Industry Profile and Market Assessment

Pushbutton telephones have a growing market with the increase in number of service providers. Initially there was only BSNL providing communication facilities in the country and the entire requirement of instruments was met by public sector undertaking ITI. With the changes in policy and relaxation other service providers have come into market thereby increasing the demand of both the instruments as well as the consumers. The private sector service providers are not dependent on ITI for their requirement of instruments and this increase in demand has provided opportunity to other units to grab a share of the demand. Push button instruments have advantages over the conventional dial type ones both in ease of operation as well as in manufacture.

These sets are comparatively easier to manufacture and cheaper as compared to dial type. Operation wise also these have such features that were never available in earlier instruments. The past statistics of number of dial type instruments manufacture along with the huge replacement demand running into million numbers can be estimated to be the market of push button instruments. Although there are a number of big units in the market but the small manufacturers are also doing good business. The small manufacturers have an edge over the larger units in respect of prices and localized market. The small manufacturers basically assemble the sets from knocked down kits. Is no restriction on foreign collaboration in this item and the SKD kits can be imported.

Manufacturing Process & Know How

The product contains a memory chip, redialing chip, Random access memory, Push button reed switches, cabinet, power supply circuits, LED/LCD displays, etc. The number attempted is stored in memory. In case the desired number is busy the system resets and starts redialing after the availability of the dialing tone. The process continues until the dialed connection is established. It is possible to store a set of numbers in its memory and the numbers are dialed sequentially at the mere push of a button. The number dialed is displayed on the screen to enable the calling party to know the dialed number. These telephone sets also have the provision for caller identification display automatic redialing and speed dialing facility.

The manufacturing process is either assembly of SKD/CKD components or actual manufacturing and assembling with approved circuits. The components are first tested individually in standard jigs and then assembled on previously designed Printed circuit boards. The display and push button switches assemblies are separately wired before assembling on the PCBs. These are tested before final assembly in the cabinet. The sets are also subjected to vibration test and weather conditioning tests final assembly.

Suggested specification for the instrument is an instrument with 16 memory dialer with push button switches as a standard product. The initial capacity of the unit should be 10,000 pieces per annum.

Plant and Machinery

Since the manufacturing process involved is basically an assembly oriented one the major plant and machinery involved include VTVMs, Test signal generator, Multimeters, Oscilloscopes, Pulse generator, Function generator, Vibration testing arrangement, Soldering iron, Jigs and fixtures Logic probes, services meters, etc. the total cost of plant and machinery is estimated to be Rs. 15 lakhs.

Raw material and Components

The basic raw material and components required are indigenously available except for LSI chip which can be easily imported under different schemes. The raw materials required are Resistors, capacitors, diodes, Transisitors, ICs, transformers, Battery cells, LED/LCD displays, Reed switches with push buttons, cabinet, SI dialers, memory chips, etc. For the suggested capacity of 10,000 numbers the total cost of raw material would be approx. Rs. 50 lakhs.

Land and Building: For smooth operation of the unit it will require a built up area of 250 sq. mts. The total cost is estimated to be Rs.5.00 lakhs.

Manpower

For smooth functioning of the unit the requirement of man power is expected to be around 21 persons.

Technical staff	self
Skilled & Semi skilled workers	10
Office staff	5
Marketing staff	5

Cost of Project

	Rs. lakhs
Land & Building	5
Plant & Machinery	15
Margin money	3.41
Total	23.41

Profitability

Rs. lakhs
Sales (10000 nos) S.P of Rs1100/-	110
Raw material	50
Salary	9
Sales expenses	17
Other expenses	20
Depreciation	2.5
Interest	3.2
Cost of production	101
Profit	9.3

Requirement of Working Capital

W.C Margin money
Raw material	15 days	2.08	0.41
Work in process	7 days	1.23	0.31
Stock of finished goods	15 days	4.58	0.46
Working expenses	1 month	2.33	2.33
Margin money for W.C			3.41

Break Even point