Introduction

Project report for soap manufacturing is as follows:

Toilet soaps became a part of our daily life, not only because of its cleaning properties but also due to its cosmetic aspects. The necessary raw materials are needed to be of high purity and the finished product should have the balanced pH as its froth may enter the eye. Toilet soaps are made by combining liquid fats (like vegetable oils or animal fat) with an alkali like sodium hydroxide (also called lye). The process is called saponification; the definition of saponification is literally to turn fat or oil into soap by reaction with an alkali. During the curing process, the sodium hydroxide and water evaporate out of the product, leaving behind just awesome soap. Superfatting, which refers to the process of adding liquid fats to soap after saponification, is popular for its rich, moisturizing effect. Clear soaps will add glycerin and sorbitol (a sugar alcohol with emollient properties), and products labeled antibacteria usually rely on triclosan, a substance that kills bacteria and helps prevent fungus growth. A simple production method with high return soaps are invariably used in every household. The antibacterial soap with a moisturizer added has huge market potential. The market is spread from remote village to the metro cities alike. The industry gives a good profit and high employment oriented.

Product / Services & process

The products are toilet soaps of differnt frangance and colour. They are ; Sandal, Lemon, Lavendor and Turmeric. Speciality of the products are they are hand made and glicerin soaps. They have mindglowing fragrance and attractive packing. Customers will be easily attracted. Soap making process is called saponification. Saponification process is the reaction of castic soda with fatty acids, like vegitable oils. Soap poder, which is an inert filler is added to it as an abbrasiive. Beauty of the soap is colour and suitable colour is mixed at the end of saponification process. Fragrance is very important and it is added to the mix at last, so that it will lasting and remain fresh.

Raw materials / Consumables

Raw material selection is very important in determining the quality and price of a product. If the raw material quality is low, the products made of them cannot be of superior quality. At the same time, materials with lower prices to be identified. The raw materials required for the production of toilet soaps are:

1) Caustic soda or Sodium Hydroxide

2) Vegitable oil, mainly coconut oil

3) Soap powder, id stone powder or white clay powder

4) Colour

5) Perfumes

6) Butter paper

7) Paper cover for packing

These raw materials are procured from genuine suppliers so that quality and low orice can be ensured.

Plant & Machinery / Equipments

Machinery for toilet soap manufacturing are:

Soap Mixer machine

Reciprocating soap cutting machine

Foot operated stamping machine

Mould set

vessels and dishes

Market potential & Strategy

Most of the Indians take bath daily as are very much concious about the personal cleanliness . Apart from the aspect of cleaning the body, bath is linked to our culture, traditions and religious cerimonies. Without taking bath devottees usually donot enter into holy places. Lots of soap brands are available in the market. But a new product will be surely welcomed by the market in search of variety. Once this acid test is passed by a product, its future will be fabulous. Quality products will sustain in the market. A cheap but quality product like this has great scope in the market.

But most of the customers donot stick on to a particular brand of soap only for a long time. Each time they purchase soaps, they try differnt brands accoring to price, fragrance, packaging and advertisment. Those brands they felt have quality, would prefer to buy next time, thats all.Ttherefore a new product will attract some of the customers and some of the users will prefer to buy it.Almost all people use soapsin India while taking bath and the lifespan of a soap is hardly 10 days. That means, every family is a customer of around 35 soaps a year. If maximum margin is ensured to the retailer, they will defenitely introduce it to the customer and persuade to buy it. therefore market potential of this hand made, glycerine soap will be defenitely high.Growing number of Indian consumers is showing preference for premium bathing products and thus the body wash and shower segment is expected to grow with a CAGR of more than 15% over the next four years.

Project at a glance

Name & Address of Unit

Soap Manufacturing

Address

Details of unit

Email	:	[email protected]
Phone	:	944700000
Constitution	:	Proprietership
Total project cost	:	*******
Fixed Capital	:	*******
Working Capital	:	*******
Total Bank loan	:	*******
Promoter(s) contribution	:	*******
Term loan	:	*******
Working capital loan	:	*******

Name & address of promoter(s)

Name		: Yourname
Address		: Your address
Designation		: Proprietor
E-mail		: [email protected]

Project Feasibility Ratios

Debt Service Coverage Ratio (Average)

:1.87

Current ratio (Average)

:2.63

	Year 1	Year 2	Year 3	Year 4	Year 5
Current ratio	1.53	2.06	2.62	3.19	3.76
Quick ratio	1.13	1.56	2.10	2.64	3.18
Interest coverage ratio	3.87	5.55	7.00	9.48	14.71
Debt equity ratio	2.863	2.080	1.528	1.020	0.542
TOL/TNW	3.02	1.45	0.79	0.43	0.21
DSCR	1.65	1.86	1.90	1.94	1.97
Gross profit Sales Percentage %	29.23 %	28.54 %	28.18 %	27.86 %	27.50 %
Net profit Sales Percentage %	10.84 %	10.56 %	11.10 %	11.57 %	11.90 %
BEP in % of installed capacity %	49.90 %	27.12 %	27.12 %	27.12 %	27.12 %
BEP in sales of Rs	2,620,800.00	1,840,695.65	1,972,173.91	2,103,652.17	2,235,130.43
Return On Capital Employed	0.26	0.34	0.34	0.33	0.33

Project Feasibility graph

Net profit Sales %

Quick ratio

Revenue v/s Expense

Expense Splitup

Project Cost

Sl. no	Item	Amount Rs
1	Building rent advance	*******
2	Vessels and dishes	*******
3	Mould set	*******
4	Foot operated stamping machine	*******
5	Reciprocating soap cutting machine	*******
6	Soap Mixer machine	*******
7	Eectrification	*******
8	Preliminary expenses	*******
9	Working Capital	*******
	Total	*******

Working Capital Computation

Sl. no	Item	Amount Rs
1	Consumables / stock in hand	*******
2	Work in progress	*******
3	Finished goods	*******
4	Working expense.	*******
5	Receivables/Sundry debtors	*******
6	Payables	*******
7	Total working capital	*******
8	Own Contribution	*******
9	Working capital loan	*******

Annual Sales / Revenue

Sl. no	Item	Rate		Quantity	Unit	Total Rs
1	Toilet soaps of five fragrance	*******	X	180000	Number	*******
	Total					*******

Total Yearly Expense

Sl. no	Item	Amount Rs
1	Rent	*******
2	Production staff	*******
3	Electricity chaeges	*******
4	Office expense, stationery	*******
5	Raw Materials	*******
6	Wages for 2 workers	*******
7	Marketing/Advertisement	*******
	Total	*******

Application of Fund

Sl. no	Item	Subsidy %	No.	Rate	Amount Rs
1	Building rent advance	*******	1	*******	*******
2	Vessels and dishes	*******	1	*******	*******
3	Mould set	*******	1	*******	*******
4	Foot operated stamping machine	*******	1	*******	*******
5	Reciprocating soap cutting machine	*******	1	*******	*******
6	Soap Mixer machine	*******	1	*******	*******
7	Eectrification	*******	1	*******	*******
8	Preliminary expenses	*******	1	*******	*******
	Total Investment				*******
	Total Subsidy				*******
	Net Investment				*******

Means of Finance

Sl. no	Item	Amount
1	Term Loan	*******
2	Working capital Loan	*******
3	Total loan	*******
4	Term Loan contribution	*******
5	Working capital contribution	*******

Profitability Statement

		Year 1(!*)	Year 2	Year 3	Year 4	Year 5
Revenue from operation
Sales	15.93	*****	*****	*****	*****	*****
Add :
Closing stock		*****	*****	*****	*****	*****
Total		*****	*****	*****	*****	*****
Less :
Opening stock		*****	*****	*****	*****	*****
Stock purchase	7.20	*****	*****	*****	*****	*****
Salary	3.60	*****	*****	*****	*****	*****
Repairs and maintenance charges	0.24	*****	*****	*****	*****	*****
gas	0.12	*****	*****	*****	*****	*****
ELECTRICITY bill	0.12	*****	*****	*****	*****	*****
Total		*****	*****	*****	*****	*****
Gross profit		*****	*****	*****	*****	*****
Less :
Rent	0.12	*****	*****	*****	*****	*****
Telephone/Postal &internet charge	0.12	*****	*****	*****	*****	*****
Total		*****	0*****	*****	*****	*****
Depreciation		*****	*****	*****	*****	*****
Interest on TL		*****	*****	*****	*****	*****
Interest on WC		*****	*****	*****	*****	*****
Total		*****	*****	*****	*****	*****
Profit before tax		*****	*****	*****	*****	*****
Income Tax		*****	*****	*****	*****	*****
Profit after tax		*****	*****	*****	*****	*****

Cash flow statement

Cash Inflow	Pre operative period	Year 1	Year 2	Year 3	Year 4	Year 5
Capital	0.63	*****	*****	*****	*****	*****
Subsidy	*****	*****	*****	*****	*****	*****
Termloan	*****	*****	*****	*****	*****	*****
Profit before tax with interest	*****	*****	*****	*****	*****	*****
Increase in WC loan	*****	*****	*****	*****	*****	*****
Depreciation	*****	*****	*****	*****	*****	*****
Increase in Current liability	*****	*****	*****	*****	*****	*****
Total Cash Inflow	*****	*****	*****	*****	*****	*****
Cash Outflow
Fixed Assets	*****	*****	*****	*****	*****	*****
Increase in Current asset		*****	*****	*****	*****	*****
Interest on TL	*****	*****	*****	*****	*****	*****
Interest on WC	*****	*****	*****	*****	*****	*****
Income Tax	*****	*****	*****	*****	*****	*****
Decrease in Term loan		*****	*****	*****	*****	*****
Drawing	*****	*****	*****	*****	*****	*****
Total Cash Outflow	*****	*****	*****	*****	*****	*****
Opening balance	*****	*****	*****	*****	*****	*****
Net Cashflow	*****	*****	*****	*****	*****	*****
Closing balance	*****	*****	*****	*****	*****	*****

Balance sheet

Liability	Pre operative period	Year 1	Year 2	Year 3	Year 4	Year 5
A. Share holders funds
Capital	*****	*****	*****	*****	*****	*****
Reserve & Surplus	*****	*****	*****	*****	*****	*****
B.Non current Liabilities
Termloan	*****	*****	*****	*****	*****	*****
C.Current Liabilities
Working capital loan	*****	*****	*****	*****	*****	*****
Account payable		*****	*****	*****	*****	*****
Total Liability	*****	*****	*****	*****	*****	*****
Asset
A. Non current Assets
Fixed Assets	*****	*****	*****	*****	*****	*****
B. Current Assets
Inventory	*****	*****	*****	*****	*****	*****
Trade receivables	*****	*****	*****	*****	*****	*****
Cash and cash equivalence	*****	*****	*****	*****	*****	*****
Total Asset	*****	*****	*****	*****	*****	*****

Repayment of Term loan

Year	Installment	Outstanding at the beginning	Principal repayment	Interest	Amount paid	Outstanding at the end
1	1	*****	*****	*****	*****	*****
1	2	*****	*****	*****	*****	*****
1	3	*****	*****	*****	*****	*****
1	4	*****	*****	*****	*****	*****
1	5	*****	*****	*****	*****	*****
\|	\|	\|	\|	\|	\|	\|
\|	\|	\|	\|	\|	\|	\|
5	56	*****	*****	*****	*****	*****
5	57	*****	*****	*****	*****	*****
5	58	*****	*****	*****	*****	*****
5	59	*****	*****	*****	*****	*****
5	60	*****	*****	*****	*****	*****

Debt Service Coverage Ratio

Particulars	Year 1	Year 2	Year 3	Year 4	Year 5
Receipts
a).Net Profit	*****	*****	*****	*****	*****
b).Depreciation	*****	*****	*****	*****	0.30
c).Interest on termloan	*****	*****	*****	*****	*****
Total	*****	*****	*****	*****	*****
Repayments
a).Loan Principal	*****	*****	*****	*****	*****
b).Interest on termloan	*****	*****	*****	*****	*****
Total	*****	*****	*****	*****	*****
DSCR	*****	*****	*****	*****	*****

Depreciation

Particulars	Rate	Year 1	Year 2	Year 3	Year 4	Year 5
Building	*****	*****	*****	*****	*****	*****
Less Depreciation		*****	*****	*****	*****	*****
Written down value		*****	*****	*****	*****	*****
Computers/ Printers /Photocopier/Electronic gadget	00	*****	*****	*****	*****	*****
Less Depreciation		*****	*****	*****	*****	*****
Written down value		*****	*****	*****	*****	*****
Furniture & fixtures	00	*****	*****	*****	*****	*****
Less Depreciation		*****	*****	*****	*****	*****
Written down value		*****	*****	*****	*****	*****
Racks & storage/Interior works	00	*****	*****	*****	*****	*****
Less Depreciation		*****	*****	*****	*****	*****
Written down value		*****	*****	*****	*****	*****
new item	00	*****	*****	*****	*****	*****
Less Depreciation		*****	*****	*****	*****	*****
Written down value		*****	*****	*****	*****	*****
new	00	*****	*****	*****	*****	*****
Less Depreciation		*****	*****	*****	*****	*****
Written down value		*****	*****	*****	*****	*****
Air-conditioning	00	*****	*****	*****	*****	*****
Less Depreciation		*****	*****	*****	*****	*****
Written down value		*****	*****	*****	*****	*****
Other investments	00	*****	*****	*****	*****	*****
Less Depreciation		*****	*****	*****	*****	*****
Written down value		*****	*****	*****	*****	*****
Total less depreciation		*****	*****	*****	*****	*****
Total written down value		*****	*****	*****	*****	*****

Conclusion

The project as a whole describes the scope and viability of the Trading industry and mainly of the financial, technical and its market potential.The project guarantee sufficient fund to repay the loan and also give a good return on capital investment. When analyzing the social- economic impact, this project is able to generate an employment of 5 and above. It will cater the demand of Trading and thus helps the other business entities to increase the production and service which provide service and support to this industry. Thus more cyclic employment and livelihood generation. So in all ways, we can conclude the project is technically and socially viable and commercially sound too.

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