Kamyab Jawan Youth Entrepreneurship Scheme Pre …

Kamyab Jawan

Youth Entrepreneurship Scheme

Pre-Feasibility Study

Bakery and Confectionery

Small and Medium Enterprises Development Authority

Ministry of Industries & Production Government of Pakistan

www.smeda.org.pk

HEAD OFFICE

4th Floor, Building No. 3, Aiwan-e-Iqbal Complex, Egerton Road,

Lahore

Tel: (92 42) 111 111 456, Fax: (92 42) 36304926-7

[email protected]

REGIONAL OFFICE

Punjab

REGIONAL OFFICE

Sindh

REGIONAL OFFICE

Khyber Pakhtunkhwa

REGIONAL OFFICE

Balochistan

3rd Floor, Building No. 3,

Aiwan-e-Iqbal Complex,

Egerton Road Lahore,

Tel: (042) 111-111-456

Fax: (042) 36304926-7 [email protected]

5th Floor, Bahria

Complex II, M.T. Khan Road,

Karachi.

Tel: (021) 111-111-456

Fax: (021) 35610572 [email protected]

Ground Floor

State Life Building

The Mall, Peshawar.

Tel: (091) 111-111-456


Bungalow No. 15-A

Chaman Housing Scheme

Airport Road, Quetta.

Tel: (081) 2831623, 2831702


http://www.smeda.org.pk/

mailto:[email protected]





Pre-feasibility Study Bakery and Confectionery

TABLE OF CONTENTS

1 DISCLAIMER ........................................................................................................... 2

2 PURPOSE OF THE DOCUMENT ............................................................................ 3

3 INTRODUCTION TO SMEDA .................................................................................. 3

4 INTRODUCTION TO SCHEME ................................................................................ 4

5 EXECUTIVE SUMMARY ......................................................................................... 4

6 BRIEF DESCRIPTION OF PROJECT & PRODUCT ................................................ 4

7 CRITICAL FACTORS .............................................................................................. 5

8 INSTALLED & OPERATIONAL CAPACITIES ........................................................ 5

9 POTENTIAL TARGET MARKET ............................................................................. 5

10 PROJECT COST SUMMARY .............................................................................. 6

10.1 Project Economics ............................................................................................ 6

10.2 Project Financing .............................................................................................. 7

10.3 Project Cost ...................................................................................................... 7

10.4 Space Requirement .......................................................................................... 8

10.5 Machinery and Equipment Requirements .......................................................... 8

10.6 Furniture & Fixtures and Other Equipment ........................................................ 9

10.7 Raw Material Requirements .............................................................................. 9

10.8 Human Resource Requirement ....................................................................... 10

10.9 Revenue Generation ....................................................................................... 10

10.10 Utilities and Other Costs .............................................................................. 11

11 CONTACT DETAILS OF EXPERTS & CONSULTANTS ................................... 11

12 ANNEXURES ..................................................................................................... 12

12.1 Income Statement ........................................................................................... 12

12.2 Statement of Cash Flow .................................................................................. 13

12.3 Balance Sheet ................................................................................................. 14

12.4 Useful Project Management Tips .................................................................... 15

12.5 Useful Links .................................................................................................... 16

13 KEY ASSUMPTION ........................................................................................... 17

13.1 Raw Material Assumptions .............................................................................. 17

13.2 Sales Assumptions .......................................................................................... 24


Small and Medium Enterprises Development Authority (SMEDA) 2

1 DISCLAIMER

This information memorandum is to introduce the subject matter and provide a

general idea and information on the subject. Although, the material included in

this document is based on data / information gathered from various reliable

sources; however, it is based upon certain assumptions which may differ from

case to case. The information has been provided on ‘as is where is’ basis without

any warranties or assertions as to the correctness or soundness thereof.

Although, due care and diligence has been taken to compile this document, the

contained information may vary due to any change in any of the concerned

factors, and the actual results may differ substantially from the presented

information. SMEDA, its employees or agents do not assume any liability for any

financial or other loss resulting from this memorandum in consequence of

undertaking this activity. The contained information does not preclude any further

professional advice. The prospective user of this memorandum is encouraged to

carry out additional diligence and gather any information which is necessary for

making an informed decision; including taking professional advice from a

qualified consultant / technical expert before taking any decision to act upon the

information.

In case the document is intended to be used for loan application under any

specified loan scheme, respective scheme parameters are to be incorporated

accordingly. In doing so, financial results may vary from results shown in this

document.

For more information on services offered by SMEDA, please contact our website:

www.smeda.org.pk



2 PURPOSE OF THE DOCUMENT

The objective of the pre-feasibility study is primarily to facilitate potential

entrepreneurs in project identification for investment. The project pre-feasibility

may form the basis of an important investment decision and in order to serve this

objective, the document / study covers various aspects of project concept

development, start-up, production, marketing, finance and business

management.

The purpose of this document is to facilitate potential investors in Bakery and

Confectionery Business by providing them a general understanding of the

business with the intention of supporting potential investors in crucial investment

decisions.

The need to come up with pre-feasibility reports for undocumented or minimally

documented sectors attains greater imminence as the research that precedes

such reports reveal certain thumb rules; best practices developed by existing

enterprises by trial and error, and certain industrial norms that become a guiding

source regarding various aspects of business set-up and it’s successful

management.

Apart from carefully studying the whole document one must consider critical

aspects provided later on, which form basis of any Investment Decision.

3 INTRODUCTION TO SMEDA

The Small and Medium Enterprises Development Authority (SMEDA) was

established in October 1998 with an objective to provide fresh impetus to the

economy through development of Small and Medium Enterprises (SMEs).

With a mission "to assist in employment generation and value addition to the

national income, through development of the SME sector, by helping increase

the number, scale and competitiveness of SMEs", SMEDA has carried out

‘sectoral research’ to identify policy, access to finance, business development

services, strategic initiatives and institutional collaboration and networking

initiatives.

Preparation and dissemination of pre-feasibility studies in key areas of

investment has been a hallmark of SME facilitation by SMEDA.

Concurrent to the pre-feasibility studies, a broad spectrum of business

development services is also offered to the SMEs by SMEDA. These services

include identification of experts and consultants and delivery of need based

capacity building programs of different types in addition to business guidance

through help desk services.



4 INTRODUCTION TO SCHEME

Prime Minister’s ‘Kamyab Jawan – Youth Entrepreneurship Scheme’, for young

entrepreneurs between the age group of 21 - 45 years, is designed to provide

subsidized financing through the National Bank of Pakistan, Bank of Punjab and

Bank of Khyber under the guidance and supervision of the State Bank of

Pakistan.

The loans will be disbursed to SME beneficiaries across Pakistan, covering;

Punjab, Sindh, Khyber Pakhtunkhwa, Balochistan, Gilgit Baltistan and Azad

Jammu & Kashmir. The Program aims to provide 25% of the loans to women

entrepreneurs.

Loans provided through Kamyab Jawan Program are segregated in two tiers:

Tier 1 loans fall in the range of Rs. 100,000 to Rs. 500,000, with Debt:Equity

90:10 and 6% markup to borrower, and, Tier 2 loans are from Rs. 500,000 to Rs.

5 Million, with Debt:Equity 80:20 and 8% markup to borrower. Both loans are for

a period of upto 8 years with a grace period of 1 year.

Application forms are available both in branches and dedicated websites of

National Bank of Pakistan, Bank of Punjab and Bank of Khyber.

5 EXECUTIVE SUMMARY

Bakery and Confectionery business is growing in both urban and semi-urban

areas. This pre-feasibility study encompasses bakery businesses located in

commercial neighborhoods surrounded by middle income residential localities.

Major products include cakes, snacks, sweets, nimko, biscuits, bread and

general confectionery items, which will be sold to target customers of the vicinity.

The sales outlet will be supported by an in-house production facility. Selection of

adequate product mix and business location, supported by marketing efforts are

critical success factors.

This Bakery & Confectionery business will be started as sole proprietorship with

an investment of Rs. 3.61 million which includes a capital cost of Rs 2.51 million

and working capital of Rs 1.09 million. This project is based on 80% debt and

20% equity ratio. Projected NPV, IRR and Payback of this project are Rs. 11.00

million 45% and 3.01 years respectively. The business will provide employment

opportunity to 10 individuals including the owner manager.



6 BRIEF DESCRIPTION OF PROJECT & PRODUCT

The proposed Bakery and Confectionery shop is a small scale project with a

production area and sales out-let. It will be equipped with basic machinery and

fixtures. The production area will require 2,700 sqft and the outlet will be

established on 675 sq.ft. The sales outlet will remain open for business for 16

hours per day round the year.

Product mix will include cakes, snacks, sweets, nimko, biscuits, bread and

general confectionery items. This merchandise will be prepared and acquired

according to the demand of local customers and in quantities directly proportional

to expected sales.

Maximum sales are expected during Eid seasons and in winters. First year

revenues of the project are estimated to be Rs 16.27 million. It is expected that

production growth rate will be 5% per annum along with 10% per annum increase

in sales price.

7 CRITICAL FACTORS

Background knowledge and experience of the entrepreneur in the bakery

business.

Induction of trained human resource for production of requisite items.

Maintenance of quality and hygiene standards.

Pricing strategy & understanding requirements of the target customers.

Decor presentation and layout of the shop and products.

Location considerations for easy access of the customers.

8 INSTALLED & OPERATIONAL CAPACITIES

The installed capacity of bakery depends on the variety of the products being

produced. Installed capacity of major production items is cakes 23,785 pounds,

40,470 pieces of snacks, 6,035 kgs of sweets and nimko, and 5,325 kgs of mixed

biscuits. Apart from this, general items (i.e Spices, Ketchup, Shampoos,

Perfumes, Beverages, etc.) will also be sold in the bakery which is assumed to

be 30% of the bakery sales, each year.

Starting capacity utilization is 70% of the installed capacity growing at the rate of

5% per annum.



9 POTENTIAL TARGET MARKET

Areas having presence of middle-income groups in the smaller cities will be an

ideal location for opening sales outlet of the business. Ideally, production facility

of the workshop should be located alongside the sales outlet; however, if the

rental costs are a constraint, production facility can be established at a distant

economical location. In such a case, higher transportation costs may need to be

factored in.

Smaller cities with growing middle income group such as Sargodha,

Sheikhupura, Gujrat, Sukkur, Hyderabad, Nowshehra, Charsadda, Quetta,

Khuzdar and Gilgit are some of the prospective cities for setting up this business.

10 PROJECT COST SUMMARY

A detailed financial model has been developed to analyze the commercial

viability of Bakery and Confectionery business under the ‘Prime Minister’s

‘Kamyab Jawan – Youth Entrepreneurship Scheme’. Various cost and revenue

related assumptions along with results of the analysis are outlined in this section.

The projected Income Statement, Cash Flow Statement and Balance Sheet are

attached as annexures.

10.1 Project Economics

All the figures in this financial model have been calculated for estimated sales of

Rs. 16.27 million in the year one. The capacity utilization during year one is

worked out at 70% with 5% increase in subsequent year’s up to the maximum

capacity utilization of 95%.

The following table shows internal rate of return, payback period and net present

value of the proposed venture.

Table 1: Project Economics

Description Details

Internal Rate of Return (IRR) 45%

Payback Period (Years) 3.01

Net Present Value (Rs.) 11,003,071

Project returns are based on the margins of the items sold. Profitability of the

business is highly dependent on raw material cost. Moreover, in bakery or food

item businesses the probability of wastage is higher, hence the reduction of



wastage through demand and supply analysis will play a vital role in profit

maximization. In this regard, efficient supply chain management will be an

appropriate strategy for this venture.

Another crucial factor for the success of this project is to maintain the hygienic

standards and clean environment to avoid customer complaints.

10.2 Project Financing

Following table provides details of the equity required and variables related to

bank loan;

Table 2: Project Finance

Description Details

Total Equity (20%) Rs. 721,526

Bank Loan (80%) Rs. 2,886,105

Markup to the Borrower (%age / annum) 8%

Tenure of the Loan (Years) 8

Grace Period (Year) 1

10.3 Project Cost

Following fixed and working capital requirements have been identified for operations of the proposed business.

Table 3: Capital Investment for the Project

Description Amount Rs.

Capital Cost

Plant and Machinery 970,000

Furniture, Fixture and Office Equipment 1,310,000

Motor Vehicles 45,000

Pre-operating Cost 185,000

Total Capital Cost 2,510,000

Working Capital

Raw Material Inventory 141,961

Up-front Building Rent* 345,000



Cash 610,669

Total Working Capital 1,097,630

Total Project Cost 3,607,631

* 3 Months advance Rent (Production Facility and Shop @ Rs. 115,000 per month).

10.4 Space Requirement

The space requirement for the proposed bakery and confectionary unit mainly

includes the production hall, store room and a retail outlet. For this purpose it is

recommended that a rented place of maximum 3,375 sqft (i.e. 2,700 sqft for

production space and 675 sq.ft for outlet) would be acquired on rent basis in the

vicinity of newly developing housing societies in the major cities. The production

space and bakery outlet could be acquired at separate places. However, it

should be ensured that both the facilities are located closely for easy supply of

produced goods to the outlet.

Table 4: Space Requirement

Description Estimated Area

(Sqft) Monthly Rent (Rs.)

Production Space 2,700 30,000

Outlet Space 675 85,000

10.5 Machinery and Equipment Requirements

Plant, machinery and equipment for the proposed project are stated below.

Table 5: List of Plant Machinery and Equipment

Sr. No Description of Item Req. Qty Unit Cost (Rs.) Total Cost (Rs.)

1 Mixer (20 Kg or 20 Ltr Capacity)

2 100,000 200,000

2 Cross Sheeter 1 200,000 200,000

3 Oven (8x8 ft) 1 350,000 350,000

4 Dies 20 150 3,000

5 Deep Freezer 1 50,000 50,000

6 Fryer and Burner 2 16,000 32,000

7 Sealing Machine 1 3,000 3,000

8 Moving Trolleys 2 10,000 20,000



9 Trays 20 600 12,000

10 Misc. Tools & Equipments (Pans, Knives and others)

1 100,000 100,000

Total 970,000

The required machinery is easily available in the local markets. Used and new

machinery can be purchased from different whole sale markets including Lahore,

Karachi, Peshawar, Gujranwala, etc. These requirements are based on the

proposed production plans as mentioned elsewhere.

10.6 Furniture & Fixtures and Other Equipment

In addition to the above plant machinery and equipment, following necessary

items will be required for the proposed venture.

Table 6: Furniture & Fixture and Other Equipment

Sr. No Description of Item Req. Qty Unit Cost (Rs.) Total Cost (Rs.)

1 Production Tables 2 20,000 40,000

2 Chairs & Other Furniture

1 25,000 25,000

3 Cost of Renovation and Interior Designing

1 800,000 800,000

4 Air conditioner 2 110,000 220,000

5 Display Chillers 1 35,000 35,000

6 Display Counter 1 35,000 35,000

7 Weighing Scales (Outlet)

1 20,000 20,000

8 Weighing Scales (Production Facility)

1 50,000 50,000

9 Micro Wave Oven 1 15,000 15,000

10 Sign Board 1 20,000 20,000

11 Miscellaneous 1 50,000 50,000

Total 1,310,000



10.7 Raw Material Requirements

The raw materials are required for production of different varieties of bakery and

confectionary products. The complete details of raw materials along with recipe

of different products are enclosed as Annexure 13.1.

10.8 Human Resource Requirement

Table 7: Human Resource Requirement

Description No. of Employees Salary/Month (per person)

Owner Manager 1 25,000

Master Chef 1 35,000

Assistant Chef 1 25,000

Helpers- Production * 2 17,500

Salesmen 2 19,000

Helpers- Shop 2 17,500

Guard 1 18,000

Total Staff 10

* Production Staff will be hired as per capacity utilization of the production.

The owner of the business is recommended to personally manage the operations

of the proposed venture. Additionally, above HR composition shall be engaged in

order to manage the operational affairs of this project under the supervision of

the owner. Appropriate experience for chef and salesmen would be required.

10.9 Revenue Generation

Following table provides the details of sales revenues for year one:

Table 8: Sales Revenue (1st Year)

Product Mix 1st Year Sales Revenue (Rs.)

Bakery Sales 12,518,188

General Item Sales** 3,755,456

Total Sales 16,273,644

** General items are assumed to be 30% of the Bakery Sales each year.

The above sales revenues are based on following key operational assumptions:



Table 9: Operational Assumptions

No of Working Days 355

No. of Working Hours / day 16

No. of Shifts / day 2

10.10 Utilities and Other Costs

An essential cost to be borne by the company is the cost of electricity and gas.

The electricity expenses are estimated to be around Rs. 57,000 per month,

whereas, gas expenses are estimated to be Rs. 385,000 / year (including both

natural gas and LPG at 100% capacity utilization). Considering the non-

availability or low pressure of natural gas alternate burning fuels i.e. LPG, wood

or kerosene oil may need to be considered. Advance procurement of raw

materials and packing material for at least 05 days will be maintained for

uninterrupted sales of goods, at the production and outlet facility.

11 CONTACT DETAILS OF EXPERTS & CONSULTANTS

Prof. Dr. Salim Ur Rehman National Institute of Food Science and Technology University of Agriculture, Faisalabad Phone:041-9200161-70/3011 Fax: 041-9201439 Mobile: 0300-6681047

Principal Scientific Officer Food and Biotechnology Research Centre PCSIR Labs Ferozpur Road, Lahore Ph: 042-99230688-95



12 ANNEXURES

12.1 Income Statement

Calculations SMEDA

Income Statement

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10

Revenue 16,273,644 19,179,652 22,504,125 26,301,696 30,633,739 35,569,175 39,126,093 43,038,702 47,342,572 52,076,830

Cost of sales

Cost of goods sold 1 10,221,216 12,046,433 14,134,481 16,519,675 19,240,562 22,340,431 24,574,474 27,031,921 29,735,113 32,708,625

Operation costs 1 (direct labor) 504,000 594,000 696,960 814,572 948,737 1,101,589 1,211,748 1,332,922 1,466,215 1,612,836

Operating costs 3 (direct electricity) 210,000 247,500 290,400 339,405 395,307 458,995 504,895 555,384 610,923 672,015

Operating costs 4 (direct water) 37,800 44,550 52,272 61,093 71,155 82,619 90,881 99,969 109,966 120,963

Operating costs 5 (direct gas) 385,000 453,750 532,400 622,243 724,730 841,491 925,641 1,018,205 1,120,025 1,232,028

Total cost of sales 11,358,016 13,386,233 15,706,513 18,356,987 21,380,491 24,825,126 27,307,638 30,038,402 33,042,242 36,346,466

Gross Profit 4,915,628 5,793,419 6,797,611 7,944,708 9,253,249 10,744,050 11,818,455 13,000,300 14,300,330 15,730,363

General administration & selling expenses

Administration expense 1,812,000 1,993,200 2,192,520 2,411,772 2,652,949 2,918,244 3,210,069 3,531,075 3,884,183 4,272,601

Administration benefits expense 181,200 199,320 219,252 241,177 265,295 291,824 321,007 353,108 388,418 427,260

Building rental expense 1,380,000 1,518,000 1,669,800 1,836,780 2,020,458 2,222,504 2,444,754 2,689,230 2,958,153 3,253,968

Electricity expense Outlet 480,000 528,000 580,800 638,880 702,768 773,045 850,349 935,384 1,028,923 1,131,815

Travelling expense 162,736 191,797 225,041 263,017 306,337 355,692 391,261 430,387 473,426 520,768

Communications expense (phone, fax, mail, internet, etc.) 54,360 59,796 65,776 72,353 79,588 87,547 96,302 105,932 116,525 128,178

Office expenses (stationary, entertainment, janitorial services, etc.) 18,120 19,932 21,925 24,118 26,529 29,182 32,101 35,311 38,842 42,726

Promotional expense 162,736 191,797 225,041 263,017 306,337 355,692 391,261 430,387 473,426 520,768

Depreciation expense 232,500 232,500 232,500 232,500 232,500 232,500 232,500 232,500 232,500 232,500

Amortization of pre-operating costs 18,500 18,500 18,500 18,500 18,500 18,500 18,500 18,500 18,500 18,500

Subtotal 4,502,153 4,952,841 5,451,155 6,002,114 6,611,263 7,284,730 7,988,103 8,761,814 9,612,895 10,549,085

Operating Income 413,475 840,578 1,346,456 1,942,594 2,641,986 3,459,319 3,830,351 4,238,486 4,687,435 5,181,279

Earnings Before Interest & Taxes 413,475 840,578 1,346,456 1,942,594 2,641,986 3,459,319 3,830,351 4,238,486 4,687,435 5,181,279

Interest expense on long term debt (Project Loan) 239,545 219,306 192,705 163,896 132,696 98,907 62,313 22,681 - -

Subtotal 239,545 219,306 192,705 163,896 132,696 98,907 62,313 22,681 - -

Earnings Before Tax 173,930 621,272 1,153,751 1,778,698 2,509,289 3,360,412 3,768,038 4,215,805 4,687,435 5,181,279

Tax - 12,127 65,375 156,805 271,858 460,103 562,009 684,741 826,230 974,383

NET PROFIT/(LOSS) AFTER TAX 173,930 609,145 1,088,376 1,621,894 2,237,432 2,900,310 3,206,029 3,531,064 3,861,205 4,206,895



12.2 Statement of Cash Flow

Calculations SMEDA

Cash Flow Statement

Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10

Operating activities

Net profit 173,930 609,145 1,088,376 1,621,894 2,237,432 2,900,310 3,206,029 3,531,064 3,861,205 4,206,895

Add: depreciation expense 232,500 232,500 232,500 232,500 232,500 232,500 232,500 232,500 232,500 232,500

amortization of pre-operating costs 18,500 18,500 18,500 18,500 18,500 18,500 18,500 18,500 18,500 18,500

Raw material inventory (141,961) (42,081) (53,495) (67,847) (85,867) (108,464) (104,940) (126,978) (153,643) (185,908) 1,071,184

Pre-paid building rent (345,000) (34,500) (37,950) (41,745) (45,920) (50,511) (55,563) (61,119) (67,231) (73,954) 813,492

Accounts payable 427,613 77,207 88,598 101,550 116,275 131,704 97,028 107,305 118,730 78,178

Cash provided by operations (486,961) 775,962 845,907 1,318,383 1,842,658 2,445,731 3,122,511 3,365,961 3,668,495 3,971,073 6,420,749

Financing activities

Project Loan - principal repayment - (320,495) (347,096) (375,905) (407,105) (440,895) (477,489) (517,120) - -

Additions to Project Loan 2,886,105 - - - - - - - - - -

Issuance of shares 721,526 - - - - - - - - - -

Cash provided by / (used for) financing activities 3,607,631 - (320,495) (347,096) (375,905) (407,105) (440,895) (477,489) (517,120) - -

Investing activities

Capital expenditure (2,510,000) - - - - - - - - - -

Acquisitions

Cash (used for) / provided by investing activities (2,510,000) - - - - - - - - - -

NET CASH 610,669 775,962 525,412 971,286 1,466,752 2,038,626 2,681,617 2,888,472 3,151,375 3,971,073 6,420,749



12.3 Balance Sheet

Calculations SMEDA

Balance Sheet

Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10

Current assets

Cash & Bank 610,669 1,386,631 1,912,043 2,883,329 4,350,082 6,388,708 9,070,325 11,958,797 15,110,173 19,081,246 25,501,995

Finished goods inventory - - - - - - - - - -

Raw material inventory 141,961 184,043 237,538 305,385 391,251 499,715 604,655 731,633 885,276 1,071,184 -

Pre-paid building rent 345,000 379,500 417,450 459,195 505,115 555,626 611,189 672,307 739,538 813,492 -

Total Current Assets 1,097,631 1,950,174 2,567,031 3,647,909 5,246,448 7,444,049 10,286,169 13,362,738 16,734,987 20,965,922 25,501,995

Fixed assets

Machinery & equipment 970,000 873,000 776,000 679,000 582,000 485,000 388,000 291,000 194,000 97,000 -

Furniture, fixtures and Office Equipment 1,310,000 1,179,000 1,048,000 917,000 786,000 655,000 524,000 393,000 262,000 131,000 -

Office vehicles 45,000 40,500 36,000 31,500 27,000 22,500 18,000 13,500 9,000 4,500 -

Total Fixed Assets 2,325,000 2,092,500 1,860,000 1,627,500 1,395,000 1,162,500 930,000 697,500 465,000 232,500 -

Intangible assets

Pre-operation costs 185,000 166,500 148,000 129,500 111,000 92,500 74,000 55,500 37,000 18,500 -

Total Intangible Assets 185,000 166,500 148,000 129,500 111,000 92,500 74,000 55,500 37,000 18,500 -

TOTAL ASSETS 3,607,631 4,209,174 4,575,031 5,404,909 6,752,448 8,699,049 11,290,169 14,115,738 17,236,987 21,216,922 25,501,995

Current liabilities

Accounts payable 427,613 504,821 593,419 694,970 811,244 942,949 1,039,977 1,147,282 1,266,012 1,344,190

Total Current Liabilities - 427,613 504,821 593,419 694,970 811,244 942,949 1,039,977 1,147,282 1,266,012 1,344,190

Other liabilities

Long term debt (Project Loan) 2,886,105 2,886,105 2,565,609 2,218,513 1,842,608 1,435,503 994,608 517,120 - - -

Total Long Term Liabilities 2,886,105 2,886,105 2,565,609 2,218,513 1,842,608 1,435,503 994,608 517,120 - - -

Shareholders' equity

Paid-up capital 721,526 721,526 721,526 721,526 721,526 721,526 721,526 721,526 721,526 721,526 721,526

Retained earnings 173,930 783,075 1,871,451 3,493,344 5,730,776 8,631,086 11,837,115 15,368,178 19,229,383 23,436,278

Total Equity 721,526 895,456 1,504,601 2,592,977 4,214,870 6,452,302 9,352,612 12,558,641 16,089,705 19,950,909 24,157,805

TOTAL CAPITAL AND LIABILITIES 3,607,631 4,209,174 4,575,031 5,404,909 6,752,448 8,699,049 11,290,169 14,115,738 17,236,987 21,216,922 25,501,995

Liabilities & Shareholders' Equity

Assets



12.4 Useful Project Management Tips

Technology

Required spare parts & consumables: Suppliers credit agreements and

availability as per schedule of maintenance be ensured before start of

operations.

Energy Requirement: Should not be overlooked and alternate source of

energy for critical operations be arranged in advance.

Machinery Suppliers: Should be asked for training and after sales services

under the contract with the machinery suppliers.

Quality Assurance Equipment & Standards: Required products quality

standards need to be defined on the packaging and a system to check them

instituted, this improves credibility.

Marketing

Product Development & Packaging: Expert's help may be engaged for

product/service and packaging design & development.

Ads & Point of Sales Promotion: Business promotion and dissemination

through banners and launch events is highly recommended. Product

brochures should be acquired from good quality service providers.

Price - Bulk Discounts, Cost plus Introductory Discounts: Price should

not be allowed to compromise on quality. Price during introductory phase may

be lower and used as promotional tool. Product cost estimates should be

carefully documented before price setting. Government controlled prices shall

be displayed.

Human Resources

Adequacy & Competencies: Skilled and experienced Master Chef should be

considered an investment and be retained on better terms, if necessary



12.5 Useful Links

Prime Minister’s Office, www.pmo.gov.pk

National Youth Development Program , www.kamyabjawan.gov.pk

Small and Medium Enterprise Development Authority, www.smeda.org.pk

National Bank of Pakistan (NBP), www.nbp.com.pk

State Bank of Pakistan (SBP), www.sbp.org.pk

Bank of Khyber, www.bok.com.pk

Bank of Punjab, www.bop.com.pk

Government of Pakistan, www.pakistan.gov.pk

Ministry of Industries & Production, www.moip.gov.pk

Ministry of Federal Education and Professional Training, http://moent.gov.pk

Government of Punjab, www.punjab.gov.pk

Government of Sindh, www.sindh.gov.pk

Government of Khyber Pakhtunkhwa, www.khyberpakhtunkhwa.gov.pk

Government of Balochistan, www.balochistan.gov.pk

Government of Gilgit Baltistan, www.gilgitbaltistan.gov.pk

Government of Azad Jammu Kashmir, www.ajk.gov.pk

Federation of Pakistan Chambers of Commerce and industry(FPCCI) www.fpcci.org.pk

Securities & Exchange Commission of Pakistan (SECP), www.secp.gov.pk

Ministry of National Food Security & Research, www.mnfsr.gov.pk

Punjab Food Authority, www.punjabfoodauthority.gov.pk

http://www.pmo.gov.pk/

http://www.kamyabjawan.gov.pk/

http://www.sbp.org.pk/

http://www.bok.com.pk/

http://moent.gov.pk/



13 KEY ASSUMPTION

13.1 Raw Material Assumptions

Plain & Dry Cakes

Plain cakes

Raw material: Units of measure

Quantity Rate Cost % ingredients Qty

Ingredients

Qty Ingredients

in grams For Making 1 Kg

Qty Ingredients for Making 1 Kg (gms)

Qty Ingredients for Making

1 Pound (gms)

Butter Kg 280 450 125,959 21.73% 303 225 225 102.058

Sugar Kg 50 65 3,235 3.86% 333 40 40 18.144

Maida Kg 373 70 26,125 28.97% 393 300 300 136.078

Baking powder 12 60 746 0.97% 12 10 10 4.536

Eggs Pcs 11,594 8.33 96,615 34.77% 7,261 9 360 163.293

Flavour Ltr. 1 600 373 0.05% 1 0.5 1 0.227

Cream + Honey 124 500 62,202 9.66% 100 100 45.359

315,255 100.00% 8,302 1036

Plain fruit cakes



Ingredients

Qty Ingredients



Butter Kg 316 450 142,012 24.498% 162 250 250

Sugar Kg 50 65 3,282 3.920% 178 40 40

Maida Kg 316 70 22,091 24.498% 211 250 250

Baking powder Kg 13 60 757 0.980% 6 10 10

Fruit Chuncks Kg 379 250 94,674 29.397% 66 300 300

Sougi Kg 63 200 12,623 4.900% 66 50 50

Eggs Pcs 3,865 8.333 32,205 11.759% 3,888 3 120

Flavour Ltr. 1 600 379 0.049% 0.32 0.5 0.5



308,023 100% 4,578 1020.5

Dry cakes



Ingredients

Qty Ingredients



Butter Kg 357 450 160,629 22.167% 545 225 225

Sugar Kg 63 65 4,125 3.941% 545 40 40

Maida Kg 436 70 30,539 27.094% 545 275 275

Backing powder Kg 16 60 952 0.985% 22 10 10

Eggs Pcs 14,492 8.333 120,769 35.468% 16,364 9 360

Flavour Ltr. 8 600 4,759 0.493% 1.09 5 5

Cream + Honey Kg 159 500 79,323 9.852% 100 100

401,096 100.000% 18,023 1015



Sweets & Nimko

Nimko


Quantity Rate Cost %

ingredients Qty

Ingredients

Qty Ingredients


Qty Ingredients for Making 1

Kg (gms)

Baison Kg 485 100 48,488 68.293% 491 700 700

Dry Fruit Kg 139 400 55,415 19.512% 123 200 200

Channey Kg 69 150 10,390 9.756% 61 100 100

Nimko masala Kg 17 150 2,598 2.439% 25 25 25

116,890 100% 700 1025

Sweets



ingredients Qty

Ingredients

Qty Ingredients



Kg (gms)

Khoya Kg 1,801 500 900,362 33.816% 1,050 350 350

Maida Kg 1,158 70 81,033 21.739% 263 225 225

Eggs Kg 21,300 8.333 177,500 15.459% 131 4 160

Ghee Kg 772 200 154,348 14.493% 53 150 150

Sugar syrup or Sugar Kg 772 800 617,391 14.493% 919 150 150

1,930,634 100% 2,415 1035



Chicken Bread



ingredients Qty

Ingredients

Qty Ingredients



Kg (gms)

Maida Kg 416.02 70 29,121 14.648% 336.00 150 150

Oil Ltr 55.47 190 10,539 1.953% 33.60 20 20

Yeast Kg 5.55 500 2,773 0.195% 1.68 2 2

Sugar Kg 69.34 65 4,507 2.441% 33.60 25 25

Salt Kg 5.55 8 44 0.195% 3.60 2 2

Chicken Kg 970.70 310 300,918 34.180% 480.00 350 350

Onion Kg 346.68 30 10,400 12.207% 720.00 125 125

Masala Kg 138.67 80 11,094 4.883% 84.00 50 50

Cheese Kg 277.34 800 221,875 9.766% 180.00 100 100

Mayonnaise & Ketchup

Kg 138.67 140 19,414 4.883% 120.00 50 50

Mix Vegitable Kg 416.02 80 33,281 14.648% 120.00 150 150

2,840 643,967 100.000% 2,112 1024

Fresh Cream cakes



ingredients Qty

Ingredients

Qty Ingredients



Kg (gms)

Butter Kg 491 450 221,135 12.207% 545 80 125

Sugar Kg 393 65 25,553 9.766% 545 100 100

Maida Kg 491 70 34,399 12.207% 545 100 125

Backing powder Kg 8 60 472 0.195% 22 2 2

Eggs Pcs 16,103 8.333 134,188 15.625% 16,364 4 160

Flavour Ltr. 8 600 4,718 0.195% 1.09 2 2

Fresh Cream Kg 2,005 500 1,002,477 49.805% 510 510

1,422,940 100.000% 18,023 1024

* Assume 20% extra cost for this type of Cakes 1,707,528

Pastries & Puff etc





ingredients Qty

Ingredients

Qty Ingredients



Kg (gms)

Butter Kg 315 450 141,526 12.207% 545 100 125

Sugar Kg 252 65 16,354 9.766% 545 100 100

Flour (Maida) Kg 315 70 22,015 12.207% 545 100 125

Baking powder Kg 5 60 302 0.195% 22 2 2

Eggs Pcs 10,306 8.333 85,880 15.625% 16,364 4 160

Flavour Ltr. 5 600 3,019 0.195% 1.09 2 2

Fresh Cream Kg 1,283 500 641,585 49.805% 510 510

910,682 100.000% 18,023 1024

Bread

-

- 100.000% 407

1030



Biscuits etc



ingredients Qty

Ingredients

Qty Ingredients


Qty Ingredients

For Making 1 Kg (gms)

Butter Kg 873 450 392,828 16.393% 303 170 170

Sugar Kg 770 65 50,066 14.465% 333 150 150

Flour (Maida) Kg 1,797 70 125,808 33.751% 393 350 350

Baking powder Kg 26 60 1,541 0.482% 12 5 5

Eggs Pcs 47,925 8.333 399,375 34.716% 7,261 9 360

Flavour Ltr. 10 600 6,162 0.193% 1 2 2

975,779 100% 8,302 1037

Snacks

Per Piece

Chicken Drum stick Leg Piece 56 198,800

Chicken Leg Piece 105 447,300

Chicken Shami 28 149,100

Chicken Sandwich 49 86,975

Chicken Patties 28 248,500

Chicken Bread roll 42 149,100

Chicken Pizza





ingredients Qty

Ingredients

Qty Ingredients in

grams For Making 1 Kg

Flour (Maida) Kg 930.58 70 65,141 19.417% 336.00 200

Oil Ltr 69.79 190 13,261 1.456% 33.60 15

Yeast Kg 4.65 500 2,326 0.097% 1.68 1

Sugar Kg 93.06 65 6,049 1.942% 33.60 20

Salt Kg 18.61 15 279 0.388% 3.60 4

Chicken Kg 1,395.87 310 432,721 29.126% 480.00 300

Onion Kg 930.58 30 27,917 19.417% 720.00 200

Masala Kg 186.12 80 14,889 3.883% 84.00 40

Cheese Kg 465.29 800 372,233 9.709% 180.00 100

Mayonnaise & Ketchup

Kg 232.65 140 32,570 4.854% 120.00 50

Mix Vegetables Kg 465.29 80 37,223 9.709% 120.00 100

4,793 1,004,610 100% 2,112 1030

* Figure are rounded off at zero decimal


Small and Medium Enterprises Development Authority(SMEDA) 24

13.2 Sales Assumptions

Description Units Sales Per Day (Qty)

Sales Per Year (Qty)

Sales Price / Unit (Rs.)

Annual Sales (Rs.)

Fresh Cream Cakes

Fresh cream Pounds 10 3,550 300 1,065,000

Fresh fruit Pounds 5 1,775 330 585,750

Chocolate Cakes Pounds 5 1,775 300 532,500

Butter cream cakes Pounds 5 1,775 350 621,250

Total

8,875

2,804,500

Fresh & Chocolate Pastries

Pounds 5 1,775 300 532,500

Donuts Pounds 5 1,775 250 443,750

Cream puff Pounds 3 1,065 250 266,250

Cream roll Pounds 3 1,065 250 266,250

Total

5,680 1,508,750

Bread (Out Sourced)

Bread, Bun, Rusk Etc. Kgs 10 3,550 180 639,000

Total

639,000

Dry cakes

Dry cakes Pounds 10 3,550 300 1,065,000

Fruit cakes large Pounds 3 1,065 260 276,900

Fruit cakes small Pounds 5 1,775 120 213,000

Plain cakes large Pounds 3 1,065 240 255,600

Plain cakes small Pounds 5 1,775 110 195,250

Total

9,230 2,005,750

Snacks

Chicken pizza large Pcs 5 1,775 350 621,250

Chicken pizza medium Pcs 10 3,550 240 852,000

Chicken pizza small Pcs 14 4,970 50 248,500

Chicken bread Pcs 8 2,840 550 1,562,000

Chicken drum stick leg piece

Pcs 10 3,550 80 284,000

Chicken leg piece Pcs 12 4,260 150 639,000

Chicken shami Pcs 15 5,325 40 213,000

Chicken sandwich Pcs 5 1,775 70 124,250

Chicken patties Pcs 25 8,875 40 355,000

Chicken bread roll Pcs 10 3,550 60 213,000

Total

40,470 5,112,000


Small and Medium Enterprises Development Authority(SMEDA) 25

Description Units Sales Per Day (Qty)

Sales Per Year (Qty)

Sales Price / Unit (Rs.)

Annual Sales (Rs.)

Sweets & Nimko

Nimko Kgs 2 710 500 355,000

Gulab Jaman Kgs 3 1,065 500 532,500

Chum Chum Kgs 3 1,065 500 532,500

Kalakand Kgs 2 710 500 355,000

Burfi Kgs 3 1,065 500 532,500

Moti Choor Kgs 3 1,065 500 532,500

Pateesa Kgs 1 355 500 177,500

Total

15 6,035 3,017,500

Biscuits

Cake Rusk Kgs 2 710 525 372,750

White Biscuits Kgs 1 355 525 186,375

Coconut Biscuits Kgs 1 355 525 186,375

Macaroon Coconut Kgs 1 355 525 186,375

Almond Macaroon Kgs 1 355 525 186,375

Cheese Finger Kgs 1 355 525 186,375

Salty Zeera Plus Kgs 1 355 525 186,375

Plain Khatai Kgs 1 355 525 186,375

Baker Khani Kgs 1 355 525 186,375

Finger Kgs 1 355 525 186,375

Jam Wafer Kgs 1 355 525 186,375

Special Biscuit Kgs 1 355 525 186,375

Chocolate Biscuits Kgs 1 355 525 186,375

Round Almond Biscuit Kgs 1 355 525 186,375

Total

15 5,325 2,795,625

* Figures are rounded off at zero decimal.

* All the Figures assumed @ 100% production capacity

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