Hiren Mineral Water

8/2/2019 Hiren Mineral Water

1/37

o

Prepared By : ZINZUWADIYA JUGAL H.

Class : T.Y.B.B.A.

Roll No : 108

Academic Year : 2011-12

College

C.U.SHAH COLLEGE OF COMMERCE,MANAGEMENT

& COMPUTER EDUCATION WADHWAN.

Enrolment No:

402/515/09

Guided By

PROF. RASHMI PARMAR

Submitted To

SAURASHTRA UNIVERSITY RAJKOT


2/37

2


3/37

DECLARATION

I, the undersigned, Zinzuwadiya Jugal H a student of

T.Y.B.B.A. here by declare that the project work presented in this

report is my own work and has been carried out under the

supervision and guidance of Prof. RASHMI PARMAR of

C.U.SHAH college

This work has not been previously submitted to any other

university for any other examination.

Date: SIGNATURE,

Place: SURENDRANAGAR Zinzuwadiya.Jugal.H

3


4/37

PREFACE

SSI is a pillar of Indian economy. Most of the businesses

carried out in china are those of small scale units. In India , due to

liberalization and globalization , the competition has increase and a

severe problem has to be faced by SSI of India and thus most of the

small scale units are paralyzed.

Today there is a need for substituting the traditional

management techniques by the scientific system of management

proper implementation of such a technique provides necessary

impetuous to SSI in the right direction at the right time.

I am extremely happy to submit this project report on a small

scale unit under the prescribed syllabus of Saurashtra University

Rajkot. The preparation of a Product Project Report is a modest way

of helping students to develop entrepreneur skills, ability and

aptitude. By making this report , I got a golden opportunity to

acquire practical knowledge of forming such a unit. I have tried to

cover all the relevant points precisely.

4


5/37

ACKNOWLEDGEMENT

It is a matter of pleasure for me to prepare this report.

I would like to thank the SSI Office Staff, zoom Beverages

(Drink) , Sagar Mineral Water and Giriganga Mineral Water

packages for providing valuable information.

I am also thankful to all the local manufacturers and traders

of Mineral Water for helping me and providing me with valuable

information.

5


6/37

INDEX

Sr. No Particulars

1 Introduction2 Project at a Glance

3 Bio-Data of Promoters

4 Management Set-up

5 Justification of Location

6 Location of the unit

7 Product Details

8 Market Potential

9 Marketing Strategies

10 Manufacturing Process11 Implementation of Schedule

12 Presumptions

13 Staff and Labour

14 Raw Material

15 Miscellaneous Expenses

16 Utilities

17 Working Capital Requirement

18 Fixed Capital

19 Project Fund20 Sources of Finance

21 Cost of Production

22 Break Even Analysis

23 Ratio Analysis

24 Risk Factors

25 Future Plans

26 Name and Address of Machinery Suppliers

27 Name and Address of Raw-Material

Suppliers

6


7/37

Introduction

Gujarat is a state where temperature starts from 35 dg to 40

dg and goes up to 40 to 45 dg in summer season. Apart from that

majority part of state of Gujarat is facing deep water crisis in

summer especially kutch. Rajkot is one of the fast developing city

of Gujarat and it is one of the best centres for various economic and

industrial activities.

7


8/37

Due to continuous increase in population of Gujarat, the

problem of drinkable water is great in Gujarat and Mineral Water

industry try to lessen this problem of drinkable water.

Factually supply of Mineral Water is satisfying only 60% of

total demand. Several firms are already engaged in this business but

capacity & production is limited and demand for the same is

increasing violently. So there is a great possibility of development

of business of mineral water in future in RAJKOT. The product will

enjoy great Marketing acceptance in present as well as in future.

8


9/37

Project at a Glance

Name of the unit Ganga Mineral WaterForm of Organization Partnership

Name of promoters 1. Mr. Rahul Maheta

2. Mr. Vimal Shah

3. Mr. Smit Ranpara

4. Mr. Hemal patel

Product Mineral Water

Size of the Unit Small Scale UnitSSI Registration No. Application has been made registration

number has not yet been allotted

Location of the Unit Ganga Mineral Water,

Shapar (Veraval), Rajkot.

Cost of the Project 1,24,12,000

Sources of Finance or

Capital Structure

Ownership : - 1,06,12,000

Borrowed Capital: - 18,00,000

Brand Name Pure

9


10/37

Bio-Data of P artners

Partner I

Name Mr. Rahul Maheta

Age 28

Address 102, Gokul Appartment, Palace

Road, Rajkot

Qualification M.B.A. (FINANCE) & C. A.

Experience 3 years experience in FINANCE

DEPT. OF RAJA MINERAL

WATERResponsibility Responsibility of Policy Making

& Accounting Department

Financial cont. 30%

Partner II

Name Mr. Vimal Shah

Age 30Address 303, Hemsagar Palace, Gondal

Road, Rajkot

Qualification MBA (HRM)

Experience 2 Years experience in HRM

DEPT. OF PURE MINERAL

WATER

Responsibility Responsibility of Personnel

Dept.

Financial cont. 30%

Partner III

Name Mr. Smit Ranpara

10


11/37

Age 28

Address Radha-Krishna, 25/44 Prahlad

Plot corner, Prahlad Road,

RajkotQualification M.B.A. (MARKETING)

Experience Fresher

Responsibility Responsibility of Mktg. Dept.

Financial cont. 20%

Partner IV

Name Mr. Hemal Patel

Age 30Address 201, Siddhi-Vinayak

Appartment, Kalawad Road,

Rajkot

Qualification M.B.A. (PRODUCTION)

Experience 2 Years experience in

PRODUCTION DEPT. OF

NATIONAL MINERAL

WATER

Responsibility Responsibility of Production

Dept.

Financial cont. 20%

Management Set Up

All these four promoters are entitled to take the post of

directors and all these are working partners. Mr. Rahul Maheta will

handle the finance and accounting Department. Mr. Vimal Shah

will handle Human Resource or Personnel Department.

Mr. Smit Ranpara will handle Marketing Department and Mr.

Hemal Patel will handle Production Department.

11


12/37

The capital ratio of all these four partners i.e. Mr.Rahul, Mr.

Vimal, Mr. Smit and Mr. Hemal is 30:30:20:20 and the profit

sharing ratio will be 25% each.

Justification of Location

The location of a unit is a crucial decision which an

entrepreneur has to take. There are various factors affecting such a

decision. The location that Ganga Mineral Water has chosen after

analyzing various factors.

12


13/37

Cost of land: -

The cost of land in this area is lower as compared to land in

the middle area of the city. After cost analysis of land, price and

transportation cost the location has been selected.

Labour: -

Cheap labour resides in large Quantity in this area. Therefore,

the availability of labour is convenient and economical.

Transportation: -

The transport cost is comparatively less because the market

place is away only at a distance of 10-12 Kms and various

transportation vehicles are also available at this location.

Availability of Raw-Material: -

The basic Raw-Material is water. Water is easily available.

Market Nearness:-

The market is near to the mftg. Area so that whenever the

need arises ,

It is possible to supply specified quantity of mineral water to the

local groceries and supermarkets.

LOCATION OF THE UNIT

Name : GANGA MINERAL WATER

ADDRESS : SHAPAR (VERAVAL)

PLOT NO.1 & 2 , SECTOR-3

13


14/37

RAJKOT

PHONE NO : 0281- 2229497, 2229496

FAX NO : 0281- 4567890

WEBSITE : WWW.GANGAMINERALWATER.COMEMAIL : [email protected]

Product Details

Water is a basic necessity of life, something without whichwe cant exist. Unfortunately, most of the water which reaches our

14
http://www.gangamineralwater.com/http://www.gangamineralwater.com/


15/37

home and establishment for drinking is full of bacteria and

without pure Filtering.

The Ganga Mineral Water will be available in the market to

the customers in pouches, bottles and jars. It passes through three

different filters then it reaches for packing.

Per Pouch Rs.1

Per Bottle Rs. 10

The production capacity of this Mineral Water Plant is 24,000

Litres per Month.

15


16/37

Market Potential

Water is common denomination for every living thing on the

earth. Various impurities such as bacterias, organics, metals

mineral salts and gases are present in water which is naturally

available but we cannot see by eyes but once we look at

microscopic lenses picture, We shall come to know about them.

These impurities cause various diseases in our body and i.e. why we

step into to introduction of a pure water. Purifying system which

produces healthy water at nominal cost and reaches to our day to

day use. Especially for drinking water purpose.

Summer is a period of holidays during which the demand or

requirement of pure mineral water increases because most of the

people are going for picnic.At that time, for the purpose of

drinkable water on picnic places , most of the people uses pouches

as well as bottles of pure mineral water .Gujarat is one of the mostimportant place for picnic, during summer, rush of the people

increase in Gujarat, so at that time, the problem of drinkable water

is great and mineral water industry plays an important role to lessen

this problem. And also. Summer is a season of marriages. Hence, in

marriages also, demand or requirement of pure mineral water is

more.By seeing the potentiality and demand of pure mineral water,

the product will 100% enjoy great acceptance of customers in

present as well as in future.so, thereis a huge potential in mineral

water industry.

As we know that the water is the essential and easily

available element for survival of life, there is no one on the earth

who is not using water, and today in this health conscious era,

16


17/37

people are so much aware about different diseases which is

spread through water. So, In this era, every one think of use of pure

and treated water.

Thus, by looking all these potentialities , the mineral water

industry has bright future.

17


18/37

Marketing Strategies

With the launch of this product, Ganga Mineral Water enters

the market with an intention to penetrate consumers with new

strategies like:

(1) Daily Free Delivery: -

Ganga Mineral Water gives the unique facility to its

customers of daily free delivery in offices, home, educational

institute and other places twice a day.

(2) Unique Concept: -

This concept is totally unique. The Ganga Mineral Water uses

Bio-Grade Plastic to packing their product. So, the plastic does not

affect the water.

18


19/37

Manufacturing Process

Clean/treated water storage There are different steps involved

in this system or process, as under:

Water pumping from bore well.

Addition of Alum and other Chlorination dosage in raw water

storage tank.

Filtration by sand filters.

Filtration by activated carbon filters.

Filtration by micron filters.

Cosmetic pressure system.

Passing of water from no membranes.

UV systems for bacteria killing.

Final polishing filters.

tank.

Packing of water.

19


20/37

Implementation of Schedule

No. Activity Completion

Time

1. Acquisition of land and construction of building. 1 Month

2. Approval of loan and other formalities. 1 Month

3. Installation of machinery. 1 Week

4. Arrangement of power. 1 Month

5. SSI registration. 20 Days

6. Staff appointment. 3-4 Weeks

20


21/37

Presumptions

I Working days: 6 Days in a Week

26-27 Days in a Month

II Shift: Double shift

III Working Hours: 7 A.M. to 3 P.M.

4 P.M. to 12 P.M.

IV Government Policy: Very low tax rate prevails at 0.1%

V Banking Policies: (a) Loan Rate 24% p.a.

(b) Subsidy of 10%

21


22/37

Staff and Labour

No. Particulars No. of

Persons

Rate

per day

Amt. (per

month)

Amt. (per

year)

1. Manager 1 135 4,050 48,600

2 Supervisor 1 110 3,300 39,600

3. Accountant 1 150 4,500 54,000

4. Distributors 1 100 3,000 36,000

5. Salesman (door to

door delivery)

4 70 8,400 1,00,800

6. Unskilled Labour 12 35 12,600 1,51,200

7. Driver 2 50 3,000 36000

8. Peon Cum

watchman

2 25 1,500 18,000

TOTAL 40,350 4,84,200

Therefore, staff salary for three months will be:

40,350 3 = 1,21,050

22


23/37

Raw Material

The raw material required to produce mineral water are as follow:

No. Items Rate

(Rs./Lit.)

Monthly

Reqmt.

(Lit.)

Yearly

Reqmt.

(Lit.)

Yearly

(Rs.)

Amount

1. Raw Material 8.88 24,000 2,88,000 25,57,440

2. Alum 12.00 5,000 60,000 7,20,000

3. Chlorine &

other Anti

effluents

15.00 6,000 72,000 10,80,000

TOTAL 43,57,440

23


24/37

Mis cellaneous Expenses

No. Particulars Amount

Rs./Month

Amount Rs./Annum

1. Traveling expenses

(Rs. 300 daily)

9,000 1,08,000

2. Postage & Stationary 800 9,600

3. Repairs &

Maintenance

3,000 36,000

4. Packaging Expenses 14,000 1,68,000

5. Telephone Charges 2,000 24,000

24


25/37

Utilities

No. Particulars Amount (Rs./Annum)

1. Water (Rs. 9,000 Per Month) 1,08,000

2. Electricity (Rs. 2,000 Per Month) 24,000

TOTAL 1,32,000

25


26/37

Working Capital Requirement

No. Particulars Amount (per months)

1. Postage & Stationery 800

2. Traveling Expenses 9,000

3. Electricity Expenses 2,000

4. Telephone Expenses 2,000

5. Salaries 40,350

6. Repairs & Maintenance 3,000

7. Raw Material 3,63,1208. Packaging Expenses 14,000

9. Interest on Borrowed capital @ 24% 36,000

10. Depreciation on Plant & Machinery @

8.75%

29,730

TOTAL 5,00,000

Working Capital Requirement for Three Months:

5,00,000 3 = 15,00,000

Working Capital Requirement for Whole Years:

5,00,000 12 = 60,00,000

26


27/37

Fixed Capital

Fixed Assets

No. Particulars Amount

1. Land (3600 sq. mt). 25,20,000

2. Building (construction cost). 33,92,000

3. Plant & Machinery @ 8.75% 40,00,000

4. Other Assets

Erection & Commissioning Cost.

Furniture & Electricification.

Consultancy Charges

5,00,000

1,00,000

1,00,000

Total Fixed Cost 1,06,12,000

27


28/37

Sources of Finance

No. Particulars % (Percentage) Amount (Rs.)

1. Owned Capital

Mr. Rahul (30%)

Mr. Vimal (30%)

Mr. Smit (20%)

Ms. Hemal

(20%)

85.50% 1,06,12,000

2. Borrowed Capital 14.50% 18,00,000

28


29/37

Project Fund

Particulars Amount (Rs.)

Fixed Capital 1,06,12,000

Working Capital 60.00,000

Total Project Cost 1,66,12,000

29


30/37

Cost of Production

No. Particulars Amt.(Per Month)

1. Raw Material 3,63,120

2. Labour (Direct) 15,900

3. Administrative Cost 66,150

4. Depreciation 29,730

5. Repairs & Maintenance 3,000

6. Interest 0n Borrowed Capital @ 24% 36,000

7. Power & Fuel 6,100TOTAL 5,20,000

Direct labour includes wages of supervision and unskilled

laborers.

Administrative costs include salaries of staff, traveling

expenses, packaging expenses, postage and stationery and

telephone charges.

Depreciation includes the total depreciation of all.

30


31/37

Break Even Point/Analysis

Break Even point is that level of activity where there is no

profit no loss. Break Even Point can be derived through

mathematical formula or graphical chart.

Break Even Chart indicates approximate profit or loss at

different levels of sales volume. However, Break Even Analysis is

based on certain assumptions, they are as follows:

All costs can be segregated in fixed and variable components.

Production and Sales are equal.

Selling price remains constant at all level.

B.E.P. in Rupee Value: -

Contribution= Fixed Cost + Profit

= 8,06,000 + 8,10,000

= 16,16,000

Whete, Fixed Cost = Electricity Exps. + Int. on Borrowed Capital +

Depreciation on Plant & Machinery

= 4,32,000 + 24,000 + 3,50,000

= 8,06,000

P/V Ratio = Contribution 100

Sales

= 16,16,000 100

70,50,000

= 22.92%

31


32/37

Where, Sales is a approximately sales for a year

Therefore B.E.P. = Fixed Cost

P/V Ratio

= 8,06,000

22.92%

= 35,16,580 Rs.

B.E.P. in Percentage:

B.E.P. = Fixed Cost 100

Fixed Cost + Profit

= 8,06,000 100

8,06,000 + 8,10,000

= 49.88%

Where, Profit = Sales Cost of Production

= 70,50,000 62,40,000 (5,20,000 * 12)

= 8,10,000

32


33/37

Ratio Analysis

Net Profit Ratio: -

N.P.R. = Net Profit 100

Sales

= 8,10,000 100

70,50,000

= 11.50%

33


34/37

Risk Factors

(1) Competition: -

Existing competition from universal Raja Mineral

water, Bisleri Mineral water, Kinley & Oxyrich mineral

Water etc.

(2) Seasonal Fluctuations: -

Seasonal Fluctuations during the year especially in

summer because the basic raw material is water. So, in

summer there is scarcity of water.

34


35/37

Future Plans

The firm plans the following for years to come:

It may increase its production of mineral water in both

Pouches and Bottles.

The firm plans to have take big orders from Marriages,

Functions and in Parties.

To increase the production capacity and thereby employing

more and more number of workers.

To cover the large part of market share of local region within

2-3 Years.

To provide the best quality of mineral water at reasonable

prices.

35


36/37

Name & Address of Machinery

Suppliers1. Hindustan Machinery Limited

Near Lal Darwaja,

Baroda

2. Doshi Equipment & Tools Limited

Plot No. 24, 25, 26,

Phase 2,

GIDC VATAVA,

Ahmedabad.

3. Universal System

Tagore Road,

Golden Plaza

Rajkot

36


37/37

Name & Address of Raw-Material

Suppliers

1. Arena Chemicals Limited

Aji Industrial Estate,

Rajkot

2. Paramount Polythene Limited

Dhebar Road Oneway,

Near City Traffic Police,

Rajkot

3. Orra Plastic Bottle Manufacturing CompanyAshram Road,

Near Sharda School,

Ahmedabad

Hiren Mineral Water

Documents

Transcript of Hiren Mineral Water