Semester 4 [Business Plan]

Entrepreneurship

Title: Business Plan on Cotton Ginning & Pressing Factory

Division: A

Submitted By:

Submitted To:

11SOEBA21005 Bhuva Bharat

11SOMBA21029 Khunt Sanjay

Dr. Dharmesh Raval

Associated Professor
School of Management
RK.University.

Batch: 2011 13

PREFACE

In each and every field of the life practical study is necessary. Theoretical
knowledge is no enough. The subject new entrepreneurship has been introduced by
our University with objective to develop entrepreneurial and management skill
among student.
The main object of the like practical study is to get personal touch of the
organization problem and management of the unit. So, practical knowledge is
prime importance for student of management.
The main aim of this subject is to assist the student in developing skill in problem
solving and decision making in management of small business. To develop skill at
student level the students are required to present a business plan on his selected
business.

In this regard we are glad to submit a business Plan on our business on Cotton
Ginning & Pressing Factory

INTRODUCTION

The development and importance of small scale industries have increased

immensely in this era. Generally less capital is required for running small scale
business as compared to large scale organization.
Small scale industries play a key role in the industrialization of developing
countries. This is because they provide immediate large scale employment and
have a comparatively higher labor capital. They need lower investment, offer a
method of ensuring equitable distribution of national income and facilitate an
effective mobilization of resources of capital and skill which might otherwise
remained unutilized and they stimulate the growth of industries, entrepreneurship
and promote a more different pattern of ownership and location.
So, we have prepared a Business plan on small scale industries for
manufacturing Cotton Ginning & Pressing factory

Cotton Ginning & Pressing factory AT A GLANCE

Name of the Unit-

Asutosh Cotton Ginning &Pressing

Address of the Unit-

Asutosh Cotton Ginning & Pressing

To :kharchiya
Ta :Rajkot
Di :Rajkot
Via :sardhar
Pin no:360025

Form of the organization-

Partnership

Name of the partners-

Bharat patel
Sanjay patel

Line of Activity-

Ginning & Pressing

Main product-

Cotten

Initial Investment-

1.5 crore

No. of shifts-

One shift 8:00 a.m. to 6:00 p.m.

Accounting Year-

1st April to 31st March

No. of Employees-

33

Weekly Holidays-

Sunday

E-Mail ID-

bharatbhuva005@gmail.com
Khuntsanjay99@gmail.com

JUSTIFICATION OF THE LOCATION

Location of an industry plays a vital role for the development of an enterprise. Site
selection is an important activity which decides the business. A good location may
reduce the cost of production and distribution to a considerable extent so that why
we have chosen this location which is near to the village and sources of raw
material from where we can get the thing easily. There are many other factors
which inspire us to choose this location. Those factors are as follows:

Raw material- The main raw material for our product is cotten which can
be generally purchased from local market of village. If there is shortage then
we can get it from the nearest village

Labour Supply- The supply of skilled labor at law cost is important.

Machines cannot produce anything without availability of labour. Nearness
to the sources of labour is therefore important. As we have chosen location
near residential area, we can easily get skilled labour from nearby villages
also.

Transportation- Transportation plays an important role in getting raw

material as well as to send finished product. As most of the required raw
material is locally available and we have local market transportation does
not include higher costs.

Nearness to market- From market point of view we have a good and ever
expanding market for our market. We can easily get market in itself and it is
better for us to have market nearness to the unit. Thus by selecting local
market for raw materials and sales we can save higher transportation
charges.

 Power Supply- Power supply has much more importance in manufacturing

the product without any interruption 33 the production system. If we have
frequently cut off power then if affects total production system and
efficiency of unit. As far as our unit is concerned there is no problem of
power from P.G.V.C.L. at reasonable rate.

Financial facilities- Finance is life blood of any industry. It is lubricant for

smooth running of business. We can satisfy our financial thrust by
government banks, co-operative banks and remaining shall be our own
contribution.

Governments Facilities and Subsidies- Being a small and labour oriented

business government is giving incentive to these units. Due to location of the
industry in this particular area government gives subsidy and tax benefits
also.

Industrial overview
1.introduction
Ginning is the first mechanical process involved in processing cotton. Ginningmill
separates cotton fibers from the seed bolls and dust particles. The mainapplication
of ginned cotton referred to as lint is for spinning operations, wherelint is
converted to yarn.

2. Market:
World production of cotton stood at 137.8 million bales in the year 2010-11. The
leading producers include China, India, USA, Pakistan, Brazil, and Turkey.
Cotton textile commands a significant share in exports from India. It accounts
for nearly 22% of the total exports. Area, production and productivity of cotton
in India in the year 2010-11 stood at 93.73 lakh hectares, 290 lakh bales(170 Kg of
each bale) , 526 Kgs per hectare.
A.P. stands 3rd rank in Cotton area in India with 10.96 lakh hectares (Ha) next
only Maharashtra (31.91 L.ha) and Gujarat (25.96 L.ha). The share in area of A.P.
in India is 11.5 %. It also stands 3rd in cotton production in India with 43.00 Lakh
bales (Bale is 170 kg each) with an average yield of 667 Kgs next only to
Maharashtra (60.00 L.B) and Gujarat (110.00 L.B). Adilabad, Guntur and
Warangal had recorded higher growth in cotton area cultivation and production.

3. Raw Material:
The raw material considered for the ginning operations is Raw Cotton/Kappacotton
available in candy of 356 Kgs/candy

4. Manufacturing Process& Technology

Ginning Process involves two cleaning stages:
1. Pre Cleaning
2. Post Cleaning
The main operation of separating seed from cotton is done by saw gin. In the gin
house after ginning process is completed the cotton lint and cotton seeds are
separated and the lint passes out through pneumatic system to the Post-cleaner

(Lint Cleaners) in which small impurities, dust particles, small fibers are carried
out and cotton becomes free from contamination.

Pressing:
Cleaned Lint is taken to the bale press which compresses the ginned lint into
bales that weigh around 170 Kgs. After pressing is completed the bale is
tightened and covered fully with cloth, after then the bale is weighed and kept in
the hall safely.The bales are then wrapped with a protective cover, ready for
delivery to thewarehouse where they are sold to various textile mills

Technology:
The technology required for the ginning & pressing operations are cotton
ginning machinery, pre cleaner, lint cleaner, Kappas conveyor system, lint
conveyor system, Hydraulic cotton baling press, conveyor for seed, electrical
infrastructure, Humidifier and weigh bridge etc. The other optional machinery
required is the foreign fibre detectors/removers.
Yield and Production:
The yield of lint cotton is assumed at 32%, seed is assumed at 65% and waste is
assumed at 3% which are based on the industrial norms and manufacturers
specifications.

For cotton ginning and spinning in Gujarat

The new policy will enhance growth of cotton farmers and ginners, by way of better price

realization and to enable them to withstand uncertainty due to price fluctuation,

nationally and internationally and encouragement will be provided to establish new
cotton spinning activities to strengthen the value chain. Among incentives, it will
offer
- Interest subsidy of 5 percent, without ceiling for the period of five years on new
plant & machinery for Ginning & Processing;
- Interest subsidy of 7 percent on new plant & machinery for cotton spinning, as
well as for second hand imported cotton spinning machinery with certain
conditions, without ceiling for the period of 5 years;- Minimum 150-acre land,
stamp duty exemption to developers and units, and assistance up to 50 per cent

MANUFACTURIGN PROCESS

Production is an important part of any industry engaged in the conversion of raw

material into semi-finished goods or finished goods. The manufacturing process
plays a very important role for the production of any particular product. The
manufacturing process of our product is as under:

Separation

Drying

Cleaning

Distributing

Ginning (gin stands)

Baling

Cotton oil

Cotton seed

Animal feed

Double Roller Ginning Machines

Robust Body
Simple Operation
Easy Maintenance
Interchangeability
Spares
Lowest Power
Higher Output
Higher Profits

High Capacity Press (30-35 Bales/Hr.)

Medium Capacity (15-18
Bales/hr)
High capacity (30-35
Bales/hr)
Fully automatic
High/Universal Density
Bales
Lowest cost per Bale
Most Profitable

of

Auto regulator
Optimizes ginning performance
Made with superior technical
Robust Construction

Cotton ball

Animal feed

cotton seed

Cotton

cotton seed oil

LIST OF MACHINERY AND EQUIPMENT FOR COTTON GINNERY

S/N.

Description

Qty.

Separator

Dryer

Cleaning machine

Master extractor

Distributor

Feeders As required

Gin stands

Lint cleaners

Hot gas generator 1

10

Ribs, mating devices and doffing Devices

11

Seed handling equipment (selfclearing

belts and blow pipes)

As required

12

Condenser

As requreid

13

Presses

As required

AS required

MANPOWER REQUIREMENT OF COTTON GINNERY

Ser.

Description Required

No.

No.
1

Plant Manager

Secretary

Production and Technical Head

Production Supervisor

Machine Operators

Electrician

Mechanic

Accountant

Store Keeper

10

Cashier

11

Clerks

12

Unskilled Labour

13

Guard

14

Messenger

15

Driver

Total

33

INITIAL INVESTMENT COST

No

Particular

Amount

Land

40,00,000

Machinery

65,00,000

Building

10,00,000

Electronic

3,00,000

Vehicles

20,00,000

Staff salary

2,20,000

Raw material

8,00,000

Other

2,00,000

Total

Mean of finance
1
2

Promoters contribution(1:1)
Bank loan

1,50,00,000

60,00,000
90,00,000

What We Manufacture?
Cotton ball
Cotton Bales it is cotton packed in bales form. This cotton says as Shankar-6
variety, it is produced in only Gujarat (India). Cotton bales are a result of Ginning
and Pressing Process of cotton. Our Ginning Unit separate cotton fibers and seeds
from Cotton crop, Wes use only best quality raw materials to ensure a highly
reliable production. We taking Care during the complete mechanical process of
produce Cotton bales

Cotton Seed Oil

Cotton Industries Manufactures Cottonseed Oil as a bi Product It is vegetable oil
extracted from the seeds of the cotton plant after the cotton lint has been removed.
It must be refined to remove gossypol, a naturally occurring toxin that protects the
cotton plant from insect damage. It is used by human beings as edible oil

Cotton Cakes(animal feed)

We also manufacturers and Exports Cotton Cakes, We produce cotton cakes as a bi
product, Cotton cake are the solid matter remaining after oil has been pressed from
cottonseeds. We have Cotton Cakes that are largely used in the industry. We offer
very reasonable prices for our products. These Cotton Cakes are widely in demand
and are used for many purposes. It is mainly used for feeding cattle

To whom we sale?

To local ginners who export the balls

To spinning mill (surat , Mumbai, )
Cotton oil in local market
Cotton cake (animal feed) local market
To other parties who export the balls
Ginning cotton to medical

Approximant production per month ?

(price as per date 4-3-2013)
per 16000kg product estimation
16000kg cotten
1020per 20kg

65%

35%

5600kg cotten

10400kg cotton seed

32.5rs per kg
170kg per ball

33 ball
20% oil

2080kg oil

140 tin

1150 per tin

80% other

8320kg
(animal feed)

16 bag

840 per bag

20000per ball

Swot analysis
Strengths
The pioneer and the only institute in the country actively involved in all post
harvest processing aspects of cotton. India is the only country growing all the four
species of cotton including hybrids. Strong technological and scientific capability
in well qualified and experienced staff with interest in basic research is the
Institutes strength. The laboratory is accredited by NABL and approved as Nodal
Agency for developing certified reference materials on cotton and its allied
products. Trade and industry look upon this Institute as the primary agency for
promoting Indian cotton across the globe

Weaknesses
Among the foremost weakness is inadequate scientific personnel and lack of space.
The Institute lacks international exposure. There are a lot of administrative
bottlenecks in a governmental set up.

Opportunities
Textile Research Associations (TRAs) are no more in full vigour. More applied
R&D and selling of technology should be taken as a challenge. Technology areas
are not truly saturated for cotton. Creating database on imported cottons and using
it to generate income, also, opening up services to overseas clients are some of the
opportunities. By-products of cotton plants have not been sufficiently exploited for
farmers benefit. This area exposes innumerable opportunities for the Institute to
grow and excel.

Threats
Indian firms and also branches of foreign firms are getting stronger in the testing
services area, especially by providing total service expeditiously at reasonable
costs. Globally, manmade fibres are displacing cotton: and this is happening in

India also in spite of its weather conditions being more favourable for wearing
cotton. Availability of cleaner and cheaper imported cottons from other countries is
a threat looming large. Cheaper rates of good quality imported cotton, manmade
fibres, ban on finished goods due to pesticide residues and high cost of cultivation
are some of the threats faced by India that indirectly

Thank You