PRODUCT PROJECT REPORT

A
PRODUCT PROJECT REPORT
On
PAPER NAPKIN
Submitted By
Meghna V. Vadariya
T.Y.B.B.A. (A)
Roll No. 56
Guided By
Prof. Ajay Jayswal
Submitted To
Saurashtra University
Rajkot
Shri Patel Kelvani Mandal College of
Technology
College Road, Junagadh.
Academic year
2016-2017

DECLARATION
I, undersigned, Meghna V. Vadariya the student of T.Y.B.B.A.,
Here by declared that this Project work is my own work and it has been
carried out under the guidance of Prof. Ajay jayswal of Shri P.K.M.
College of Technology & B.Ed. This work has not been previously
submitted to any other University or institution for any examination.
Place: Junagadh
Date: 26th
Sept, 2016
(Signature)
(Meghna V. Vadariya)

PREFACE
Being a student of TYBBA I am extremely happy to submit this
project report on small scale industry under the prescribed syllabus of
Saurashtra University for particularly introducing a subject
“Entrepreneurship”. Entrepreneurship is management of SSI with a view
to create and develop such skill and attitude among the student in
practical and professional education faculty.
The goal or object of this report is to make student learn about
various factors that should be a kept in mind before starting up and
industry in other words, it is purely entrepreneurship development and
training for establishment of SSI.
The contribution of SSI is 45% in the economic growth of the
country. So it becomes essential to study the management and working
of SSIs as a student of management.

ACKNOWLEDGEMENT
It is really the matter of a great pleasure for me to undertake and
presents this creative and practical work, a product project report of
TYBBA on Paper cup.
This report has been prepared by keep in mind various aspects
relating to financial capacity of the plant which is to be an established,
the fast growth and development in the field of paper cup industry.
I sincerely thank Prof. Ajay jayswal for their guidance and
encouragement in carrying out this project work. I would also like to
express my gratitude to SSIs and all those who have assisted me during
the period of my project work.
Finally yet importantly, the help & support of my friends and
professors have made this venture successful. Therefore, I would like to
thank them all from care of my heart.
- Meghna V. Vadariya

INDEX
Sr. No Particulars Pg.
No.
1 Project At Glance 1
2 Owners & Promoters Bio-Data 2
3 Paper Napkin Varieties 4
4 Project Location’s Justification 5
5 Introduction of Product 9
6 History of Product 10
7 Market Potential 11
8 Production Schedule 12
9 Financial Aspects 14
10 Means of Finance 17
11 Financial Analysis 18
12 Profitability of project 19
13 Project summary 20
14 Balance sheet for 5 years 21
15 B.E.P. statement for 5 years 26
16 Project Advancement and Future
Planning
29
17 Bibliography 30

PROJECT AT GLANCE
Name of the Unit: Rima paper napkins
Address for communication: 366, GIDC-1,
Dolatpara,
Junagadh - 362001
Type of Unit: Small Scale Industry
Name of product: Paper napkin
SSI Registration No.: Apply for registration
Subsidy Registration No.: Apply for registration
Details of the Location & Unit: 365, GIDC-1,
Dolatpara,
Junagadh - 362001
Partner’s Name & Address: Megha V. Vadariya
Ta.- Junagadh
Dis.- Junagadh
Mo.-
Denisha A. Ladani
Ta.- Keshod
Dis.- Junagadh
Mo.-

OWNERS & PROMOTERS BIO-DATA
(PARTNER’S DETAILS)
There are mainly two partners:
A. Meghna V. Vadariya
B. Denisha A. Ladani
(A) Megha V. Vadariya
Name : Megha V. Vadariya
Age : 20 years
Religion : Hindu
Address for Communication :
Financial Contribution : 50%
Responsibility : finance manager
Education : undergoing BBA from
Saurashtra University
Share in profit : 50%

(B) Denisha A. Ladani
Name : Denisha A. Ladani
Age : 23 years
Address for communication :
Financial Contribution : 50%
Responsibility : Marketing manager
Education : MBA from Gujarat
University
Share in profit : 50%

PROJECT LOCATION’S JUSTIFICATION
Location is the prime factor which has to be considering for
starting a new business. The location should be decided by considering all
factors and making independent analysis of each variable separately
through cost benefit analysis and the location should either be near to the
market (i.e. customers) or where the raw material is easily available in
adequate quantity.
 Availability of raw material :
The raw material is an important and initial part of
Production process. It should be easily available at reasonable price and
time because it is first step of production process for any industry.
In case of this industry the basic raw material is paper which
are available from nearby districts. Our Raw material supplier is
Luxurious Paper Products, Metoda GIDC, Rajkot.
 Labour resources:
Labour resources are the second important thing for any
industry for effectively running and achieve maximum production.
Labour should be available at least cost.
In this case skilled and unskilled labour required which is
available from nearby villages.

 Electricity supply:
The continuous electricity supply is very important for
manufacturing process of this unit to run the machines. And due to
residential area the electricity company provides electricity continuous
and at a current rate.
 Transportation facilities:
Transport the raw material and finished products from one
place to another place each industry should required of good transport
facility. There are many transport companies situated in nearby area.
 Market facilities:
The demand of paper napkins is increasing at a very high
rate because it is easy to use, hygienic and eco-friendly. As paper napkins
are a product of daily consumption and necessity, their marketing will not
be a problem as the consumers are aware of the advantages of using paper
napkins. The raw materials are indigenously available and the
manufacturing process is also simple.
Paper napkins find potential market in IT companies,
Educational Institutions Canteens, Industrial Canteens, Restaurants, Fast
Foods, Catering People, Tea Shops, Paper Product Dealers and Super
Markets.

 Miscellaneous Factors:
We have selected our location on the basis of following
factors.
a) Availability of infrastructural facility.
b) Availability of Banks or financial institution.
c) Availability of bodies such as Hospitals,
dispensaries, post office, etc… enjoyed by the
communities.

Location
 Registered office:
366, GIDC-1,
Dolatpara,
Junagadh – 362001
 Production Location:
“RIMA PAPER NAPKINS”
365, GIDC-1,
Dolatpara,
Junagadh - 362001

INTRODUCTION OF PRODUCT
Paper napkin is a small piece of tissue paper used for hand or face
cleaning. These are becoming popular with the catering more and more
used in households, restaurant, institutions etc. These are absorbent,
hygienic, and light can be had with attractive printing.
Paper napkin also became popular with expense-conscious
restaurateurs, and not simply for their lower initial cost; they were found
to be more convenient and to eliminate the costs of, day in and day out,
sending cloth napkins out to be laundered and receiving them back into
inventory. Equally important, with paper napkins there is never the
possibility of giving a guest a napkin with a residual stain on it or, sin of
all restaurant sins, giving a dinner a used napkin.
Paper napkins come in a broad range of sizes, patterns, and quality.
There are paper napkins with every kind of holiday design printed on
them, colorful napkins for colorful parties, and even paper napkins that
closely resemble cloth. You may order custom-designed paper napkins
with the names and dates of the commemorative occasions you specify
printed on them.

HISTORY OF PAPER NAPKIN
Conventionally, the napkin is often folded and placed to the
left of the place setting, outside the outermost fork. In a restaurant setting
or a caterer’s hall, it may be folded into more elaborate shapes and
displayed on the empty plate. Origami techniques can be use to create a
three-dimensional design. A napkin may also be held together in a bundle
with cutlery by a napkin ring. Alternatively, paper napkin may be
contained with a napkin holder.
Napkins were used in ancient Roman times. One of the
earliest references to table napkins in English date to 1384-85.
Summaries of napkin history often say that the ancient
Greeks used bread to wipe their hands. This is suggested by a passage in
one of Alciphron’s letters (3:44), and some remarks by the sausage seller
in Aristophanes’ play, the knights. The bread in both texts is referred to
as apomagdalia, which simply means bread from inside the crust known
as the crumb, and not special “napkin bread”. The use of paper napkins is
documented in ancient china, where paper was invented in the 2nd
century
BC. Paper napkins were known as chih pha, folded in squares, and used
for the serving of tea. Textual evidence of paper napkins appears in a
description of the possessions of the yu family, from the city of
Hangzhou.

MARKET POTENTIAL
Tissue paper is a lightweight paper and has become one of
the most essential commodities of daily life. The tissue paper come into
use in 1920’s and since then the consumption of tissue paper has been
consistently increasing. The continuous developments in the tissue paper
industry have enabled individuals to lead a more sterile and hygienic life.
The habit of having a paper napkin or a face tissue or hand
tissue in a handbag or a travel kit has become a regular practice among
the middle-class in the rural regions of emerging countries. Most
interestingly, the middle-class-especially women believe that they are
people from the elite stratum of society through these practices.
Urbanization has made a profound impact on our dining
habits. One of the notable changes is the increased use of paper napkins
now a days, which was otherwise could be seen only in western countries.
Plain paper napkins are now being widely used in restaurants,
households, vehicles, industries, institutions etc. Paper napkins with
colorful layout and attractive designs are having bright prospects with our
restaurants focusing on tidiness and adornment.

PRODUCTION SCHEDULE
A. Production Process
Tissue paper roll are fed to the flexographic printing
machine with attachment for the manufacturing of paper napkins wherein,
these are printed and cut to the size with the device already fixed with the
machine. These are then packed in numbers or as desired.

B. Production capacity
Installed 100%:
The production capacity of this established plant will be
12,000 sheets per day.
Utilized 50%:
The production capacity of this established plant will be
6,000 sheets per day.
The schedule for production would be as follows:
9 a.m. to 1 p.m.
&
3 p.m. to 7 p.m.
The whole production process would be carried out
simultaneously and the post production will also be speedily.

FINANCIAL ASPECTS
A. Fixed capital
i. Land and Building:
Sr. No. Particulars Sq. m. Price (Per
Sq. m.)
Total value
(Rs.)
1 land 100 15,000 15,00,000
2 Building 80 10,000 8,00,000
Total 23,00,000
ii. Machinery and Equipments
Sr. No. Description Quantity Value
1 2 color flexographic machine with
attachment of paper napkin
1 4,00,000
2 Testing equipment L.S.
3 Edge sealing and cutting machine L.S.
4 Hand tools L.S.
5 Sales tax, freight & insurance Etc. 20,000
Total 4,20,000
iii. preliminary expenses 10,000
Total Fixed capital (i + ii + iii) 27,30,000

B. Working capital
i. Staff and Labour (Per Month):
Sr. No. Description No. Salary Total
1 Sale Cum Production supervisor 1 12,000 12,000
2 Skilled Worker 1 8,000 8,000
3 Unskilled Worker 1 5,000 5,000
Total 25,000
ii. Raw Materials Requirements (Per Month):
Sr. No. Description Quantity Value
1 Tissue Paper 21 GSM 6.25 Kg 1,87,500
2 Inks & other consumables L.S. 5,000
3 Packing Material L.S. 500
Total 1,93,000

iii. Other Expenses (Per Month):
Sr. No. Description Amount
1 Electricity Charges 1,300
2 Advertisement & travelling 1,000
3 Transport 1,500
4 Consumable and stores etc. 500
5 Postage Exp. / telephones 500
6 Stationary 500
7 Repairs and maintenances 1,000
Total 6,300
iv. Total Working Capital for 3 months:
(Per Month)
1 Raw material (1,93,000 x 3) 5,79,000
2 Salary (25,000 x 3) 75,000
3 Other expenses (6,300 x 3) 18,900
Total 6,72,900

TOTAL CAPITAL INVESTMENT:
Fixed Capital : 27,30,000
(+) Working Capital for 3 months : 6,72,900
Total : 34,02,900
MEANS OF FINANCE
(1) Vadariya Megha V. 17,01,450
(2) Ladani Denisha A. 17,01,450
Total Capital Investment 34,02,900

Financial Analysis
A. Cost of Production (Per Year):
1 Total Recurring Cost 26,91,600
2 Depreciation on Land @ 10% 1,50,000
3 Depreciation on Building @ 5% 4,000
4 Depreciation on Machine @ 10% 42,000
Total 28,87,600
B. Turnover (Per Year):
Sr. No. Description Qty Rate(Rs.) Value(Rs.)
1 Paper Napkins 18,00,000 2 36,00,000
Total 36,00,000
C. Net Profit (Before Taxation)(Per Year):
Turn Over : 36,00,000
(-)Cost of Production : 28,87,600
Total : 7,12,400

PROFITABILITY OF PROJECT
Particulars Amount
Sales and production 36,00,000
Raw materials 23,16,000
Salary & wages 3,00,000
Electricity Consumed 75,600
Taxes – Insurance 2,40,000
Depreciation 1,96,000

PROJECT SUMMARY
Particular Amount
Sales 36,00,000
(-) Variable cost 23,31,600
Contribution 12,68,400
(-) Fixed cost 3,60,000
PBIT 9,08,400
(-) Tax (33.33%) 3,02,770
PAT 6,05,630

BALANCE SHEET FOR 5 YEARS
For 2016-17
Liabilities Amount Assets Amount
Capital (1:1) Land – 15,00,000
Meghna - 17,01,450 (-) Dep. -1,50,000 13,50,000
Denisha -17,01,450 34,02,900
Building -8,00,000
(-) Dep. -4,000 7,96,000
Net Profit (1:1)
Meghna – 3,02,815 Machine -4,00,000
Denisha – 3,02,815 6,05,630 (-) Dep. -42,000 3,58,000
Cash & Bank Bal. 15,04,530
40,08,530 40,08,530

For 2017-18
Capital (1:1) Land – 13,50,000
Meghna – 17,01,450 (-) Dep. -1,50,000 12,00,000
Denisha -17,01,450 34,02,900
Building -7,96,000
(-) Dep. -4,000 7,92,000
Net Profit (1:1)
Meghna – 3,87,379 Machine -3,58,000
Denisha – 3,87,379 7,74,759 (-) Dep. -42,000 3,16,000
41,77,659 41,77,659

For 2018-19
Capital (1:1) Land – 12,00,000
Meghna – 17,01,450 (-) Dep. -1,50,000 10,50,000
Denisha -17,01,450 34,02,900
Building -7,92,000
(-) Dep. -4,000 7,88,000
Net Profit (1:1)
Meghna – 4,71,943 Machine -3,16,000
Denisha – 4,71,943 9,43,887 (-) Dep. -42,000 2,74,000
43,46,787 43,46,787

For 2019-20
Capital (1:1) Land – 10,50,000
Meghna – 17,01,450 (-) Dep. -1,50,000 9,00,000
Denisha -17,01,450 34,02,900
Building -7,88,000
(-) Dep. -4,000 7,84,000
Net Profit (1:1)
Meghna – 5,56,508 Machine -2,74,000
Denisha – 5,56,508 11,13,016 (-) Dep. -42,000 2,32,000
45,15,916 45,15,916

For 2020-21
Capital (1:1) Land – 9,00,000
Meghna – 17,01,450 (-) Dep. -1,50,000 7,50,000
Denisha -17,01,450 34,02,900
Building -7,84,000
(-) Dep. -4,000 7,80,000
Net Profit (1:1)
Meghna – 6,41,072 Machine -2,32,000
Denisha – 6,41,072 12,82,144 (-) Dep. -42,000 1,90,000
46,85,044 46,85,044

B.E.P. Statement for 5 years
Particulars 1st
year 2nd
year 3rd
year 4th
year 5th
year
50% 60% 70% 80% 90%
Sales 36,00,000 43,20,000 50,40,000 57,60,000 64,80,000
Less
Variable
Exps.
Raw
materials
23,16,000 27,79,200 32,42,400 37,05,600 41,68,800
Electricity
charges
15,600 18,720 21,840 24,960 28080
Total
Variable
Exps.
23,31,600 27,97,920 32,64,240 37,30,560 41,96,880
=
Contribution
12,68,400 15,22,080 17,75,760 20,29,440 22,83,120
Less Fixed
Cost
Salary & 3,00,000 3,00,000 3,00,000 3,00,000 3,00,000

wages
Advertisem
ent &
travelling
12,000 12,000 12,000 12,000 12,000
Transport 18,000 18,000 18,000 18,000 18,000
Consumable
and stores
etc.
6,000 6,000 6,000 6,000 6,000
Postage
Exp. /
telephones
6,000 6,000 6,000 6,000 6,000
Stationary 6,000 6,000 6,000 6,000 6,000
Repairs and
maintenance
12,000 12,000 12,000 12,000 12,000
Total fixed
cost
3,60,000 3,60,000 3,60,000 3,60,000 3,60,000
Net Profit 9,08,400 11,62,080 14,15,760 16,69,440 19,23,120
B.E.P. 28.38% 23.65% 20.27% 17.74% 15.77%

P.V. Ratio:
Contribution
= x 100
Sales
12,68,400
= x 100
36,00,000
= 35.23%
Break Even Point (in Rs.):
Fixed Cost
= x 100
P.V. Ratio
3,60,000
= x 100
35.23
= 10,21,856.37

PROJECT ADVANCEMENT AND FUTURE
PROSPECTS
Paper napkin is used in all hotels and restaurants, it is used
by human being as a substitute if handkerchief. In homes at the time of
dinner, lunch or breakfast it is extensively used. Paper napkin is a costlier
affair and cannot be afforded by all categories of persons. Therefore, high
or medium class family uses it. Paper napkin age becoming popular with
catering industry due to its manifold uses. These are absorbent, hygienic
light and can be had with attractive printing.
From a market survey Indian paper industry has a huge
potentials and prospects in coming future. In our country, demand for
paper is rapidly increasing.

BIBLIOGRAPHY
Books:
 Production Management
- By: Himalaya Publishing House
 Marketing Management
- By: Tapan K. Panda
 Financial Management
- By: B.S. Shah
 Human Resource Management
- By: K. Aswathappa
Websites:
 www.google.com
 Wikipedia

PRODUCT PROJECT REPORT

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