BUSINESS PLAN

ON

Apex Computer
Furniture
NAME OF STUDENTS
VIPUL PANAKHANIYA (25)
DARSHAN ABHANI (01)

 Submitted To
Gujarat Technological University
AHMEDABAD

 Guided By
Mrs. Richa Agarwal
 INDEX

Sr. Particular Page

No. No.
1. Introduction

2. Project at a Glance

Executive Summary
3. Bio data Of Partners

4. Basis & Presumption

Production Plan
5. Product Details

Operations Plan
6. Production Process

7. Production Capacity

Organizational Plan
8. Organization Structure
9. Implementation Schedule
10. Location Justification
Production Plan
11. Portrait Of Product
12. Raw Material
Marketing Plan
13. Market Potential
14. Pricing Policy
15. Promotion
16. Marketing Segmentation
Financial Plan
17. Fixed Capital Details
18. Working Capital Details
19. Sources of Finance
20. Cost of Production
Sr. Particular Page
No. No.
21. List Of Suppliers
22. Risk Factors
23. Conclusion
 INTRODUCTION

Small scale industry is quickly gearing up to meet emerging

challenges in the global economy through content innovation and
adoption of cutting edge technology to provide supervisor customer
solution.

The definition of small scale industry varies from one country to

another.

Generally a SSI is presently defined as “a unit engaged in

manufacturing, servicing, repairing, processing preservation of goods
having investment in plant & machinery at an original cost of
exceeding 3 crore.

The small scale industry sector as an important segment of the Indian

economy accounts for:

1. 95% present of the industrial unit

2. 40% of output of the manufacturing sector
3. 35% of the total exports & provides employment to around 18
millions persons.

More recently, enhancing SSI has been viewed as an effective way of

fostering the private sectors, contribution to both the growth and
the equity objective of the development.

The SSI sector has been receiving special attention from the policy
makers in addressing its requirements be it credit, marketing,
technology, entrepreneurship development, fiscal on infrastructural
support.
 PROJECT AT A GLANCE

Name of the unit : “Apex Computer Furniture”

Address of unit : 182 / K1- M. Road,

Opp. Poly Vastra Bhavan,
Aji GIDC – 3, Rajkot

Types of the unit : small scale industry

Form of organization : Partnership firm

Registered office no. : applied for

Partner’s Name : Pankhaniya Vipul S.

Abhani Darshan C.

Brand Name : “Apex”

Product : Computer Furniture

Cost of project : Rs.6762160

No. of employees : 15
 BIO-DATA OF PARTNERS

Partner # 1:

Name : Pankhaniya Vipul S.

Age : 24 Years
Address : Kalawad Road,
Rampark Main Road,
OPP. Virani Science College,
Rajkot 360 005.
Education qualification : MBA
Financial contribution : 55%
Responsibility : Financial & production Manager

Partner # 2:

Name : Abhani Darshan c.

Age : 23 years
Address: Kalawad Road,
Kotecha Chowk,
Rajkot 360 005
Education Qualification : M.B.A.
Financial Contribution : 45%
Responsibility : marketing & Personnel Manager
 BASIS & PRESUMPTION

1. It is presumed that the unit will work for single shift of 8 hours
and 300 days in a year with 75% efficiency.
2. The unit will take minimum three years to achieve full capacity
utilization.
3. Labor wages are taken at the prevailing rates in the local
market.
4. The rate of interest on fixed and working capital is taken at an
average rate of 16% per annum.
5. Cost of machinery and equipments/raw materials indicated
refers to a particular make and prices are approximate to the
prevailing rates at the time of preparation of project report.
 PRODUCT DETAILS
Computer Tables:
The computer table shall be fabricated in knock down design for
easy assembly and transportation. The base frame shall be made of
hallow rectangular mild steel section of 50 mm X 25 mm X 1.2 mm
thickness by cutting in desired size and welding the sections. The
open edges of base frames are protected by PVC cover level
adjusters are mounted suitably at the bottom edge of base frame.

Printer Table
Printer table dose not have any drawer/shelf etc whereas the
computer table shall have a suitable drawer for key board made of 18
mm of one side pre-laminated medium density board below the
drawer, the provision is made for siding board of 9 mm thickness and
width 300 mm which can be taken out on either side upto
approximate 225 mm for placing the mouse and pad.

Computer cum Printer:

Computer cum printer table shall also have a key board drawer shelf
siding board (for keeping the mouse and pad) and a lockable drawer.
Two shelves are also made for keeping CPU UPS and stationery etc.
The side support shall be made of 50 X 6 mm MS flat welded to
main frame. The arms shall be supported on the side frame.

Computer Chairs:
The computer chairs shall be revolving type fabricated in knock
down design for easy assembly and transportation of 12 mm thick
ply, pressed formed and ergonomically shaped seat and back which
are easily available in the market in standard sizes. These seat and
backrest shall be covered with mechanically formed PUF 50 mm
thick with underneath coirised rubber sheet of 12 mm thick.
 PRODUCTION PROCESS
1) Cutting:
It is the first step. Here the required sheets of ply and wood are
cutting in different size and shape as per requirement of furniture.

2) Finishing:
After the cutting ply and wood in different size and shape it has
requirement of finishing for good looking. So here finishing are done
through different tools of it.

3) Assembling:
After the finishing the ply and wood cutting in different size and
shape are joining as per size and shape of furniture by using required
raw material.

4) Polishing:
After completion of structure of furniture in different size and shape,
it has requirement of polishing for good and attractive looking. So
here polishing are done to the furniture by using require polishing
material.

5) Inspection:
To provide the quality product to customer, we are inspecting the
finished goods at different stages so quality of product are maintain.
So the trust of customer towards product and company are maintain.
 PRODUCTION CAPACITY

Computer Tables
Computer tables over all size :
900 x 60 x 750 mm - 1800 nos
Computer cum printer table over all size :
1200 x 700 x 750 mm – 1000 nos.
Printer table cover all size :
750 x 700 x 75 mm – 1800 nos.

Computer Chairs
Computer chairs without arms and adjustable seat having size :
725 x 725 x 950 – 1050 mm – 4000 nos.
Computer chairs with arms and adjustable seat height size :
725 x 725 x 950 – 1050 mm – 3000 nos.
Executive computer chairs with arms and adjustable seat height of
size :
725 x 725 x 1100 – 1200 mm – 1500 nos.

Motive Power:
25 HP

Energy Conservation:
Shunt capacitors should be provided to control power factor. As
electricity is used as a supply of energy in the unit hance, for better
results efficient motor should be used .tube lights, fans etc. should be
kept off as and when not required.

Pollution Control:
Noise pollution created by machines should be controlled within
limits.
 ORGANIZATION STRUCTURE

An organization provides the mechanism for purposive, integrated

development. It has been variously defined by different authors.
Dimnock in his book, Public Administration, has rightly observed;
“An organization is the systematic bringing together of
interdependent parts to form a united whole through which authority,
Co Operative ordination and control may be exercised to achieve a
given purpose. To try to deal with organization as merely a frame
work without considering the people who make it up and those for
who its services are intended would be wholly.

Organization Structure

Partners

Partner 1 Partner 2

Supervisor

Assistance Clerk
Workers
 IMPLEMENTATION SCHEDULE

Sr. No. Particulars Period

1. Selection of site 15 days
2. Preparation of project report 15 days
3. Registration with DIC 7 days
4. Financial arrangements with banks 1.5 months
5. Machinery procurement 1 month
6. Installation of machines 15 days
7. Procurement of raw materials 7 days
8. Recruitment of manpower 7 days
9. Trial production 15 days

Some of the above activities would be carried out simultaneously.

The approximate time required to commence manufacturing would
be 6-7 months.
 LOCATION JUSTIFICATION

Location is also an important factor determining the ultimate success

or failure of SSI on it may depend on small industries ability to
obtain an adequate and regular supply of its raw materials at a
minimum cost to maintain a sufficient labor force and to serve
satisfactorily its customers.

The important factors which should be taken into account in the

selection of are site are …

Availability Of Raw Material:

Aji GIDC, it is a place from where firm can easily obtain raw
material easily at a low transportation cost. Nearness to the sources
of raw material reduce the price.

Availability Of Skilled And Unskilled Labor:

Rajkot is near rather we can say that firm’s location is in the Rajkot.
So firm can easily get skilled workers and the firm has villages near
to their location so they can easily get the unskilled labor at a lower
cost.

Nearness To The Sources Of Motive Power:

Govt. is providing enough power to the firms which are located in

Aji so firm has not any problem about the motive power.
Nearness To The Market:

Firm has enough market around their territory so the firm can easily
find the customers. Due to nearness to the market transportation cost
will reduce so ultimately price will reduce. So the firm can earn more
profit.

Availability Of Transport Facility:

Private or government transportation is available in Aji GIDC so

firm has not any problem to obtain raw material for giving the final
product into market.

Suitability of Climate:

There are no much residential area near to the location of industry

whole area of Aji GIDC is utilize for the purpose of industrial area.
Also the location of Apex furniture is suitable to the climate.
Portrait of product
 PORTRAIT OF PRODUCT

Within a covered span of time, computers have covered out a niche

in the history of mankind and changed the entire gamut of human lift
at an overwhelming ace. Be it business academics, defense strategy,
budgeting research engineering, medicine, space exploration,
communication travel and hospitality, utilities or designing,
computers have established themselves as an indispensable part and
so also the computer furniture. Some commonly used computer
furniture are computer tables, computer cum printer, tables printer
tables, computer chairs with or without arms, computer chairs with
or without coaster wheel base etc.
 RAW MATERIAL

Raw material is the basic necessity of all the manufacturing

company. It is the heart of the manufacturing company.

The basic and important raw materials for computer furniture are …

1) Ball bearing channel is 15” long & 2 mm thick

2) Pre laminated particle board 18 mm
3) Plastic fittings, floor adjuster screws, PVC beading
4) PUF arm set
5) Tapestry / fabric
6) MS strip 50 x 5 mm size, MS round 1.5 size etc
7) MS pedestal arms of assorted size
8) Twin roller type ABS coaster set
9) Plywood seat
10) PVC beading shoes for chairs
11) Powder coating compound
 Raw Material ( in working capital )
Sr. Particulars No. Rate Amount
(Rs.) (Rs.)
1 MS square and rectangular 46 MT 22000 10,12,000
section of assorted size / MT
2 Ball bearing channel 15” long 4600 15 69,000
and 2mm thick set / set
3 Both side pre-laminated particle 6000 600 36,00,000
board 18 mm thick sq. mt sq. mt.
4 Plastic fittings, floor adjuster L. S. 2,25,000
screw, PVC beadings
5 PUF arm set: (set) (chair)
1) For general chair 7000 200 14,00,000
2) For executive chair 1500 350 5,25,000

6 Tapestry / fabric: (Mtr) (Mtr)

1) For general type chair 10,500 100 10,50,000
2) For executive chair 3750 150 5,62,500
7 MS strip 50 x 5 mm size, MS 81 15500 12,55,500
round 1.5 size etc. MT MT
8 MS pedestal arms of assorted 42.5 2500 10,62,500
sizes Set MT
9 Twin roller type ABS coaster set 8500 325 27,62,500
Set Set
10 Plywood seat : (Set) (Set)
(16”x16” & 18”x18”) &
back (16”x14” & 16”x18”) set,
thickness 12 mm and
PU foam set & back set:
1) For general type 7000 1000 70,00,000
2) For executive type 1500 1500 22,50,000
11 PVC beading shoes for chair 1300 200 2,60,000
Powder coating compound kg kg
Total (per annum) 2,31,19,000
Total (per month) 19,26,000
 MARKETING POTENTIAL

The market demand for computer furniture is increasing day by day

with the increasing in use of the computers. Computer furniture has
got domestic as well export market. Long settling hours on
computers has necessitated the use of computer furniture such as
table and chair having proper dimensions and specifications
.computer tables are designed tin such a way so as to accommodate
monitor, CPU, keyboard and other peripherals etc. with the optimum
utilization of horizontal and vertical space. Care is also given to
provide sufficient leg space, free hand movement for operating
mouse etc. Care is also taken in designing and manufacturing
computer chairs to suit the computer table. Long sitting hours on
computer clubbed with improper spinal support on chair have
become the major cause for backache to many computer users.
Computer furniture manufacturers are bringing out innovative
changes to cope with this problem. Computer furniture is being
mainly used in offices, computer training institutes, laboratories,
schools, colleges and homes.

For the marketing, there is some instrument of marketing of the

product. This includes advertising, sales promotion, personal selling,
publicity, etc. We are marketing our product through the adverting in
newspaper, local TV channel and also published pamphlets.
 PRICING POLICY

Pricing is the only element in the marketing that create sales

revenue, the other element are costs.

- Philip Kotler

Pricing in the product is one of the important elements in marketing

mix. It is the most critical decision in marketing management so it is
said that “success or failure of business depends upon its product
price policy” a critical marketing tool namely pricing the amount that
consumers have to pay far the product, we have to decide whole
sales and retail price, discount allowance and credit terms. The term
objective of the pricing is to maximize profit for the concern but for
this object so muck stress should be laid on price but other non price
factor to increase the sales much as advertising sales promotion fair
distribution of goods quality of goods should also be considered.

Pricing policy of this firm is reasonable and with the competitors

price.
 PROMOTION

Promotion stands for the different activities which are taken by the
com make the product communication in target customer. Broadly
speaking promotion means to push forward or to advance an idea in
such a way as to gain its approved and acceptance. The main
functions of promotion is to forward a product, service or
distribution channel.

Promotion is responsible for working and stimulating consumer

demand for the product. It can create and stimulate the demand from
rivals and maintain demand for the product against competitions. The
promotion mix includes followings.

1. Advertising
2. Sales promotion
3. Sales force
4. Publicity
5. Direct marketing
6. Public relation

We will advertise our products in newspapers, Hoardings, kiosk,

Local TV Channels and pamphlets.
 MARKET SEGMENTATION

Market segmentation is an effort to increase company’s precision

marketing. The starting point of any segmentation discussion is mass
marketing. In mass marketing, the sellers engage in the mass
production, mass distribution and mass promotion of one product for
all buyers.

Segmentation is an approach midway between mass marketing and

individual marketing. Each segment’s buyers are assumed to be quite
similar in wants and needs, yet no two buyers are really alike.

The major segmentation variables geographic, demographic,

psychographic and behavioral segmentation.

Geographic Segmentation:
Geographic segmentation calls for dividing the market into different
geographical unit such as nations, states, regions, countries, cities
and neighborhoods. The company can operate in one or a few
geographic areas of operate in all but pay attention to local
variations.

Demographic Segmentation:
In demographic segmentation, the market is divided into groups on
the basis of variable such as age, family size, family life cycle,
gender, income occupation, education, religious, race generation,
nationality, social class. Demographic variables are the most popular
bases for distinguishing customer groups on reason is the customer
wants, preferences and usage rates are often associated with
demographic variables.
 Psychographic Segmentation:
In psychographic segmentation buyers are divided into different
groups on the basis of lifestyle on personality and values. People
within the same demographic group can exhibit very different
psychographic profiles it includes lifestyle, personality and values.

Behavioral Segmentation:
In behavioral segmentation, buyers are divided into groups on the
basis of their knowledge, of attitude towards use of or response to a
product. many marketers believe that behavioral variable occasions,
benefits, user status, usage rate, loyalty status buyer readiness stage
and attitude are the best starting points for constructing market
segments.
 FINANCIAL DETAILS

FIXED CAPITAL DETAILS

Land and building (on rental basis):

Description Amount
600 sq. mtrs. Of covered area @ Rs. 20 per sq. mtrs. Per 12000
month on rent (600 x 10)

Machinery and equipments:

Sr. Description Qty Amount

I Multi purpose wood working machine 1 45,000

II Hand operated screw press Nos. Arc welding 1 30,000

machine 300 AMP 18,000
Gas welding set 10,000
Pipe shearing Machine 4” size 20,000
Double ended bench grinder 6” 8,000
Flexible shaft grinder 6” wheel size 8,000
Bench drilling machine ¾ “ Cap. With motor 17,000
Portable drilling machine 7,000
Powder coating equipment 2,00,000
Air compressor 60,000
Paint baking oven temp 300 C , 8’ x 6 ‘ size 1,00,000
Phosphating plant 50,000
Total 5,73,000
Electrification and installation @ 10% of the 57,300
cost of machinery
Tools jigs fixtures etc. 10,000
Offices, furniture etc. 75,000
Total 7,15,300
III Pre operative exp. 30,000
 Total fixed capital (II + III) 7,45,300

Machinery Furniture Pre operative

 WORKING CAPITAL

Staff and Labor (per month):

Description No. Salary Amount

Manager 1 8,000 8,000
Accountant cum clerk 1 3,500 3,500
Skilled workers 4 3,000 12,000
Semiskilled workers 5 2,500 12,500
Unskilled workers/ peon 4 1,800 7,200
Total 43,200
Add 10% perks 4,320
Total 47,520

14000

12000

10000

8000

6000

4000

2000

0
Manager A ccountant Skilled Semi skilled Unskilled
Utilities (per month):

Description Amount
Electricity 13,500
Water 1,000
Total 14,500

Electricity Water

Other Contingent Expenses (per month):

Description Amount
Rent 12,000
Postage stationary 1,700
Telephone 2,000
Transportation charges 7,000
Advertisement and publicity 3,500
Insurance 1,000
Traveling exp. 4,000
Misc. expenses 5,000
Total 36,200
 Misc.

Travel

Insurance

A dvertise

Transport

Phone

Postage

Rent

0 2000 4000 6000 8000 10000 12000

Total Recurring Exp (per month):

Salaries 47,520
Raw material 19,26,000
Utilities 15,000
Other contingent exp 36,200
Total 20,24,720

2000000

1500000

1000000

500000

0
Salaries Raw Material Utilities Other
Total working capital:

2024720 x 3 months
= Rs. 6074160

Total Capital Investment:

Fixed capital Rs.745300

Working capital ( 3 months) Rs.6074160
Total Rs.6819460

Fixed Working
 SOURCES OF FINANCE

Project Cost:

Sr. Particular Total Own Borrowed

Contribution Contribution
For Fixed Assets
1 Machinery & 5,73,000 3,43,800 2,29,200
Equipments
2 Office furniture 75,000 45,000 30,000
3 Fixtures 10,000 6,000 4,000
4 Preoperative Exp. 30,000 18,000 12,000
Total 6,88,000 4,12,800 2,75,200
For Working Capital 50% 50%
Working Capital 60,74,160 36,44,496 2,42,664
(3 months) 30,37,080 30,37,080
Total Project Cost 67,62,160 40,57,296 27,04,864

Means of finance:

Particular Amount
For fixed assets
Term loan 4,12,800
Own contribution 1,55,200
Relatives contribution 1,20,000
For working capital
Term loan 30,37,080
Own contribution 20,37,080
Other contribution 10,00,000
Cost of Production (Per Annum):

Particular Amount
Total recurring cost 2,42,96,640
Depreciation on machines @ 10% 57,300
Depreciation on tools & fixtures etc @ 25% 2,500
Depreciation on office furniture equipments @ 20% 15,000
Interest on capital investment @ 16% 10,91,113
Interest on Borrowed Loan
On Fixed Capital 49,536
On Working Capital 3,64,449 4,13,985
Total 2,58,76,538

Turn Over:

1 Computer Table 1700 2250 38.25

Size 900 x 600 x 700 m
2 Computer cum printer table 1000 2600 26.00
Size 1200 x 700 x 750 m
3 Printer table 1800 1800 32.40
Size 750 x 700 x 750 mm
4 Computer chairs without arms 3800 1900 72.20
Size 725 x 725 x 950 - 1050 mm
5 Computer chairs with arms 3000 2100 63.00
Size 725 x 725 x 950 – 1050 mm
6 Executive computer chair 1500 3000 4500
Size 725 x 725 x 1100 – 1200 mm
Total 276.85
Net Profit:

= Turnover – cost of Production

= 276.85 – 258.76
= 18.09 lacks

Net Profit Ratio:

Net profit per year x 100

Turn over per year

18.09 x 100
276.85

6.53%

Rate of Return on Investment:

Net profit per year x 100

Total investment

18.09 x 100
68.19

26.53%
Break Even Point:

Particular Amount
Depreciation on machinery, furniture etc. 74,800
Rent of building 1,44,000
Interest on total investment 10,91,113
40% of salary & wages 2,28,096
40% of other contingent 1,13,360
Total 16,61,369

Break Even Point:

Fixed Cost x 100

Fixed Cost + Profit

16,61,369 x 100
16,61,369 + 18,09,000

16,61,369 x 100
3470369

47.87 %
 ADDRESS OF MACHINERY & RAW
MATERIAL SUPPLIERS:

1. M/s. Chandradeep Industries

SCO 32, G. S. Complex,
1st floor, Sangeet Cinema Road,
Ludhiana
2. M/s. Akal Industries
240, St. No. 3, Darmesh Nagar,
Nr. Campa Cola Chowk,
Ludhiana
3. M/s. A. P. Enterprise
40, New Kapur Nagar,
Sultanwind Road,
Amritsar – 143 006
Ph.: 2234099
4. M/s. Nightangle Products
Bachittan Nagar,
Nr. GNE, College, Gill Road,
Ludhiana
5. M/s. Welding & Tools Corporation
GT Road, Miller Ganj,
Nr. Overbridge,
Ludhiana
6. M/s. Kalgidhar Foundry & Agro Ind.
GT Road, Opp. Power House,
Mandi Gobinagar
7. M/s. Ajit Electro. Sales
9, Gurudwara Market,
Opp. Manager Cinema,
GT Road, Ludhiana
8. M/s. A. P. Engineering Works
42, New Kapoor Nagar,
Sultanwind Road,
Amritsar 143 006.
9. M/s. Guru Nanak Fabricators
3201, St. No. 2, New Janta Nagar,
Opp. Arora Palace, Ludhiana 141 003.
 RISK FACTORS

For inception of any activity, the risk factor is involved with itself.
Risk factor is likely living without being born. So, before starting
any organization or units the entrepreneurs have to keep in mind the
threatening feels of the firm.

The risk factors involved with “Apex Computer Furniture” may as

follows:

 The firm will have to face strong competition

 The promoters of the firm are not much experienced in the
field of entrepreneurship
 CONCLUSION

To end up the decision, since the starting of the project with the
selection of the “Apex Computer Furniture” for a new segment of
consumer with the greater potentially.

This is our pleasure to put this report before the university launching
the “Computer Furniture” As promoters of this unit, we have made
all the required efforts for the successful launching of all products,
we hope that the will be success in the market and specially my
brand, “Apex”. The main aim of us for launching this kind of product
is just to associate the society by providing best quality product.

Govt. should support these kinds of small scale units to serve the
public with qualitative items. we also want to help in generation of
employment opportunities and to raise standard of living.

At least we are again very thankful to all of the concerned people

who helped us in preparing this report. This is also true for us as we
thought our report could express our thought researches for Apex
computer furniture. It was a great experience that we might want to
deal in future. That’s all it will be great opportunity for every
student.