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Preface

It is said that Knowledge is power but applied knowledge


is power seems to be the correct statement.

We are in the professional field of management and


practical study is a part of our curriculum.

Practical knowledge is very important in todays business


world. Theoretical knowledge is also important as it gives the
knowledge of using the theory in practical world.

Saurashtra University has decided to take steps in the


progress by making compulsory preparation of product report.

I have chosen the product Potato Wafers which is the part


of food industry.
Acknowledgement
I am heartily thankful to the Saurashtra University, which
has given me the golden opportunity to prepare the product project
report of potato wafers.

I am also thankful to honorable principal Mr. T.T.RAIYANI who


has leaded me to enlighten my self in preparation of this project.

I am heartily thankful to Management Faculty without whose


constant guidance this work would have been an impossible task to
complete. His inspiration and encouragement has leaded me to come
with a successful task.
Declaration
I, the under sign AGHERA ANKUR N. here by declare that
the project work submitted in this report is my own contribution
and is carried out under the supervision as A MANAGEMENT
FACULTY OF R.P.BHALODIYA College of Commerce &
B.B.A. - RAJKOT.

Date:
Place:

____________________
AGHERA ANKUR N.

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Index
Sr.No. Particulars

1 Project at glance
2 Promoters Background
3 Location of the unit
4 Organization Structure
5 Form of Organization
6 Introduction of Product
7 Production Process
8 Production Capacity
9 Raw materials and Suppliers
10 Market analysis
11 Financial Details
12 Future Prospectus
13 Risk Factors
14 Bibliography
Project at Glance

Name of unit RADHE INDUSTRIES


Communication Address 3/8 Mani nagar, Rajkot- 360 004
Form of organization Partnership Firm, Register Under,
Partnership Act, 1932
Partners 1. Aghera Ankur
2. Anchal Bhattacharya
Brand of the Product Bansi Wafers
S.S.I. Registration No. Application has been Made
Subsidy Registration No. Application has been Made
Type of Industry Food Industries
Type of Organization Partnership
Budget cost of Product 35,00,000
Means of Finance Owned Capital and Loan from GSFC
Bank Rajkot.
No. of Employees 16
Plant Installed Capacity 100 %
PARTNERS BACKGROUND
Partners Background

Partner I

Name : Aghera Ankur N.


Age : 20 Years.
Education : B.B.A. with Advance, Marketing
Management.
Financial Contribution : 15,00,000
Duties and Responsibilities : Marketing and Production Department.

Partner II

Name : Anchal Bhattacharya.


Age : 25 Years.
Education : M.B.A. with Financial Management.
Address : Vraj Vihar Murlidhar Society 1,

Rajkot 360003
Financial Contribution : 8,00,000
Duties and Responsibilities : Personnel and Financial Department.
Partner III

Name : Manish Bhaya


Age : 29 Years.
Education : M.B.A. with Personnel Management.
Address : Babul Amruta Society 13,

Rajkot 360006
Financial Contribution : 5,00,000
Duties and Responsibilities : Personnel and Financial Department.

LOCATION OF INDUSTRY
When a business unit is expanding or when a new industry is to
be established the main decision to be taken about location of the
industry. Location of the plant is a vital factor deciding the profitability
of company. There are many factors, which are to be kept in mind while
selecting the location of the plant. It includes both internal and external
factors. Even it promoters have best ability to invest and have the
effective managerial skills but if they dont take care of location, it will
decline prosperity of the company.

RADHE INDUSTRIES is situated at: 3/8 Mani nagar,


Rajkot- 360 004

Some benefits enjoyed by the firm because of its proper location


are as under: -

ENVIRONMENT: -

The un-hygienic climate of any place could not be favorable to


any type of firm. RADHE INDUSTRIES is located in open land, which
has pleasant and silent environment.

RAW MATERIALS: -

Raw Materials form the nerves of any company. Expense related


to purchase and sale of raw material plays an important role in deciding
the price of a product.
LABOUR: -

Man Works and Thus the Company Works. Labor is one of the
essential parts of the industry. As RADHE INDUSTRIES is situated in
RAJKOT so they get the workers easily for labor.

OTHER FACILITIES: -

Electricity is available to them easily. Firm has 60 H.P. But then


also if they have any power problem, they have generator. Moreover,
they get subsidies from G.I.D.C. RADHE INDUSTRIES has water
facility.

Thus the firm has decided the location keeping most of the
positive points in their mind and thus RAJKOT proves to be the best
location for the industry.
ORGANISATION STRUCTURE

Organization is a group of people working together to achieve


some specific goals and objective with authority flowing from top level
to bottom level and responsibility from bottom level to top level.
Organization can also be defined as identifying and grouping work to
perform.

An author had said that one plus one makes an organization


structure. Depending upon different types of covers to product and
manufacturing process the organization structure is decided.

RADHE INDUSTRIES has divided its structure in main category.

AGHERA ANKUR is the top-level authority.

Thus the organizational structure is very simple and good even if


this is a small scale firm each and every individual knows there own
responsibility. So we find a lot of Co-ordination in this firm.
ORGANIZATION CHART

AGHERA ANKUR

GENERAL MANAGER

OFFICE ASSISTANT

PRODUCTION INCHARGE

WORKERS
SIZE AND FORM OF
ORGANISATION

According to companys law 1956, a company is classified into


three broad categories like.

Small Scale

Medium Scale

Large Scale

Industries with investment more then 75 lakhs are included under


the Small Scale. So RADHE INDUSTRIES is the small-scale industry.
It is equipped with latest machineries.

As mentioned in the companys laws there are five types of


organizations. Which are as follows,

Types of Organisation

Sole Partnership Public Private Co-operative


proprietorship firm Sector Sector Organisation
firm

ADHE INDUSTRIES is said to sole partnership firm in


which all the profit or loss, all belongs to the owner. He is responsible
for any situation occurs in the business.
INTRODUCTION OF PRODUCT
The firm has been engaged in the production of delicious
nourishing food product, which has acclaimed warm response of
people in the Rajkot. The firms products like potato wafers, banana
wafers and other salted products are prepared in its fully automatic
plant with bacteria free and stringent hygienic standards. The use of
computer system ensures uniform quality and obviates the necessity
for touch of human hands.
Production Process
The product can be made step by step. The same thing is
happen here and following is process of potato wafers.
TO TAKE POTATOES IN MACHINE

WASHING

PEELING

SLICING

WASHING

TO TAKE STEAM

FRYING

ADDING SPICES

FINISHED POTATOES CHIPS


PORDUCTION CAPACITY
In order to meet the increasing demand of the product, the
company has planned to install a sophisticated and ultra-modern
computerized plant with product capacity of 1000-1200 kg per hour on
land measuring 25000 to 30000 meters in the RAJKOT

RAW MATERIAL

Raw Material is basic requirement of any factors or an industry. It


acts as a fuel, which is required to run the vehicle of production. Raw
material is an inseparable organ of production unit.

RADHE INDUSTRIES purchase raw material from the local


market or sometimes in the time of price rise in raw material, they buy
from outside the GUJARAT means from all over in India.

For RADHE INDUSTRIES, most of the items of raw materials


are the part of agricultural production so it has dealt with farmers and
agricultural agents. The firm has a good relation with the different states
wholesale agents that are in UTTAR PRADESH, PUNJAB,
HARIYANA etc. so firm never feel shortage of raw materials.
Market potential
The consumption of wafers has been increasing over the years.
The survey relating to the foods and snacks demand in GUJARAT
region indicates that rural and semi urban areas of GUJARAT have a
wide demand of snacks.

Some of the findings of this survey are as under.

17% people blaming proper distribution channel for faulty


supply.

15% people blaming wrong packaging.

37% peoples opinion is that there is short supply.


Financial Details

1. LAND
NO. PARTICULARS SQURE RATE/ AMOUNT
METER SQ. M.
1. Open land 400 500 2,00,000
2. Registration - - 79,000
Total 2,79,000

2. BUILDINGS
NO. PARTICULARS AREA RATE/ AMOUNT
SQ. M.
1. Factory Shed 300 1,000 30,000
2. Office 50 1,200 60,000
3. Other (R&D, 50 1,350 67,500
bathroom, Water
tank, Designing
etc.
Total - - 4,27,500

3. PLANT & MACHINERY


NO. PARTICULARS AREA RATE/ SQ. AMOUNT
M.
1. Potato washing 01 2,25,000 2,25,000
machine
2. Potato slicing 50 1,200 60,000
machine
3. Other (R&D, 50 1,350 67,500
Water tank,
Designing etc.
Total - - 3,52,500

4. Furniture & Vehicle


NO. PARTICULARS AMOUNT
1. Office furniture 2,27,000
2. Vehicles 7,65,000
Total 9,92,000

WORKING CAPITAL COST OF PROJECT

NO. PARTICULARS AMOUNT


1. Value of raw materials 7,39,200
2. Wage & salary 1,03,500
3. Electricity bills 14,400
4. Overhead expenses 5,700
Total working capital(1 year) 8,62,800
Total working capital (1 month) 71,900

TOTAL COST OF PROJECT

NO. PARTICULARS AMOUNT


1. Fixed assets 16,15,500
2. Working capital( 2 months) 1,43,800
Total cost of project 17,59,300

5. FINANCIAL PROVISIONS
LOAN

No. PARTICUL G.S.F.C. OWN BANK TOTAL


ARS AMOUN
T RS.
1. Land 1,30,000 1,00,000 - 2,30,000
2. Building 2,00,000 77,500 1,50,000 4,27,500
3. Plant & 3,00,000 2,66,000 - 5,66,000
machinery
4. Furniture - 92,000 3,00,000 3,92,000
& vehicle
5. Working - 43,800 1,00,000 1,43,800
capital
Total 6,30,000 5,79,300 5,50,000 17,59,300

MEANS OF FINANCE

NO. PARTICULARS AMOUNT


1. G.S.F.C. 6,30,000
2. Own contribution 5,79,300
3. Bank 5,50,000
Total 17,59,300

RAW MATTERIAL

No. PARTICULARS REQUI RATE MONT YEARLY


REMEN HLY RS.
T
1. Potato 28,000 1.10 30,800 3,69,600
2. Spices 28,000 1.1 30,800 3,69,600
Total 56,000 - 61,600 7,39,200
LABOUR CHARGES

NO. PARTICULARS NUMBER MONTHLY YEARLY


S RS. RS.
1. Skilled labor 01 2,500 30,000
2. Semi-skilled 01 2,000 24,000
labors
3. Unskilled labor 02 1,500 36,000
Total 04 - 90,000
Add : 15% other - - 13,500
benefit
Total labor - - 1,03,500
charges

ELECTRICITY BILL

NO. PARTICULARS MONTHLY RS. YEARLY RS.


1. Electricity bills 1,200 14,400

REPAIRS & MAINTENANCE

NO. PARTICULARS YEARLY RS.


1. Repairs & maintenance 13,000

INSURANCE & TAXES


NO. PARTICULARS YEARLY RS.
1. Insurance & taxes 12,000
DEPRICIATION

NO. PARTICULARS RATE OF YEARLY RS.


DEPRICIATION
1. Building 5% 21,375
2. Machinery 15% 84,900
3. Furniture 10% 39,200
Total depreciation - 1,45,475
INTEREST

NO. PARTICULARS PRINCIPLE YEARLY


AMOUNT RS. INTREST
1. G.S.F.C. 6,30,000 1,00,800
2. Own contribution 5,79,300 86,895
(15%)
3. Bank (18%) 5,50,000 99,000
Total interest - 2,86,695

ADMINISTRATIVE EXPENSES

NO. PARTICULARS MONTHLY RS. YEARLY RS.


1. Stationery 500 6,000
2. Postage & 1,200 14,400
telephone
Total amount 1,700 20,400

TOTAL COST OF PRODUCTION

NO. PARTICULARS YEARLY RS.


1. Raw materials 7,39,200
2. Labor charges 1,03,500
3. Electricity bills 14,400
4. Repairs & maintenance 13,000
5. Insurance & taxes 12,000
6. Depreciation 1,45,475
7. Interest 2,86,695
8. Administrative expenses 5,700
Total cost of productions 13,40,370
Break even Analysis
Break-even analysis is a scientific analysis, which leads producers
towards more systematic and scientific production planning or sales
planning. It is because of break-even analysis that the firm can
accordingly work out the required size of the plant. By break even
analysis the small-scale entrepreneur can get proper guidelines about
volume of sales to be achieved to avoid the danger of loss.

Break-even analysis indicates a point where total revenues are


equal total cost. It means a volume of sales where firm earns neither
profit nor suffer loss in called Break-even point.
Calculation of break even
point

PARTICULARS AMOUNT AMOUNT


Sales 18,83,280

Less: Variable cost


Raw materials 7,39,200
Labour charges 1,03,500
Administrative expenses 20,400
Electricity bills 14,400
Overhead expenses 5,700 8,83,200

CONTRIBUTION 10,00,080
Less: Fixed costs
Interest
Depreciation
2,86,695
Insurance & taxes
1,45,475
Repairs & maintenance 12,000
13,000 4,57,170
PROFIT BEFORE TAX
Less: Income tax @ 35% 5,42,910
1,90,019
NET PROFIT
3,52,891
Break even point (%)

Fixed costs
= X 100
Contribution

457170
= X 100
1000080

= B.E.P. (%) = 45.71%

Break even point (Rs.)

Fixed costs
= X Sales
Contribution

457170
= X 1883280
1000080

= B.E.P. (Rs.) = 860910

Profit volume ratio

Contribution
= X 100
Sales

1000080
= X 100
1883280
= P.V.R.= 53.10%

Net profit ratio

Net Profit
= X 100
Sales

352891
= X 100
1883280

= N.P.R.= 18.74%
SUPPLIERS OF MACHINERY
Address of Machineries and its suppliers
Backbone Industries
27/B Ghatkopar (EAST)
Mumbai
Noble Engineering Pvt. Ltd.
Ram Nagar Industrial Park,
Lucknow ( U.P.)
Makson Pvt. Ltd.
3RD Floor, Mahalaxmi Complex
Parle Point
New Delhi
FUTURE PROSPECTUS
Future prospectus
Every unit has its own dream and plan. Continuous planning in
specific direction for expanding activities is quit essential thinking of
future planes and as each and every individual, even every company is
ambitious.

RADHE INDUSTRIES is working well and there is wide scope


of growth in this line because this is the only industry where constant
demand and more profits are also available.

The company is also planning to introduce his new innovation


that is PINEAPPLE WAFERS and this is only product which the firm
has monopoly.
BIBLIOGRAPHY
BIBLIOGRAPHY

PERSONS

Hardiksinh Jadeja who helped me in publishing of my


report.

Harshvardhan Parekh of Royal Printing Press who is my


close friend helped during my project.

BOOKS

Modern Business Organization By Sherlaker & Sherlaker

Production Management Chunawala and Patel