TEAM – A8

Nimesh Gujar - 24
Rohan Karanth - 32
Abhay Nandan - 48
Sudeep Pradhan - 60
Gautam Tewari - 81
Vrushabh Yekhande - 91

AN
INTERNATIONAL
BUSINESS PLAN
 Table of Contents
Sr No. Topic Pg. No.
1 Executive Summary 2
2 Business History 3
3 Market Research 5
4 Marketing decisions 11
5 Legal decisions 15
6 Manufacturing and operations 17
7 Personnel strategies 18
8 Financial decisions 21
9 Implementation schedule 26

1
 AN INTERNATIONAL BUSINESS PLAN
A detailed international business plan is an essential element in the implementation of an
effective export strategy. The plan must consider company resources, identify specific
markets, and establish specific plans for dealing with marketing, legal, manufacturing,
personnel, and financial elements. Finally, it must include a schedule for implementing
the plan.

I. Executive summary
Pure Organic Pvt. Ltd. was established in September 2018 by the management graduates
of Welingkar Institute of Management. The company specializes in customized organic
fertilizers at a competitive rate and it has its factory and warehouse at Sangli,
Maharashtra. The Head office located at CBD, Navi Mumbai. We want to establish our
footprints in Vietnam which will be our primary market, Indonesia, Thailand are our
secondary and tertiary markets respectively.

There are two important processes for the manufacturing of our product premium organic
manure pellet.
1. Manufacturing pellets using pellet machines
2. Enzymatic process to boost the quality of the product

We are planning to export 30 containers of 24MT each to Vietnam in the first year. In the
second year we wish to expand to Indonesia and Thailand.
In the first year our strategy is to ship low value and high-volume consignments to
Vietnam in order to reduce capital risks and understand the local market conditions. Our
key responsibility is to drop the shipment at the port in Vietnam from there the client’s
agents will be responsible for clearance and logistics.
We will be appointing marketing agents who will be generating leads by connecting with
B2B Local players in Vietnam. The whole process of manufacturing of goods and
delivery at the Vietnam port takes around 26 days. We will be relying on Telegraphic
Transfer/Documents against payments.

We have projected revenue of first year to be around Rs 1.36 Cr. In the first year we will
be incurring loss of 13.75 Lakhs due to investment in machine.

2
II. Business history
A. History of company
Pure Organic Pvt. Ltd. was established in 2018 as a SME, manufacturing & Marketing of
Plant Growth Promoters & Bio organic Fertilizers. Pure Organic Pvt. Ltd. is a Partnership
Company started by six technocrats Rohan Karanth, Nimesh Gujar, Sudeep Pradhan,
Gautam Tewari, Vrushabh Yekhande and Abhay Nandan to manufacture & market
various innovative specialty organic fertilizer for soil conditioning & growth promoters
for foliar spray.

B. Products-services offered and their unique advantages

• Premium Organics Manure Pallets (100% Composted and enzyme treated):
Increasing the fertility of soil basic organic MPK to the plant it better than
composed fertilizer since it is enzyme treated. Resulting into millions of microbes
in the soil helping the plant to uptake the nutrients from the soil.
• Biosil (Bio silica + bio zinc):
Required by the plant for the healthy growth healthily & high yield increase of
produce. It is given in trenching at the root level or by foliar spray. It is highly use
full for rice, wheat and vegetables. Zinc is very essential micro nutrient which
increases the immunity of the plant.
• Lower value foliar spray (made from animal protein):
It provides special animal proteins to the plants and enzymes which will help in
increasing the yield as well as increasing the produce of the crop.

Enriched Bio organic fertilizers like Humi Green Granules, Bio Bloom Powder & Humi
Bloom Granules for increasing the fertility of soil & for reducing the usage of chemicals
fertilizers have made a commendable impact in Agricultural fields. Combination of Bio
Stimulant & Growth Promoters induced the crop to grow healthily & high yield
increase of produce to the tune of 35 to 45%.

C. Domestic-market experience
NMCBI & RCI Memberships. Life member of Agro Inputs Manufacturer's Association
Pune. Bio organic fertilizers like Humi Green Granules, Bio Bloom Powder & Humi
Bloom Granules for increasing the fertility of soil & for reducing the usage of chemicals
fertilizers have made a commendable impact in Agricultural fields in Karnataka & Orissa.
One of the Corporate got the state award & mother Teressa award for offering best
organic Fertilizers under Pure Organic Pvt Ltd.’s Brand.

D. Foreign-market experience
Pure Organic Pvt Ltd. is associated with corporate from different states & exclusively
supplies & develops innovative organic growth Promoters & soil conditioners to these
Organizations.

3
E. Production facilities
Well set compact factory area.
• Equipped with modern Machineries & reactors.
• Separate packing area.
• Assisting laboratory with latest Analytical equipment’s.

F. Personnel-international experience and expertise

Pure Organic Pvt. Ltd. has pooled in technocrats from different faculties like chemical
engineering, entomology, pharmacy & organic chemistry & developed various innovative
growth Promoters & Bio Stimulants for crops. All these products were manufactured
under Pure Organic Pvt. Ltd.’s Brand. Currently CEO of the co is looking after exports
with the help of executives of manufacturing of the quality product and the clearing agent.

Broadly our team consists of-

• Technically trained personals
• A group & group of Companies run by technocrats under Pure Organic Pvt. Ltd.
brand.
• Chartered Accountant & Administrative
• Research Chemists & Consultants

G. Industry structure, competition

Industry: Organic Fertilizer and plant growth promoters.
Some of the leading players in Vietnam organic fertilizers market include:
• Baconco Vietnam
• Binh Dien Fertilizer Joint Stock Company
• Bioway-Organic 5c
• Shanghai Megchem Company Ltd.
• Can Tho Fertilizer & Chemical JSC
• ANH Viet Co. Ltd.

4
III. Market Research
A. Target countries & Market conditions in target countries

1. Primary (Vietnam)
1. Existing demand

The Vietnam organic fertilizers market valued at USD 930.54 million in 2017 is expected
to reach USD 1.560 billion by 2022 (In Fig. 1,1), at a CAGR of 11%. Microbe-based
biofertilizers, with its versatile approach towards plant productivity, accounts for the
majority market share in the country.

The organic fertilizer industry has recently expanded. It is estimated to have increased at
an impressive 11% compound annual growth rate from 2016 to 2021. The country
annually produces >1.2 million tons of organic fertilizers.
Fig. 1.1

2. Competition

Some of the leading players in Vietnam organic fertilizers market include:

• Baconco Vietnam
• Binh Dien Fertilizer Joint Stock Company
• Bioway-Organic 5c
• Shanghai Megchem Company Ltd
• Can Tho Fertilizer & Chemical JSC
• ANH Viet Co. Ltd.

Apart from these competitors we have competition from China (38%) and Japan. They
are already supplying to Vietnam in bulk quantities hence, we had to develop premium
quality to enter the market. This premium quality was about incorporating enzyme
treatment.

5
3. Strengths and weaknesses of the economy-barriers to entry, etc.

Strengths
Composting is considered a proper approach to the rising amount of organic waste from
municipal solid waste, sewage sludge, and agricultural by-products in developing
countries.

In Vietnam, composting the wastes have recently begun. Adding chemical fertilizers to
the waste during composting is a common practice. There is a lack of empirical evidence
for the effectiveness of this practice. The application of compost is recommended not
only for improving soil productivity, but also for reducing eutrophication because of
excessive application of chemical fertilizers.

Weaknesses
One of the most striking problems for Vietnam is widespread soil degradation in
agricultural areas, requiring the use of the land in a more sustainable manner. Nguyen et
al. reported that improved land tenure security is associated with a higher level of manure
use by farm households. Sustainability certification has become increasingly popular in
recent years, even though the excessive application of fertilizers and irrigation have made
it difficult for farmers to conform to most certification standards and programs.

Various fertilizers labeled as “organic fertilizer” are being sold in the markets; however,
criteria of their raw materials and production have not been established. Quality of these
fertilizers requires clarification.

One of the major challenges for us in the order execution process is the long custom
clearance and various time-consuming checking points. Also, non- availability of LC
immediately from their (importing country) banks is the key challenge which often leads
to the delay in sending the advance by T.T. (telegraph transfer).

2. Secondary:

Indonesia Imports of Fertilizers

Indonesia Imports of Fertilizers was US$2.23 Billion during 2017, according to the
United Nations COMTRADE database on international trade.

Market Insights
Fertilizers are one of the major inputs, which help in increasing the yields of the crops.
Fertilizers consumption rate in Indonesia has been increased over the last decade.
Growing population and limited agricultural land have accelerated the demand for
agricultural land and proper utilization of fertilizers, to increase crop yields. In 2016, the
Indonesian fertilizers market was valued at USD 2100.30.

6
Market Dynamics

The Indonesian fertilizers industry is one of the largest agrochemicals sector in Indonesia
and is growing at a faster pace. Increased number of subsidies is one of the major factors
driving the fertilizers industry.
Dual pricing system of fertilizers is one of the major restraints to the fertilizers market. A
large number of companies are exporting and selling subsidized fertilizers at higher
prices, along with high-production cost are other factors restraining the fertilizers market.

Market Segmentation

The Indonesian fertilizers market is segmented on the basis of product type and
application.
By product type, the market has been segmented into nitrogen, phosphorus, potassium,
micronutrient fertilizers, and others. The nitrogen fertilizers segment accounts for the
largest market share, with the urea sub-segment holding the maximum share.
By application, the crop-based fertilizers segment holds the largest market share, with
grains & cereals sub-segment occupying the major market share. Fertilizers are majorly
used on rice crops and fertilizers; moreover, the use on rice crop occupies the major
market share.

Major Companies in the Sector Include:

• Yara International
• PT Pupuk Sriwijaya
• Stefes GMBH
• Indorama Corporation

Organic Fertilizer is still in the start stage, so total production quantity of organic
fertilizer is low in Indonesia. Plenty of agricultural residues are not fully utilized and well
managed. The main reason is that most farmers are smallholders of the field. Besides that,
organic fertilizers are needed in the same acre lands, compared with chemical fertilizer.

Production of organic fertilizer

Production of organic fertilizer is very limited in Indonesia. However, Indonesia

Government is increasing its subsidy in organic fertilizer, such as in Bali. The Bali
administration is determined to continue transforming the island into an “organic”
province, where local farmers embrace healthier and greener organic farming. Bali
Governor Made Mangku Pastika declared his administration would increase the subsidy
provided for organic fertilizer to encourage local farmers to make the transition from
chemical to organic fertilizer. Another key strategy is phasing out the chemical fertilizer
subsidy while increasing the organic fertilizer subsidy. The administration completely
stopped subsidizing chemical fertilizer in 2012, forcing farmers to pay a higher price for
chemical fertilizer.

7
3. Tertiary: Thailand
Thailand Imports of Fertilizers
Thailand Imports of Fertilizers was US$1.72 Billion during 2017, according to the United
Nations COMTRADE database on international trade.

According to the latest research report released by Technavio, the fertilizers market in
Thailand is expected to reach close to 3.36 million metric tons in terms of consumption
by 2019.

Agriculture is one of the major sources of revenue in Thailand with more than 60% of the
country’s population involved in the sector. Increase in the country’s population has
created a rising demand for food supplies, and has thus highlighted the need for improved
agriculture production and capacity building in the region. These concerns impel
consumption of fertilizers and therefore expected to help the market grow over the next
four years.

Some of the other driving forces behind the growth of the fertilizer market in Thailand
are as follows:
• Rise in fertilizer imports
• Increase in adoption of biofertilizers
• Growing adoption of soil fertility management practices

8
Rise in fertilizer imports

Imports of fertilizers have a major influence on the fertilizer industry in Thailand. With
the increase in demand for fertilizer, the country is not able to supply sufficient chemical
fertilizers, due to which, it is mainly dependent on imports. According to estimates, about
2.5 million tons of nutrients (nitrogen fertilizers, phosphate fertilizers, and potash
fertilizers) were imported in 2012.
Costs involved in setting up new fertilizer plants, coupled with a growing demand for raw
materials needed to manufacture fertilizers has forced the fertilizer industry in Thailand
to be dependent on imports.

Increase in adoption of biofertilizers

Increased awareness of the negative impact of chemical fertilizers on health and

environment has led to the adoption of eco-friendly biofertilizers. Such biofertilizers are
organic in nature and are commonly derived from seaweed and fish and bone meal.
Seaweed supplies potassium and other trace elements, while fish meal is a good source of
nitrogen and phosphorous. Such organic nutrients are usually composted before they are
applied to plants. However, their efficacy is low when compared to chemical fertilizer.
Their increasing adoption can also be attributed to the growing demand for organic food
and the increase in government regulations for environmental safety

Growing adoption of soil fertility management practices

Over the years, soil fertility management practices have gained significant importance in
the Thai market. This trend is primarily attributed to the loss of arable land and an
increase in the demand for food mandate crop yield efficiency.
Soil fertility management involve the following practices:
• Conservation tillage: Planned tillage of soil so that crop residues are not entirely lost.
This practice helps conserve the soil surface, thus reducing soil erosion.
• Crop rotation: Alternate production of crops that belong to different crop families on
the same land.
• Optimum use of fertilizers.

Farmers in Thailand are continuously adopting soil management practices to improve the
quality and quantity of agricultural production. Hence, such soil fertility management
practices are necessitating the use of fertilizers and increasing its demand. Currently, soil
fertility management practices are being implemented on crops like rice, soybean, maize,
barley, and sugarcane, and this trend will continue to augment the demand for fertilizers
in Thailand during the forecast period.

Competitive landscape and key vendors

The fertilizers market in Thailand is extremely competitive, with players competing to

enhance market share. Factors such as intense competition, rapid advances in technology,
and frequent changes in consumer preferences create significant risks for market vendors.
Therefore, the market is expected to witness increased consolidation because of the
growing competition among vendors.
9
Top vendors in this market are -
• Artemis & Angel
• Chia Tai
• National Chemical Fertilizer Public Company
• Thai Central Chemical
• Yara International

10
IV. Marketing decisions
Marketing decisions
Export Mode: Pure Organic Pvt. Ltd will export directly to the client countries. The
inventory for the export will be sourced from Sangli on the basis of demand as we have a
warehouse their too, we would be storing it there until the documentation and other
criteria are fulfilled for the export. Just in Time delivery of the consignment at the port
will be our differentiator.
Localization/adaptation: Pure Organic Pvt. Ltd will be packaging organic fertilizers in
25 kg sacks. Pure Organic Pvt. Ltd will initially use Vietnamese language on packaging
and brochures.

Advertising & promotion: Pure Organic Pvt. Ltd has a export marketing manager cum
agents focusing on Vietnam. They would be responsible for increasing the business in
that area and our agents will partner with other local agents to generate leads and convert
sales.
Some of the marketing strategies for getting the prospective customers are:
I. Find the directory of importers of the target country and connect with them.
Example of which is shown below:-

11
II. Writing to the Embassy of India in the target country for assistance and export
orders

III. Writing to the chamber of commerce of target country

IV. Participating in a Fair/Exhibition abroad either directly or through the

Export

V. Listing in various trade portals and having our official

website.

12
 VI. Through the personal contacts in that country like-

By these processes we can have the list of customers. We have to interact or correspond
with these customers by sending samples, getting feedback from the customers etc. to
ultimately select the customer with whom to deal with.
Documentation
Following documents will be submitted at the customs of JNPT-
• Bank AD code
• Company's balance sheet (Registration authority in JNPT)
• GST certificate
• SSI registration
• IEC code
• Partnership agreement

13
Documents required for Import (Vietnam)
• Bill of lading;
• Cargo release order;
• Commercial invoice;
• Customs import declaration form;
• Inspection report;
• Packing list;
• Technical standard/health certificate; and.
• Terminal handling receipts.

Documents Required for Import (Thailand)

• Import Declaration
• Bill of Lading (B/L) or Air Waybill
• Invoice
• Packing List
• Import License (if applicable)
• Certificates of Origin (if applicable)
• Other relevant documents such as catalogue, product ingredients, etc.

Documents Required for Import (Indonesia)

• At a minimum, the exporter or their agent must provide a
• Pro-forma invoice,
• Commercial invoice,
• Certificate of origin,
• Bill of lading,
• Packing list,
• Insurance certificate.

Pricing strategy
We are only responsible for delivering the finished product till the port in Vietnam, all
costs till this point are borne by us.
We want to sell at low Rate and large volumes, to compete with Chinese alternatives, at
the same time focus on increasing quality. We are shipping multiple containers of low
value and high volumes, in order to gain profit, we have to ensure economies of scale is
achieved.

14
 V. Legal decisions
A. Agent/distributor agreements
Since we have an importer who will handle- branding and distribution of our product (the
product is packaged in Indian & then shipped) there is no specific agreement between us
and the agent/distributor.

Our criteria to select the importer is as per three of the most important parameters-
1) the rate negotiations proceedings.
2) checking the authenticity of the company.
3) approval of the sample.

B. Patent, trademark, copyright protection

Our organization does not own any patent but our core competency is ability to carry
research of innovative products, successful field trials and up to date interaction and
communications.

C. Export/import regulations
In order to carry our export business operations, we need to fulfill following
export/import requirements
• IAC code and registration at customs
• Bakers AD code registration

D. ISO 9000
This certification is not required for the product that we are currently going to export to
the importing countries.

E. Dispute resolution
Pure Organic Ltd would be having most of its export transactions In first year as 25%
advance & 75% after Receipt of Scanned Copy of Documents to the Importer. From
second year of operations we would have our export transactions carried out through LC
at Sight.
An LC at sight is a letter of credit (LC) that is payable immediately – within five to ten
days – after the seller meets the requirements of the letter of credit. A letter of credit is a
document from a bank that guarantees payment. While there are several types of letters of
credit, they are often used when buying and selling: if a buyer fails to pay a seller, the
bank that issues a letter of credit will pay the seller (assuming all requirements are met).
There could be rise of a dispute If the importer feels that some requirement is not met
which according to us has been fulfilled.
Since we have limited resources we would prefer not to go for a litigation or arbitration
for dispute resolution as it would prove to be a costly affair for the company.
Through mediation we can voluntarily reach on an agreement & the dispute can be
resolved.

15
Ways we can have mediation:

Non-governmental mediation refers to mediation activities hosted by non-governmental

organizations or natural persons together with the people’s mediation, industrial
mediation and different unofficial mediation, like professional person mediation,
neighborhood mediation so on. The non-governmental mediation organizations in
conflicts have created nice progress in recent years.

Mediation via mediation establishments: - presently there's no specific law concerning

mediation through mediation institutions, and also the mediation establishments
themselves create their own rules.

Any industrial dispute will be submitted to mediation via mediation establishments. The
fees of this establishments vary between 2-5% of arbitration quantity.

16
VI. Manufacturing and operations

A. Location of production facilities for exports

Local interstate manures and organic fertilizers available in the state. In our case it is
Sangli.

B. Capacity of existing facilities.

Our production capacity of existing facilities is 10MT per day

C. Plans for expansion.

Yes, we will be having our plan in place for the second unit of process equipment’s and
pellet making machines. Also, we are hoping of making a turnover of about 65 containers
in the next year (2019) of organic fertilizer. In addition to it the party is interested in other
organic fertilizer in bio and organic pesticides manufactured by us.

D. Product modification necessary to adapt to local environment.

Since we are sending out product packaged as per the importer’s requirements there is no
need for us to consider any product modification which is necessary to adapt to local
environment.

17
VII. Personnel strategies
A. Personnel needed to manage exports
1) Marketing manager (Exports)
2) Factory Supervisor
3) Plant Coordinator
4) Chemical Specialist (Enzyme)
5) Administrative Head (Documentation)
6) Accounts Head

B. Experience and expertise of existing personnel

6 Managing partners
Their Functions-
• Marketing (2)
• Operations (2)
• Finance
• Key Accounts Manager

1) Marketing
They will be responsible for increasing the business in that area and our agents will
partner with other local agents to generate leads and convert sales.

2) Operations
To manage the entire supply chain from sourcing to export location.
They’ll track the shipments to ensure that they are following customs rules and
regulations. Knowledge in matters like tariffs, insurance, and quotas on different
chemicals exported to different Exporting countries Categorize shipments according to a
tariff coding system. Consulting with customs agents to ease passage of shipments
through customs. Track the location of the shipment Insurance to take out on the
shipment.

3) Finance
Managing contract variations & financials, including the identification of changes,
preparing impact assessments, the preparation of internal approvals and the preparation of
financial change notes and the negotiation of contract variations.

4) Key Accounts Manager

Expertise:
Will identify new business opportunities by tapping the potential customers through
agents from different countries. Will plan, design, develop and implement different sales
activities by researching the customer's needs and requirements

C. Training needs of existing personnel

We are having marketing manager, factory supervisor, plant coordinator, chemical
specialist administrative head & accounts head. The key training needs and skills
required would be: -

18
Marketing Manager (Exports):
Soft Skills:
• Strong interpersonal communication skills
• Excellent negotiation skills
• Excellent time management and organization skills
Technical
• Proficient in computers to maintain and update various kinds of reports
• Ability to do fast mathematical computations will be an added benefit
• Able to work target-oriented work environment and should be able to prioritize
work based on the given deadlines
• Visit different countries and trade fares through which they will source order then
under them

Factory Supervisor
Soft Skills:
• Leadership quality with a good command over regional worker.

Technical:
• Manage internal factory processes.
• Ensures packaging of the finished product in done with minimalistic errors

Plant Coordinator
Soft Skills:
• Ability to manage high pressure demand orders.

Technical:
• Look after maintenance procedures of all the machines.
• Ensure optimal/desired output by meeting deadlines.
• Able to do periodic checks and trouble shoot if there is any discrepancy in the
production.

Chemical Specialist (Enzyme Supervisor)

Soft Skills: NA

Technical:
• Ability to try various formulations & come up with the best fit for the market
requirement.

Administrative Head (Documentation)

Soft Skills:
• Ability to do multi-tasking.
• Disciplined
• Punctual

19
Technical:
• Document shipments to ensure that they are following customs rules and
regulations.

Accounts Head
Soft Skills:
• Team Player- Work closely with other team members within the Project.

Technical:
• Accounting knowledge of export financing, including bonds and guarantees, Letters
of Credit and Offset or Industrial Participation
• Accountable for maintaining financial entries w.r.t new agreements and contracts.
• Proficient with latest accounting software for routine calculations.

D. Hiring needs in the short term and long term

If the export volume increases as per the plan.
We wish to hire expert personnel such as - Regional marketing managers, Commercial
Manager, Shipping Agent. We will also increase our support staff in- Production,
Operation and Administrative staff.

20
 VIII. Financial decisions
A. Pro forma financial statements and projected cash flows assuming export activity

Balance Sheet (in Rs)

Liabilities Year 1 Year 2 Year 3

Equity 1,800,000 1,800,000 1,800,000
Reserves & Surplus -1375448.4 644,574 3,418,984
Short term loans 3,000,000 5,000,000 5,000,000
Long term loans 2,100,000 3,200,000 1,900,000
Trade Payables 3409020 7386210 11,363,400
Total Liabilities 8,933,572 18,030,784 23,482,384

Assets
Machinery & Equipment’s 1,967,750 3,202,588 2,722,199
Inventory 6580621.6 14,442,997 20374984.5
Cash & Bank 6,965,822 14,828,197 20,760,185
Total Assets 15,514,193 18,030,784 23,482,384

Projected Profit and Loss (in Rs)

Particulars Year 1 Year 2 Year3

Revenue
A) Sales
Export sales 13,636,080 29,544,840 45,453,600
B) Other Revenue
Govt. Grant & Subsidy 681,804 1,477,242 2,272,680

Total Revenue 14,317,884 31,022,082 47,726,280

Expenses
A) Cost of Purchases 11,556,000 25,038,000 38,520,000
B) Fixed Expenses 1,680,000 1,680,000 1,680,000
C) Other Sales Expenses 409,082 886,345 1,363,608
C) Employee Salary and Wages 1,080,000 1,242,000 1,428,300
D) Financial Charges 621,000 966,000 835,000
E) Depreciation 347,250 565,163 480,388

Total Expenses 15,693,332 30,377,508 44,307,296

Net Profit (1,375,448) 644,574 3,418,984

21
 Projected Cash Flow Statement (in Rs)
Particulars Year 1 Year 2 Year3

Net Cash Flow from operations (1,028,198) 1,209,737 3,899,372

Net Cash Flow from Investing (2,315,000) (1,800,000) -
Net Cash Flow from Financing 6,900,000 3,100,000 (1,300,000)

Net Cash Flow 3,556,802 2,509,737 2,599,372

Cost Sheet (in Rs) 30 Cont. 65 cont. 100 cont.

Pricing
Sr. per
No Particulars Rate per unit container Year 1 Year 2 Year 3

A) Material Rs.1/Kg 24,000 720,000 1,560,000 2,400,000

(GST @ 5%) 1,200 36,000 78,000 120,000

Processing and Pelleting
B) charges Rs.9/Kg 216,000 6,480,000 14,040,000 21,600,000

C) Packing charges Rs.1/kg 24,000 720,000 1,560,000 2,400,000

Transportation Cost Rs.
D) (Fact to Port) 30000/24MT 30,000 900,000 1,950,000 3,000,000

Clearing, Fwd. & Rs.80000/co

E) Insurance Charges ntainer 80,000 2,400,000 5,200,000 8,000,000
Rs.
F) Other misc. Overheads 10000/24MT 10,000 300,000 650,000 1,000,000

G) Total 385,200 11,556,000 25,038,000 38,520,000

H) Add: 18% Profit 69,336 2,080,080 4,506,840 6,933,600

I) Total Sales 454,536 13,636,080 29,544,840 45,453,600

22
B. Identification of key assumptions

1. Assumed that the said entity is a medium scale enterprise

2. One medium container holds around 24MT of product.
3. One unit of product requires 10 units of the raw material
4. Packaging was done in a 25Kg capacity Bag
5. The product is chicken pallet and manure when establishing the export-oriented
firm, hence the projections are based on the same.
6. The inflation and escalation of variable cost has been ignored for cost sheet
computations

23
C) Current sources of funding-private and bank funding
Annual Fixed Costs (in Rs)

Sr.No Particulars Amount

1 Annual Factory Rent 600,000
2 Power and maintenance 360,000
3 Office Administration charges 240,000
4 Office Rent 480,000
Total 1,680,000

Other Sales Expenses (in Rs)

Sr.No Particulars Year 1 Year 2 Year 3

1 Agent's Commission (2% of Sales) 272,722 590,897 909,072
2 Business /Sales Promotion Expenses 136,361 295,448 454,536
Total 409,082 886,345 1,363,608

Sources of Funds (in Rs)

Sr.No Particulars Year 1 Year 2 Year 3

1) Partners’ Capital 1,800,000 1,800,000 1,800,000
2) Bank Term Loan @ 11% 2,100,000 1,400,000 700,000
3) Bank OD @ 13% 3,000,000 5,000,000 5,000,000
4) Advance from Debtors (25% of Sales) 3,409,020 7,386,210 11,363,400
5) Secured Loan for Additional Machinery - 1,800,000 1,200,000

TOTAL 10,309,020 17,386,210 20,063,400

Fixed Asset Schedule

Particulars Year 1 Year 2 Year3
Opening Balance - 1,967,750 3,202,588

Pelleting Machine 1,000,000 1,000,000 -

Reactor 300,000 300,000 -
Drier 600,000 500,000 -
Computer & Printer 140,000 - -
Office Furniture 200,000 - -
Factory Furniture 75,000 - -
-
Gross Block 2,315,000 3,767,750 3,202,588
Less: Dep @ 15% 347,250 565,163 480,388

Net Block of FA 1,967,750 3,202,588 2,722,199

24
D. Potential risk and sources of protection

1. Non-Payment by the buyer (Advance payment, Letter of Credit, ECGC cover)

2. Loss of goods in transit (Freight insurance)
3. Loss of goods due to theft & fire (Property & stock insurance)

25
IX. Implementation schedule

26
Bibliography

https://www.mordorintelligence.com/industry-reports/vietnam-organic-fertilizers-market

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