Pre-Feasibility Study

LAUNDRY & DRY CLEANING

Small and Medium Enterprise Development Authority
Government of Pakistan
www.smeda.org.pk
HEAD OFFICE 6 Floor LDA Plaza Egerton Road, Lahore Tel 111 111 456, Fax: 6304926-7 Website www.smeda.org.pk Helpdesk@smeda.org.pk
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helpdesk@smeda.org.pk

March 2008

Pre-Feasibility Study

Laundry & Dry Cleaning

DISCLAIMER
The purpose and scope of this information memorandum is to introduce the subject matter and provide a general idea and information on the said area. All the material included in this document is based on data/information gathered from various sources and is based on certain assumptions. Although, due care and diligence has been taken to compile this document, the contained information may vary due to any change in any of the concerned factors, and the actual results may differ substantially from the presented information. SMEDA does not assume any liability for any financial or other loss resulting from this memorandum in consequence of undertaking this activity. The prospective user of this memorandum is encouraged to carry out additional diligence and gather any information he/she feels necessary for making an informed decision. For more information on services offered by SMEDA, please contact our website: www.smeda.org.pk

DOCUMENT CONTROL
Document No. Prepared by Approved by Revision Date Issued by PREF-78 SMEDA-Punjab Provincial Chief Punjab March, 2008 Library Officer

PREF-78/ March, 2008/Rev2

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........................................................2 7............................................................................... 4.............2 8................................................................. 11........4 7...1 6.............................................. 14 9.......... 9 RAW MATERIAL REQUIREMENT ..............................8 4..................................................................... 18 FINANCIAL ASSUMPTIONS ....................................................................................................................................... 14 PROJECT COST................................................................................. 7 5...........................................................................1 ESTIMATED TIME FOR PROJECT COMPLETION ................................................................................................................2 MARKET POTENTIAL .........7 4........4 LAND REQUIREMENT .............. PRODUCTION PROCESS............................Pre-Feasibility Study Laundry & Dry Cleaning 1.. 7 5.................................. 5 OPPORTUNITY RATIONALE ...........................................................................................................................................................................................................................................1 11........................................................1 7..............................2 4............... 8 7.................................................................................................................................................................. 10 REVENUES ........................................................................1 SECTOR CHARACTERISTICS ................................................................................................ 7 PROPOSED LOCATION ...............................................4 4................................................ INTRODUCTION TO SMEDA.............. 10 TECHNOLOGY AND PROCESSES ............................................... 13 9..................................... 3......................................................... LAND & BUILDING REQUIREMENT ......................... 6 PROJECT CAPACITY AND RATIONALE .................1 4...3 12............... 6 PROPOSED PRODUCT MIX ..........................5 4...........9 PROJECT BRIEF ............ SECTOR & INDUSTRY ANALYSIS....................3 8...... 17 PROJECTED CASH FLOW STATEMENT ....... 4 CRUCIAL FACTORS & STEPS IN DECISION MAKING FOR INVESTMENT....................... 13 RECOMMENDED MODE ....................... 16 PROJECTED BALANCE SHEET ..................................................... PREF-78/ March....................... 2................................................................................................ 8 TARGET CUSTOMERS .....6 4............................. 5 MARKET ENTRY TIMING .......................................................................... 2008/Rev2 3 . 15 FINANCIAL ANALYSIS ...................................................................... 11 MACHINERY REQUIREMENT ......................................................................................................................................... 6 RECOMMENDED PROJECT PARAMETERS ............................. 11 TOTAL MACHINE MAINTENANCE ................................................... 11.............................. 7 6................. 5 PROJECT PROFILE.............................................................. MARKET INFORMATION ............................ 13 SUITABLE LOCATION.............................................................3 4.........................................................................3 7.................. 6 PROJECT INVESTMENT .............................. 5 4............................................................................................... 19 10.................. 13 COVERED AREA REQUIREMENT .................................................................................. 5 PROPOSED BUSINESS LEGAL STATUS ............... HUMAN RESOURCE REQUIREMENT.......................................................................................................................................................................................................................................... 4 PURPOSE OF THE DOCUMENT ...... 13 8.........6 PRODUCTION PROCESS FLOW .2 11....................................................................................................................................5 7...........................................1 8...................... 8 6............ 16 PROJECTED INCOME STATEMENT ........................................................................................................................................................................ 9 7.. 12 8....................................

2. SMEDA has so far successfully formulated strategies for sectors including. Since its inception in October 1998. A few priority sectors were selected on the criterion of SME presence. marble and granite. Whereas the task of SME development at a broader scale still requires more coverage and enhanced reach in terms of SMEDA’s areas of operation. These services include identification of viable business opportunities for potential SME investors. PURPOSE OF THE DOCUMENT The objective of the pre-feasibility study is primarily to facilitate potential entrepreneurs in project identification for investment. Before studying the whole document one must consider following critical aspects. production. Pre-feasibility studies and business plan development are some of the services provided to enhance the capacity of individual SMEs to exploit viable business opportunities in an effective way. In order to facilitate these investors. marketing. gems and jewelry. transport and dairy. brief on government policies and international scenario. which forms the basis of any investment decision. marine fisheries. fruits and vegetables. the document/study covers various aspects of project concept development. marketing. This particular pre-feasibility is regarding “Laundry & dry cleaning” which comes under “service” sector. textiles. In depth research was conducted and comprehensive development plans were formulated after identification of impediments and retardants. PREF-78/ March. 2008/Rev2 4 . leather and footwear. These documents consist of information required to make well researched investment decisions. The project pre-feasibility may form the basis of an important investment decision and in order to serve this objective. Along with the sectoral focus a broad spectrum of business development services is also offered to the SMEs by SMEDA. INTRODUCTION TO SMEDA Small and Medium Enterprise Development Authority (SMEDA) was established with the objective to provide fresh impetus to the economy through the launch of an aggressive SME support program. finance and business management. SMEDA had adopted a sectoral SME development approach. The document also provides sectoral information.Pre-Feasibility Study Laundry & Dry Cleaning 1. technology and human resource development. The all-encompassing sectoral development strategy involved overhauling of the regulatory environment by taking into consideration other important aspects including finance. surgical instruments. start-up. SMEDA provides help desk services as well as development of project specific documents. which have some bearing on the project itself.

suits etc. These services range from washing.e. shirwanis and suits etc. The life style of the people in Pakistan has changed over the years. There is a lot of unfilled demand as can be judged from excessive rush at the existing dry clean setups. positioned against competitors. The business is service-oriented and carries large potential for profits due to its unique nature and uncontrolled spending of people.1 Project Brief The proposed project entails setting up a dry cleaning unit. and there is a need for better service oriented dry clean units. blankets. 2008/Rev2 5 . Jackets. people normally wear worm clothes that are sweaters. It provides a range of services relating to domestic and commercial sector. it is advisable to evaluate the associated risk factors by taking into consideration certain key elements. There should be advertisement on local cable and banners. Reasonable and competitive charges. and it is also season of weddings. PREF-78/ March. 4. PROJECT PROFILE 4. past experience and specific managerial and technical skill set. 4.Pre-Feasibility Study Laundry & Dry Cleaning 3. Technical and efficient labor. Now days. jackets. Due to these activities and wearing pattern the demand for dry cleaning increases compared to other seasons. In winter season. academic knowledge. On time delivery of clothes can leave good impression on the customers. Existing dry cleaners are not advertising for their services. with low quality services. Sherwanis and other sensitive clothes. These may include availability of resources. people are more conscious about their clothes and the need for dry cleaning has increased. drying and pressing to more complex services like cleaning sensitive fabric. 4. Following are some of the key success factors for a Laundry and Dry Cleaning business:       There should be warranty of clothes from damages and any type of color fading. especially on marriages. In Pakistan dry clean industry has grown over the years in small set-ups.2 Opportunity Rationale There is an important factor for the entrepreneurs to set up a dry cleaning business in big cities of Pakistan due to the fact that it has become difficult for the people to wash all types of clothes in their houses i. CRUCIAL FACTORS & STEPS IN DECISION MAKING FOR INVESTMENT Before making any investment decision.3 Market Entry Timing The suitable timings for starting this business would be in October because this type of business has a busy schedule in winters. Prime business location for proposed dry cleaning.

00 22. 0.5 Project Capacity and Rationale The proposed dry clean will handle 60 kg of clothes per bath.4 Proposed Business Legal Status There are three main forms of business: Sole Proprietorship. 4.00 18.00 0.00 28.05 25. Details of the project capacity are as follow: Table 4-1: Project Capacity Project Working hours per day Operating shift per day Working days per annum Maximum clothes dry clean per day Maximum weight of clothes per day Maximum weight of clothes per batch Hours utilized per batch (Laundry & Dry cleaning) 4. please refer to the website: www.Pre-Feasibility Study Laundry & Dry Cleaning 4. Although selection totally depends upon the choice of the entrepreneur but this financial feasibility is based on a private limited company.00 30.00 10.758 million.5 hours Trousers Coats (all Kinds)(winter) Shirts Jackets/sweater Dupata Shalwar Qameez Blankets PREF-78/ March.18 60. Partnership and Company.6 Project Investment Total project cost of the proposed laundry and dry cleaning unit is Rs.saarcnet.25 10.org/newsaarcnet/govtpolicies/Pakistan/settingbusiness. 3.00 1.603 million.html It is recommended that the proposed project be started as a sole proprietorship or a partnership because it requires less legal requirement.75 0.50 Dry Cleaning 8 hours 1 300 days 395 units of clothes 320 Kg 60Kg 1. An enterprise can be a proprietorship or a partnership and even it can be registered under company law with corporate law authority. 4.25 15.845 million and a working capital of Rs. For getting information on the formation of type of firm/company.00 33. 4.35 80. This includes a fixed cost of Rs.00 15.25 0. 2008/Rev2 6 .80 2. Similarly a lower income tax rate of tax is applicable to sole proprietorship than that of companies.00 2.45 40.00 2.7 Proposed Product Mix Following is the product mix of the proposed laundry & dry cleaning shop: Table 4-2: Proposed Product Mix Average Weight Average Number Average Weight per unit (kg) of units per day per day (kg) 0.

000 0 4.Pre-Feasibility Study Laundry & Dry Cleaning Bed sheets 0.000 4.500 4.500 7.630 Summer 6.500 1.500 26.1 Sector Characteristics The numbers of Dry Cleaners in Pakistan has increased at a slow pace over the last few years. The size of this sector is still growing.500 4. They are currently four to five large-scale dry cleaners in Lahore such as Pearl dry cleaners at Barkat Market and PREF-78/ March.) 2.500 12.25 Million 2.000 Description Trousers Coats (all Kinds)(winter) Shirts Jackets/sweater Dupta Shalwar Qameez Blankets Bed sheets Curtain Others(avg.) Total 6.500 4.00 Total 11.500 18.000 0 6.000 750 4.000 750 3.000 0 4. They have a created a monopolized situation with less competition.000 38.00 12.000 24.500 18.603 Million 4. it is suggested that new dry cleaner should be opened up in areas mentioned in table 8-3.38 395.000 3. 5.875 3.875 3. 4.00 320 The proposed business is affected through seasonal variations.000 750 4.25 10.500 0 1.000 4. Following table shows the seasonal distribution of different clothes/ fabric: Table 4-3 Seasonal Variations (100% Capacity) Spring 6.000 0 6.000 4.000 0 6. SECTOR & INDUSTRY ANALYSIS 5.000 750 4.500 26. Therefore. where there is little presence of existing dry cleaning facilities.500 0 1.72 years Project Cost Rs.000 4.00 135.50% Rs.000 0 4.875 3. 5. Defence and Main Market Gulberg. There are few large dry cleaners operating in commercial areas of Lahore like Mall Road.630 118.000 3.00 28.35 80.8 Recommended Project Parameters Capacity 320 kgs per day Human Resource 9 Technology/Machinery Location Local Manufacturing See Table 8-3 Machinery Financial Summary IRR NPV Payback Period 43.630 Winter 6.630 Autumn 6. 2008/Rev2 7 .00 Curtain 1.50 Others(avg.9 Proposed Location Large public sector dry cleaners are concentrated in major cities of the country.000 Total 24.875 3.25 60.500 0 1.500 26.

MARKET INFORMATION 6. This growth rate has increased the demand for various products and services. and one of the services is the proposed business. film industry and hospitals. 6.2 Target Customers The major target market for the dry cleaning services will depend on the location where dry cleaning business is situated.e. These dry cleaners are using machines of 60kg capacity in general. few large Dry cleaners have also been operating in prime business locations in Rawalpindi.Pre-Feasibility Study Laundry & Dry Cleaning Mall Road. Similarly. PREF-78/ March. People in big cities are now inclined to use more sophisticated measures to cleaning their clothes. 2008/Rev2 8 . British Kwick dry cleaners at Mall Road. National dry cleaners at Wahdat Road and Faisal Town and PC dry cleaners. The target customers for proposed business will not only be general public but also the commercial sector i. These people range from middle class to upper class. 6. Karachi and Quetta. Multan. hostels.1 Market Potential From 1981 to 2008 the estimated population of Pakistan has grown from 85 million to 165 million making Pakistan the seventh most populous country in the world. catering companies.

then pressed and shaped. PRODUCTION PROCESS 7.Pre-Feasibility Study Laundry & Dry Cleaning 7. the clothes are then manually transferred to a dryer (laundry procedure). Once clean. The machine then agitates clothes in a manner similar to a domestic washing machine to remove dirt. 2008/Rev2 9 .1 Production Process Flow Liquid solvent and small amount of water are added to the machine. oil. and stains. Tagging Sorting Detergent Washing soap (Simple) Washing Bleach on white Perclon cleaning Dry Cleaning Drying Steam Pressing Sorting & Pressing PREF-78/ March.

b) Sorting: . 2008/Rev2 10 . 7.In this process both the clothes either washed or dry cleaned are pressed and shaped using steam press equipments. Perclon (Perchloroethylene) is a clear.689.) 1.000 178.3 Revenues The proposed product mix has been given in table 4-2. is the dominant chemical solvent used in dry cleaning. 50% kerosene oil and 10% liquid used to save the color fading of clothes. e) Drying :.) Total sale (Rs.) PREF-78/ March. d) Dry Cleaning: . the clothes are properly hanged and covered in the plastic wrap and then tagged so that it can be easily identified. This procedure is used for identification of clothes once ready for collection by the customers.After tagging the clothes are arranged in different sets. Others sort by fabric type c) Washing: .000 1.The clothes are firstly tagged with a specific number. g) Packing :.e.The clothes are washed in a washing machine using detergent i. mentioned in the invoice given to customers.700 110 600 Total Cost Per Annum (Rs.Once pressed.In this process. washing powder etc. washing soap and surf. Perchloroethylene.2 Raw Material Requirement Raw material used for the purpose of dry cleaning of clothes is Perclon chemical by ICI Pakistan. Sale prices and the number of clothes processed are listed in the table below: Table 7-2 Items Sale Price Number of units per year Rate (Rs.The clothes washed in a laundry procedure are dried using dryers. Perclon (Perchloroethylene) is a liquid chemical that consists of 40% alcohol. Surf.000 Perc Lon Bleach Tar pine Oil Cost of chemicals 7. Detergent is used for simple washing i. colorless liquid and evaporates quickly.e. the sensitive.Pre-Feasibility Study Laundry & Dry Cleaning The above chart shows two processes separately that are laundry and dry cleaning. Some people sort by color. Bleach is also used especially for white clothes. expensive and only dry clean recommended clothes are cleaned.000 31. Following table shows the raw material costing: Table 7-1 Chemicals Raw Material Costing Quantity Required per day (Liter) 20 2 20 Rate per Liter 285 55 30 Total Cost per day 5. This procedure is only followed when laundry service is required by the customers. f) Steam Pressing :. Each process is explained as below: a) Tagging :.898. The chemical used to clean the clothes in this process is called Perclon (see raw material section for details). or perclon.

500 18.5 Machinery Requirement Total number of different machines required for the proposed project is as follows: Table 7-3: Machinery Requirement1 Description Washing Machine 42"*60" (60kg) Hydro Extractor 24*12 (25 kg) Dryer Machine 48*42 (60 kg) Dry Clean Machine 30*18 (10 kg) Steam Press (pangenetic) Form Finisher Recondition Cotton Press 1 No.000 10.000 There are several manufacturers of dry cleaning machines in Pakistan.Tel : 042-5820669.000 24.000 75.000 3.347-262Ammar Block Nashtar Colony.000 4.000 170. it is advisable to acquire locally manufactured machinery rather than the imported machinery.Pre-Feasibility Study Laundry & Dry Cleaning Trousers Coats (all Kinds)(winter) Shirts Jackets/sweater Dupatta Shalwar Qameez Blankets Bed sheets Curtain Others(avg.500 7.786 Washing Lab & research Centre in Nishtar Colony Ferozpur road.500 80 170 40 150 40 75 230 100 170 80 1. Some others are in Bund Road.000 Bismillah Washing Lab.000 350.000 175.&Research Centre.000 18. In Lahore.320.Ferozpur Road Lahore.000 720. there are approximately 5 to 6 manufactures of such machines i.000 175.920.000 Total in Rs.000 765.000 200. the prices of imported machinery are 2 to 3 times higher than local machinery. Qainchi and Model Town. 7. 160. Abdul Waheed at Canal Park Gulberg.000 200.000 1.000 170.000 205.440. These machines can also be imported from the following countries:  Italy  Germany  China  Japan However. there is no major difference between local and imported machinery. Therefore.000 3.000 118. 1 1 1 1 1 1 1 Cost Per Unit in Rs.000 4.000 510.) Total 7.000 900.000 205. Mushtaq Engineering Works at Township.000 675.400.000 300.000 75.000 350. Mob:0300-4251156 PREF-78/ March.500 12. 2008/Rev2 11 .4 Technology and Processes 24. 160. Nirwana (Pvt) Ltd at Gulberg Arcade. In terms of quality of cleaning and capacity.000 2.000 690.e.

000 Routine inspection of machinery is essential for long life of the machinery.500 6.000 60.000 260.000 Table 7-6: Furniture.925.000 96.) 7.6 Total Machine Maintenance No.) 40.200 8. 2(10ft*3ft) 1 1 3 3 1 Cost Per Unit(Rs. PREF-78/ March.000 55.) 22.) 1.000 Total(Rs.850 1.500 8.000 2.000 2.000 5.000 1.000 270.000 5% 1 11 480.200 8.501.000 60.000 260. Collar& Cuff Press Boiler Steam Ironing Vacuums Table Boiler With Compressor Sub Total Tax Others Generator Total Description Spilt unit Telephone sets Fire extinguish Total Description Fan Exhaust fan Water cooler Lighting appliances Total Description Wardrobes Sofa set 2 seater Counter Table Chairs Stole Suzuki Loader Total 7.400 1.000 800 350 650.000 Table 7-5: Other Equipment Requirement No. 1 2 1 1 1 1 270.000 7.000 10.500 10.000 480.) 44. Fixture and vehicle Requirement No.) 40.950 Table 7-4: Customer Dealing Office Equipment Requirement Cost Per Unit(Rs.050 650.000 23.000 7.000 2.Pre-Feasibility Study Laundry & Dry Cleaning Sleeves.000 712.500 6.000 Total(Rs. 4 1 1 1 Cost Per Unit(Rs. One lubricant is used twice in a year before peak season. 2008/Rev2 12 .400 1.100 Total(Rs.500 8.

Considering the spread of new residential area some of the suitable areas are: Table 8-3: Suitable Locations City Lahore       Location Main Road Johar Town PCSIR Canal Area Valencia Wapda Town Punjab Co-operative Society Sabza Zar Area is Sq ft.125 square feet area can be rented for approximately Rs. furniture & fixture and other equipments. The rent cost for the business depends on the area where the business is situated. area should be rented.) 900 6002 2 Construction rate for 11 feet high roof PREF-78/ March.125 square feet area is required. 50.3 Recommended Mode It is suggested that for proposed dry cleaning business. LAND & BUILDING REQUIREMENT 8. Table 8-1 Covered Area Area 22. (Rs. A shop having 1.Pre-Feasibility Study Laundry & Dry Cleaning 8. ft.000 Sections Customer Dealing Office Area Working & Machine Area Total Covered Area Table 8-2 Construction Cost Cost Customer Dealing Office Area Working and Machinery Area Total 8. It is recommended that customer dealing office area should be separate from the machine and working area. 8.) 405. approximately 1. 450 675 Cost per Sq ft.000 per month in commercial areas of large cities of the country.000 810.1 Land Requirement For the recommended machinery.000 405.125 Total Cost (Rs. 8. office.4 Suitable Location The dry cleaner is supposed to be in a location that is easily accessible and has considerable population concentration.2 Covered Area Requirement Following is the covered area requirement split into various sections. 2008/Rev2 13 . Starting the dry cleaning in a rented area would significantly reduce the initial capital cost of the project.50 x 20 27 x 25 Total Area (sq.) 450 675 1.

3. as some of the activities will be in progress simultaneously. 1 month for furnishing and staff appointments. if financing has to be arranged through bank).000 7.. selection of suitable location and renting of building etc. HUMAN RESOURCE REQUIREMENT For the proposed size of dry cleaning. 2.000 Salary Per Annum(Rs. following manpower is required: Table 9-1: HR Requirement Position Supervisor Technical staff (Machine operator) Machine Operator .) 120. 4.000 5. 1.1 Estimated Time For Project Completion 1.000 240.000 5. 20 days for completion of initial formalities.5 month for purchase of machinery and equipments. i. This project can take-off within 2 months.) 10. PREF-78/ March. 2008/Rev2 14 .Helper Semi-skilled Worker Total Required 1 2 2 4 19 Salary Per Month(Rs.e.000 168.000 9.000 648.000 120.Pre-Feasibility Study Laundry & Dry Cleaning Islamabad Karachi Quetta Faisalabad Multan                       Eden City Aabpara Market Super Market Blue Area Karachi Company Gulshan Iqbal Defence Phase 1 to 111 Tariq Road Sadar Federal B Area Cantonment Area Liaqat Bazar Saryab Road Satelite Town Jinnah Road Satelite Town Madina Town Railway Road Peoples Colony(D Ground) Satiana Road Cantonment Area New Multan 9. 1 month for sanction of loan (in case. 5.

000 758. fixture.000 122.501.845. equipment and vehicle Erection and Installation Mark-up during construction Contingencies Total fixed cost Initial working capital Project cost Table 10-2: Financing Plan Description Debt Equity Total % 50 50 Amount (in 000’Rs.000 2.000 4.Pre-Feasibility Study Laundry & Dry Cleaning 10.) 2.000 145. 2008/Rev2 15 .000 4.603. PROJECT COST Table 10-1: Project Cost Description Plant & Machinery (Local) Pre-production expenses Furniture.000 3.000 161.000 PREF-78/ March.) 2.302.000 Total Cost (in 000’Rs.000 791.000 125.603.302.

010 7.987 4.692 9 90 13.381 2.469 4.720 3.843 7.782 498 1.080 52 1.725 57 3.158 2.430 4.120 1.454 1.372 4.786 2.649 5.005 2 55 5.777 7.181 16 PREF-78/ March.246 5 70 8.346 3.946 5.170 2.305 4.666 3.157 2.633 (See Table 9) 278 1.700 167 2.735 59 1. FINANCIAL ANALYSIS 11.007 1.609 7.290 2.384 4.071 58 1.135 1. 2008/Rev2 .954 2.114 3.638 50 (See Table 8) 1.120 5.857 55 1.971 3.221 1.246 3.168 2.333 112 3.005 Operating profit Less: Financial expenses Profit Before Taxation Income Tax Net profit After Taxation 1.004 222 1.874 3.430 7 80 10.652 2.266 6.013 64 1.076 3 60 6.1 Projected Income Statement Rs.772 1.346 6 75 9.860 63 1.555 5.368 9.951 3.355 348 1.668 1.777 2.157 4 65 7.284 1.692 6.076 2.787 65 2.843 10 95 15.579 58 1.681 3.974 9.596 5.168 6.941 4.Pre-Feasibility Study Laundry & Dry Cleaning 11.675 61 1.220 1.305 1.155 5.170 7.(000) YEAR CAPACITY UTILIZATION (%) Sales Less: cost of sales Gross profit Less: operating expenses Administrative (See Table 7a) 1 50 5.033 4.001 2.924 1.010 1.555 8 85 12.533 761 1.510 1.

381 1.570 1.215 72 225 2.422 120 4 307 291 22.942 860 860 79 237 2.345 3.302 1.302 11. 2008/Rev2 .(000) YEAR CAPITAL & RESERVES: Share capital Retained earnings 0 1 2 3 4 5 6 7 8 9 10 2.593 29.007 3.717 14.306 21.302 LOANS AND DEFERRED LIABILITIES: Term Loan 2302 2.575 4 4 2.643 15.515 34.161 7.570 758 758 4.365 922 922 460 43 174 761 1.700 3.963 120 3 252 226 13.925 1.394 4 4 2.302 2.585 464 464 460 48 183 1.432 10.302 15.2 Projected Balance Sheet Rs.345 116 2.692 10.666 120 4 278 255 17.700 29.692 6.933 34.925 - 1.273 31.302 24.635 4.741 Rs.059 7.330 23.438 8.033 2.550 18.919 8.207 19.596 2.291 4.360 23.512 17 PREF-78/ March.092 26.063 6.302 8.945 19.864 12.604 120 300 3 142 123 2.032 8. Tax Payable 4.309 1842 1.564 6.942 120 4 337 326 27.635 2.604 FIXED ASSETS: Fixed Assets 3.473 4 4 2.666 - 66 213 1.171 17.302 - 2.741 120 3 227 203 10.004 2.806 28.990 2.793 11.153 2.485 11.593 1382 1.Pre-Feasibility Study Laundry & Dry Cleaning 11.422 1.098 505 505 87 250 2.384 2.158 1.153 120 3 162 139 3.842 460 37 157 348 1.136 2.963 2.725 120 3 204 186 7.098 120 4 369 354 33.302 29.362 34.095 4 4 460 54 192 1.136 120 3 182 163 5.700 Deffered Cost CURRENT ASSESTS: Securities Advance rent Store & Spares Material Stock A/C Receivable Cash/Bank 145 59 203 1.001 1.038 12.608 4 4 2.725 2.302 4.512 150 150 3.990 87 2.382 460 38 165 498 1.635 58 2.019 4 4 2.666 1.302 19.082 23.302 CURRENT LIABILITIES: Maturity (Term Loan) A/C Payable Accrued Exp.283 8.280 2.215 1.(000) 2.495 14.096 15.302 6.280 29 1.002 6.

777 6.485 13.360 27.055 13.550 22.004 3.666 56 1.132 233 8.3 Projected Cash Flow Statement YEAR SOURCES: Profit before taxation Add: Depreciation Add: Amortization Add: interest OTHER SOURCES: Sponsor contribution as capital Term Loan Increase/(Dec) 2.485 460 1.889 3.388 159 2.221 355 29 112 3.495 17.525 370 7.616 2.c.777 355 8.566 7.919 10.845 SURPLUS (DEFICIT) BALANCE OPENING BALANCE CLOSING 759 759 278 348 688 1.170 355 7.Pre-Feasibility Study Laundry & Dry Cleaning 11.302 2.635 5.168 355 6.360 2.004 460 222 498 (264) 916 1.355 355 29 278 2.355 5.971 3.806 33.381 48 1.495 1.717 254 3.158 40 1.908 7.547 2.709 27.361 3.899 5.895 7.631 2.084 277 3.564 460 112 1.635 460 167 761 44 1.550 2.523 385 6.245 759 2.281 4.715 2.656 5.810 17.314 1.033 65 2.559 1.919 3.365 0 1 2 3 4 5 6 7 8 9 10 APPLICATIONS: Fixed Assets Deffered Cost REPAYMENT OF: Term Loan Financial Expenses Taxes Paid Inc.010 10.515 18 PREF-78/ March.305 355 4.596 60 2.700 145 - - - - - - - 460 57 1.782 355 29 222 2.001 43 1.098 4.475 302 5.302 4.806 2.533 355 29 167 3.Assets 3.109 172 4.668 355 29 57 4.432 1.722 4.017 542 2.384 65 2.446 22.120 355 5.564 7.660 239 4.449 5. 2008/Rev2 .929 3.604 1.

50 50% 95% 5% 10% Annual production capacity (No.Pre-Feasibility Study Laundry & Dry Cleaning 12.33 1.00% 2.00% 5. of installments in a year Amortization (years) Table 12-5 Cost of sales Assumptions Raw Material cost growth rate Wage and salaries growth rate Fringe Benefits Variable Charges growth rate Repair and maintenance (%age of cost of machinery) Repair and maintenance growth rate Insurance of Plant and Machinery Insurance of Vehicle Insurance of Stock Insurance of Stores and Spares Depreciation (straight line method) 19 PREF-78/March. FINANCIAL ASSUMPTIONS Table 12-1 Operating Assumptions 118.00% 10% . of Batches Hours consumed for one batch Table 12-2 Machinery Assumptions Initial year capacity Maximum capacity Annual capacity growth rate Depreciation rate on machinery (Straight Line Method) Table 12-3 Revenue Assumptions Sales prices Sales price growth rate Table 12-4 Financial Assumptions Project life (Years) Debt Equity Interest rate on long term debt Debt tenure (Years) No.50% 3. of units) Operating Shift per day Operating hours per shift Days operational per year No. 2008/Rev2 Industry norms 4-5% 10 50% 50% 10% 5 2 5 5% 5% 5% 5% 1% 5% 4.500 1 8 300 5.

Pre-Feasibility Study Laundry & Dry Cleaning Table 12-6 Operating Assumptions 10% 35% 5% 3% 1% 5% 5% 7 7 30 30 30 Rs.109. 2008/Rev2 .000 6 months Administrative expense growth rate Income Tax (percentage of Net Profit) Table 12-7 Contingency Expense Assumptions Erection and Installation Machinery Furniture and Fixture Pre-operating Expenses Vehicles Table 12-8 Cash Flow Assumptions Accounts Receivable in days Accounts Payable in days Raw Material Inventory (days) Stores and Spares Inventory (days) Salaries and other expenses payable Minimum Cash Required Advance rent 20 PREF-78/March.

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