Project On Paper Bag

PPR ON PAPER BAG
GENERAL
ASPECT
INDEX
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Sr. no. Particulars
Page no.
1.
Introduction to SSI
2.
Introduction to PPR
3.
Project at Glance
4.
Promoters Background
5.
Justification of Location
6.
Organization structure
10
7.
Vision & Mission
11
8.
Basis & Presumptions
12
9.
Implementation of schedule
13
INRODUCTION TO SMALL SCALE INDUSTRY

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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
The success of any countrys economy largely depends upon the

factors that make up the economy. Industries being the integral and important part
of the countrys economy play a great role in molding the future of the economy.
Industries can be classified into two categories:
Large Scale Industries
Small Scale Industries

The industries whose investment in their fixed assets is more than
Rs. 75, 00,000 but does not exceed, Rs. 3 crore is termed as small scale industries.
Small scale sector or industries is the backbone of the industrial environment in
developing country.
The development of small scale industry is very important for any country,
because it provides employment to many people also small scale industry is the
base for large scale industry as parts or components used by large scale industry is
provided by SSI. It also gives chance to new and young entrepreneur to start the
SSI with very limited capital. Anyone with adequate capital and skills can set up
their own SSI, which would ultimately play a great role in shaping the countrys
economy.
INRODUCTION TO PRODUCT PROJECT REPORT

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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Plastic, although considered as one of the greatest inventions by virtue of its

use in carrying things has become a major element in polluting the
environment.Due to the increasing awareness of the hazards of plastic bags to the
environment among the public and the ban imposed on plastic bags throughout
India and abroad by the governments, there is a great demand for eco-friendly
paper bags. Eco-friendly paper carry bag is the only alternative and the
Government has started encouraging the setting up of paper bag making units.
Since there is lot of demand, paper bag making will certainly be a provider of selfemployment.
Paper bags are the oldest types of packaging material and are very much
prevalent in the modern days in various fields. In fact, paper bag is one of the most
common and popular form of packaging. The handmade bags of paper have been a
commodity of common use. However, for the manufacture of bags, the
introduction of machines is of recent origin about the middle of 19th century.
Since then the manufacture of paper bags has become an important industry in
itself, paper bag is the cheapest form of packaging. Such paper bags have the
specialty that they are light weight, free from any contaminants like dust, and are,
as well, free from shifting or puffing which results in loss of contents. As for the
share occupying these paper bags for general use require minimum possible space
for storage and shipment, both before and after filling.
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Paper bag comes from wood, which comes from trees, which grow in the
earths soil. The trees needed to make paper bag are considered renewable
resources. That means more trees can be planted to take place of trees that are cut
down to make paper and other products. Once paper is made, it can be recycled
and used to create more paper goods. Bags made from paper are bio-degradable
and hence highly environment friendly than plastic bags, which pose a threat to the
environment.
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
PROJECT AT GLANCE
Name of the company

Promoters of the company
Communication address
Registered office address
Phone number
Fax number
Form of organization
Size of the organization
Brand name
Usage of the product
SSI registration no.
Number of employees
Investment
Day off
Source of finance
Owned capital
Borrowed capital
Investment in working capital
Investment in fixed capital
Relationship with bank
Companys slogan
PPB Industry
Kinjallodhiya
Plot No. 228, GIDC,
Lodhika,
Kalawad Road,
Metoda,
Rajkot-360 005.
Premium Paper Bag
7/8 Milpara,
Rajkot (Gujarat), INDIA
+91-281-2227561
+91-281-2227562
+91-281-2223233
Sole proprietorship
Small Scale Industry
Premium Paper Bag
For packing items / Paper carry bags
used for carrying the goods.
Applied for
24
1,75,00,000
Wednesday
10500000
7000000
2118000
15382000
HDFC & ICICI
Designed to be unforgettable
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Companys logo
PROMOTORS BACKGROUND
Name
Age
Address
Education qualification
Experience
Nature of responsibility
Contribution in the unit
Kinjal Lodhiya
24 years
C-191, Ambika appt.
Gandhi Road,
Rajkot (Gujarat)
India
M.B.A Marketing
Fresher
Managing director of the industry
60%
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
JUSTIFICATION OF LOCATION
(1)
Tax Benefit:One reason why the location on has been selected over there was of the
Tax Benefit because it is an industrial area. Tax Benefit is given to motivate

entrepreneurs for expanding the business.
(2)
EASY LABOUR SUPPLY:As the selected location is situated in rural area, the rate of lower class
people is very high. There is an easy availability of labor at low wages, that
ultimate reduce total cost of the product. So, the need of unskilled worker can
fulfill easily.
(3)
SOCIAL RESPONSIBILITY:It is again consider as a part of social responsibility. The location selected is
far distance from the living area of people and we are providing employment to
rural area.
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
(4)
EASY AVAILABILITY OF RAW MATERIALS:

Raw material like Paper, glue, flexo ink &at the same time water, diesel,
power, fuel is also available easily.
(5)
LARGE LAND AVAILABILITY:Large plots of the land are available at area selected which makes factory to
build separate area for store room, office, gate security office etc.
(6)
POWER:As we know it is the foremost thing requires for production process. Here
powers in terms of electricity are available, because factory is situated in an

industrial area. There will be a sufficient power supply and the uniformity in
getting supply can be maintained.
(7)
GOVT. SUBSIDIES & FACILITIES:As the location selected is in the industrial area, govt. help by making
capital, land, Water and power available at subsidies rates. The govt. may give such
facilities as tax exemption, banking, insurance and postal facilities at low rates.
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
ORGANIZATION STRUCTURE
O
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
VISION AND MISSION

A Mission Statement defines the organization's purpose and primary
objectives. Its prime function is internal to define the key measure or measures of
the organization's success and its prime audience is the leadership team and
stockholders.
Vision Statements also define the organizations purpose, but this time
they do so in terms of the organization's values rather than bottom line measures
(values are guiding beliefs about how things should be done.) The vision statement
communicates both the purpose and values of the organization.
THE COMPANYS VISION AND MISSION STATEMENT

Vision statement
Our vision for the millennium remains manufacturing of international
quality products at optimum cost in consistence with the physical and
psychological environment best suitable for customers and stakeholders.
Mission statement
Product quality
Safety and Environment
Satisfaction of customer and stakeholders
Cost Effectiveness
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Energy conservation
BASIS & PRESUMPTION
1. The salary and wages are fixed as per the prevailing rate
2.
The unit is expected to achieve 80% production capacity in the second year
onwards.
3.
Land value and construction cost has been taken on an average basis since it varies
from place to place.
4. No. of shifts :
Working Hours:
2:00 pm
to
Recess time
9:00 am
to
12:00 pm
7: 00 pm
12:00pm
to
2:00pm
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
IMPLEMENTATION SCHEDULE
Sr. No.
1
2
3
4
5
6
7
8
9
10
Particular
Collection of data
Preparation of project report
Loan formalities
Selection of site
Construction of building
Machinery installation
Recruiting personnel
Selection of procurement
Receipt of Raw material
Obtaining power and water connection
Period
2 months
1 month
2 month
1 month
3 month
1 month
1 month
1 month
15 days
1 months
11
and installation of power facilities

Registration of S.S.I.
Total
2 month
15 months
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
TECHNICAL
ASPECT
INDEX
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Sr. no. Particulars
Page no.
1.
Plant Layout
16
2.
Raw Materials
17
3.
Machinery & Equipment
18
4.
Suppliers of Raw materials & Equipment
20
5.
Production Process Flowchart
22
6.
Production Process
23
7.
Production Capacity
25
8.
Plans & Policies
26
9.
Quality Control & Standards
27
Wastage Management
28
10.
PLANT LAYOUT
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
RAW MATERIAL
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
A material or substance used in the primary production or manufacturing of a

good. Raw materials are often natural resources such as oil, iron and wood. Before
being used in the manufacturing process raw materials often are altered to be used
in different processes.
For making Paper bag, the raw materials needed are:-
1.
2.
3.
4.
5.
Any paper in roll form GSM up to 200 and width up to 137 cms ,
Glue, water based Flexo ink,
Eyelets,
Tags for handles,
Polymer stereo.
MACHINERY & EQUIPMENTS
Descriptions of the Paper Bag machine

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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Raw Material: Any paper in roll form GSM up to 200 and width up to 137 cms
,Glue, water based Flexo ink,Eyelets,Tags for handles,Polymer stereo.
Fully automatic Heavy & special type paper bag forming machine with the
following attachment and accessories:
Double color/Four color Flexo Printing unit attachment.

3 H.P. Motor for main drive
Flat type size forming dies and 12 Nos.Gazetted type size forming dies(Size
on at your choice)
Length forming gear wheels
Stereo design rollers and one bag counting unit.
Optional:
Slitting attachment bag hole punching machine (pedal operated)
Back Hole highlighting machine(pedal operated)
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Automatic paper bag making machine.
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
SUPPLIERS OF RAW MATRIAL & EQUIPMENTS

1.Industrial paper M/C (P) Ltd.
A-32, phase-1,
Narayan Ind. Area,
Rajkot.
2. Sandhu Mechanical Eng. Work,
Plot No. 32,
Industrial Area-A,
Surat.
4. Irupal Industrial (Regd.),
728, Industrial Area-B,
Ahmedabad.
5. Kohli Industries, 29,
SonaUdyogIndl. Estate,
Parsipanchyat Road,
Anderi(E), Mumbai-68.
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Suppliers of Raw Materials
1. Punalur Paper Mills,

Plot No.65, Sector-6,
Rajkot.
2. Synthetic Glue Chemicals Ltd.,
406, UshaKiran Building
Commercial Complex,
Rajkot.
3.B.K.Ink Enterprise,.
B.Kumar Compound,
LalBahadurShastriMarg,
Rajkot.
4. Rohtas Industries Ltd.,
376, Shukrawarpeth,
Rajkot.
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
PRODUCTION PROCESS FLOWCHART
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
PRODUCTION PROCESS
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
1) Raw material:
Paper fed into the machine in roll form. Kraft paper isused in roll form up to
220 GSM & B.F. up to 40. Paper Carry Bag Manufacturing process depends
upon the volume and weight of the Products to be carried. Accordingly we
areusing various kinds of Papers with different GSMs and the Bursting
Strengths. We are producing paper carry bags to hold up to 20Kgs.
2) Cutting of paper:
The cutting of roll is done through the automatic paper bag cutting
machine after the paper roll is fed into the machine according to the
decided size of the paper bag.
3) Printing:
At this stage the bags gets printed with the online paper flexo printing unit
attached with the machine. The printing machine used is four color flexo
printing machine.
4) Stereo pressing:
After the printing the paper goes through the chamber in which Different size of
width forming, gazette forming, length forming dies, gear wheels. Stereo wheels
and knives are used to fold and shape the bags into required sizes Brass gum tank
is used for Adhesion.
5) Punching:
After the stereo pressing the punching is done on the bag. At this stage the
machine puts hole on the top of the bag to insert the handle.
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
6) Eyelet fitting:
After punching the eyelet fitting is done through the automatic machine
attached. This eyelet supports the paper from tearing and breaking.
7) Lace fitting:
At the last stage the lace fitting is done on the bag. The different types of lace
are used to make the product attractive.
8) Finished product:
Ultimately it comes to the Bag counting unit and gets counted then stacked
together. Finally the finished product comes out of the machine, and is packed
to sell in the market.
PRODUCTION CAPACITY
Capacity can be defined as:

The maximum output that a business can produce in a given period with the
available resources
Capacity is usually measured in production units. It is unusual for a
business to used all its capacity all of the time.
The proportion of capacity that a business uses is known as capacity
utilization, and it is an important measure of how efficiently a business is
operating.
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
When a business is operating at less than 100% capacity, it is said to have

spare capacity.
Year
Production capacity
Units of production
1.
50%
250000
2.
75%
375000
3.
100%
500000
4.
100%
500000
5.
100%
500000
PLANS & POLICIES
The plans and policies of the company are as follows:-
The timings to reach the campus is 9:00 a.m.

The raw material used should be inspected properly
The appropriate stock should be maintained to meet the contingencies.
The raw materials should be stored in the storage area.
The process of finished products should be completed on time.
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
If there are some defects in the technical part then the management should
be informed within 2 days.
If a problem is created with raw material then the management should be
informed immediately.
Leave will be granted as per the conditions laid with employees.
QUALITY CONTROL & STANDARDS
Today the existence of any manufacturing unit depends on the quality of

products or services it manufactures or supplies. The image or goodwill of any unit
is closely related to the quality of product or services made or supplied by that unit.
Level of quality is the mirror for the manufacturer.
In the beginning Kraft Paper can be used for Paper Carry Bag
Manufacturing process. 100 t0 200 Grams per Square Meter paper and the 16 to
30 bursting strength is the common and standard one.
The printing, proper Adhesion and the Punching of the Eyelets has to be
taken care and inspected in the finished products.
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
WASTAGE MANAGEMENT
The problems relating to disposal of industrial solid waste are associated

with lack of infrastructural facilities and negligence of industries to take proper
safeguards. The large and medium industries located in identified (conforming)
industrial areas still have some arrangements to dispose solid waste. However, the
problem persists with small scale industries. In number of cities and towns, small
scale industries find it easy to dispose waste here and there and it makes difficult
for local bodies to collect such waste though it is not their responsibility. In some
cities, industrial, residential and commercial areas are mixed and thus all waste
gets intermingled. Therefore, it becomes necessary that the local bodies along with
State Pollution Control Board (SPCB) work out requisite strategy for organizing
proper collection and disposal of industrial solid waste.
There is no waste generated as such in the manufacturing of Paper Bag.
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
MARKETING
ASPECT
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
INDEX
Sr. no. Particulars
Page no.
1.
Market Potential
31
2.
Market segmentation
32
3.
Promotional Efforts
33
4.
Pricing Policy
34
5.
Channels of Distribution
36
6.
Competitors
37
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
MARKET POTENTIAL
Market potential is the maximum level of market. It is a function which specifies

the total sales available in the stated market. It points out the quantity of goods
bought by the customers under different possible composite marketing efforts.
Just consider the sheer size of the existing market for plastic carry bags. It
amounts to 600 billion bags. Many governments today are increasingly becoming
environment-sensitive and at least project themselves to be so. Big business too
wants to be seen as eco-friendly.
Several local government bodies such as city municipal corporations and
town-planning bodies have banned usage of plastic bags. In fact in all hill stations
in India, the use of plastic bags has been banned.
Government's decision to impose a blanket ban on the usage and
manufacturing of plastic carry-bags may have hit the manufacturers of plastic bags
in national capital hard, but at the same time it has also generated a huge
opportunity for those engaged in the making of paper bags.
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
One reason to start business in the city was of course the ban on polythene
and the second was to cater to the huge demand generated by the malls in the
city.Establishment of shopping complexes and consumer stores in the rural, semiurban and urban areas, the demand for paper bags has increased.
MARKET SEGMENTATION
The market for any product is normally made up of several segments. A
market after all is the aggregate of consumers of a given product. And, consumer
(the end user), who makes a market, are of varying characteristicsand buying
behavior. There are different factors contributing for varying mind set
ofconsumers. It is thus natural that many differing segments occur within a market.
In order to capture this heterogeneous market for any product, marketers
usuallydivide or disintegrate the market into a number of sub-markets/segments
and theprocess is known asmarket segmentation.
The market segmentation can be done on the following three basis:
Geographical basis
Demographical basis
Psychographic basis
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Themarket segmentation is on the geographic basis.
PROMOTIONAL EFFORTS
Promotion in simple terms means communication of necessary information
to the target market. In todays competitive era, promotional efforts need to be
made to grow and survive in the dynamic and competitive era. There are various
tools to promote the product like advertising, personal selling, sales promotion &
publicity.
The .company will promote the product through advertising in
newspaper and radio.
Choose from our exclusive range of Paper Shopping Bags which are a
natural alternative to harmful plastic bags.
Offering multiple uses, our Paper Bags are not only environment-friendly
but also cost saving as well. Made from high quality materials, our
decomposable Paper Bags are strong and 100% recyclable.
This has made our mark among the major Paper Bags Manufacturers and
Exporters based in India.
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
A perfect mix of utility and value, our versatile collection of bags are longlasting, convenient, exquisite and captivating with a flawless finish.
PRICING POLICY
No matter what type of product we sell the price we charge our customers or
clients will have a direct effect on the success of our business.Though pricing
strategies can be complex, the basic rules of pricing are straightforward:
All prices must cover costs and profits.

The most effective way to lower prices is to lower costs.
Review prices frequently to assure that they reflect the dynamics of cost,
market demand, response to the competition, and profit objectives.
Prices must be established to assure sales.
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Prices are generally established in either ways:

Cost plus pricing
Demand price
Competitive pricing
Skim pricing
High-low pricing
The industry follows the cost plus pricing method to fix the selling price of the
machines. Some of the benefits of cost plus pricing are:1. Easy to calculate
2. Easy to administer
3. Tends to stabilize markets - insulate from demand variations and competitive
factors
4. Insures seller against unpredictable, or unexpected later costs
5. Simplicity
6. It is readily available
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
CHANNEL OF DISRIBUTION
The prime of object of production is its consumption. The movement of product
from producer to consumer is an important function of marketing. It is the
obligation of the producer to make goods available at right place, at right time right
price and in right quantity. The process of making goods available to the consumer
needs effective channel of distribution. Therefore, the path taken by the goods in
its
movement
is
termed
as
channel
of
distribution
CHANNEL OF
DISTRIBUTION.
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Channels are broken into direct and indirect forms, with a "direct" channel
allowing the consumer to buy the good from the manufacturer and an "indirect"
channel allowing the consumer to buy the good from a wholesaler. Direct channels
are considered "shorter" than "indirect" ones.
The company is following..
COMPETITORS
The units engaged in manufacturing of Paper Bag are as under:
Harshan paper bag manufacturing.

Raman industries.
Taihe packaging industry ltd.
Shanghai industrial Co. Ltd.
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
FINANCIAL
ASPECT
INDEX
Sr. no.
Particulars
Page no.
1.
Total Fixed Assets
40
2.
Total Working Capital
43
3.
Total Investment
46
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
4.
Sources of Capital
46
5.
Loan Repayment Schedule
47
6.
Depreciation on Fixed Assets
48
7.
Production & Sales
51
8.
Stock of Raw Material
52
9.
Total Fixed Expenses
52
10.
Total Variable Expenses
53
11.
Total Cost
54
12.
Break Even Point in units
55
13.
Break Even Point in RS.
55
14.
Table of sales
56
15.
Cost Sheet
57
16.
Trading Account for 5 years
58
17.
Profit & Loss Account for 5 years
59
18.
Balance Sheet for 5 years
60
19.
Statement of profitability
73
1. TOTAL FIXED ASSETS

(A)
LAND AND BUILDING:-
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Particulars
Amount
Land
8000000
Production building
50000
Assembling building
2800000
Office building
50000
Storage house
200000
Watchmans cabin
15000
Main gate
30000
Lavatories
60000
Total land & building
11205000
(B) PLANT & MACHINERY:-
Particulars
Amount
Plant and machinery
2900000
Total Plant & Machinery
2900000
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
(C) FURNITURE:Particulars
Qty.
Rate p/u.
Amount
Ordinary table
5000
20000
Computer table
1200
24000
Chairs
10
2500
25000
Sofa sets
15000
30000
Cctv cameras
50000
250000
Computer
25000
50000
Delivery van
50000
100000
Electric fittings
30000
Fans
10
1200
12000
Lights
30
200
6000
Doors & Windows
20
5000
100000
Total Furniture
575400
(D) PRELIMINARY EXPENSES:Particulars
Amount
Consultancy fees
150000
Project report preparation fees
51600
Legal expenses of the company formation
500000
Total Preliminary expenses
701600
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
TOTAL FIXED EXPENSES:-
Particulars
Amount
Land & Building
11205000
Plant & Machinery
2900000
Furniture
575400
Preliminary expenses
701600
Total fixed assets
15382000
2.
TOTAL WORKING CAPITAL
(A) RAW MATERIAL (MONTHLY):Years
Paper rolls
Glue
Monthly data
Total
Qty.
Rate
8000
20
160000
15
90000
6000
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Inks
4000
25
100000
Strings
7000
15
105000
Total
455000
(B) SALARY & WAGES:Particulars

General manager
Factory manager
Supervisor
Cashier
Helpers
Sweeper
Computer operator
Mechanics
Sales man
No.Of
Persons
1
1
2
1
3
2
2
2
2
Amount Per
Month Rs.
14500
12500
5000
5000
1500
1000
3000
3000
3500
Total
Amount Rs.
14500
12,500
10000
5000
4,500
2000
6000
6000
7500
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Storekeeper
Peons
Lab technician
Watchman
Clerk
Total
2
1
1
2
2
2,000
1500
3500
1500
3000
4,000
1500
3500
3000
6000
85500
(C) UTILITIES:Particulars
Monthly Amount
Power
50000
Water
10000
Fuel
30000
Oil and grease
13000
Total utility
103000
(D) OTHER EXPENSES:Particulars
Monthly Amount
Postage & Stationary
2500
Telephone charges
5000
Transportation charges
10000
Advertisement expenses
20000
Insurance
3000
Repair & maintenance
5000
Selling expenses
12000
Other miscellaneous expenses
5000
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Total expenses
62500
TOTAL WORKING CAPITAL:Particulars
Monthly Amount
Raw material
455000
Salary & wages
85500
Utilities
103000
Other miscellaneous expenses
62500
Total working capital
706000
*
3 MONTHS
Total W.C for 3 month months
2118000
3. TOTAL INVESTMENTS
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PPR ON PAPER BAG

T
O
T
A
L
I
N
V
E
S
T
M
E
N
T
S
T O T A L F IX E D A S S E T S
T O T A L W O R K IN G C A P IT A L
4.SOURCES OF CAPITAL
5. LOAN REPAYMENT SCHEDULE
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MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Year
Opening balance
Interest @12%
Closing balance
1.
7000000
840000
6300000
2.
6300000
756000
5600000
3.
5600000
672000
4900000
4.
4900000
588000
4200000
5.
4200000
504000
3500000
6.
3500000
420000
2800000
7.
2800000
336000
2100000
8.
2100000
252000
1400000
9.
1400000
168000
700000
10.
700000
84000
6. DEPRECIATION ON FIXED ASSETS

Name of the asset
Rate of depreciation
48
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Land and building

Plant and machinery
Furniture
Computers
10%
15%
20%
60%
TABLE OF DEPRECIATION FOR 5 YEARS

1stYEAR
Particular
Opening balance
Depreciation
Closing balance
Land& building
(10%)
11205000
1120500
10084500
Plant
machinery
(15%)
2900000
435000
2465000
Furniture (20%)
525400
105080
420320
Computer (60%)
50000
30000
20000
&
Total
1690580
2ndYEAR
Particular
Opening balance
Depreciation
Closing balance
49
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Land
and
building(10%)
10084500
1008450
9076050
Plant
machinery
(15%)
2465000
369750
2095250
Furniture (20%)
420320
84064
336256
Computer (60%)
20000
12000
8000
&
Total
1474264
3rdYEAR
Particular
Opening balance
Depreciation
Closing balance
Land
and
Building (10%)
9076050
907605
8168445
Plant
machinery
(15%)
2095250
314287
1780962
Furniture (20%)
336256
67251
269005
Computer (60%)
8000
4800
3200
&
Total
1293943
4thYEAR
Particular
Opening balance
Depreciation
Closing balance
50
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Land
and
Building (10%)
8168445
816845
7351600
Plant
machinery
(15%)
1780962
267144
1513818
Furniture (20%)
269005
53801
215204
Computer (60%)
3200
1920
1280
&
Total
1139710
5thYEAR
Particular
Opening balance
Depreciation
Closing balance
Land and Building

(10%)
7351600
735160
6616440
Plant & machinery

(15%)
1513818
227073
1286745
Furniture (20%)
215204
43041
172163
Computer (60%)
1280
768
512
Total
1006042
7. ESTIMATED PRODUCTION AND SALES (IN UNITS)

51
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
ESTEMATED PRODUCTION:-
(A)
Year
Production capacity
Units of production
1.
50%
250000
2.
75%
375000
3.
100%
500000
4.
100%
500000
5.
100%
500000
(B)
ESTIMATED SALES:Year
1
2
3
4
5
Opening
Stock
0
25000
37500
50000
50000
Production
Sales
250000
375000
500000
500000
500000
225000
362500
487500
500000
500000
Closing
Stock
25000
37500
50000
50000
50000
8. STOCK OF RAWMATERIAL (IN UNITS)

Particulars
Opening stock
Year-1
0
Year-2
54600
Year-3
81900
Year-4
109200
Year-5
109200
52
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Add: Purchases
Less: consumption
Closing stock
546000
491400
54600
819000
791700
81900
1092000
1064700
109200
1092000
1092000
109200
1092000
1092000
109200
9. TOTAL FIXED EXPENSES

Expenses
Amount
Salary & wages (60%)
51300
Utilities (50%)
51500
Other expenses (70%)
43750
Total fixed expenses
146550
Total
Fixed cost per unit =
Expenses
Production at 100 capacity
1758600
500000
= Rs.3.52
10. TOTAL VARIABLE EXPENSES
53
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Particulars
Amount
Raw materials(100%)
Salary and wages (40%)
Utilities (50%)
Other expenses (30%)
45500
34200
51500
18750
178950
Total
Variable cost per unit =
Total Variable Expenses

Production at 100 Capacity
1799400
500000
=Rs. 3.60
11. TOTAL COST
54
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG

T
O
T
L
F
X
E
D
E
X
P
E
N
S
T
T
L
V
A
I
R
A
L
E
P
N
E
T
O
T
A
A
I
L
C
O
S
T
B
E
X
E
S
Total cost per unit
O
A
Total Cost
Production at 100 Capacity
3558000
500000
= 7.116
12. BREAK-EVEN POINT (IN UNITS)

55
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Total
Break Even Point (in units) =
Expenses
Selling Pricevariable Expenses
1758600
103.60
= 274781 units
13. BREAK-EVEN POINT (IN RS.)

BEP (in Rs.) = BEP in units * Selling price per unit
= 274781 * 10
= 2747810
14. TABLE OF SALES

56
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Year
Production
capacity
1
2
3
4
5
50%
75%
100%
100%
100%
Sales
( in unit)
225000
362500
487500
500000
500000
Selling
price (per
unit)
10
10
10
10
10
Total Sales
2250000
3625000
4875000
5000000
5000000
15. COST SHEET FOR FIVE YEARS

57
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Particular
Raw material
+ salary and wages
= prime cost
+ factory exp.
Fixed utility
+variable utility
+dep. on plant &
machinery
=total factory cost
+ office exp.
Salary & Wages
+other exp.(fixed)
+Dep. On land
-building
+dep. On furniture
+dep on computer
=total office cost
+op.stock of finished
goods
= total
-Cl. Stock of
finished goods
=cost of production
+ variable other
expense
=TOTAL COST
+Profit
=SALES
1
546000
34200
580200
2
819000
51300
870300
3
1092000
68400
1160400
4
1092000
68400
1160400
5
1092000
68400
1160400
51500
51500
435000
51500
77250
369750
51500
103000
314287
51500
103000
267144
51500
103000
227073
1118200
1343050
1577687
1530544
1490473
51300
43750
1120500
51300
43750
1008450
51300
43750
907605
51300
43750
816845
51300
43750
735160
105080
30000
2068830
-
84064
12000
2542614
250000
67251
4800
2652392
375000
53801
1920
2498160
500000
43041
768
2354492
500000
2066830
250000
2792614
375000
3027392
500000
2998160
500000
2854492
500000
1818830
2417614
2527392
2498160
2354492
18750
28125
37500
37500
37500
1837550
412420
2250000
2445739
1304261
3750000
2564892
2435108
5000000
2535660
2464340
5000000
2391992
2608008
5000000
58
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
FINAL ACCOUNT
Trading account 1st
Trading account of PPB Industry for the year ending
2014-15.
Particular
Amt.
Particular
To opening stock
0 By sales
Raw material
0 By closing stock
Finished goods
0 Raw material
To purchase of
raw material
To salary & wages
To utilities
To gross profit (G.P.)
Amt.
2250000
1092000
546000 Finished goods 250000
1342000
34200
51500
2960300
3592000
3592000
59
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Profit and loss account 1st

Profit and loss account of PPB Industry for the year ending
2014-15.
Particular
Amt.
Particular
To salary & wages
51300 By gross profit
To utilities
51500
To other expenses
62500
Amt.
2960300
To depreciation
Land &Building
1120500
Plant & machinery
435000
Furniture
105080
Computers
To interest on capital
To provision for tax
To net profit(N.P.)
30000
630000
6260
6260
2960300
2960300
Balance sheet 1st

Balance sheet of PPB Industryas on year ended 2014-15.
60
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Liability
Rs.
Owned capital= 10500000

Add: int. On capital=
Net profit
Creditors
Provision for tax
11205000
Less: Dep.=
11136260
P&M
Less: Dep.
Bank loan
Rs.
Land & bldg..=
630000
=6260
Assets
7140000
435000
2465000
525400
= 105080
Computer =
Less: Dep.
10084500
= 2900000
Furniture =
17480 Less: Dep.

6260
1120500
420320
50000
30000
20000
Closing stock:
Raw material = 1092000
Finished goods=250000
Debtors
18300000
1342000
3266580
701600
18300000
Trading account 2nd
61
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG

2015-16.
Particular
Amt.
To opening stock
Raw material
Particular
By sales
3750000
1092000 By closing stock
Finished goods
250000 Raw material
To purchase of
raw material
To salary & wages
To utilities
Amt.
1636000
2013000
51300
77250
2131450
5763000
5763000
Profit and loss account 2nd

2015-16.
62
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Particular
Amt.
Particular
To salary & wages
To utilities
51500
To other expenses
71875
Amt.
2131450
To depreciation
Land &Building
1008450
Plant & machinery
369750
Furniture
84064
Computer
12000
334086
74212
To net profit(N.P.)
74212
2131450
2131450
Balance sheet 2nd

Liability
Rs.

334086
Assets
Rs.
Land& bldg.=
10084500
Less: Dep.=
1008450
9076050
63
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG

Net profit
= 74212
11544558
P&M
Less: Dep.
Bank loan
5675600
Creditors
74212
Furniture =
428320 Less: Dep.
Provision for tax
= 2465000
Computer =
Less: Dep.
369750
2095250
420320
84064
336256
20000
12000
8000
Closing stock:
Raw material =1638000
Debtors
2013000
3000000
631440
Cash on hand
856640
18016636
18016636
Trading account 3rd

2016-17.
Particular
To opening stock
Raw material
Amt.
Particular
By sales
Amt.
5000000

64
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Finished goods
To purchase of
375000 Raw material
2184000
2684000
raw material
To salary & wages
To utilities
68400
103000
4407600
7684000
7684000
Profit and loss account 3rd

2016-17.
Particular
Rs.
Particular
To salary & wages
51300 By Gross profit
To utility
51500
To other expenses
81250
Rs.
4407600
To depreciation:
65
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Land &Building
917605
Plant & machinery
314287
Furniture
67251
Computer
4800
346337
1291635
To Net profit
1291635
4407600
4407600
Balance sheet 3rd

Liability
Rs.

Net profit
Land& bldg..=
346337
=1291635
Assets
13182530
Creditors
5572000
9076050
Less: Dep.=
907605
P&M
= 2095250
Less: Dep.
Bank loan
Rs.
Furniture =
649433 Less: Dep.
314287
8168445
1780962
336256
67251
269005
66
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG

Provision for tax
1291635
Computer =
Less: Dep.
8000
4800
3200
Closing stock:
Raw material = 2184000
2684000
Debtors
3000000
Cash in hand
3000000
19396732
491120
19396732
Trading account 4th

2017-18.
Particular
Amt.
To opening stock
Raw material
Finished goods
To purchase of
Particular
By sales
Amt.
5000000

500000 Raw material
2184000
2684000
raw material
To salary & wages
68400
67
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
To utilities
103000
3736600
7684000
7684000
Profit and loss account 4th

2017-18.
Particular
Rs.
Particular
To salary & wages
51300 By Gross profit
To utility
51500
To other expenses
81250
Rs.
3736600
To depreciation:
Land &Building
Plant & machinery
Furniture
267144
816845
53801
68
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Computer
1920
395476
1008682
To Net profit
1008682
3736600
3736600
Balance sheet 4th

Liability
Rs.

Net profit
Land& bldg..=
395476
=1008682
Assets
14586688
Creditors
Provision for tax
4258800
816845
P&M
= 1780962
=
Furniture =
667308 Less: Dep.

1008682
8168445
Less: Dep.=
Less: Dep.
Bank loan
Rs.
267144
53801
Computer =
3200
1513818
269005
Less: Dep.
7351600
1920
215204
1280
Closing stock:
69
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG

2684000
Debtors
3500000
Cash in hand
3500000
20521478
420960
20521478
Trading account 5th

2018-19.
Particular
Amt.
To opening stock
Raw material
Finished goods
To purchase of
Particular
By sales
Amt.
5000000

500000 Raw material
2184000
2684000
raw material
To salary & wages
To utilities
68400
103000
3736600
70
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
7684000
7684000
Profit and loss account 5th

2018-19.
Particular
Amt.
Particular
To salary & wages
To utilities
51500
To other expenses
81250
Amt.
3736600
To depreciation
Land &Building
735160
Plant & machinery
227073
Furniture
Computers
43041
768
437601
1054454
71
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
To net profit(N.P.)
1054454
3736600
3736600
Balance sheet 5th

Liability
Rs.

Net profit
Land& bldg..=
437601
=1054454
Assets
16078743
Creditors
Provision for tax
3550400
735160
P&M
= 1513818
=
227073
Furniture =
215204
572937 Less: Dep.

1054454
7351600
Less: Dep.=
Less: Dep.
Bank loan
Rs.
Computer =
Less: Dep.
43041
6616440
1286745
172163
1280
=
768
512
Closing stock:
2684000
Debtors
4500000
Cash in hand
4500000
350800
72
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
21256534
21256534
STATEMENT OF PROFITABILITY FOR FIVE YEARS
Particulars
2250000
3625000
4875000
5000000
5000000
-Variable exp.
18750
28125
37500
37500
37500
Contribution
2231250
3596875
4837500
4962500
4962500
43750
43750
43750
43750
43750
Earnings Before
Interest and Tax
(EBIT)
-Interest on loan
2187500
3553125
4793750
4918750
4918750
840000
756000
672000
588000
504000
Earnings Before
Tax(EBT)
-Taxes
1347500
2797125
4121750
4330750
4414750
6260
74212
1291635
1008682
1054454
Profit After Tax

(PAT)
1341240
2722913
2830115
3322068
3360296
Sales
-Fixed cost
73
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
RISK FACTOR
There is always risk of competition from existing & potential units.

Unavailability of raw materials.
Introduction of some new eco-friendly material other than paper.
74
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
SWOT ANALYSIS
STRENGTH: Large and growing domestic market.

Availability of personnel across all levels.
It is eco-friendly in nature.
Lower price.
Fewer competitors.
Quality of product.
Use of modern technology.
Current fashion trend.
WEAKNESS: Plant capacity

It is not useful inMonsoon season
Less advertising effort
Small and fragmented industry structure.
75
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
Technology fatigue resulting in sub- optimal capacity utilization.
OPPORTUNITIES: Increasing awareness of hazards of plastic.

Ban imposed on plastic bags in many states.
This is something which will never end.
Packaging and visibility provides companies the added advantage.
THREATS: Government policies

Increase raw material price.
Delay in plantation growth and deficit of wood fiber.
76
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
FUTURE PLANS
The company wants to increase its sales in future by covering the maximum
share of the market.
In future company is deciding to establish branch in the metro city so that
maximum people become the customer of the company.
To maintain the quality of the paper bagand bringing more dimension to it.
77
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
CONCLUSION
To set up any new unit and to run it smoothly it is not an easy task to handle.
Moreover, in this competitive world, to stand in market for long time with desired
Profit is not an easy task for any entrepreneur. It is more important for government
to increase efficiency of SSI sector as they are the main sources for providing raw
material to the large scale sectors.
In the product project report on premium paper bag, I have discussed all financial
data and other relevant information.
The demand for the paper bag is expanding & the return in this business is also
satisfactory. At last it can be said that future of this product is very bright.
With the expectation of high profitability and good implementation of project, it is

assumed that it would be the perfect product to be manufactured in today's
environment.
78
MVM COLLEGE, RAJKOT
PPR ON PAPER BAG
REFERNCES
www.wikipedia.com
www.scribd.com
www.qfinance.com
79
MVM COLLEGE, RAJKOT

Project On Paper Bag

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PPR ON PAPER BAG

MVM COLLEGE, RAJKOT

PPR ON PAPER BAG

Sr. no. Particulars

Vision & Mission

Basis & Presumptions

INRODUCTION TO SMALL SCALE INDUSTRY

MVM COLLEGE, RAJKOT

PPR ON PAPER BAG

The success of any countrys economy largely depends upon the

Large Scale Industries

Small Scale Industries

INRODUCTION TO PRODUCT PROJECT REPORT

MVM COLLEGE, RAJKOT

PPR ON PAPER BAG

Plastic, although considered as one of the greatest inventions by virtue of its

MVM COLLEGE, RAJKOT

PPR ON PAPER BAG

MVM COLLEGE, RAJKOT

PPR ON PAPER BAG

Name of the company

Registered office address

MVM COLLEGE, RAJKOT

PPR ON PAPER BAG

MVM COLLEGE, RAJKOT

PPR ON PAPER BAG

Tax Benefit because it is an industrial area. Tax Benefit is given to motivate

MVM COLLEGE, RAJKOT

PPR ON PAPER BAG

EASY AVAILABILITY OF RAW MATERIALS:

power, fuel is also available easily.

powers in terms of electricity are available, because factory is situated in an

MVM COLLEGE, RAJKOT

PPR ON PAPER BAG

MVM COLLEGE, RAJKOT

PPR ON PAPER BAG

VISION AND MISSION

THE COMPANYS VISION AND MISSION STATEMENT

MVM COLLEGE, RAJKOT

PPR ON PAPER BAG

BASIS & PRESUMPTION

MVM COLLEGE, RAJKOT

PPR ON PAPER BAG

and installation of power facilities

MVM COLLEGE, RAJKOT

PPR ON PAPER BAG

MVM COLLEGE, RAJKOT

PPR ON PAPER BAG

Sr. no. Particulars

Machinery & Equipment

Suppliers of Raw materials & Equipment

Production Process Flowchart

Plans & Policies

Quality Control & Standards

MVM COLLEGE, RAJKOT

PPR ON PAPER BAG

MVM COLLEGE, RAJKOT

PPR ON PAPER BAG

A material or substance used in the primary production or manufacturing of a

For making Paper bag, the raw materials needed are:-

MACHINERY & EQUIPMENTS

Descriptions of the Paper Bag machine