Business Plan on;

READYMADE GARMENTS MANUFACTURING
By; Sheikh Mohd Yasir yasirsheikh99@gmail.com

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.

This project report is prepared for the manufacture of gents shirts, gents trousers as they find wide acceptance in local and international markets.

MARKET POTENTIAL

The demand for Readymade Garments is increasing at around 18-20 % annually in the country.

The domestic market and the export market are growing rapidly

Process of Manufacture

Cutting and Sewing
Labeling Packing Finishing and Packing Quality Control and Standards

Our Vision

To become a globally prominent readymade garment manufacturer and be ranked amongst the top garment manufacturers in the country in terms of quality, service standards and ultimately customer satisfaction.

FINANCING

Promoters Contribution Seed Capital lacks Bank Loan

0.15 lacks 3.00

5.85 lacks

PROJECT COST SUMMARY
S.NO 1 2 3 4 5 6 PARTICULARS AMOUNT(LACS) NIL NIL 1.86 1.10 0.50 5.54 9.00 MEANS OF FINANCE 1 Seed Capital (Maximum for this Category) 3.00

Land
Civil Works Plant & Machinery Miscellaneous Fixed Assets Preliminary & Preoperative expenses Working Capital

2
3 A 1 2 B 1 2

Promoters Contribution
Loan from Bank Long Term Investment Seed Money Term Loan From Bank Working Capital Requirement Seed Money Working Capital Finance From Bank

0.15
5.85 3.46 1.21 2.25 5.54 1.94 3.60

DETAILS OF LOANS

Details of Machinery and Equipments
Sl. Description Nos. Rate Amount

No.
1. Power operated cutting machine 2. Power operated SNLS stitching 8 1

(Rs.)
35,000

(Rs.)
35,000

5,000

40,000

machine
3. Overlock stitching machine with motor and accessories 4. Garment washing machine 15kg capacity 5. Hydro extractor 15 kg. capacity 6. Tumbler dryer 15 kg. capacity 7. 9. Potable steam press Other miscellaneous assets 1 LS 20,000 20,000 20,000 10000 1 25,000 25,000 1 25,000 25,000 1 25,000 25,000 1 6,000 6,000

DETAILS OF PRELIMMINARY & PREOPERATIVE EXPENSES
S.NO PARTICULARS AMOUNT(LACS)

1

Traveling & Conveyance

0.05

2

Printing & Stationary

0.05

3

Professional Charges

0.05

4

Misc. Expenses including fee etc.

0.15

5

Interest during Moratorium Period

0.20

0.50

DETAILS OF MISCELLANEOUS FIXED ASSETS

S.NO PARTICULARS STEEL LOCKER, TABLE, CHAIRS 1 for 12 persons LS

AMOUNT(LACS)

0.50

2

FIRE EXTINGUISHER

4

0.20

3

Electric Fitting and Lighting

0.30

TOTAL

1.10

INSTALLED CAPACITY AND PRODUCTION PROGRAMME
Keeping in view the climatic conditions and other factors prevailing in the valley into consideration, the operational hours shall be assumed as:RAW MATERIAL REQUIREMENT and SALES AT 100% INSTALLED CAPACITY

S.no

particulars

Qnt. Req per item in meters

No. of items produced per day

No. of items produced per annum

Total quantity of material required per annum

Rate per meter

Amount in Rs.

Sale price per piece Rs.

Revenue per annum Rs.

A) 1 B)

LADIES SUITS COTTON CHILDREN SETS COTTON WOOLEN SHIRTS COTTON TERI WOOL

5.00

10

3000

15000

53.00

795000

490

1470000

1 2 C) 1 2

1.5 1.5

12 12

3600 3600

5400 5400

65 125

351000 675000

200 300

720000 1080000

2.25 2.25

10 10

3000 3000

6750 6750

90 130

607500 877500

320

960000

335 MISCELLANEOUS ITEMS MATERIAL, EMBROIDERY, BUTTONS, PACKING, STICKERS, ETC. LINING THREAD, ZIPS 100000

1005000

TOTAL AMOUNT IN RS.

3406000

5235000

SAY IN RS. LACS

34.06

52.35

SALES REALIZATION AND PURCHASES IN PHASED MANNER
YEAR CAPACITY UTILISATION 1ST 2ND SAL/WAG PURCHASE (Lacs) 2.22 2.44

UTILITIES

SALES
(lacs)

50.00 55.00 60.00

17.03
18.73 20.44 22.14 23.84

0.13 0.14 0.16

26.18 28.79 31.41

3RD
4TH 5TH 6TH 7TH

2.66
2.89 3.11 3.33 3.55

65.00 70.00
75.00 80.00 80.00

0.17 0.18
0.20 0.21 0.21

34.03 36.65
39.26 41.88 41.88

25.55 27.25
27.25

8TH

3.55

STATEMENT OF MANPOWER REQUIREMENT & THEIR REMUNERATION

S.No.

PARTICULARS

SALARY PER MONTH Nos.

TOTAL(PA)

1

Manager

5000.00

1

60000.00

2

Skilled Workers (Cutters)

4000.00

1

48000.00

3

Tailors

3000.00

8

288000.00

4

Sales/Marketing Executive

2500.00

1

30000.00

5

Chokidar

1500

1

18000.00

Total

12

444000.00

Say

4.44 Lacs

PAY BACK PERIOD
Pay back period is the length of time in which, the unit recovers its initial investment. It may also be defined as the number of months or years required for the unit to generate commutative gross operating surplus equal to the fixed capital investment in the project. The payback period of the unit is estimated in the following table

.

Year 1st 2nd 3rd 4th 5th 6th 7th 8th 1 year

CFAT 4.90 5.37 5.88 6.44 7.03 6.87 7.40 6.61 +

Cumulative Cash inflow 4.90 10.27 16.15 22.59 29.62 36.49 43.89 50.50 10 Months

Projected Profitability Statement
The annual cost of sales and profitability during the first eight years of operation of the plant is estimated in the following table.

S.no 1 2 3 A: 1 2 3 4 5 6 7 8 B: 1 2 3 4 5 6 7 8 9 10 11 12 C: 1 2 3 4

Particulars Year of operation Capacity Utilization (%) Sales realization Cost of production Raw Material Salary & wages Utilities Repairs & Maintenance Administrative expenses Selling expenses Total Gross profit Financial expenses Interest on term loan Interest on WCL Depreciation (SLM) Total Profit before tax Taxation Profit after tax Withdrawals Profit carried to B/S Cumulative profit Add back depreciation Total cash surplus Less payment Term Loan Withdrawals Total payments Net Cash accruals

Operating Years

1st
50.00 26.18

2nd 55.00 28.79

3rd 60.00 31.41

4th 65.00 34.03

5th 70.00 36.65

6th 75.00 39.26

7th 80.00 41.88

8th 80.00 41.88

17.03 2.22 0.13 0.06 0.26 1.05 20.75 5.43 0.20 0.32 0.35 0.87 4.55 0.00 4.55 0.00 4.55 4.55 0.35 4.90 0.00 0.00 0.00 4.90

18.73 2.44 0.14 0.09 0.29 1.15 22.85 5.95 0.20 0.37 0.35 0.92 5.02 0.00 5.02 0.00 5.02 9.58 0.35 9.93 0.45 0.00 0.45 9.48

20.44 2.66 0.16 0.12 0.31 1.26 24.94 6.47 0.16 0.42 0.35 0.93 5.54 0.00 5.54 0.50 5.04 14.62 0.35 14.96 0.45 0.50 0.95 14.01

22.14 2.89 0.17 0.15 0.34 1.36 27.04 6.98 0.12 0.42 0.35 0.89 6.10 0.00 6.10 0.50 5.60 20.21 0.35 20.56 0.45 0.50 0.95 19.61

23.84 3.11 0.18 0.15 0.37 1.47 29.11 7.53 0.08 0.42 0.35 0.85 6.68 0.00 6.68 0.50 6.18 26.39 0.35 26.74 0.45 0.50 0.95 25.79

25.55 3.33 0.20 0.18 0.39 1.57 31.21 8.05 0.04 0.42 0.35 0.81 7.24 0.72 6.52 1.00 5.52 31.91 0.35 32.26 0.45 1.00 1.45 30.81

27.25 3.55 0.21 0.18 0.42 1.68 33.28 8.60 0.00 0.42 0.35 0.77 7.83 0.78 7.05 1.00 6.05 37.96 0.35 38.31 0.00 1.00 1.00 37.31

27.25 3.55 0.21 0.18 0.42 1.68 33.28 8.60 0.00 0.42 0.35 0.77 7.83 1.57 6.27 1.00 5.27 43.23 0.35 43.58 0.00 1.00 1.00 42.58

PROJECTED BALANCE SHEET
The balance sheet of a unit is a very important feature of the working of the unit. In a healthy unit, there is always a growth in total assets and liabilities every year. In a projected balance sheet on the liabilities side the reserves and surplus and on the assets side the cash and bank balances should show healthy growth.

S.no A: 1

Particulars

Year

1st 0.15 3.00

2nd 0.15 3.00 9.58 1.80 4.14 18.67

3rd 0.15 3.00 14.62 1.35 4.68 23.80

4th 0.15 3.00 20.21 0.90 4.68 28.94

5th 0.15 3.00 26.39 0.45 4.68 34.68

6th 0.15 3.00 31.91 0.00 4.68 39.75

7th 0.15 3.00 37.96 0.00 4.68 45.80

8th 0.15 3.00 43.23 0.00 4.68 51.06

Liabilities Promoters Contribution

2 3 4 5

Share Capital Reserves & Surplus Term Loan 3.60 WCL 13.55 Total Assets 3.46 3.11 0.35 2.77 6.08 9.82 2.77 0.35 2.42 6.62 14.75 2.42 0.35 2.08 6.62 20.24 2.08 0.35 1.73 6.62 26.32 1.73 0.35 1.38 6.62 31.74 1.38 0.35 1.04 6.62 38.14 1.04 0.35 0.69 6.62 43.75 Gross Block 0.35 Depreciation 3.11 Net Block 5.54 Current Assets 4.90 Cash and bank balance 13.55 Total 18.67 23.80 28.94 34.68 39.75 45.80 51.06 4.55 2.25

B: 1 2 3 4

5

Target market
We are going to focus on baby wear, children clothing and youth clothing (both boys and girls).

Market Segmentation
The garments industry can be categorized in many segments, however our target market consists of;  Baby Wear.  Children Clothing.  Youth Clothing (Boys & Girls)

Competitive Strategy

 

To establish a system of recording feedback and complaints of customers in order to meet the need of customers in better way. To provide quality garments at best available price in the market. To provide new policies related to return and exchange of clothes which assists the customers in the event of need for return.

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