Project Report

Manufacturing of Readymade
Garments

Prepared By :-
Shahnaz M. Ansari
( B.com , M.com , CA Inter Qualified )

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Project at Glance:

Sai Sarda Garment

Shop no. 401, Hare Krishna Market
Nehru Chowk, Ulhasnaga-2
Thane-421002
Maharashtra

Email :
Phone :
Constitution : Proprietorship
Proprietor Name : Ashok Alwani.
Address : A Block Road, Bk 13

Near Sai Baba Mandir

Near S.D.T Kalani College

Ulhasnagar-421001

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 INDEX

(1) Introduction & Market Potential Page 4

(2) Basis & Presumptions Page 5

(3) Technical Aspects Page 6

(4) Quality Control & Standard Page 7

(5) Financial Aspects Page 8

(6) Financial Analysis Page 10

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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. Its contribution to industrial
production, employment and export earnings are very significant. This
industry provides one of the basic necessities of life. The employment
provided by it is a source of livelihood for millions of people. It also
provides maximum employment with minimum capital investment.
Since this industry is highly labour-intensive, it is ideally suited to
Indian condition. This project report is prepared for the manufacture of
Ladies kurties, tops, leggings, and all other similar items. as they find
wide acceptance in local and international markets. Any person having
the knowledge of cutting and stitching operations can easily set up such
establishments.

MARKET POTENTIAL:

Readymade garments are the choice of urban people. It is also gaining

wider acceptance in semi-urban and rural areas. The huge charges made
by tailors and delay in delivery has made people to switch over to
readymade garments. In domestic market and export market, it has
made spectacular progress in the last decade. This industry is becoming
very vibrant and lot of foreign investment pouring in this industry
because of low risk and high earning nature of this industry. As these
products are fashion oriented, entrepreneurs should always keep in
mind the changing fashion styles. Considering its advantageous
position, it is assumed that there will be no constraint in marketing of
Ladies readymade garments.

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BASIS & PRESUMPTIONS:

1. Since this industry is labour- intensive, the working efficiency is

considered at 75%

2. Costs of machinery and equipment/ material indicated refer to a

particular make and approximately to those prevailing at the time
of preparation of this project.

3. Installation and electrification cost is taken @ 10% of cost of

machinery and equipment.

4. Non-refundable deposits, project report cost, trial production,

security deposits with Electricity Board are taken under pre-
operative expenses.

5. Depreciation has been considered:

(a) On Building @ 5%
(b) On plant and machinery @ 10%
(c) On office furniture and fixtures @ 15%
(d)On other fixed assets @ 15%.

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TECHNICAL ASPECTS:

Process of Manufacture: The manufacturing process involves the

following steps:

1. Procurement of Fabrics Procurement of Fabric:

Dyed/bleached/printed cotton/synthetic fabrics as per demand are

to be procured from the open market. The fabric will be inspected
by laying on the inspection table against light before cutting so
that unevenness in colour/shade or any other fault, if any visible
in the fabric are eliminated.

2. Cutting and Stitching:

The inspected fabric is placed on the cutting table in layers and

then the different parts of the respective garments are demarked
by a chalk as per different sizes. Cutting is carried out by the
cutting machine. Stitching is carried out for individual portion of
the garments by skilled workers with the help of over-lock, lock
stitch machines etc

3. Checking, Pressing and Packing:

Final checking is done before pressing and packing on the

checking table so that any fault in the piece may be removed and
protruding threads eliminated. The individual pieces are pressed
by steam presses to remove any wrinkle marks and packed in the
carton boxes.
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QUALITY CONTROL & STANDARD

The quality of garments mainly depends on quality of fabric used.

Therefore, care must be taken while purchasing fabrics to ensure good
colourfastness properties, uniformity in shade etc. Generally, garments
are made as per customer's specification in respect of size, design and
fashion.

SI. NO. BIS No. Title

1. IS: 12675 Garment Quality Guide.
2. IS: 4039 Readymade Garment Packaging
For Export.
3 IS:10194 Garment Guide for Positioning of
Labels.

POLLUTION CONTROL:
The process of manufacture does not generate pollution. However,
entrepreneurs are to contact State Pollution Control Board for
necessary guidance.

ENERGY CONSERVATION:
Maximum care should be taken while selecting the machinery and other
electrical equipment’s so as to ensure minimum power consumption.

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 FINANCIAL ASPECTS:

[A] Fixed Capital

(i) Rented Shop

Security Deposit Rs. 50,000

(ii) Machinery & Equipment’s

SI Machinery Description Qty Rate Value

No.
1. Single Needle Lock Stitch 6 20,000 1,20,000
Machine with motor
2. Power driven cloth cutting 1 10,000 10,000
machine
3. Jack feed of the arm 1 50,000 50,000
sewing machine
4. Hot Fusing Press 1 10,000 10,000
Total 1,90,000

(iii) Other Fixed Assets

1. Light Fitting 10,000
2. Furniture 10,000
3. Pre-operative expenses 30,000
Total 50,000

Total Fixed Capital 2,40,000

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 [B] Working Capital (Per Month)
(i) Staff & Labour
Personnel No. Rate(Rs.) Amount
Manager 1 40,000 40,000
Cutting Master 1 20,000 20,000
Skilled Worker 5 15,000 75,000
Pressman 1 10,000 10,000
Unskilled 1 8,000 8,000
Worker
Total 1,53,000

(ii) Raw Material (Per Month)

Item Description Value ( Rs.)
Fabric 1,20,000
Sewing Threads 30,000
Trims & Embellishments 20,000
Packing Material 10,000
Total 1,80,000

(iii) Utilities: (Per Month)

Electricity 14,000
Water Charges 2,000
Total 16,000

(iv) Other Contingent Expenses

Rent 12,000
Repair & Maintenance 1,000
Transport/ Travelling Charges 1,000
Telephone Expenses 800
Miscellaneous Expenses 1,000
Total 15,800

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Total Recurring expenses (per month)
Staff & Labour 1,53,000
Raw Material 1,80,000
Utilities 16,000
Other contingent expenses 15,800
Total 3,64,800

TOTAL CAPITAL INVESTMENT:

Fixed capital 2,90,000

Working capital 3,64,800
Total Rs. 6,54,800/-

FINANCIAL ANALYSIS

(1) Cost of Production (Per Annum)

i. Recurring Expenses 43,77,600

ii. Depreciation on Machinery @ 10% 19,000
iii. Depreciation on Furniture and 10,000
Other Fixed Assets@20%

Total: Rs. 44,06,600/-

(2) Estimated Turnover (Per Annum)

Product Qty Rate Value (Rs.)

Top 40,000 100 40,00,000
Kurties 10,000 110 11,00,000
Other 5,000 80 4,00,000
55,00,000
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 (3) Net Profit (Per Annum)

Sales Value 55,00,000

Less: Cost of Production (44,06,600)
Net Profit Rs. 10,93,400/-

Net Profit Ratio

Net Profit = 10,93,400 = 0.1988 or 19.88%

Annual Turnover 55,00,000

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