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BEAUTY PARLOUR

A.

INTRODUCTION

Life style is fast changing in the modern era, and the women have become more
conscious about their make up. More women are seen frequenting the beauty
parlours for availing themselves of some kind of service to enhance their
appearance to look good.

The status of women has improved a lot and is

improving further. This has resulted in their life style changing. Also their
economic independence encourages them to resort to this type of service.

B.

PRODUCT USES

This is a service industry

C.

MARKET POTENTIAL

As more and more women are becoming beauty conscious in the modern era,
the beauty parlours will have more patronage.

A beauty parlour with all

modern facilities provide services at a reasonable charges so that more visits


could be expected from each individual.

D.

TECHNICAL ASPECTS

1.

Installed capacity

Based on the service of the beauty parlour and the number of persons to be
employed the capacity is determined. For the proposed service of the beauty
parlour, the following services can be given and taken as installed capacity.
Nos.

Rate(Rs.)

Total value (Rs.)

Eye Brow

2400

15.00

36000

Manicure

600

40.00

24000

Pedicure

240

55.00

13200

Head Massage

360

55.00

19800

Hair bleaching

720

55.00

39600

Arm bleaching

840

55.00

46200

Face bleaching

960

55.00

52800

Stomach bleaching

240

55.00

13200

Waxing

840

40.00

33600

Facial

720

120.00

86400

Hair style

2400

25.00

60000

Hair cutting

2400

25.00

60000

Synthetic dye

480

80.00

38400

Bridal make up

120

800.00

96000

Puffing of hair

120

200.00

24000

Make-up

120

150.00

18000

Total

2.

661200

Equipments

Qty.

Unit Cost(Rs.)

Total cost (Rs.)

Rotating chairs

2 nos.

10000

20000

Mirrors (Big size)

2 nos.

1500

3000

Dressing tables

2 nos.

5000

10000

Drier

2 nos.

6000

12000

Massager

2 nos.

1500

3000

Ozone machine

1 no.

4000

4000

Interiors, Furniture

28000

Total
80000

3.

Process

The process of a beauty parlour is a personalised service. This will vary from
case to case.

4.

Consumables

Cosmetic items are to be regularly purchased from shops. The main cosmetics
to be purchased are moisturizers, lotions, nailpolish, lipsticks, compact
powder, eye paints, eye liners, eye shadows, muskara, blushers, pancake.

5.

Land & Building

A covered area of 300 sqft. is to be taken on rent.

6.

Utilities

Power: Only domestic power connection is required.

Water: About 500 litres of water is required for washing and human
consumption.

Man Power:
Category

Nos.

Monthly

Total

Beautician

4000

4000

Helper

3000

3000
7000

Add: 20% benefits

1400

Total

8400

Total salary per annum (Rs.lakhs)

7.

Rs.1.01 lakhs

Implementation Schedule

The projects can be implemented within a month after financial arrangements


are made.

ASSUMPTIONS
-

Total Revenue at 100% is assumed at Rs.6.61 lakhs per annum. This is


based on number of persons to be employed and infrastructure facilities
to be created. This can be increased.

During first year 60% of the capacity is proposed to utilised. This will be
increased to 70% and 80% in subsequent years.
The cost of materials at 100% works out to Rs.6000 p. m
Electricity charge for lighting is assumed at Rs.500 per month.
Wages & Salaries is assumed for two persons.
Depreciation is calculated on WDV method.
General & Adm. Expenses is estimated at Rs.6000 per month.
Interest on Term loan is calculated at 12% p.a.
Income tax is provided at 33.99% on taxable income.
LIST OF EQUIPMENT SUPPLIERS

1.

Angles, Shop No.14, 29, Cisons Complex, 150, Montieth Road, Egmore,
Chennai 600 008.

2.

Monica Beauty Centre, No. 22 (New No. 43 ) NSC Bose Road,


Chennai 600 079.

3.

The Beauty Shoppe, 6,3rd Floor,Alsa Mall, Montieth Road, Egmore-79

LIST OF CONSUMABLE SUPPLIERS

1.

Molly-An Beauty Centre, 85 New-8,4th Main Road, Gandhi Nagar


Chennai-600 020

2.

Lakme Beauty Salon, 142, Nungambakkam High Road, Chennai 600 34.

3.

Tips & Toes Cosmetic India Ltd., No.44, Vallalar Street, Aminjikarai,
Chennai 600 029.

4.

Rajendra Traders, No.12, Kasi Chetty Street, Chennai 600 001.

FINANCIAL ASPECTS

1. COST OF PROJECT
[Rs.lakhs]

Building (Advance)

0.30

Equipments

0.80

Pre-Operative expenses

0.20

Margin for Working Capital

0.10

Total

1.40

2. MEANS OF FINANCE

Capital

0.95

Term Loan

0.45

Total

1.40

3. COST OF PRODUCTION & PROFITABILITY STATEMENTS

Years

Rs. lakhs

Installed Capacity
Total Income p.a. (Rs.lakhs)

6.61

6.61

6.61

Utilisation

60%

70%

80%

Income p.a. (Rs.lakhs)

3.97

4.63

5.29

Consumables (Rs.6000 p.m)

0.43

0.50

0.58

Power

0.06

0.06

0.06

Wages & Salaries

1.01

1.06

1.11

Repairs & Maintenance

0.60

0.66

0.73

Depreciation

0.20

0.15

0.11

Cost of Production

2.30

2.43

2.59

Admin. & General expenses

0.72

0.76

0.80

Interest on Term Loan

0.05

0.05

0.03

Interest on Working Capital

0.00

0.00

0.00

Total

3.07

3.24

3.42

Profit Before Tax

0.90

1.39

1.87

Provision for tax

0.00

0.47

0.64

Profit After Tax

0.90

0.92

1.23

Add: Depreciation

0.20

0.15

0.11

Cash Accruals

1.10

1.07

1.34

Margin

Bank

4. WORKING CAPITAL:
Months Values

Consumptions

Amount Finance

Raw Materials

0.50

0.02

100%

0.02

0.00

Expenses

1.00

0.03

100%

0.03

0.00

0.05

0.00

0.05

6. PROFITABILITY RATIOS BASED ON 80% UTILISATION


Profit after Tax

1.23

Sales

23%

5.29

Profit before Interest and Tax

1.90

Total Investment

136%

1.40

Profit after Tax

1.23

Promoters Capital

129%

0.95

7. BREAK EVEN LEVEL


Fixed Cost (FC):

[Rs. lakhs]

Wages & Salaries

1.11

Repairs & Maintenance

0.73

Depreciation

0.11

Admin. & General expenses

0.80

Interest on TL

0.03
2.78

Profit Before Tax (P)

1.87

FC x 100
BEL =

2.78
=

FC +P

80
x

4.65

x
100

48% of installed capacity

100