Business Plan On Peanut Butter 5y6xd
This document was ed by and they confirmed that they have the permission to share it. If you are author or own the copyright of this book, please report to us by using this report form. Report r6l17
Overview 4q3b3c
& View Business Plan On Peanut Butter as PDF for free.
More details 26j3b
- Words: 4,333
- Pages: 25
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Business Plan on Peanut butter G-lite Foods Pvt.Ltd GIDC,, Rajkot highway, Junagadh, Gujarat-362001
1
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
ACKNOWLEDGEMENT
The present investigation is a synthesized effort of various sources. Word scan hardly express our feeling of gratitude to all those who extended cooperation in completing this business plan successfully. The satisfaction that accompanies the successful completion of any task would be incomplete without the mention of all those people who made it possible whose constant guidance and encouragement crowns the efforts with success
Our thanks to Dr.Y. Sudarshan, Director, IABM, SKRAU,Bikaner for this business plan.
We are very grateful to Dr. Aditi Mathur (Assistant Professor), Dr. Amita Sharma(Assistant Professor) and Mr.Satyveer Singh Meena(Assistant Professor) for providing necessary help during the preparation of business plan.
Aghera Vivekkumar MBA(AB) 1st YEAR IABM,BIKANER
2
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Index Sr.no.
Particular
Page No.
1
Introduction
4-
2
Production Process
5
3
Nutritive Profile
8
3
Benefits of Peanut butter
8
4
Market Potential
11
5
Herbal Garden Preparation Peanut butter product strategies
11
6
Peanut butter product line
11
7
Distribution Strategy of G-lite organization
12
8
Markets for G-lite foods Products
12
9
Pricing strategy
13
10
Financial plan
13
11
Break even analysis
21
12
Return on investment [ROI]
23
13
Payback Period of the project
23
14
Market feasibility
24
3
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
15
Reference
24
INTRODUCTION:Peanut butter: • • • • •
Peanut butter is a food paste or spread made from ground dry roasted peanuts. It often contains additional ingredients that modify the taste or texture, such as salt, sweeteners or emulsifiers. Peanut butter is served as a spread on bread, toast or crackers, and used to make sandwiches Peanuts have considerable nutrients and are consumed in different forms all over the world Consumed in large quantities especially in western countries. Hence, to target growing export market and local market and intend to be financially sound.
HISTORY: The use of peanuts dates to the Aztecs and Incas, and peanut paste may have been used by the Aztecs as a toothache remedy in the first century of the Common Era (CE). Marcellus Gilmore Edson (1849 – 1940) of Montreal, Canada obtained a patent for peanut butter in 1884. Edson's cooled product had "a consistency like that of butter, lard, or ointment" according to his patent application which described a process of milling roasted peanuts until the peanuts reached "a fluid or semi-fluid state". He mixed sugar into the paste to harden its consistency. A businessperson from St. Louis named George Bayle produced and sold peanut butter in the form of a snack food in 1894. John Harvey Kellogg, known for his line of prepared breakfast cereals, was issued a patent for a "Process of Producing Alimentary Products" in 1898, and used peanuts, although he boiled the peanuts rather than roasting them. Kellogg's Western Health Reform Institute served peanut butter to patients because they needed a food that contained a lot of protein, yet which could be eaten without chewing. At first, peanut butter was a food for wealthy people, as it became popular initially as a product served at expensive health care institutes. A Meal Ready to Eat or "MRE kit" which contains peanut butter packets.
4
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Early peanut-butter-making machines were developed by Joseph Lambert, who had worked at John Harvey Kellogg's Battle Creek Sanitarium, and Dr. Ambrose Straub who obtained a patent for a peanut-butter-making machine in 1903."In 1922, chemist Joseph Rosefield invented a process for making smooth peanut butter that kept the oil from separating by using partially hydrogenated oil"; Rosefield "...licensed his invention to the company that created Peter Pan peanut butter" in 1928 and in "...1932 he began producing his own peanut butter under the name Skippy". Under the Skippy brand, Rosefield developed a new method of churning creamy peanut butter, giving it a smoother consistency. He also mixed fragments of peanut into peanut butter, creating the first "chunky"-style peanut butter. In 1955, Procter & Gamble launched a peanut butter named Jif, which was sweeter than other brands, due to the use of "sugar and molasses" in its recipe. As the US National Peanut Board confirms, "Contrary to popular belief, George Washington Carver did not invent peanut butter."Carver was given credit in popular folklore for many inventions that did not come out of his lab. By the time Carver published his document about peanuts, entitled "How to Grow the Peanut and 105 Ways of Preparing it For Human Consumption" in 1916, many methods of preparation of peanut butter had been developed or patented by various pharmacists, doctors and food scientists working in the US and Canada. January 24 is National Peanut Butter Day in the United States.
TYPES: The two main types of peanut butter are crunchy (or chunky) and smooth. In crunchy peanut butter, some coarsely-ground peanut fragments are included to give extra texture. The peanuts in smooth peanut butter are ground uniformly, creating a creamy texture. In the US, food regulations require that any product labelled "peanut butter" must contain at least 90% peanuts; the remaining <10% usually consists of "...salt, a sweetener, and an emulsifier or hardened vegetable oil which prevents the peanut oil from separating". In the US, no product labelled as "peanut butter" can contain "artificial sweeteners, chemical preservatives, [or] natural or artificial coloring additives."Some brands of peanut butter are sold without emulsifiers that bind the peanut oils with the peanut paste, and so require stirring after separation. Most major brands of peanut butter add white sugar, but there are others that use dried cane syrup, agave syrup or coconut palm sugar. Organic and artisanal peanut butters are available, but their markets are small.
5
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Benefits of peanut butter: 1.Rich Source of Protein Peanut butter (100 grams) contains a high amount of protein (25 – 30 grams). Proteins that we eat are broken down into amino acids, which are then utilized in each and every cell for repairing and building the body.
2. Lowers cholesterol levels The fat content in peanut butter is almost equal to that of the fats found in olive oil. It contains both polyunsaturated fats and monounsaturated fats. As these fats are not saturated, they are good to consume without putting the heart at any risk. The unsaturated fats in peanut butter help to lower bad cholesterol levels (low-density lipoprotein) and promote the circulation of good cholesterol (high-density lipoprotein).
3. Prevents type ii diabetes Consuming peanut butter can also be beneficial in reducing the risk of type II diabetes. Peanuts contain not only protein but also unsaturated fats. Unsaturated fats have been noted to improve insulin sensitivity. Research into peanut butter consumption and diabetes showed that a higher intake of peanut butter and other nuts lowers the risk of type II diabetes.
4. Good Source of Vitamins Peanut butter contains many vitamins that are good for our body to function properly. Vitamin A found in it is helpful for eyesight, while vitamin C helps to boost the immune system and heals simple ulcers faster. On the other hand, the vitamin E found in peanut butter is a very important micronutrient needed by our body to dissolve complex fatty acid structures and fat blockages in the arteries.
5. Antioxidant properties Peanut butter contains antioxidant properties due to the presence of folate, niacin, pantothenic acid, pyridoxine, riboflavin, and thiamin. One of the antioxidants found in it is resveratrol. Resveratrol is a polyphenolic antioxidant which has been found to be effective in controlling certain types of cancers, heart disease, Alzheimer’s disease, viral and/or fungal infections, and degenerative nerve diseases.
6. Prevents cancer Peanut butter contains B-sitosterol, a phytosterol that has a great property of fighting against cancer, particularly colon, prostate, and breast cancers. Peanuts and its products, such as peanut oil and peanut butter are ideal sources of phytosterols. 6
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
7. Regulates blood sugar levels Peanut butter is a good source of magnesium (170mg/100 grams). This makes up for 42% of the daily recommended value of magnesium. Magnesium has an important role to play in muscle, bone, and immunity development in the body. Magnesium also helps in regulating blood sugar levels and blood pressure. Its presence in our body helps in more than 300 biochemical reactions that are extremely important for our survival.
8. High in Potassium Peanut butter contains potassium (70 mg/100g) that acts as an electrolyte and is a fluid-balancing element in the body. In comparison to sodium, which directly puts pressure on the cardiovascular system in the form of hypertension, potassium does not put any pressure either on the blood or on the cardiovascular system. In effect, potassium is a heart-friendly element that is found in high quantities in peanut butter.
9. Reduce Risk of Gallstones Gallstones, a major health risk in developed countries, is caused by being overweight, crash diets, certain types of cholesterol drugs, and birth control pills. A study on peanuts and nut consumption relating to the risk of gallstones was undertaken and the results of the study showed that over a period of 2 decades, women who consumed peanut butter and nuts on a regular basis had reduced their risk of developing gallstones.
10. Rich in Dietary Fiber Peanuts and peanut butter are both high in dietary fiber. One cup or approximately 125 g of peanuts and peanut butter has 12 g and 20 g of dietary fiber, respectively. Dietary fiber is one of the most important parts of our diet since a lack of dietary fiber can lead to several health problems and diseases such as constipation, diabetes, cholesterol, and various heart diseases.
Production Process Planting and harvesting: Peanuts are usually planted in Kharif. The peanut comes from a yellow flower which bends over and infiltrates the soil after blooming and wilting, and the peanut starts to grow in the soil. Peanuts are harvested from late August to October, while the weather is clear. This weather allows for dry soil so that when picked, the soil does not stick to the stems and pods. The peanuts are then removed from vines and transported to a peanut shelling machine for mechanical drying. After cropping, the peanuts are delivered to warehouses for cleaning, where they are stored unshelled in silos. 7
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
1.Shelling The most important thing about shelling is to remove the shell of peanuts with the smallest damage to the seed. The moisture of the unshelled peanuts is controlled to avoid excessive frangibility of the shells and kernels, which in turn, reduces the amount of dust present in the plant. After, the peanuts are sent to a series of rollers set specifically for the batch of peanuts, where they are cracked. After cracking, the peanuts go through a screening process where they are inspected for contaminants.
2.Roasting The dry roasting process employs either the batch or continuous method. In the batch method, peanuts are heated in large quantities in a revolving oven at about 426.6℃. Next, the peanuts in each batch are uniformly held and roasted in the oven at 160℃ for about 40 to 60 minutes. This method is good to use when the peanuts differ in moisture content. In the continuous method, a hot air roaster is employed. The peanuts through the roaster whilst being rocked to permit even roasting. A photometer indicates the completion of dry roasting.This method is favoured by large manufacturers since it can lower the rate of spoilage and requires less labor.
3.Cooling After dry roasting, peanuts are removed from the oven as quickly as possible and directly placed in a blower-cooler cylinder. There are suction fans in the metal cylinder that can pull a large volume of air through, so the peanuts can be cooled more efficiently. The peanuts will not be dried out because cooling can help retain some oil and moisture. The cooling process is completed when the temperature in the cylinder reaches 30℃.
4.Blanching After the kernels have been cooled down, the peanuts will undergo either heat blanching or water blanching to remove the remain seed coats. Compared to heat blanching, water blanching is a new process. Water blanching first appeared in 1949.
5.Heat blanching Peanuts are heated by hot air at 280 degrees Fahrenheit (137.8 degrees Celsius) for not more than 20 minutes in order to soften and split the skins. After that, the peanuts are exposed to continuous steam in a blanching machine. The skins are then removed using either bristles or soft rubber belts. After that, these skins are separated and blown into waste bags. Meanwhile, the hearts of peanuts are segregated through inspection.
6.Water blanching After the kernels are arranged in troughs, the skin of the kernel is cracked on opposite sides by rolling it through sharp stationary blades. While the skins are removed, the kernels are brought 8
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
through a one-minute hot water bath and placed on a swinging pad with canvas on top. The swinging action of the pad rubs off the skins. Afterward, the blanched kernels are dried for at least six hours by hot air at 120 degrees Fahrenheit (48.8 degrees Celsius). After blanching, the peanuts are screened and inspected to eliminate the burnt and rotten peanuts. A blower is also used to remove light peanuts and discoloured peanuts are removed using a colour sorting machine.
7.Grinding After blanching the peanuts are sent to grinding to be manufactured into peanut butter. The peanuts are then sent through two sizes of grinders. The first grinder produces a medium grind, and the second produces a fine grind. At this point, salt, and a vegetable oil stabilizer are added to the fine grind to produce the peanut butter. This adds flavour and allows the peanut butter to stay as a homogenous mixture. Chopped peanuts may also be added at this stage to produce “chunky” peanut butter. 8.Packaging Before packaging, the peanut butter must first be cooled in order to be sealed in jars.The mixture is pumped into a heat exchanger in order to cool it to about 48.8 degrees Celsius. Once cool, the peanut butter is pumped into jars and vacuum sealed. This vacuum sealing rids the container of oxygen so that oxidation cannot occur, preserving the food. The jars are then labelled and set aside until crystallization occurs. The peanut butter is then packaged into cartons distributed to retailers, where they are stored at room temperature and sold to consumers. A 2012 article stated that "China and India are the first and second largest producers, respectively", of peanuts. The United States of America "...is the third largest producer of peanuts (Georgia and Texas are the two major peanut-producing states)"and "more than half of the American peanut crop goes into making peanut butter."
Manufacturing process
9
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Nutritional profile Calories-588 (Amount-100gm.)
(amount-100 gm.)
% Daily Value* Total Fat
50 g
Saturated fat 10 g Polyunsaturated fat 14 g Monounsaturated fat 24 g Cholesterol
0 mg
Sodium
17 mg
Potassium
649 mg
Total Carbohydrate
20 g
Dietary fiber 6 g Sugar 9 g Protein
25 g
Vitamin A(eyesight)
0%
Vitamin C
0%
Calcium
4%
Iron
10%
Vitamin D
0%
Vitamin B-6
25%
Vitamin B-12
0%
Magnesium
38%
10
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Peanut allergy For people with a peanut allergy, peanut butter can cause a variety of possible allergic reactions, including life-threatening anaphylaxis. This potential effect has led to banning peanut butter, among other common foods, in some schools.
Market potential •
Indian peanuts are popular all over the world with large exports every year.
•
But unfortunately, our market share is primarily confined to raw peanuts and value added products like blanched and roasted or peanut butter have very negligible contribution
•
Peanut butter has high penetration in western countries market as compared to AsiaPacific region due to lack of awareness about the benefits associated with peanut butter
•
Growing awareness about the autoimmune diseases such as celiac disease is raising the need of low calorie nutritional food thus increasing the demand of peanut butter across globe.
•
The global peanut butter market is estimated to reach value USD 6.73 billion and is expected to grow at a CAGR 10% over the forecast period i.e. 2016-2024
•
Asia-Pacific peanut butter market is expected to reach USD 1 billion in 2024 and is projected to grow at a CAGR of 13% the during the time period of 2016 to 2024 due to the influence of US culture using peanut butter as a staple food.
•
Peanut Butter is part of the staple break-fast food in US. Statistics says that about 89% of the entire US households consume it as bread spread. This is further evident from the fact that about one-third of the US peanut harvest is utilized for manufacturing peanut butter.
•
From an international perspective it is shown that revenue of peanut butter generated in the United States (US$1,961m in 2017)
•
The consumption of peanut butter is also high in the countries like Philippines, South Korea, Canada, etc. as they are well influenced by US culture
•
As an increment in population of working women in India encourages the market for ready to eat products in which peanut butter is an important player.
11
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Product life cycle •
Introduction stage.
•
New product in retail market.
•
Riskiest stage of life-cycle.
•
Little direct competition.
Product strategy •
Spicy peanut butter as the “star” of its product line. 12
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006 •
This flavor is offered by international brands such as Jif and Skippy but is not produced by any local food processors.
Peanut butter product line. Peanut Butter
Flavors primary consumer
Purchaser/Decision- Maker
Regular
Adults and children
Mothers/Wives
Spicy (principal flavor)
Adults
Mothers/Wives
Sweetened
Children
Mothers
Pricing strategy: •
Our approach is “existing product in new market” for domestic markets & “existing product in existing market” for export markets.
•
The ideal pricing strategy will be Value Based Pricing in which we would win customers by charging low price and high quality to attract customers and expand our market share.
Markets for G-lite foods Products: •
Retailers—supermarkets, convenience stores, artisan markets, specialty stores, informal market vendors
•
Institutional customers—restaurants, hotels, organizations, agencies, trade groups, schools, etc.
•
Production center—selling wholesale from production site
•
Individuals—clients/employees of G-lite foods sell to individual friends, family and community
Distribution Strategy of G-lite organization: 13
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Financial plan: • Capital investment Land and building –
Land 1500 m2
–
Construction area 1000m2
–
Cost of construction 42 lakh
–
Cost of land 105 lakh
Plant and machinery -
groundnut shelling capacity 10 tone per shift Blanching capacity 5 tone per shift Roasting capacity 5 tone prr shift Peanut butter making capacity 5 tone per shift Estimated values of plant and machinery 14
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
-
Estimated values of plant and machinery: ITEM/MACHINE
QUANTITY
PRICE (Rs)
Elevator
2
70000
Pre-cleaner
1
468000
Destoner
1
315000
Vibratory Screw
1
30000
Opener
1
45000
Slotting Screen
1
30000
Picking/Sorting tables
4
500000
Vibrating Screens
1
40000
Radiant Ray Roaster
1
1200000
Cooling Seive
1
50000
Whole Nut Blancher
1
500000
Chamberless vacuum Packing Machine
1
150000
Air Compressor
1
35000
Split Nut Blancher
1
500000
Peanut Butter Mill
2
1000000
SS Holding Tank with Stirrer & Butter Pump
1
225000
Stabilizer Feeder
1
100000
Ingredient Feeder
1
100000
Ribbon Blender
1
150000
Scrape Surface Heat Exchanger
1
3000000
Ammonia Plant
1
1000000
SS Piping Kit
100000
PistonFiller For Butter Packing
1
300000 12289600
Total 15
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Taxes, Transportation, Electrification & Installation
2000000
Total
14289600
Estimated expenditure of manpower:
Particulars
Total Salary (Rs)
Monthly Salary (Rs/Person)
Nos
Works Manager
1
14000
14000
Supervisor
2
10000
20000
Machine Operators/Mechanic
3
9000
27000
Skilled Workers
3
7000
21000
Semi-skilled Workers
3
6000
18000
Helpers
5
6000
30000
Personnel Manager
1
8000
8000
ant
1
7000
7000
Clerk
1
6000
8000
Peon
2
4000
7000
Watchman
1
4500
2500
Electrician
1
4500
2500
Total
38
Tentative Implementation Schedule:
16
168000
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Activity
Period (months)
Application and Sanction of Loans
2
Site Selection and Commencement of Work
1
Completion of Civil Work & Placement of orders for machinery
4
Erection, Installation and Trials Runs
1
Estimated value of land and building:
Particulars
Area (sq. m)
Cost (Rs. In lakh)
Land
1500
105
Building
1000
42 147
Total
Working capital requirement:
Particulars
Period
(months)
Margin
Total
(Rs in Lakhs)
17
Bank
Promoters
(Rs in Lakhs)
(Rs in Lakhs)
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Stock of raw and packing material
1
Other Expenses
1
20%
Total
184.26
147.41
36.84
5
0
5
189.26
147.41
41.84
Cost of project and means of finance:
Item/Particulars
Amount
Land and Building
14700000
Machinery
14289600
Miscellaneous Assets
500000
Preliminary & Pre-operative Expenses
2000000
Contingences at 10% on Land & Building and Plant & Machinery
2698900
Working Capital
18926000
Total
53114500
Means of Finance Promoter's Contribution
12747500
Term Loan From bank
40367000
Total
53114500
Debt Equity Ratio
3:1 18
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Promoter's Contribution
24%
Estimated sales value: Product
Quantity (ton)
Peanut Butter
Price/ton (Rs)
Sales value (in Lakh)
1000
260000
2600
220
3750
8.25
Husk Total
2608.25
Estimated expenditure of raw material: Product
Quantity(ton)
Price/ton(Rs.)
Sales value(in Lakh)
Peanut butter Husk Total
1000 220
260000 3750
2600 8.25 2608.25
Interest on term loan of Rs 21441000 is calculated at 13% per annum assuming complete repayment in 5 years including a moratorium period of 6 months Interest on Term Loan: Term loan = Total Loan – Working Capital = 40367000-18926000 = 21441000 Rs. Moratorium period of 6 months Repayment of loan in 54 months
Loan and interest for 5 years: 19
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Loan Year Amount of loan in starting of year
Repayment
Loan at the end of year
Interest at 13%
Year 1
Year 2
Year 3
Year 4
Year 5
21441000
18224850
12650190
7075530
1072050
3216150
5574660
5574660
6003480
1211420
18224850
12650190
7075530
1072050
-
2787330
2369230
1644525
919820
139370
Interest on working capital of 3 years:
Year 1
Year 2
Year 3
Working Capital
18926000
18926000
18926000
Interest at 14%
2649000
2649000
2649000
Depreciation of 2 years : Cost 1st Year Building (10%)
Depreciation 2nd Year
4200000
3780000
20
1st Year 420000
2nd Year 378000
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Machinery (20%)
14289600
11431680
2857920
2286336
500000
400000
100000
80000
3377920
2744336
Miscellaneous Assets (20%) Total Depreciation
Projected Profitability: (Rs. In lakhs) No.
Particulars
1st Year
A
Installed capacity
1000 tonnes
Capacity Utilisation
60%
75%
1564.95
1956.18
564.78
705.97
Utilities
5.00
6.00
Salaries
20.04
23.10
8
9.2
12.00
14.00
Selling & distribution expenses
6
7
istration expenses
8
9
Total
623.82
774.27
Profit Before Interest & Depreciation
941.13
1181.91
Interest on Term Loan
27.87
23.70
Interest on Working Capital
26.49
26.49
Depreciation
33.71
27.45
Sales Realization B
Cost of Production Raw and Packing Materials
Stores and Spares Repairs & Maintenance
C
2nd Year
21
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Profit Befor Tax
853
1104.27
Income tax at 33%
281.49
364.41
Cash Accurals
571.51
739.86
32.16
55.75
Repayment of Term Loan
Break even analysis: No.
Particulars
A
Sales
B
Variable Cost
Amount (Rs. In lakhs) 1564.95
Raw and packaging materials
570.10
Utilities
5
Stores and Spares
8
Selling and distribution
8
Total
591.1
C
Contribution (A-B)
972.9
D
Fixed Cost Salary
20.04
istration Cost
8
Repairs and Maintenance
12
Interest on term loan
27.87
Interest on Working Capital
26.49
Depreciation
33.71
Total
128.11 22
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
•
Break-even Sales It is the amount of sales sufficient to reach the break even point Fixed cost BES=
_______________ PV ratio
Contribution PV =
________________ X 100 Sales revenue
972.9 PV
=
_______________ X 100
=
Rs. 62.17
1564.95
128.11 Break even sales
= _________________ X 100 62.17
=
Rs. 20606400
Return on investment [ROI]: Return on investment is the average return one investor gets from his total investment.
23
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
EBIT ROI =
_________________
X
100
Capital employed
35817000 ROI
=
-------------------- X
100 = 67.45 %
53114500
Payback Period of the project: It is the period required for an investor to get back all the money he has invested in one business.
Total Project Cost
53114500
------------------------
= -------------
Average Cash Flow
27010000
= 1.97 years
Market feasibility % Increase in cost
Particular
Increase in production cost (in lakh)
Increase or decrease level of profit
10%
land & building
28.98 lakh
2% decrease
10%
plant & machinery
14.28 lakh
1.7% decrease
24
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
20%
land & building
57.97 lakh
4% decrease
20%
plant & machinery
28.56 lakh
3.4% decrease
10%
raw material
94.13 lakh
13.7% decrease
20%
raw material
188.23 lakh
27.5% decrease
Reference: https://en.wikipedia.org/wiki/Peanut_butter https://www.organicfacts.net/health-benefits/seed-and-nut/health-benefits-of-peanut-butter.html http://www.insidertradings.org/2017/12/18/peanut-butter http://dasfoodindia.com/2017/01/24/peanut-butter-market-in-india/ timesofindia.indiatimes.com/city/ahmedabad/Gujarat-leads-peanut-butter-production
25
Business Plan on Peanut butter G-lite Foods Pvt.Ltd GIDC,, Rajkot highway, Junagadh, Gujarat-362001
1
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
ACKNOWLEDGEMENT
The present investigation is a synthesized effort of various sources. Word scan hardly express our feeling of gratitude to all those who extended cooperation in completing this business plan successfully. The satisfaction that accompanies the successful completion of any task would be incomplete without the mention of all those people who made it possible whose constant guidance and encouragement crowns the efforts with success
Our thanks to Dr.Y. Sudarshan, Director, IABM, SKRAU,Bikaner for this business plan.
We are very grateful to Dr. Aditi Mathur (Assistant Professor), Dr. Amita Sharma(Assistant Professor) and Mr.Satyveer Singh Meena(Assistant Professor) for providing necessary help during the preparation of business plan.
Aghera Vivekkumar MBA(AB) 1st YEAR IABM,BIKANER
2
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Index Sr.no.
Particular
Page No.
1
Introduction
4-
2
Production Process
5
3
Nutritive Profile
8
3
Benefits of Peanut butter
8
4
Market Potential
11
5
Herbal Garden Preparation Peanut butter product strategies
11
6
Peanut butter product line
11
7
Distribution Strategy of G-lite organization
12
8
Markets for G-lite foods Products
12
9
Pricing strategy
13
10
Financial plan
13
11
Break even analysis
21
12
Return on investment [ROI]
23
13
Payback Period of the project
23
14
Market feasibility
24
3
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
15
Reference
24
INTRODUCTION:Peanut butter: • • • • •
Peanut butter is a food paste or spread made from ground dry roasted peanuts. It often contains additional ingredients that modify the taste or texture, such as salt, sweeteners or emulsifiers. Peanut butter is served as a spread on bread, toast or crackers, and used to make sandwiches Peanuts have considerable nutrients and are consumed in different forms all over the world Consumed in large quantities especially in western countries. Hence, to target growing export market and local market and intend to be financially sound.
HISTORY: The use of peanuts dates to the Aztecs and Incas, and peanut paste may have been used by the Aztecs as a toothache remedy in the first century of the Common Era (CE). Marcellus Gilmore Edson (1849 – 1940) of Montreal, Canada obtained a patent for peanut butter in 1884. Edson's cooled product had "a consistency like that of butter, lard, or ointment" according to his patent application which described a process of milling roasted peanuts until the peanuts reached "a fluid or semi-fluid state". He mixed sugar into the paste to harden its consistency. A businessperson from St. Louis named George Bayle produced and sold peanut butter in the form of a snack food in 1894. John Harvey Kellogg, known for his line of prepared breakfast cereals, was issued a patent for a "Process of Producing Alimentary Products" in 1898, and used peanuts, although he boiled the peanuts rather than roasting them. Kellogg's Western Health Reform Institute served peanut butter to patients because they needed a food that contained a lot of protein, yet which could be eaten without chewing. At first, peanut butter was a food for wealthy people, as it became popular initially as a product served at expensive health care institutes. A Meal Ready to Eat or "MRE kit" which contains peanut butter packets.
4
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Early peanut-butter-making machines were developed by Joseph Lambert, who had worked at John Harvey Kellogg's Battle Creek Sanitarium, and Dr. Ambrose Straub who obtained a patent for a peanut-butter-making machine in 1903."In 1922, chemist Joseph Rosefield invented a process for making smooth peanut butter that kept the oil from separating by using partially hydrogenated oil"; Rosefield "...licensed his invention to the company that created Peter Pan peanut butter" in 1928 and in "...1932 he began producing his own peanut butter under the name Skippy". Under the Skippy brand, Rosefield developed a new method of churning creamy peanut butter, giving it a smoother consistency. He also mixed fragments of peanut into peanut butter, creating the first "chunky"-style peanut butter. In 1955, Procter & Gamble launched a peanut butter named Jif, which was sweeter than other brands, due to the use of "sugar and molasses" in its recipe. As the US National Peanut Board confirms, "Contrary to popular belief, George Washington Carver did not invent peanut butter."Carver was given credit in popular folklore for many inventions that did not come out of his lab. By the time Carver published his document about peanuts, entitled "How to Grow the Peanut and 105 Ways of Preparing it For Human Consumption" in 1916, many methods of preparation of peanut butter had been developed or patented by various pharmacists, doctors and food scientists working in the US and Canada. January 24 is National Peanut Butter Day in the United States.
TYPES: The two main types of peanut butter are crunchy (or chunky) and smooth. In crunchy peanut butter, some coarsely-ground peanut fragments are included to give extra texture. The peanuts in smooth peanut butter are ground uniformly, creating a creamy texture. In the US, food regulations require that any product labelled "peanut butter" must contain at least 90% peanuts; the remaining <10% usually consists of "...salt, a sweetener, and an emulsifier or hardened vegetable oil which prevents the peanut oil from separating". In the US, no product labelled as "peanut butter" can contain "artificial sweeteners, chemical preservatives, [or] natural or artificial coloring additives."Some brands of peanut butter are sold without emulsifiers that bind the peanut oils with the peanut paste, and so require stirring after separation. Most major brands of peanut butter add white sugar, but there are others that use dried cane syrup, agave syrup or coconut palm sugar. Organic and artisanal peanut butters are available, but their markets are small.
5
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Benefits of peanut butter: 1.Rich Source of Protein Peanut butter (100 grams) contains a high amount of protein (25 – 30 grams). Proteins that we eat are broken down into amino acids, which are then utilized in each and every cell for repairing and building the body.
2. Lowers cholesterol levels The fat content in peanut butter is almost equal to that of the fats found in olive oil. It contains both polyunsaturated fats and monounsaturated fats. As these fats are not saturated, they are good to consume without putting the heart at any risk. The unsaturated fats in peanut butter help to lower bad cholesterol levels (low-density lipoprotein) and promote the circulation of good cholesterol (high-density lipoprotein).
3. Prevents type ii diabetes Consuming peanut butter can also be beneficial in reducing the risk of type II diabetes. Peanuts contain not only protein but also unsaturated fats. Unsaturated fats have been noted to improve insulin sensitivity. Research into peanut butter consumption and diabetes showed that a higher intake of peanut butter and other nuts lowers the risk of type II diabetes.
4. Good Source of Vitamins Peanut butter contains many vitamins that are good for our body to function properly. Vitamin A found in it is helpful for eyesight, while vitamin C helps to boost the immune system and heals simple ulcers faster. On the other hand, the vitamin E found in peanut butter is a very important micronutrient needed by our body to dissolve complex fatty acid structures and fat blockages in the arteries.
5. Antioxidant properties Peanut butter contains antioxidant properties due to the presence of folate, niacin, pantothenic acid, pyridoxine, riboflavin, and thiamin. One of the antioxidants found in it is resveratrol. Resveratrol is a polyphenolic antioxidant which has been found to be effective in controlling certain types of cancers, heart disease, Alzheimer’s disease, viral and/or fungal infections, and degenerative nerve diseases.
6. Prevents cancer Peanut butter contains B-sitosterol, a phytosterol that has a great property of fighting against cancer, particularly colon, prostate, and breast cancers. Peanuts and its products, such as peanut oil and peanut butter are ideal sources of phytosterols. 6
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
7. Regulates blood sugar levels Peanut butter is a good source of magnesium (170mg/100 grams). This makes up for 42% of the daily recommended value of magnesium. Magnesium has an important role to play in muscle, bone, and immunity development in the body. Magnesium also helps in regulating blood sugar levels and blood pressure. Its presence in our body helps in more than 300 biochemical reactions that are extremely important for our survival.
8. High in Potassium Peanut butter contains potassium (70 mg/100g) that acts as an electrolyte and is a fluid-balancing element in the body. In comparison to sodium, which directly puts pressure on the cardiovascular system in the form of hypertension, potassium does not put any pressure either on the blood or on the cardiovascular system. In effect, potassium is a heart-friendly element that is found in high quantities in peanut butter.
9. Reduce Risk of Gallstones Gallstones, a major health risk in developed countries, is caused by being overweight, crash diets, certain types of cholesterol drugs, and birth control pills. A study on peanuts and nut consumption relating to the risk of gallstones was undertaken and the results of the study showed that over a period of 2 decades, women who consumed peanut butter and nuts on a regular basis had reduced their risk of developing gallstones.
10. Rich in Dietary Fiber Peanuts and peanut butter are both high in dietary fiber. One cup or approximately 125 g of peanuts and peanut butter has 12 g and 20 g of dietary fiber, respectively. Dietary fiber is one of the most important parts of our diet since a lack of dietary fiber can lead to several health problems and diseases such as constipation, diabetes, cholesterol, and various heart diseases.
Production Process Planting and harvesting: Peanuts are usually planted in Kharif. The peanut comes from a yellow flower which bends over and infiltrates the soil after blooming and wilting, and the peanut starts to grow in the soil. Peanuts are harvested from late August to October, while the weather is clear. This weather allows for dry soil so that when picked, the soil does not stick to the stems and pods. The peanuts are then removed from vines and transported to a peanut shelling machine for mechanical drying. After cropping, the peanuts are delivered to warehouses for cleaning, where they are stored unshelled in silos. 7
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
1.Shelling The most important thing about shelling is to remove the shell of peanuts with the smallest damage to the seed. The moisture of the unshelled peanuts is controlled to avoid excessive frangibility of the shells and kernels, which in turn, reduces the amount of dust present in the plant. After, the peanuts are sent to a series of rollers set specifically for the batch of peanuts, where they are cracked. After cracking, the peanuts go through a screening process where they are inspected for contaminants.
2.Roasting The dry roasting process employs either the batch or continuous method. In the batch method, peanuts are heated in large quantities in a revolving oven at about 426.6℃. Next, the peanuts in each batch are uniformly held and roasted in the oven at 160℃ for about 40 to 60 minutes. This method is good to use when the peanuts differ in moisture content. In the continuous method, a hot air roaster is employed. The peanuts through the roaster whilst being rocked to permit even roasting. A photometer indicates the completion of dry roasting.This method is favoured by large manufacturers since it can lower the rate of spoilage and requires less labor.
3.Cooling After dry roasting, peanuts are removed from the oven as quickly as possible and directly placed in a blower-cooler cylinder. There are suction fans in the metal cylinder that can pull a large volume of air through, so the peanuts can be cooled more efficiently. The peanuts will not be dried out because cooling can help retain some oil and moisture. The cooling process is completed when the temperature in the cylinder reaches 30℃.
4.Blanching After the kernels have been cooled down, the peanuts will undergo either heat blanching or water blanching to remove the remain seed coats. Compared to heat blanching, water blanching is a new process. Water blanching first appeared in 1949.
5.Heat blanching Peanuts are heated by hot air at 280 degrees Fahrenheit (137.8 degrees Celsius) for not more than 20 minutes in order to soften and split the skins. After that, the peanuts are exposed to continuous steam in a blanching machine. The skins are then removed using either bristles or soft rubber belts. After that, these skins are separated and blown into waste bags. Meanwhile, the hearts of peanuts are segregated through inspection.
6.Water blanching After the kernels are arranged in troughs, the skin of the kernel is cracked on opposite sides by rolling it through sharp stationary blades. While the skins are removed, the kernels are brought 8
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
through a one-minute hot water bath and placed on a swinging pad with canvas on top. The swinging action of the pad rubs off the skins. Afterward, the blanched kernels are dried for at least six hours by hot air at 120 degrees Fahrenheit (48.8 degrees Celsius). After blanching, the peanuts are screened and inspected to eliminate the burnt and rotten peanuts. A blower is also used to remove light peanuts and discoloured peanuts are removed using a colour sorting machine.
7.Grinding After blanching the peanuts are sent to grinding to be manufactured into peanut butter. The peanuts are then sent through two sizes of grinders. The first grinder produces a medium grind, and the second produces a fine grind. At this point, salt, and a vegetable oil stabilizer are added to the fine grind to produce the peanut butter. This adds flavour and allows the peanut butter to stay as a homogenous mixture. Chopped peanuts may also be added at this stage to produce “chunky” peanut butter. 8.Packaging Before packaging, the peanut butter must first be cooled in order to be sealed in jars.The mixture is pumped into a heat exchanger in order to cool it to about 48.8 degrees Celsius. Once cool, the peanut butter is pumped into jars and vacuum sealed. This vacuum sealing rids the container of oxygen so that oxidation cannot occur, preserving the food. The jars are then labelled and set aside until crystallization occurs. The peanut butter is then packaged into cartons distributed to retailers, where they are stored at room temperature and sold to consumers. A 2012 article stated that "China and India are the first and second largest producers, respectively", of peanuts. The United States of America "...is the third largest producer of peanuts (Georgia and Texas are the two major peanut-producing states)"and "more than half of the American peanut crop goes into making peanut butter."
Manufacturing process
9
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Nutritional profile Calories-588 (Amount-100gm.)
(amount-100 gm.)
% Daily Value* Total Fat
50 g
Saturated fat 10 g Polyunsaturated fat 14 g Monounsaturated fat 24 g Cholesterol
0 mg
Sodium
17 mg
Potassium
649 mg
Total Carbohydrate
20 g
Dietary fiber 6 g Sugar 9 g Protein
25 g
Vitamin A(eyesight)
0%
Vitamin C
0%
Calcium
4%
Iron
10%
Vitamin D
0%
Vitamin B-6
25%
Vitamin B-12
0%
Magnesium
38%
10
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Peanut allergy For people with a peanut allergy, peanut butter can cause a variety of possible allergic reactions, including life-threatening anaphylaxis. This potential effect has led to banning peanut butter, among other common foods, in some schools.
Market potential •
Indian peanuts are popular all over the world with large exports every year.
•
But unfortunately, our market share is primarily confined to raw peanuts and value added products like blanched and roasted or peanut butter have very negligible contribution
•
Peanut butter has high penetration in western countries market as compared to AsiaPacific region due to lack of awareness about the benefits associated with peanut butter
•
Growing awareness about the autoimmune diseases such as celiac disease is raising the need of low calorie nutritional food thus increasing the demand of peanut butter across globe.
•
The global peanut butter market is estimated to reach value USD 6.73 billion and is expected to grow at a CAGR 10% over the forecast period i.e. 2016-2024
•
Asia-Pacific peanut butter market is expected to reach USD 1 billion in 2024 and is projected to grow at a CAGR of 13% the during the time period of 2016 to 2024 due to the influence of US culture using peanut butter as a staple food.
•
Peanut Butter is part of the staple break-fast food in US. Statistics says that about 89% of the entire US households consume it as bread spread. This is further evident from the fact that about one-third of the US peanut harvest is utilized for manufacturing peanut butter.
•
From an international perspective it is shown that revenue of peanut butter generated in the United States (US$1,961m in 2017)
•
The consumption of peanut butter is also high in the countries like Philippines, South Korea, Canada, etc. as they are well influenced by US culture
•
As an increment in population of working women in India encourages the market for ready to eat products in which peanut butter is an important player.
11
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Product life cycle •
Introduction stage.
•
New product in retail market.
•
Riskiest stage of life-cycle.
•
Little direct competition.
Product strategy •
Spicy peanut butter as the “star” of its product line. 12
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006 •
This flavor is offered by international brands such as Jif and Skippy but is not produced by any local food processors.
Peanut butter product line. Peanut Butter
Flavors primary consumer
Purchaser/Decision- Maker
Regular
Adults and children
Mothers/Wives
Spicy (principal flavor)
Adults
Mothers/Wives
Sweetened
Children
Mothers
Pricing strategy: •
Our approach is “existing product in new market” for domestic markets & “existing product in existing market” for export markets.
•
The ideal pricing strategy will be Value Based Pricing in which we would win customers by charging low price and high quality to attract customers and expand our market share.
Markets for G-lite foods Products: •
Retailers—supermarkets, convenience stores, artisan markets, specialty stores, informal market vendors
•
Institutional customers—restaurants, hotels, organizations, agencies, trade groups, schools, etc.
•
Production center—selling wholesale from production site
•
Individuals—clients/employees of G-lite foods sell to individual friends, family and community
Distribution Strategy of G-lite organization: 13
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Financial plan: • Capital investment Land and building –
Land 1500 m2
–
Construction area 1000m2
–
Cost of construction 42 lakh
–
Cost of land 105 lakh
Plant and machinery -
groundnut shelling capacity 10 tone per shift Blanching capacity 5 tone per shift Roasting capacity 5 tone prr shift Peanut butter making capacity 5 tone per shift Estimated values of plant and machinery 14
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
-
Estimated values of plant and machinery: ITEM/MACHINE
QUANTITY
PRICE (Rs)
Elevator
2
70000
Pre-cleaner
1
468000
Destoner
1
315000
Vibratory Screw
1
30000
Opener
1
45000
Slotting Screen
1
30000
Picking/Sorting tables
4
500000
Vibrating Screens
1
40000
Radiant Ray Roaster
1
1200000
Cooling Seive
1
50000
Whole Nut Blancher
1
500000
Chamberless vacuum Packing Machine
1
150000
Air Compressor
1
35000
Split Nut Blancher
1
500000
Peanut Butter Mill
2
1000000
SS Holding Tank with Stirrer & Butter Pump
1
225000
Stabilizer Feeder
1
100000
Ingredient Feeder
1
100000
Ribbon Blender
1
150000
Scrape Surface Heat Exchanger
1
3000000
Ammonia Plant
1
1000000
SS Piping Kit
100000
PistonFiller For Butter Packing
1
300000 12289600
Total 15
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Taxes, Transportation, Electrification & Installation
2000000
Total
14289600
Estimated expenditure of manpower:
Particulars
Total Salary (Rs)
Monthly Salary (Rs/Person)
Nos
Works Manager
1
14000
14000
Supervisor
2
10000
20000
Machine Operators/Mechanic
3
9000
27000
Skilled Workers
3
7000
21000
Semi-skilled Workers
3
6000
18000
Helpers
5
6000
30000
Personnel Manager
1
8000
8000
ant
1
7000
7000
Clerk
1
6000
8000
Peon
2
4000
7000
Watchman
1
4500
2500
Electrician
1
4500
2500
Total
38
Tentative Implementation Schedule:
16
168000
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Activity
Period (months)
Application and Sanction of Loans
2
Site Selection and Commencement of Work
1
Completion of Civil Work & Placement of orders for machinery
4
Erection, Installation and Trials Runs
1
Estimated value of land and building:
Particulars
Area (sq. m)
Cost (Rs. In lakh)
Land
1500
105
Building
1000
42 147
Total
Working capital requirement:
Particulars
Period
(months)
Margin
Total
(Rs in Lakhs)
17
Bank
Promoters
(Rs in Lakhs)
(Rs in Lakhs)
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Stock of raw and packing material
1
Other Expenses
1
20%
Total
184.26
147.41
36.84
5
0
5
189.26
147.41
41.84
Cost of project and means of finance:
Item/Particulars
Amount
Land and Building
14700000
Machinery
14289600
Miscellaneous Assets
500000
Preliminary & Pre-operative Expenses
2000000
Contingences at 10% on Land & Building and Plant & Machinery
2698900
Working Capital
18926000
Total
53114500
Means of Finance Promoter's Contribution
12747500
Term Loan From bank
40367000
Total
53114500
Debt Equity Ratio
3:1 18
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Promoter's Contribution
24%
Estimated sales value: Product
Quantity (ton)
Peanut Butter
Price/ton (Rs)
Sales value (in Lakh)
1000
260000
2600
220
3750
8.25
Husk Total
2608.25
Estimated expenditure of raw material: Product
Quantity(ton)
Price/ton(Rs.)
Sales value(in Lakh)
Peanut butter Husk Total
1000 220
260000 3750
2600 8.25 2608.25
Interest on term loan of Rs 21441000 is calculated at 13% per annum assuming complete repayment in 5 years including a moratorium period of 6 months Interest on Term Loan: Term loan = Total Loan – Working Capital = 40367000-18926000 = 21441000 Rs. Moratorium period of 6 months Repayment of loan in 54 months
Loan and interest for 5 years: 19
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Loan Year Amount of loan in starting of year
Repayment
Loan at the end of year
Interest at 13%
Year 1
Year 2
Year 3
Year 4
Year 5
21441000
18224850
12650190
7075530
1072050
3216150
5574660
5574660
6003480
1211420
18224850
12650190
7075530
1072050
-
2787330
2369230
1644525
919820
139370
Interest on working capital of 3 years:
Year 1
Year 2
Year 3
Working Capital
18926000
18926000
18926000
Interest at 14%
2649000
2649000
2649000
Depreciation of 2 years : Cost 1st Year Building (10%)
Depreciation 2nd Year
4200000
3780000
20
1st Year 420000
2nd Year 378000
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Machinery (20%)
14289600
11431680
2857920
2286336
500000
400000
100000
80000
3377920
2744336
Miscellaneous Assets (20%) Total Depreciation
Projected Profitability: (Rs. In lakhs) No.
Particulars
1st Year
A
Installed capacity
1000 tonnes
Capacity Utilisation
60%
75%
1564.95
1956.18
564.78
705.97
Utilities
5.00
6.00
Salaries
20.04
23.10
8
9.2
12.00
14.00
Selling & distribution expenses
6
7
istration expenses
8
9
Total
623.82
774.27
Profit Before Interest & Depreciation
941.13
1181.91
Interest on Term Loan
27.87
23.70
Interest on Working Capital
26.49
26.49
Depreciation
33.71
27.45
Sales Realization B
Cost of Production Raw and Packing Materials
Stores and Spares Repairs & Maintenance
C
2nd Year
21
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
Profit Befor Tax
853
1104.27
Income tax at 33%
281.49
364.41
Cash Accurals
571.51
739.86
32.16
55.75
Repayment of Term Loan
Break even analysis: No.
Particulars
A
Sales
B
Variable Cost
Amount (Rs. In lakhs) 1564.95
Raw and packaging materials
570.10
Utilities
5
Stores and Spares
8
Selling and distribution
8
Total
591.1
C
Contribution (A-B)
972.9
D
Fixed Cost Salary
20.04
istration Cost
8
Repairs and Maintenance
12
Interest on term loan
27.87
Interest on Working Capital
26.49
Depreciation
33.71
Total
128.11 22
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
•
Break-even Sales It is the amount of sales sufficient to reach the break even point Fixed cost BES=
_______________ PV ratio
Contribution PV =
________________ X 100 Sales revenue
972.9 PV
=
_______________ X 100
=
Rs. 62.17
1564.95
128.11 Break even sales
= _________________ X 100 62.17
=
Rs. 20606400
Return on investment [ROI]: Return on investment is the average return one investor gets from his total investment.
23
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
EBIT ROI =
_________________
X
100
Capital employed
35817000 ROI
=
-------------------- X
100 = 67.45 %
53114500
Payback Period of the project: It is the period required for an investor to get back all the money he has invested in one business.
Total Project Cost
53114500
------------------------
= -------------
Average Cash Flow
27010000
= 1.97 years
Market feasibility % Increase in cost
Particular
Increase in production cost (in lakh)
Increase or decrease level of profit
10%
land & building
28.98 lakh
2% decrease
10%
plant & machinery
14.28 lakh
1.7% decrease
24
Institute of Agri Business Management Swami Keshwanand Rajasthan Agricultural University, Bikaner- 334006
20%
land & building
57.97 lakh
4% decrease
20%
plant & machinery
28.56 lakh
3.4% decrease
10%
raw material
94.13 lakh
13.7% decrease
20%
raw material
188.23 lakh
27.5% decrease
Reference: https://en.wikipedia.org/wiki/Peanut_butter https://www.organicfacts.net/health-benefits/seed-and-nut/health-benefits-of-peanut-butter.html http://www.insidertradings.org/2017/12/18/peanut-butter http://dasfoodindia.com/2017/01/24/peanut-butter-market-in-india/ timesofindia.indiatimes.com/city/ahmedabad/Gujarat-leads-peanut-butter-production
25
Related Documents 171j1w
Business Plan On Peanut Butter 5y6xd
December 2021 0
Amway Peanut Butter 1f1k46
December 2019 27
Assignment On Business Plan 201k2
October 2019 77
Business Plan On Bagasse 1p6q3m
November 2019 53
Business Plan On Henna 114028
October 2021 0
Business Plan On Bangles 5m156s
November 2019 41More Documents from "vivek" 2d1ul
Obmoviepresentation Sarfarosh 120724060152 Phpapp02 414957
April 2021 0
Ps Nvision h5558
April 2022 0
Herman Miller Case Analysis 3xc2a
December 2019 205
Visionplus Interview Questions 44174e
November 2021 0
Astrologers Cheatsheet.pdf 4j4fn
December 2021 0