Zarmeen's Collection

DEDICATION

First of all we are thankful to our Almighty Allah for making

us able to complete this project. We are also thankful to our
teacher for imparting us the knowledge and for his
encouragement. Last but not the least we are thankful and
indebted to our parents with out whose support we would not
be, where we are. We are helpful that this Endeavour of ours
will be fruitful. We dedicate this project to our Honorable
teacher and our parents.

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 Zarmeen's Collection

Executive Summary

Our Boutique Zarmeens Collection is newly established in Bahawalpur City in

Satellite Town. We focus on the establishment of designer wear Boutique
including the operations of apparel designing, manufacturing, selling and
marketing. This Project has been designed to capture the dynamics of the
Boutique industry in Bahawalpur and other big cities of Pakistan like Lahore,
Islamabad, Karachi, Faisalabad etc, with its many components and possible
strategic opportunities. This Project is financed with debt equity ratio of 60:40.
The Average Installed capacity of our product is 50% with 8400 dresses annually.
The internal rate of return is approximately is 78%.

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 Zarmeen's Collection

EMBROIDERY:
Embroidery is one of the most sought out handicrafts of Pakistan the world over.
Multan, Bahawalpur and surrounding areas are full of gifted men and women
who produce one of the most adorable cross stitch. "Tilla" work, Pearl work and
"Salma Sitary" work of NWFP are very famous throughout the country. Swat is
well-known due to thread embroidery, whereas, in D.G.Khan mirror work is
done on clothes. Works of these types are called "Kadhai." Chitrali "Patti," that is
woven on hand looms and Kadhai done on Chitrali Chugha is very famous

What is embroidery?

Embroidery is the art or handicraft of decorating or making things

Types of Embroidery

Following are some types of embroideries in Pakistan as well as in our neighbor

country India.

Zardozi Embroidery:
As far as the world of design is concerned, embroidery is the backbone of Pakistan. Some of
our embroideries that can do wonder for Zardozi embroidery.

Zardozi work is an ancient form of embroidery basically done with gold or silver zari
threads. It is also known as metal embroidery. Although now-a-days it is also done with
colored metal threads. The word Zardozi is derived by combining two words Zar and Dozi
which in Persian language means gold and embroidery respectively. Therefore it is clear
that this art of embroidery was originated in Persia which was bought to India by Moghuls.

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 Zarmeen's Collection

Initially it was done with real metal threads of gold and silver. It was done on clothes for
the rich and royal, wall hangings, bedsheets, etc. In between the application of pearls and
precious stones looks stunning on it. Basically it is done on silk, crepe, brocade and velvet
fabrics. Zardozi embroidery saw its decline during the reign of Aurangzeb. It was revived
after the independence.

Mirror Embroidery:

This work also originated in Persia during 13th century. Mirror work is never done alone, it
is generally in combination with other types of stitches or embroideries. This embroidery is
done with both large and small mirrors. It is embroidered using colorful threads like red,
green, blue, yellow, black, maroon, etc.

Kantha Embroidery

Kantha is the traditional form of embroidery of West Bengal. It is running style of stitch. The
embroidery is done on many layers of cloth. It is done on quilts, bedsheets, blankets, saris,
salwar suits, stoles, napkins, etc.

It is also known as Dorukha. This word means making worn out garments into beautiful
garments. Therefore it is also known as recycling art. In earlier times the worn out silk or
muslin clothes where used to be put in piles and stitched together. It is believed that its date
of origin lies during the era of Lord Buddha. They used to drape themselves with rags of
clothes that were stitched together.

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 Zarmeen's Collection

Chikankari Embroidery

Chikankari is derived from the word Chakeen that means elegant patterns on the fabric
which is a Persian word. Earlier it was done with white thread on muslin clothes. However
now it is been done on various types of fabrics like cotton, linen nylon, georgette, chiffon
and synthetic fabrics. Apart from wearable garments it is also done on various other things
like curtains, bed sheets, table cloths, pillow covers and cushion covers.

Unlike earlier times it is not only done on white colored cloths but also fabrics of various
colors. But the thread used for the embroidery is generally white. Various motifs are
embroidered through it like floral motifs which include flowers like rose, lotus, jasmine,
creepers, etc.

Sindhi Embroidary

sindhi embroidery is very famous all over the Pakistan including sindhi topi, ajrak. Sindhi
embroidery made on dresses.
It is made with the help of many types of threads and in in different colours on different
fabrics.
Phool patti Work

Phool patti work is popular in allover the pakistan & it need no special machines. It is done
with the help of needles not with machines. It is done with different colours threads and on
different fabrics.

TYPES OF EMBROIDERY
As far as the world of design is concerned, embroidery is the backbone of Pakistan. Some of
our embroideries that can do wonders for an outfit are:

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 Zarmeen's Collection

Mirror Work Mirror work which has its roots in Rajasthan and Kutch.

Lari Fine quality gold thread embroidery found in Bareilly , Benaras ( Varanasi
), Lucknow and Agra. These days silver zari is equally popular.

Phool Patti Work Applique work from Aligarh where usually organdi or other fabric cutouts
in floral and leaf motifs are affixed on to a plain fabric sometimes in
tandem with silver tilla embroidery.

Chikan Work Originating from Lucknow this involves a technique of finding separated
warp and weft threads for a textural effect.

Jaali Network.

Zardosi Leaf-scroll worked in gold and silver thread on silk, satin, velvet and
other rich fabrics. Zardosi is also combined with Dabka work and is
originally from Lucknow.

Mokaish Silver dots strewn all over is Mokaish work.

Sitara Work Sequins are embroidered into the fabric.

Product Mix
Designers dresses for men and women,

Matching Ladies Bags

Ladies and gents Matching Shoes
Matching Jewelry
Embroidery dresses will design and manufactured in the boutique while
Bags, shoes and jewelry will be purchased on order form other Suppliers.

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 Zarmeen's Collection

Suppliers
Stylo Shoes, Service shoes & Borjan shoes will provide us with matching
ladies and gents shoes. We will Order for matching bags to Sanat Zaar
Embroidery School. Jewelry will be purchased from main market of
Bahawalpur.

Installed Capacity
The Boutique business capacity is greatly dependent on the market size and
the number of potential clientele one can attract. Furthermore, the women
fashion wear garments will be designed through a contracted designer and
then stitched through in-house stitching unit. On average Installed capacity
of our Product is 60%..700 dresses will be manufactured in one month to
sale in Boutique. While Embroidery work on Order will also be taken from
in and outside the city.

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Estimated Production during the first Year

With in 1 year approximately 8400 dresses will be produce in boutique for
sale. Orders are exceptions from this production.

Cost of Project
Description Rs.
Fixed Initial cost 9990320
Initial Working Capital 13773350
Total 23763670

Means of Finance

Description Amount
Debt:Eqity Ratio 60:40
Amount of Debt 14.258202
million
Amount of Equity 9.505468
million

Name of Financial Institution

Habib Bank Limited Bahawalpur

Rate of Interest 18%

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 Zarmeen's Collection

Sponsors and Machinery Suppliers

Name of Sponsors
Machinery Suppliers
Sponsor Stake
Zarmeen, Zareen
Ahmad and Sons Traders
Fauji Trading Corporation
Hafiz and Karim Trading Corporation
40%

Financial Ratios & Net Profit Margin

Year 2010 2011 2012 2013 2014
Current Ratio 87.59 147.08 220.42 308.53 412.41
Debt as %-age of total capital. 60.00% 39.36% 23.39% 12.30% 4.87%
Net Margin (%) 22.83% 26.84% 29.58% 32.03% 34.21%

IRR:
Internal Rate of Return 78%

Payback Period:
Payback Period (Years) 0.2072

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Introduction of Business:

Our boutique is established in 2009 to compete the market of embroided

dresses, shoes, hand bags etc. Its a partnership type business started by 2
members Zarmeen & Zareen. They started this business with huge
investment for the purpose of this business is to make embroided dresses
and to sell these in market and as well as we sell the readymade hand bags,
shoes, jewellary in our boutique to enhance sale & to attract customer that an
opportunity to collect their relevant shopping from our boutique.
We also sell hand bags, jewellary, matching shoes but we not made these but
purchase these from market we mostly purchase shoes from Stylo, Borjan,
Bata shoes.
We collect jewellary from akram Awn shopping center, Takbeer shopping
mall, Ace shopping mall etc.

Technical Analysis
In our boutique 10 embroiding machines, 20 single needle locking macines,
10 over lock stitching machine are present for the purpose of embroidery
dresses with the handmade embroidery dresses. In this simple machines are
used having not very expensive.
Inputs required are:-
Fabric
Electricity
Single needle lock stitch Machines
Embroidery machine
Scissors

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 Zarmeen's Collection

Cutting board
Embroideries accessories

In technical analysis following is production process flow described as well

as shown in a diagram

Design:

Pattern Making/Cutting
Stitching:
Finishing:

Presentation/Market:

Embroidery
Designing Pattern Making

Finishing
Stitching Cutting

Market/
Clientele Presentation

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 Zarmeen's Collection

Personnel Analysis
In our boutique following is description of personnel
Chief executive
Designers
Sales girls
Product supervisor/ cutting master
Iron man
Office boy
Above all these personnel these include all technical & non-technical
personnel but at the same time there is no special need of technical
knowledge except designer who need some technical knowledge in computer
for innovating new designs day by day.

SWOT ANALYSIS

Strengths

Our Boutique would be the first big boutique in Bahawalpur city The labor
to manufacture embroidery dresses is easily available we can reach easily to
low cost labor. Moreover the location for our project is very attractive. We
can avail maximum advantage from this market.

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 Zarmeen's Collection

Weaknesses

Our weakness is that we are not manufacturing other accessories like bags,
shoes etc at initial stage. And we have to rely on other contractors for these
accessories. But with the passage of time we will hopefully enter in
Matching Bags and Shoes Business as well.

Opportunities

Clothing is a beautiful visual demonstration of the social and emotional

needs of people wearing it. It also portrays in a clearly understood visual
manner, what people of different cultures and styles want socially. Fashion,
through times, has gone through so many rapid changes and bizarre extremes
that it has examples of nearly every kind of clothing function.
The range of Pakistani dresses is remarkably wide, according to the vast
cultures, geographical differences, purchasing capacities, influence of the
western culture, and bewildering diversities of the ethnic groups. One has,
therefore, to sift and isolate, and then relate and bring together, the ideas for
creating various designs, which can fit in the context of the fashion in vogue
and the culture in practice. Furthermore, there is massive export potential in
this sector, as the demand of Pakistani dresses, especially in countries like
UAE, USA, and UK, is massive due to a high number of Pakistani
expatriates who have settled in these countries. The Boutique business can
also be expanded into a more profitable venture by providing stitching

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 Zarmeen's Collection

facilities to other boutiques, which do not own a stitching unit or are lacking
this facility.
Threats

Competitive Structure of the market

The market of the boutiques is highly competitive; therefore if the
entrepreneur is
not well responsive to the tastes and response of the clientele as well as the
fashions
in vogue he/she may not be able to capitalize the opportunity properly.

Pilferage in the designs

The designs which a designer produces can be sold by the staff even before
that Design is launched and that can pose serious threat to the business
because in the Fashion industry it is the uniqueness of the design which
matters.
Selection of the wrong venue
Selection of the wrong venue can be a major hurdle in achieving the desired
business objectives.
Selection of the wrong design
If the designs are not selected according to the tastes of the clientele then it
can be detrimental for the business, so the clientele taste should be properly
tracked.

Tax
Improper documentation of the sales receipt record may lead to problems
with Tax department.

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 Zarmeen's Collection

MARKETING

The marketing of boutique follows the conventional marketing pattern which

is dependent on selection of venue of the outlet/s and the product mix
(designs and sizes), as well as the promotional strategy. We are using
following medium to promote our product.
1) Usage of print media i.e. printing of posters and pamphlets as well as
displaying it and distributing it at proper places
2) Advertisement in print media i.e. newspapers and fashion magazines, etc.
3) Usage of electronic media i.e. projection of the boutique in fashion
programs, Advertisement on television, and provision of dresses to various
television plays and films.
4) Event arrangement like fashion shows and photo-shoots.
5) Usage of e-commerce i.e. launching of website and advertising on web.

List of Machinery
Machinery No
Single needle Lock stitch machine 20
Over Lock Stitch Machine 10
Embroidery Machine 10
Accessories (Scissors, Cutting Board,
Table, Stool, Carpet etc
Other Equipments
Air Conditioner 2
Stereo System 1
Computer and Printer 5
Telephone 2
Security System( Cameras and television) 3

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 Zarmeen's Collection

Raw Material:
The raw-material required for such sort of projects, would be as follows:

Fabric: The fabric, which is the basic raw material requirement for a
boutique and a major component of the cost, can be obtained from wholesale
markets or from markets specializing in designer cloth at Faisalabad,
Karachi, and Lahore.

Accessories: Accessories such as buttons, laces, zippers, elastics, threads,

needles, embroidery threads, glasses, etc. will be procured from the local
market at competitive rates.

Labels, tags and packaging: Labels and tags can be obtained on order, as
these serve as an identity for the boutique and are useful for promotion.

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 Zarmeen's Collection

Personnel:
Requirement of Staff:

Production Staff

Designer 5

Product Supervisor/Cutting Master 5

Snitchers/Tailors 4

Press/Iron Man 5

Finishing Man 2

Administrative Staff:

Chief Executive Officer/Owner 2

Sale Girls 8

Office boy 3

Total 34

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 Zarmeen's Collection

Infrastructure Requirement
The project will have the following infrastructure components:
Infrastructure Requirement

Description Sq.ft
Main shop (30x30)
Bags Deptt (15x4)
Shoes Deptt (15x4)
Jewelry Deptt (15x4)
Try Room 2, (4x5)
Office 7x7
Store Basement
Building for Stitching Unit 10 Marla House

Try room
Try room

4x5 15x4 Bags shop 4x5

30z30
15x
15x 4
4 Sho
Jew es
lry

7x7
0ffice

30x30 Entrance

Main Shop Structure

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 Zarmeen's Collection

Financial analysis

Cost of the Project

Foreig
Description Local Total
n
Lease Expenses (shop) 1000000 0 1000000
Furniture and Fixture
((interior Decration) 500000 0 500000
Machinery and Equipment. 6955000 0 6955000
Security Deposit for Stitching
house. 108000 0 108000

Pre-operating
Expenses:
Staff's 1month Salaries. 442000 0 442000
Promotional Expenses 985320 0 985320
Total Pre Operating
Expenses 1427320

Total capital cost 9990320

Working Capital:

Raw Material (Fabric and

Accessories) 7244600 0 7244600
Cost Incurred on Bags, Shoes,
Jewellery 4365000 4365000
Account Recivable 5% of
sales 1767750 0 1767750
Advance Rent (Boteque and
Stitching house) 396000 0 396000
Total Working Capital 6528750 0 13773350

Total Project Cost 23763670

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 Zarmeen's Collection

Means of finance
Debt and Equity
Debt:
Long term Loan 14258202

Total Debt 14258202

Equity:
Paid-up-Capital 9505468

Total Equity 9505468

Total Debt and Equity 23763670

Debt : Equity Ratio 60:40

Project Returns
Description Rate
Internal Rate of Return 78%
Payback Period (Year) 0.2072

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 Zarmeen's Collection

Zarmeens Collection
Projected Income Statement

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 Projected
Zarmeen'sIncome Statement
Collection

Year 2010 2011 2012 2013 2014

Description

Sales 35355000 38890500 42779550 47057505 51763256

Cost of Goods
Sold:
Raw Material 4809000 4857090 4905661 4954718 5004265
Embridory and
Accessories costs 2435600 2459956 2484556 2509401 2534495

RawMaterial,Embriodry
and Accessory 7244600 7317046 7390216 7464119 7538760

Purchase of Bages ,
Shoes and Jewellery 4365000 4474125 4585978 4700628 4818143
Machine Maintanece 25000 27500 30250 33275 36603
Payroll Production staff. 3420000 3762000 4138200 4552020 5007222
Direct Electricity 120000 132000 145200 159720 175692

Total 15174600 15712671 16289845 16909761 17576420

Gross Profit 20180400 23177829 26489705 30147744 34186836

Operating
Expenses:
Fixed Electricity 144000 158400 174240 191664 210830
Payroll Administration 1884000 2072400 2279640 2507604 2758364
Shop and Stitching
House rent 396000 415800 436590 458420 481340
Amortization pre
Operating Expense 142732 142732 142732 142732 142732
Telephone, Internet
Charges 84000 88200 92610 97241 102103
Promotional Expenses 1060650 583358 641693 705863 776449
Depriciation 1093250 1093250 1093250 1093250 1093250
Total 4804632 4554140 4860755 5196773 5565069

Operating Profit 15375768 18623690 21628950 24950971 28621767

Non-Operating
Expenses:
Fnancial Charges 2566476 2053181 1539886 1026591 513295
Total 2566476 2053181 1539886 1026591 513295

Profit Befor Tax 12809292 16570508 20089064 23924381 28108472

Tax 4739438 6131088 7432954 8852021 10400135

1507236 1770833
Net Profit After tax 8069854 10439420 12656111 0 7

Operating Retained
Earnings 0 8069854 18509274 31165385 46237744
Retained earning - 22 -
beginning of year 8069854 18509274 31165385 46237744 63946082
 Zarmeen's Collection

Zarmeens Collection
Projected Cash Flow Statement

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 Year 2009 Zarmeen's
2010 Collection2012
2011 2013 2014
Description
Operating
Activities:

Net Profit 8069854 10439420 12656111 15072360 17708337

Amortization of
Preoperating
Expenses 142732 142732 142732 142732 142732
Security Deposits (1108000)
Building Rent
Expenses 396000 415800 436590 458420 481340
Building Rent
Repayments (396000) (415800) (436590) (458420) (481340) (505407)
Depriciation 1093250 1093250 1093250 1093250 1093250
Stock and
Inventory(Embriodry
dresses and
Bags, Shoes,
Jewellery) (11609600) (307435) (338178) (371996) (409196) (450115)
Account Recievable (1767750) (265163) (304937) (350677) (403279) (463771)
Account Payable 144270 1443 1457 1472 1486

Cash Provided By (14881350

Operations ) 8857708 11012940 13149047 15474418 18007853

Financing
Activities:

Share Capital 9505468

Adition To Long Term
Debt 14258202
Long term Debt
Repayment (2851640) (2851640) (2851640) (2851640) (2851640)
Short Term Debt
Repayment

Cash Provided/used
for financing
Activities 23763670 (2851640) (2851640) (2851640) (2851640) (2851640)

Investing
Activities:

capital Expenditure (8882320) 0 0 0 0 0

Cash Used,
Provided by
Investing Activities (8882320) 0 0 0 0 0

Net Cash 600606 1262277 1515621

Inflow/Out flow 8 8161299 10297406 7 2

Cash Balance
Brought Forword 0 6006068 14167368 24464774 37087551
Cash Balance 6006068 14167368 24464774 37087551 52243763
Running Finance 0 - 240 - 0 0 0
Cash Carried
Forword 6006068 14167368 24464774 37087551 52243763
 Zarmeen's Collection

Projected Balance Sheet

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 Year 2009 2010 2011 2012 2013 2014
Description
Assets: Zarmeen's Collection
Current
Assets:
Cash 0 6006068 14167368 24464774 37087551 52243763
Security Deposit 1108000 1108000 1108000 1108000 1108000 1108000
Stock and
Inventry((Embriodry
dresses and
Bags, Shoes,
Jewellery) 11609600 3074348 3381783 3719961 4091957 4501153
Prepaid Rent 396000 415800 436590 458420 481340 505407
Account
Receivbles 1767750 2032913 2337849 2688527 3091806 3555577
Net Current
Assets 14881350 12637128 21431589 32439681 45860654 61913900

Fixed Assets:
Furniture and
Fixtue 500000 500000 500000 500000 500000 500000
Machinery And
Equipment 6955000 6955000 6955000 6955000 6955000 6955000
Total 7455000 7455000 7455000 7455000 7455000 7455000
Less: Accumulated
Depriciation
Furniture and
fixture 0 (50000) (100000) (150000) (200000) (250000)
Machinery and
Equipment 0 (1043250) (2086500) (3129750) (4173000) (5216250)
Total
Accumulated
Depriciation 0 (1093250) (2186500) (3279750) (4373000) (5466250)
Net Fixed Assets 7455000 6361750 5268500 4175250 3082000 1988750

Intangible
Assets:
Pre Operational
Expenses 1427320 1427320 1284588 1141856 999124 856392
Less Amortization 0 (142732) (142732) (142732) (142732) (142732)
Total 1427320 1284588 1141856 999124 856392 713660
Suspense
Account 0 8842687 8873431 8907248 8944448 8985368

Total Assets 23763670 29126153 36715376 46521303 58743494 73601678

Liabilities and
Owner Equity:

Liabilities:
Long term Debt 14258202 11406562 8554921 5703281 2851640 0
Short term Debt
Account Payable 0 144270 145713 147170 148642 150128
Total 14258202 11550832 8700634 5850451 3000282 150128

Equity:
Paid Up Capital 9505468 9505468 - 26 -
9505468 9505468 9505468 9505468
Retained Earnings 0 8069854 18509274 31165385 46237744 63946082
Total 9505468 17575322 28014742 40670853 55743212 73451550
 Zarmeen's Collection

Important
Ratios

Year 2009 2010 2011 2012 2013 2014

Current Ratio 87.59 147.08 220.42 308.53 412.41
Debt as %-age of total
captlsn. 60.00% 39.36% 23.39% 12.30% 4.87%
- Gross Margin (%) 57.08% 59.60% 61.92% 64.07% 66.04%
- Operating Margin (%) 43.49% 47.89% 50.56% 53.02% 55.29%
- Net Margin (%) 22.83% 26.84% 29.58% 32.03% 34.21%
Interst Coverage(Times) 5.99 9.07 14.05 24.30 55.76

Calculations
1)Machinery and Equipment
Machinery No Rs/Unit Rs.
Single needle Lock stitch machine 20 300000 6000000
Over Lock Stitch Machine 10 25000 250000
Embriodry Machine 10 25000 250000
Accessories (Scissors, Cutting Board,
Table, Stool, Carpet etc 75000
Total 6575000
Other Equipments
Air Conditioner 2 30000 60000
Stereo System 1 20000 20000
Computer and Printer 5 40000 200000
Telephone 2 5000 10000
Security System( Cameras and television) 3 30000 90000
Total 380000
Total Machinery and Equipment cost 6955000

2)Security Deposit for Stitching house

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 Zarmeen's Collection

Description Months Rent/month Total

Security Deposits for Stitching house 6 18000 108000
Rent payment for Stitching House 12 18000 216000
Rent payment for Shop 12 15000 180000
Rent Payment for Shop and Stitching House(1 Year) 396000
Advance Rent
Advance Rent for Shop 12 15000 180000
Advance Rent for Stitching House 12 18000 216000
Total Advance Rent 396000

3)Human Resource Requirement

Salary
Position Required salary/month Salary Per
Per
Per Worker month Annum
Chief Executive Officer/Owner 2 40000 80000 960000
Designer 5 30000 150000 1800000
Sale Girls 8 7000 56000 672000
Product Supervisor/Cutting Master 5 10000 50000 600000
Stitchers/Tailors 4 10000 40000 480000
Press/Iron Man 5 7000 35000 420000
Finishing Man 2 5000 10000 120000
Office boy 3 7000 21000 252000
Total 34 442000 5304000
Payroll of production Staff 3420000
Payroll Administration staff 1884000

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 Zarmeen's Collection

4)Depriciation Cost
5)Amortization Cost DEPRECIATION COST HAS BEEN CALCULATED ON STRAIGHT
LINE PRINCIPLE APPLYING USUAL RATES AS UNDER;-
Amortization Pre-Operating Expenses 10.00% 1427320 142732
Machinery and Equipment 15.00% 6955000 1043250
Ferniture and Fixture
Tenure 10.00% 500000 10 50000
year
Total 1093250
6)Capital Expenditures

Furniture and Fixture ((interior Decration) 500000

Machinery and Equipment. 6955000
Staff's 1month Salaries. 442000
Promotional Expenses 985320
Total Capital Expenditurs 8882320

7)Long Term Debt Payment

14258202 5 2851640

8)Project Return
Net
Year Operating Depriciation
cash
Profit flow
2009 (23763670) 0 (23763670)
2010 15375768 1093250 16469018
2011 18623690 1093250 19716940
2012 21628950 1093250 22722200
2013 24950971 1093250 26044221
2014 28621767 1093250 29715017

Internal Rate of Return(%age) 77.99%

Payback Period(year) 0.2072

Assumptions

1) production Assumptions
Ladies Gents Total

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 Zarmeen's Collection

Dress Dress
Number of Stitching Machines 20
Production Capacity (No. of dresses per month) 800 600 1400
Production Capacity (No. of dresses per year) 9600 7200 16800
Capacity Utilization for the first year
(No. of dresses per month) 300 400 700
Capacity Utilization for the first year
(No. of dresses per Year) 3600 4800 8400
100.00
Self Production (% of total production) %
Installed Capacity 50.00%

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 Zarmeen's Collection

2) Cost
Assumption
s
Embroided Dresses
Average unit cost per dress (Rs.)
Fixed cost
Machine Maintenance Cost 5
Admin & Rent expenses & promotional expenses 300
Fixed electricity 30
Average Fixed Cosr Per Dress(Rs) 335

Ladies Dresses

Average
Variable Cost
Material & Fabrics 669
Accessories 160
Embroidery Cost 358
Direct Labor Cost 250
Direct Electricity Cost 23
Average Variable cost per Ladies dress (Rs.) 1461
Average Total Cost Per Ladies Dress 1796

Gents Dresses
Variable Cost
Material & Fabrics 500
Accessories 22
Embroidery Cost 97
Direct Labor Cost 250
Direct Electricity Cost 22
Average variable cost per gents Dress 891
Total cost per Gents Dress 1226

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 Zarmeen's Collection

Raw Embriodry Direct

Material and Electri- Maintain-
ence
Cost Accessory city Cost Cost
Cost
Ladies Dresses 2409000 1866000 84000 18000
Gents Dresses 2400000 569600 105600 24000
Total 4809000 2435600 189600 42000

Raw Material And Accessories

cost 7244600

Ladies Bags(Annual purchase)

Cost Per units Rs.
Unit
Casual Bags 550 800 440000
Fancy Bags 700 500 350000
Total Cost on Bags 1300 790000
Stock in Hand (1Year) 10% 900 130 117000

Shoes(Annual purchase)
Purchase units Rs.
Price/Unit
Ladies Shoes 850 1500 1275000
Gents Shoes 1500 1000 1500000
Total Cost on Shoes 2500 2775000
Stock in Hand (1Year) 10% 1600 250 400000

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Jewellery(Annual purchase)
Purchase Items Rs.
Price/Items
Casual Jewelry 400 1000 400000
Formal Jewelary 500 800 400000
Total Cost on Jewellery 1800 800000
Stock in Hand (1Year) 10% 650 180 117000

Total Cost on Bags, Shoes, Jewellery 4365000

Total Stock in Hand (Bags, Shoes,
Jewellery) 634000

Increase in cost of (Bags, Shoes, Jewellery) 0.025

3)Salea assumptions Embroided Dresses

Laddies Dresses
No. of dresses sold per month(Year 1) 500
Average unit price per dress (Rs.) 3283
Average Monthly Sales through retail outlet (Rs.) 1641667
Gents Dresses
No. of dresses sold per month(Year 1) 300
Average unit price per dress (Rs.) 1933
Average Monthly Sales through retail outlet (Rs.) 580000
Net Sale per month (1 Year) 2221667

Net Units Produced per Year (Units) 1year 8400

Ending stock (1 Year) %age of units Produced 672
Net Units Sold per year 7728
Average Price per ress 4250
Net Sale per Year (Rs) 1year 32844000

Closing Stock 2856000

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 Zarmeen's Collection

Ladies Bags(Annual Sale)

Sale units Rs.
Price/Unit
Casual Bags 150 720 108000
Fancy Bags 200 450 90000
Net Sale of
Bags 1170! 198000

Shoes(Annual Sale)
sale units Rs.
Price/Unit
Ladies Shoes 700 1350 945000
Gents Shoes 1000 900 900000
Net Sale of
Shoes 2250 1845000

Jewellery(Annual Sale)
Sale Items Rs.
Price/Items
Casual Jewellery 200 900 180000
Formal Jewellery 400 720 288000
Net Sale of Jewellelry 1620 468000

Net sale of Bags,Shoes,

jewellery (1 Year) 2511000

Net sale of Boteque 35355000

Sale growth rate (Units) 10.00%

Sale growth rate (price) 3.00%

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4)
Operating
total
Assumption
s

Hours operational per day 8

Days operational per month
25
(Production)
Days operational per month (Boutique) 25

6) Expense Assumptions
Initial Promotional Expenses (Year 1) 3.00%
(%age of expected sales)
Promotion Expenses after Year 1 1.50%
(% of expected sales)
Machine Maintenance per annum Rs. 25000
Direct Electricity per month (Year 1) 10000
Fixed Electricity per month (Year 1) 12000
Telephone and Internet charges per month (Year 1) 7000
Raw Material Price Growth rate 1.00%
Payroll growth rate 10.00%
Machine Maintenance growth rate 10.00%
Direct electricity growth rate 10.00%
Fixed electricity growth rate 10.00%
Rent growth rate 5.00%
Telephone and Internet charges growth rate 5.00%
Straight
Depreciation Method Line
Account Recivable(%age of sales) 2.00%
Account Payable (%age of Raw Material and Accessories 3.00%

7) Financial Assumption
Project Life 15 year
Debt: Equity Ratio 0
Interest Rate on Long Term
18.00%
Debt
Interest Rate on Short Term
18.00%
Debt

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Debt Tenure 5year

Debt Payment per year 100.00%
Discount Rate 18.00%

Tax Rate 37.00%

5) Cash
flow
total
Assumption
s

Account Payable Cycle (Days) 10

Account Receivable Cycle
10
(Days)
Raw Material Inventory
15
(Days)

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