EXECUTIVE SUMMARY

Plastic is a basic need of our day to day life. During recent years the plastic industry has
grown with a substantial growth rate. This growth is driven by three sectors viz
packaging, infrastructure and agriculture. There are the various verities of plastics out of
which PVC (Polyvinyl chloride) and PET (Polyethylene terephthylene) plastics have their
considerable contribution. PET plastics are generally used in the manufacturing of
beverage bottles for the packaging and PVC plastic is used in the production of
household plastic materials. The growing utilization of plastics in industrial and
consumer applications and surrounding solid waste recycling, has led to an increased
demand for recycled plastic resins and products.
We at Quality Plastics provide a wide range of plastic solutions for household and raw
material for packaging of various companies. As a part of our ongoing efforts to exploit
this opportunity we will recycle the plastics and then produce kitchen ware items and
other related plastic material. We will also sell the recycled plastics to the companies in
the plastic business. We will have a recycling plant along with the production unit. The
raw material will be procured from the waste collectors. The raw material will be post
consumed beverage bottles and other soft plastic materials.
Our main focus is our industrial customer whom we will sell PET bottles and PET flakes.
It will contribute more than 60% of our sales. We will also focus on the household plastic
business which is the part of our portfolio. The initial set up cost will be Rs 34, 40,000.
Quality Plastics will be a solution proprietorship business run by the promoter Jugal Shah
who is a budding Entrepreneur and studying MCOM in his final year.
Since plastic material does not carry any brand name so it will give us an addition benefit
in long term to establish our brand name. To exploit the market we will use penetration
pricing as our marketing strategy and utilize our stringent distribution network and strong
industrial relationship. A long term loan will be taken from HDFC Bank who will Micro-
finance our business venture.
As a future plan in coming years we will increase the variety of plastics like LDPE (Low
density polyethylene) and HDPE (High density polyethylene). By doing this we will be
able to produce plastic carry bags and raw material for production for plastic chairs and
tables and other fiber based products.




2

COMPANY OVERVIEW
Quality Plastics provide a wide range of plastic solutions for households and raw material
for packaging to the various companies. Allahabad is the place where the facility will be
established and other operation will commence.
We will collect plastic garbage like consumer beverage bottles, plastic bags from various
garbage stores and then our recycle unit will process it which eventually be used for the
production of finished goods.
The plastic garbage we are getting as raw material has two components one is PVC
(Polyvinyl chloride) and other is PET (Polyethylene terephthylene ). Firstly the whole
garbage is melted and then PVC and PET are separated from each other by froth flotation
technique.
We will create a plant (actual facilities to be shared with the recycling unit) to
manufacture extruded plastic flakes (purified plastic). The extruded plastic is then molded
into various products.
We will produce two types of replay plastics
PVC( Polyvinyl chloride)
PET( Polyethylene terephthylene )

MISSION STATEMENT
Quality Plastics :
Strive to provide the excellent plastic solution to the customers at competitive
prices.
Continually expands our range of products.
Is poised to service both large and small customers.




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MARKETS AND PRODUCTS
The plastic products usually do not carry a brand name so intruding in the business like
plastic will not be too hard with low price strategy. The population of Mumbai and the
cities around it like Pune,Surat,Ahmedabad and Gujarat is considerable and this area
basically comprises of low to middle income group families so they focus on plastic
products rather than fiber since it is a cheaper. Hence it is huge market to exploit.
From Surat city 500 tons of solid waste is produced from that 15tons of plastic bags and
around 7 tons of plastic bottles is generated per day. So the supply of raw material will be
continuous.
Apart from this we will sell raw material for packaging to the various small companies in
this area. Around 30 small and medium scale companies are working in this region. So a
large amount of industrial customer is also available.
There are two folds of products that we are providing one is industrial and other is
household.
OBJECTIVES
Develop a business that survives on its own cash.
Create a company which exceeds customer satisfaction level.
Expand the service to Western India in first five years and then target rest of the
country.
Extending the services to electronic component manufacturing companies for
production of capacitors printed circuit boards etc.
KEY TO SUCCESS
The main keys to the success of the Company are:
Secure Supply- Contract for supply of post-consumer bottles and post-industrial
manufacturing waste for PET raw material feed stock.
Satisfy our customer so that we can retain them.
Maintain low overhead and operating costs.
Provide better prices than all our competitors.

4

PRODUCT AND SERVICES


We will provide a wide range of plastic products for households and raw material for
packaging.

The recycled plastic is processed to Polyethylene Terephthalate (PET). PET is a
thermoplastic polymer viscous of polyester family. The biggest property of this
compound is it is transparent. This is the reason why it is used for packaging. Apart from
this PET have good strength, ductility, stiffness and hardness. After the recycling process
completed an extruded plastic is generated. Plastics extrusion is a high volume
manufacturing process in which raw plastic material is melted and formed into a
continuous profile.

The products we are producing are :
Cleaned and recycled plastic flakes of PET and bottles, recovered from post-
consumer beverage bottles. (this PET will work as raw material for packaging to
various firms, not for the end user)
Household finished plastic goods. We are manufacturing plastic tubes of various
diameter, plastic kitchen ware. ( for the end user)
PET flake will be sold to thermo formers (those who mold plastic sheets into usable
products) primarily to be used to produce high-visibility packaging. And also to the
beverage companies for packaging.

Recycled plastic is widely used in mainstream construction products such as damp proof
membrane, drainage pipes, ducting and flooring. Bins, street signs and planters are
frequently made from plastic. They are cost competitive and resistant to damage. Local
authorities and schools are able to demonstrate recycling in action by specifying recycled
products
High strength PET is used in the clothing, furnishings, tyre cord and technical textiles.
Apart from PET the household plastic will be directly sold to the end customers. In day to
day life plastic items like water bottles, shop case scrubber etc is frequently used. So
there is a big demand of these in local market.


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MARKET COMPARISON
While quality and delivery are important factors to our potential clients, price is most
often the determining factor in a buying decision. Good-quality packaging products
manufactured from recycled (less expensive) resins, as close as practical to the end
customer's operations, will be most competitive and achieve a significant market
share. These factors have helped to determine the business parameters of Quality Plastics.

POSSIBLE OBSTACLES
The possible obstacles to the product are :
Unavailable or scarce raw material stock for production
Quality Plastics is confident that it has secured good availability of low cost post-
consumer PET bottles (feed stock) derived from post-consumer beverage bottles. It may
be possible that we would not get desired raw material.
Company may not meet environmental standards
This environmentally-favorable venture provides for the development of technically
feasible and economically viable solutions to PET plastic beverage bottle recycling, as
well as environmentally aware in-house re-use practices which filter and return nearly all
of the process water to the production lines









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INDUSTRY AND MARKETPLACE ANALYSIS
INDUSTRY ANALYSIS
Plastic recycling is an industry in itself in India. According to the Crisil research 7360
companies are working in this industry with a turnover of Rs 9200 Crore provides
employment to 3.5 million people. In India per capita plastic consumption in lowest in
the world. The per capita consumption is just one fifth of world average which is 5kg. the
domestic demand of plastic has grown by 9% and reached to 4.5MMT in year 2010.The
GDP has grown during this period at 6.3% and plastic industry 1.3 times of GDP.
According to the Crisil report the demand of plastic by 2015 will be around 12MMT. The
plastic consumption in India is booming. Demand for commodity plastics is growing at
the rate of 15% per year.India holds immense potential for the use of plastic in the
infrastructure and agriculture. In case of packaging industry we are using more plastic
than the developed countries. The growth is driven in three major sectors infrastructure
which is 13%% of the total, packaging is 15% of the total and 10% for plastic consumer
durables. It is projected that the plastic waste generation will reach the will reach the
level of 1.6 million tons annually.
India produces 5600 tons of plastic waste per day.
Region wise and polymer wise turnover of recycling industry in Rs.Crore
Region PVC PET
West 156 383
East 75 86
North 338 158
South 111 139
Total 680 766
Each region is specialized in one type of plastic viz south: PET; north: PVC;
The current plastic recycling rate is estimated as 60% by Plastic India Foundation. One
estimate is that about 20,000 microenterprises are engaged in reprocessing and recovery
of plastic waste in addition to 180,000 of various sorting and washing units, 60% of
which are unregistered. Delhi alone has estimated 53,400 units and Delhi and Bombay
together process over 50% of India's waste plastics.






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STRUCTURE OF THE PLASTICS INDUSTRY

The following pattern is likely to be general but there will be some variation from
country to country.


RAW MATERIAL PRODUCERS

These are chemical and petroleum companies who produce "virgin" plastic (sometimes
called resin or polymer) in huge quantities. The main influence they have on the recycler
is to fix prices and availability of virgin materials. Virgin material is delivered in powder
or pellet form, in plastic or paper sacks of around 20 kilos weight, in large cardboard
drums that hold many times that quantity or even by road tanker.

COMPOUNDERS

These specialist companies, usually small, stock various polymers and provide the
manufacturers of plastic goods with technical advice and the most suitable materials or
mixtures for each individual need. The compounder is often the best market for the
recycler because he possesses superior technical knowledge and has a large volume
throughput of virgin material, in which small percentages of reclaim will reduce cost
without seriously affecting the quality required by the molder.

STOCKISTS

These warehouses stock polymers and compounds but neither manufacture themselves,
nor provide a compounding service. They may be agents or subsidiaries of the producer
companies or departments of companies concerned with the supply of other materials
such as chemical, rubber or paper. They may be willing to stock reclaim alongside virgin
materials, especially if these are in short supply.

SPECIALIST MANUFACTURERS OR MOLDERS

These buy their raw materials from compounders. If they do their own compounding, or
if the material is used as produced and does not need compounding, they may buy direct
from stockists or producers. They are specialists in plastics and do not perform other
types of manufacturing. They may be an attractive market to the recycler because they
operate at high volume, but rarely have as much flexibility to vary product quality as
molders who know, accurately, the final market for the product.






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OTHER MANUFACTURERS

Many companies are not plastics specialists but employ molding operations in the
manufacture of some other product. For example shoe and boot makers use plastics
extensively and may carry out the various plastics molding operations in the same
production sequence as the work in leather, canvas, rubber etc. Many manufacturers use
plastic packaging machinery at the end of a production operation.

FABRICATORS

These firms cut and join sheet, rod or extrusion to manufacture a variety of products.
They have no opportunity to use reclaim. Machinery and Tool Makers One other sector
of the plastics industry justifies mention although not customers for reclaim. The makers
and suppliers of plastics manufacturing machinery, tools, moulds and dies are well
informed about who does what, who makes what and who uses what within the local
plastics industry. They may advise who is likely to buy material.
MARKETPLACE ANALYSIS
Various overseas players wish to explore the Indian market and invest in
opportunities thrown open by the country, projected to be world number 3 in plastics
consumption by 2018.As shown above the north region of India is specialized in
recycling of PVC. So there is a great scope of PET recycling. Apart from this the
other
A huge market with full of opportunity.
Absence of standard product and service
Well connected with other rural areas
Having good transportation facility







9

CUSTOMER ANALYSIS
Since we are a new player in the market, we need to make some stringent strategies to
penetrate market and grab customers. The customers of the plastic industry are scattered
due to lack well known brand names. So our first priority will be to accumulate the
defused customers.
The direct customers are the customers whom we are selling our product regularly. So for
us households whom we are selling plastic goods and companies who are getting raw
materials for packaging are direct customers (PET bottles). So only in Mumbai around
40,000 families are our direct prospective customers and in terms of business to business
market around 30 small and medium scale companies are our direct customers.
Apart from them there are few small companies which are giving compounding services.
They use to collect various types of plastics flakes along with the virgin plastic and
suggest customer (companies) in choosing appropriate plastic. Asha enterprise is one
compounder whom we will sell our plastics.

COMPETITOR ANALYSIS
In plastic manufacturing market there is no specific brand name is existing so the market
is flooded by small companies which are in this business. So they are our biggest direct
competitors.
As we are also not alone as a supplier of PET to the companies as raw materials there are
many companies in this region which are supplying PET. Allied Plastics is one of them
who is currently selling all types of plastics items. So in case of business to business
market they are our direct competitors. The direct threat we will also have is with the
companies operating in Surat. But as the distance between Surat and Mumbai is around
300 km, so it will not affect much.






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MARKETING STRATEGY
The Company has chosen to focus on the production of plastic packaging materials from
recycled post-consumer beverage bottles. We have identified a significant available
market in the south-eastern part of Mumbai. All of our initial marketing strategy will be
to secure contracts in that segment, and after reaching full planned capacity, look to grow
in concert with that segment and related markets. We see little need at present for further
market research and development, and will focus on continually updating our production
technology in an effort to remain in the forefront of our chosen marketplace.
PRODUCT/ SERVICE STRATEGY
The packaging companies require high quality and highly transparent PET bottles. The
companies which are producing mineral water will reject PET bottles with even a small
impurity/ opaqueness. So we the Quality Plastics provide high end PET flakes for the
perfect packaging.
Quality Plastics will apply recycling and extrusion technology managed by decades of
industry specific expertise to create a competitive advantage for its clients. These
processes will produce clean, cost-efficient, recycled raw material for manufacturers of
thermoform, laminate and other high value-added products, and high strength packaging
strapping for shippers of large products and pallets, thereby reducing costs and creating a
clear pricing edge among their competitors.
Plastic bags and plastic sheets are now in high demand. And this demand is driven by
continuously increasing promotional activities.
PRICING STRATEGY
As plastic products do not carry any brand name so only pricing and distribution
strategies will works to achieve competitive edge. The pricing strategy we will use is
penetration pricing. The price of all household plastic goods we will sell will be lower
than the market price. Also for the PET flakes and bottles the price will be lower than the
competitors. A lower price enables us to get contracts of PET bottles and sheets from
various companies.
In case of kitchenware and other household products we will provide combo offers and
discounts which a common customer expects.



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DISTRIBUTION STRATEGY
As I described before that firstly we will target Mumbai city and villages close to it. We
will have a distribution center in the Mumbai city which continuously maintains the
supply of goods. So the household plastics will be sold through small local grocery shops
from which the customers can get them easily. Apart from this we will hire street
hawkers who will roam around the city and sell the goods door to door.
PET bottles will be stored in warehouse which is close to the facility itself. The sales
people will directly contact to the companies which require these bottles for packaging
and look for the contracts. In city as stated above that we will have a distribution center,
from that center we will distribute to whole sellers.
ADVERTISING & PROMOTION STRATEGY
As I described we are in both B2C(Business to Consumer) and B2B(Business to
Business) so for this we will use two different promotional strategies. For B2C business
we will use flyers which will have full detail of our product range, price, combo offers
and discounts. These flyers will circulate through the newspapers across whole city. For
B2B business we will promote through online social media and we will also develop our
website through which enable us to widely spread our contact among various companies.
the site will have full details of product which are available for companies as well as end
user.











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SALES STRATEGY
The strategy of sales effort will be to convert potential and first time customers into long
term customers. Our sales strategy is totally based upon the distribution channel and the
pricing strategies. We will have a distribution centre in the city that will take care of sales
of household and also supply products to the wholesalers. We will also give the industrial
customers a facility to order the products through our website which will help them in
reducing the delivery time.
To market the products, the Company will use a number of sales agents/brokers. They
have a customer base of their own, having developed successful relationships with their
client over the years. Their customer base is currently demanding product so they can
expand upon their current base. Of course, they will expand that to new customers when
product is available.
If the Company grows faster than its prime customer base, additional capacity may be
developed. We will identify additional prospective customers who can be attracted for
our products.
MARKETING & SALES FORECAST
The first month prior to the opening will be used to get the new office in order, set up
appointment and begin marketing activities. In the first month we will focus on the
generating public visibility. The sales forecast is based on the assumption that we will
sell all of the highest volume PET bottles that we can produce. This flake will be sold to
other manufacturing companies. Recycling industry is growing with 15-20% each year.
So we can assume that we will grow with at least 20%. There is a continuing strong
demand for flake and extruded products made from recycled PET.


Sales forecast


year 1 year 2 year 3 year 4
Annual sales 1620000 2106000 2737800 3559140

Monthly sales 135000 175500 228150 296595

PET Sales 94500 122850 159705 207617

Household items 40500 52650 68445 88978.5

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DEVELOPMENT
The development of Quality plastics required to accomplish a series of action and
formalities. Since we are new in the market we kept our production is low initially, as
demand will increase the production will be enhanced respectively. Now we are recycling
and producing only two types of plastics i.e. PVC and PET, as we grow we will produce
a wide the range of plastics and its finished product. . The development process involves
following steps:
Legal formalities
Office/business setup
Future offerings and expansion plan
DEVELOPMENT STRATEGY
In future we are looking for the production of a variety of plastic. These plastics will be
LDPE ( Low density polyethylene)
HDPE ( High density polyethylene)
LDPE plastic is used in the production carry bags and other plastic sheets as well as cling
wrap, car covers, squeeze bottles, liners for tanks and ponds, moisture barriers in
construction. And HDPE plastics are used in production of freezer bags, water pipes, wire
and cable insulation, extrusion coating.Our development strategy will base on timely
completion of the establishment of the business centre with low execution cost. Our
strategy will focus not only the current uninterrupted production of PVC and PET and
acquisition of customer as fast as we can, but we will also look for the future expansion
plan and execution strategy.
The development strategy will address following issue:
How will we expand our services?
Which are the new areas we will include to provide our services?
What will be the format of the business
Our development strategy will address all those above mentioned point. As we will grow
and our earning will increase, we will produce more of PVC and PET as well as expand
in new area. We have a development strategy to expand our facility size in order to meet
the production size.

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MANAGEMENT

The company will be managed by the promoter and six supporting staff.
Jugal Shah, a Management student, is the owner and promoter of Quality Plastics. He has
basic knowledge and understanding in financial areas like Risk and Return management,
Investment portfolio and Capital Budgeting, which undoubtedly will be of intense help in
the business. Apart from this he also has a good knowledge of chemicals and their
properties.
Marketing skills like convincing power, negotiating ability, creating promotional
strategies and sales skills will all be extremely helpful in taking the business a long way
and will prove intensely valuable to take Quasar Plastics to flaring heights.
Thus with such potential skills, and other qualities like efficient interpersonal skills,
leadership skills and decision making quality, aptly makes him the best promoter and
eligible founder and owner of Quality Plastics
Along with promoter five more employees will work for the accomplishment of
companies objective. One supervisor will work on the facility along with two supporting
staff. Supervisor who will work upon the facility does not need to be a chemical engineer
a simple technician has experience on working upon the facility can be able to do this.
JOB DESCRIPTION
Process No of employees Proficiency
Sorting 2 unskilled
Belt Conveyer 1 semiskilled
PET Separator 1 semiskilled
Packaging 4 unskilled




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OPERATIONS
The operations is defined as the process used to deliver your products and service to the
customer market place and also include manufacturing transportation logistics travel and
after sales services.
The facility is located at outside the city. Facility is divided in two parts
Recycling and Production unit
Warehouse
The facility is located in an area of 3000 sqft..Apart from these two units there will be an
office which will look for the perpetual supply of required raw material and also take
care about the outbound logistics. The production capacity is 80kg/hr.
The operations will be based upon JIT i.e. just in time. We will have contracted with the
suppliers who can supply the raw material as quickly as we want. The raw material
contains post consumer beverage bottles and other plastic materials. The bottles and other
plastic material that can be recycled have a specific sign from which it can be identified
that it can be recycled or not.
The plastic is then transferred to respective unit to be recycled because PET and PVC
cannot be recycled simultaneously due to their different properties. There will be two
units running parallel to each other. On unit will recycle and produce PVC plastic and
other will perform the same for the PET plastic.
The recycled PVC is then moved for the plastic injection molding unit in the various
shapes. Since there are a variety of product is being produced so the preference will be
given to that product whose demand is high. All the products will not be produced each
and every day. There will be different products which will be produced on different day
according to the demand in market.
After the recycling process is completed one part of PET flake is moved to the
warehouse according to the demand of raw material which different companies need and
other part will move for the molding in bottles.
The recycled PET flake is then heated and made the viscous solution of it. The PET resin
is then feeded to the molder and molder will give it various shape bottles. And then it left
for drying. Those products which further need for processing like buckets, the handle will
be inserted after the bucket is dried.


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STAGES OF RECYCLING AND PRODUCTION
The process of recycling of waste plastics into products of varying usefulness involves
the following essential steps:
Sizing / Chipping
Cleaning
Segregation.
Agglomerating / Colouring
Extrusion / Palletisation
Fabrication into end Product.
CHIPPING:
The plastics waste is then required to be properly sized so that those may be fed into
the extruders for processing and palletizing. The sizing operation depends on the type
and shape of the waste plastics.
During this process, attention is required to separate any powdery material from the
sized / chipped plastics.
SEGREGATION:
Certain polymeric materials are compatible with each other at all proportions. For
example LDPE and Lldpe are generally compatible to each other at all proportions.
The advanced technology of separating / segregating different types of waste plastics
involves Floatation Process. In this process the property of the varying densities of
different plastics is made use of for segregating different types of plastics.
However in the Indian Context, this separation or segregation process, in many cases,
are done by manual process utilizing the availability of cheap and expert labor force.
In case the waste is contaminated with embedded metals, proper method of separating
the metals / other contaminants is required.
CLEANING:
The scale of cleaning depends on the type of waste. Whenever a cleaning operation is
involved, it is to be ensured that the water or any other cleaning material used, should
be discharged after ascertaining that the discharge does not contain any objectionable
substance. A proper Treatment Device may have to be deployed like a water
treatment plant / effluent treatment plant. For drying, a suitably designed drier is used.

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Many industries situated outside the metropolises, use open space for natural drying
of the cleaned waste.
AGGLOMERATING / COLOURING:
In the next operation the sized plastics waste is mixed with colour master batch in
high-speed mixers / agglomerators and the output is ready for extrusion into pellets.
EXTRUSION / PALLETISATION:
This is the most important part of the process wherein the sized / chipped plastics are
plasticized and granulated to make the plastics material ready for fabrication next.
The type and size of the Extruder depend on the type and volume of the plastics
waste.
FABRICATION INTO END PRODUCT:
Finally the reprocessed plastics granules are used as raw material for producing end
products using similar fabrication machines like Injection Molding / Extrusion etc.,
depending upon specific requirement.

SCOPE OF OPERATIONS
Now presently our production capacity is 200kg/day from which in initial stages we are
utilizing around 50% of it. As the business expands we will reach to optimum capacity
utilization. We are expecting that we will start producing more advance plastics in the
fourth year of our operations and accordingly the sales will increase and the facility will
have to be expanded.






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SUPPLY CHAIN
In the city there are various small post consumer plastic bottle collectors. To make a
continuous supply of raw material we will have four suppliers with us. There will be one
permanent supplier which will continuously supply the raw material. In case of excess
demand other suppliers will be taken into consideration. The transportation cost will be
covered by supplier only. The finished product will be stored in the warehouse and
according to the demand it will be send to city distribution centre. The distribution center
will directly sell the finished household plastics as well as to the small shops.
Our average daily demand of raw material is 300kg and the lead time we will keep lead
time of 6hrs. We keep a safety stock of 50 kg. So the reorder point is given by
Reorder point= average daily uses x lead time + safety stock
Reorder point = 300 X .25day + 50
= 125 kg.
So at each and every day we will have minimum of 125kg (safety stock+ reorder point)
of raw material in our inventory.


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This means that when the raw material level reaches to 125kg we will place the next
order. The difference time in which we will place the order and receive the order is the
lead time which is 6hrs.


PROCESS FLOW CHART

20

GANTT CHART



As it is an assembly line the output of one stage is feeded to the input of next stage. The
whole process will run in series format. That is the reason why no parallel process is
mentioned in the gantt chart.









21

FACILITY LAYOUT



22

FINANCIALS
MICRO FINANCE

Microfinance is a form of financial services for entrepreneurs and small businesses
lacking access to banking and related services. The two main mechanisms for the
delivery of financial services to such clients are: (1) relationship-based banking for
individual entrepreneurs and small businesses; and (2) group-based models, where
several entrepreneurs come together to apply for loans and other services as a group.
For some, microfinance is a movement whose object is "a world in which as many poor
and near-poor households as possible have permanent access to an appropriate range of
high quality financial services, including not just credit but also savings, insurance, and
fund transfers." Many of those who promote microfinance generally believe that such
access will help poor people out of poverty. For others, microfinance is a way to promote
economic development, employment and growth through the support of micro-
entrepreneurs and small businesses.
Microfinance is a broad category of services, which includes microcredit. Microcredit is
provision of credit services to poor clients. Microcredit is one of the aspects of
microfinance and the two are often confused. Critics may attack microcredit while
referring to it indiscriminately as either 'microcredit' or 'microfinance'. Due to the broad
range of microfinance services, it is difficult to assess impact, and very few studies have
tried to assess its full impact. Proponents often claim that microfinance lifts people out of
poverty, but the evidence is mixed. What it does do, however, is to enhance financial
inclusion.
MICROFINANCE IN INDIA
Loans to poor people by banks have many limitations including lack of security and high
operating cost and so Microfinance was developed as an alternative to provide loans to
poor people with the goal of creating financial inclusion and equality.
Muhammad Yunus a Nobel Prize winner, introduced the concept of Microfinance in
Bangladesh in the form of the "Grameen Bank". NABARD took this idea and started
concept of Micro Finance in India.In this concept, there exists a link between SHGs(Self-
help group), NGOs and Banks. The SHGs are formed and nurtured by NGOs and only
after accomplishing a certain level of maturity in terms of their internal thrift and credit
operations.They are entitled to seek credit from the banks. There is an involvement of the
concerned NGO before and even after the SHG-Bank linkage.The SHG-Bank linkage
programme, which was undertaken since 1992 in India, had financed about 22.4 lakh

23

SHGs by 2006. It involved commercial banks, Regional Rural Banks (RRBs) and
cooperative banks in its operations.

Micro Finance is defined as, financial services such as Saving A/c, Insurance Fund &
credit provided to poor & low income clients so as to help them to rise their income &
there by improve their standard of living.
From this definition it is clear that main features of Micro Financing:
1) Loan are given without security
2) Loans to those people who live BPL (Below Poverty Line)
3) Even members of SHG enjoy Micro Finance
4) Maximum limit of loan under micro finance Rs 25,000/-
5) The terms and conditions given to poor people are decided by NGOs
6) Micro Finance is different from Micro Credit- under Micro Credit, small amount of
loans given to the borrower but under Micro Finance besides loans many other financial
services are provided such as Savings A/c, Insurance etc. Therefore Micro Finance has
wider concept as compared to Micro Credit.
IMPACT
Proponents state that it reduces poverty through higher employment and higher incomes.
This is expected to lead to improved nutrition and improved education of the
borrowers'children.
The available evidence indicates that in many cases microcredit has facilitated the
creation and the growth of businesses. It has often generated self-employment, but it has
not necessarily increased incomes after interest payments. In some cases it has driven
borrowers into debt traps. There is no evidence that microcredit has empowered women.
In short, microcredit has achieved much less than what its proponents said it would
achieve, but its negative impacts have not been as drastic as some critics have argued.
Microcredit is just one factor influencing the success of small businesses, whose success
is influenced to a much larger extent by how much an economy or a particular market
grows.


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MICROFINANCE FOR QUALITY PLASTICS

For our business, Micro Finance will be obtained from HDFC Bank. Repayment along
with Interest will be done on a monthly basis till the Loan is repaid back. Ahead in the
project , a detailed report on Repayment of loan is made.

The startup cost of the business is as follows:

START-UP

Requirements Amount
Start-up Expenses
Legal 6,000
Stationery 500
Business Cards 500
Initial Mailing 100
Process Funding 400
Office Equipment 2,500
Total Start-up Expenses 10,000

Start-up Assets
Cash Required 1,00,000
Other Current Assets 0
Long-term Assets 33,30,000
Total Assets 34,30,000

Total Requirements 34,40,000



25

INCOME STATEMENT
The projected income is as shown below it shows that first year we will end
up with loss but from second year we will start making profits.
Particulars YEAR 1 YEAR 2 YEAR 3 Year 4
Net sales 1620000 2106000 2737800 3285360
Cost of good sales 891000 1158300 1505790 1806948
Gross margin 729000 947700 1232010 1478412
Operating expenses:
Admin exp. 3000 3150 3308 3473
Advertisement 6000 7200 8640 10368
Salaries 192000 211200 232320 255552
Transportation 96000 105600 116160 127776
Maintenance 15000 15750 16538 17364
Electricity 4800 5040 5292 5557
Telephone 10000 11000 12100 13310
Legal exp. 10000 1000 1000 1000
Insurance 20000 20000 20000 20000
Rent 24000 26400 29040 31944
Other exp 6000 6600 7260 7986
386800 412940 451657 494330
EBITDA 342200 534760 780353 984082
Less depreciation 303000 272700 245430 220887
EBIT 39200 262060 534923 763195
Less interest paid 175550 165061 153243 139926
EBT -136350 96999 381680 623269
Tax @ 30% 0 29100 114504 186981
PAT -136350 67899 267176 436288


26

BALANCE SHEET
The projected balance sheet of four years is as follows:
Sources of Funds Year-1 Year-2 Year-3 Year-4
Capital
Owner's capital 1930000 1930000 1930000 1930000
Surplus -136350 -68451 130274 765287

Net worth 1793650 1861549 2060274 2695287
Long Term loan
Loan 1417302 1324116 1219111 1100789
Current Liabilities
Creditors 70500 56722 68066 81680

Total liabilities 3281452 3242387 3347451 3877756
Application of fund
Plant & M/C 3030000 2727000 2454300 2208870
Less depreciation 303000 272700 245430 220887
2727000 2454300 2208870 1987983
Land 300000 300000 300000 300000
Actual Fixed Asset 3027000 2754300 2508870 2287983
Current Assets:
Inventory 97200 315900 410670 821340
Bank 10000 40000 100000 100000
Debtors 147252 132187 117911 232703
Advance to suppliers 0 0 210000 335730
Investment 100000
Total Assets 3281452 3242387 3347451 3877756


27

BREAK EVEN POINT
VC Amount in Rs FC Amount in Rs


Admin 3000
other exp 6000 Interest 175550
transportation 96000 advertisement 6000
telephone 10000 Insurance 20000
wages 119250 Salary 192000
carriage inward 238500 Rent 24000
power 119250 maintenance 15000
raw material 414000 depreciation 303000


Legal 10000
total 1003000 Total 748550
contribution 617000





pv ratio 0.3808642





BEP units 1965398.703

135000
BEP SALES 15 in months



1.21 In years

As the BEP is 15months it means that at 15
th
month we will be in a trade off
total expenses and revenue.


28

APPENDIX
ANNUITY TABLE:
total loan amt.= pmt[1-1/(1-i)^n]/i
n is number of years

i is interest rate


loan amount 1500000 ######

interest rate annually 0.12 ######

pmt =

21521
21520.64




month EMI Interest principle balance O/S Annual interest
1 21521 15000 6521 1493479
2 21521 14935 6586 1486894
3 21521 14869 6652 1480242
4 21521 14802 6718 1473524
5 21521 14735 6785 1466738
6 21521 14667 6853 1459885
7 21521 14599 6922 1452963
8 21521 14530 6991 1445972
9 21521 14460 7061 1438911
10 21521 14389 7132 1431780
11 21521 14318 7203 1424577
12 21521 14246 7275 1417302 175550
13 21521 14173 7348 1409954
14 21521 14100 7421 1402533
15 21521 14025 7495 1395038
16 21521 13950 7570 1387468
17 21521 13875 7646 1379822
18 21521 13798 7722 1372099
19 21521 13721 7800 1364300
20 21521 13643 7878 1356422
21 21521 13564 7956 1348466
22 21521 13485 8036 1340430
23 21521 13404 8116 1332313
24 21521 13323 8198 1324116 165061
25 21521 13241 8279 1315836
26 21521 13158 8362 1307474
27 21521 13075 8446 1299028

29

28 21521 12990 8530 1290498
29 21521 12905 8616 1281882
30 21521 12819 8702 1273180
31 21521 12732 8789 1264391
32 21521 12644 8877 1255515
33 21521 12555 8965 1246549
34 21521 12465 9055 1237494
35 21521 12375 9146 1228348
36 21521 12283 9237 1219111 153243
37 21521 12191 9330 1209782
38 21521 12098 9423 1200359
39 21521 12004 9517 1190842
40 21521 11908 9612 1181229
41 21521 11812 9708 1171521
42 21521 11715 9805 1161716
43 21521 11617 9903 1151812
44 21521 11518 10003 1141810
45 21521 11418 10103 1131707
46 21521 11317 10204 1121504
47 21521 11215 10306 1111198
48 21521 11112 10409 1100789 139926
49 21521 11008 10513 1090277
50 21521 10903 10618 1079659
51 21521 10797 10724 1068935
52 21521 10689 10831 1058103
53 21521 10581 10940 1047164
54 21521 10472 11049 1036115
55 21521 10361 11159 1024955
56 21521 10250 11271 1013684
57 21521 10137 11384 1002300
58 21521 10023 11498 990803
59 21521 9908 11613 979190
60 21521 9792 11729 967461 124920
61 21521 9675 11846 955615
62 21521 9556 11964 943651
63 21521 9437 12084 931567
64 21521 9316 12205 919362
65 21521 9194 12327 907035
66 21521 9070 12450 894584
67 21521 8946 12575 882010
68 21521 8820 12701 869309
69 21521 8693 12828 856481
70 21521 8565 12956 843526

30

71 21521 8435 13085 830440
72 21521 8304 13216 817224 108010
73 21521 8172 13348 803876
74 21521 8039 13482 790394
75 21521 7904 13617 776777
76 21521 7768 13753 763024
77 21521 7630 13890 749134
78 21521 7491 14029 735104
79 21521 7351 14170 720935
80 21521 7209 14311 706624
81 21521 7066 14454 692169
82 21521 6922 14599 677570
83 21521 6776 14745 662825
84 21521 6628 14892 647933 88957
85 21521 6479 15041 632892
86 21521 6329 15192 617700
87 21521 6177 15344 602356
88 21521 6024 15497 586859
89 21521 5869 15652 571207
90 21521 5712 15809 555398
91 21521 5554 15967 539432
92 21521 5394 16126 523305
93 21521 5233 16288 507018
94 21521 5070 16450 490567
95 21521 4906 16615 473952
96 21521 4740 16781 457171 67486
97 21521 4572 16949 440222
98 21521 4402 17118 423104
99 21521 4231 17290 405814
100 21521 4058 17462 388352
101 21521 3884 17637 370715
102 21521 3707 17813 352901
103 21521 3529 17992 334910
104 21521 3349 18172 316738
105 21521 3167 18353 298385
106 21521 2984 18537 279848
107 21521 2798 18722 261126
108 21521 2611 18909 242216 43293
109 21521 2422 19098 223118
110 21521 2231 19289 203829
111 21521 2038 19482 184346
112 21521 1843 19677 164669
113 21521 1647 19874 144795

31

114 21521 1448 20073 124722
115 21521 1247 20273 104449
116 21521 1044 20476 83973
117 21521 840 20681 63292
118 21521 633 20888 42404
119 21521 424 21097 21308
120 21521 213 21308 0 16031

















32

CONCLUSION
After preparing the project report on Entrepreneurship Management, we conclude that
the establishment of any organization is a crucial task . The promoter has to deal with
many circumstances which require high involvement in decision making and strategic
planning regarding proper innovations.

However it is essential that the top management personnel carry out their responsibilities
in a good manner.

The motto of our business is :-

QUALITY AT ITS BEST.

Potential for plastics is increasing, thus we have to maintain our reputation.
Plastic is the basic need of our day to day life. Since plastic material does not carry any
brand name, it will give us an addition benefit in long term to establish our brand name.







33

BIBLIOGRAPHY

CRISIL REPORT ON PLASTIC INDUSTRY
PLASTIC WASTE OPTION FOR SMALL SCALE RECOURSE
RECOVERY BY INGE LARDINOIS
SMALL SCALE RECYCLING OF PLASTIC BY- JON VOGLER




WEBLIOGRAPHY
www.google.com
www.wikipedia.org