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Entrepreneur profile

Name: Age: Date of birth: Educational qualification: Professional qualification: Industry type: Industry chosen: Initial investment Main production unit: Target area:

Kuniyorath Hishad 20 21-05-1987 10th passed with 70% mark 12th passed with 70% mark BBA FMCG Rice industry 7 Crore At Cochin We target all Keralites settled worldwide.

Entrepreneur profile

Name: Age: Date of birth: Educational qualification: Professional qualification: Industry type: Industry chosen: Initial investment Main production unit: Target area:

Mr. X ---BBA FMCG Rice industry 7 Crore At Cochin We target all Keralites settled worldwide.

Introduction to SSI
The small-scale industries (SSI) constitute an important segment of the Indian economy in terms of their contribution to the countrys industrial production, exports, employment and creation of an entrepreneurial base. The Government established the Ministry of Small Scale Industries and Agro and Rural Industries (SSI & ARI) in October, 1999 as the nodal Ministry for formulation of policies and Central sector programmes/schemes, their implementation and related co-ordination, to supplement the efforts of the States for promotion and development of these industries in India.

Employment Generation
SSI Sector in India creates largest employment opportunities for the Indian populace, next only to Agriculture. It has been estimated that a lakh rupees of investment in fixed assets in the small-scale sector generates employment for four persons.

According to the SSI Sector survey conducted by the Ministry and National Informatics Centre with the base year of 1987-88, the following interesting observations were made related to employment in the small-scale sector.

Generation of Employment - Industry Group-wise

Food products industry has ranked first in generating employment, providing employment to 4.82 lakh persons (13.1%). The next two industry groups were Non-metallic mineral products with employment of 4.46 lakh persons (12.2%) and Metal products with 3.73 lakh persons (10.2%). In Chemicals & chemical products, Machinery parts and except Electrical parts, Wood

products, Basic Metal Industries, Paper products & printing, Hosiery & garments, Repair services and Rubber & plastic products, the contribution ranged from 9% to 5%, the total contribution by these eight industry groups being 49%. In all other industries the contribution was less than 5%.

Per unit employment

Per unit employment was the highest (20) in units engaged in Beverages, tobacco & tobacco products mainly due to the high employment potential of this industry particularly in Maharashtra, Andhra Pradesh, Rajasthan, Assam and Tamil Nadu. Next came Cotton textile products (17), Non-metallic mineral products (14.1), Basic metal industries (13.6) and Electrical machinery and parts (11.2.) The lowest figure of 2.4 was in Repair services line. Per unit employment was the highest (10) in metropolitan areas and lowest (5) in rural areas. However, in Chemicals & chemical products, Non-metallic mineral products and Basic metal industries per unit employment was higher in rural areas as compared to metropolitan areas/urban areas. In urban areas highest employment per unit was in Beverages, tobacco products (31 persons) followed by Cotton textile products (18), Basic metal industries (13) and Nonmetallic mineral products (12).

State-wise Employment Distribution

Tamil Nadu (14.5%) made the maximum contribution to employment. This was followed by Maharashtra (9.7%), Uttar Pradesh (9.5%) and West Bengal (8.5%) the total share being 27.7%. Gujarat (7.6%), Andhra Pradesh (7.5%), Karnataka (6.7%), and Punjab (5.6%) together accounted for another 27.4%. Per unit employment was high - 17, 16 and 14 respectively - in Nagaland, Sikkim and Dadra & Nagar Haveli. It was 12 in Maharashtra, Tripura and Delhi. Madhya Pradesh had the figure of 2. In all other cases it was around the average of 6.

The small scale industries sector plays a vital role for the growth of the country. It contributes 40% of the gross manufacture to the Indian economy. It has been estimated that a lakh rupees of investment in fixed assets in the small scale sector produces 4.62 lakhs worth of goods or services with an approximate value addition of ten percentage points. The small scale sector has grown rapidly over the years. The growth rates during the various plan periods have been very impressive.

The number of small scale units has increased from an estimated 8.74 lakhs units in the year 1980-81 to an estimated 31.21 lakhs in the year 1999. From the year 1990-91 this sector has exhibited a comparitively lower growth trend (though positive) which continued during the next two years. However, this has to be viewed in the background of the general recession in the economy. The transition period of the process of economic reforms was also affected for some period by adverse factors such as foreign exchange constraints, credit squeeze, demand recession, high interest rates, shortage of raw material etc. When the performance of this sector is viewed against the growth in the manufacturing and the industry sector as a whole, it instills confidence in the resilience of the small scale sector. The estimates of growth for the year 1995-96 have shown an upswing. The growth of SSI

sector has surpassed overall industrial growth from 1991 onwards. The positive trend is likely to strengthen in the coming years. This trend augurs a bright future for the small scale industry.

Export contribution
SSI Sector plays a major role in India's present export performance. 45% - 50% of the Indian Exports is being contributed by SSI Sector. Direct exports from the SSI Sector account for nearly 35% of total exports. The number of small scale units that undertake direct exports would be more than 5000. Besides direct exports, it is estimated that small scale industrial units contribute around 15% to exports indirectly. This takes place through merchant exporters, trading houses and export houses. They may also be in the form of export orders from large units or the production of parts and components for use for finished exportable goods. It would surprise many to know that non-traditional products account for more than 95% of the SSI exports. The exports from SSI sector has been clocking excellent growth rates in this decade. It has been mostly fuelled by the performance of garment, leather and gems and jewellery units from this sector.

The lucrative product groups where the SSI sector dominates in exports, are sports goods, readymade garments, woollen garments and knitwear, plastic products, processed food and leather products.

Reasons for the selection of rice industry

The main reason behind choosing the particular topic is the tremendous growth of rice industry both inside and outside India. The important factors that influence the growth in demand for a major staple, such as rice, are growth in the population, increases in per capita incomes, and the rate of urbanization of the population structure. Only the population factor will be provided a major treatment in this paper, but some remarks need to be put forth regarding the effects of expected increases in per capita incomes and increasing urbanization. For increases in per capita incomes, the demand effect will be felt strongest when the poorer households as the shift from inferior staples to rice realize per capita income increases. For higher income households, further increases in per capita incomes result mainly to a shift from standard to higher quality rice Increasing urbanization, on the other hand, has a negative effect in rice demand as other and more food sources become available with current income.

Increase in demand for rice.

In million metric tons Country 1993 2020 Absolute change(19932020) 35.60 Percentage change 46




To find out the taste and preference of the customer we conducted a survey among 30 people both inside and outside Kerala as we are marketing our product world wide focusing Keralites. We surveyed 20 people who are settled with in Kerala and 10 Keralites who are settled in Bangalore. The tool that we used to conduct the survey was questionnaire. The result of our survey is as shown. 1) The first question was regarding the purchasing habit of customers.

0% Once in a wek Twice in a week Once in a month Once in 6 month


50% 20%

Out of the 30 people surveyed 50% of people buy rice once in a month, 30% of people buy once in a week and 20% buy once in two week.

2) The second question was regarding the aspect for which the customers give more importance.

0% 0%

37% 63%

Price Quality

Out of the 30 people we surveyed 63% people give more preference to quality and only 37% people give more preference to price. 3) The third question was regarding the brand of rice that the customer is currently using.

14 12 10 8 6 4 2 0 Nenmani Nirapara Sadhya Nandhani

Out of the 30 people 14 are using Nirapara rice, 8 are using Nenmani rice, 5 are using Sadhya rice and 3 are using Nandhani rice.

4) The fourth question was why they prefer that particular brand.

20% Low price 40% High quality High quality low price 40%

40% of the people are buying the particular brand due to its high quality, another 40% is buying due to high quality and low price of the particular brand and the remaining 20% is buying due to low price of the particular brand. 5) The fifth question was based on the brand loyalty of the customers.

43% 57%

Yes No

Out of the 30 people we surveyed 57% are brand loyal and 43% are not brand loyal. 6) The sixth question was regarding the kind of shop from which the customers usually purchase rice.

30% 47%

Big shops like big bazaars Margin free shops Retail shops


47% people usually buy rice from retail shops, 30% from big shops like big bazaars retail shops and 23% of people from margin free shops. 7) Seventh question was regarding the factor that influences the customers to buy a particular brand of rice.

20% Past expirience Advertism ent 20% 60% Other factors

60% of the people are influenced to buy a particular brand of rice from their past experience, 20% influenced by advertisement and remaining 20% are influenced by other factors.

4Ps of marketing
Product What is it that you are selling? A good marketing manager will be particularly interested in knowing what "need" addresses? Engineers like to think in terms of what problem does it solve? Engineers would think in terms of its functional specifications and marketing people would think more in terms of its features and benefits. Manufacturing people will be thinking about how to make it and along with the accounting group they will be wondering what it costs to make (or buy). Hopefully, they won't be wondering and will defer instead to rigorous analysis. In any event, the product is the "currency" which ultimately gets exchanged for cash. Denny Doyle, consultant and author (founder of Digital Equipment Canada), always told me that the product is that which you trade for cash. In other words, your customers want your product and you want their cash and all you do in business is trade those two items.

PADDY PEARL rice is available in a wide range of varieties that suit various tastes brown rice and white rice in round-grained and long grained varieties. Besides these, there are specialty rice varieties for the varied traditional users of rice in kitchens all over the world.
Rice being the staple food from breakfast to dinner and dessert, PADDY PEARL range of rice caters to every application of rice in the lives of the people especially of south India.

PADDY PEARL rice is the only rice processed using the nutri-select process which ensures that only the best quality rice with the optimum value of Vitamin B is selected by the Z sortex machine and packed. PADDY PEARL rice comes in neat porous traditional jute-bags that help air circulation that is essential to enhancing shelf life, keeping it fungus free.

The PADDY PEARL rice range

Single Matta Rice Rose Matta Rice Payasam Rice Matta Broken Rice Ponni Rice

Idli Rice Jyothi Rice Jaya Rice Cherumani Rice Vita Rice.

Price What is Price? The answer may not be as obvious as one may think. Price is not just the sticker price or the price invoiced. It goes deeper. For example, what about terms? If you can have 30 days to pay for a purchase or as we often hear on radio commercials for household furniture, "nothing down, no interest, low monthly payments starting next year!", or car dealers offering financing of 2.68% on automobile purchases. A good example of clever pricing was Xerox's decision to "loan" customers the Xerox 914 (the first commercial push-button office copier) and to charge them only $.05 per copy. As a product moves through the distribution channels, e.g. from manufacturer to distributor to dealer to customer, there are prices set along the way. The manufacturer's selling price to the distributor becomes the distributor's cost. Is that "cost" in line with competing products which the distributor might carry instead? Is the cost low enough so that dealers will have enough margin in order to want to carry the product? Obviously, it is important to understand pricing and margins along the distribution path. Ultimately, the price to the consumer or last purchaser in the chain must be such that it is competitive. Who sets this price? Does the manufacturer or the dealer have the final say? Can the manufacturer in any way control the price of his product when it hits the street (i.e. retail level)? Most importantly, can the manufacturer make (or sub-contract) the product for a cost to him which allows him to meet his profit objectives given the retail price target? There are various pricing strategies that you have probably heard about. For example, markup pricing is the setting of a price based on one's cost. This may be appropriate when reselling a product used in providing a service. For example, an auto mechanic may mark up her cost of auto parts by 50%. This may be a simple way for her to determine selling price and from her experience this is in line with what other mechanics are doing.

However, it may be totally inappropriate to set pricing based on cost in the case of a nearcommodity item. It should be noted that if you are constrained by both your pricing and costs, then unless you are a particularly efficient operator, it may not make sense to be in this business. Currency is another important aspect for technology companies to consider. Because the markets for technology based products are usually global, you should price your products in U.S. dollars, the currency used for international trading. You might even consider pricing on an FOB (Free on Board) Destination basis. For example, if I am selling optical encoders to machinery makers in Germany, it might behoove me to price on an FOB Stuttgart basis. This means that the German customer does not have to calculate freight, duty, etc. in order to come up with a true landed cost. When I was selling video terminals in Germany in the 1970's, I priced in Deutschmarks, FOB Frankfurt. This meant that I was taking more risk with respect to currency fluctuations, freight and insurance charges, but by consolidating large volumes to Frankfurt, I was able to greatly reduce air freight expenses thereby offering a competitive price to my distributors. There are many business and marketing theories on pricing. It is not possible to do justice to this interesting and complex topic herein. The important thing to remember is that this, perhaps next to the product itself, is one of the most important P's of marketing. And you set it. Product price is in par with the market competition. The latest technology of sortex is being used in the production, sortex machine consumes high power and hence increasing the cost of the product. Place (i.e. distribution) Placement if the product is crucial. There are often many paths (i.e. channels) which a product can take in going from your shop to the customer. A channel "map" can be drawn in order to visualize this keeping in mind all the middlemen, agents, shops, stores, etc. along the way. Defining a channel strategy is not simply an arbitrary matter. Bear in mind that all middlemen along the way are, in essence, in partnership with you to sell something to the end-user. Therefore, your product and its other 3 P's must be such that various resellers in your channel have their needs (e.g. margin objectives, volumes) met. A choice of channels may also be dictated by cost constraints. If it is considered too expensive and risky to advertise and promote a new product in an established market, it may make more sense to go the Lanier route in which case your partner will absorb the up-front sales expenses allowing you to concentrate more on product development. At the risk of oversimplifying, a good practical way to determine, or at least analyze, appropriate channels for your product would be to start at the point of final purchase. Who is the final consumer or user of your product? Where does that person look when buying your type of product? If she buys this product from an office products retail store,

then where does that retailer obtain his products... and so on. Once the various channels have been identified, it is easier to determine which ones make the most sense or which ones offer the path of least resistance. The choice of channels may also have a significant bearing on pricing. For example, in the AES/Lanier case, it was possible for AES to offer very attractive pricing to Lanier because Lanier was absorbing the promotional and distribution costs. This gave Lanier an incentive to focus on sales and marketing and not compete with AES by also manufacturing such machines. Product is to be launched in the kerala market and also to be exported to all around the world targeting mainly keralites. Promotion Promotion is that term which many people confuse with the word "marketing". For many, the words promoter and marketer are synonymous. But, as we know, promotion is just one of the four P's and a good "marketer" is not just a good promoter but also a good planner and a good listener. Promotion can take many forms: advertising in various media, events, press releases, trade shows, brochures, flyers, and internet sites to name a few. Promotion means to create awareness although awareness is just the beginning. Good promotion compels the buyer to buy. The "need" for the product must be addressed. How does it solve the customer's needs (even needs he doesn't know he has)? Promotion is unlimited. There is virtually no limit on the amount of TV, radio, and newspaper advertising that one can do. When Apple announces the Macintosh in 1984, it used a various "shocking" television advertisement that was aired during the American Super Bowl broadcast. What an audience! What an impact! And then it was followed up with an inundation of print advertising as well as focused trade publications and trade shows. Of course, this also resulted in extensive "free" media coverage because of the news worthiness of this innovation. What works best for a technology company? The following chart may provide some insight with respect to the importance of the various tools which can be used. We have planned to aggressively promote our product, through print Adds and T.V commercial. Our research has shown that more than 70% of the purchasing power of Rice is possessed by women, so we have planned to advertise on T.V serials.

Project cost estimation

Equity: 3, 00, 00,000, Debt: 4, 00,00,000. (Loan from KSIDC (Kerala State Industrial Development Corporation @ 16% interest) Working capital loan: 2, 00, 00,000 from ICICI bank @ 12% interest.

Land (Office and Building): 2.5 acres @ 30,000/cent = 75, 00,000, Machinery: 3, 50, 00,000, Factory and Office building: 1, 50, 00,000, Electrification: 1, 25, 00,000, Raw materials: 2, 00,00,000.

Machine used Bhuler Silky Sortex:

The sortex is the most expensive machine used in manufacturing of rice, it cost around 75, 00,000. It is used to differentiate rice into different qualities and also used to differentiate stones and other particles. Sortex is a computerized machine and it differentiates Rice on the basis of quality by using colour differentiation technique.

Company will be set up in the worlds largest industrial belt. Our company will be located near Cochin.

Manufacturing flow chart:

A variety of key equipments are used in a systematic order as per the international norms. The key Equipments used for the processing are Automatic flow balance, Paddy Classifier Hi-power Electro-Magnetic, Separator, Destoner, Cyclone Separator, Dehusker, Separator Drum Grader, Top Whitener, Aspiration Channels Silky Polisher, Indent Cylinder Programmable Logic Controllers, Storage Bins, Automatic Weighing Machines and Packaging Equipment.

Processing Steps Step 1: Automatic flow balancer

Used for the gravimetric proportioning of the free flowing product from a choke product stream. The balancing of the gravimetric flow rate will be attained regardless of the specific gravity or difference in the moisture content of the product.

Step 2: Paddy Classifier

This is for removing large, small and light impurities.

Step3: High power Electro-magnetic Separator

It is used to remove metallic impurities including nails, wires, screws, iron powders, etc. The stock stream is distributed evenly over the entire width of the apparatus, using flap and flows over a permanent magnet on to which the metallic particles cling.

Step 4: Destoner
This facilitates the continuous separation of stones from the paddy stream. The property used here is the disparity in the terminal velocity of the materials and the heavier impurities like stones, metals and glass pieces.

Step 5: Cyclone separator

The cyclone separator is a centrifugal one and the dust particles are carried outwards. The dust settles down and is conveyed through an air lock valve. The gas changes the direction of flow above the air lock now virtually free from dust. The air-locks ensure a dust free atmosphere in the plant.

Man power planning

Managing Director: Managing director will be given a monthly salary of Rs: 50,000. Executive Director: Executive director will be given a monthly salary of Rs: 50,000. General Manager: General Manager will be given a monthly salary of Rs: 20,000 Production Manager: 10,000 Production Manager will be given a monthly salary of Rs: 10,000 Export Manager: 10,000 Export Manager will be given a monthly salary of Rs: 10,000 Accounts Manager: 8,00,000 Accounts Manager will be given a monthly salary of Rs: 8,00,000

Plant Supervisor: 5,000. Plant Supervisor will be given a monthly salary of Rs: 5,000, One supervisor each in two shifts. (4)Operators: 5,000 Operators will be given a monthly salary of Rs: 5,000 (4)Helpers: 3,500 Helpers will be given a monthly salary of Rs: 3,500 (4)Packing Staffs: 3,500 Packing Staffs will be given a monthly salary of Rs: 3,500 Loaders and unloaders: Piece rate system will be followed in the payment to loaders and un loaders.

Human resource policies

40 workers are divided into two shifts, 20 workers in each shift. 1st shift is from 8 am-8pm. 2nd shift from 8 pm 8 am. One supervisor each in two shifts. Weekly one holiday + 13 Public holidays will be given to the employees. 30 minutes tea break will be given to all employees at 9 a.m. All employees will be given lunch break from 12.30- 1.30. During evening also 30 minutes tea break will be given from 4- 4.30 p.m. Similarly night shift employees are also given rest time.

Leave policies
Our company will give holidays to all employees on Sundays and all public holidays. Leave will be given to all employees if there is a valid reason. All the employees will be given 10 casual leaves (leave with pay) and 10 medical leaves. The employees who are going to take casual leave must get prior permission from H.R manager. The employees must give a leave application in writing to the H.R manager stating the reason for leave. If H.R manager thinks that there is a valid reason for taking leave he will give permission to take leave. This will also help the H.R manager to equally divide the workload among other employees. The employees who take medical leave must also give a statement in writing to the H.R manager along with the medical certificate.

Training policies
Our company believes that the product quality can be maintained only with the help of trained employees. Various unwanted wastes can be avoided if proper training is given to the employees. So all the employees are trained before they are appointed for actual job.

All the technical staffs who are working with various machines are given on the job training. On the job training will help those employees to become familiar with the work place and companies work environment. All the managers will be given training from IRRI after one year of their appointment. Need for training. The International Rice Research Institute (IRRI) is the world's leading rice research and training center. Based in the Philippines and with offices in 10 other Asian countries, it is an autonomous, nonprofit institution focused on improving the well-being of present and future generations of rice farmers and consumers, particularly those with low incomes, while preserving natural resources. IRRI is one of 15 centers funded through the Consultative Group on International Agricultural Research (CGIAR), an association of public and private donor agencies. All the non-technical staffs, who are in marketing, finance and H.R department will be given vestibule training, where actual working conditions are stimulated in a classroom. Materials, files and equipment, which are used in actual job, are also used in this training. Training will be given to all employees once in a year. They will also be educated regarding various changes happening in the rice industry around them. Well-qualified professionals will give training.

No employees will be terminated. But if he/she is found involved in any fraudulent activity or misconduct towards the management or to the customers his service will be immediately terminated; Employees are expected to be sincere towards their work. All the employees who are production, packing and packaging department are given uniforms by the company, which they have to wear during work time. The people who are in marketing department are expected to behave well to the customers because they are the persons who take company to the outer world. If there is any misconduct from the part of marketing personnel's, the company has right to take action against them.