SUSTAINABILITY

OF AN UNIT
PRECAUTIONS
NEEDED

1 Prepared By Mehak Sharma

SUSTAINABILITY OF AN UNIT; PRECAUTIONS NEEDED

It is observed that many units become sick within a short period of time after
establishment of the time. if problems are identified properly, its cause, symptoms
are also identified the preventive measures can be evaluated very easily. The
problems arise at four different stages.
1. At project formulation stage
2. At project implementation stage
3. At Operational Stage
4. environmental / external factors
Following are the details indicating the cause, symptoms and preventive measures at
4 different stages.
At project formulation stage:

Sr.
No.
1

Cause

Symptoms

Preventive Measures

Wrong choice of
product

- Insufficient /low Sales or

Profit
- More time consumed for
product development
- No sense of achievement
- Reluctance on the part of
financial agencies in
financing the venture.

Poor Assessment of
Technology

- Manufacturing problems
- less output
- Rejections or non-approval
of product specification.
- problem in identifying
required machinery.
- confusion regarding
machinery specifications.

- experts advice
- comparing technology
- studying existing technology/
units.

Sub- optimal Plant

Capacity.

- overtime &pressure of time

- output, but no profits.

-proper balancing of machinery.

- proper production planning
- capacity of Key equipment to
be
decided, based on advantages of
scale

- Frequent break down of

machinery due to
overloading.

2 Prepared By Mehak Sharma

- Proper market survey

- SWOT Analysis: assessing
ones own strengths &
weaknesses in relation to
the venture.
- studying profit/ growth
opportunities of the venture &
possible threats from the
environment for the same.
- consulting a Banker, financial
Institution, Consultancy
Organisation

Locational problems

Poor Market
Assessmentt

Wrong
Investments

Fixed

- Non-availability of
transportation
- Power problems
- Labour problems
- Non- availability of raw
materials or delays in
getting them.
- Reluctance on the part of
Municipal Corporation &
other Agencies in granting
necessary clearance.

- proper study of location

advantages / disadvantages
- planning in advance
- studying rules & regulations
of the authority competent to
issue clearance.

- No order or unexpected
Orders
- Different specifications and
quality
- No repeated orders
- Unremunerative prices
offered by wholesalers
customers.
- Consequently low turnoverprofit ratio.

- Detailed market survey.

- Assessing demand and
supply.
- studying existing / potential
distribution channels.

-Heavy burden of interest

- Large size for status

- Poor utilization of
equipments(idle M/c)
- No one lends when needed
100% loan
- Book loss due to unduly
high depreciation.

- Wrong estimates
- Rented premises
- Job work
-Avoiding over- invoicing or
adjustments in project.
- Exploring all sources of finance
in the beginning
- Reduction of project size (start
with low risk, smaller size
project)

3 Prepared By Mehak Sharma

4 Prepared By Mehak Sharma