit and retain the right kinds of people at the top in leading and managing your business to high performance. Among other things, people who display the qualities of good leadership in business are expected to be highly ethical and organized and to manage against the detailed objectives of the small business plan, while simultaneously having a grasp of the "big picture," strategic agenda of the business. There are some steps which are providing some career planning like: Possess a Personal Sense of Mission, Vision and Values Develop a Personal Sense of Responsibility and Accountability Sharpen Personal Skills in Sharing Information and Communicating Effectively Learn How to Identify Gaps and Manage Them Motivation (both monetary e.g. Salary, incentives, bonus etc and non monetary e.g. Appreciation, job enrichment, etc) Well developed schedule for various schemes like VRS, CRS etc Transparent & effective communication between the top level managers and the workers. Implementation of decentralization and delegation of authority.

In our business the other important key for our organization are workers working in our factory like skilled, semi skilled and unskilled workers etc who will be trained in their work with latest machinery and technology. The training will be renewed after every 6 months or whenever required. They will also be motivated by giving proper appraisals in the form of bonus, gifts, schemes etc.

The policy of our business is to employ right person at right job.

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ASSUMPTIONS AND NOTES

We have assumed the following assumptions for financial working. They are as follows: Sales are assumed to be 60%, 70% and 80% of its installed capacity in the first, second and third year respectively. 10% increase in salaries and wages is provided in the subsequent years. Other manufacturing expenses are 5% of Raw Material Consumption.

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PROPOSED LAYOUT PLAN OF THE FACTORY

GENERATOR TOILETS 5 MTRS OPEN AREA ROOM

DRINKING WATER

RAW MATERIAL STORE 4-1/2 MTRS FINISHED GOODS GODOWN PRODUCTION HALL 5 MTRS

INSPECTION AND PACKING ADMINISTRATION BLOCK

LABORATORY PARKING OPEN AREA SECURITY ROOM 6-1/2METRES TIME OFFICE PURPOSE OF OPEN AREA FOR LOADING, UNLOADING, INTERNAL ROADS, PARKING, VENTILATION & PLANTATION etc.
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