Pre-Feasibility Study

(Injection Moulding Plastic Products)

Small and Medium Enterprises Development Authority Ministry of Industries & Production
Government of Pakistan
www.smeda.org.pk
HEAD OFFICE
4th Floor, Building No. 3, Aiwan-e-Iqbal Complex, Egerton Road, Lahore Tel: (92 42) 111 111 456, Fax: (92 42) 36304926-7

helpdesk@smeda.org.pk
REGIONAL OFFICE Punjab 3rd Floor, Building No. 3, Aiwan-e-Iqbal Complex, Egerton Road Lahore, Tel: (042) 111-111-456 Fax: (042) 36304926-7 helpdesk.punjab@smeda.org.pk REGIONAL OFFICE Sindh 5TH Floor, Bahria Complex II, M.T. Khan Road, Karachi. Tel: (021) 111-111-456 Fax: (021) 35610572 helpdesk-khi@smeda.org.pk REGIONAL OFFICE Khyber Pakhtunkhwa Ground Floor State Life Building The Mall, Peshawar. Tel: (091) 111-111-456 Fax: (091) 5286908 helpdesk-pew@smeda.org.pk REGIONAL OFFICE Balochistan Bungalow No. 15-A Chaman Housing Scheme Airport Road, Quetta. Tel: (081) 2831623, 2831702 Fax: (081) 2831922 helpdesk-qta@smeda.org.pk

Note: All SMEDA Services / information related to PM's Youth Business Loan are Free of Cost December, 2013

Pre-Feasibility Study

Injection Molding Plastic Products

Table of Contents
1. DISCLAIMER ............................................................................................................................... 2 2. PURPOSE OF THE DOCUMENT ................................................................................................ 3 3. INTRODUCTION TO SMEDA ...................................................................................................... 3 4. INTRODUCTION TO SCHEME ................................................................................................... 4 5. EXECUTIVE SUMMARY ............................................................................................................. 4 6. BRIEF DESCRIPTION OF PROJECT AND PRODUCT ............................................................. 5 7. CRITICAL FACTORS .................................................................................................................. 6 8. INSTALLED AND OPERATIONAL CAPACITIES ...................................................................... 6 9. GEOGRAPHICAL POTENTIAL FOR INVESTMENT.................................................................. 6 10. 11. 12. 12.1 12.2 12.3 12.4 12.5 12.6 12.7 12.8 12.9 12.10 13. 14. 14.1 14.2 14.3 14.4 14.5 15. POTENTIAL TARGET MARKETS / CITIES .......................................................................... 6 PRODUCTION PROCESS FLOW ......................................................................................... 7 PROJECT COST SUMMARY ................................................................................................ 7 PROJECT ECONOMICS ...................................................................................................... 7 PROJECT FINANCING ........................................................................................................ 8 PROJECT COST ................................................................................................................ 8 SPACE REQUIREMENT ...................................................................................................... 8 MACHINERY AND EQUIPMENT ............................................................................................ 9 FURNITURE AND FIXTURES .............................................................................................. 10 RAW MATERIAL REQUIREMENTS ...................................................................................... 10 HUMAN RESOURCE REQUIREMENT .................................................................................. 11 REVENUE GENERATION .................................................................................................. 11 OTHER COSTS ............................................................................................................... 12 CONTACTS - SUPPLIERS, EXPERTS/CONSULTANTS ................................................... 14 ANNEXURE.......................................................................................................................... 15 ANNEXURE 1 - INCOME STATEMENT ................................................................................. 15 ANNEXURE 2 – STATEMENT OF CASH FLOW ..................................................................... 16 ANNEXURE 3 – BALANCE SHEET...................................................................................... 17 USEFUL PROJECT MANAGEMENT TIPS ............................................................................. 18 USEFUL LINKS ................................................................................................................ 19 KEY ASSUMPTIONS ........................................................................................................... 20

Although.pk SMEDA Services / Information related to PM’s Youth Business Loan are FREE OF COST - 2 . For more information on services offered by SMEDA.1. due care and diligence has been exercised to compile this document. The information has been provided on “as is where is” basis without any warranties or assertions as to the correctness or soundness thereof. The contained information does not preclude any further professional advice. the contained information may vary due to any change in any of the concerned factors.smeda. however. The prospective user of this memorandum is encouraged to carry out additional diligence and gather any information which is necessary for making an informed decision including taking professional advice from a qualified consultant / technical expert before taking any decision to act upon the information. SMEDA. it is based upon certain assumptions which may differ from case to case.org. Although. and the actual results may differ substantially from the presented information. DISCLAIMER This information memorandum is to introduce the subject matter and provide a general idea and information on the subject. please contact our website: www. its employees or agents do not assume any liability for any financial or other loss resulting from this memorandum in consequence of undertaking this activity. the material included in this document is based on data / information gathered from various reliable sources.

marketing. With a mission "to assist in employment generation and value addition to the national income. INTRODUCTION TO SMEDA The Small and Medium Enterprises Development Authority (SMEDA) was established in October 1998 with an objective to provide fresh impetus to the economy through development of Small and Medium Enterprises (SMEs). through development of the SME sector. Concurrent to the prefeasibility studies. best practices developed by existing enterprises by trial and error. finance and business management. institutional collaboration and networking initiatives. a broad spectrum of business development services is also offered to the SMEs by SMEDA. Apart from carefully studying the whole document one must consider critical aspects provided later on. start-up. Preparation and dissemination of prefeasibility studies in key areas of investment has been a hallmark of SME facilitation by SMEDA. The purpose of this document is to facilitate potential investors in Injection Molding Plastic Products business by providing them with a general understanding of the business with the intention of supporting potential investors in crucial investment decisions. PURPOSE OF THE DOCUMENT The objective of the pre-feasibility study is primarily to facilitate potential entrepreneurs in project identification for investment. The need to come up with pre-feasibility reports for undocumented or minimally documented sectors attains greater imminence as the research that precedes such reports reveal certain thumb rules. The project pre-feasibility may form the basis of an important investment decision and in order to serve this objective. access to finance. SMEDA has carried out ‘sectoral research’ to identify policy. These services include identification of experts and consultants and delivery of need based capacity building programs of different types in addition to business guidance through help desk services. by helping increase the number. production. scale and competitiveness of SMEs" . and certain industrial norms that become a guiding source regarding various aspects of business set-up and it’s successful management. the document / study covers various aspects of project concept development.2. SMEDA Services / Information related to PM’s Youth Business Loan are FREE OF COST - 3 . 3. strategic initiatives. business development services. which form the basis of any investment decision.

Selection of appropriate plant and equipment / molds 2. All industrial zones in cities like Karachi. Given the cost assumptions IRR and payback are 49% and 2. for young entrepreneurs. Sindh. Peshawar etc. 0.0 Billion for the year 2013-14.760 containers operating at 80% capacity.1 million to Rs. with an allocated budget of Rs.0 million with tenure up to 8 years inclusive of 1 year grace period and a debt : equity of 90 : 10 will be disbursed to SME beneficiaries across Pakistan. The injection molding setup would have an installed capacity to manufacture 187. Hyderabad. Multan. Lasbela. Quetta. Gilgit Baltistan. Relevant Management Experience 3. through designated financial institutions. Total cost estimates are Rs.PP plastic in a contract manufacturing mode. Lahore. Linkages SMEDA Services / Information related to PM’s Youth Business Loan are FREE OF COST 4 .25 years respectively. Power / Energy Mix 4. infrastructure and other provisions essential for the production process are conveniently available. the plant is estimated to manufacture 149. 1. is designed to provide subsidised financing at 8% mark-up per annum for one hundred thousand (100. 0. Marketing Efficiency 5. INTRODUCTION TO SCHEME ‘Prime Minister’s Youth Business Loan’ Scheme. are suitable locations to setup the project. EXECUTIVE SUMMARY The Injection Molding Plastic Products Unit is proposed to be established as a contract manufacturing facility at a location where utilities especially electricity. 12 personnel would be required to manage the operations of the plastic injection molding setup. initially through National Bank of Pakistan (NBP) and First Women Bank Ltd. Punjab. (FWBL). 5. 2.34 million.200 units of 500 grams plastic containers. covering.000) beneficiaries. Rawalpindi. Azad Jammu & Kashmir and Federally Administered Tribal Areas (FATA). The most critical considerations or factors for success of the project are 1. Balochistan. Khyber Pakhtunkhwah.84 million and an initial working capital requirement of Rs. However. Loans from Rs.4. 2.18 million with a fixed investment of Rs. Gujranwala. The proposed project is assumed to manufacture plastic containers using injection grade HDPE / Co . 5.

PP plastic in a contract manufacturing mode operating 20 hours a day. There are many different types of plastic. Hyderabad. plastic bags to items of engineering excellence like cars and airplanes. containers. Gujranwala. Gujranwala.000 plastic manufacturers in the Pakistan and 600.6. Sialkot. the per capita plastic consumption works out to be around 24 kg per annum. Rawalpindi and Peshawar etc. Location: The unit is proposed to be established as a manufacturing facility at a location where utilities. however. The per capita consumption of plastic in Pakistan is 3. Product: The project is assumed to manufacture food grade and other plastic containers using injection grade HDPE / Co . Rawalpindi. Globally.1 kg. 312 days a year. while it is 3. and the type of modifying compounds added.000 people are directly or indirectly engaged in this business. Gujrat. Hyderabad. • Technology: The proposed facility is to be setup with used plastic injection molding machine including molds for production of 500 grams plastic containers. The setup would have an installed capacity to manufacture 187.200 units of 500 grams plastic containers per annum. The proposed project will provide direct • • • • SMEDA Services / Information related to PM’s Youth Business Loan are FREE OF COST - 5 . There are around 6. depending on the starting monomer selected.3 kg in India and 7 kg in China. are good markets for the product under consideration. Quetta and Peshawar etc. Hub. Faisalabad. Lahore. Hub. water pipes. Multan. buckets. BRIEF DESCRIPTION OF PROJECT AND PRODUCT Plastic is a common name for polymers that are materials made of long strings of carbon and other elements. glasses. Target Market: Karachi. Employment Generation: employment to 12 people. The highest per capita consumption of plastic is in United States and Germany. partnership opportunities may be explored if further investment is required. The varied use of plastic in our everyday life has made it an integral component in almost everything. infrastructure and other provisions essential for the production process are conveniently available such as industrial zones in Karachi. Plastic is used in everyday items like ballpoint pen. Multan. Lahore. where per capita consumption is 120 kg per annum. the length of polymer chains. The injection molding business is assumed to operate as a sole proprietorship.

INSTALLED AND OPERATIONAL CAPACITIES The proposed injection molding plastic products setup is envisaged to be established as a manufacturing facility. Quetta and Peshawar etc. Sales are expected to increase at a rate of 10% annually with the same installed capacity. Hyderabad. Shikarpur. Quetta and Peshawar etc. there is also a growing demand for the product in. which may lead to consistent orders and referrals. SMEDA Services / Information related to PM’s Youth Business Loan are FREE OF COST - 6 . All industrial clusters in Karachi. it is important to find a location preferably in an industrial clusters where utilities especially electricity and other infrastructure are conveniently available. However the plant is estimated to manufacture 149. Multan. Major target market includes food processing and marketing companies. 9.7. Gujranwala.200 units of 500 grams plastic containers per annum.760 containers operating at an 80% capacity. CRITICAL FACTORS The main critical success factors that affect the decision to invest in the proposed business setup are: • • • • • Selection of appropriate plant and equipment / molds Relevant Management Experience Power / Energy Mix Marketing Efficiency Linkages 8. Hub / Lasbela. 10. chemical. are suitable to house the project. Rawalpindi. Lahore. Multan. GEOGRAPHICAL POTENTIAL FOR INVESTMENT For the success of the project. The setup would have an installed capacity to manufacture 187. However. Rawalpindi. Hyderabad. Sukkur. lubricant and pharmaceutical sector stakeholders based in Karachi and Lahore. Gujranwala. POTENTIAL TARGET MARKETS / CITIES The plastic and packaging sectors are growing industrial segments in Pakistan relying heavily on the changing lifestyle patterns and population growth in the country. Establishing the unit in large cities would have an advantage of being close to large buyers.

Project Economics Description Internal Rate of Return (IRR) Payback Period (yrs) Net Present Value (NPV) Details 49% 2 . PROJECT COST SUMMARY A detailed financial model has been developed to analyze the commercial viability of this project under the ‘Prime Minister’s Youth Business Loan’ Scheme. Pigment Machine setup Satisfactory Prototype Yes Commence Production Run Order count completed Yes Delivery No No Rework 12. Cash Flow Statement and Balance Sheet are attached as appendices.1 Project Economics The following table shows internal rate of return.25 Rs 4. 12. Various costs and revenue related assumptions along with results of the analysis are outlined in this section.11. PRODUCTION PROCESS FLOW The production process diagram of the proposed injection molding plastic products setup is as follows. Injection Molding Process Flow Trial Run preparation  Contract Material Supplier   Molds Resin. Table 1 .191 SMEDA Services / Information related to PM’s Youth Business Loan are FREE OF COST - 7 . payback period and NPV for injection molding plastic products project operating at 80% of capacity in its first year of operations. The projected Income Statement.683.

3 Project Cost Following requirements have been identified for operations of the proposed business.000 1.840.Project Financing Description Total Equity (10%) Bank Loan (90 %. 12.800 2.800 50.050 sq feet in an industrial area where all utilities and facilities are properly available. The recommended space is proposed to be totally SMEDA Services / Information related to PM’s Youth Business Loan are FREE OF COST - 8 .600 12. marketing efficiency and quality of molds. Table 2 .4 Space Requirement The land requirement is around 2.760 Rs.000 1.000 196. 217.) 205.000 189. Table 3: Capital Investment for the Project Capital Investment Renovation Cost Furniture &Fixtures Machinery & Equipment Advance Rent and Security Deposit Preliminary Expenses Total Capital Cost Initial Working Capital Total Project Cost Amount (Rs. The plot will easily allow the accommodation of the recommended machines.800 336.2 Project Financing Following table provides details of the equity required and variables related to bank loan.200.Returns on the project and its profitability are highly dependent on the power mix. relevant management experience.177.840 8% 8 1 12.) Markup to the Borrower (%age/annum) Tenure of the Loan (Years) Grace Period (Years) Details Rs.959.1.

000 Production Hall Office and tool shop Warehouse Total Area The proposed premises would be acquired on a rental basis with 3 months deposit and 3 months advance rent after which rent will be payable on monthly basis. The allocation of space would be as follows: Table 4: Space Requirement Space Requirement (in ft.000/.000 60.000 Total Cost of Machinery The injection molding machine is available in Pakistan with local suppliers dealing in used / refurbished machinery.000 Total Rs. 12. 16/ Sq. 32. since the life of this machinery is very long (15 to 20 years) many people prefer using used machinery which requires a SMEDA Services / Information related to PM’s Youth Business Loan are FREE OF COST - 9 .200.000 25.050 Sq Ft.) 1. 205. 900.) The premises renovation and customization costs of Rs.050 Cost of Renovation Amount (Rs.5 Machinery and Equipment The typical injection molding plastic products setup would require the following machinery and molds for its operations: Table 5: List of Machinery and Equipment Description Used Injection Molding Machine (Year 1990-1996) Used Molds (plastic container 500gms) Quantity 1 Cost Rs/unit 900.000 300.000 1.would be depreciated at the rate of 10% per annum using diminishing balance method.000 205.) 120.800 per month for the proposed injection molding setup (2. However. around 12% for office and tool shop and rest 58% to be utilized for production.200 250 600 2. feet amounting to Rs.) Area (Sqft. The monthly rent is estimated at approximately Rs.covered with 30% space for warehouse.

000 2.000 14. A used analog injection molding machine of Triad origin is proposed for this setup. Some molds are locally made but people generally prefer Chinese molds that are usually robust and refined. 12.000 25.000 60. Super Jet. decreasing margins at retail level.000 is required for purchase of office furniture. Horizon. The molds are very costly and need to be carefully picked.regular maintenance but the capital investment is significantly lower than new machines. The following table gives an estimated breakup: Table 6: Furniture and Fixtures Costs Description Table & Chair Set (Owner) Table & Chair Set (Customer Service) Table & Chair Set (Office Staff) Air Conditioner (Split Unit) Waiting Chairs Sofa Set for Customers Curtains / Interior Décor Total Quantity Cost/Unit (Rs. Used molds to manufacture 500 grams plastic bucket are proposed for this setup. These machines usually come in two technological formats 1) Computerized 2) Analog The most common brands for injection molding machinery are Jet Master. toll manufacturing or contract manufacturing mode is proposed for the injection molding project. Mitsubishi.000 189. Sintesi etc.000 20.000 28.6 Furniture and Fixtures A total of Rs 189. prevailing credit in the market (2-3 months) and limited investment.000 14. European or American machinery is preferred by manufacturers and buyers. Engel.000 60. BM Biraghi. Used molds are relatively cheap and able to deliver the desired quality for local buyers.) 17.) 17.500 20. Chinese machines are also available but Japanese. fixture and related equipment. 12.000 25. if the manufacturer is in possession of a rare or SMEDA Services / Information related to PM’s Youth Business Loan are FREE OF COST 10 . The margins tend to be above average.000 1 1 2 1 10 1 The Office Furniture & Equipment costs are estimated to depreciate at the rate of 10% per annum using diminishing balance method for the projected period.000 25.000 Amount (Rs.7 Raw Material Requirements Considering the price competition.000 14.

however. The machine operators should also have relevant experience of handling and operating injection molding machines and plastic processing.000 15. A strong referral base.000 174. 12.000 36.000 10.000 15.000 15. The Production Manager should have considerable knowledge about polymer technology and its properties. The purchaser would be primarily responsible for making daily procurements. 12.000 15. raw material and other purchases as and when required. receivables and also maintain accounts etc.000 25. invoices. The 10% annual increase in revenue is expected to result from increase in product price.000 25.000 10. An accountant is required to process bills. is required for toll manufacturing contracts. Salaries of all employees are estimated to increase at the rate of 10% annually.000 10.) 28.9 Revenue Generation The Sales are expected to increase by 10% every year. of Employees 01 01 01 01 01 01 01 03 02 12 Salary per month (Rs.quality mold.000 Total monthly salary (Rs. The prices are exclusive of the General Sales Tax.000 15.000 15. SMEDA Services / Information related to PM’s Youth Business Loan are FREE OF COST - 11 . preferably having a diploma in plastic technology with 5 to 7 years experience.8 Human Resource Requirement The human resource requirement for the general and management staff are as follows: Table 7: Human Resource Requirement Description Owner Accountant Purchaser Store keeper Production Manager Electrician Hydraulics Technician Machine Operators Helpers Total Staff No.000 20. The proposed project would need a total of 12 persons to handle the plastic injection molding operations.000 10.000 10. Raw material inventories in such a mode of manufacturing are not necessary.) 28.000 It is assumed that the owner would be managing the overall affairs of the plastic molding setup.000 12.

) 120.360 Particulars Plastic containers (contract manufacturing) Total Unit Kg 12.050 Sq Ft. The monthly rent is estimated to be Rs.391. the maintenance cost of the machines are usually high.360 5. The rent is estimated to increase at the rate of 10% per annum for the projected period.10.) 74.391. Utilities Requirements: The following table presents the assumed breakup of utilities on a monthly basis: Table 09: Utilities Description Electricity Water Telephone Total Monthly Charges (Rs. Rent and deposits: The proposed premises will be acquired on a rental basis with 3 months deposit and 3 months advance rent after which rent will be payable on monthly basis. amounting to Rs.). It is anticipated that the machinery would require an overhaul after every five years. since they need to be oiled and cleaned regularly specially before installing a new mold or starting a fresh production process.000 • • The utilities expense is estimated to increase at the rate of 10% per annum for the projected period. SMEDA Services / Information related to PM’s Youth Business Loan are FREE OF COST - 12 . 32. The yearly maintenance cost has been taken to be 5% of the written down value of the machine.000 4.10 Other Costs • Machinery Maintenance: The Injection Molding Machine and molds have a long life.800 per month for the proposed injection molding plastic products unit (2. 16/ Sqft.000 6.000 130. assumed that machinery overhauling expenditures would be incurred at 10% of the price of the Machinery in Year-5 & Year. however./Unit) 72 First Year Sales (kg.The item-wise estimated revenue from injection molding plastic products is as follows Table 08: Revenue Sales Price (Rs.880 First Year Sales Revenue (Rs) 5. therefore. It is.

000 32. 45.000 (1.800 336. Table 10: Working Capital Description Utilities Salaries Rent Total Month 01 01 01 Monthly Charges (Rs. Financial Charges: It is assumed that long-term financing for 8 years will be obtained in order to finance the injection molding setup. office purchases & miscellaneous expenses.2 % • • • The weighted average cost of capital is based on the debt / equity ratio of 90:10. 50. This facility is estimated to be acquired at a rate of 08% per annum with 84 monthly installments over a period of seven years after a one year grace period. utilities and salaries expenses for at least one month. procurement of machinery & equipment and furniture &fixtures etc.) 130.000 174. Cost of Capital: The cost of capital is explained in the following table: Table 11: Cost of Capital Particulars Required return on equity Cost of finance Weighted average cost of capital Rate 20 % 8% 9. 336. therefore. tax rates applicable on the income of a non salaried individual taxpayer are used for income tax calculation of the business.000 and will be amortized equally over a 5 year period. SMEDA Services / Information related to PM’s Youth Business Loan are FREE OF COST - 13 . Taxation: The business is assumed to run as a sole proprietorship.• Working Capital Requirements: It is estimated that an additional amount of Rs.500 per day) is assumed to be incurred for traveling. The installments are assumed to be paid at the end of every month. Office &Miscellaneous Expenses: A monthly expense of Rs.800 will be required as cash in hand to meet the initial working capital requirements during operations. which are expected to increase at the rate of 10% per annum for the projected period. including premises renovation.800 • • Preliminary Expenses: The provision for preliminary expenses is assumed to be Rs. The requirement is based on the rent. The following table gives the break up.

Ferozpur Road near Metro Canal Station. Korangi Industrial Area. Karachi Phone: 021-3568449 Fax: 021-35682150 • Pakistan Industrial Technical Assistance Center (PITAC) 234. Ziauddin Ahmed Road. EXPERTS/CONSULTANTS There are many local suppliers of plastic processing machinery working in Karachi and other cities that may be contacted for quotes or procurement. Karachi 74900 Phone: 021 – 35066955.13. Sector – 30.SUPPLIERS. Limited G-2. 03 Dr. Machinery Supplier / Consultant Contact • Plastipack Machines Pvt. 042-99230702 • Plastics Technology Centre St -2/1. State Life Building No. 042-99230575. Lahore Phone: 042-99230699. 35063589 Fax: 021 – 35060373 SMEDA Services / Information related to PM’s Youth Business Loan are FREE OF COST - 14 . CONTACTS .

533 1.199 2.326.230 767.426 912.614 10.306.182 3.273.882 718.628 30.855.754 13.913.460 48.427.200 2.497 121.124 37.870.600 3.787 429.552 86.960 594.470 42.545 3.263.999 6.950.635.740 2.408.029.157.052.270 796.182 95.000 104.930.678.786 3.296 6.690 4.000 3.307 85.417 876.512 33.Pre-Feasibility Study Injection Molding Plastic Products 14.123.643 95.914 1.000 1.893.) Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Revenue Production Labor Utilities Cost of Sales Gross Profit General Administrative & Selling Expenses Salaries Rent Expense Office & Miscellaneous Expenses Amortization Expenses Depreciation Expense Maintenance Expense Subtotal Operating Income Financial Charges (08% Per Annum) Earnings Before Taxes Tax Net Profit Monthly Profit After Tax 5.429 2.926 42.114 43.446.000 10.560.749.060.292 69.809.657.918 1.740 10.900 1.999 5.546 1.000 159.414.000 2.610 639.286 2.464 4.932 1.185 5.283.000 129.360 5.887.259 5.457.635 5.246 1.400 10.156 111.815 914.528 1. ANNEXURE 14.582 41.490 1.464 1.897 869.236 523.313 8.084.398 6.181 2.175.558 3.769 10.556.202 3.717 1.499.145.000 2.755 1.080 1.512.019 83.093.924 133.864.359.760 476.000 116.631.892 2.682.964 108.343.006.726.200 1.007.782.506.260 3.600 2.222 111.000 143.551.595 4.123 2.749 1.551 831.088 1.957 426.860 576.616 35.809.360 3.600 540.956 130.595.573 2.217.675 106.720 1.364 27.763.015 1.360 156.122.Income Statement INJECTION MOLDING PLASTIC PRODUCTS Projected Income Statement (Rs.629.396 4.975 525.003 1.849.164 1.961 30.252 3.523.599.000 1.256 653.339.648 7.106.402 1.296 800.659.320 3.140.109 939.286 956.600 12.270 790.1 Annexure 1 .280 209.839 2.332.819.235 2.191 1.461.356 1.039.177 3.858 666.097 26.600 432.716.611.538 77.234.996 4.000 393.719 2.151.546 11.546 633.715 1.716 67.553 843.676 148.203 39.499.227.558 90.025.631.496 1.024.246 173.314 1.199.000 586.366 2.280 1.000 10.973 1.458 1.449 63.620.922 539.327 SMEDA Services / Information related to PM’s Youth Business Loan are FREE OF COST - 15 .620 688.712.357.360 756.400 54.076.300 697.429 139.892.354 1.181.779 43.299 1.291 1.772.487 53.287 63.226 7.608 928.360 1.831 15.391.893.473.691 3.639 758.354 4.465.160.859 2.305.244 9.032 73.

636) (235.497 77.937.600 (217.599.974.682 1.244) (351.000 778.603 932.582 10.713 3.816 1.840.760 2.016 336.007.016 525.924 69.749 3.000 596.394) (324.816 461.) Cash Flow From Operating Activities Net Profit Add: Depreciation Expense Amortization Expense Net Cash Flow From Operations Cash Flow From Financing Activities Receipt of Long Term Debt Repayment of Long Term Debt Owner's Equity Net Cash Flow From Financing Activities Cash Flow From Investing Activities Construction Cost Machinery & Mold Office Furniture Advance Rent Preliminary Expenses Net Cash Flow From Investing Activities NET CASH FLOW Cash at the Beginning of the Period Cash at the End of the Period Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 - 426.800 596.800) 336.779 143.156) - (205.616 159.548 3.925 1.548 (120.041.200.902 1.320 2.019 106.938.543 (120.000) (1.457.244) (351.262) (276.165 2.306.287 116.Pre-Feasibility Study Injection Molding Plastic Products 14.320 629.699) (255.487 129.566.552 7.601 758.840 217.113.896.463 922.566.961 1.203 10.636) (235.144 1.032 104.000) (120.095 SMEDA Services / Information related to PM’s Youth Business Loan are FREE OF COST - 16 .023.156) (217.000) 594.614 1.182 95.000 990.228 1.246.543 9.534.800 336.394) (324.628 1.2 Annexure 2 – Statement of Cash Flow INJECTION MOLDING PLASTIC PRODUCTS Projected Statement of Cash Flows (Rs.449) (299.000) (189.937.490 876.473.392.160.400 10.394.959.124 1.449) (299.669.974.262) (276.800) (50.552 1.913 5.000) (196.000 679.861 5.800 932.713 813.463 4.394.549.512 1.682 7.000) (1.938.450 3.418 1.694 1.239 639.460 10.861 1.000 884.000) 1.964 85.896.114 10.151.160.473.418 542.913 1.177.534.699) (255.769 4.364 1.000) (120.

600 40.177.513 3.482 7.913 196.800 149.170.961 974.800 2.Pre-Feasibility Study Injection Molding Plastic Products 14.222 696.358 874.045.548 9.000 2.754 745.100 1.760 1.162 351.241 4.591.026 20.800 1.602.473.742.366.840 2.000 50.366.819.953.177.418.316.929 1.600 932.129.376 1.366.713 5.912.023.895 1.117 5.140 30.442 955.394.500 170.318 604.126.637 79.816 196.623 609.548 196.763.506.243 3.000 2.146 1.219.912.479 65.3 Annexure 3 – Balance Sheet INJECTION MOLDING PLASTIC PRODUCTS Projected Balance Sheet (Rs.800 3.204 2.000 189.171 828.162.000 184.794 4.800 196.463 196.218 1.434.251.823 10.216 972.959.398 859.652 9.604.800 2.171.604.380 671.246 81.127 6.543 196.953.318 5.900 746.146 787.421 73.800 4.000 3.909.623 8.603 1.000 205.156 98.670.358 773.980 675.316.548 9.548 SMEDA Services / Information related to PM’s Youth Business Loan are FREE OF COST - 17 .041 88.729 108.154 1.800 5.) Assets Current Assets Cash & Bank Balance Prepaid Rent Total Current Assets Fixed Assets Machinery & Molds Building Premises Renovation Office Furniture and Fixtures Total Fixed Assets Preliminary Expenses Total Assets Owner's Equity Long Term Liability Total Equity & Liabilities Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 336.291.938.754 3.418 196.600 217.126.090 1.781 1.588 121.358 1.134.567.600 1.505 3.800 9.450.061.003 1.156 5.909.120 2.840 2.418.974.445 137.093.050 153.616 1.160.443.273 71.682 196.937.000 1.800 1.000 3.095 196.051 90.135.605 5.800 7.819.127 (0) 6.800 6.050 111.216 644.171 2.380 4.800 533.896.000 166.127 543.320 134.263 4.809.594.966.713 196.645 6.399 5.080.641 1.959.566.280 8.200.000 2.320 196.966.343 9.501 124.945 100.623 8.966.348 3.357.909.

4 Useful Project Management Tips Technology • Required spare parts & consumables: Suppliers credit agreements and availability as per schedule of maintenance be ensured before start of operations. • SMEDA Services / Information related to PM’s Youth Business Loan are FREE OF COST - 18 . • • • Marketing • • Product Development & Packaging: Experts’ help may be sought for product / service and packaging design & development Ads & P. Human Resources • • Adequacy & Competencies: Skilled and experienced staff should be hired for greater productivity and efficiency Performance Based Remuneration: Attempt to manage human resource cost should be focused through performance measurement and performance based compensation.Bulk Discounts. Training & Skill Development:Encouraging training and skill of self & employees through experts and exposure of best practices is route to success.S. Sales & Distribution Network: agreements are required. Promotion: Business promotion and dissemination through banners and launch events is recommended. Quality Assurance Equipment & Standards: Products’ quality standards must be defined and a system to check them instituted. Machinery Suppliers: Suppliers should be asked for training and after sales services through a proper contract.O. Price during introductory phase may be lower and used as a promotional tool. Energy Requirement: The energy requirements should be properly assessed and alternate source of energy for critical operations must be arranged in advance.Pre-Feasibility Study Injection Molding Plastic Products 14. Cost plus Introductory Discounts: Price should never be allowed to compromise quality. Product brochures should be developed from quality service providers. Product cost estimates should be carefully documented before price setting. Expert's advice and distribution • • Price . this improves credibility.

5 Useful Links • • • • • • • • • • • • • • • • Prime Minister’s Office www.gov.gov.gov.pk Ministry of Education.pk Federation of Pakistan Chambers of Commerce and Industry (FPCCI) www.pk State Bank of Pakistan (SBP) www.pk Government of Balochistan www.pakistan.gov.fpcci.pk First Women Bank Limited (FWBL) www.gov.Pre-Feasibility Study Injection Molding Plastic Products Least cost options for Training and Skill Development (T&SD) may be linked with compensation benefits and awards.com.pk Government of Gilgit Baltistan www. 14.khyberpakhtunkhwa.pk Government of Pakistan www.gov.ajk.sbp.gov.nbp.pk Government of Azad Jamu Kashmir www.pk Small & Medium Enterprises Development Authority (SMEDA) www.moip.pmo.tdap.gov.pk Security Commission of Pakistan (SECP) www.balochistan.pk National Bank of Pakistan (NBP) www.punjab.org.com.pk • SMEDA Services / Information related to PM’s Youth Business Loan are FREE OF COST - 19 .pk Government of Khyber Pakhtoonkhwa www.secp.com.fwbl.gov.pk Government of Punjab www.gov.org.pk Trade Development Authority of Pakistan (TDAP) www.pk Government of Sindh www.gov.smeda.gilgitbaltistan.gov. Training & Standards in Higher Education http://moptt.sindh.pk Ministry of Industries & Production www.

Pre-Feasibility Study Injection Molding Plastic Products 15. KEY ASSUMPTIONS Particulars Sales Increase Increase in Cost of Raw Materials Increase in Staff Salaries Increase in Utilities (Electricity / Water / Gas) Increase in Rent Increase in Office Expenses Debt / Equity Ratio Depreciation o o o Plant Building Machinery & Molds Office Furniture & Equipment 10 % per annum (Diminishing Balance) 10 % per annum (Diminishing Balance) 10 % per annum (Diminishing Balance) 10 % of Cost Price (Year 5 & Year 10) 5% of Written Down Value 8 Years 1 Year Monthly 08 % per annum Tax rates for non-salaried individuals Assumption 10 % per year 10 % per year 10 % per year 10 % per year 10 % per year 10 % per year 90 : 10 Machine Overhauling Cost Machine Annual Maintenance Cost Loan Period Loan Grace Period Loan Installments Financial Charges (Loan Rate) Tax Rate SMEDA Services / Information related to PM’s Youth Business Loan are FREE OF COST - 20 .

Sign up to vote on this title
UsefulNot useful