FEASIBILTY REPORT

PURIFIED AND
MINERALIZED
BOTTELED WATER
Prepared by :- Hammad Mirza(58186)
Wisha Sohail(58224)
Harris Bin Shabbir Khan(58065)
Syed Qaim Ali Moosvi(57512)

TABLE OF CONTENTS

PERSONAL INFORMATION
We are a group of 4 business graduates and doing our bachelors in
business administration. We chose entrepreneurship as our career
opportunity and decided to inject our investment in a pool of mutually
acceptable business in order to start our professional career.
After a close market survey we chose to start business of purified and
mineralized bottle water due to the increasing demand and growth
potential in this business.

The business idea

Bottled water often called drinking water is usually bottled at
the source and sealed in safe drinking containers. Bottled water
is a food product that considerably depends on the
environment from which it originates not only at the place
where it is produced but predominately on the conditions in
the recharge area of the wells captured for bottling water is
initial for life, human beings can only survive for a few minutes
as 75 percent of body fluid is made up of water. Ordinarily,
water is subjected to varying degree of pollution, depending on
the source. Therefore water meant for human consumption
must be treated in order to remove all the unwanted
parameters.
Potential and opportunity to grow
The market for mineral water has been showing a mushroom
growth trends over the last few years. The countrys market is
very small on a global scale and was estimated at 33 million
liters a year by the end of 1998. The last three years have
shown more growth and the market has been estimated to
grow 70 million liters and the per capita consumption is 0.5
liters. The annual growth rate for bottled water is 45%.
According to the study conducted in 2004, Pakistan registered
the highest growth of 140% in 2003 amongst the countries in
Asia and middle east region.

The potential market for bottled consist of foreign tourist and

foreigners working in Pakistan, hotel industry, patients (bottled
water is also used to avoid the possible consumption of
contaminated water for patients) and travelers. Moreover the
bottled water has been emerging as a daily preference of the
elite class. Karachi being the biggest city of Pakistan has been
facing the problem of drinking water shortage. This further
integrates the demand for pure drinking water in Karachi.
Project Brief
This proposed project presents an investment opportunity for
establishing a bottled water plant for providing pure drinking
water. The proposed product line will consist of bottles of 19
liters. In the initial phase of the project only 19 liters and 1.5
liters bottle will be introduced in the local market. After
successful introduction of the new brand of bottled water the
product line may be extended to 0.5 and 1 liters bottle.
Process
Ground water will be used as a source of supply which will be
tested to know the quantity of minerals and deposits contained
in water, water will then be passed into the reverse osmosis
plant known as RO plant which will filter and purify that water
and then it is further passed to add essential minerals and then
it will be filled in 19 liters of bottles and sealed. Below is a
diagrammatic process chart.

Critical Factors
Before making any investment decision, it is advisable to
evaluate the associated risk factors by taking into consideration
certain key elements. For establishing water purification plant
critical factors that should be considered before launching are
described below.
Compliance of the water quality standards of Pakistan
Standards & Quality Control Authority (PSQCA) and license
from the authority.
The market for purified bottled / mineral water is a
growing market, but offers tough competition.
Perception / positioning of the new brand. Usually the top
target market for bottled mineral water follows the
perception. If the perception is positive, the results will be

higher sales. The positive perception for distributors and

final customers may result from direct consumer
experience, awareness, direct promotional activities, print
media and TV advertising. Distribution is very important
for the success of new brand. The stronger the distribution
the more successful will be the new brand. The
distribution strategy should be designed after a careful
study of the market for going for regional distribution or
for nation wide distribution.
Pre-launch advertising is vital for positive perception of
the product, which will result in higher product acceptance

Legal requirements
The assessment of the suitability of water for human
consumption shall be based on consideration of its physical,
chemical and microbiological requirements and limits for toxic
substances. The water should be free from all chemical and
bacteriological contaminations which are hazardous to health.
The general requirements for establishing a bottled / mineral
water plant as developed by Pakistan Standard Quality Control
Authority are as following:-

REQUIREMENTS

UNITS

Ph range
Total dissolve solids
Nitrate
Chloride
sulphate
Sodium
potassium

7.0-8
200mg/lit
0.020mg/lit
40mg/lit
10mg/lit
20mg/lit
10mg/lit

Market analysis
Proposed location
We will be choosing federal B area installing our plant as
Rental cost is low as compared to other areas, the quality
of ground water is much better compared to other areas.
Moreover its a residential areas which faces severe
shortage of water so demand for local consumption is
high. There are no plants nearby.
Market size and segment
Our market is divided into 3 segments which consist of
Households for domestic consumption, offices and other local
distributors.

Market trends
The market and demand for purified water is increasing day by
day with some variations. In summer demand is quite high and
it is often observed that the distributors face serious challenges
to meet the demand. Secondly during rainy seasons demand
increases and people who dont consume bottle water start
consuming it due to contaminated water supply during rains. A
decline is seen in winter seasons due to fall in consumption of
water in winters. Overall the demand is growing throughout the
year.

Competition
Below is a list of brands which are supplying there water in the
chosen area.
Niagra
Nestle Pure
AVA
Sparklets
Masafi
Aqua Safe
The price range for 19 liter category is from Rs.80-90 for
available brands.

Distribution channel
After processing the bottle water will be available on our water
display outlet and will be supplied in homes and offices
according to the delivery order.

Resource requirements
12345678-

Land (120 yards)

RO plant (2000 gallon)
500 Bottles
Transportation Loader
Packaging equipment
Plant operator and delivery staff
Sales representatives
Furniture and fixtures

Financial Viability
INVESTMENT
Land
RO PLANT(2000 gallons)
DELIVERY LOADER
FIXT & FURNITURE
TOAL INVESTMENT

IN Rs
120,000
200,000
300,000
100,000
720,000

Key Assumptions
Project Assumptions
Period of construction &
machinery installation
(months)
Total covered area
Projected life of project

20 days

120 yards
10 years

Operating Assumptions
No. of working days in one
1040 days
year
No. of working hours in week 20 hours

Revenue Assumptions
Increasing percentage of
production
Plant capacity liters per week
Production per year(liters)
Production of 19 liters
bottle/week
Total annual production
Sales price of 19 liter bottle

Annual sales turnover

30% per anum

30280
444600
450 bottles
23400 bottles
80 rs
1872000

Total Annual Cost

Increase in yearly cost
Rent 20,000 per month
(year)(fixed)
Transportation cost

30%
240,000 rs
72000 rs

(year)(variable)
Electricity cost
(year)(variable)
Labour (year)(variable)
Depreciation expense
Maintenance per year
Raw material consumed/year

120,000 rs
360,000 rs
10,000
10,000 rs
10,000

Projected Income Statement

Particulars

2014

Sales
Less COGS
Raw Material
Manufacturing
Expense
COGS
Gross Profit
Operating
Expenses
Labor Expense
Rental Expense
Transportation
Expense
Electricity Expense
Depreciation exp
Total Operating
Expenses
Net Profit

2015

2016

2017

2018

1872000 2433600

3163680

4112784

5346619

20000
243000

33800
410670

43940
533871

57122
694032

(263000) (341900)
1609000 2091700

(444470)
2719210

(577811)
3534973

(751154)
4595465

360000
240000
72000

482040
405600
121680

626652
527280
158184

814648
685464
205639

26000
315900

468000
312000
93600

120000 156000
202800
263640
342732
25000
25000
25000
25000
25000
(817000) (1279600) (1237120) (1600756) (2073483)
792000

812100

1482090

1934217

2521982

BALANCE SHEET 2014

FIXED ASSETS
LAND
PLANT
LESS:-DEP
DELIVERY VAN
LESS:-DEP
FIXTURES AND
FITTINGS
LESS:-DEP

EQUITIES
120,000
200,000
-10,000
300,000
10,000

190,000
290,000

100,000
5,000

CURRENT ASSETS
BANK
AC.RECIEVABLE
TOTAL ASSETS

95,000

800,000
17,000
151,200,0

OWNERS
EQUITY
CAPITAL AT BEGINNING
NET PROFIT
TOTAL EQUITIES

720,000
792,000
151,200,0

BALANCE SHEET 2015

FIXED ASSETS
LAND
PLANT
LESS:-DEP
DELIVERY VAN
LESS:-DEP
FIXTURES AND
FITTINGS
LESS:-DEP
CURRENT ASSETS
BANK
AC.RECIEVABLE
TOTAL ASSETS

EQUITIES
120,000
190,000
-10,000
290000
-10,000
95,000
5,000

180,000
280,000

90000

860,000
21,00
1532100

OWNERS
EQUITY
CAPITAL AT BEGINNING
NET PROFIT
TOTAL EQUITIES

720,000
812,100
153,210,0

BALANCE SHEET 2016

FIXED ASSETS
LAND
PLANT
LESS:-DEP
DELIVERY VAN
LESS:-DEP
FIXTURES AND
FITTINGS
LESS:-DEP

EQUITIES
120000
180,000
-10000
280,000
10,000

270,000

90,000
5,000

85000

CURRENT ASSETS
BANK
AC.RECIEVABLE
TOTAL ASSETS

170000

153,7090
20,000
220,209,0

OWNERS
EQUITY
CAPITAL AT BEGINNING
NET PROFIT
TOTAL EQUITIES

720,000
148,209,0
220,209,0

BALANCE SHEET 2017

FIXED ASSETS
LAND
PLANT
LESS:-DEP
DELIVERY VAN
LESS:-DEP
FIXTURES AND
FITTINGS
LESS:-DEP
CURRENT ASSETS
BANK
AC.RECIEVABLE
TOTAL ASSETS

EQUITIES
120000
170,000
-10000
270,000
10,000

260,000

85,000
5,000

80,000

160000

1999,217
35,000
265,421,7

OWNERS
EQUITY
CAPITAL AT BEGINNING
NET PROFIT
TOTAL EQUITIES

720,000
193,421,7
265,421,7

BALANCE SHEET 2018

FIXED ASSETS
LAND
PLANT
LESS:-DEP
DELIVERY VAN
LESS:-DEP
FIXTURES AND
FITTINGS
LESS:-DEP
CURRENT ASSETS
BANK
AC.RECIEVABLE
TOTAL ASSETS

EQUITIES
120000
160,000
-10000
260,000
10,000

250,000

80,000
5,000

75,000

150000

259,698,2
50,000
324,198,2

OWNERS
EQUITY
CAPITAL AT BEGINNING
NET PROFIT
TOTAL EQUITIES

720,000
252,198,2
324,198,2

(Aqua Pure)
Statement of Cash Flows
For the year ended December31,2014
$
Cash flow from operating activities
Receipts from customers

1855000

Payments to suppliers

(270,000)

-Payments to employees

(360,000)

Interest payments

-0

Interest received

Taxes paid

-0

Net cash flow from operating activities

1225000

Cash flow from investing activities

Purchases of equipment

(200000)

Deposits on rental premises

(120,000)

Proceeds from sale of equipment

Proceeds from sale of property

Net cash flow from investing activities

(320,000)

Cash flow from financing activities

Proceeds from borrowings

Payments of borrowings (repayment of principal)

-0

Investment into business

Drawings from business investment

-0

Net cash flow from financing activities

Net increase (decrease) in cash held

905000

Cash at beginning of period

100000

Cash at end of period

105000

(Aqua Pure)
Statement of Cash Flows
For the year ended December31,2015
$
Cash flow from operating activities
Receipts from customers

2431500

Payments to suppliers

(351000)

Payments to employees

(468000)

Interest payments

-0

Interest received

Taxes paid

-0

Net cash flow from operating activities

1612500

Cash flow from investing activities

Purchases of equipment

Deposits on rental premises

0aaa

Proceeds from sale of equipment

Proceeds from sale of property

Net cash flow from investing activities

Cash flow from financing activities

Proceeds from borrowings

Payments of borrowings (repayment of principal)

-0

Investment into business

Drawings from business investment

-0

Net cash flow from financing activities

Net increase (decrease) in cash held

1612500

Cash at beginning of period

200000

Cash at end of period

1812500

(Aqua Pure)
Statement of Cash Flows
For the year ended December31,2016
$
Cash flow from operating activities
Receipts from customers

3143680

Payments to suppliers

(456300)

Payments to employees

(482040)

Interest payments

-0

Interest received

Taxes paid

-0

Net cash flow from operating activities

1482090

Cash flow from investing activities

Purchases of equipment

Deposits on rental premises

Proceeds from sale of equipment

Proceeds from sale of property

Net cash flow from investing activities

Cash flow from financing activities

Proceeds from borrowings

Payments of borrowings (repayment of principal)

-0

Investment into business

Drawings from business investment

-0

Net cash flow from financing activities

Net increase (decrease) in cash held

1482090

Cash at beginning of period

50000

Cash at end of period

1532090

(Aqua Pure)
Statement of Cash Flows
For the year ended December31,2017
$
Cash flow from operating activities
Receipts from customers

4077784

Payments to suppliers

(593190)

Payments to employees

(626652)

Interest payments

-0

Interest received

Taxes paid

-0

Net cash flow from operating activities

1934217

Cash flow from investing activities

Purchases of equipment

Deposits on rental premises

Proceeds from sale of equipment

Proceeds from sale of property

Net cash flow from investing activities

Cash flow from financing activities

Proceeds from borrowings

Payments of borrowings (repayment of principal)

-0

Investment into business

Drawings from business investment

-0

Net cash flow from financing activities

Net increase (decrease) in cash held

1934217

Cash at beginning of period

300000

Cash at end of period

2234217

(Aqua Pure)
Statement of Cash Flows
For the year ended December31,2018
$
Cash flow from operating activities
Receipts from customers

5296619

Payments to suppliers

(771147)

Payments to employees

(814648)

Interest payments

-0

Interest received

Taxes paid

-0

Net cash flow from operating activities

2521982

Cash flow from investing activities

Purchases of equipment

Deposits on rental premises

Proceeds from sale of equipment

Proceeds from sale of property

Net cash flow from investing activities

Cash flow from financing activities

Proceeds from borrowings

Payments of borrowings (repayment of principal)

-0

Investment into business

Drawings from business investment

-0

Net cash flow from financing activities

Net increase (decrease) in cash held

2521982

Cash at beginning of period

400000

Cash at end of period

25612982