Why Paper Bags?

Eco-friendly
increasing awareness of hazards of
plastic
Ban imposed on plastic bags in many
states
Current fashion trend

Executive Summary
Company: Eco Fashion Bags Pvt. Ltd.
Product: Paper bags
Clients: Malls, Departmental stores,
Super
Markets, Gift shops, etc.
No. of Promoters: 11
Contribution of each promoter: 200000
Rs.
Target market: 6 cities of Maharashtra
Projected sales: 7200000 units p.a.

Company Profile
Vision
To become a proactive , integral and
responsible member of our
environment and community, making
us a strong global supply base for
world class products.
Mission
To constantly grow the customers by
designing superior and cost effective
product through contribution of ideas.

Values
Excellence
Integrity
Passion
Teamwork
Commitment

Company
Logo

blue colour of earth Peace,

Purity
and coolness.

green arrows - company is

highly
concerned about
protecting the earth.

Product Profile
Products range:
The bags of six sizes are being manufactured,
Size ranges from;
1824 to 4050.
We can also manufacture bags according to the
customers specifications & requirement.
Product strength:
All our product having good busting strength and
it is between 18- 36 g/inch.
Product quality:
Manufacturing superior quality products.
Purchases reputed supplier.
Product price:
Our price range is between 3 to 10 Rs.

Total Company Risk

Product Market Risk
Customer loss
Product Obsolescence
Competition Increases
Product Demand Decreases
Financial Risk
Capital cost change
Inflation
Default on debt
Exchange rate changes
Legal Risk
Shareholder and Employee discrimination lawsuits

Input risk
Input price increases
Labor strikes
Key employees leave
Supplier fails
Operational Risk
Machinery breakdown
Product defect increases
Inventory Obsolescence
Regulatory Risk
Environmental law change
Price support ends

MARKETING PLAN
EXECUTIVE SUMMARY
Target the big cities of Maharashtra like Mumbai, Pune, Nagpur,
Nasik, Aurangabad and Kolhapur
Current demand of the product in six cities is around
40lakhs/month and is expected to go high
Consumer acceptance and brand recognition are the major
barriers
USP is excellent service, quality products at a reasonable price,
transportation network and sales force capabilities
SWOT
Strength:
Low cost with high quality.
Dedicated & punctual staff.
On time delivery.
Favorable access to distribution networks.
Weaknesses:
Entry.
Inexperience.
High cost structure.
Limited area of operation.
Not able to enjoy economy of scale.
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Opportunities:
Scope of export.
Large market.
Changing of lifestyle/fashion.
Environmental conscious customer.
Threats:
Large number of competitors.
Threats of substitute product.
Highly sensitive & volatile market.
New regulation.
MARKETING STRATEGY
Marketing objective:
important domestic player in terms of market share
backward integration
expand business
Target market:
Our customers would be malls, multiplexes, hypermarkets,
supermarkets, departmental stores, speciality stores, gift shops etc
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Demand forecast:
The Demand of the product
in six cities would be around
40lakhs units/month.
Promotion:
Promotion strategies like;
Discounts
Salesperson incentives
Word of mouth and Friends network
Commission to sale person, credit to customers
catalogs
Contract with the NGOs working on environment friendly projects
like use of paper bags
Travelling and other incentives etc.
Strategies:
market penetration strategy
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Competitors:
A.L paper house, jaipur, Rajasthan.
Delhi paper bag manufacturer, Delhi.
Vishal paper bag company, Mumbai, Maharashtra.
Market research:
Primary data through buyers intention survey
FINANCIAL:
Break even analysis: Break Even Point
will be achieved in 10.6 Months
Sales forecast:
target sales would be around
6 lakhs units/month
CONTROLS:
Marketing organisation:
1 sales manager responsible for
the sale in six cities.

7 salesmen; 3 for Mumbai, 2 for Pune, 1 for Nasik and Nagpur and 1 for
Aurangabad and Kolhapur [first year]
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OPERATION PLAN
A) Plant Location:PATALGANGA MIDC (RAIGAD)
Maharashtra.
Distance from Mumbai is 75 kms.
Distance from Pune is 77 kms.
Size of land= 2000 Sq ft.
Approximate cost of land= Rs 540000
(270 Rs, per
Sq Ft).
Approximate construction
cost= Rs 510000.
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B) Plant Machineries and Equipment:

1) Automatic Paper Bag Manufacturing Machine
Cost of machine = Rs 4,80,000/Production capacity= 30,000 bags per shift (8 hrs).
Utilized capacity = 24,000 bags per shift

2) Automatic Screen Printing Machine

Cost of each machine= Rs 22,000/Production capacity = 12000 bags per shift (8 hrs).

3) Eyelet Machine.
Cost of each machine= Rs 20,000/Production capacity =6000 bags per shift (8 hrs).

4) D-Shape Eyelet Machine.

Cost of machine= Rs18, 000 /Production capacity=
6000 bags per shift (8hrs).
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C) Plant Layout:D) Raw Material Requirement: For producing the paper bags the CRAFT
Paper is used as a raw material.
The required specification is in terms of
Busting Factor and GSM of the paper.
For producing the quality bags the
busting factor of the craft paper should
range between 18 to 36 gm/inch and
the GSM of the paper is between 120 to
400.
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E) Suppliers :1)Premium Paper & Board Industries

Ltd.
2)Rama Pulp & Paper Ltd.
3)Kay Pulp & Paper Mill Ltd.
4)Aerographic Papers Pvt. Ltd.

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Human Resource

Administrative Workforce Name of

position

2009-10

2010-11

2011-12

Finance
manager

Sales manager

Asst.Sales
manager

Salesman

10

12

Clerk

Manufacturing 3
Workforce Guard

No .of
position

2009-10

2010-11

2011-12

Supervisor

Skilled

Unskilled

12

Helper

Various HR related issues Bonus

Attendance
Annual leave with wages
Holidays
Working hours
Safety and health
Benefits
Record maintenance
Motivating our people

Legal aspects.

Approval of nameMemorandum of AssociationArticle of AssociationCertificate of IncorporationTax registration-

Financial
Plan

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Assumptions
Inflation rate may vary between 4%6%.
Sales target will be achieved
according market research and
production capacity.
Capital cost may vary but marginally

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Financial policies

Depreciation -10%
Creditors.
Debtors .
Closing stock.
Short term investment.
Profit margin 6 %.

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Capital
Capital Requirement
Particulars
Amount Rs.
Fixed assets requirement
Working capital requirement
Total
3973000

1702000
2271000

Capital sources
Particulars
Amount Rs.
Promoters contribution
Bank Loan
Total
4000000
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2200000
1800000

Projected Cost Sheet

Amt. in Rs.
Particulars

1st year

Direct cost

2nd year

3rd year

27888000 41886000 66162000

Administrative overheads

1758600

2207180

2704462

Selling overheads

2298600

3067180
4495318

3904462
7006646

30186600

1811196

2697190
4765037

4203987
7427044

31997796

4.45

4.00

4.15

Total Cost
Profit at 6 %
Sales
Selling Price Per Unit

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Projected Trading & P&L A/c

Amt. in Rs.
Particulars
Net sales
Gross Profit
Depreciation

1st year

2nd year

3rd year

31997796

47650371

74270448

4304044

5750696

8521470

120200

157180

141462

37500

37500

1831061

3255906

Indirect Income
Net Profit

1367808

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Projected Balance Sheet

Amt. in Rs.
Particulars

1st year

2nd year

3rd year

Share Capital

2200000

2200000

2200000

Bank Loan

180000

1800000

1800000

Dividend

275000

825000

1100000

Fixed Assets

2821800

2664620

3873158

Current
Liabilities

6227484

6407509

4123651

Current Assets

8564489

9841757

13383268

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Cash Flow Statement

Amt. in Rs.
Particulars

2009-10

2010-11

2011-12

Total Inflow

40210839

74515952

109500464

Total Outflow

40190075

74453852

109473387

Net Inflow

20764

62100

29900

Discounted cash flow

Amt. in Rs.
Particulars
Statement
Amount Rs.
Total Discounted Cash Inflow
Discounted Cash out flow
Net Present Value

40162089
4490860
35671229

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Ratio Analysis
Particulars
Current Ratio
Quick Ratio
Debt Equity
Ratio
Gross Profit
Ratio
Net Profit Ratio
Working Capital
TOR
Inventory TOR

2009-10

2010-11

2011-12

1.36 :

1.65 :

1.56 :

1
0.78 :

1
1.09 :

1
1.08 :

1
0.60 :

1
0.52 :

1
0.37 :

1
13.45

1
12.07

1
11.47

%
4.27

%
3.84

%
4.38

%
14.09

%
11.53

%
14.62

8.86

13.32

16.92

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Break Even Analysis

BEP In Units

= 64,16,140 (units)

BEP IN RUPEES = 2,84,87,662 (Rs.)

Break Even Point will be achieved in
10.6 Months

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Thank You
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