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Sudha Surender Pal: Manufacturing of Paper Plates, Cups, Glasses etc Query Resolution

18th March, 2011

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Contents
Query Summary ........................................................................................................................................ 3 Resolution ................................................................................................................................................. 3 Next Steps ................................................................................................................................................. 6 About Us ................................................................................................................................................... 7

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Query Summary
Client Name: sudha surender pal Query Date: 17/03/2011 Business Result Area: Business Planning Client Delivery Manager: 91-02-4 Query Type: Free, SMEToolkit India SLA*: Not Applicable

*SLA (Service Level Assurance) is only applicable for our premium members

Query Description: Topic: Manufacturing of paper plates, cups, glasses etc. I am planning to start small scale business in manufacturing the titled products. With Government support to encourage the paper products, how far I can go in starting my project. Being a woman, can I go ahead with this item?

Resolution
Our understanding of your current status: 1. You want to establish a paper plate, cups and glass manufacturing unit.
Your Query / Queries to Us & Their Resolution:

1. Components of a sound business plan for a paper plate manufacturing unit a. Opportunity assessment and capacity planning You should first determine the demand for paper plate, glasses and cups in the geographical area which you wish to serve. You should identify the major customer segments which need paper plates, glasses and cups for their business or domestic consumption. Some of the major customer segments can be: Caterers (who are hired for catering food in wedding and parties) who serve snacks in paper plates and use paper cups and glasses Restaurants Hawkers which sell food items on the roadside Manufacturers of decorative items which need paper plates Domestic usage

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You should get a ballpark estimate for demand of these products from all these segments. For example, you can count the number of caterers in your geographical area. Then you can identify the number of parties/ wedding ceremony served by them in a month. Then you can estimate the average number of guests in a party, and paper plates & glasses needed per guest. By multiplying these figures, you can estimate the demand for these products from caterers. You can similarly estimate the demand from other segments. After that you need to find out the current supply of these products in the market, and consequently demand supply gap. Then you should decide what percentage of this demand supply gap and the percentage of current market you wish to serve. This will help you in estimating the manufacturing capacity of your unit. b. Location analysis You need to select a suitable location for the proposed manufacturing unit. You can use specific criteria to support the location. The location should be closer to the intended customers. It should be closer to the suppliers of raw materials required in the plant. It should have good infrastructure in terms of connectivity, and power supplies. It should be located in an area, where you can easily source, attract, and recruit people for your plant. c. Manpower resource planning Estimate the manpower required for the manufacturing plant on the basis of capacity of the plant. Estimate the manpower in both the administrative and managerial role. d. Competition analysis You should analyze strategies followed by the established manufacturers across following functions: Sourcing of raw materials Ensuring quality of the product Pricing Policy Branding & marketing strategy Customer relationship management Financing Strategy You should determine which of the above strategy/ practices you can follow without incurring too much cost. e. Supply chain management Paper, and aluminum foil are the main raw materials used in the paper plate & cup manufacturing. Identify the suppliers of these raw materials on the basis of specific criteria such as reputation, lead time in supplying the material, credit term extended etc. You should try to negotiate better pricing with your suppliers
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by promising them prompt payment. Also, you should have a strict quality check on the quality of paper used at the time of receipt of raw material from the suppliers. f. Customer acquisition strategy Since you will be a new player in the market, you will need to have a strong value proposition to create a market for yourself. For that you first need to identify the target segment for your product. You should determine the attributes of your target segments (such as who will need these products in bulk, who make prompt payment etc). Then you will need to make marketing strategy for each customer segment. To establish your identity, you can enter into an arrangement with the buyers, where you can sell your paper products at lower prices (as compared to competitors) at the start. Once the buyer is assured of your higher quality, you can then raise the price. Also you can enter into long term arrangement with your customers by offering your products at discounted price. g. Quality assurance Quality of the paper plate is very important for ensuring your success in the market. You need to ensure the quality control at all points of your value chain. You can take following measures to ensure quality Quality of raw materials Best practices in manufacturing to ensure quality Training and sensitizing your employees towards the need to ensure quality Ensuring quality during the transport of final products to the customers Taking quality certifications (in long term) h. Financial Analysis Capital expenditure required for the plant for the land, machinery, installation of plant Operating expenditure for the plant Salary, electricity, fuel, transportation Initial working capital requirement Debt- equity ratio for funding the capital expenditure and initial working capital requirement Source of debt and equity Profit and loss statement, and balance sheet for the manufacturing plant for the life of the plant Profit, and return on equity This resolution is provided basis the limited information we have about you. To know more about different aspects of an effective business plan, please visit the following link:
http://365businessdays.com/PublicSite/Advisory.aspx?AdvisoryID=3

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If you need our support to help you develop the business plan, it will require us to understand the level of support you need, and your previous expertise in the sector. We always begin our relationship in an extremely cost efficient online method and then depending upon the need of the client; deepen the relationship to offline engagement with considerable advantages of cost and turnaround time for delivery over comparable services. You could get to know more about our services by visiting http://365businessdays.com/PublicSite/takeatour.aspx Being a woman, should not stop you for pursuing this venture. If you can build capabilities and a team required to run such a venture, you will be definitely successful.

Next Steps

We wish you success in your desire to establish a paper plate, cup & glass manufacturing unit, and will be extremely willing to provide you all the support that we can to help you achieve this aspiration. We are committed to providing skill based research and analytics support to our Premium Members to help them drive their business. When you sign up as a Premium Member and we engage with you to support you for developing and implementing your marketing plan and support you in the content development process, you can be assured of access to a pool of high quality business management professionals with deep expertise in 80 skill areas that drive any business.
http://www.365businessdays.com/PublicSite/BusinessConcept.aspx

As for example, we will help you In opportunity assessment, and the capacity planning for the unit Developing a model for choosing the location for the plant Deciding criteria for selecting suppliers, and recommending a suitable supplier for the raw material required in the plant Customer acquisition strategy
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 Quality assurance strategy Financial analysis, and calculation of financial return from the plant Raising funds from different sources
About Us
SME ToolKit The SME Toolkit is a joint project of IFC (International Finance Corporation), a member of the World Bank Group and ICICI Bank. The Toolkit website has been created as an online resource centre to empower Indian SMEs and help them become globally competitive http://india.smetoolkit.org/india/en 365BusinessDays 365BusinessDays provides high quality, well researched, relevant and neutral external skill support in a cost efficient manner to our customers. We provide this service through a secure and easy to use proprietary online platform. To know more about our services please visit our Take a Tour section. Please click here to Sign up for our Business Advisory Services.

DISCLAIMER:
All due care has been taken in the preparation of this report to ensure that the information, estimates, opinions, suppositions, suggestions, and recommendations contained here-in are factually correct and accurate to the best of our knowledge, at the time of generating and publishing this report. In particular as our Query Resolution service is not based on any Primary Data collection and analysis, there can be inherent challenges in the depth and scope of the issues it can address. We, at 365BusinessDays, accept no liability for any loss or damage or unforeseen consequential loss or damage that may arise from the use of the information contained within this report. The information, estimates, opinions, suppositions, suggestions, and recommendations within this report cannot be guaranteed, and readers are advised to use this information and the implications there-in at their own discretion and risk. The information published in this report may be subject to change without notice at any time, and we accept no liability or obligation to inform the readers or users of this report of such changes.

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