Pen Industry

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					                                                    Acme Industries Ltd.
                            MSSI Project (FM Pens)
                                                                 - By Milind Gandhi

                                                     …the write way to listen.
                                                    Acme Industries Ltd.

                          A Project On

Product selected-

                       Ball Point Pens

Credited By-

                          S.Y.B.M.S. ‘A’

                  Aseem Agarwal                    ‘01’
                  Milind Gandhi                    ‘30’
                  Jigar Jain                       ‘37’
                  Rohan Joshi                      ‘41’
                  Pratik Mehta                     ‘53’

                                                  …the write way to listen.
                                                    Acme Industries Ltd.

                                   M/s ACME

                               PROJECT REPORT
                  SUBMITED TO BANK OF BARODA

(1)   NAME OF UNIT                   :       ACME

(2)   ADDRESS     : SALES OFFICE         :   5/247 Sunshine Colony,
                                                 Vapi - 56490,

                   FACTORY               :       5/432, Opp. Khanvel Resort,
                                                  Silvassa - 89047,
                                                  Dadra & Nagar Haveli UT

(3)   CONSTITUTION.                  :       PARTNERSHIP FIRM

(4)     DETAILS OF THE PARTNERS.                  :
        Sr. No.        Names                                Share of Profit
          1.            ASEEM AGRAWAL                            20%
          2.            MILIND GANDHI                            20%
          3.            JIGAR JAIN                               20%
          4.            PRATIK MEHTA                             20%
           5.           ROHAN JOSHI                              20%

(5)   PRODUCT                        :       Ball Point Pen Manufacturing.


(7)    SSI REGISTRATION NO.                  :        APPLIED FOR

(8)   SALES TAX REGISTRATION NO.             :        APPLIED FOR

                                                           …the write way to listen.
                                                    Acme Industries Ltd.
(9).    FINANCE REQUIREMENT.                          :   A    Term       Loan      of      Rs.

(10)    PURPOSE OF TERM LOAN.                         :Purchase of Plant & Machinery and
other fixed Assets worth Rs 5 Crores only.


                  PARTICULARS                 :                                   Rs.
        (I)     Plant & machinery :                                        55,00,000
        (II)    Other Fixed Assets    :                                    25,00,000
        (III)   Land & Building       :                                    2,00,00,000
        (IV)    Working Capital           :                                  60,50,000
        (V)     Misc. Expenses        :                                     1,59,50,000


(13)     PROPOSED TERM LOAN :                 RS. 5,00,00,000/-(Rs. 5 Crore)

(14)     REPAYMENT                            :       EMI OF RS. 15,00,000/-
                                              39 MONTHLY INSTALLMENTS

(15)     SECURITY                 :           Properties of the Partners

       NAME OF THE PARTNER                                      DETAILS
        ASEEM AGRAWAL                     : A/31, KESARKRUPA APT.,
                                                  NAPEAN SEA ROAD,
                                                  MARINE LINES,MUMBAI

        MILIND GANDHI                         :C/51, LILY APT,
                                                  S.F. ROAD,
                                                  MALBAR HILLS, MUMBAI

                                                                …the write way to listen.
                                                    Acme Industries Ltd.
         JIGAR JAIN              :         A/7, DAISY COMPLEX,
                                           J.V.P.D. SCHEME,
                                           PARLE(W), MUMBAI

           ROHAN JOSHI                 : D/17, RAHEJA TOWERS
                                           LOKHANDWALA COMPLEX
                                           ANDHERI(W), MUMBAI

         PRATIK MEHTA                  :    B/4, HILTON APT,
                                            NARIMAN POINT,
                                            MARINE LINES, MUMBAI

          TOTAL WORTH            :          APPROX. RS. 2. 5 CRORE.

         This project report relates to setting up an industrial unit for
manufacturing of “Ball Point Pens with special feature of Radio” due to
structural and other development use of Ball Point Pens is increasing day by
day. Ball Point Pens plays an important role in the gross national product(about
Rs 416 crore). Even in very advance countries like U.S. statistic proves that the
Pen Industry has a reasonable share in the gross national product. In a country
like India, where the rate of growth of industrial sector has to be accelerated in
order to meet the needs & aspirations of the people, the important role that
Pens Industry plays cannot be over emphasized

         The applicant unit is a Partnership Firm registered with Registrar of the
Partnership Act, Maharashtra under Reg. No. 1183503/2004. The Company is
consisting of 5 Partners who are well experienced & resourceful to carry out
the project.      The names & other details of The Partners are mentioned
elsewhere in this project report.
         We intend to take non-agricultural industrial plot of land admeasuring
about 3000 sq. Ft. on Lease for Factory Being plot Block no. 5/432, Silvassa-
89047 in the union territory of Dadra Nagar Haveli.           and 2000 sq. Ft. Sales

                                                       …the write way to listen.
                                                    Acme Industries Ltd.
Office in 5/247 Sunshine Colony, M.G. Road, in Vapi. The Cost of the same is
Rs. 2,00,00,000/- including cost of land & other charges.

      The site selected for manufacturing of welding electrode is selected at
Silvassa as it is a well developed industrial area & has all the required facilities.
It is connected by rail &road transport. There is a frequent train connections &
continues approach by national highway No. 8 & it is only a few Kms away from
Vapi . We have selected Silvassa only because the industrial & economic
development in this area is increasing day by day. The development of various
industrial zones and being easily accessible by the business centre it would be
great help in setting up and operating the project. The infrastructure facility
are also easily available.     Our requirement of Power, electricity, water ,raw
material are easily available. Being situated in a Union Territory its has its own
tax advantage.

POWER :       Power is easily available in Silvassa. We have applied for N.O.C. from
the Regional Authority for providing the required power connection.

WATER : We required about 500 ltrs. Of water per day for general purpose. We
have borring facility to be provided.

RAW MATERIAL : The raw material required in the product manufacturing like
wire steel rodes, E.Q. wires, Flux , etc. which is readily available in domestic

LABOUR : Both in Vapi(Sales Office) & Silvassa (Factory), there is no problem in
getting the required skilled & unskilled labour. It is easily available in the area.


We are manufacturing ball point pens on labour job basis this purpose we have to
purchase injunction Moulding machines ( the list of which is given in the project
report). During the process of manufacture Vergin Plastic granules i.e. polypropylene,
Acrylic High Density, Polistrine etc. as require are kept in the hooper through which
the granules passes to the heating system, by the various devices fitted in the
Automatic Injunction Moulding Machine, Plastic articles comes out from the mould.

                                                       …the write way to listen.
                                                    Acme Industries Ltd.

The raw materials are easily available in the open market i.e. from the dealer of
Reliance Petrochemical, Supreme Industries and also from large market of
import of I.P.C.L. Baroda.


      We, in different accounts, are dealing with your bank since last more then
15 years. Our past        track record is with your bank regarding our financial
discipline in repayment of various loans obtained by our unit and its sister
concern and the partners of the same in their individual capacity also. We have
been assisted by you for various individual car loans of partners, office /
computer loans, and presently the Ball Point Pen project. We have our track
record of completion all the term loan by repaying the same in time. Now again
we seek your support and assistance for expansion of the project and prosper
more with your support.

            PARTICULARS          :                              Rs.
      (I)      Plant & machinery :                              55,00,000
      (II)     Other Fixed Assets    :                          25,00,000
      (VI)     Land & Building       :                          2,00,00,000
      (VII)    Working Capital                                   60,50,000
      (VIII) Misc. Expenses           :                          1,59,50,000

               We require Plant & Machinery as per list attached for our
      manufacturing and assembling processes and totally will have to incur Rs.
      55,00,000/- . It will include Plant & Machinery like Plastic Injection
      Moulding Machine( 30 H.P. & 15 H.P.), Grinder, Cooler, Mixer,
      Compressor and Assembler.

ii)    LAND & BUILDING :

                                                     …the write way to listen.
                                                         Acme Industries Ltd.
                   To start with we have to put the project with bare minimum
            requirement in order to minimize the initial fixed cost and thereby
            keeping the very low equilibrium point. The Factory Building will be
            constructed in Silvassa with a flexibility of meeting additional demand
            and additional production requirement, & also to have good R & D
            department and Physical & Chemical Laboratory. In case we have to
            expand the factory shed, an additional rooms for storage capacity and
            putting additional plant & machinery. We also have planned to purchase
            sales office in Vapi. The area of the same is expected to be around 1000-
            2000 sq. ft. The total cost in construction of is calculated to approx. Rs.
            2,00,00,000/- (which includes Engineer, Architecture’s fees and other
            kind of labour fees)

     iii)   FURNITURE & FIXTURE :
                   We also have to incurs expenditure of Rs. 25,00,000/- on furniture
            & fixture like Partner’s, Manager’s Cabin with table & filing cupboard etc.
            the list of the same is given.

            The unit is presently consisting of five partners. Mr. Rohan Joshi, Mr.
     Pratik Mehta, Mr. Jigar Jain, Mr. Milind Gandhi and Mr. Aseem Agarwal. The
     personal Bio-data of the respective partners is given as under.

           The given C.V. is just a sample showing the kind of C.V. generally submitted in
     the feasibility report. It’s drawn on the basis of the reference given by experienced


     Mr. Partner
     Happy Home II, B/Wing/502,
     J.V.P.D. Scheme, Parle(West),
     Mumbai 400 015

                                                          …the write way to listen.
                                                    Acme Industries Ltd.
Contact Number: 9812465347

                                                  …the write way to listen.
DATE OF BIRTH      : July 21, 1972 – Mumbai

University of Mumbai Bachelor’s Degree of commerce – March’ 94

 Proficient in Typing & Shorthand with a speed of 40/120w.p.m
 Well-conversant with handling office automation equipments like Photocopier
   & PC.
 P C Literate – Knowledge of popular word-processing, graphic presentation
   pacakages like MS Office, WS, Power Point and Internet.

To find a challenging and satisfying position commensurate with my educational
background and provide an opportunity for a career growth.

Loyal, Hardworking, Confident in work, Responsible, Efficient

Personal Details
Nationality             : Indian
Language Known          : English, Hindi, Marathi, Konkani
Marital Status          : Yes
No. of Children         : One
Hobbies                 : Playing Hockey & Listening to Music
I hereby declare that all the information by myself is true and to the best
of my knowledge.
                                                                    Thanking You,
                                                                   Your's faithfully

                                                      …the write way to listen.
Technical Characteristics of Acme FaMe®:

This is how the pen will look like from inside. The design of the pen will be a
little bulky. But that is understood considering the fact that the pen has an
inbuilt FM Radio. However, we are constantly trying to upgrade the design of
the pen to make it a little lighter. The FM will be operational only when the
refill is in the pen. Hence, the users will have to purchase a new refill once it
is over to enjoy the FM. This is because there will be a wire going through
the ink in the refill, our ink being a good conductor of ink. The FM will also
need two button cells or batteries. Overall it is a very unique and safe
design. Enough experiments and research have been carried out to ensure
that the concept of Acme FaMe® is viable and safe for consumption.

The internal small features of the pen, which are numbered and encircled,
are described as under:

1. Pen open/close:

                                                         …the write way to listen.
is is the enlarged diagram of the open/close mechanism of the pen. This
shows how the nib of the pen pops out and how does it get in. This pen
does not have the traditional push-back button. Rather this pen has two
buttons, as shown above, the left one being to open the pen and the right
one being to close it. Now, as it is shown above the pen is closed. Once, the
left button is pressed, it will push the lever upwards and because of the
shape of the base part of the lever, it will push the plank attached to the
lever to the right side and hence, the refill will be pushed ahead. Thus, the
support in the middle will hold the left indent of the lever and hence, it will
stay in that position. Similarly, once, the pen is open and the right button is
pressed, again the lever will be pushed upwards thus releasing the left
indent of the lever from the support in the middle and as a result, the lever
will be as in the position shown above. This is how the open/close
mechanism of the pen works.

2. Refill:

This diagram shows the magnified version of the refill. The refill will be filled
to 90% of its capacity. One of the two wires will pass through the refill. The
ink used will be a good conductor of electricity. It means that the ink will

                                                         …the write way to listen.
enable free flow of electricity through it. Once the ink is used or the ink is
about to get over, there is a deliberate break in the wire. This will cause the
electricity to stop. This will, hence, cause the FM Radio to be dysfunctional.
Hence, basically the user will have to purchase the refill even if he/she wants
to only listen to FM Radio. This will enable us to increase the usage rate of
our product, which in turn might lead to brand loyalty. Hence, the refill of
the pen is designed in such a manner that it facilitates re-purchase of the

3. Head-phone inlet:

This is how the pen will look like from behind (back view). It will contain the
inlet for the head-phone. Once, the head-phone will be inserted in the inlet,
the user will have to then roll the volume on/off button for the FM to be
functional. The technical concept of the FM Radio will be the same as it is
available. There will be a scan button which will bring the different radio
stations of FM.

This is how the pen will look from outside. Here, the color of the pen is navy
blue and the rest is silver color. Part of it will be transparent (refill).

                                                             …the write way to listen.

“In Rome, do as Romans” is a wise saying and it has always stood the test of
time. So is in our case, in the age of plastic lets talk plastic. The reason for
ACME INDUSTRIES LTD. coming with a product in plastic industry or ball
pens to be microscopic may bring ambivalent reactions on the faces of
many. Our competitor’s faces will be red hot while consumers rest assured
of their delightness. It is caveat seller and caveat competitore.

But this is no reason for us to cheer as this pen industry also follows the 80-
20 rule. The rule as it goes, 80% of production of pens comes from the 20%
of whole industry. The area we target is very difficult to say as going behind
the small companies will give ample time to our competitor to grab our hard
earned market share but if directly pounce on big players it can result to our
loss as still economies of scale and economies of scope benefits are reaped
by them. So it is almost similar to walking on a double edged sword.

But promoters of ACME are hard guys to deal with. Before entering the
market we have decided to know all the ground realities as they are. But at
core we know that our innovation- FaMe will stand to its name for us.

To start with the compilation of our competitors there is wide range of
offering by the companies. Starting from MNCs like PARKER-HANNIFINN
INC., SHAEFFER to companies like CELLO, MONTEX, and TODAYS. These all
companies offer an arena of pens starting from price band of Rs.5 but with
exception to MNCs. They all cater to lower class as well as middle class and
on. The labyrinth of pen industry and stow analysis for our company is given
as follows:

Major competitors:
      is registered is the largest company operating in our industry. The
      company enjoys around 15-25% of market share and is also able to
      sustain the growth rate with ease. This company forms the spearhead
      of pen industry. Its plant at Goregoan, Mumbai alone contributes
                                                         …the write way to listen.
     around 400000 units to its production per day compared our 100000
     units in entire month.
  2) The production as well sales graph of Montex for the year ended
     2003-04 in graph is given by:

                      (Amount in crores) in units.)

           Quarters Production Sales                       (in Exports          Quarters              Production
                               (in Rs.)         Rs.)            (in Rs.)        Q1                    1 crore
           Q1                  20               35              8               Q2                    90 lakhs
           Q2                  18               34              9               Q3                    1 crore
           Q3                  22               32              6               Q4                    1.2 crore
           Q4                  26               38              10

                                          Montex prod.,sales & exports.




      Rs. in crores

                                                                                     Production (in Rs.)
                      20                                                             Sales (in Rs.)
                                                                                     Exports (in Rs.)



                             Q1            Q2              Q3              Q4


                                                                                …the write way to listen.
With massive figures like these ACME has decided to target opponents

Most of the company’s sales worked out of the cheap pens which costs
around Rs.5-Rs.10 which made a brisk business of Rs.15 crores in quarter 1,
while premium market products which costs a staggering rock bottom with

The strategy to counter attack major players, ACME has placed its products
at moderate range of Rs.25-Rs.30. with an operational cost of Rs.15-Rs.17
per unit the market accepting our product stands at an impressive 0.32. This
means that of 100 pens sold within the price band of Rs.25-Rs.40, 32 pens
will be of ACME. The only mantra for success here is moderate pricing, low
cost plus good quality, `PEN WITH FM` WILL BE INSTANT HIT.

The strategy to counterattack local players is again our moderate pricing.
Since local players also cater to lower and middle class with product ranging
anywhere from Rs.2-Rs.7. Generally the pricing slot here is our main
concern as quality provided is worth. Consumer’s value for money index is
quite high for our product while local players fail to notice this.
So here our market positioning will play an important role. Low class
consumers should not mistake our product in premium category. Here
generally Rural marketing with extensive advertising campaigns can act as a
cash cow to our business. Our rural marketing campaign “JO LIKHEGA WHO
GANA GAYEGA.” is all set to be launch with much hyped publicity, for
GOERNMENT OF GUJARAT will be extending almost 50% of campaign cost, so
as to increase the literacy rate. In a way our product encourages literacy
amongst rural masses of India, especially in Gujarat.

Amongst local players our main competitors are companies like CAMAY
which serves only in Maharashtra.

                                                          …the write way to listen.
                                                                              (Amount in Crores.)
Quarters                                    Production                  Sales
Q1                                          4                           4.5
Q2                                          3.2                         4
Q3                                          4.1                         3.9
Q4                                          4.1                         4

Initially it will be very difficult to uproot even small players but as it can be
seen small players don’t have enough profit to survive upon.

                                                   Camay Prod.,Sales




              Amount in Crores





                                       Q1         Q2              Q3   Q4

                                                                            …the write way to listen.
                     THE PROCESS COSTING GUIDE.

                       Comparative Production Costs
                         For A Typical Component


  1. Rotational moulding using very simple equipment
  2. Rotational moulding using sophisticated equipment

                                                      …the write way to listen.

        Here, is the list of Raw Materials required in the Manufacturing Process
and some of its distinct Characteristics which helps to get our Final Product.
   1) Styrene Acrilonitrile (SAN).
   2) Acrilonitrile Butadiene Styrene(ABS)
   3) Polycarbonate(PC)
   4) Polypropylene (PP)
   5) General Purpose Polystyrene(GPPS)
   6) Radio/F.M. Chips

FM Chips
        F.M. Chips will be our main Raw Material as our whole concept of
Innovation is based on this only chip. These chips will be outsourced from
China os from favourable local market whichever is better. These chips will
be very similar to those in Radio and F.M. that we get.
        These chips will be our main Raw Material as the future of our success
depends on the success of these chips. If these chips fails to perform as
expected our product will fail in market. These chips will cover almost half
of the cost of the total Raw Material required for our final product, ACME

Styrene Acrilonitrile SAN
SAN, which is used as the predecessor is a hard rigid transparent material
. It is easily colored, it is also resistant to thermal shock and has a good
chemical resistance. It is rigid, transparent, tough, resistant to greases,
stress cracking and crazing, easily processed, resistant to food stains. All
these characteristics make SAN
 It’s main advantage as a Raw Material for our Pen is that it is available in a
range of colors and can be tailored for specific applications. A variety of
grades are available for different applications, the material is typically
injection moulding or extrusion.

Applications of SANS (Reasons for its Usage)
                                                          …the write way to listen.
The pleasing appearance especially when colored and the ease of printing on
SAN has facilitate in manufacturing of pens.
SAN is also hard wearing and is used in the office and in industry for diverse
applications, all types of outer covers, e.g. printers, calculators, instruments
and lamps. Other applications include scales, battery housings, winding
cores, writing and drawing equipment and cylindrical impellers for air-
Acrilonitrile Butadiene Styrene (ABS)
ABS is an ideal material wherever superlative surface quality, colorfastness
and luster are required.           ABS standard grades have been developed
specifically     to   meet   the   requirements   of   major   customers.    Fiber
reinforcement can be incorporated to increase stiffness and dimensional
stability.     ABS is readily blended or alloyed with other polymers further
increasing the range of properties available. The natural material is an
opaque ivory color and is readily colored with pigments or dyes.
Transparent grades are also available. A variety of grades are available for
different applications, the material is typically injection moulded or
Because of its good balance of properties, toughness/strength/temperature
resistance coupled with its ease of molding and high quality surface finish,
ABS has a very wide range of applications. Because of the ability to tailor
grades to the property requirements of the application and the availability of
electro platable grades ABS is used in manufacturing of pens.
Polycarbonate (PC)
It’s main characteristics include Transparency, excellent toughness, thermal
stability and a very good dimensional stability make Polycarbonate (PC) one
of the most widely used engineering thermoplastics. Polycarbonate remains
one of the fastest growing engineering plastics in pen industry.
Polycarbonates are strong, stiff, hard, tough, transparent engineering
thermoplastics. Polycarbonate is available in a number of different grades
dependent on the application and chosen processing method. The material
is available in a variety of grades such as film, flame retardant, reinforced
and stress crack resistant, branched (for applications requiring high melt
strength) and other speciality grades. Also blends of PC are available with
                                                          …the write way to listen.
e.g. ABS or Polyesters, widely used in automotive industry. Processing of PC
generally falls into:
      Injection Moulding
      Structural Foam Moulding
      Extrusion
      Vacuum Forming
      Blow Moulding
Polypropylene (PP)
Polypropylene is one of those most versatile polymers available with
applications, both as a plastic and as a fiber, in virtually all of the plastics
end-use markets. It is (Semi-rigid, translucent, good chemical resistance,
tough, good fatigue resistance, integral hinge property, good heat
PP does not present stress-cracking problems and offers excellent electrical
and chemical resistance at higher temperatures. While the properties of PP
are similar to those of Polyethylene, there are specific differences.

Polystyrene (General Purpose) GPPS
It is Brittle, rigid, transparent, low shrinkage, low cost, excellent X-ray
resistance, free from odor and taste, easy to process. It’s characteristics and
application are same as the above Raw Materials

                                                         …the write way to listen.
                       HUMAN RESOURCE MANAGEMENT

Definition of job analysis
Job analysis is the process of studying and collecting information relating to
the operations and responsibilities of a specific job. The immediate products
of this analysis are job descriptions and job specifications.

Definition of job design
It integrates work content (tasks, functions, relationships), the rewards
(extrinsic and intrinsic) and the qualification required (skills, knowledge,
abilities) for each job in a way that meets the need of employees and the
Thus job design involves 3 steps:
1. The specification of individual tasks
2. The specification of the methods of performing each task.
3. The combination of tasks into specific jobs to be assigned to individuals.


The job analysis in ACME is done on certain pre-conditioned norms. The job
to be done by each and every employee in the organization is fixed there is a
certain process that they have to follow. We identify the job positions and
set manuals that confirm to certain standards. Depending on the current
market demand they may upgrade or change the process.
Eg: Traditionally the marketing manager’s job related to marketing activities
only. But off late they have multi-dimensional. They also need to have some
finance background so they can find new ways of reducing the cost and
increasing the profits of the company.

The illustrated format of job design followed at ACME is as follows:
   Job Identification Data – Job title, work unit, pay grade, etc.
   Job Summary – Functions, responsibilities, general standard of duties.
   Job duties – Tasks and responsibilities associated with the job.
   Job specific – It can be prepared on the basis of specific jobs.
                                                           …the write way to listen.
   Physical make-up - Health, physique, appearance, speed.
   Attainment – Education and other qualification, experience, etc.
   General intelligence – Fundamental intelligence, intellectual capacity.
   Specific aptitudes – Mechanical, manual dexterity, facility in the use of
    figures or words.
   Interests – Intellectual, practical, constructional, physically active, social,
   Disposition   –   Acceptability,   influence,   dependability   over    others,
    steadiness, self-reliance.
   Circumstances – Domestic circumstances, occupations of family.

The following specifics for the post of higher level management are
   Innate abilities – Natural quickness of comprehension and aptitude for
   Motivation – the kinds of goals set by the industries, his or her
    consistency and      determination in following them up and success in
    achieving them.
   Adjustment – Emotional stability, ability to stand up stress and ability to
    get along with peopl

                                                           …the write way to listen.
                              KG     AMOUNT(R.S)          TOTAL(RS)         TOTAL(RS)
SAN                           500        125                    62500
POLYCARBONATE                 500        225                  112500
A.B.S                         250         80                    20000
POLYPROPLENE                  250         80                    20000
DULRENE                       125        120                    15000
OTHERS                                                          30000

                                                                260000             260000
                            UNITS    AMOUNT(R.S)
F.M FROM CHINA              100000           9                  900000             900000

LABOUR                         8           2000                  16000              16000

SALARIES                       2           8000                  16000              16000

CARRAIGE                                                          4000               4000

MARKETING                                                       250000             250000

OTHER                                                            66335              66335

SUNDRY                                                           16500              16500

ELECTRICITY                                                      16000              16000


COST OF ONE PEN=1544835/100000=15.50(APPROX)


                                                                …the write way to listen.

 A       Plant & Machinery :

No.      Details of Plant & Machinery      NOS    Amount (Rs.)

  1      Plastin Fully Automatic Plastic    1         1,500,000
         injection Moulding Machine of
         1000 gms. capacity - 30 HP

  2      Plastin Fully Automatic Plastic    1         1,000,000
         injection Moulding Machine of
         500 gms. capacity - 15 HP

  3      Grinder - 5 HP                     1          40,000

  4      Cooler - 3 HP                      1          20,000

  5      Mixer - 3 HP                       1          20,000

  6      Compressure - 5 HP                 1          20,000

  7      Assembler                          1          1900000

  8      Refil,cap                          2          1000000

                                                        …the write way to listen.

Total Value of Plant & Machinery                                   5,500,000

  B    Cash in hand                                                6,050,000
       Land and Building                                           20000000
       Fixed assets                                                  2500000
       Materials                                                    11300000
       Marketing                                                     3000000
       Wages                                                          200000
       Factory insurance                                              200000
       Carraige                                                        50000
       Other                                                          200000
       Sundry exp                                                     200000
       Electricity                                                    200000
       Salaries                                                       200000
       Maintenace                                                      75000
       Legal exp                                                       75000
       Audit fees                                                      75000
       Office maintenace                                               75000
       Machinery maintenace                                           100000

TOTAL COST OF THE PROJECT                                         50,000,000


BANK LOAN                                                        50,000,000

                                                     …the write way to listen.


                          M/S ACME
                               BALANCE SHEET
      PARTICULARS                 AMOUNT(R.S)     PARTICULARS     AMOUNT(R.S)
TO OPENING STOCK                              BY SALES                25000000

TO PURCHASES                                 14000000

TO WAGES                                        200000

TO FACTORY INSURANCE                            200000

TO CARRAIGE                                      50000

TO GROSS PROFIT C\D                          13950000    BY CLOSING STOCK            3400000

                    TOTAL                   28400000     TOTAL                      28400000
PARTICULARS                              AMOUNT(R.S)     PARTICULARS           AMOUNT(R.S)
TO MARKETING                                 3000000     BY GROSS PROFIT          13950000

                                                              …the write way to listen.

TO OTHER EXP                              200000

TO SUNDRY EXP                             200000

TO ELECTRICITY                            200000

TO SALARIES                               200000

TO MAINTENCE                               75000

TO LEGAL EXP                               75000

TO AUDIT FEES                              75000

TO OFFICE MAINTENECE                       75000

TO MACHINERY MAINTENACE                   100000

LOAN                                     3650338

TO NET PROFIT                            6099662
                 TOTAL                  13950000                  TOTAL       13950000

                      BALANCE SHEET AS ON 31ST DECEMBER 2005
PARTICULARS                          AMOUNT(R.S) PARTICULARS              AMOUNT(R.S)
CAPITAL                        -                  MACHINERY                   5500000

NET PROFIT                  6099662      6099662   LAND AND BUILDING          20000000

BANK LOAN                  50000000                FIXED ASSETS                2500000

INTEREST                    3650338                CASH IN HAND                7300000

INSTALLMENT                )16500000    37150338   CLOSING STOCK               3400000

                                                   BANK OF BARODA              4550000
                                                   (A\C 4209211)

                                                         …the write way to listen.
                     TOTAL                     43250000                    TOTAL     43250000


                                M/S ACME
                                REPAYMENT OF LOAN & INTEREST STATEMENT

RS.               5,000,000
INT. RATE             @09%

Monthly Inst.      1,500,000

     DATE           DEBIT                            CREDIT                          BALANCE

   31-Jan-05                -             -                                         50,000,000

   28-Feb-05       1,500,000         375,000                                        48,875,000

   31-Mar-05       1,500,000         366,563                                        47,741,563

   30-Apr-05       1,500,000         358,062                                        46,599,624

   31-May-05       1,500,000         349,497                                        45,449,121

   30-Jun-05       1,500,000         340,868                                        44,289,990

   31-Jul-05       1,500,000         332,175                                        43,122,165

   31-Aug-05       1,500,000         323,416                                        41,945,581

   30-Sep-05       1,500,000         314,592                                        40,760,173

                                                                …the write way to listen.
10-Oct-05    1,500,000      305,701                                   39,565,874

30-Nov-05    1,500,000      296,744                                   38,362,618

31-Dec-05    1,500,000      287,720                                   37,150,338

31-Jan-06    1,500,000      278,628                                   35,928,965

28-Feb-06    1,500,000      269,467                                   34,698,433

31-Mar-06    1,500,000      260,238                                   33,458,671

30-Apr-06    1,500,000      250,940                                   32,209,611

31-May-06    1,500,000      241,572                                   30,951,183

30-Jun-06    1,500,000      232,134                                   29,683,317

31-Jul-06    1,500,000      222,625                                   28,405,942

31-Aug-06    1,500,000      213,045                                   27,118,986

30-Sep-06    1,500,000      203,392                                   25,822,379

10-Oct-06    1,500,000      193,668                                   24,516,046

30-Nov-06    1,500,000      183,870                                   23,199,917

31-Dec-06    1,500,000      173,999                                   21,873,916

31-Jan-07    1,500,000      164,054                                   20,537,971

28-Feb-07    1,500,000      154,035                                   19,192,005

31-Mar-07    1,500,000      143,940                                   17,835,945

30-Apr-07    1,500,000      133,770                                   16,469,715

31-May-07    1,500,000      123,523                                   15,093,238

30-Jun-07    1,500,000      113,199                                   13,706,437

31-Jul-07    1,500,000      102,798                                   12,309,235

31-Aug-07    1,500,000       92,319                                   10,901,555

30-Sep-07    1,500,000       81,762                                   9,483,316

10-Oct-07    1,500,000       71,125                                   8,054,441

30-Nov-07    1,500,000       60,408                                   6,614,850

31-Dec-07    1,500,000       49,611                                   5,164,461

31-Jan-07    1,500,000       38,733                                   3,703,194

                                                  …the write way to listen.
   31-Dec-07     1,500,000         27,774                                2,230,968

   31-Jan-08     1,500,000         16,732                                747,701

   28-Feb-08     753,308            5,608                                            -

                             MARKETING PLAN

      We will be operating in two types of industries i.e. the F.M.(Radio)
industry and the Ball pen industry.

Radio Industry

       The radio industry is not much developed and organized as compared
to the Ball Pen Industry. The Radio now a days is considered to a
complimentary feature. People don’t buy Radio for it’s sole purpose, they
buy it for multiple purpose. Rather we could say that people now a days
would like to prefer products with Radio as an additional feature but
wouldn’t purchase it individually. And if consumers are purchasing it they
would prefer the cheaper unbranded products in this category. Hence do to
the above market scenario as well as development of technology & the
competitive industries(walkman, mobiles, CD-player. etc) which provide as a
complimentary or additional feature, the Radio industry has lost its market
share in the last couple of years. Now there are very few or we could say
none who produce only branded radio. The Major share in the radio industry
is hold by the unbranded cheap products in this category & by the Chinese
F.M. product which are available at the local prices and sometimes even
cheaper than the local brand.

      All the above mentioned factors of the Radio industry and the current
market scenario has proved that it could be one of the lucrative industry
bearing some aspects in mind( like a branded Radio given with some kind of
innovative feature at competitive price without compromising on the quality

                                                     …the write way to listen.
Ball Pen Industry

      Pen Industry in India has developed a lot in the past one decade. And
at present, Product-wise, the overall market in India is worth Rs 800-crore
market, 52 per cent comes from ball-point pens sale, 33 per cent from
liquid ink pens, and the remaining market share is accounted for by
markers, sketch pens, etc. The leading competitors in          Ball Point Pen
Industry would be Mitsubishi, Pilot, Cello, Montex.

      Imports are also seem to flowing in the Ball Pen Industry through tie-
ups/ collaborations & outsourcing.

        E.g. Flair Pens and Kanpur-based Rotomac Pens Ltd have floated a
new company called Indo Japan Pen Manufacturing Company Pvt Ltd for
manufacturing and marketing the Japanese range of pens, Pentel, in India.
For starters, four Pentel products will be introduced in the Indian market. Of
these, two pens are targeted at the upper-segment consisting of business
executives and professionals: the Technica-X, is a double-push ball pen
priced at Rs 110, while the Tradio is a fountain pen with a plastic nib priced
at Rs 120. Both these will be made available at 35,000 retail outlets in
metros and mini-metros. The other two pens are mass-market pens
targeted at students: the Rs 17 Clic-ball is a ball-point pen which uses the
side-slider system. While the Hyper is a ball-point pen with a transparent

                                                       …the write way to listen.
cap and a rubber grip. It is priced at Rs 15. These two pens will be Pentel
flagship brands reaching out to 115,000 retail outlets.

       However, there is no consistency on either the price front or the
quality front. The traders do not have much faith in these imports. If some
traders take huge orders they are able to bargain a good deal. This brings
down the price further. The next consignment enters at a cheaper rate and
most traders get caught with previous stock at a higher price. This
inconsistency has resulted in traders losing faith in such imports. This is
where we might have an advantage.

     But many big companies like Camlin & Montex are not interested in
such kind of tie-ups. Rather they prefer to outsource some of the
components and sell it under its own Brand Name

E.G. Camlin Pens are sourcing a lot of products from China, Korea and Japan,
sometimes in the semi-finished form or component form. They then market
it under the Camlin brand name. This helps them to expand the product
range. In China they have entered into an agreement with a few companies
to supply us gel pens, ball pens and mechanical pencils. The components
are sourced from different parts of the world including India.

                           LOCATION OF BUSINESS
The location refers to a particular area or site place selected for establishing
a business unit. The profitability and the performance of a business unit are
very much influenced by the location, size of business, and the layout. The
location and environmental factors are nowadays-prime consideration for
the establishment of a business unit.

The location of a business unit can decide the earning capacity and the cost
control. It is the location, which can decide whether the business will be
stable or otherwise. The maximum convenience, minimum cost and the

                                                          …the write way to listen.
optimum efficiency are usually the guiding factors in deciding upon the
location of a business unit.

So    taking    this   into   consideration   we   have    decided     to   setup   our
manufacturing plant or factory at Silvassat, Dadra & Nagar Haveli and sales
office at Vapi, Gujarat due to various reasons.

Some of the reasons for the same are as follows:
Since the plant will be located in a Union Territory and it as a major
manufacturing hub so we will get readily available cheap labor for our
production processes at our factory. Even the quality and skill of labor will
be comparably better than other regions.

As the factory is located on the border of Gujarat and Maharashtra in
Silvassa the transport facilities are very good and readily available at cheap
rates.   Even     communication      infrastructure   is   excellent    due    to   the
concenteration of various industries in the area.

The plant being located on the border of Maharashtra and Gujarat will help
us in catering to the large and major markets of these two states. So our
costs in delivering and other expenses will get reduced. These two states are
one of the most advanced and sophisticated. So this will be an added benefit
to sell our product and garner market share.

Silvassa, Dadra & Nagar Haveli is an Union Territory, so various tax benefits
and exemptions are in place out there. There is less tax on various
commodities and goods and even the business has to pay less income tax.
Some industries are given a tax holiday. Sales tax, octroi, excise, customs
etc duties are also very less.

                                                             …the write way to listen.
Even raw materials can be bought cheaply and quickly as suppliers are based
nearby. Even the imported raw materials can be brought in cheaply as less
import duty is applicable in this region.

Cheap power will be available as Reliance is setting up an electric power
plant of 11000KW in the area. So due to this electricity will be highly
subsidized. Employment generation will also take place due to this and bring
skilled labor into the region.

After the business is settled and growing the company will have the
opportunity to expand if needed as the area is an industrial hub and there is
scope for expansion.

The company will be able to make more profits, as there will be reduction in
transportation and fuel, power costs. Even marketing costs will decrease as
the major markets are nearby. Administrative costs will also go down as
cheap labor will be available and many people will not be required.

The area has many financial institutions & this will help in various things
such as banking & insurance. Loans & other documents for trade can be
cleared & got quickly.


  The government has reserved some 836 products especially for the
small-scale sector. Large and medium sized industries are not permitted to
manufacture these items.

                                                       …the write way to listen.
  The government always needs to purchase various items for their own
consumption. The government has therefore set 400 items to be purchased
only from the small scale Sector. About 75% of the things required by the
government are reserved for small-Scale sector.

  Financial institutions give loans to small sale sector at a lower rate of
interest. Govt. Gives assistance by way of seed money and loans at lower
rate of interest to this Sector. State govt. also grants subsidies to this sector
under its corporation scheme of Incentives. This is always higher than large
and medium sized industries. Govt. grants land on concessional rental basis
or on lease to the small-scale industries. Bank of Baroda is providing us the
loan amount to start our business venture at a low rate of interest.

  Industrial units have been setup in various states so as to encourage and
enable the SSI Units to commence their production at a earlier stage. They
also provide all the Facilities required by the SSI to manufacture it goods.
Land is also available at a Cheaper rate to all start-ups.

  Various state electricity boards give concessions and share part of the
expenditure on Electricity for the units that require less than 100 H.P. load
for their industry. Electricity is also supplied at a cheaper rate in some cases.

  Special concessions have been granted to SSI units for import of raw
material and Machineries required for the industry. Cheaper rate of duty is
charged for imports.

  SSI units concessions in paying Income tax, concessions in depreciation,
capital Investment in their profits etc. are available to SSI units.
                                                           …the write way to listen.
Details of Personnel

1) Management Personnel
   A) Milind (Inventory & Logistics)

He will be looking after the inventory and logistics in the factory located at
Silvassa. His main duty will be to see that the right amount of raw materials
are there and also the quantity of finished is as per schedule or not so that it
can be dispatched. In logistics he will see to that the raw materials and
finished goods have reached the factory and sales office respectively. As he
is a promoter he will get a share in the profits arising.

   B) Aseem (Production Manager)

His main duty and responsibility is to see to that the required amount of
goods is produced on time. He will also have to check whether the raw
materials received are of good quality or not. Instructions and directions to
workers will also be given by him to work on the machine. He has vast
experience in the technical field and being an engineer has been chosen to
be the production head. Being a promoter he will get a share of the profits

   C) Pratik (Purchase & Sales Manager)

Being experienced in this field he will look after the purchase of raw
materials from the suppliers from various areas and other countries. He has
to see that the raw materials are supplied on time and are of the right
specification given. In sales contacting potential customers and maintaining
relations with existing ones will be his main priority. As he is a promoter he
will get a share in the profits arising.

   D) Rohan (Marketing Manager)

Being a promoter will get a share of the profits arising. He will be looking
after the marketing aspects of the product. Meeting new people and
                                                            …the write way to listen.
explaining and convincing them about our product will be his doing. He will
also look out for new avenues for marketing our product in an unusual and
different way. He will be in contact with radio, newspaper and magazine
people so as to publicize our product.

   E) Jigar (Finance Head)

He will be looking after the finance of the company. The day to day
expenses are kept within the required range will be his responsibility.
Keeping track of funds required and spent I which field or account will also
be taken care by him. The balance sheet and other financial documents are
going to be prepared by him. Being a promoter he will get a share in the
profits arising.

2) Non-Management Personnel
      1) Workers

There will a total of 13 workers in our company. Out of which 10 will be
working in the Silvassa Factory looking after the production aspect on the
machines. Their other duties will include loading and unloading of material
and finished goods from the machines. The remaining 3 workers will be
working at the Vapi sales office looking after the sales. Their main duty will
be to keep a check on warehousing and stock of goods. They will also help
in loading and unloading of materials for the purpose of sales. The salary
and wages of the workers will be around RS2500/-per month.

                                                       …the write way to listen.

                            SILVASSA PLANT

             MILIND                               ASEEM
          (INVENTORY &                          (PRODUCTION
            LOGISTICS)                           MANAGER)

          SUPERVISORS                           SUPERVISORS

            WORKERS                              WORKERS

                            VAPI SALES OFFICE

       PRATIK                       ROHAN                    JIGAR
    (PURCHASE &                  (MARKETING                (FINANCE
  SALES MANAGER)                  MANAGER)                   HEAD)

     WORKERS                       WORKERS                 WORKERS

Our distribution network:

      Our main markets or the target group of audiences will be
predominantly, from the two states of Gujarat and Maharashtra. Distribution

                                                          …the write way to listen.
 forms an integral part of the marketing plan of any organization. Thus, we
 will have our distributors located in cities and towns of these two states. The
 distributors are then responsible for all the dealers and subsequent sellers.
 We will be keeping a track of the sales performances of all these
 distributors. The number of distributors and their location is given below.

I. Gujarat:
  Gujarat, being one of the bigger states of India, is a very good market for
  our pen. In the state of Gujarat, emphasis will be on rural and semi-urban
  marketing. Following is the break up of the distributors present in the
  respective cities/towns:

 1. Surat: Surat is one of the popular towns in south Gujarat. It has the
    distinction of being one of the cleanest cities of Gujarat. Following is the
    list of distributors in Surat:
         A. K. Enterprises

                                                         …the write way to listen.
        Jai Shree Krishna Distributors Pvt. Ltd.
        Mehta & Sons
        Shah Corporation

 2. Vadodra: Vadodra also known as Baroda is one of the fastest developing
    cities in Gujarat. The distributors in Vadodra are:
        Gandhi Bros.
        Kumar Enterprises
        Apex Distributors
        A-One Dealers and Wholesalers

 3. Ahmadabad: Ahmadabad is virtually the second capital of Gujarat. It
    holds the distinction of having Gujarat’s only international airport. The
    distributors here are:
        SMS Distribution Services Pvt. Ltd.
        Reliable Dealers
        Royal Distributors
        Empire Services Pvt. Ltd.

 4. Rajkot: Rajkot is situated in a convenient location and hence, distribution
    from here becomes very easy. Distributors here are:
        G. M. Services Pvt. Ltd.
        Kirti Marketing
        Smart Distribution Company

 5. Bhuj: Bhuj is located at the western part of the state. Sensing the
    potential market of west Gujarat, we have our distributors here.
        Bhuj Marketing Services Pvt. Ltd.
        Mohanlal and Sons.
        Raheja Agency
I. Maharashtra: Maharashtra is one of the fastest growing states of India.
    With the presence of many big companies the market here is potentially

                                                          …the write way to listen.
1. Mumbai: Mumbai the city of dreams. Mumbai is a very important market
  for us since the people here are willing to pay for quality. The distributors
  here are:
     Supreme Distributors
     Bombay Enterprises Pvt. Ltd.
     Anand Marketing Agency
     Hilton Group

2. Pune: Pune is the second biggest market we are targeting after Mumbai.
  The dealers list in Pune are:
     Golden Companies Pvt. Ltd.
     Bhogle & Sons.
     Dynasty Group of Companies
     M. S. Distributors

                                                        …the write way to listen.
 3. Nagpur: Nagpur, the city of oranges, is located at east Maharashtra. The
     distributors list here are:
        Bhushan Agency
        Pinnacle Industries
        Sawan Distributors
        A. R. Distributors Pvt. Ltd.

 4. Auranagbad: Aurangabad is situated in central Maharashtra and hence
     the dealer location will be widespread.
        Saran Agency
        Abdul Marketing
        Lifeline Company Ltd.

 5. Kolhapur: Kolhapur, being situated in the south will cover the southern
     towns of Maharashtra. The distributors here are:
        Dewan Centre for Marketing
        Divine Marketers
        Dyewood Group of Dealers

         All the distributors that are listed above including both Gujarat and
 Maharashtra are not the final dealers or the pen. We (Acme) have assigned
 these distributors to locate the dealers for our pen. Hence, these are not the
 final link to the consumers. The performance of the dealers will not be
 looked after by us but by these distributors themselves.
         Thus through this extensive, distribution coverage we will try to make
 our pen available at every town and cities of these two states.

 SWOT Analysis of Acme:

I. Strengths:
    Innovation: The concept of a pen with FM Radio is an innovation in itself.
     This concept is very unique and hence, is our strength. With an innovative

                                                         …the write way to listen.
      product, we can enjoy the benefits of being the only producers of FM
      pens in India.
     Under Utilization: The machines will not be used to full capacity. Thus the
      under utilization of machines will result in the scope for further
      expansion and hence less of capital expenditure required.
     Patented: The product will be patented and hence, we will enjoy the
      benefits of a monopoly in producing FM pens.
     Off shoring: The FM’s that are being attached in the pens will be coming
      from China. Thus, we will be enjoying the benefits of off shoring and it
      will create a favorable image in the minds of the customers.
     Low cost: The FM Pens will be sold by us for Rs.25 only. Hence, compared
      to other players in the market, we will be providing a pen with a FM Radio
      which will make it cheaper.

II. Weakness:
     Limited Capital: We, being Small Scale in size, will fall short of capital.
      Due to the nature of our company, there is always the problem of lack of
      appropriate funds.
     Inflexibility: Because of the limited working capital and limited assets,
      there is always the problem of lack of flexibility. If a major player in the
      market comes up with a similar product, then we might not be able to
      adapt to the conditions.

III. Opportunities:
     Return on Investment is high: Because of the nature of the product, we
      can enjoy return on the investments. The company will not take long in
      achieving profits because of the high return on investment.
     Payback minimum: Because the capital requirement is low and the fact
      that the funds are recovered at a quicker rate, the payback period in case
      of the loan taken from the bank will be low.

IV. Threats:
     Change in tastes and preferences: The tastes and preferences of the
      customers are ever changing. Thus if the craze of FM Radios starts to go
      down then our pen will not be preferred by many people.
                                                           …the write way to listen.
   Change in China market: Since we are off shoring the FM’s from China,
    there is a threat that if there is some problems in the China markets then
    it will directly affect us.

       This is the SWOT Analysis with which we will try and find a solution so
as to increase our strengths and opportunities and essentially decrease our
threats and weaknesses.


          Do you know the write way to listen?

                   Introducing Acme FaMe®
                                                       …the write way to listen.
First time in India, a ball point pen with an
               inbuilt FM Radio

                           ….the write way to listen

A Quality Product by Acme Industries Pvt. Ltd.

Interested Dealers Contact Immediately– (02638) 2839044

                                    HAPPY ENDING

Finally, let us conclude in a humorous manner. Ball point pen was the
product that we had chosen long back. But what we really thought hard on
was that extra thing to be given with the pen. We had gone through a lot of
options before finally selecting FM as being that extra thing to be given with
the pen. Following is the list of things that we thought should be considered.
You might find some very interesting:

   Pen with torch light
       (Already exists we wanted something new)
   Pen with camera
       (Will not be allowed in colleges)
   Pen with a paint brush
       (Sounds strange)
   Pen with built in MP3 player
       (Very futuristic thinking)
   Pen with stand
       (Understood it? We didn’t)
   Pen with a screw driver
       (Bad one)
   Pen with burglar alarm
                                                       …the write way to listen.
       (What optimistic thinking)
   Pen with a knife
       (We leave this one to you)
   Pen with remote control
       (Hold it carefully, you will press a button)
   Pen with thermometer
       (Sick!!!!!!!!!!! We need this)
   Pen with reusable refill
       (We changed the definition of refill)

This proves what brainstorming can do (…after last nights drink). Among all
these which one did you like the most? Please do tell us.

                                                       …the write way to listen.