Project report for Laundry/Dryclean Center

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Introduction

Laundry market’s size in India is estimated at a billion dollars in the organized sector and in the unorganized sector at a whopping 30 billion dollars Time poverty of busy working classes and rising disposable income are factors prompting urban Indians to opt for the laundry services. The days when laundry was considered to be “unorganized” have been put in the past. Nowadays, India sees rapid growth in the organised laundry sector in various parts. Since the lifestyle of people is changing, they are looking for options other than their local dhobis for their clothes. Previously, dry cleaning was restricted to only to the people belonging to the upper echelon of the society. But now a days even the average middle-class family also needs dry cleaning and machine wash services for their garments. Opening a new laundry with all the proper equipment and facilities will set you back by a minimum of 10 lacs. With the initial investment and subsequent revenue generation, you will reach the break-even point after one and a half years. Since the laundry business in India is so much in demand, you can expect to have a profit percentage of 40%-100% reaching the break-even point. Hence, this is one sector where a minimal investment can give you the maximum benefits in the shortest amount of time. With very small space for differentiation, players are resorting to discounts and price cuts. To attract customers, some are giving a free credits and some are offering free first wash.

 

Product / Services & process

The laundry is planning to offer the dry cleaning service to people over the town. This firm stands for quality and commitment to the customers. The firm is working on the principles of quality management and time bound delivery to the customers. The firm is positioned itself as a quality service provider with affordable pricing. The main focus of the firm is the hotels, middle class working group etc.

 

Market potential & Strategy

Since opening a laundry business in India does not take much training or prior experience in the field, venturing into it is not a difficult task. However, with so many new laundries making their way into the market, the important thing is to uphold your position in the business. Even though customers are easily available and the market is a lucrative one, even a single mistake can cost you your customer to the competition. Also one of the potential areas of problem for your laundry can be covering delivery charges. Often due to a large distance, delivering the laundered clothes to the customers can become a liability and eat into your profit margin. So it is best to make smart choices while investing in the laundry business.Having a target clientele can make it much easier for you to determine the area you want to expand your business to. Hiring a mode of transport for delivering the clothes can cut back on your expenditure by quite a margin. And most importantly, leaving no stone unturned in delivering top-notch service is the key to keep your laundry’s name in everyone’s radar.With very small space for differentiation, players are resorting to discounts and price cuts. To attract customers, some are giving a free credits and some are offering free first wash.With very small space for differentiation, players are resorting to discounts and price cuts. To attract customers, some are giving a free credits and some are offering free first wash.Laundry market’s size in India is estimated at a billion dollars in the organized sector and in the unorganized sector at a whopping 30 billion dollars Time poverty of busy working classes and rising disposable income are factors prompting urban Indians to opt for the laundry services. The days when laundry was considered to be “unorganized” have been put in the past. Nowadays, India sees rapid growth in the organised laundry sector in various parts. Since the lifestyle of people is changing, they are looking for options other than their local dhobis for their clothes. Previously, dry cleaning was restricted to only to the people belonging to the upper echelon of the society. But now a days even the average middle-class family also needs dry cleaning and machine wash services for their garments. Opening a new laundry with all the proper equipment and facilities will set you back by a minimum of 10 lakhs.

The firm positioned itself as a quality oriented company which offers affordable cost to customers. The main mode of marketing is through news paper inserts, local advertisements in residence association and local channels. The firm also offers quality challenge contents in socialmedia , so that the branding will reach to working class youth.

 

PROJECT REPORT

Laundry/Dryclean Center

Address

Introduction

Laundry market’s size in India is estimated at a billion dollars in the organized sector and in the unorganized sector at a whopping 30 billion dollars Time poverty of busy working classes and rising disposable income are factors prompting urban Indians to opt for the laundry services. The days when laundry was considered to be “unorganized” have been put in the past. Nowadays, India sees rapid growth in the organised laundry sector in various parts. Since the lifestyle of people is changing, they are looking for options other than their local dhobis for their clothes. Previously, dry cleaning was restricted to only to the people belonging to the upper echelon of the society. But now a days even the average middle-class family also needs dry cleaning and machine wash services for their garments. Opening a new laundry with all the proper equipment and facilities will set you back by a minimum of 10 lacs. With the initial investment and subsequent revenue generation, you will reach the break-even point after one and a half years. Since the laundry business in India is so much in demand, you can expect to have a profit percentage of 40%-100% reaching the break-even point. Hence, this is one sector where a minimal investment can give you the maximum benefits in the shortest amount of time. With very small space for differentiation, players are resorting to discounts and price cuts. To attract customers, some are giving a free credits and some are offering free first wash.

Product / Services & process

The laundry is planning to offer the dry cleaning service to people over the town. This firm stands for quality and commitment to the customers. The firm is working on the principles of quality management and time bound delivery to the customers. The firm is positioned itself as a quality service provider with affordable pricing. The main focus of the firm is the hotels, middle class working group etc.

Market potential & Strategy

Since opening a laundry business in India does not take much training or prior experience in the field, venturing into it is not a difficult task. However, with so many new laundries making their way into the market, the important thing is to uphold your position in the business. Even though customers are easily available and the market is a lucrative one, even a single mistake can cost you your customer to the competition. Also one of the potential areas of problem for your laundry can be covering delivery charges. Often due to a large distance, delivering the laundered clothes to the customers can become a liability and eat into your profit margin. So it is best to make smart choices while investing in the laundry business.Having a target clientele can make it much easier for you to determine the area you want to expand your business to. Hiring a mode of transport for delivering the clothes can cut back on your expenditure by quite a margin. And most importantly, leaving no stone unturned in delivering top-notch service is the key to keep your laundry’s name in everyone’s radar.With very small space for differentiation, players are resorting to discounts and price cuts. To attract customers, some are giving a free credits and some are offering free first wash.With very small space for differentiation, players are resorting to discounts and price cuts. To attract customers, some are giving a free credits and some are offering free first wash.Laundry market’s size in India is estimated at a billion dollars in the organized sector and in the unorganized sector at a whopping 30 billion dollars Time poverty of busy working classes and rising disposable income are factors prompting urban Indians to opt for the laundry services. The days when laundry was considered to be “unorganized” have been put in the past. Nowadays, India sees rapid growth in the organised laundry sector in various parts. Since the lifestyle of people is changing, they are looking for options other than their local dhobis for their clothes. Previously, dry cleaning was restricted to only to the people belonging to the upper echelon of the society. But now a days even the average middle-class family also needs dry cleaning and machine wash services for their garments. Opening a new laundry with all the proper equipment and facilities will set you back by a minimum of 10 lakhs.

The firm positioned itself as a quality oriented company which offers affordable cost to customers. The main mode of marketing is through news paper inserts, local advertisements in residence association and local channels. The firm also offers quality challenge contents in socialmedia , so that the branding will reach to working class youth.

Project at a glance

Name & Address of Unit

Laundry/Dryclean Center

Address

Details of unit
Email : youremail@gmail.com
Phone : 000000
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 : Your Name
Address : Address
Phone : 0000
Designation : Proprietor
E-mail : youremail@gmail.com

Project Feasibility Ratio

Debt Service Coverage Ratio (Average) :1.87
Current ratio (Average) :2.63
Year 1Year 2Year 3Year 4Year 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

Revenue v/s Expense Expense Splitup
 
Revenue
 
Expense
Net profit Sales % Quick ratio

Project Cost

Sl. no Item Amount Rs
1 Dry clean machine *******
2 Computer & printer *******
3 Electrification *******
4 Preliminary expenses *******
5 Advertising &publicity *******
6 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 Revenue from Sales ******* X 4800 Number *******
Total *******

Total Yearly Expense

Sl. no Item Amount Rs
1 Rent *******
2 Ironing staff *******
3 Dry cleaning staff *******
4 Reception *******
5 Electricity *******
6 Raw materials *******
7 Travel expenses *******
8 Marketing/Advertisement *******
Total *******

Application of Fund

Sl. no Item Subsidy % No. Rate Amount Rs
1 Dry clean machine ******* 1 ******* *******
2 Computer & printer ******* 1 ******* *******
3 Electrification ******* 1 ******* *******
4 Preliminary expenses ******* 1 ******* *******
5 Advertising &publicity ******* 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 ***** ***** ***** ***** *****
Add :
Closing stock 0.00 0.00 0.00 0.00 0.00
Total ***** ***** ***** ***** *****
Less :
Opening stock 0.00 0.00 0.00 0.00 0.00
Stock purchase ***** ***** ***** ***** *****
Salary ***** ***** ***** ***** *****
Repairs and maintenance charges ***** ***** ***** ***** *****
gas ***** ***** ***** ***** *****
ELECTRICITY bill ***** ***** ***** ***** *****
Total ***** ***** ***** ***** *****
Gross profit ***** ***** ***** ***** *****
Less :
Rent ***** ***** ***** ***** *****
Telephone/Postal &internet charge ***** ***** ***** ***** *****
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 0.00 0.00 0.00 0.00 0.00
Subsidy 0.00 0.00 0.00 0.00 0.00 0.00
Termloan ***** 0.00 0.00 0.00 0.00 0.00
Profit before tax with interest 0.00 ***** ***** ***** ***** *****
Increase in WC loan 0.00 0.00 0.00 0.00 0.00 0.00
Depreciation 0.00 ***** ***** ***** ***** *****
Increase in Current liability 0.00 0.00 0.00 0.00 0.00 0.00
Total Cash Inflow ***** ***** ***** ***** ***** *****
Cash Outflow
Fixed Assets ***** ***** ***** ***** ***** *****
Increase in Current asset 0.00 0.00 0.00 0.00 0.00
Interest on TL 0.00 ***** ***** ***** ***** *****
Interest on WC 0.00 0.00 0.00 0.00 0.00 0.00
Income Tax 0.00 ***** ***** ***** ***** *****
Decrease in Term loan ***** ***** ***** ***** *****
Drawing 0.00 0.00 0.00 0.00 0.00 0.00
Total Cash Outflow ***** ***** ***** ***** ***** *****
Opening balance ***** ***** ***** ***** ***** *****
Net Cashflow 0.00 ***** ***** ***** ***** *****
Closing balance 0.00 ***** ***** ***** ***** *****

Balance sheet

Liability Pre operative period Year 1 Year 2 Year 3 Year 4 Year 5
A. Share holders funds
Capital ***** ***** ***** ***** ***** *****
Reserve & Surplus 0.00 ***** ***** ***** ***** *****
B.Non current Liabilities
Termloan ***** ***** ***** ***** ***** *****
C.Current Liabilities
Working capital loan 0.00 0.00 0.00 0.00 0.00 0.00
Account payable 0.00 0.00 0.00 0.00 0.00
Total Liability ***** ***** ***** ***** ***** *****
Asset
A. Non current Assets
Fixed Assets ***** ***** ***** ***** ***** *****
B. Current Assets
Inventory 0.00 0.00 0.00 0.00 0.00 0.00
Trade receivables 0.00 0.00 0.00 0.00 0.00 0.00
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 0.00 0.00 0.00 0.00 0.00
b).Depreciation 0.00 0.00 0.00 0.00 0.30
c).Interest on termloan 0.00 0.00 0.00 0.00 0.00
Total 0.00 0.00 0.00 0.00 0.00
Repayments
a).Loan Principal 0.00 0.00 0.00 0.00 0.00
b).Interest on termloan 0.00 0.00 0.00 0.00 0.00
Total 0.00 0.00 0.00 0.00 0.00
DSCR 0.00 0.00 0.00 0.00 0.00

Depreciation

Particulars Rate Year 1 Year 2 Year 3 Year 4 Year 5
Building 0.00 0.00 0.00 0.00 0.00 0.00
Less Depreciation 0.00 0.00 0.00 0.00 0.00
Written down value 0.00 0.00 0.00 0.00 0.00
Computers/ Printers /Photocopier/Electronic gadget 00 0.00 0.00 0.00 0.00 0.00
Less Depreciation 0.00 0.00 0.00 0.00 0.00
Written down value 0.00 0.00 0.00 0.00 0.00
Furniture & fixtures 00 0.00 0.00 0.00 0.00 0.00
Less Depreciation 0.00 0.00 0.00 0.00 0.00
Written down value 0.00 0.00 0.00 0.00 0.00
Racks & storage/Interior works 00 0.00 0.00 0.00 0.00 0.00
Less Depreciation 0.00 0.00 0.00 0.00 0.00
Written down value 0.00 0.00 0.00 0.00 0.00
new item 00 0.00 0.00 0.00 0.00 0.00
Less Depreciation 0.00 0.00 0.00 0.00 0.00
Written down value 0.00 0.00 0.00 0.00 0.00
new 00 0.00 0.00 0.00 0.00 0.00
Less Depreciation 0.00 0.00 0.00 0.00 0.00
Written down value 0.00 0.00 0.00 0.00 0.00
Air-conditioning 00 0.00 0.00 0.00 0.00 0.00
Less Depreciation 0.00 0.00 0.00 0.00 0.00
Written down value 0.00 0.00 0.00 0.00 0.00
Other investments 00 0.00 0.00 0.00 0.00 0.00
Less Depreciation 0.00 0.00 0.00 0.00 0.00
Written down value 0.00 0.00 0.00 0.00 0.00
Total less depreciation 0.00 0.00 0.00 0.00 0.00
Total written down value 0.00 0.00 0.00 0.00 0.00

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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