Without Which Your Food Is Incomplete

“WITHOUT WHICH YOUR FOOD IS INCOMPLETE”

A

FEASIBILITY REPORT

ON

SPICES

REPORT PRESENTED BY

GROUP - K

K.S.SCHOOL OF BUSINESS MANAGEMENT

GUJARAT UNIVERSITY,

AHMEDABAD-380009

CERTIFICATE

This is to certify that members ofgroup “K” of Third Year MBA of K.S.SCHOOL OF BUSINESS MANAGEMENT have successfully completedtheir feasibility report on SPICES for the Academic Year 2010-2011 and have duly submitted to the institute.

Date of submission: 10-3-2011

Project Guide :

Name: Ms.Ingita Jain

Sign :

K.S.SCHOOL OF BUSINESS MANAGEMENT

GUJARAT UNIVERSITY,

AHMEDABAD-380009

GROUP MEMBERS

INDEX

1. INTRODUCTION.

• What is feasibility report?
• History of spices.

1. PROJECT AT GLANCE.
2. ENVIRONMENTAL SCANNING.

• PEST analysis
• SWOT analysis
• Legal environment.

1. EVALUATION OF MARKET SEGMENT
2. LEGAL DOCUMENTS

• Memorandum of association.
• Article of association.
• Certificate of incorporation.

1. TECHNICAL FEASIBILITY

• Location analysis
• Process chart
• Process steps
• Plant and machinery description
• Machinery cost
• Technology selection
• Requirement of utilities
• Raw material description

1. HUMAN RESOURCE FEASIBILITY

• Manpower planning.
• Organization charts.
• Job description and specification
• Workers rights.
• Amenities to workers.

1. MARKETING FEASIBILITY.

• 4P’S of marketing.
• Vision.
• Market research.
• Objectives of conducting a survey.
• Questionnaire.
• Consumer analysis

1. FINANCIAL FEASIBILITY.

• Cost of project.
• Means of finance
• Land cost
• Building cost
• Plant and machinery cost
• Furniture
• Bank loan payment
• Raw material
• Depreciation
• Salary
• Factory o/h
• Office o/h
• S& D o/h
• Adm, O/H
• Installed Capacity Statement
• Cash flow statement
• Cost sheet
• P&L A/c
• BALANCE SHEET
• WC Requirement
• B-E-P Analysis
• Assumptions
• Ratio Analysis

1. EVALUATION OF PROJECT

• PBP
• NPV
• PI
• IRR
• ARR

1. CONCLUSION

• Estimate of future demand
• Bibliography
• Webography

AKNOWLEDGEMENT

We have made project report on feasibility study of SPICES in Third Year at K.S.SCHOOL OF BUSINESS MANAGEMENT and we are highly satisfied with the task of project work provided to us.

We are thankful to Dr. Sarla Achuthan, Director of K.S.SCHOOL OF BUSINESS MANAGEMENT

who gave us an opportunity of implying our creativity in such project work and applying theoritical knowledge into practical life.

We are also thankful to our project guide Ms.Ingita Jain,who has constantly motivated us to put our best in the project.

We would also like to thank all faculty members of K.S.SCHOOL OF BUSINESS MANAGEMENT for giving their valuable advice which made it possible for us to work efficiently.

It is not possible to express the name individually of each and every one who helped us but we would like to express our sincere gratitude to all group members.

PREFACE

MBA is a stepping stone to management career, in order to achieve practical, positive and concert result the classroom learning needs to be efficiently fitted to the realities and the situation. Existing outside the classroom which is in the market this is particular what we learn in the management.

Every study incomplete without having a well - planned and concrete exposure given to a student. Management studies are not exceptions. The study of management only as a theoretical knowledge is just like a wondering ship in ocean without a compass, so at this side it provides sound basis to adopt the theoretical knowledge and on the other hand it gives opportunity for exposes to real market situation. It gives us the basic practical experiences, which serve us a compass in the directionless ship; this enables the ship to reach its destination against all odds from all of its rivals.

So, in order to inquire them about management practice which require undergoing a project. This point is given to the students for having a first hand knowledge of business activities and ads to their existing stock of information.

INTRODUCTION

What is feasibility report?

A report which forecast or gives pre-estimation of venture with respect to different dimensions is called a feasibility report.

By feasibility we mean that the venture must be practically possible with respect to the following areas of management.

Industrial feasibility:

For manufacturing a product it is necessary for a manufacture to verify whether the industry concerned is feasible or not.

Financial feasibility:

It must assure a fair return on the capital invested by the owner.

Technical feasibility:

The technology required in the unit must be such that it is easily obtainable and practically feasible.

Marketing feasibility:

Just producing is not the end but the beginning. It should be accepted by the customers and the market.

Social feasibility:

It should not only believe from the above mentioned angles but it must also be secreting that it does not harm the society.

PROJECT AT GLANCE

Name of the Company: SUNRAJ SPICES PVT. LTD.

Product: SPICES

Factory address: Plot No. D 233/55,

Division-A,

Changodar GIDC,

Ahmedabad.

GUJARAT.

Constitution: Private Ltd

Cost of project: RS. 60,00,000

Means of finance: Owners Fund and Term Loan.

Payback period: 3years and 1/4month

Debt equity ratio: 77.91%

Current ratio: 2.24

HISTORY OF SPICES

The history of spice is almost as old as human civilisation.

It is a history of lands discovered, empires built and brought down, wars won and lost, treaties signed and flouted, flavours sought and offered, and the rise and fall of different religious practices and beliefs. Spices were among the most valuable items of trade in ancient and medieval times.

As long ago as 3500 BC the ancient Egyptians were using various spices for flavouring food, in cosmetics, and for embalming their dead. The use of spices spread through the Middle East to the eastern Mediterranean and Europe. Spices from China, Indonesia, India, and Ceylon (now Sri Lanka ) were originally transported overland by donkey or camel caravans. For almost 5000 years, Arab middlemen controlled the spice trade, until European explorers discovered a sea route to India and other spice producing countries in the East.

Spices were all imported from plantations in Asia and Africa, which made them extremely expensive. From the 8th until the 15th century, the Republic of Venice had the monopoly on spice trade with the Middle East, and along with it the neighboring Italian city-states. The trade made the region phenomenally rich. It has been estimated that around 1,000tons of pepper and 1,000tons of the other common spices were imported into Western Europe each year during the Late Middle Ages. The value of these goods was the equivalent of a yearly supply of grain for 1.5 million people. While pepper was the most common spice, the most exclusive was saffron, used as much for its vivid yellow-red color as for its flavor. Spices that have now fallen into some obscurity in European cuisine include grains of paradise, a relative of cardamom which almost entirely replaced pepper in late medieval north French cooking, long pepper, mace, spikenard, galangal and cubeb. A popular modern-day misconception is that medieval cooks used liberal amounts of spices, particularly black pepper, merely to disguise the taste of spoiled meat. However, a medieval feast was as much a culinary event as it was a display of the host's vast resources and generosity, and as most nobles had a wide selection of fresh or preserved meats, fish, or seafood to choose from, the use of ruinously expensive spices on cheap, rotting meat would have made little sense.

ENVIRONMENTAL SCANNING

BUSINESS ENVIRONMENT

Business environment is just like a human being. It cannot survive in alone; it is made for the people and of the people.

Managers have to perform their functions in the organization the system approach of managing suggests that an organization being a subsystem of brooder social system has to work within the frame work provided by the society and its various constituents. These constituents are combining to constitute environment for a given organization. Environment includes all the condition, circumstances, and influences, surrounding and affecting the total organization or any of its part.

Environment consists of atoms and molecules, agglomeration of thing in motion, alive of men and emotions of physical and social law, social ideas, norms of actions of forces and resistance their number is infinite and they are always present, they are always changing. For environmental analysis the following theoretical models are used.

• PEST Analysis

• SWOT Analysis

PEST Analysis

1.Political Environment:

Frequent changes in the central or state government lead to changes in industrial policies. This environment is composed of regulation, government spending and patent protection changes in the budget, subsidies, tax relief measures, tax structure and holidays, licensing policies may follow.

Here the political factor also the affect to the SPICES processing for its maintaining quality for industry of spices.

2.Economical Environment:

Economical environment plays very important for our product which is eco friendly and our product does not affect the environment.

3.Social Environment :

It reflects as what we are giving to the society and there is also the expectation of the society towards the business. We have pollution control certificate however, the general feature for pollution control must be taking into consideration during the process of manufacturing.

4. Technological Environment:

One of the most important aspects of shaping people’s lives is technology. The COMPANY which moves with the latest technology can excel their growth.

Every new technology is a force for creative destruction. Moreover the innovative process always leads to an increase in the investment. Technological invention is introduced for higher productivity lower cost, and more revenues. Technology refers to sum total of the knowledge providing ways to do things organization must give constant consideration to the manner in which innovation may affect their product and internal efficiency.

SWOT ANALYSIS

A SWOT Analysis is requiring checking the Company’s Strength, Weakness, Opportunities and Threats. It will give the overall idea about competitor and current situation of the Company. Strength and Weakness are the Company internal characteristic that can be improved by the Company while Opportunity and Threats are the external factors which will predict the current condition of the Company to make decision.

STRENGTH

 A Company’s strength is its resources and capabilities that can be used as a basis for developing and competitive advantage.

The increase in living standards of people, now they spend more on spices. As we are offering good quality at reasonable price so it will definitely attract customers so our venture is less risky.

Our Company offers the high quality.

Our target market is Gujarat which is one of the most developing states of India.

Gujarat is immerging as an industrial hub to many growing industries.

More and more investment means more industries, more housing and more construction.

All this is positive sign for the spices industry to prosper.

When we talk about spices, it has been found that following are its strengths.

There are many players it is like a perfect competition.

The labour does not require much specific qualification and skill.

The spices have got a very bright future and demand will remain constant through out the year.

WEAKNESSES

In the spices industry, the labour work on the part of workers is very tedious and laborious. Workers often complaint about the work load.

Since there are already big players in the market, we would have to face cut throat competition in order to get the market share,

Huge capital investment is requiring on the machineries.

OPPORTUNITIES

Gujarat which is one of the most developing states of India is emerging as an industrial hub with many growing industries like, fast malls, big buildings, residential expansion and more housing so future requirement of spices will be continuous.

Our research and survey so that people are interested in buying of the spices which is qualitative and at the same time something which is offered at a reasonable time. This thinking matches which our Company policy to produce the best at the least.

By using eco-friendly technology the unit may get an edge over the other players in the market

THREATS

 Competition, this is one of the biggest threats faced by all the business.

E Existence of big spices Company like RAMDEV pose tough competition for us.

SWOT MATRIX

LEGAL ENVIRONMENT

LAWS RELATING TO LABOURS:

Industrial dispute act, 1947

Industrial trade union act ,1926

Industrial relation act ,1946

Industrial employment act ( standing orders ), 1946

Workmen compensation act,1923

Payment of wages act,1936

EVALUATION AND SELECTION OF MARKET SEGMENTS

Among all the patterns of market segmentation, we fall under the category of homogeneous segment because there is no any noticeable different in the products of all the manufactures ofTermeric, Black Pepper, Chilly etc. Our customers preferences do not scatter throughout the space which indicates that customers do not vary greatly in their preferences so our brand hear the corner to attract a customers group that has not been satisfied with other brands.

While segmenting the market, we took the following steps.

1. We grouped the customers into segments based on their budget on spices and according to their quality and price preferences.

2. Determination of profitability of the segment finding unique customers and characteristics.

NAME:SUNRAJ SPICES PVT.LTD.

LOGO:

TAG LINE: “WITHOUT WHICH YOUR FOOD IS INCOMPLETE”.

LEGAL DOCUMENTS FOR PRIVATE LTD COMPANY

Memorandum of association.

Articles of association.

Certificate of incorporation of Company.

Memorandum of association of SUNRAJ SPICES PVT LTD. (Limited by shares as per section 15 of the companies act, 1956).

1. The name is SUNRAJ SPICES PVT LTD.

2. The registered office of the Company is situated in the state of Gujarat.

3. Objects of the Company:

a)Main object:

The main object of SUNRAJ SPICES PVT LTD is to manufacture spices to expand the production process for manufacturing spices in future or distribute in within India.

b)Other objects:

To enter into joint sector arrangement with any present body or corporate whether in India or abroad for the business of the Company.

To train and get trained and for pay training for the employee both present and future for and connection with business of the Company.

4.Capital clause:

It remains related to financial terms.

5. Liability clause:

The liability of the member is limited.

6. Association clause:

We the several persons whose names and address are satisfied are desire of being formed to companies in pursuable of this memorandum of association.

ARTICLES OF ASSOCIATION

1. SUNRAJ SPICES Pvt.Ltd. will follow the regulation contained in table a in the first schedule of the companies act, 1956.

2. No invitation shall be issued to subscribe for any share in or debenture of the companies.

3. Prohibited for from making any invitation for or acceptance from person other than its member directory of their relatives.

5.Copy of association clause

Our customers preferences do not scatter through out the space which indicates that customers do not vary greatly in their preferences so our brand hear the corner to attract a customer group that has not been satisfied with other brands.

CERTIFICATE OF INCORPORATION OF SUNRAJ SPICES PVT. LTD.

CERTIFICATE OF INCORPORATION

NO.01

I hear by certify that SUNRAJ SPICES PVT. LTD is incorporated under the companies act, 1956(No. 1of 1956) and that the Company is private ltd given under my hand at AHMEDABAD first day of APRIL, 2011.

SD/-

NAME______

Ass. Registrar of companies,

Seal of registrar of companies, Gujarat.

TECHNICAL FEASIBILITY

Introduction

Long term growth of business and profitability are the two basic requirements of any enterprise. In the modern era of globalization without the help of Technology Company can not survive any more. Higher productivity in a competitive situation can come only from relation and control of cost, which in turn comes from improved technology.

Now a day with the emergence of newer and faster technology, new innovation and technology advancement take place every now and then. In this kaleidoscopic era of competition for competing of other Company organization has to very well take care of its technology in order to meet the present emerging demands and modern requirements. Moreover, only the adoption any technology at one time cannot help the Company to survive any longer unless if does not implement it at the right time with the right intention and that too at the right place. To meet the competition more important beat the competition the companies have to upgrade their technology from time to time. The Company should be very innovative in implementing modern technology with proper care.

And that is what is being adopted at our organization with full consciousness. We are equipped with high technology oriented machineries, it help us to enhance the quality of our product.

LOCATION ANALYSIS

The Selection of location plays a vital role for the growth. We have decided to establish our production unit and marketing department in AHMEDABAD only.