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1. INTRODUCTION
Chemically, soap is a salt of a fatty acid. Soaps are mainly used as surfactants
for washing, bathing, and cleaning, but they are also used in textile spinning and are
important components of lubricants.
Soaps for cleansing are obtained by treating vegetable or animal oils and fats
with a strongly alkaline solution. Fats and oils are composed of triglycerides; three
molecules of fatty acids are attached to a single molecule of glycerol. The alkaline
solution, which is often called lye (although the term "lye soap" refers almost
exclusively to soaps made with sodium hydroxide) brings about a chemical reaction
known as saponification. In this reaction, the triglyceride fats are first hydrolyzed
into free fatty acids, and then these combine with the alkali to form crude soap, an
amalgam of various soap salts, excess fat or alkali, water, and liberated glycerol
(glycerin). The glycerin is a useful by-product, which can be left in the soap product
as a softening agent, or isolated for other uses.
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Soap
3. MARKET POTENTIAL
The market of soap is growing at 7% a year. This means that the incremental
demand generation is 5% over and above the population growth. With increasing
awareness of hygienic standards, the market for the soaps could grow at a rate
higher than 8% annually. Interestingly, 60% of the market is now sourced from the
rural sector. This means that the variance between the two segments is not very
large. Since upper-end market focus is the urban areas, margins come from the
urban sector.
4. MARKETING STRATEGY
There are many established national as well as international brands but they
have captured mainly the urban and elite markets and for a quality product, there is
a vast market which can be penetrated by offering competitive prices. Apart from a
growing household market, other lucrative segments are spa, hotels, restaurants, etc.
Marketing would play a crucial role and placement, publicity, commission to
retailers etc. are important aspects.
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Chemical Division
6. IMPLEMENTATION SCHEDULE
The approximate time required for various activities is given below.
However, it may vary from place to place depending upon the local circumstances
and enthusiasm of the entrepreneur:
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Soap
7. TECHNICAL CONCEPTS
7.1. Process of Manufacture
Toilet soap and its method of manufacturing is more or less similar to other
toilets soap. It is fancy because of its standard quality raw material and packing. To
prepare this fancy soap, first of all its formulation is to be set in following way:
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Chemical Division
8. FINANCIAL ASPECTS
8.1. Fixed Capital
Land & Building
Land of 200 Sq. mtr and Covered area of 100 Sq. mtr. rented @ 12,000/- per month
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Soap
8.2.3. Utilities
S. No. Particular Value (Rs.)
1 Power @ Rs. 7/- (60 units per day) 25 Days 10,500
2 Water 1,000
Total 11,500
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Chemical Division
9. FINANCIAL ANALYSIS
9.1. Cost of Production (Per Annum)
Sl.No. Cost of Production (P.A.) Amount (Rs.)
1 Total recurring expenditure 36,72,600
2 Depreciation on Machinery & Equipments @ 10% 31,570
3 Depreciation on furniture and lab equipments @ 20% 6,000
4 Interest on total investment @ 14% 1,34,792
Total 38,44,962
Sale Realization
Cost of each soap @ Rs.10/-
Cost of 4,76,400 soaps Rs. 47,64,000
= 19.29 %
= 95.45 %
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Soap
B.E.P
6,08,202
= X 100
6,08,202 + 9,19,038
= 39.8 %
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