DIKSHA VERMAENTRE TRMPAPER

8/8/2019 DIKSHA VERMAENTRE TRMPAPER

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Vocational Training Center for Employment Generation (VTCEG)

Agribusiness Products

(Term Paper of Entrepreneurship & Business Plan.)

Submitted as a partial requirements of MBA IIIst semester

Submitted to:-

Mr. Rajan Girdhar

Lecturer: - Entrepreneurship & Business Plan.

LSB. (LPU)

LOVELY PROFESSIONAL UNIVERSITY

PHAGWARA

Business Plan for a Startup Business

A business plan is a formal statement of a set of business goals, the reasons why

they are believed attainable, and the plan for reaching those goals. It may also

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contain background information about the organization or team attempting to reach

those goals.

The business goals may be defined for for-profit or for non-profit organizations.

For-profit business plans typically focus on financial goals, such as profit or

creation of wealth. Non-profit and government agency business plans tend to focus

on organizational mission which is the basis for their governmental status or their

non-profit, tax-exempt status, respectivelyalthough non-profits may also focus

on optimizing revenue. In non-profit organizations, creative tensions may develop

in the effort to balance mission with "margin" (or revenue).

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Business Plan

OWNERS

Opportunity for Youth

Kangra (H.P)

Telephone 09780158700

E-Mail [email protected]

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mailto:[email protected]://in.wrs.yahoo.com/_ylt=A0WTf2luZh5LHgMBlju9HAx.;_ylu=X3oDMTBqdGFzdWxiBHBvcwMxNQRzZWMDc3IEdnRpZAM-/SIG=1h0n2rdgh/EXP=1260369902/**http%3A/in.images.search.yahoo.com/images/view%3Fback=http%253A%252F%252Fin.images.search.yahoo.com%252Fsearch%252Fimages%253Fp%253DHANDICRAFTS%2526ei%253DUTF-8%2526rd%253Dr1%2526fr%253Dyfp-t-704%26w=91%26h=136%26imgurl=www.shawbrothersindia.com%252Fpcat-gifs%252Fproducts-small%252Fhandicrafts3.jpg%26rurl=http%253A%252F%252Fwww.shawbrothersindia.com%252Fhandicrafts.html%26size=7k%26name=handicrafts3%2Bjpg%26p=HANDICRAFTS%26oid=208c902156bfd042%26fr2=%26no=15%26tt=606409%26sigr=11hr1g68p%26sigi=123jrr3jr%26sigb=12pihqbu6http://in.wrs.yahoo.com/_ylt=A0WTf2luZh5LHgMBhju9HAx.;_ylu=X3oDMTBpZTByOGFiBHBvcwMyBHNlYwNzcgR2dGlkAw--/SIG=1hf3ngtgv/EXP=1260369902/**http%3A/in.images.search.yahoo.com/images/view%3Fback=http%253A%252F%252Fin.images.search.yahoo.com%252Fsearch%252Fimages%253Fp%253DHANDICRAFTS%2526ei%253DUTF-8%2526rd%253Dr1%2526fr%253Dyfp-t-704%26w=500%26h=361%26imgurl=static.flickr.com%252F170%252F399423302_0c24700261.jpg%26rurl=http%253A%252F%252Fwww.flickr.com%252Fphotos%252Fstefansprograms%252F399423302%252F%26size=163k%26name=Handicrafts%2B6%26p=HANDICRAFTS%26oid=1aeb238826460e8e%26fr2=%26fusr=stefanottoma...%26no=2%26tt=606409%26sigr=11n2096qg%26sigi=11eqs1em3%26sigb=12pihqbu6mailto:[email protected]


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I. Table of Contents

I.Table of Contents .................................................................................4

II.Executive Summary ............................................................................5

III.General Company Description ............................................................6

IV.Products and Services ........................................................................7

V.Marketing Plan ....................................................................................9

VI.Operational Plan ...............................................................................12

VII.Personal Financial Statement ..........................................................21

VIII.Startup Expenses and Capitalization ..............................................22

IX.Financial Plan ...................................................................................23

X.Appendices ........................................................................................32

XI.Refining the Plan ..............................................................................33

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II. Executive Summary

The business plan is based upon the agricultural products i.e. Sauce and Pickle(Mixed) the location is Kangra (H.P). In agriculture, agribusiness is a generic term

for the variousbusinesses involved in food production, including farming and

contract farming, seed supply, agrichemicals, farm machinery, wholesale and

distribution,processing, marketing, and retail sales. The term has two distinctly

different connotations depending on context.

Within the agriculture industry, agribusiness is widely used simply as a convenient

portmanteau of agriculture and business, referring to the range of activities and

disciplines encompassed by modern food production. There are academic degrees

in and departments of agribusiness, agribusiness trade associations, agribusiness

publications, and so forth, worldwide. Here, the term

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http://en.wikipedia.org/wiki/Agriculturehttp://en.wikipedia.org/wiki/Businesshttp://en.wikipedia.org/wiki/Foodhttp://en.wikipedia.org/wiki/Farminghttp://en.wikipedia.org/wiki/Contract_farminghttp://en.wikipedia.org/wiki/Seedhttp://en.wikipedia.org/wiki/Agrichemicalhttp://en.wikipedia.org/wiki/Agricultural_machineryhttp://en.wikipedia.org/wiki/Wholesalehttp://en.wikipedia.org/wiki/Processed_foodhttp://en.wikipedia.org/wiki/Marketinghttp://en.wikipedia.org/wiki/Retailhttp://en.wikipedia.org/wiki/Industryhttp://en.wikipedia.org/wiki/Portmanteauhttp://en.wikipedia.org/wiki/Academic_degreeshttp://en.wikipedia.org/wiki/Trade_associationshttp://en.wikipedia.org/wiki/Publicationshttp://en.wikipedia.org/wiki/Agriculturehttp://en.wikipedia.org/wiki/Businesshttp://en.wikipedia.org/wiki/Foodhttp://en.wikipedia.org/wiki/Farminghttp://en.wikipedia.org/wiki/Contract_farminghttp://en.wikipedia.org/wiki/Seedhttp://en.wikipedia.org/wiki/Agrichemicalhttp://en.wikipedia.org/wiki/Agricultural_machineryhttp://en.wikipedia.org/wiki/Wholesalehttp://en.wikipedia.org/wiki/Processed_foodhttp://en.wikipedia.org/wiki/Marketinghttp://en.wikipedia.org/wiki/Retailhttp://en.wikipedia.org/wiki/Industryhttp://en.wikipedia.org/wiki/Portmanteauhttp://en.wikipedia.org/wiki/Academic_degreeshttp://en.wikipedia.org/wiki/Trade_associationshttp://en.wikipedia.org/wiki/Publications


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III. General Company Description

An Idea- Agribusiness Products by the Brand name of (VTCEG)

Benefits-

PERSONAL

1) Profit Max.

2) To use expertise/knowledge

SOCIAL

1) Employment Generation

2) Remove Poverty

3) Favorable for customer

Target Market- Kangra (H.P).

Business Type- Life Style (15-20) employees.

Products Sauce (Tomato), Pickle (Mixed).

Capital- 2, 50,000 (Loan from Co-op Bank), 2, 50000 Self Financed...

Demographics- /Customers- all segments because it is the need of every INDIAN

household.

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IV. Products and Services

PRODUCTS- Sauce (Tomato), Pickle (Mixed)

MARKET- Rural and Urban (Main Focus)

DEMOGRAPHIES/Customers- all segments because it is the need of every

INDIAN household, because Indians are more passionate towards the spicy.

Demographics ordemographic data are the characteristics of a population as

used in government, marketing or opinion research, or the demographic profiles

used in such research. Note the distinction from the term "demography" (see

below.) Commonly-used demographics include sex, race, age, income, disabilities,mobility (in terms of travel time to work or number of vehicles available),

educational attainment, home ownership, employment status, and even location.

Distributions of values within a demographic variable, and across households, are

both of interest, as well as trends over time. Demographics are frequently used in

economic and research. It is important to distinguish between demographics and

psychographics

Frequency Of Purchase (Monthly) - 1 Kg. (Family having 2-5) members

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http://en.wikipedia.org/wiki/Marketinghttp://en.wikipedia.org/wiki/Demographic_profilehttp://en.wikipedia.org/wiki/Demographyhttp://en.wikipedia.org/wiki/Race_(classification_of_human_beings)http://en.wikipedia.org/wiki/Economicshttp://en.wikipedia.org/wiki/Psychographicshttp://in.wrs.yahoo.com/_ylt=A0WTf2xEZx5LOdoA4Yq9HAx.;_ylu=X3oDMTBpZm5udGl1BHBvcwM1BHNlYwNzcgR2dGlkAw--/SIG=1ilql9tb2/EXP=1260370116/**http%3A/in.images.search.yahoo.com/images/view%3Fback=http%253A%252F%252Fin.images.search.yahoo.com%252Fsearch%252Fimages%253Fp%253Dspicy%252Bmango%252Bpickles%2526sado%253D1%2526ei%253Dutf-8%2526fr%253Dyfp-t-704%2526fr2%253Dsg-gac%26w=500%26h=333%26imgurl=static.flickr.com%252F2039%252F2292339761_6580fe6006.jpg%26rurl=http%253A%252F%252Fwww.flickr.com%252Fphotos%252Flavannya%252F2292339761%252F%26size=173k%26name=More%2BPickles%26p=spicy%2Bmango%2Bpickles%26oid=4276e57c033d7948%26fr2=sg-gac%26fusr=lavannya%26no=5%26tt=29%26sigr=11h6d4edo%26sigi=11glj1eun%26sigb=13d7d4gfihttp://in.wrs.yahoo.com/_ylt=A0WTf2xEZx5LOdoA34q9HAx.;_ylu=X3oDMTBpaWhqZmNtBHBvcwMzBHNlYwNzcgR2dGlkAw--/SIG=1i7t4mnhl/EXP=1260370116/**http%3A/in.images.search.yahoo.com/images/view%3Fback=http%253A%252F%252Fin.images.search.yahoo.com%252Fsearch%252Fimages%253Fp%253Dspicy%252Bmango%252Bpickles%2526sado%253D1%2526ei%253Dutf-8%2526fr%253Dyfp-t-704%2526fr2%253Dsg-gac%26w=110%26h=181%26imgurl=www.baxters.com%252Fimages%252Fcore%252FMango-Chutney.jpg%26rurl=http%253A%252F%252Fwww.baxters.com%252Fproducts%252Fmango-chutney.html%26size=38k%26name=Mango%2BChutney%2Bjp...%26p=spicy%2Bmango%2Bpickles%26oid=548115e3907c2f68%26fr2=sg-gac%26no=3%26tt=29%26sigr=11ijq5q25%26sigi=11dqgi57b%26sigb=13d7d4gfihttp://en.wikipedia.org/wiki/Marketinghttp://en.wikipedia.org/wiki/Demographic_profilehttp://en.wikipedia.org/wiki/Demographyhttp://en.wikipedia.org/wiki/Race_(classification_of_human_beings)http://en.wikipedia.org/wiki/Economicshttp://en.wikipedia.org/wiki/Psychographics


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QUALITY MAINTAINANCE

Vinegar based Chemicals are used to preserve products from Algae.

Supervisor will be there to quality Audits.

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V. Marketing Plan

PRODUCTS- Sauce (Tomato), Pickle (Mixed) LAZEEZ LOGO

MARKET- Rural and Urban (Main Focus)

DEMOGRAPHIES/Customers- all segments because it is the need of every

INDIAN household.

Frequency of Purchase (Monthly) - 1 Kg. (Family having 2-5) members

COMPETETOR Analysis-

PICKLE

Aeroplane, Pachranga, PAN, KISSAN. Etc

Competitor Pricing-

120 per Kg. (Kissan, Pan)

80-95 per Kg. (Local Vendors)

SAUCE (Tomato)

Kissan- 57 per kg.

Local Products- 45 per Kg.

All figures are taken from original amount of products (MRP) including all

taxes and VAT

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OUR PRICING

Type--(Competitive Pricing)

For Pickle

100 Rs. per Kg. (Mixed Only)

For Sauce

55 Rs. per Kg.

Quality Maintenance

Vinegar based Chemicals are used to preserve products from Algae.

Supervisor will be there to quality Audits.

Advertisement Mgt.

For Rural Market--

Local Cable Networks are best.

Banners in local fairs & Gatherings (Punchayats)

Print advertisement in Local News-papers

For general market

Banners. Hoardings, Local News Papers etc

Product

Mainly two products are going to be produced pickle, sauce.

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Features and Benefits

PERSONAL

1) Profit Max.

2) To use expertise/knowledge

SOCIAL

1) Employment Generation

2) Remove Poverty

3) Favorable for customer

Customers

All segments because it is the need of every INDIAN household.

Competition

Aeroplane, Pachranga, PAN, KISSAN. Etc

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VI. Operational Plan

Following data will throw some light on the daily operation of our business, its

location, equipment, people, processes, and surrounding environment.

Production

How and where our products or services shall be produced?

We shall be producing Pickle and sauce at our factory which is situated at main

road on kangra and would provide us an easy access to Himachal Pradesh.

Our methods of

Production techniquesMost of the job shall be done by machines

but much supervision would be required to ensure quality goods and also

we would be starting at a small scale, so very few machines would be

required to produce them and we shall opt for semi automatic machines,

and the cutting of pickles raw material will be with the cutter. For

handcraft there is a need of carpeting tools

Quality control- We shall keep a proper check on quality of rawmaterial when it shall be received and also each batch of our final produce

shall be tested.

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Customer service- Our VP- Marketing shall be personally visiting

our distributors & retailers once in a month and listen to the problems faced

if any by them in selling our product. Any type of feedback from customer

shall be cordially invited and we shall try to satisfy our customer to the

fullest extent.

Inventory control- Since the items is not too costly and its initial

demand may not be too high, so we shall keep a minimum stock of raw

materials for 3-4 days which would be sufficient to produce goods and

would try to use Economic Order Quantity and Just in Time policies tomanage our inventory.

Location

What qualities do we need in a location and the type of location well choose?

Physical requirements:

Amount of space- We need not require to store much raw material

as our ingredients are lemon, mango, garlic, cauliflower, ginger and tomato

of pickle and sauce respectively because these are not stored more 5 to 10

days. But to make the handcraft we can easily take the bamboo fromanywhere in Himachal Pradesh as Kangra is a hilly area and in these areas

trees of bamboos are easily available. We shall carry put operations in a

factory of 10 square Yards as the machinery required is not too huge in size.

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We shall be allocating a small space for offices of our Instructors and

management..

Type of building- The Building shall be single storied and shall be

divided into various parts- Shed for storing raw material & Two large

rooms for different processes of production. One Room having different

cabins for our instructor and management.

Power and other utilities- We shall require an electricity

connection of around 2 to 3 Kilowatts.

Construction:

We shall be spending around Rs.6-8 Lacks for the whole business start-up.

Costs: As the total budget is Rs. 800000 including the first step to the last steps of

distribution and advertisement. The description of the finance is as below

Transportation Rs.150000

Material for pickle Rs.10000

Bamboo( raw form) Rs.100 per crop=10000

Tools and equipment Rs.10000

Preserve Rs.5000

Packing expenses Rs.10000

Salary expenses Rs.15000

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Advertisement Rs.100000

Building Rs.100000

Total Rs.450000(approx.)+100000(as working

capital)=Rs. 550000

The main constraint is the money invested cannot exceed by Rs.800000 because

we have limited money so fund management required efficiently

Personnel

Number of employees:

There are total 35 employees in the whole process

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DISTRIBUTION OF EMPLOYEES ACC. TO THE

OPERATIONS

FUNCTIONS

Distribution of manpower Distribution of manpowers

7 pickle 2 Distribution of manpower Distribution of

13 per handcraft 5people manpower 3

Suppliers

R/M 2diver2cab

Type of labor

Making pickle, sauce and handcraft does not require much

technical skills on the part of workers. So, semiskilled laborers can be trained

to work on machines.

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Productionoperation

Auditingrectification

Suppliers ofR\M section Supply chain

and logistics


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Where and how will you find the right employees?

For sales executive we will prefer local energetic and enthusiastic people, who

have knowledge about the domestic market.

We think we will be able to procure workers from the region where our plant is

going to be established. Our plant will be situated at Kangra, Himachal

Pradesh and raw material source is also not too far. Skilled or semi-skilled

workers can be hired from the places or villages around for the purpose.

Training methods and requirements:

As we are hiring semi-skilled workers, some sort of training will be essential

for all the workers. We will give them On the Job Training. The will be

working on original machines and production of the pickle, sauce will continue

even during training.

Legal Environment

Licensing and bonding requirements:-contractual agreement giving right

to others to use intellectual property in return for a royalty or fee

Trademarks (pending, existing, or purchased: - A distinguishing

word.name or symbol used to identify a product.

Copyright:-right given to prevent from printing, copying, or publishing any

original works of authorship

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Personnel

Type of labor :-as such their is no specific skilled labor we required because

we set our plant in hibachi Pradesh and our business mainly deals with

handicrafts ,pickles and house wife's who are willing to work they can use

help to make pickles, handicrafts ,sauces.

Training methods and requirements: - there is no need to require for training

an house wifes, illiterate womens they can already know how make pickle,sauces etc

Inventory

What kind of inventory will you keep: raw materials, supplies, finished

goods? For pickles and sauces we need fresh vegetables tomato's etc

We shall keep raw materials (Herbal Plants), our work in progress at

different stages and finally finished as pickles, handcrafts

Suppliers

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Names and addresses:-vocational centre for employment generation,

dust. Kangra himachal pradesh

Type and amount of inventory furnished

Credit and delivery policies

Managing Our Accounts Payable

We shall be purchasing goods on 7 days credit as our average inventory period for

raw material would be 3-4 days and for finished goods shall be 3 days. However

the business is wholly cash & carries business, so we think we shall be able to pay

our creditors after realizing the cash from debtors.

Do our proposed vendors offer prompt payment discounts?

If any vendor offers us attractive discounts on cash payment, we may opt for the

offer depending upon the availability of cash with us.

Management and Organization

Who will manage the business on a day-to-day basis? What experience does that

person bring to the business? What special or distinctive competencies? Is there a

plan for continuation of the business if this person is lost or incapacitated?

If youll have more than 10 employees, create an organizational chart showing the

management hierarchy and who is responsible for key functions.

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Include position descriptions for key employees. If you are seeking loans or

investors, include resumes of owners and key employees.

Professional and Advisory Support

List the following:

Board of directors

Management advisory board

Attorney

Accountant

Insurance agent

Banker

Consultant or consultants

Mentors and key advisors

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VII. Personal Financial Statement

Includepersonal financial statements for each owner and major stockholder,

showing assets and liabilities held outside the business and personal net worth.

Owners will often have to draw on personal assets to finance the business, and

these statements will show what is available. Bankers and investors usually want

this information as well.

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VIII. Startup Expenses and Capitalization

You will have many startup expenses before you even begin operating your

business. Its important to estimate these expenses accurately and then to plan

where you will get sufficient capital. This is a research project, and the more

thorough your research efforts, the less chance that you will leave out important

expenses or underestimate them.

Even with the best of research, however, opening a new business has a way of

costing more than you anticipate. There are two ways to make allowances forsurprise expenses. The first is to add a little padding to each item in the budget.

The problem with that approach, however, is that it destroys the accuracy of your

carefully wrought plan. The second approach is to add a separate line item, called

contingencies, to account for the unforeseeable. This is the approach we

recommend.

Talk to others who have started similar businesses to get a good idea of how much

to allow for contingencies. If you cannot get good information, we recommend a

rule of thumb that contingencies should equal at least 20 percent of the total of all

other start-up expenses.

Explain your research and how you arrived at your forecasts of expenses. Give

sources, amounts, and terms of proposed loans. Also explain in detail how much

will be contributed by each investor and what percent ownership each will have.

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IX. Financial Plan

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CASH FLOW STATEMENT

YEAR 1 YEAR 2 YEAR 3 YEAR 4

cash flow from operating

activities

cash sale 4252000

552500

0

645200

0

770000

0

Sub total Cash from

Operations 4252000

552500

0

645200

0

770000

0

Additional Cash Received

Sales Tax 0 0 0 0

New Current Borrowing 0 0 0 0

New Long-term Liabilities 0 0 0 0

Sales of Other Current

Assets 0 0 0 0

Sales of Long-term Assets 0 0 0 0

New Investment Received 0 0 0 0

Subtotal Cash Received 4252000

552500

0

645200

0

770000

0

Expenditures from Operations

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Cash Spending

3534460

0

455020

0

519502

0

626352

0

Subtotal Spent on

Operations

3534460

0

455020

0

519502

0

626352

0

Additional Cash Spent 0 0 0 0

Sales Tax 170080 221000 258080 308000

Principal Repayment of Current

Borrowing 0 0 0 0

Purchase Other Current

Assets 0 0 0 0

Purchase Long-term

Assets 0 0 0 0

Dividends 0 0 0 0

Subtotal Cash

Spent 3714680

477120

0

545310

0

657152

0

Net Cash Flow 537320 753800 998900

112848

0

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PROFIT AND LOSS

ACCOUNT

PARIICULAR 1 YEAR

2

YEAR

3

YEAR

4

YEAR

5

YEA

Sales 4252000

552500

0

645200

0

770000

0

885

direct cost of sale 2126000

276250

0

322600

0

385000

0

442

other product expenses 0 0 0 0

total cost of sale 2126000

276250

0

322600

0

385000

0

442

gross margin% 50% 50% 50% 50% 5

expenses

payroll 942000

103620

0

113982

0

125380

0

137

marketing expense 600000 400000 380000 750000 800

electricity 180000 190000 200000 210000 220

telephone 30000 30000 30000 30000 30

utility 0 0 0 026


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Balance

sheet

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PARTICULARS YEAR 1 YEAR 2 YEAR 3 YEAR 4

Share capital 1000000 1000000 1000000 100000

Reserves and surplus 0 0

secured loans 500000 500000 500000 50000

current liabilities and

loans

provision 280000 300000 320000 34000

1780000 1800000 1820000 184000

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PARTICULARS YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5

Fixed assets

cab

30000

0

depreciatio

n 30000 227000 224000 221000 218000 215000

machinery

20000

0

depreciatio

n 20000 180000 160000 140000 120000 100000

current assets 835680 662200 460100 373520 287750

cash 537320 753800 998900

112848

0

147983

0

miss.exp 0 0 0 0 0

178000

0

180000

0

182000

0

184000

0

183600

0

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SALARY monthly

Employees salary(Rs) total

2 marketing executives 5000 10000

2 driver 2500 5000

3 helper 1500 4500

workers

6 skilled 4000 24000

4 unskilled 2500 10000

6 packaging 1500 9000

2 supervisor 8000 16000

78500

FIXED EXPENSES

advertisement

local cable expense 15000

local newspaper 10000

hoardings 20000

pan flit 5000

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cab{2} 300000

electricity/ month 15000

rent/ month 10000 10000

tools & equipments 200000 200000

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X. Appendices

Include details and studies used in your business plan; for example:

Brochures and advertising materials

Industry studies

Blueprints and plans

Maps and photos of location

Magazine or other articles

Detailed lists of equipment owned or to be purchased

Copies of leases and contracts

Letters of support from future customers

Any other materials needed to support the assumptions in this plan

Market research studies

List of assets available as collateral for a loan

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XI. Refining the Plan

The generic business plan presented above should be modified to suit your specific

type of business and the audience for which the plan is written.

For Raising Capital

For Bankers

Bankers want assurance of orderly repayment. If you intend using this plan

to present to lenders, include:

o Amount of loan

Capital- 2, 50,000 (Loan from Co-op Bank), 2, 50000 Self Financed...

Documents

DIKSHA VERMAENTRE TRMPAPER