project feasibililty proposal for garment making unit

[joseph regy]

HOME   About Us   NSTEDB   Events   Feedback   Contact Us

Technology Gents Readymade Garments Product Code : 264104005 Quality and Standards : Garment Quality Guide� IS12675 Readymade Garment Packaging for Export IS 4039 Garments Guide for Positioning of Labels IS 10194 Production Capacity : Qty. : 90,000 Pcs. Shirts, 90,000 Pcs. Trousers Uploaded on : August 2007 Introduction Readymade garment industry has occupied a unique place in the industrial scenario of our country by generating substantial export earnings and creating lot of employment. Its contribution to industrial production, employment and export earnings is very significant. This industry provides one of the basic necessities of life. The employment provided by it is a source of livelihood for millions of people. It also provides maximum employment with minimum capital investment. Since this industry is highly labour-intensive, it is ideally suited to Indian condition. This project report is prepared for the manufacture of gents shirts, gents trousers as they find wide acceptance in local and international markets. Such establishments can be easily set up by any person having the knowledge of cutting and stitching operations. Market Potential Readymade garments are the choice of urban people. It is also gaining wider acceptance in semiurban and rural areas. The huge charges made by tailors and delay in delivery have made people to switch over to readymade garments. In domestic market and export market, it has made spectacular progress in the last decade. This industry is becoming very vibrant and lot of foreign investment pouring in this industry because of low risk and high earning nature of this industry. As these products are fashion oriented, entrepreneurs should always keep in mind the changing fashion styles. Considering its advantageous position, it is assumed that there will be no constraint in marketing of gents readymade garments. Basis And Presumptions 1. This project is based on single shift basis and 300 working days in a year. 2. Since this industry is labourintensive, the working efficiency is considered at 75%. 3. Costs of machinery and equipment/ material indicated refer to a particular make and approximately to those prevailing at the time of preparation of this project. 4. Installation and electrification cost is taken @ 10% of cost of machinery and equipment. 5. Non-refundable deposits, project report cost, trial production, security deposits with Electricity Board are taken under preoperative expenses. 6. Depreciation has been considered: (a) On Building @ 5% (b) On plant and machinery @ 10% (c) On office furniture and fixtures @ 15% (d) On other fixed assets @ 15%. 7. Interest on capital investment has been taken @ 14% per annum. 8. Minimum 25% of total investment is required as margin money. Implementation Schedule Implementation period in months for executing this project in stage-wise is given below : 1. Selection of site/working shed 1 month 2. Formation of company (ownership/partnership) 1 month 3. Preparation of feasibility report 1 month 4. Registration with commissioner of Industries/DIC 1 month 5. Arrangement of finance (Term loan and working capital) 3 months 6. Procurement of machinery and equipment 1 month 7. Plant erection and electrification 2 weeks 8. Arrangement of raw material including packaging material etc. 1 month 9. Recruitment of manpower 1 month 10. Selection of market channel 1 month 11. Miscellaneous works like power/water connection etc. 2 months Note: Considering that some of the above activities may be overlapping, the project implementation will take a total period of six months approximately for starting the production. Technical Aspects Process of Manufacture The process involves the following steps: Procurement of Fabric : Dyed/ bleached/printed cotton/synthetic fabrics as per demand are to be procured from the open market. The fabric will be inspected by laying on the inspection table against light before cutting so that unevenness in colour/ shade or any other fault, if any visible in the fabric are eliminated. Cutting and Stitching : The inspected fabric is placed on the cutting table in layers and then the different parts of the respective garments are demarked by a chalk as per different sizes. Cutting is carried out by the cutting machine. Stitching is carried out for individual portion of the garments by skilled workers with the help of overlock, lock stitch machines etc. Washing, Checking, Pressing and Packing : All garments are charged into washing machine containing mild detergent and washed for 4 hours in order to remove dirt and stains acquired during the manufacturing process. After washing, the garments are hydroextracted to remove excess water and after this, these garments are dried in tumbler dryer. Final checking is done before pressing and packing on the checking table so that any fault in the piece may be removed and protruding threads eliminated. The individual pieces are pressed by steam presses to remove any wrinkle marks and packed in the carton boxes. Quality Control and Standards The quality of garments mainly depends on quality of fabric used. Therefore, care must be taken while purchasing fabrics to ensure good colour fastness properties, uniformity in shade etc. Generally garments are made as per customer's specification in respect of size, design and fashion. Production Capacity (per annum) Product Quantity (pcs.) Gents Shirts 90,000 Gents Trousers 90,000 Motive Power Total 55.5 HP is required to run this unit at installed capacity. Pollution Control The process of manufacture does not generate pollution. However, entrepreneurs are to contact State Pollution Control Board for necessary guidance. Energy Conservation Maximum care should be taken while selecting the machinery and other electrical equipments so as to ensure minimum power consumption. Financial Aspects A. Fixed Capital (i) Land and Building Land 800sq.mt. @ Rs. 1500p.s.m. Amounting Rs.1200000 Building Area Factory shed 250 sq. mt. Store (Raw material) 50 sq. mt. Store (Finished goods) 50 sq. mt. Office etc. 25 sq. mt. Total Covered Area 375 sq. mt. Total Construction Cost @ Rs. 3000/sq.mt. 1125000 Total Investment in land and Building 2325000 (ii) Machinery and Equipments Sl. No. Description No. Rate (In Rs.) Amount (In Rs.) 1. Fabric inspection machine 1 200000 200000 2. 8" Power driven cloth cutting machine 1 90000 90000 3. Single needle lock stitch machine with motor 50 20000 1000000 4. 2 Needle overlock safety stitching machine with edge trimmer 1 50000 50000 5. Double Needle lock stitch machine 2 75000 150000 6. Double Needle feed of the arm machine 1 120000 120000 7. Button holing machine 1 160000 160000 8. Button stitching machine 1 75000 75000 9. Hot fusing press 1 80000 80000 10. Garment washing machine 25 kg. capacity 1 160000 160000 11. Hydroextractor 25 kg. capacity 1 90000 90000 12. Tumbler dryer 25 kg.capacity 1 160000 160000 13. Flat bed steam iron press with vacuum table 4 85000 340000 14. Zig zag embroidery machine 1 45000 45000 15. Generator set 30KVA 1 200000 200000 16. Washing room trolleys 4 12000 48000 17. Testing equipments (ends/pick checker, electronic balance, laundrometer etc.) LS 65000 65000 Total 3033000 (iii) Other Fixed Assets (Rs.) (a) Erection and installation 300000 (b) Office furniture 70000 (c) Pre-operative expenses 30000 Total 400000 Total Fixed Capital(i)+(ii)+(iii) 5758000 B. Working Capital (per month) (i) Staff and Labour Wages Sl. No. Designation No. Rate (In Rs.) Amount (In Rs.) 1. Marketing Manager 1 16000 16000 2. Sales Representative 2 8000 16000 3. Accounts Officer 1 6500 6500 4. Store-keeper 1 5000 5000 5. Clerk/Typist 2 4000 8000 6. Electrician 1 5000 5000 7. Peons/Watchman 2 3000 6000 Total 62500 Production Staff 1. Production Manager 1 16000 16000 2. Supervisors 2 8000 16000 3. Cutting Master 1 10000 10000 4. Skilled Workers 55 4800 264000 5. Pressman 4 4500 18000 6. Unskilled workers 6 3250 19500 7. Lab. Attendant 1 5500 5500 Total 411500 Perquisites @20% 82300 G.Total 493800 (ii) Raw Material (per month) Sl. No. Description Unit Qty. Rate/ Unit(Rs.) Amount (In Rs.) 1. Cotton fabric shirts mtrs 19000 90 1710000 2. Blended fabric for trousers mtrs. 12000 160 1920000 3. Trims and embellishments Nos 15000 16 240000 4. Sewing thread mtrs 15000 4 60000 5. Washing detergents     LS 3900 6. Packing material Nos 15000 4 60000   Total 3993900 (iii) Utilities (per month) (Rs.) Electricity 32000 Water Charges 2200 Fuel for generator 10000 Total 44200 (iv) Other Contingent Expenses (per month) (Rs.) (a) Advertisement and publicity 10000 (b) Postage/Stationery 2000 (c) Repair and maintenance 13000 (d) Transport/travelling charges 5000 (e) Insurance 1000 (f) Telephone 3000 (g) Miscellaneous expenses 4000 Total 38000 (v) Total Recurring Expenses (per month) 4569900 (vi) Total Working Capital for 2 months 9139800 C. Total Capital Investment (i) Land and building 2325000 (ii) Machinery and equipment 3433000 (iii) Working capital for 2 months 9139800 Total 14897800 Machinery Utilisation Capacity utilisation is considered as 75% of installed capacity. Financial Analysis (1) Cost of Production (per year) (Rs.) Recurring expenses 54838800 Depreciation on building @ 5% 116250 Depreciation on machinery @ 10% 303300 Depreciation on office furniture and other fixed assets @ 20% 80000 Interest on total investment @ 14% 2085692 Total 57424042 (2) Turnover (per year) (Sales)   Pcs. Rate/Pc. Amount (Rs.) Gents shirts 90000 290 26100000 Gents trousers 90000 390 35100000 Total 61200000 (3) Net Profit (per year) 3775958 (4) Net Profit Ratio (Net profit/Turnover per year) 6.17% (5) Rate of Return on Investment (Net Profit/Total Capital Investment) 25.35% (6) Break-even Point Fixed Cost (Rs.) Depreciation 499550 Interest on capital investment 2085692 40% of wages of staff and labour 2370240 40% of other expenses 177600 Insurance 12000 Total 5145082 B.E.P.       = Fixed cost × 100 ------------------------     Fixed cost + Profit         = 57.67% Contact for more information: Information Manager TIMEIS Project E-mail: tim...@ficci.com

Follow Rediff Deal ho jaye! to get exciting offers in your city everyday.

[shubhda gupta]

Thanks a lot sir.

Regards

Shubhda