1

A PRODUCT PROJECT REPORT

ON

Good luck pens mfg. Ltd.

PREPARED BY
Hirpara Bipin R. T.Y.B.B.A. ROLL NO. : EXAME. NO: -

K.K.PAREKH COMMERCE COLLAGE AMRELI

Preface

In the final year of B.B.A. programme, every student have to prepare product project report on any of the product by assuming that student hin self is an enteprneure. This helps us to practically know launching of the product by a new firm in market.

I have prepared product project report on Fountain Pens and Ball Point Pens

Place: - Amreli Date: - / /200

Yours Faithfully, (Hirpara Bipin R.)

ACKNOWLEDGEMENT

As a part of our T.Y.B.B.A. program we have to deal with practical aspect of preparation of product project report.

I fell very happy to present this report. This was really a challenge for me to prepare this product project report. I express my gratitude to Prof. M.M.Patel, incharge of B.B.A. department who have guided me to prepare this report.

Place: - Amreli Date: - / /200

Yours Faithfully, (Hirpara Bipin R.)

[DEPARTMENT OF B.B.A.]

DATE: - / /200 This is to certify that Mr. Hirpara Bipin R. is a student of final year B.B.A. has carried out the product project report as per the syllabus of Saurastra University, Rajkot. He has prepared product project report under our supervision and his own contribution for making this report during the academic year 2007-2008 is appreciated.

Prof. M. M. Patel (B.B.A. Incharge)

Prof. H. M. Shah (Principal)

Contents

Sr. No. 1 2 3 4 5 6 7 8 9 10 11 12 13

Particulars Project at a glance Promoters Details Introduction And Uses Of The Product Market Potential Production Process Production Capacity Financial Details Of a Project Name and Address of Suppliers Financial Arrangement Profitability of Project Summary Break Even Point Project Prospects

Page No.

Project At A Glance

Name Of the Unit Address

= Good Luck Pens Mfg. Ltd. = G.I.D.C.Estare. Jamnagar

Types of the Unit Name Of the product

= Partnership Firm = Fountain Pens Nad Ball Point Pens

S.S.I. Registration No. = Application is made with DDC. Subsidy Registration No.=Application is made with DIC. Location of the unit Name of Promoters = G.I.D.C.Estate, jamnagar. = 1. Hirpara Bipin R. 2. Desai Vipul M.

Promoters Details

Partner:-1 Name Age :Address :- Hirpara Bipin R. 20 years :- To Monpur Taluka:- Amreli District:- Amreli Education Qualification Division Of Responsibility Contribution :- B.B.A. (With Adv. Finance Mgt.) :- Production And Finance :- 50% From profit or loss

Partner:-2 Name Age :Address Education Qualification Division Of Responsibility Contribution :- Desai Vipul M. 20 years :- Nr. Swaminarayan Temple, Jasvant gadh Para, Chital 365620. :- B.B.A. (With Adv. Marketing Mgt.) :- Marketing And Personnel :- 50% From profit or loss

Introduction and Uses of the Product

Fountain pens and ballpoint pens are main instrument used for writing purpose. It is a mass consumption items in each and every person to remove some illiterate persons. These are required, due to the rapid growth of industrialization taking place in the country the demand for office stationery and allied items is fast increasing. Fountain pens and ballpoint pens play important role as a stationery materials. Presently the Govt. emphasis and encouraging to set up (establish) more and more industries in backward and rural areas for the purpose of to develop these areas people and to increase the STD. of living of these common persons who lives in the remote parts of the country. Any things in a business, services, education not possible with out fountain pen and ballpoint pen, so pens are a mass consumption items and its demand-increasing day today.

Market Potential
With increase in literacy (education) and economic development of the country the demand for fountain pens and ballpoint pens is increasing day today. It is essentials items for each and every person. If a person has no ball pens and wristwatches, he is not perfect man (person). So these two (pens And watch) are minimum qualification of a perfect and educated person.

Thus, there is a good scope for fountain pens and ballpoint pens. Industry at least every town, nation, state, district, talukas of country.

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Production Process
This is manufactured by using the raw material cellulose acetate butyrate, the other raw material likes cellulose acetate and polystyrene etc are not as good as cellulose acetate butyrate for these item. The cellulose acetate butyrate is an important raw material. This material is fed into the barrel through the hopper of the injection-molding machine. The barrel is heated by electricity and the material is pushed into the old mould by the piston by putting the handle. As soon as, it enters in the cold mould. It is gets the shape of the mould cavity. Open the mould and take out the molded product. The cap, barrel, nut, neck, etc of the fountain pen body are manufactured in this manner for small parts like nut, or hand opertated injection molding machines are used. Similarly barrel, cap, nut, neck, etc of the ball pen are also made in the injection molding machines.

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Production Capacity
Installed capacity Sr. No. 1. 2. Name of the product Fountain Pen Ball Point Pen Per Annum 1200 Gruss 1600 Gruss

Production (In Rs.) Sr. No. 1. 2. Name of the product per Gruss Fountain Pen Ballpoint Pen 600/- Rs. 220?-Rs. Per Annum 720000Rs. 352000Rs

Utilized Capacity 60%

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Financial Details Of A Project

* Land: This unit is established in GIDC area, Jamnagar-361 008

* Land & Building: Covered shed for factory 70 sq. maters rented Rs.12000 p.a.

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* Machineries & Equipments Sr. No. 1. 2. 3. 4. 5. 6. 7. Hand Operated or cap, 7 injection moulding machine Hand operated or cap, 2 injection moulding machine Polishing machine Nil Fitting Cap Holding Machine Mould freight, etc + electrification and installation charges 8. 9. Loss of machineries and equipment Office equipment and 5000 81500 working table Total 5000 2 1 1 10 sets 4000 1000 1000 1500 8000 1000 1000 15000 6500 5000 10000 Name Of Machineris Qty. Price In Total Rs. Rs.(Per Machine) 4285 30000

Packing, forewarning, taxes -

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Name And Address Of Suppliers

A) Machinery Suppliers 1. M/s Premier Plastics 58, Narayan Mudali St. Madras-1 2. Cash & Carry Machine Tools. 67, Armanian St. Madras-16

B) Mould Suppliers 1. Gokul Plastic Pvt. Ltd. 23/25, Developed Plot, Industrial Estate, Madras-32 2. Supreme Machine Tools Industrial Estate, Ambatlur, Madras-56

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C) Material Suppliers Cellulose acetate an imported item

D) Nibs And Refills 1. Ambition Nib Manufacturing Co. Ltd. C-101, Phase II, Mayapuri, New Delhi-110 064 2. M/s Balasubramaniam Works, 6/ 231- A Munsif Court, West St, Satlur, Tamil Nadu.

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Fixed Cost Statement

Sr.No. Details 1 2 3 4 5 Land & Building Machinery Contingency Preliminary Other Expenses Total Amount(Rs) 12000 81500 38400 131900

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Working Capital Statement

Monthly Sr.No. Details 1 2 3 4 5 No. Of Days Required Stock of raw materials 30days Work in progress Bills receivable Other expenses -Rent -Insurance -Repairs & Maintenance -Transport & Advertising -Stationery, Postage and Telephone etc. 200 3100 Total Working Capital For 3 months 96100 X 3 = 288300 Rs. 30 Days 3100 96100 1200 450 1000 250 2 days 30 days Stock of finished goods7 days Amounts(Rs) Monthly 50500 22000 15500 5000

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Total Cost Of Production

Sr.No. 1 2

Details

Amount 131900 288300 420200

Fixed Capital Working Capital (For 3 Months) Total working capital

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Financial Arrangement

Sr.No. Details Amt. 2. Machineries 3. Contingently 5. Other expenses Total

Total GSFC Bank Owned Subsidy Loan Loan Capital 3600 92910 51050 Rs 2100 24450 11410

1. Land & Building 14100 8400

4. Preliminary Exp. -

43776 26880 -

11520 5376

6. Working Capital 313302 -

100000188300 25000

46408692330 100000227870 43886

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Means Of Finance

Sr.No. Details 1. 2. 3. 4. GSFC Lona Bank Loan Subsidy Own Capital Total

Amounts 92330 100000 43886 227870 464086

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Profitability Of A Project
Details Of Sales And Production Sr.N. Details 1. 2. Fountain Pen Ball Point Pen Total Quantity 1200 1600 Rate 600 220 Amount 720000 352000 1072000

Raw Materials Sr.No.Details 1. 2. 3. 4. 5. Cellulose acetate Butyrate Clib for fountain Nil for fountain pen Ball pen refills Packing materials And misc. expenses Total 250 gruss 44 p.kg. 155 gruss 100p.g. 100 gruss 30 p.g. 11000 15500 3000 2000 --------50500 Quantity 200 kg. Rate 100p.kg. Amount 20000

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Sales And Wages Sr. No.Details 1. 2. 3. 4. 5. Manger Accountant Store Keeper/typist Skilled workers Unskilled workers Total No. Monthly 1 1 1 8 10 2000 1500 1000 800 300 Total (Rs) 24000 18000 12000 96000 36000 186000 Add: Bonus (20%) Total 37200 223200

Salary Rs (Yearly)

Electricity Consumption (annually) Electricity (power) Rent and Insurance 1) Rent (1000*12) 2) Insurance (250*12) Total 12000 3000 15000 700 kwh 7500/-Rs

Repairs and Maintenance (annually) Repair and maintenance (450*120) 5400/-Rs

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Depreciation Sr.No. Details Amount Rs Rate 1. Machinery & Equipments81500 25% 2. Furniture 10000 10% Total Amount 20375 1000 21375

Administration expenses Sr.No. Details 1. Accountants Salary 2. Printing And Stationery Total Amount (Rs) 18000 U 20400

Sales Expenses Sr.No. Details 1. Commission 2. Salesmess salry 3. Advertisement expenses 4. Other expenses Total Amount(Rs) 2450 15000 9600 1200 282500

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Interest Sr.No. Details Total (Rs) 1. 2. 3. GSFC Loan Bank Loan Interest on total capital investment Total Amount (Rs) 73444 75000 405400 553844 13.5 15.00 15.00 Rate (%) 9915 11250 60810 81975

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Summary
Sr.No. 1. 2. Details Sales Cost Of Production - Raw material 606000 - Salary & Wages 223200 - Electricity bills 75500 - Rent, taxes &insurance 15000 - Interest 81975 - Depreciation 21375 - Adm. Expenses 20400 - Repairs & Maintainance5400 - Selling Expenses 28250 1009150 62850 Less 3. Profit on sales 7.84 % Income Taxes Net Profit 8255 54595 Amount (Rs) 1072000

Cash receipts = (Net Profit + Depreciation) = 54595 + 21375 = 75970

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Break Even Point (BEP) Statement

Rs. 1) Total Production 2) Variable Cost - Raw material - Power & Fuel - Wages - Repairs & Maintenance - Selling Expenses Total Variable Cost 606000 7550 223200 5400 28250 870400 1072000

3) Fixed Cost - Rent, taxes and interest 15000 - Adm. Expenses 20400 - Depreciation 21375 - Interest 81975 Total Fixed Cost 138750 Variable Cost 870400 Total Cost

1009150 62850

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Sales Variable Cost 1) Contribution Ratio = -------------------------Total sales 1072000 870400 = -----------------------62850 = 3.21%

Fixed Cost 2) BEP = ----------------------- X 100 Contribution Ratio 138750 -----------3.20 43359 Rs

= =

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3) Rate of Return OR Profit On Capital

Profit ---------------- X 100 Total Cost 54595 ----------- X 100 1009150 5.41%

= =

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Project Prospects
The fountain pens and ball point pens manufacturing industry is a very wide, Prospective and profitable market. As can be understood from summery of project. Raw material and labor are easily available to this unit from the local area at a cheaper rate. The partners will look after the office work and sales also. They will visit regularly and will inspect all operations handled in the unit. Thus, the partners will keep their eye constantly. So there will not any fault or defect in any function of the unit and will run smoothly. The percentage on rates is around about 8 % and will increases rapidly year by rear. The unit pays regular legal expenses (like tax, etc) on income tax, sales tax and excise duty. The report provides all the information regarding the unit. Thus this report will enjoy various locational and other benefits, so the future of the project is very good and bright.