Final Report Shezan

University Of Central Punjab

Business plan SHEZAN

Made by?

Muhammad Amjad Abbasi

University Of Central Punjab PCIT

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Acknowledgement

We have the pearl of our eyes to admire blessing of the compassionate

and omnipotent because the words are bound, knowledge is limited

and time is short to express His dignity. It is one of the infinite

blessings of almighty ALLAH that He bestowed us with potential and

ability to complete the present training and make a material

contribution towards the deep oceans of knowledge.

First we avail this opportunity to bow our head before ALLAH almighty

in humility who given us the wisdom and perseverance for completing

this piece of report.

We invoke peace for Holy Prophet Muhammad (P.B.U.H) who is forever

torch. We feel highly privilege to ascribe the most and ever burning

flame of my gratitude and deep scene of devotion to the Prof. Irfan

Iqbal who taught us “business project” with heart and also gave a

guideline to this report.

JUNE 2009


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Table of Contents

Company Profile…………………………………………………………..7

Board of Directors……………………………………………………………….7

Audit Committee……………………………………………………………….7

Director & company Secretary……………………………………………….. 7

Auditors…………………………………………………………………………7

Chief Financial officer…………………………………………………………7

Legal Advisors…………………………………………………………………7


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Brief History …………………………………………………………….8

Vision & Mission Statement……………………………………………9

Product Range……………………………………………………………10

Local Consumer Products……………………………………………………

Exports…………………………………………………………………………

Process of

making……………………………………………………….

Fruit Juice - Production Process Flow…………………………………………

Fruit juice production process …………………………………………………

Packing……………………………………………………………………………

Storage…………………………………………………………………………..

Product Shelf life……………………………………………………………….

RAWMATERIAL REQUIREMENT…………………………………………………

Other Raw Material……………………………………………………….

TECHNOLOGY AND PROCESSES……………………………………………….

Machinery requirements…………………………………………………


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SECTOR & INDUSTRYANALYSIS………………………………………………

Sector Characteristics and overview………………………………….

Marketing Mix………………………………………………………….

Product ……………………………………………………………………

What Is "Product"? ……………………………………………………..

Nature of the product…………………………………………………..

Ingredients in Shezan Twist Juice (Product …………………………

Product Flavors Available……………………………………………..

The Target Market of the Product ……………………………………..

Competition of the Product

…………………………………………….

Direct ………………………………………………………………………….

Indirect Competitors…………………………………………………………

Shipping Units……………………………………………………………

Market and Positioning Of the

Product……………………………………….

Performance in the Market of the

Product……………………………………


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Pricing……………………………………………………………………

….

What Is "Price"?

…………………………………………………………………..

Pricing

Strategy………………………………………………………………….

Current Price……………………………………………………………………

Price Control…………………………………………………………………..

Pricing Objectives……………………………………………………………..

Factors Affecting the Price of Shezan Twist

juice…………………………

Differential Advantages the Company

Have………………………..

Placement …………………………………………………………………

The Channel of Distribution………………………………………………….

Distribution Strategy…………………………………………………………

Distribution Areas……………………………………………………………

Place for storage………………………………………………………………


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Demand increases……………………………………………………………

Logistics……………………………………………………………………….

Promotion…………………………………………………………………

Target Fragment………………………………………………………………….

Budget for Promotion…………………………………………………………..

Environmental Analysis……………………………………………………………….

The Company……………………………………………………………………

Suppliers………………………………………………………………………….

Customers…………………………………………………………………………

Competitors……………………………………………………………………….

Internal environment……………………………………………………………..

Internal environment…………………………………………………………….

Distributors……………………………………………………………………….


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BCG Matrices……………………………………………………………….

SWOT ANALYSIS…………………………………………………………

Conclusion………………………………………………………………

….

Recommendations……………………………………………………

……

Company’s Profile


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Brief HistoryShezan Company was incorporated on May 13, 1964 as a private

limited company, with the objectives as set out in the Memorandum of

Association in general and in particular to set up an industrial

understanding for manufacture of juices, squashes, sharbats, jams

pickles and preserves from fruits and vegetables

Nature has blessed Pakistan with an ideal climate for a wide range of

delicious fruits. Over the centuries Pakistani experts have acquired and

developed unique strains of exotic fruit varieties, unmatched for their

rich flavor and taste


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The Shahnawaz Group of Pakistan and Alliance Industrial Development

Corporation of U.S.A in1964 conceived Shezan International Limited as

a joint venture. The agriculture background of the Pakistani sponsors

induced them to establish this agro-based industry. Taking advantages

of abundance of fruits available in Pakistan, and the advanced

technology provided by the American partners, Shezan became

pioneers in the field of converting fruits into pulps, concentrates and

juices. Today Shezan is the largest food processing unit having

developed and installed the capacity to meet the country’s and export

needs.

In 1971 the Shahnawaz Group purchased all the shares of Alliance

Industrial Development Corporation with the permission of the Pakistan

Government. The Company has since shown sustained growth in both

the domestic and exports fields. The Company has been steadily

expanding its production capacity over the years. In 1980-81 a

separate unit was installed in Karachi which now caters for Karachi,

Sindh and export demand. A new bottle filling plant was set up in 1983

in Lahore unit increased the capacity five-fold. An independent Tetra

Brick Plant was commissioned in 1987 making us the leading

manufactures with comprehensive range of production in the fruit

processing field in Pakistan

Vision statement


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“To be known as leader of quality products in the

region. Dedication to quality is a way of life at our

company. In its activities the company will pursue

goals aimed at the achievement of profitable business

.these results will be derived from the dedicated

efforts of each employee in conjunction with

supportive participation from management at all

levels of the company .To pay its role in the economic

development of the country and to enhance quality of

life of its people”

Mission statement

“Our mission is to provide the highest quality fruit and

vegetable related juices and products to retail and

food services customers. We will accomplish this by


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maintaining a tradition of pride in our products,

growth through innovation, integrity in the

management of our business and commitment to

team management and quality improvement

process.”

Product Range

Shezan is producing a variety of quality products. Shezan is largely

considered as market leader in fruit and vegetable processing industry.

Shezan has an edge over other with its own fruit farms. Currently

Shezan is giving tough time to other fruit juice manufacturers due to

its quality and huge export volume as well as capturing local fruit juice

market where it has competition with Nestle and Haleeb.

Products can be divided into the following


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Local Consumer Products

Following are the major products that Shezan is producing currently:

1- All Pure

2- Juice Bottles


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Types of Products

Local Consumer Products Exports

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3- Regular Juices

4- Twist

5-Syrups 8-

Sauces

6 -NR-Bottles 9- Jams


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7-Vinegar 10- Quench

11- Squashes

12- Mango Nectar


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13-Pickles

13- Ispaghol

Exports


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Process of making

Fruit juice production procedures involved in fruit juice manufacturing.

Fruit Juice - Production Process Flow

Production of fruit juices is a standardized process and type of

technology depends on type of fruits and scale of operations. Initial

preparatory processes for all fruits will be similar, as will be the last

stages of juice/pasteurization section and packaging, although

differences in handling juice composition arise in certain cases due

to the nature of the fruit and percentage of pulp involved.

Basically, preparation process of Twist juices involves the following

steps:-

• Washing and cutting of fruits• Boiling of fruit pulp

I) Pulp Storage in Tank

II) Sugar Hopper

• Pulp and ingredients mixing • Syrup Storage in Tank• Juice Preparation• Juice Storage Tank • Filling and Packaging • Cooling and Storage


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Fruit Juice Production Process

After washing and cutting the fruit pulp is separated after that Pulp is

shifted to the boiler where it is cooked and shifted to the plate heat

exchanger. Pulp is then stored in the pulp storage tank. Pulp is then

supplied to the mixing tank in the desired quantity while in mixing

tanks; any additives to the pulp are made at this stage before it is

pumped to syrup storage tanks. Blended juice is then pumped through

pasteurizer; where it is heated to 90oC to inactivate enzymes and living

organism. After pasteurization the juice passes through final

filtration, before loading it into a juice storage tank. Juice from the

tank is ready for packaging

Packing

The juice will be then packed in the quantities 250ml. Packaging is

done on imported machinery as it considered being highly

sophisticated and hygienic

Machinery Used -Fruit Juice Filling & Packaging Line

S. No.

Machine CapacityLocal/Imported

1

Tetra Pak –TBA 19 7500 packs of 250 ml/ hr

Tetra Pak


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Storage

Products will be stored in cool dry store before distribution.

Product Shelf life

Twist Juice in 250ml serving packs have shelf life of less then 6 months.

RAWMATERIAL REQUIREMENT

Raw material required for manufacturing fruit juice are fruit pulp, citric acid, food color, sugar, preservatives and fruit flavors. Although, juice manufacturers use molasses to thicken the juice, this is not a good practice and therefore should be avoided. All raw materials are easily available in the local market, however, fruit pulp is considered to be the principal component of the high quality fruit juice, therefore, its continuous and within the required quantity availability will need some advance planning. Fruit pulp could be purchased from open market or directly from pulp producers, however, it would be safe to sign a contract or negotiate with a pulp producer to insure the availability of pulp before the commencement of production operations. Prices for the fruit pulp have been collected from the market and are given below:


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Other Raw MaterialThe ratio and utilization of other raw material depends on what percentage of pure juice the unit is going to produce; however, following are the main ingredients which will be required for the juice production proposed for this product.

Treated Water 75% Fruit Pulp 17% Sugar Citric Acid Fruit Flavor 8%-10% Preservative

Machinery required for the processing of fruit and juice packaging is available both local and imported. Local packaging machinery reportedly give poor quality output especially for fruit juice packaging which is considered to be highly sophisticated and hygienic; hence it could not be done by using local machinery. However, pulp processing and juice production could be done on locally fabricated machinery. Following machinery will be required for setting up a fruit juice plant:

Fruit Juice Pre-Packaging Production Line Fruit Juice Filling & Packaging Line Fruit Juice Cooling and Refrigeration Machinery


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MACHINERY REQUIREMENTFor the fruit juice production, packaging and storage both local and imported machinery can be used, however, for packaging it is proposed to use imported machinery rather than local machinery which is although a low cost option, yet do not provide good quality and quantity of output.


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SECTOR & INDUSTRYANALYSIS

SECTOR CHARACTERISTICS AND OVERVIEW

Agriculture sector highly depends on the weather circumstances. God has gifted Pakistan with several varieties of fruits and vegetables. Modern processing and packaging techniques make seasonal fruits and vegetables available all year round to almost all parts of the globe. Tropical fruit like mangoes can be enjoyed in temperate countries. Today, the world horticulture industry is a $77 billion market comprising of the following sub sectors.

Vegetables; fresh or preserved Fruits and nuts; fresh or preserved (excluding oil nuts) Fruit and vegetable juices (unfermented). Spices Bulbs, tubers, rhizomes of flowerings Cut flowers and foliage

Provincial fresh fruits production share is provided below:

Province % Share

Punjab 59.6


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Sindh 8.6

NWFP 6.2 Balochistan

25.6

Marketing Analysis Of

Shezan Twist juice

Product


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Marketing Mix

"Marketing Mix is the set of controllable tactical marketing tools

that are product, price, placement and promotion. The firm blends

these tools to produce the response it needs from the target market."


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Marketing Mix

Product Price Placement Promotion

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PRODUCT

What Is "Product"?

"Anything that can be offered to a market for attention,

acquisition, use or consumption that might satisfy a want or a need is a

product. It includes physical objects, services, persons, places,

organizations and ideas."

Shezan Twist

Comprising of a blend of different fruit juices,

shezan`s Twist juices open the door to a whole

new world of possibilities. Available in easy to

drink slim packing twist juices are a must have in

every household

Nature of the product


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Everyone has their own ideas about replacing essential body fluids,

vitamins and minerals - whether it's after exercise or just a tiring day

at the office. Fruit juice is still one of the best ways to replenish the

body's essential nutrients and it's a natural source of energy. Common

people especially young generation is inclined to have ready to

consume drinks; in addition hotels, hospitals are also expanding

day by day where juices could be marketed successfully.

Ingredients in Shezan Twist Juice (Product)

Energy 127 cal

Total Fat 0.0 gm

Proteins 0.15 gm

Total Carb 32.5 gm

Sodium 1.5 mg

Sugar 31 gm

Vitamin C 5.7 mg

Percent daily values are based on 2000 calorie diet


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Product Flavors Available

1-Apple

2- Raspberry,

3- Pineapple,

4-Fruit punch,

5-Mango Strawberry,

6-Mango

The Target Market of the Product

The target market of Shezan twist juice includes teenagers.

Basically they are targeting the students of schools, Colleges and

Universities.


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Competition of the Product

Direct

Indirect Competitors


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+

All other international brands. They Comprise 2% of total

market

Shipping Units

250 ml36 Packs per carton

(6*6 Wrapped Packing)

Market and Positioning Of the Product

The market is highly saturated in the drink, which are ready to

use

Performance in the Market of the Product

Brand Market Share

Nestle juice 45%

Country juice 5%


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Tropico Juice 18%

Shezan Twist juice 35%

International 02%

Pricing

What Is "Price"?

Price is the value placed on goods and services. Price is the

amount of money and /or goods needed to acquire some

combination of another and its accompanying services.

Pricing Strategy

Shezan when introduced twist juice in the market set the

price at Rs. 12/- while the competitive price was Rs. 10/-. This above

average price was due the better quality product and a new Juice

brand by a well knows Juice Company and Industry giant.

Current Price

The current price of one 250ml pack of Twist is Rs.15/-

When we purchase 3dozen of 250ml of Twist than the

price of this is Rs.468/-


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Available Size of Shezan Twist Juice

The Shezan Twist juice is available in only one size of 250 ml

Price Control

There are no price controls and this has happened after the introduction of local government system under the devolution plan. Companies are given free hand in charging enormously high prices for processed food items. They use little quantity of Fruit pulp in making the juice and charge very high price.


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Overall Distributor or Whole Seller Margin 07-10%

Retailer’s Margin 12-15%

Source Purchase Sale Price Profit


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Price

School, Colleges and

Universities 12 15 3

Whole Seller 12 12.90 .90

Retailer 12.90 15 2.10

Pricing Objectives

The objectives of Festival Juices for pricing Juice Products are as

follows:

1. To achieve a target return.

2. To maximize profit.


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3. Stabilize prices to meet competition.

4. Market share Leadership

5. Product Quality Leadership

Price Table with the Pure Competitor

Name of the Company Price Of the Juice

Nestle Juice Rs. 18/-

Shezan Twist Juice Rs. 15/-

Country juice Rs. 12/-

Tropico Juice Rs. 12/-

Factors Affecting the Price of Shezan Twist juice

The following are the some factors that are affecting the price of Shezan twist juice.

They are using the expensive technology

The transportation , roads are not in a good condition


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The un stable politicians, which have positive and negative effect

on the price

The labor cost is low in Pakistan as compare to the others

The advertisement is increasing the cost price of it but this is

necessary

Due to increase in taxes the price of them is also increased

They are using tetra packing which increase their cost

Differential Advantages the Company Have

The name of the Company

Very Large capital in whole company

The good reputation in the market

The combination of Flavors

Foreign technology , they are using

One of the oldest company in private sector

They have their own plant of tetra packing

PLACEMENT


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The distribution network includes the distributor then the wholesaler

and in the end the retailer. Again benefits are provided on the

achievement of the sales targets and timely delivery of products. In

some cases products are provided to big retailers by the distributor

itself but mostly it is being purchased by the retailer from the

wholesaler.

Distribution Strategy


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Through the heavy advertisement the distribution can be

affected because the distribution mainly depends upon the demand.

In the Shezan twist they are using the above channel fro distribution

the product

Some of people who wants to purchases very heavy amount

of the twist juice , they come to the company directly and buy

which is required

The whole seller are purchasing them for the resale able

purpose but less then the first once

They have Zonal offices in different areas such as Rawalpindi,

Lahore, Multan e.t.c to make it easy to sell

Distribution Areas

They are distributing in major cities such as:-

City Name Distributors

Lahore 200

Karachi 200

Islamabad 100

Total 500

Place for storage:-


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They have the stores to store the juice packets before the juice

goes for distribution

Demand increases

They always have the backup store juice to fulfill this demand

Logistics

To deliver the right quality and quantity of the twist juice,

they are working on the daily bases

They have large number of trucks to achieve all the things

according to their product

For distribution they are always have the future planning


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Promotion

Shezan is using following mediums for promotion of twist

Billboards

Television

Radio

Newspapers

Broachers

Internet


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They are doing these things according to the plans, for example

They now wants to advertise the product more through media

by using the famous people

For the promotion of the product they are giving the free

product in the start of the season

Large discount for the people who purchase the Shezan twist

juice directly from the company and in large amount

Giving free samples to the people who visit the company


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They are also arranging some charity shows in Karachi

They have given a very large amount to the people who suffers

form the earthquake in Pakistan

Stale operations are functioning in which they are giving the

free testing samples

There are spending a lot of money in the preparation of

mosques

There are giving free Translated Quran, which are in more than

150 languages

They are also working in a Islamic Jameet named Ahmediya

Target Fragment


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The target fragment for the product s the people using

juices instead of the soft drink like Coke and Pepsi

Budget for Promotion

A. Electric Media 75%

B. Printed media 25%

Environmental Analysis


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1)The Company:- The people in the company they are not working as a team

2)Suppliers:- Efficiency of the suppliers in the company is nice but

required more improvement

3)Customers:- The target market of the product is the teenagers mainly

4)Competitors:- Nestle is the pure competitors of the Shezan twist juice

5)Internal environment:- The internal environment is good but requires more

changes

6)Technological :- They are using the foreign technology which is their plus

point

7)Marketing:- Need to spend money field in marketing field

8)Distributors:- The distributors are in the Islamabad, Lahore, Karachi but

they are not handling the areas perfectly

BCG Matrices


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Shezan twist juice is the star product in the season and when the

season is of this becomes the Cash cow product/

SWOT ANALYSIS (ACCORDING TO THE

COMPANY)

Strengths

Conveniently placed factory

Pure and natural products

Qualified sales staff

Strong financial backup

Good distribution net work

Effective advertisement campaign

Weakness

Due to high rate of taxes our process are higher


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Tax evaders sell product on much less prices and retailers

blackmail for better profit margins

Opportunities

Expansion of distribution net work

Diversification of product

Addition of new varieties

Modification according to present requirement

Threats

Discount offered by competitors

Low quality food products on cheap prices

WTO

Less awareness of health

Nutritional facts of products with consumer

SWOT ANALYSIS (ACCORDING TO THE GROUP)


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Strengths

The Name of the company Shezan

One of the oldest company in private sector

Using foreign technology

The honest and determined employees

A global business

ISO certificated

They are using near to pure Ingredients

No complains on the quality

Weaknesses

Internal environment is not so good

Advertisement is weak

Distributors are not impressive

The sales manager have no much experience in this field

Product is promoting mainly in teenagers

Opportunities

They can introduce the Shezan twist in unready form


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By increasing the advertisement, possibly the sales will increase

They can introduce this in 1 Liter packing

More and new flavor can be introduced

They can introduce these twist juices in powder form

Threats

High taxes on them

They cant export without the permission of the Government

The Currency Value of the Pakistan is low

This product is seasonal

They are paying high taxes in exporting

Discount offered by the competitors

Conclusion


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According to our group mates after visiting the company and taking

information from the market we have concluded that:-

They are going good but have to improve internal environment

They have to improve their distributor sector.

They have to make new strategy for the competitors like Nestle

They have large capital , so they have to spend more money in the

advertising field

They have to introduce New flavor In the market

They can introduced these twist juices in 1 Liter packing

They can introduce these juices also in powder form.

Recommendations

As we have mentioned that Shezan needs to improve its

distribution strategy. Shezan is targeting youngsters as a potential

and big market for its twist juice so if company supply directly to

the schools, colleges and universities it removes intermediaries


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and due to high profit ratio café owners will promote Twist

compared to other juices.

Company Owned

Distribution House

Another important recommendation we want to give is this that

Shezan need to come up with a different kind of packing. Juice

packing with straw is not convenient for consumer as sometimes

juice fell when we insert straw and sometimes some juice still

remain in the pack that cannot come up with the straw. To resolve

this issue Shezan must introduce packing with cap on it in spite of

using straw. Quantity should be increased to 300ml and price

should be Rs. 20/-


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Schools

Colleges

Universities


Final Report Shezan

Documents

Transcript of Final Report Shezan