Project Profile - LAP TOP BAGINTRODUCTION

         Laptop Bags are used for carrying Laptop Computers safely and securely while you are on the move. They come in different shapes and designs, suiting the customer interests. There are a few varieties of the item, viz., Women Laptop Bags, Laptop Messenger Bags, Laptop Shoulder Bags, Laptop Backpacks, Laptop Sleeves, Hard Shell Laptop Bags, Rolling Laptop Bags, Laptop Bags for Laptop Accessories, etc. Of them, Laptop Shoulder Bags and Laptop Backpacks are of chief use.

MARKET POTENTIAL

         Nowadays, there is growing demand of these items in the society, especially with IT revolution worldwide. IT Professionals, Executives, Businessmen and others have started switching over from Desktop Computers to Laptop Computers for easy use. Laptop Computers are prone to scratches and damage during move. Laptop Bags prevent such destruction of the units and keep them handy, new and intact. Hence there is great demand for these items both in the domestic and international markets and people do not mind paying for them because of their great utility and attraction.

BASIS AND PRESUMPTIONS

1. Efficiency and working hoursSingle shift basis consisting of 8 hours per day, 25 working days in a month and 300 

working days in a year.

2.Time period for achieving the full envisaged capacity utilization 5 years

3. Labour & wages Monthly basis

4. Interest rate for fixed working capital 16 %

5. Margin money 25 %

6. Operative period of the project 5 to 10 years.

7. Land and building Rented.

8. Pay back period of loan 10 to 12 years.

IMPLEMENTATION SCHEDULE

1. Registration and other formalities 1 month

2. Land acquisition and quotation 2 months

3. Construction work 4 to 6 months

4. Machinery purchase and installation 2 to 3months

5. Trial production 1 month

Total 12 months

TECHNICAL ASPECTS

(i) PRODUCTION DETAILS & PROCESS OF MANUFACTURE:

         The components are marked as per the pattern on Rexene, Lining Rexene and are cut out. Then, adhesive is applied on the components and lining attached. Edges are beaded with beading wires and zips attached. Then, the components are assembled and stitched with the help of post-bed/cylinder bed sewing machine. The excess lining is trimmed and bags are reversed inside out. Handles, fancy fittings, buttons, etc are attached. Excess threads are trimmed and finishing done. The bags are stamped brand name, inspected and packed for dispatch.

(ii) QUALITY SPECIFICATION: As per the customers’ requirement. 

(iii) Production Capacity:

Sl No. Item Quantity Rate (Rs.) Value (Rs.)

1. Lap Top Bag 30,000 Nos. 1300/bag 3,90,00,000/-

(iv) Motive Power (Approximate): 5 HP

(v) Pollution Control:

         There is no pollution from the production of Lap Top Bag. Hence, arrangement of pollution control does not arise.

(vi) Energy Conservation:

         The workers should be properly trained to operate the machines as and when required. They should be cautious to yield maximum units during the machine operation and should not be allowed to run the machine by motive power unnecessarily. The electrical line should be properly made and checked at regular intervals.

FINANCIAL ASPECTS:

1. Fixed Capital:

Land & Building Rented – 4000 sq. ft. Rs. 8,000 per month

2. Machinery and Equipment:

Sl.No.Description of Machinery & Equipment Imp/Ind. Qty Nos Rate (Rs.) Value (Rs.)

1. Post bed sewing machine (single Imp. 3 65,000 1,95,000

needle)

2. Cylinder bed sewing machine " 3 70,000 2,10,000

3. Stamping machine Ind. 1 20,000 20,000

4. Strap cutting machine " 1 25,000 25,000

5. Tools & Equipment "     15,000

6.

Electrification & Installation charges@ 10% of the cost of machines

"     45,000

7. Cost of Office equipment "     50,000

Total 5,60,000

3. Pre-operative Expenses Rs. 30,000

         Total Fixed Capital (2+3)                 Rs.5,90,000

WORKING CAPITAL (per month)

(i) Personnel/Technical (per month)

Sl.No. Description No. Salary (Rs.) Total (Rs.)

1. Manager 1 6,000 6,000

2. Supervisor 1 3,500 3,500

3. Mechanic 1 3,500 3,500

4. Accountant-cum-Storekeeper 1 5,000 5,000

5. Clerk-cum-Typist 1 3,000 3,000

6. Peon 1 2,000 2,000

7. Watchman 1 2,000 2,000

8. Machine Operators 6 3,500 21,000

9. Skilled Workers 4 3,000 12,000

10. Unskilled Workers 4 1,500 6,000

Total 64,000

Add perquisites @ 20% on salary 12,800

Grand Total 76,800

(ii) Raw Materials (per month)

Sl.No. Description Qty Rate Amount (Rs.)

1. Imported Rexene 5000 mtrs 400/mtr 20,00,000

2. Lining Rexene 2500 mtrs 150/mtr 3,75,000

3. U Foam Sheets 1250 Nos. 30/sheet 37,500

4. Card Board 1250 Nos. 50/sheet 62,500

5.Grinderies (Zip, Button, Fittings, etc.) 2500 Nos. 100/No. 2,50,000

6.Packing materials per 2500 bags   10/per bag 25,000

Total 27,50,000

(iii) Utilities (per month)

Sl.No. Description Amount (Rs.)

1. Power 4,500

2. Water 500

Total 5,000

(iv) Other Contingent Expenses (per month)

Sl.No. Description Amount (Rs.)

1. Repair & maintenance 1,000

2. Postage and Stationery 1,000

3. Transport charges 2,000

4. Telephone 2,000

5. Advertisement and publicity 2,000

6. Packing & forwarding charges 1,000

7. Insurance 2,000

8. Misc. Expenses 1,000

9. Rent 8,000

Total 28,000

(v) Total Recurring Expenditure (per month)

Sl.No. Description Amount (Rs.)

1. Personnel - Salaries and wages 76,800

2. Raw Materials 27,50,000

3. Utilities 5,000

4. Other contingent expenses 20,000

Total Working capital per month 28,51,800

(vi) Working Capital for 3 months: Rs.85, 55, 400 (Say, Rs.85, 55, 000)

(vii) Total Capital Investment

Sl.No. Description Amount (Rs.)

1. Fixed Capital 5,90,000

2. Working Capital for 3 months 85,55,000

Total 91,45,000

MACHINERY UTILIZATION

         Anticipated utilization of the machinery is about 75% to 90%. All machine operations are important. Hence, it is difficult to cut power supply to any particular machine, which is a bottleneck. However, it can be said that machines such as Sewing Machines occupy an important position in the manufacturing process. Hence, proper control and monitoring is required so that an even flow of production is assured. Moreover, the supervisory personnel should be effective enough to reduce the down time of the machine, carry out regular maintenance of the machines.

FINANCIAL ANALYSIS

(i) Cost of Production (per year)

Sl No. Description Amount (Rs.)

1. Total recurring expenditure per year 3,42,20,000

2. Depreciation on machinery & equipment @ 10% 45,000

3. Depreciation on furniture, fixtures @20% 13,000

4. Interest on Total Capital Investment @ 16% 14,63,000

Total 3,57,41,000

(ii) Turnover (per year)

Sl.No. Description Quantity Rate (Rs.) Value (Rs.)

1. Lap Top Bags 30,000 Nos. Rs.1300/bg 3,90,00,000

(iii) Net Profit per annum (before taxation)

Annual Turn over  3,90,00,000

Cost of Production (-) 3,57,41,000

Net Profit 32,59,000

(iv) Net Profit Ratio:

        = Net Profit x 100 / Turn-over per year

        = 32,59,000 x 100 / 3,90,00,000

        = 8.3 %

(v) Rate of Return on Total Investment

        = Net Profit per year x 100 / Total Capital Investment

        = 32,59,000 x 100 / 91,45,000

        = 36%

BREAK EVEN ANALYSIS:

(i) Fixed Cost

Sl.No. Description Amount (Rs.)

1. Total Depreciation On Machinery 45,000

2. Depreciation on Tools & Equipment 13,000

3. Interest on Total Investment 14,63,000

4. Rent for one year 96,000

5. 40% of wages & salaries 3,68,640

6. 40% of other contingents 57,600

7. Insurance 24,000

Total 30,67,240

BREAK EVEN POINT

B.E.P. = Fixed cost x 100 / Fixed cost + Net Profit

           = 30,67,240 x 100 / 30,67,240+ 32,59,000

           = 30,67,24,000 / 63,26,240

           = 48 %

ADDRESSES OF MACHINERY & EQUIPMENT SUPPLIERS

        1.     M/s. Leather & Packing Machinery Corporation,                1/23B, Asaf Ali Road,                New Delhi 110 02 

        2.     M/s. Harman Sales Union,                24, Kala Bhavan, Mathew Road,                 Mumbai 400 004

        3.     M/s. Srinivasan, No. 32,                Bishop Garden, Chennai 600 028

        4.     M/s. NSIC Technical Services Center,                Sector B.24, Guindy Indl. Estate,                Eakkatuthangal Post, Chennai 600 097

        5.     M/s. Solar, Atur House,                 Worli Nagar, Mumbai 400 018

        6.     M/s. Raj Machine Home,                 35/118-D, Lashkarpur,                 Near Kamala Nagar, Agra 282 005

        7.     M/s Twin Star Engineering,                No.2, Thiruneer Malai Road,                 Pammal, Chennai – 600075

        8.     Apparel & Leather Technics Pvt Ltd                515, Avanashi Road, Tirpur – 641602

ADDRESSES OF RAW MATERIAL SUPPLIERS

        1.     M/s. Valliappa Leather Corporation,                3/5&6, Narayana Chetty Street,                 Periamet, Chennai 600 003

        2.     M/s. T. Abdul Wahid & Co.,                26, Veppery High Road,                 Chennai 600 003

        3.     M/s. Synthokem Industries,                5, Hindi Parachar Sabha Street,                Chennai 600 017 

        4.     M/s. Bharani Agencies,                126, Thumbu chetty Street,                 Chennai 600 001